Wert-Berater, Inc. is an independent industrial gases feasibility study consultant preparing lender-, investor-, and agency-facing studies for air separation units, on-site and over-the-fence gas supply, bulk liquid and cylinder distribution, medical and specialty gas operations, and carbon dioxide and acetylene plants. Industrial gas is an anchor-contract business with a heavy power bill: a plant is financeable when a creditworthy anchor customer has committed to take-or-pay volumes for a term matching the debt, and it is fragile when it is not. The analysis begins with that contract and with the electricity price behind it.
Fiduciary duty runs to the lender and the agency, never the borrower. Fixed fee quoted within one business day; standard delivery in ten to fifteen business days from a complete data room. 4,000+ engagements since 1998 covering $41.2 billion in evaluated project value. So far in 2026: 41 engagements and $1.54 billion evaluated — 17 SBA, 11 USDA.
Industrial-gas feasibility rests on anchor offtake and distribution radius: the on-site or pipeline customer behind an air-separation or hydrogen unit, merchant liquid demand within economic delivery distance, power cost as the dominant operating input, and contract structures — take-or-pay, cost pass-through — that determine credit quality. Specialty and medical gas operations are evaluated on certification position and channel relationships.
Methodology uses regional industrial-demand mapping, contract review, power-rate analysis, and capital benchmarks by plant type. Coverage is tested on anchor-contracted volumes before merchant contribution.
Every Wert-Berater financial model is fully linked with no hardcoded values, so any reviewer can stress any input. Deliverables comprise a complete narrative report and the linked Excel model, with ten-year pro forma, sensitivity analysis at ±5, 10, and 15 percent, interest-rate stress from +0.5 to +3.0 percent, and ratio analysis benchmarked against RMA and IBISWorld data.
SBA engagements are prepared to SOP 50 10 8, including its debt-service-coverage minimums of 1.15x operating and 1.00x global. USDA engagements follow RD Staff Instruction 5001 across the Business & Industry, Community Facilities, REAP, and Value-Added Producer Grant programs. Conventional engagements are built to the lender's stated coverage standard, typically 1.20x. Oil, gas, and heavy-industrial projects reach us through conventional and institutional lending most commonly, with USDA B&I applicable to qualifying rural energy and processing assets and SBA programs serving owner-operator support businesses; each study is prepared to the corresponding compliance standard, with environmental and regulatory conditions precedent stated plainly.
Wert-Berater has not published a completed air separation or industrial gas distribution engagement as a public case study, and none is claimed here. The firm has completed and published a clean ammonia and hydrogen production facility feasibility study in Taft, California — a gas-production engagement in the same analytical family, where energy intensity, conversion efficiency, contracted offtake, and construction risk determine the credit exactly as they do for an air separation unit. That is the honest connection; a hydrogen and ammonia plant is not an ASU, and it is not presented as one. Across 4,000+ engagements since 1998 the discipline is constant: fully linked models with no hardcoded values, assumptions sourced and footnoted, and coverage tested under downside cases before a determination is issued. Independence is non-negotiable, and determinations are not revised under pressure.
An industrial gases feasibility study consultant establishes whether contracted volumes, produced at the plant's achievable output and delivered within its economic radius, cover the power bill, the fixed cost, and the debt service. The analysis is built in that order because the sector's economics are unusually rigid: production capacity is fixed by the installed equipment, electricity is the dominant variable cost, and distribution cost rises steeply with distance, so the addressable market is narrower than a regional demand figure suggests.
The engagement is economic and financial. Wert-Berater does not perform process, cryogenic, mechanical, or electrical engineering, does not design or rate separation columns, compressors, or storage vessels, and does not issue process-safety or gas-purity certification opinions. Engineering designs, capacity ratings, and capital estimates prepared by qualified firms are treated as inputs and tested for internal consistency against the production plan and financing structure.
A feasibility study for an industrial gas project is not a generic business-plan summary. The scope is built around the specific plant type — air-separation unit, steam-methane reformer, electrolytic hydrogen, or merchant liquid-fill operation — because each carries a different cost structure, customer base, and regulatory exposure. The study opens with a plant-configuration review that ties nameplate capacity to the contracted load, then works outward to the merchant market.
