A detailed, institutional-grade gas distribution financial model built for a proposal to establish an LNG sales and distribution system — with three integrated statements, a cash waterfall, valuation and the full set of lender covenant metrics, in Excel.

Project finance is the financing of long-term infrastructure on the strength of the asset itself. Both debt and equity fund the project, and the debt is repaid from the cash flow the project generates — not from the balance sheets of its owners. That structure puts enormous weight on the model. If the projected cash flows cannot service the debt, the project does not get built, however attractive the underlying opportunity looks.

This gas distribution financial model is built for exactly that decision. It captures the full chain of a gas sales and distribution proposal — the carrier, the pipeline, the volumes sold and the cost of fuel — and resolves them into the metrics a sponsor, developer or lender needs to judge whether the structure holds together.

The outputs are the standard project finance suite: Project and Equity IRR and NPV, minimum and average DSCR, equity payback, a full cash waterfall and the debt service profile — the numbers a financing decision actually turns on.

The Full Distribution Chain

A gas distribution business is a chain, and every link carries capital cost. The gas distribution financial model handles each explicitly — LNG carrier purchase and conversion capex at one end, pipeline and submarine capex in the middle, and offtake at the other.

Volumes are split between gas sold to a power plant and gas sold to third parties, which matters more than it might appear. A power plant offtake is typically contracted and predictable; third-party sales are more variable but often better priced. Modelling them separately lets you test how the balance between anchor offtake and merchant sales affects both returns and debt capacity.

Assumptions You Control

Every driver of viability is an explicit, editable input. The assumptions cover:

Lender & Investor Outputs

This is where the gas distribution financial model earns its keep — resolving your assumptions into the metrics a financing decision turns on:

• Project IRR & NPV — returns to the project as a whole
• Equity IRR & NPV — returns to shareholders after debt service
• Minimum & Average DSCR — the debt service coverage lenders scrutinise first
• LLCR & PLCR — loan life and project life coverage ratios
• Equity Payback Period — time to recover shareholder investment
• Cash Waterfall & Debt Service Profile — the full cascade of cash through the structure
• Gearing Ratios & Integrated Statements — leverage metrics alongside income statement, balance sheet and cash flow

A Model to Learn From, Not Just Use

Beyond producing numbers for a specific proposal, this model is a working demonstration of how infrastructure project finance is put together. Work through it and you will see, in practice, how flexible capital structuring feeds the debt schedule, how a cash waterfall cascades through the priority of payments, and how DSCR, LLCR and PLCR are each constructed from the underlying cash flows.

That makes it useful for two quite different purposes: assessing a live gas distribution proposal, and refreshing or building project finance modelling skills against a real structure rather than an abstract example.

Who This Gas Distribution Financial Model Is For

• Gas distribution and LNG developers building the case for a new distribution system
• Oil and gas companies evaluating downstream distribution opportunities
• Infrastructure investors and sponsors assessing returns and structuring equity
• Lenders and debt advisors testing coverage ratios and debt sizing
• Project finance analysts looking to build or refresh modelling skills on a real structure

Why This Model

New to these metrics? Read an overview of the debt service coverage ratio. For a model built to your own specification, see our project finance advisory services, or browse the full range of PPP and project finance templates.