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Technical Expertise

15 January, 2018

Evaluating the technical risks of large-scale projects

According to a PwC analysis of mega projects (those exceeding 1 billion US dollars) around the world, over three quarters of projects exceed their budget by at least 25 percent. More than half go over budget by 50 percent or more.
No matter if it is about financing a wind farm in Canada, the satellite launch by an Ariane 5 carrier from the spaceport in French Guyana, a LNG processing plant in icy north Siberia or a pipeline in the Baltic Sea, the key success factors are the same:

  • accuracy of the overall technical concept,
  • quality of the technical components,
  • management of interfaces as well as
  • knowledge and experience of all the construction contractors involved.

Our approach

Technical concepts are getting increasingly complex and risks need to be quantified. In this environment, ECAs regularly seek support from independent advisors in order to evaluate the technical feasibility of a project. PwC assists ECAs during the whole project evaluation process to make sure they are always aware of the adequacy of the technical concept and hidden technical risks, which could lead to delays and cost overruns. The sizing of contingencies, liquidity reserves and minimun cash balances is crucial for the viability of large-scale projects.

Contact us

Heiko Lentge

Heiko Lentge

ECA Advisory & Financial Modelling, PwC Germany

Tel: +49 40 6378-1440

Alexander Wuermeling

Alexander Wuermeling

ECA Advisory, PwC Germany

Tel: +49 40 6378-1426

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