The economic and financial feasibility studies comprised both a review of the general considerations involved in devising a financing plan for the Dunn-Nokato Project and quantitative analyses of project economics based on a computer model. Since The Nokota Company does not have the financial resources to provide the equity capital necessary to fund the Project, and since other equity sponsors have not yet been identified, a definitive financing plan cannot be determined at this time. However, an investigation of the characteristics necessary to any suitable financing plan for the Project was undertaken, included in: (1) a survey of possible sources of debt funds; (2) a discussion of the risks as perceived by lenders and the ways in which these can be addressed; (3) an analysis of the considerations involved in selecting a legal and financial structure; and (4) a review of available government support options under the Energy Security Act. The results of this work are summarized. The quantitative analysis developed pro forma financial statements over the life of the Project, calculated relevant rates of return for the Project, and generated various statistical measures of Project creditworthiness, based on information supplied by Nokota and Project consultants. These analyses indicate that, under the scenario judged to be most reasonable by Nokota and Project consultants, the Project is economically and financially viable. The economics of the Project under the base case design alternative were compared to the economics of other process design alternatives for which cost and output estimates had been prepared by Fluor. In addition, sensitivity analyses quantifying the effect of changes in key assumptions were performed.
