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Capital Project Development

   Project Development

Market Analysis, Competitive Assessment and Feasibility [up]

Evaluating the feasibility of new facilities or the expansion/modification of existing plants has been a primary emphasis of our client services. In mergers, acquisitions, and divestitures, we work with major global investment banks, and recommend specific courses of action to minimize the client’s exposure to risk and to provide the highest achievable return on investment.

We act as the interface among investors, lending institutions, and oil and chemical companies. We have served as Independent Technical and Market Advisors on greenfield world-scale production, upgrading, refining, petrochemical, chemical, manufacturing, and fertilizer facilities throughout the world.

Our scope of services range from preparing bankable documents, assisting in syndication presentations, conducting independent cost and schedule verification, monitoring construction progress, to developing and certifying acceptance test runs.

In addition to performing conventional financial analysis of proposed capital projects, we also provide insight for:

  • Peripheral issues — political, environmental, community, etc. issues, which may become central initially or during the life of the project
  • Technological and market competitiveness — in-depth technology comparisons from economic, operability, and reliability standpoints stemming from our strong background and experience
  • Transition — understanding the problems and opportunities inherent in developing a concept into a viable venture in terms of economics, markets, financing, risks, and competitive factors

Option Analysis, Configuration and Integration [up]

The goal of a refinery configuration study is to determine the optimum configuration given the pricing, objectives, and constraints of a specific project. We use a combination of sophisticated modeling tools and many years of experience to help our customers identify the configuration that will help them maximize their business returns. Our configuration studies encompass the following business perspectives:

Are the constraints real? Frequently, we work with clients who have a predefined concept of what the refinery must be capable of doing. In some cases, these constraints lead to uneconomic solutions. We work with our clients to vet the constraints early in the project.

Does the proposed configuration have the “right” flexibility? Refineries that can produce a wide range of products out of essentially any crude mix will have the highest gross margin per barrel. However, flexibility costs money. When evaluating flexibility, we carefully consider available markets, crudes, and trends to determine whether this can be justified.


Does the product slate match the market? While gasoline and diesel might obtain higher prices than liquefied petroleum gas (LPG), as an example, the capability to sell at home rather than solely in far-off markets reduces risk, and provides a solid foundation for the demand projections and the projected utilization rate.

Do the units, as specified, work together? In many processing units, there can be trade-offs between yield and product quality. Producing a little more feed for one unit may greatly increase the cost of the downstream unit or even make a configuration technically infeasible. A properly executed configuration analysis recognizes these trade-offs.

Are all the risks understood and accounted for properly?

Are the selected process units technically proven? Technologies or operations with little real commercial experience represent a risk. The benefits of a new technology have to be weighed against the impact that the new technology's performance will have on the overall complex’s operation. This is especially true in cases where the company is seeking bank or bond financing.

Advisian Downstream & Market Services maintains its own linear model databases and has expertise in both Haverly and PIMS platforms. We also use various non-linear models to simulate individual units as well as complete refinery analysis. However, we don't lose sight of the fact that the goal of a refinery configuration study is not only to provide an “optimum” configuration, but also to help our clients receive a strong return on investment over years of operation and numerous market situations.

Master Plans and Technology/Partner Selection [up]

We have developed the methodology and tools to provide consistent, accurate comparisons of competing technologies. The combination of our process knowledge, engineering capability, and project experience enables us to address all major issues.

Licensed process technology evaluation and licensor selection are two of the most important analyses in new project development. Selection of a process with inherently low energy efficiency, availability, poor yields, high catalyst costs or with poor flexibility to meet market demands will reduce profit margins throughout the operating lifetime of the project.

Unfortunately, technology comparisons are rarely straightforward. Competing licensors may quote yield, plant cost estimates, and royalties on completely different bases, while utility usage rates may assume different energy sources, equipment drivers and heating media. Our procedure is designed to eliminate differences in design philosophy and reporting that mask the true operating and installation costs of competing processes.


Additionally, an area that can no longer be overlooked as a critical aspect in an overall technology evaluation is environmental impact. We address the difference of environmental impacts as part of our evaluation. If the project is site-specific, we can estimate off-site costs as part of the total cost of the plant, and discuss how environmental issues affect the permit schedule and, therefore, the timing of an entire project.

Other Licensor Selection Activities
Licensor selection may also include our involvement, in close collaboration with the client, on the following activities:

  • Preparation of selection criteria, in terms of both essential and desirable characteristics, aligned with the client’s key project drivers
  • Technical compliance review of licensors’ offers and assessment of technical risk, and licensors’ experience and capability
  • Commercial review of licensor offers
  • Economic evaluation of licensor offers
  • Quantitative and qualitative comparison of licensor offers, using the agreed criteria
  • Licensor presentations and clarification meetings
  • Site visits
  • Final selection, based on the quantitative economic evaluation and qualitative criteria ranking
  • Novel technology development support

Objective, Independent Evaluators
Our experience in the critical aspects of technology comparison—process, environmental, and marketing—coupled with our structured approach validates our ability to objectively compare licensor-provided information. Furthermore, because we do not maintain a position in marketing products or licensing technology, we are accepted as true independent evaluators by all the major technology licensors.

Site Selection & Environmental Impact Analysis [up]

Advisian Downstream & Market Services has provided site selection services to industrial clients since 1974. Our clientele has consisted of global firms in a variety of industries seeking sites throughout the world:

  • Chemicals — specialty, fine, and commodity chemicals
  • Defense projects — ordnance and weapons systems assembly and test facilities
  • Food processing
  • Health care products
  • Life sciences — fine chemicals, pharmaceuticals, and biotechnology
  • Light manufacturing operations
  • Petroleum refining operations
  • Power generation
    • Pulp, paper, and forest products
    • Specialty fabrication and manufacturing operations

Our projects range from large manufacturing complexes requiring more than a thousand workers to small operations employing fewer than a hundred personnel.

Our projects have involved identification and evaluation of candidate industrial sites on a global scale. We have worked with economic developers and other resource groups at the local, state, and national levels. The scope of our services includes whatever is needed to support our client's project, which could include:

  • Initial screening studies to identify the broad geographic area(s) that best meets the client's needs.  Initial screening could include land considerations, environmental and social issues, raw material supplies, product distribution patterns, utility needs, labor requirements and community needs.
  • Identification, inspection, and detailed evaluation of candidate sites within a target region.
  Site Selection
  • Evaluation of regional and local economic development programs (e.g., tax and other economic incentives, labour recruiting and training programs, infrastructure development, etc.) for new and expanding industry.
  • Negotiations and purchase options for property on behalf of clients needing anonymity.

Our approach to site selection has the key objective to protect our clients interests, competitive position and to minimize the impact on their work force and operations at existing operations.  We aim to  avoid unwanted publicity and attention, and enhance our clients’ ability to acquire the chosen site under favorable terms.

For more information on our capabilities in this area, please contact us.

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