Capacity is modeled by product rather than in aggregate, because an air separation unit produces oxygen, nitrogen, and argon in a ratio the configuration largely determines, and those products carry very different values. A plant optimized for one product generates co-products whose sale depends on separate customers and separate logistics, and where the pro forma assumes all co-product volume is sold, the study tests that against identified demand and reports any volume that would in practice be vented or unsold.
Achievable output is modeled net of planned maintenance, unplanned downtime, and the commissioning ramp between mechanical completion and stable on-specification production. Purity requirements are treated as a constraint, since medical, electronic, and food-grade applications carry certification obligations and quality-system costs that general industrial supply does not. Liquefaction capacity, storage volume, and vaporization capability are examined against the delivery profile, because a plant that cannot store enough product to buffer demand peaks is effectively smaller than its rated output.
The anchor customer is usually the reason the plant exists, and the contract is examined as executed. The study records committed volume, the take-or-pay or minimum-purchase obligation, primary term and expiry, pricing and its escalation or power-cost pass-through mechanism, and termination and change-in-law rights. Whether a power cost increase can be passed through to the anchor customer is one of the most consequential terms in the entire credit, and it is identified explicitly rather than assumed.
Contract term is compared directly against the loan amortization. Where the anchor agreement expires first, the study reports the year contracted revenue ends and models coverage on stated renewal assumptions. Anchor counterparty credit is assessed on its own merits, and coverage is re-tested on the loss of that customer, because a plant built around a single offtaker has limited alternative use if the offtaker leaves. Merchant and cylinder volume is modeled as a separate layer built from identified customers rather than from regional consumption, and is not used to carry the base case.
Industrial gas is expensive to move relative to its value, so the supply mode defines the market. The study distinguishes on-site or over-the-fence supply, pipeline supply to a co-located customer, bulk liquid delivery by tanker, and packaged cylinder distribution, and models each on its own cost basis. Bulk liquid economics depend on tanker fleet, drops per day, drop size, and round-trip distance; cylinder economics depend on the fill plant, cylinder asset base, and the route density that determines cost per unit delivered.
An economic delivery radius is established for each mode and becomes the market boundary for demand analysis. Inside that radius the study identifies the actual industrial base consuming gas — fabrication and welding, metals, food processing, healthcare facilities, water treatment, electronics — and the competitors already supplying them, including whether incumbents hold customers under multi-year supply agreements. Cylinder operations receive particular attention on asset control, since cylinder loss and unrecovered rental are a persistent margin leak that sponsor projections routinely omit.
Electricity typically dominates the operating cost of an air separation plant, so the study models the actual tariff rather than an average cost per unit. That means the energy charge, the demand charge and how it is set, time-of-use differentials, any interruptible or curtailable rate and the operational conditions attaching to it, and the contracted term of the supply arrangement. Specific power consumption per unit of product is taken from the equipment rating and applied across the actual operating profile, since part-load operation raises consumption per unit.
Operating leverage is the defining risk. A plant with high fixed cost and a dominant power bill loses money quickly when volume falls, so the study reports the utilization level at which the plant stops covering cash cost, separately from the level at which it stops covering debt service. Coverage is stressed against sustained electricity price increases at several levels, and where the anchor contract permits power pass-through, the protection that provides is quantified rather than assumed complete.
Demand analysis for an industrial gas project begins with the anchor customer, not the regional market. If a single on-site or pipeline customer represents the majority of projected revenue, that customer's financial condition, production continuity, and contract enforceability are examined before any merchant volume is credited. Only after anchor coverage is established does the study turn to the broader market.
