"A Methodology For Matching the Economic Characteristics of Natural Resource Ventures With the Investment Objectives and Financial Constraints of Project Sponsors in the Design of Viable Financing Structures"

Inflation and increasingly complex tax laws in the United States combined with rising national ism overseas have made the structuring of viable financing plans which meet the requirements of the various parties involved equally important in determining project success as the design of an efficient mining plan or selection of the optimal size equipment. Whereas the use of computerized analysis to design and evaluate the technical parameters of resource ventures is well accepted, computerized evaluation of the investment criteria (qualitative and quantitative) of the various parties to the project (mining firm, financial institution, product buyer, host government, etc.) is a more recent application which can make a material impact in strengthening project economics. By identifying the objectives of the parties and critically evaluating and testing them with the technical and economic/financial constraints on the project the sponsors can design a financial structure tailored to the attributes of the deposit. A myriad of new financial techniques have evolved for financing natural resource ventures, from "Commodity-backed bonds" to tax based limited partner- ships, but in every case the structure of the financing mechanism depends on carefully matching the parameters of the financial structure with the economic characteristics of the project and the objectives of its sponsors. This presentation outlines a methodlogy for computer based project evaluation in the design and structuring of stronger financial plans for natural resource ventures.