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2.5 Drivers for realization of industrial projects

Drivers for the development and realization of industrial projects are different for every stakeholder. The type and level of of return stakeholders expect is to is a to large extend depending on their interest in the project.

Table 1: Drivers for realization of industrial projects

Table 1: Drivers for realization of industrial projects

The rational for investment and therefore for the development and realization of industrial projects are driven by demand growth, price competitive production or added customer value.

Stakeholders interest in Industrial Projects5
Sponsor/ developer/ owner
  • Strategic investment if sponsor is also marketer of product, feedstock supplier
  • Project development as corporate strategy
  • Interested in return on investment
  • Might want to exit the project at some point
Government, society
  • Interested in development of national industry and infrastructure
  • Adding value to natural resources
  • Substitution of imports through local products
  • Employment
  • Know how transfer and people education
  • Developing industrial infrastructure
Lenders / Financial Advisor
  • Large volume loan
  • Advisory fees
  • Interest rate
Feedstock Supplier
  • long term off-take
  • long term feedstock price might be negotiated/ market independence
  • might participate in ownership or preinvestment and investment phase to support realization; this might especially be the case when the infrastructure to market the feedstock is not yet available
Product off-taker/ marketer
  • Long term product supply
  • long term product price might be negotiated/ market independence
  • might participate in ownership or preinvestment and investment phase to support realization; this might be the case when the production is cost competitive
Operator
  • Operating fee
Technology provider; General Contractor; Suppliers; Erection companies
  • General business interest
  • Might participate in ownership or preinvestment phase to support realization or to have influence on the scope of the project

Table 2: Stakeholders interest in industrial projects5

5 Cf Reuter p 25ff