Project finance is difficult to define but easy to
recognize; it generally involves lending significant amounts of
money to a thinly capitalized company whose primary assets
consist of contracts and licenses, but that is where the
simplicity ends. Notwithstanding the efforts of various
governments to standardize private finance initiative (PFI) and
similar documentation, the field defies the application of
fixed rules. The range of assets financed, from underground
mines to overhead cables, and the breadth of jurisdictions
covered, from Canada to Mozambique, mean that even the most
basic rules must flex to meet the facts and issues in question.
In the absence of rigid market standards and agreed form
documents, the project finance lawyer must patiently assess the
economic, technical, political and legal risks presented by
each project and draw on experience to help the parties reach a
workable consensus in face of often unique challenges.
The discipline is...