Most investors who have experienced the development of a greenfield project in the agro-industry, be it a sugar plant, an ethanol plant or any other facility in this sector, knows perfectly well that the route is quite complex and paved with numerous pitfalls, more particularly when on a fast track execution schedule.
Only a true FEED can provide a sound basis for the project feasibility study and its further implementation. It is essential to analyse the project’s technical requirements so as to reach a proper project definition. During a first iterative process, CAPEX and OPEX of different technical solutions will have to be studied and challenged with the investor in order to provide a precise investment scope which will then lead to a more elaborate and accurate business plan. This step is also key to avoid during the project construction significant changes and their resulting cost overruns and delays.
During the FEED, a purchase strategy will have to be elaborated and, depending on its own resources and lenders requirements, the investor will have to decide whether to go for an EPC, EPCM or alternative contracting set-ups.