I get questions on #Projectfinancelaw so I'll do a thread under this tweet. It'll be a long one so I'll add to it every few days or so, between 6.00 a.m - 7.00 a.m SAST.

It'll have insights from both my work & my ongoing master of laws in financial services.

Why does it matter? For all its complexity, #projectfinancelaw is a tool for public service. Large infra projects affect lives - how we get around; cost of living; taxes; health, safety & security; ease of doing business; climate change; quality of life.

Understanding #projectfinancelaw allows you to pursue accountability, participate in the processes & potentially influence policy

Project finance focuses on funding a project rather than funding a borrower. It's usually for projects whose financing requirement is either so large or so risky (or both), that it's impractical for a single financier to take it all up.

The reason #projectfinancelaw is so focused on risk is precisely that multiple stakeholders need to be allocated a portion of the overall risk. The general rule is that risk should lie with the party in the best position to control/handle/mitigate/prevent it

Risk identification and allocation begins even before a project has been brought to the market for potential developers and financiers to consider. It starts when determining which infrastructure projects should be prioritised

Projects typically financed this way include both renewable & non-renewable energy power plants, roads, bridges, railways, airports, sea ports, inland ports, mines, refineries.

Other projects that suit this type of structure are in the information & communication technology sector. They include telecommunications infrastructure, data centres, powerline carrier communication infrastructure & other fibre optic cable lines

Social infrastructure such as hospitals, schools, prisons, educational institutions, student housing and public housing may also be financed this way

The financing structure is usually a mix of equity+debt, with sources spanning ordinary & preferential equity, shareholder loans, equity bridge loans, commercial debt, mezzanine loans, development finance, export credit finance, multilateral guarantees & government contributions