Seminar

This paper contributes to the literature of qualitative and quantitative analyses of the determinants of the debt ratio in project finance, using data on 27 liquefied natural gas (LNG) projects. We can empirically show that the debt ratio of an LNG project decreases with increasing risks associated to future cash flows. Estimation results confirm that external fund-raising increases with higher shares of a project’s capacity sold under long-term contracts, with lower capital intensity of the project, and with a lower risk index of the country where the project is located.