Technical Due Diligence of investment projects and assets
Due Diligence of an investment project or an existing company is traditionally the most popular type of engineering services.
Due Diligence of the project can be initiated by different parties:
- New investors in the project willing to make assessment of associated risks
- Investors or general contractors who make a decision to carry out Due Diligence in the course of disputes
- Foreign general contractors not meeting requirements of the Russian standards
- Industry regulators (for example, Ministry of Energy of Russia and “Market Council” NP are regulators in power industry)
Realization of an investment project often runs into tough problems. There comes a time when the investor feels that budget of the project has already exceeded expectations, and construction finishing date is not visible yet. The general contractor is not satisfied with the constant change of teams on the part of the customer, with chaos in agreements and blurring of responsibility. The general designer, in its turn, is not ready to change once again the design documentation free of charge due to the change of the project concept. All this happens against the background of delays in utility connection (including, the power distribution scheme) due to sluggishness of some third parties (infrastructure organizations). The imported equipment gets rust while waiting for the start of assembly, and it is getting obvious to everyone that huge service and maintenance costs were not included in the business-plan. The project rapidly goes down the drain. In such cases, Due Diligence often allows to rapidly assess main problems, reasons of their occurrence, risks and to develop a “road map” of crisis recovery with minimum losses for customers.
Due Diligence is carried out at the stages of:
- Conceptual project planning, formulation of the project idea
- Feasibility study, development of design documentation
- Civil and erection works, pre-commissioning
- Construction delays
- Facility commissioning
Non-state expert examination of the design documentation before submitting it to Glavgosexpertiza (Main State Expert Design Review Board in Russia) is a special case of Due Diligence. Such an expert examination allows to determine the most common errors admitted by design engineers at early stages, and finally can increase the probability of getting a positive conclusion from Glavgosexpertiza, and to raise project efficiency, in general, due to the project decisions optimization.
EF-TEK team is experienced in more than one hundred of Due Diligences in different investment projects.