It is not uncommon for the national oil company (NOC) of a developing country to encounter difficulties in obtaining project financing. Because of the instability of the country＇s economy credit is often reduced or withdrawn. If granted, credit typically is underwritten by proven reserves. However, the funds-flow problem becomes acute as an increasingly larger portion of existing reserves is provided to collateralize debt. This dilemma might be circumvented by switching to financing structures derived through use of the NOC＇s share of existing or proposed surface facilities as debt security. While the concept seems simple in theory, application of potential components of this type of financing can prove to be quite complex. Various elements must be considered in the equation that determines optimal borrowing terms. The inability to resolve or mitigate certain issues (political instability, facility life and alternative uses, operational hazards, existing production questions, taxes, and de facto partial ownership of assets by a financial institution) is the primary reason that the technique has not been widely developed and used. For favorably resolved issues to prove useful, they need to be presented in a manner acceptable to financial institutions. Additionally, requests for financing must fit the funding parameters of the chosen financing source. Therefore, developing a loan package that is palatable to the large financing syndicates often proves to be a rigorous and daunting task. When executed properly, however, this effort can release previously unavailable funds.