The primary goal of due diligence activities is to assess and mitigate technical, financial, environmental, legal and socio-economic risks associated with a project before committing further resources. In carrying out due diligence work, our highly experienced specialists work alongside client appointed financial, legal and insurance advisers to provide a comprehensive assessment of these risks, devise suitable risk mitigation strategies and ensure that the project represents a viable investment.

Due diligence assignments typically involve the review and verification of the findings of a feasibility study conducted for the project. Project aspects we assess during the course of due diligence assignments include:

  • The viability of the market situation
  • Raw materials availability
  • Choice of technology option(s)
  • Utilities and site requirements
  • Personnel and training requirements
  • Environmental assessment (including adherence to Equator Principles and other applicable standards)
  • Estimates of capital costs and return on investment
  • Market position and competitive analysis
  • Scenario modelling
  • SWOT Analysis
  • Project and operational risk assessment

As part of due diligence activities, we also review from a technical viewpoint:

  • Raw materials supply agreements
  • Market off-take agreements
  • Equipment supply and Engineering, Procurement and Construction (EPC) contracts
  • Utility supply contracts
  • Operation and management contracts

McLellan specialists liaise with insurance advisors to ensure the validity of the assumptions used in calculating levels of marine cargo insurance and insurance during construction for projects. We also provide advice to the lenders in connection with performance testing and the structure of a final lenders test for industrial plants; a key component of project completion.