The cheapest analysis is the one that stops you spending on a project that was never going to work.
Independent analysis is sometimes treated as a cost to be minimised. The better way to see it is as the cheapest insurance a resource company can buy, because its main job is to stop you spending far larger sums on a project that was never going to clear the bar.
A company assessing its own project carries an unavoidable bias. Time, money, and conviction have already gone in. The evidence tends to be read in the project's favour, and the assumptions that would undermine it tend to be the ones that go untested. None of this is dishonest. It is simply what proximity does.
An independent view has no such stake. Its value is in the questions it is willing to ask: does this work at prices that will actually occur, is the offtake real, is the capital requirement matched to the stage, and what is the one assumption that, if wrong, breaks the case. Those are the questions a lender will ask, and it is far better to face them early, from an adviser, than late, from the capital you were counting on.
Where a project stands up, independent analysis strengthens the funding case, because the work has already been scrutinised. Where it does not, it saves the larger spend that would have followed. Either way, it earns its fee.
The standard that matters is whether the analysis would survive being put in front of a board, a partner, or a lender. If it would, it is doing its job. If it would not, it was never analysis in the first place.
Note
This note is general information and the view of M M Capital and Research. It is not financial advice, a recommendation, or an offer. MMCR is not FCA regulated and arranges unregulated commercial finance. Capital is at risk.