Lenders' Independent Engineer
Medium and large size industrial, infrastructure and construction projects, with high level of capex, pose a major risk to the lenders in view of the higher order financial exposure.
Lenders' Engineer (LE) or Lenders’ Independent Engineer (LIE) forms the crucial in assessing the premises on which the project concept is built, monitoring physical and financial progress in defined periodicity, thereby mitigating risks for lenders and investors. Thus, an LIE/ LE is an independent entity appointed by the financer to safeguard their interest.
Some of the important responsibilities of an LIE / LE are:
- Project Technical Appraisal: LIEs evaluates the project's technical feasibility including, design, construction plan, technology selection, process parameters, implementation methodology, implementation timeline and capex to provide an independent opinion on these considerations.
- Progress Monitoring: LIEs periodically monitor project physical and financial progress, against original plan. LIEs prepare the S-curves to identify the lead/ lag factor in project implementation. This helps lenders in tracking the instances of time and cost over-run.
- Risk Mitigation: LIEs identify probable technical risks that could hinder project completion. These insights help minimize implementation risks.
- Quality Assurance: LIEs review the quality of construction to verify them meeting the requirements. During project completion, LIE also overseas commissioning tests and certify the production/ productivity and product quality.
- Drawdown Certificate: The scope of LIE often includes validation of capex incurred on a project, utilization of fund released by the bank/ financial institution and comment on the drawdown requirement for a stipulated future period.
- Reporting: : LIEs analyze and prepare reports consisting of above stated information submit it with the lender for making informed decisions.
Adroit has proven experience and robust team in offering LE/ LIE services across sectors.
