Folks, FEED is a normal part of the project engineering process...

Folks,

FEED is a normal part of the project engineering process cycle.
It is not something that is dreamt up to appease someone or give an illusion of doing something.
Front End Engineering Design for want of a more simpler word is preliminary engineering and yes you do impress the Lenders when you can demonstrate you totally understand the project costs involve.

The Feasibility Study is a  project initial estimate based on historical norms, referenced data of unit pricing/quantities . It is carried out under a definite methodology, it develops the scope, cost and estimate from a "back of fag packet" estimate that would have proceeded. It is done by an Engineering services company as typically no company has the extensive engineering resources and specialist knowledge in house; i.e. a Worley Parsons, SKM, Fluro, Calibre, etc . Typically you end up with a 20% estimate with high contingency estimates. The more time you can spend on the greater the confidence in estimate accuracy, scope, schedule and Risks.

It is typical to be done to demonstrate to Financiers what the risks to them are and that the project has accounted and mitigated them to acceptable levels of exposure. Lenders what as much certainty as possible before they will commit.

That is why a Definitive Feasibility study (DFS) is done in most cases after the Feasibility Study. The DFS involves even greater level of engineering (FEED) & administration effort to satisfy Financers, clarify Govt approvals/licenses, policy agreements, contracts etc., to chase down and quantity impacts of risks identified previously a just a number estimate in FS.

Therefore much more expenditure on design activities with expensive studies on geotechnic, environment, field surveying ,paying Vendors to provided better pricing info/specifications.
DFS is essentially preliminary engineering activity to get to a 10-15% level of accuracy overall as well as final handle on all the other non-engineering impacts.

The Financiers  will get a copy of the FEED and have their own Engineering consultants independently go through it challenging risks, scope, schedule, accuracy assumptions and contingency allowances. It becomes part of the legal documents for the Lenders.

The other important aspect of the FEED is it can be given to the potential EPC (engineering procurement construction) contractors bidding on the project . It helps set the basis of their bid and gives a common point of evaluating the competing Tenders for award of EP

In summary, FEED is important deliverable as part of the normal process towards getting funding approval.