Ecostar
Energy Inc.
Our Process
Large Infrastructure construction consists of a sequence of refinement steps.
OUR PROCESS
PRELIMINARY EVALUATION:
During this phase we require from our partner a project description in the form of a proposal that includes the either the Memorandum of Understand, the concession agreement; the technical and financial reports, and the feasibility work required for your project.
The preliminary assessment and due diligence could take up to 3 months depending on the project details, location and most importantly the development stage. Note that the proposal should include a budget and a proposed Terms of Reference.
PROCESS OUTLINE:
1. The local partner contacts Ecostar’s for financial and technical assistance needed to support the feasibility study and the development of an infrastructure project.
2. Ecostar Holding reviews all documents, with the assistance of a subject matter expert, and conducts due diligence on the projects; the local partner and the Country’s political stability.
3. Once all questions are answered, the application is presented to the Ecostar Holding Board and approved, denied, or modified.
4. If it is approved, a Partnership Agreement is signed between Ecostar Holding, the local government partner and the Grantee.
5. Once the Partnership Agreement is signed, The SPV is created and Ecostar Holding Energy begins the feasibility study.
6. Once the feasibility work is completed, the SPV will use the study to attract financing, bring the project to financial close, and implement the project!
SPECIAL PURPOSE VEHICLE (SVP)
The Special Purpose Vehicle (SPV) will be a legal entity created for the managing the project. In the context of raising capital, the SPV will be used as a funding structure, by which all investors and partners (or investors under a given investment threshold) will be pooled together under the SPV’s umbrella for the duration project.
This will be a separate legal entity constituted by the equity holders, and debt holders. The "sponsors" will essentially be the controlling equity shareholders, whom will also take a deep operational responsibility and tight governance of the SPV. Shareholders of the SPV depending on their specific roles will be responsible for (1) negotiating and securing the right to the infrastructure with the local authorities; (2) Identifying and securing the land base on the technical, financial and environmental specifications of the project; (3) Conducting the environmental and social impact study; (4) Negotiating and securing a Power Purchase Agreement (PPA) with the local authorities.
Power Purchase Agreement: Once a PPA is signed, the SPV will identify, negotiate and sign an Engineering-Procurement-Construction (EPC) contract and also an Operating & Maintenance Contract with an O&M Contractor to secure long term maintenance of the Infrastructure.
KEY DELIVERABLES
Regulatory Review
This will examine the legal and regulatory issues that would need to be addressed ahead of project implementation. This task typically includes language requiring the local partner and authorities to identify the potential regulatory barriers to project implementation and how they can be addressed.
Financial Analysis
This is a discussion based on the financial requirements to implement the project, which typically include determining the availability of equity and debt financing, the level of interest from potential financing entities. Here we make recommendations on financial structuring and provide an outline of a plan to bring the project to implementation/financial close.
This is a discussion based on the financial requirements to implement the project, which typically include determining the availability of equity and debt financing, the level of interest from potential financing entities. Here we make recommendations on financial structuring and provide an outline of a plan to bring the project to implementation/financial close.
Technical Analysis
This task ummarizes the work required to develop and implement the technical aspects of the project and includes:
• Data collection; Technology review and selection;
• Project site preparation;Conceptual design and costs; and
• Modeling and forecasting.
This task ummarizes the work required to develop and implement the technical aspects of the project and includes:
• Data collection; Technology review and selection;
• Project site preparation;Conceptual design and costs; and
• Modeling and forecasting.
PROCESS OVERVIEW