Merchant demand is built from the bottom up. Industrial consumers — metal fabricators, food processors, chemical plants, healthcare facilities — are identified through state business licensing registries, EPA facility emissions inventories, and Occupational Safety & Health Administration process-safety management databases, all of which disclose the presence and approximate scale of gas-consuming operations without requiring proprietary purchase data. Cylinder-exchange and bulk-delivery competitors are identified through state hazardous-materials permit filings, DOT special-permit registries, and trade-association member directories. Pipeline infrastructure is mapped against FERC and state utility commission filings. For hydrogen projects, utility interconnection queues and state energy-office renewable-fuel registries reveal the pace of fuel-cell and industrial-hydrogen demand growth in the corridor. Medical and specialty gas demand draws on state pharmacy board and FDA establishment registries. Each source is cited in the narrative so a lender or agency reviewer can verify the count independently, without relying on the analyst's assertion alone.
A small number of inputs drive most of the variance in an industrial gas pro forma. Identifying them early, and stress-testing each independently, is the core discipline of a credible study. The following assumptions receive explicit scenario analysis in every Wert-Berater engagement for this asset class.
Each assumption is a live cell. Any reviewer can substitute their own figure and read the coverage result immediately.
Inputs resolve into a fully linked model with no hardcoded values, producing a ten-year pro forma, annual and period debt-service coverage, and the coverage minimum applicable to the financing program. Construction and commissioning are funded inside the model with interest during construction shown explicitly, and anchor-contract revenue, co-product sales, merchant volume, and cylinder rental income are reported as separate layers.
Sensitivity is run on plant utilization and availability, electricity price and demand charge, anchor contract renewal and loss of the anchor customer, co-product sales realization, merchant volume ramp, distribution cost per unit delivered, construction cost overrun and commissioning delay, and interest rate. The study identifies the utilization and power-price combination at which coverage reaches the lender's minimum. Engineering designs, capacity ratings, and capital estimates prepared by qualified firms are used as inputs; this study does not replace process or cryogenic engineering.
Credit officers and agency reviewers approach industrial gas projects with a consistent set of concerns, and a well-constructed feasibility study addresses each one directly rather than leaving the underwriter to fill gaps.
For SBA 7(a) and 504 engagements, the primary concern is global cash-flow coverage at the 1.00x minimum and operating coverage at 1.15x. Because industrial gas borrowers are often owner-operators of support businesses — cylinder distributors, specialty gas blenders, small merchant producers — the global analysis must consolidate all entities and all personal obligations. The study states the coverage ratios explicitly and flags any year in the ten-year horizon where a sensitivity scenario breaches the minimum.
For USDA Business & Industry and REAP engagements, rural location and energy-nexus eligibility must be established before the financial analysis begins. Hydrogen and renewable-gas projects may qualify under REAP's renewable-energy system definition; the study states the basis for that determination and identifies any conditions — such as interconnection approval or feedstock-supply contract execution — that must be satisfied before closing.
For conventional lenders, the typical 1.20x coverage standard is applied, but institutional lenders on larger projects frequently add a minimum debt-service reserve and a covenant tied to the anchor offtake contract. The study models the reserve-funded scenario and notes the covenant trigger level so the credit memo can reference it directly.
The engagement begins with a fixed-fee quote, delivered within one business day of the initial inquiry. The fee does not change based on the finding, and no portion is contingent on a favorable determination. That structure is not a marketing position; it is the condition that makes the study credible to a lender or agency reviewer who knows that a contingent fee creates an incentive to reach a predetermined conclusion.
Once the fee is accepted, the firm issues a data-room checklist specific to the plant type and financing program. A complete data room for an industrial gas project typically includes the offtake contract, power-supply agreement or utility rate schedule, engineering cost estimate, site-control documentation, any existing environmental permits or permit applications, and the borrower's three most recent years of financial statements. The standard delivery window is 10 to 15 business days from the date the data room is confirmed complete. Rush delivery is available for time-sensitive closings.
The completed study — bound narrative report and fully linked Excel model — is published to a secure client portal. The financial model remains live: if a lender asks what happens to coverage if power rates rise 20 percent or the anchor customer calls only the take-or-pay floor, the analyst can update the model in the portal and the reviewer sees the recalculated result without waiting for a revised report. The engagement closes with an explicit conditions statement listing every item that must be resolved before the financial projections are supportable as presented.
Industrial gas plants are built beside the customers and utilities that determine their economics. These engagements cover the connected facilities.
