Financial Modelling of Geothermal Projects

Abstract

Engineers and geoscientists preparing feasibility studies for geothermal projects need to include some form of financial model of the proposed project. Their model usually presents a fairly accurate projection of capital and operating costs, but is often insufficient for lender financial purposes. The lenders then prepare their own model, which often inadequately represents the construction and operational detail of the project. A composite model is described which builds on a true representation of the technical aspects of project development, construction and operation to provide inputs to a corporate finance module which provides the developer with target annual corporate financial data and meets the requirements of potential commercial investors of equity and debt.