"This book provides a comprehensive treatment of project finance accessible to those less familiar with the subject matter yet detailed enough to serve as a valuable reference for the experienced manager. The book covers a wide array of topics from legal issues to valuation methods, and even hedging financial risk with financial derivatives. Given the increasing importance of project finance in Asia and the Pacific Rim, Principles of Project Finance, will be an invaluable reference for academics and managers alike in this region."
--Nobuya Takezawa, International Christian University, Tokyo, Japan
"This is an authoritative work written by a distinguished practitioner. I have no doubt it will quickly become a key text for those in both public or private sectors whose work involves Project Finance."
--Michael Gerrard, Head of Public Private Partnerships, Partnerships UK plc
I am a power developer for a generation company in the Philippines. I got into my present job not fully understanding what project finance entailed, which is why I bought this book. The principles and fundamentals found in the book are so good, I recommended it to my colleagues as part of the training regimen for new analysts. I call Yescombe's book "the job" as it pretty much encapsulates what project finance analysts must know about development work, deal structures, financial modeling, and most importantly, contract and risk management. Highly recommended for all those starting out or considering a career in project finance.
This is an excellent reference book, very well structured, and related subjects are linked to each other along the text. The almost absence of numbers and modeling is not an issue, because the main proposal is to have all structuring elements and fundamentals explained, the ones that cannot be neglected in a serious modeling later. I do recommend.
Principles of Project Finance
E. R. Yescombe
Elsevier Academic Press
E. R. Yescombe's Principles of Project Finance, published by Elsevier Academic Press, is an excellent and thorough practical treatment of project finance issues for professionals and others looking for a broad and deep understanding. At 344 pages, this book includes 13 chapters and a detailed glossary of terms.
Clearly this book is by an exceptionally experienced and talented author, who focuses on how to make the project work. Every chapter is a good chapter; I particularly found Chapter 8 interesting with its detailed discussion of project risks, including, e.g. EPC contracting issues (Engineering, Procurement and Construction contracts), commercial viability, completion risks, credit risks, construction cost overruns, delays, relocation of utilities, protesters, project dependencies, environmental risks, operating risks, technology risks, operating cost overruns, maintenance, long-term sales contracts, waste disposal, recourse to sponsor issues, and many more. Yescombe discusses numerous issues and potential situations, and provides suggestions for how to resolve the issue.
In the first section, chapters 1-5, Yescombe provides a detailed discussion of the basics of project finance, with numerous tables and charts. For example,
Chapter 1 is a general introduction to project finance,
Chapter 2 reviews key characteristics of project finance and why it is used
Chapter 3 discusses markets for raising project finance debt
Chapter 4 discusses initiation and structuring of project development and finance for private and public projects
Chapter 5 reviews procedures for obtaining project finance from private lenders
In the second section, chapters 6-7, Yescombe discusses project finance documentation:
Chapter 6 discusses the main Project Agreement, which is often an Offtake Contract or Concession Agreement
Chapter 7 reviews other project contracts, such as construction and operation of the project, raw materials and other inputs, insurance, etc.
In the third section, chapters 8-11, Yescombe reviews project finance risk:
Chapter 8 discusses project risk and mitigation from the viewpoint of lenders
Chapter 9 analyses the effect of macroeconomic risk, such as inflation, interest rates, exchange rates, on project finance, and mitigation efforts
Chapter 10 reviews effects of political risks on projects
Chapter 11 reviews mitigation of political risk, including insurance, guarantees, export credit agencies and development banks, etc.
In the last section, Yescombe discusses the financing structure for projects
Chapter 12 reviews the use of project financial models for investors and lenders
Chapter 13 demonstrates review and risk analysis during negotiation of project finance structure and terms
Yescombe's Principles of Project Finance is a highly useful addition for anyone involved with project management and project finance, and serves as a useful reference.
I think that this is one of the best books ever written on project finance. It can be used as primer for beginners and as a frequent reference for those already familiar with the subject.
I am a corporate financial advisor for chemical company that is continuously invoved in developing new projects utilizing funds procured under the project finance concept.
Although I have read the book in 2003, I find myself repeatedly referring back to it whenever our company needs a project finance loan.
The author's immense experience in project finance has been distilled into the book.
I sincerely believe that all readers will find the book extremely useful. I recommend this book to everyone interested in project finance.
Product Details :
Hardcover: 344 pages
Publisher: Academic Press; 1 edition (June 20, 2002)
Language: English
ISBN-10: 0127708510
ISBN-13: 978-0127708515
Product Dimensions: 6 x 0.9 x 9 inches
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