Wert-Berater quotes a fixed fee within one business day of the initial inquiry. The fee is stated before any work begins and does not change based on the outcome. No portion is contingent on a favorable finding. The exact figure depends on plant type, financing program, and data complexity; contact the firm directly for a same-day quote.
Standard delivery is 10 to 15 business days from the date a complete data room is confirmed. Rush delivery is available for time-sensitive closings. The clock starts when all required documents — offtake contract, power agreement, engineering estimate, site control, and borrower financials — are in hand. Incomplete data rooms are the most common cause of delay.
Three factors create underwriting complexity unique to this asset class: power cost is both the dominant operating expense and a variable the borrower does not fully control; revenue concentration in a single anchor offtake customer means one contract event can breach coverage; and merchant pricing is set by regional competitors whose capacity additions are not always visible in public data. A credible study addresses all three explicitly.
No. SBA and USDA B&I operate under separate instructions with different coverage standards, eligibility tests, and documentation requirements. A study prepared for one program must be adapted — not simply relabeled — for the other. Wert-Berater prepares each study to the specific compliance standard of the financing program named at engagement, and states that standard on the cover page.
The core data room includes the executed or draft offtake contract, the power-supply agreement or utility rate schedule, a third-party engineering cost estimate, site-control documentation, any environmental permits or permit applications, and three years of borrower financial statements. For hydrogen projects, feedstock-supply agreements and any interconnection queue filings are also required. The firm issues a checklist specific to the plant type at engagement.
No study can guarantee a financing outcome, and Wert-Berater does not represent that it can. The study presents an independent determination of financial feasibility based on the evidence in the data room, tested against the applicable lending standard. The determination follows the evidence. If the evidence does not support a positive finding, the study says so — that independence is what makes the report credible to the reviewing institution.
The consultant examines the anchor contract and its take-or-pay terms, achievable plant output by product, the economic delivery radius for each supply mode, and the electricity tariff that dominates operating cost, then tests coverage across the loan term. The work is economic and financial; process, cryogenic, and electrical engineering are separate disciplines used as inputs.
A plant built around a single offtaker has limited alternative use if that offtaker leaves, so the anchor agreement is examined as executed and coverage is re-tested on its loss. Committed volume, take-or-pay obligation, term and expiry against the amortization schedule, pricing escalation, and any power-cost pass-through are each identified rather than assumed.
Capacity is modeled by product rather than in aggregate, because the configuration largely fixes the ratio of oxygen, nitrogen, and argon and those products carry different values. Where the pro forma assumes all co-product is sold, the study tests that against identified demand and reports any volume that would in practice be vented or unsold.
From the actual tariff rather than an average cost per unit: energy charge, demand charge and how it is set, time-of-use differentials, any interruptible rate and its operating conditions, and the contracted term of supply. Specific power consumption per unit is taken from the equipment rating and applied across the real operating profile, since part-load operation raises consumption.
A plant with high fixed cost and a dominant power bill loses money quickly when volume falls. The study therefore reports the utilization level at which the plant stops covering cash cost separately from the level at which it stops covering debt service, and stresses coverage against sustained electricity price increases at several levels.
Each supply mode is modeled on its own cost basis. Bulk liquid economics depend on tanker fleet, drops per day, drop size, and round-trip distance; cylinder economics depend on the fill plant, cylinder asset base, and route density. An economic radius is established for each mode and becomes the boundary for demand analysis rather than a regional consumption figure.
Yes. Cylinder loss and unrecovered rental are a persistent margin leak that sponsor projections routinely omit, so cylinder asset control is examined directly and modeled as a cost. The cylinder asset base and its replacement cycle are also carried as capital rather than treated as a one-time purchase.
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Wert-Berater, Inc. is an independent provider of feasibility studies and other related services. The firm does not provide financing or equity investment advice, and does not arrange, broker, or place debt or equity capital of any kind.
All appraisal assignments are performed by Bruce E. Jones, MAI, ASA-GC, BCA, CMEA, a member of the Appraisal Institute since 2006, a staff member of Wert-Berater, Inc. and owner of Special Purpose Realty Valuation.