strategic consulting and industry advisory · pdf filereview refinery feasibility study...

For over 20 years, Baker & O'Brien consultants have acted as "Technical Advisor" onmajor energy projects. In this role, we often perform a technical and economic duediligence analysis of the project. We advise owners in the aspects of plant financing,and lenders in project finance transactions. These advisory services include: technology review; contract covenants; engineering, procurement and construction;and the technical, operational, and market assumptions for financial models.

With over 100 projects advising lenders, Baker & O’Brien consultants haveexperience in performing this role throughout the world and for a vast array ofindustries, including petroleum refineries, alumina smelters, organic and inorganicchemicals plants, natural gas processing facilities, petrochemical plants, crude oiland product pipelines, LNG liquefaction facilities, offshore production platforms, retailmarketing facilities, power plants, and pulp and paper mills.

RELATED INDUSTRIESAdditional Process IndustriesGas ProcessingOil and Gas ProductionPetrochemical / ChemicalPetroleum RefiningPower GenerationRenewable / Alternative EnergyTransportation and Storage

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STRATEGIC CONSULTING AND INDUSTRY ADVISORYSERVICES

Due Diligence and Advisor to Lenders and Investors

PRIMARY CONTACTS

W. Rob DonnellChief Executive OfficerDallas

Donald L. FlessnerPresidentDallas

Aaron J. ImrieConsultant, Recruiting ManagerDallas

William D. JacksonConsultantDallas




RELATED EXPERIENCEAmmonia Plant Project FinanceServed as independent engineer on behalf of a major European bank for the relocation of a 750 TPD ammonia plant. Workincluded an assessment of existing and new technology that was to be incorporated in the project. The due diligence investigationanalyzed feedstock supply, reviewed contracts, and inspected progress prior to close of financing. Monitored constructionprogress, certified mechanical completion, and witnessed the plant performance test. Ammonia Plant Project FinanceServed as independent engineer on behalf of a major European bank for the construction of a new world-scale ammonia plant.Prepared a technology assessment, analyzed feedstock supply, reviewed contracts, and advised with negotiation of contracts.Monitored construction progress and mechanical completion, and witnessed the plant performance test. Business Interruption and Construction - RefiningMonitored engineering and construction efforts undertaken to rebuild production facilities damaged by fire. The engagement wasto ascertain the appropriate construction period for business interruption claim purposes and to facilitate the incident root causeanalysis. Activities included daily site inspections, regular consultations with plant engineering and construction personnel,progress assessments, and development of independent project schedules. Evaluation of Refinery Operating ProceduresActed as independent advisor in a dispute between a refinery and the Environmental Protection Agency following a period ofexcess emissions. Independent EngineerRetained as the Independent Engineer for the "grassroots" Tangguh LNG Liquefaction Project in Indonesia. Prepared the technicaldue diligence for the US$3 billion facility on behalf of a financial consortium. Independent Power ProductionAssisted in the development proposals for two independent power projects in southeastern Japan. One facility, which wassuccessfully implemented, involved a $180 million investment for a petroleum coke-fired 130 megawatt condensing turbinegenerator. Assisted in the creation of a sophisticated linear program model, which was used to justify the project, based on cashflows and probable rates of return. Lender's Independent EngineerServed as independent engineer for a "grassroots" olefins project. Prepared the technical due diligence for a US$4 billion facilityon behalf of international export credit agencies and onshore and offshore lenders. Marine Terminal DevelopmentReviewed design requirements and monitored construction, start-up, and operation of a project to develop a bulk liquids terminal. Work included review of dredging requirement, schedule, and interfaces between this project and a project to export ammoniafrom the terminal. New Petroleum Products TerminalOn behalf of a major international construction company, prepared a preliminary feasibility study on a new petroleum productsimport terminal to serve the local market . Study included facility layout and size estimates for docks and storage tanks. Offshore Pipeline ProjectServed as Independent Engineer on behalf of a major financial institution for a $200 million project to build a deepwater gas andoil-gathering system. Prepared a valuation of offshore pipelines and an onshore gas processing plant for gathering and processingof deepwater Gulf of Mexico oil and gas production in support of structured finance. Certified completion of the project for financial




