From Bankable Feasibility to Financing: What Actually Happens After the Study

From Bankable Feasibility to Financing: What Actually Happens After the Study

A bankable feasibility study (BFS) is often talked about as the big milestone. In reality, it’s the gateway, not the finish line. The real work that turns a project into an operating asset starts once the BFS is in hand.

For investors, understanding what happens between “BFS completed” and “project built and cash‑flowing” is critical. That’s where financing, partners, execution risk and a lot of value creation (or destruction) actually sit.

After a BFS is completed, most serious projects follow a similar sequence:

                1. Board and Management Review
The first step is an internal one. The board and management team use the BFS to decide whether the project, on a fully risk‑adjusted basis, is robust enough to move toward development. This includes assessing NPV, IRR, payback, cost position, and downside scenarios and asking a simple question: “Is this a project we want to own through a full cycle?”

                2. Refining the Capital StructureWith BFS numbers in hand, the team can now design a realistic capital stack. That usually means a mix of:

                • Project finance debt

                • Equity (from the company, strategic investors, or new partners)

                • Potential offtake‑linked or royalty/stream components
The BFS underpins how much debt the project can reasonably support, what coverage ratios lenders will require, and how much equity needs to be filled in around that.

                3. Engaging Lenders and Strategic Partners
Banks, export credit agencies, development finance institutions, and specialist funds will dig into the BFS in detail. They’ll run their own credit models, sensitivity cases, and risk reviews. At the same time, potential offtakers or strategic partners will assess whether the BFS supports the volumes, quality specifications, and cost profile they need. This is where the study becomes the shared reference point for everyone around the table.

                4. Term Sheets, Due Diligence, and Conditions Precedent
Once there is indicative interest, the project moves into term‑sheet territory: draft debt terms, covenants, security, offtake frameworks, and equity participation. Alongside that, there is often additional confirmatory due diligence; site visits, legal and permitting reviews, technical audits all anchored on the BFS documentation. The goal is to turn “BFS results” into binding financing commitments and commercial agreements.

                5. Final Investment Decision (FID)
When financing, offtake, and key risks are sufficiently de‑risked, the board can take a Final Investment Decision. FID is effectively the green light to move into detailed engineering, procurement, and construction. For investors, this is usually the point at which execution risk begins to dominate project‑evaluation discussions.

                6. Detailed Engineering, Construction, and Ramp‑Up
Post‑FID, the BFS moves into the background as a baseline, and detailed engineering (often called FEED) takes over. Contracts are awarded, equipment is ordered, and construction begins. The project then passes through commissioning and ramp‑up to reach steady‑state operations. Variances from BFS assumptions, in capex, schedule, ramp‑up, and operating costs are what investors watch most closely in this phase.

For sophisticated investors and family offices, the key takeaway is that BFS is necessary but not sufficient. Strong BFS results can:

                • Unlock debt and strategic capital on better terms.

                • Provide a realistic roadmap for financing and development.

                • Reduce “unknown unknowns” and frame the remaining execution risk.

But they do not eliminate the need to scrutinize how management plans to fund, structure, and execute the project.

As we move toward our own BFS milestone, the questions that matter aren’t just “What are the NPV and IRR?” but also:

                • What kind of capital structure does the project really support?

                • What mix of lenders, strategic partners, and equity is appropriate?

                • How conservative are the financing assumptions relative to the BFS?                 • What are the key execution and schedule risks after FID, and how are they being managed?