Legal Definitions - single-purpose project

A single-purpose project is a facility that is designed, built, and used for one specific purpose only. This could be anything from generating electricity to mining minerals. These projects are typically large, complex, and expensive.

One common way to fund single-purpose projects is through project financing. This involves creating a special-purpose entity that is solely responsible for developing, owning, and operating the facility. By limiting the number of creditors, this provides protection for the project's lenders.

• A power plant that generates electricity
• A chemical-processing plant that produces a specific chemical
• A mine that extracts a particular mineral
• A toll road that charges drivers for using it

These examples illustrate the concept of a single-purpose project because each facility is designed and used for one specific purpose only. For example, a power plant is built solely to generate electricity, while a mine is constructed to extract a particular mineral. These projects require significant investment and are typically funded through project financing.