of deepwater Gulf of Mexico oil and gas production in support of structured finance. Certified completion of the project for financialpurposes. Oil Company PrivatizationPerformed due diligence for the purchase of an integrated oil company on behalf of an investor. Inspected company assets,assessed technology, analyzed feedstock and product markets, evaluated a capital investment program, and analyzedmanufacturing economics. Paper Coating Plant Project FinanceServed as independent engineer on behalf of a major financial institution for the construction of a new $100 million paper coatingplant. Prepared due diligence, assessed technology, evaluated project scope of work and schedule, reviewed engineering,procurement, and construction contracts, and advised bank with respect to mitigation of project risks. Valuation of Pipelines and Gas PlantServed as independent engineer on behalf of a major bank to value and certify completion of a project to build offshore pipelinesand an onshore gas processing plant for gathering and processing of deepwater Gulf of Mexico oil and gas production. Thevaluation was prepared for the lender in support of $200 million of structured finance. Power ProjectSupported lenders in mezzanine financing for construction of a cogeneration plant in Western Siberia. Advised as to the collateralvalue of certain equipment ordered for the project and evaluated the technical capabilities of the company to manage the projectunder long-term project financing. Technical ReviewPerformed technical review of chlor-alkali and calcium chloride processes and project plan on behalf of prospective lender.Reviewed the process design packages for the chlor-alkali and calcium chloride production facilities and provided opinionsregarding the selected processes and their technical compatibility. Reviewed the project schedule and cost estimate for thefacilities and provided input to the prospective lender regarding the appropriate level of contingency. Evaluated the contractingstrategy and project execution plan and provided opinions. Refinery Reactivation and UpgradingWorked on behalf of a major investment banking group to evaluate the plans of an independent refiner to upgrade and reactivateits 200,000 barrels per day refinery. Conducted "due diligence" on the company's plans and specifications, evaluated likelyeconomics, and assessed competitive forces in the marketplace. Upon closing of the financial transaction, monitored theconstruction progress, schedule, and budget over a period of four years. Reviewed all invoices for labor and materials andapproved draw down of construction funds in accordance with the contractual agreements. Refinery Feasibility StudyDirected a feasibility study into a joint venture "grassroots" export refinery in the People's Republic of China. Advised the Westernpartner during several "rounds" of negotiation with the Chinese partner over a period of two years. Prepared estimates ofanticipated rates-of-return for both parties under different economic and cost-sharing scenarios. Assisted in negotiations with localtax and regulatory authorities. Project was shelved following Gulf War. World Scale Alumina Refinery - Independent EngineerTeamed with a mining consulting firm to provide independent engineering support to lenders of a world-scale, multi-billion dollargrassroots alumina refinery to be located in Guinea, West Africa. Reviewed project execution plan and entire design package forthe proposed facility, including alumina refinery, power plant, import/export facilities, and all associated infrastructure. Preparedseveral interim reports during the initial engineering phase before project was abandoned due to political unrest within the country.




Review Project Development CostsEvaluated multi-million dollar cost overruns of yearly operating budgets of a Central Asian consortium involved with the oil and gasdevelopment and production. Costs reviewed included Engineering Support, Operating Costs, Drilling Costs, and CapitalExpenditures. Refinery Off-Gas Recovery ProjectProvided independent assessment and due diligence for a proposed refinery offgas treating facility in the USGC. Advised theclient on requirements related to schedule, documentation, and technology selection for project financing. Review Refinery Feasibility StudyConducted a detailed review of a feasibility study to construct a new refinery (oil sands feedstock) in Canada. Reviewed capitalcosts, crude oil and product pricing assumptions, and several other key inputs that were used in an integrated financial model. Review Project Development CostsEvaluated multi-million dollar cost overruns of yearly operating budgets of a Central Asian consortium involved with the oil and gasdevelopment and production. Costs reviewed included Engineering Support, Operating Costs, Drilling Costs, and CapitalExpenditures. Review Infrastructure AssetsAssisted client in evaluating infrastructure spending to support ongoing operations and maintenance activities. Our reviewevaluated whether the infrastructure assets were integral to the overall technological complex. Condensate Gathering System Due DiligenceAssisted client with engineering due diligence on a Texas condensate gathering system focusing on pipeline mechanical integrityissues. Potential Refinery Acquisition On behalf of a prospective buyer, evaluated a Northern European refinery as a potential acquisition target. Determined the currentphysical condition of the refinery, its existing processing capability, and the potential for expansion and upgrade. Developed aneconomic and financial model that was used by client to prepare its tender offer. Refinery Due DiligenceEvaluated the condition of refining assets for a potential acquisition. Addressed any "fatal flaws" regarding acquisition and start-upof topping refinery. Provided support for evaluating order-of-magnitude costs estimate required to inspect, repair, staff, and startup the complex. LNG Due DiligenceProvided technical support to the sponsor of a multi-train liquefaction project. The scope of work included: preparation of atechnical due diligence report; in-depth review of the Open Book Estimate (OBE), schedule, and project execution plan;assessment of the EPC contractor’s capabilities and experience; high-level review of geotechnical issues; assistance in thedevelopment of an Operating and Maintenance (O&M) plan; input into the formation of sponsor’s project management team; andinput into the development of owner’s costs, including appropriate levels of cost and schedule contingency. Provided support to thesponsor with EPC contract negotiations. Ammonia Plant Project FinanceServed as independent engineer on behalf of the financial advisor for the construction of a new small-scale biomass to nitrogenfertilizers complex. Prepared a technology assessment, analyzed feedstock supply, reviewed contracts, reviewed site andinfrastructure considerations, and advised with negotiation of contracts.




strategic consulting and industry advisory · pdf filereview refinery feasibility study...

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