Energy Project Financing

The non-renewable energy sector is comprised of two main industries: oil and gas. While our main focus has always been renewable energy, much of what we do synergizes well with non-renewable energy project financing. The driving principles are the same in both, a fuel source is used to produce energy, which is then fed into the main power grid. There are substantial differences in the technology, feedstock, and costs, in which our energy project finance team is well-versed. Whether you have a power plant, refinery, or other oil & gas project, we have the resources and knowledge to provide you with the funding required for your energy project financing needs.

The oil & gas industry has been steadily growing, with upstream spending over $700 billion in project financing in 2013. This surge in energy project investment can be attributed in part to the expanding range of financing solutions in recent years. While this has led to the larger energy companies surging, the smaller, independent companies face trouble competing for energy project funds. Project financing for the oil and gas industry is less common for a variety of reasons, largely that oil & gas is a long-term industry and many of the funding options reflect this. In comparison to similar industries with large infrastructure, such as other energy projects, oil and gas tends to be less stable and less reliable. This drives away many investors only after the easiest energy project financing, generally pushing them into the crowded renewable energy project financing market. Green Energy Experts will continue to provide energy project financing solutions to clients in the non-renewable energy sector by funding projects such as oil refineries in the United States, Canadian liquefaction plants, and LNG power plants in India.

Our team has experience and relationships throughout the various energy industries. We provide capital to oil & gas companies for exploration, production, midstream, along with energy services and infrastructure projects. If you have an energy project that you would like to discuss financing options for, please contact us. We are glad to share our knowledge and find out if private financing may be right for your energy project.

Infrastructure Loan Financing

Infrastructure project financing is something relatively new to the world of private lending. Historically, public infrastructure projects were large and typically funded by the government through fundraising channels such as bond measures. Later, seeing the need for more options, banks entered and have become the traditional financing provider for commercial infrastructure loans. In recent years private sources of capital have quietly been entering the commercial marketplace. The migration toward private lenders has been slow for a number of reasons, including capital intensity and a long asset life. It takes a specialized team to understand the unique requirements and characteristics of infrastructure loans, this coupled with the previous issues has prevented many lenders from entering the market. Our team is well versed in the unique challenges faced when seeking large commercial project financing. We can provide creative solutions that include both private equity financing and debt financing or a combination financing package.

The difficulties do not end there, as these tend to be the most complex projects we see. Each commercial infrastructure project is very unique and little specific information carries over from one project to the next. In order to spread the risk across the numerous entities involved, complex legal agreements are required. Commercial infrastructure financing often appears clouded with the depth of legal arrangements and unique nature causing a lack of transparency. This concerns many investors who are used to more straightforward, fully transparent projects in other sectors.

We are not deterred by any of these issues, as we look beyond the troubles above. By approaching infrastructure lending as another form of commercial project finance, it allows us to bring our experience and proven methods. This technique allows us to simplify an already complex financing project by adding structure and clear expectations. Our team understands the risks involved, and how those are outweighed by benefits. Once infrastructure projects pass the high costs & risk in the pre-development and construction phases, entering the operational phase they generally become very stable and profitable. Beyond their strong stability and profit potential, financing commercial infrastructure projects is invaluable to the communities the projects serve, providing resources such as reliable clean drinking water. For these reasons, we appreciate any opportunity to work on infrastructure projects where private lending is required.

Joint Venture Financing

Joint venture (JV) project financing is an excellent funding solution for many businesses. This allows companies who are willing to give up some equity to grow without adding debt to their books. Companies with a solid business model and product can use this approach to scale up quite rapidly as they are not burdened with debt or loan repayments, enabling them to focus on creating additional revenue and adding more value than they could with traditional financing. Other businesses seek out more strategic joint venture funding to grow their business. In these partnerships the financing may be of less importance than the relationship itself with the joint venture partner. The equity capital is exchanged for benefits the partner can provide, such as being able to develop relationships with commercial vendors or retailers which otherwise would not be possible, or the use of commercial equipment which allows for an efficient means to scale operational production.

Whether you are seeking to grow your small business or acquire an investment property, it is important to consider that joint venture capital lenders have even more leverage than a traditional debt capital lender. They are more selective as the stakes are different. Rather than evaluating the ability to make a low fixed monthly payment over a period of time, they must evaluate the success of the company over time. The more success your company experiences, the greater the return for the jv capital investor. While that may seem intimidating to some, it is actually a very good thing for the client. You get a much more hands-on lender who not only is concerned about your success, but is focused on the magnitude of your success. Nearly every industry and project type can be funded by JV capital loans. Common venture projects are hotels, shopping centers, office buildings and condos, where both parties share in the risks and rewards of the joint venture project.

When approaching joint venture capital funding for your project, always remember investors are looking for profit potential and are adept at reading between the lines. Simply stating that your project will make a lot of money isn’t good enough. Your key to success in securing investment is presenting a professional business plan that clearly outlines how you will achieve your goal. Another important factor is the management team; an investor needs to feel he is working with a team that is experienced and will get the job done, think of it as a job interview for your company.

Our team is happy to listen to your financing needs and help determine if joint venture financing would be the best way to provide working capital for your project. We will use our experience to create solutions that meet your funding requirements and create long-term success.