during construction that are recovered from offsetting against taxes on revenues
once operations begin.
§12.5 OPERATING REVENUES AND COSTS
Taking a process plant as an example, the main elements of operating cash flow
may include:
• Operating revenues from sales of products
minus
• Cost of fuel or raw materials
• The Project Company’s own operating costs (personnel, office, etc.)
(cf. §8.7.3)
• Maintenance costs
• O&M Contract costs
• Insurance (cf. §7.6.2)
The first stage in projecting the operating revenues, and the cost of fuel or raw
materials, in the model is to identify the key operating assumptions— e.g., for a
process plant:
• What is the initial output?
• How does this output change over time?
• How much time is needed for maintenance?
• How much time ...