The thrust of the mainstream's attack is aimed at TDJ's ability to manage effectively the full financing process. Says one: 'They're not a bank, they don't lend; so how can they really understand a transaction from the lender's perspective, from documentation to syndication risk?'

The blow is parried by TDJ's chairman and chief executive officer Terry Newendorp. 'The whole point of our business is that we are independent and that we don't compromise on this,' he said in a 28 June interview with MEED. 'Because we are not a bank we have the freedom to recommend what's right and best suits the client without worrying about what might generate the best fees further down the line.'

Some competitors also assert that TDJ is undercharging and trying to buy market share. One particular rumour suggests TDJ only charged $50,000 for a year's work it did on Alba's first phase advisory mandate. This Newendorp also refutes: 'We've never priced anything as a loss leader. Yes, the scope of works changed on the first phase Alba advisory and the contract was extended, but we worked things out with Alba.'

TDJ might have built its business plan on the appetite for truly independent advisory services, but the argument still needs winning in the Gulf. Some of the most regular users of project finance in the region have, to date, followed very different reasoning. It has often been the case that banks willing to offer sizeable underwriting commitments have often found themselves well positioned when bids have gone in for advisory work. Equally, there are a number of banks that have based their regional strategy on providing full services: the approach is based on their experience that regional institutions enjoy familiarity and commitment, rewarding with advisory mandates those banks that have used their balance sheet in the past.

TDJ is out to change the paradigm. 'The global trend is towards independent advice. You can see it everywhere from New York to South America,' said Newendorp. 'And with the Alba mandate, we've settled the debate here.' Supporting the case for independent advisory services are the current high levels of liquidity in the regional commercial debt market: strong bank appetite places more emphasis on good structuring and the careful exploration of all available options.

However, the appetite for non-bank financial advice has not grown evenly throughout the region. 'Some sponsors continue to be totally price sensitive, and we have a tough time winning mandates from them,' he said. Banks anticipating healthy underwriting fees are in a position to lower their charge for the advisory side and make it up later in another part of the transaction.

Alba may be the breakthrough mandate for TDJ, but it is not its first. Perhaps the two most high-profile advisories it has won have been for the power and water project in Fujairah sponsored by the UAE Offsets Group (UOG), and the advisory mandate for Qatar's proposed third liquefied natural gas (LNG) train at Ras Laffan, subcontracted to TDJ by Goldman Sachs.

'The Middle East is a very important region to us,' said Newendorp. 'Deal volumes are increasing and our staffing levels are rising. We are growing while our competitors are culling or reallocating their staff.'

TDJ has its main offices in Washington, London, Houston and Madrid. It also has an office in Cairo, an agreement with Bahrain-based Islamic Financial Consultantsand a joint venture agreement with Saudi Arabia- based Arab Petroleum Investments Corporation (Apicorp)that allows staff to be placed in Saudi Arabia as deal flow demands. 'The Apicorp situation has worked well - we have a couple of deals that will reach financial close by the end of the year - but we have no plans to copy it elsewhere,' said Newendorp.

Successful as it has been, TDJ is not limiting itself to regional financial advisory work. It is preparing to bring some capital to the region. 'At the request of sponsors who want our skill sets applied to capital, we are preparing to launch a fund that will focus on equity and mezzanine opportunities in the energy sector,' he said. 'We've already raised $100 million and are aiming for about $250 million in the short term. The Middle East is a major target area for investments.' The aim is for the TDJ Global Oil & Gas Energy Fund to generate an internal rate of return of 15-20 per cent through investments in dollar-based, medium-risk projects, many of which will be self-liquidating. Petroleum Finance Corporationand Nexant Chem Systemsare partnering TDJ on the fund.

However, TDJ's main focus in the Middle East is likely to stay in the financial advisory sector. If a significant number of project sponsors follow Alba's lead and choose to opt for fully independent financial advisers, the likelihood is that TDJ will be the major benefactor and the international banks will start changing their attitudes and strategies.