The Government of Ecuador granted a 50-year concession to a private operator/investor to design, finance, construct, operate, maintain, own, and manage a 27 MW run-of-the-river hydropower plant with an estimated investment cost of US$45 million. On behalf of the Inter-American Investment Corporation (IIC), Nathan conducted an appraisal and due diligence analysis of the project. We made recommendations regarding the technical, commercial, operating, financial, and environmental aspects of the project.
We based our opinion of the concession permit, energy production forecast, revenues, expenses, and technical feasibility on our analysis of the energy market, regulatory and economic environment, assumptions of the financial model, and proposed construction, operations, environmental management, insurance,and commercial plans.Our analysis and recommendations helped our client adjust the project structure to minimize the risk of debt service default. The project is under construction and is expected to start operations in late 2013.