Project financing has been experiencing a significant growth and changes in the last few years. With the increasing demand of infrastructure projects, as well as natural resource projects, in Australia and international markets, project financing has become a popular means of funding the capital-intensive projects which require financing beyond the capacity of traditional sources.
This report aims to investigate the essential aspects of a successful project financing. To achieve this objective, the report starts by defining the concept of project financing, and then proceeds to discuss the project evaluation process. The evaluation process includes: project review, risk assessment, financial analysis, development of a financing structure, syndication and documentation. The risk assessment and financial analysis are identified as of paramount importance to the project financing management, and therefore these topics are discussed in detail in this report. The report also looks to the recent development of project financing in Australia and overseas countries, such as the applications of securitization and the introduction of rated project financings in the public capital markets. Finally, some examples are presented to illustrate how project financings are structured and arranged in terms of transaction size and the types of financing facilities.