Markedly Higher LeverageA sharp rise in leverage reduces financial flexibility and increases refinancing and covenant risk. With a thinner equity cushion, adverse commodity or project shocks more quickly force restructuring, asset sales or dilutive equity raises, all of which can impede long-term project delivery and shareholder value creation.
Persistent Negative Cash FlowSustained negative operating and free cash flow necessitates ongoing external funding for operations and capex. Over months, this raises the probability of dilutive financings, higher-cost debt or slowed investment in phase completion, weakening the company's ability to capitalize on near-term production and contracted sales.
Execution Delays And License RiskProject timing and permitting slippages increase capex uncertainty, push out revenue realization and can erode contracted economics or tax-window benefits. Persistent execution risk can escalate costs, strain partner relationships and delay the cash flow needed to reduce leverage, undermining medium-term recovery prospects.