In preparation for our financing items, let's first go to our sources and use of funds table and fill out our working capital line. Now these working capital changes will need to be funded and we can compute this number from our calculations tab by taking this year's operating working capital balance minus last year's working capital balance. Here we get 0, but as we copy this to the right, we see that we get a 2 during the last year of the construction phase, and that's because we're assuming that there is a bit of an inventory buildup toward the end of the construction period.

Let's go back to our finance tab and start working on our first financing item, which is the revolving credit facility. Let's first take the interest rate and the commitment fee assumptions from our sources and uses tab. Here we have an interest rate of 4% for the revolving credit facility, which is simply 2% spread over LIBOR, and we also have a commitment fee of 1%.

Now the commitment fee, of course, is a bank charge on the undrawn portion of the revolving credit facility. Banks are required by the regulators to allocate equity capital to any facilities they provide clients, whether they're drawn or undrawn. So in this case, the bank will charge the project a 4% interest rate on the drawn portion of the facility and a 1% commitment fee on the undrawn portion of the facility. So let's go ahead and model out our revolving credit facility, starting with our beginning balance in a little base calculation that's gonna be equal to 0. Remember, the revolving credit facility is not drawn upfront.

We're gonna skip the drawdown repayment line for now, and we're gonna compute simply the sum of the beginning balance and the drawdown repayment line as the ending balance.

Now we can compute our interest expense by taking our interest rate. We locked that in and we multiply these times the average balance between this year and last year. One last thing is we wanna make this interest expense negative, so let's put a minus sign in front of it.

Now we can copy this right across all the construction years and the first operational year where we can actually model out our drawdown and repayment. Now for this, we're gonna be using a negative min formula.

So we'll take negative min off the beginning balance and our cash available for debt repayment.

Now the reason we use a negative min function is because this little function will take care of multiple scenarios. For example, if your cashflow available for debt repayment is less than your outstanding balance, then you'll only pay down as much as the cashflow available the project has. If the cashflow available is more than the beginning balance, then of course you can pay off your entire beginning balance. And in the case where the cashflow available is actually negative, you will then draw down on this revolver to cover that deficit. So this negative min formula takes care of all the potential scenarios in terms of how much cash is available for debt repayment and what is the actual outstanding debt, for this facility. So let's go ahead and move on to our next step. And our next step is to compute our commitment fee. Now, to get our commitment fee, we first need to determine what is the undrawn portion of the facility or the unused facility. So we can do that very easily by taking the assumption of the facility size that we have on our sources and user tab. So if we go back here, we have a hundred as the facility size, we can lock that in and we can subtract from that the ending balance on that facility. Of course, right now it's 0, and then we can copy that to the right across these four or five years.

Now our commitment fee is gonna be calculated in a very similar way as we calculated interest expense. We're gonna take the 1% commitment fee, we're gonna lock that in and multiply times the average balance of the unused facility. Now don't forget to put a negative sign in front of this as we want the fee to be a negative value. We can of course, copy this to the right.

And finally, we can calculate the total cash interest, and that includes both the interest paid on the drawn portion as well as the commitment fee. So we can simply take the interest expense plus the commitment fee, and this is the number that is gonna go into the income statement. Let's copy this to the right. Let's take a quick look at the formulas here before we take all of our formulas for the revolving credit facility and we copy them all the way to the right until the very last year of our operation of phase.