Maputo, Mozambique — 12 February 2013 – Vale Mozambique “’ a subsidiary of Brazilian mining giant Vale SA “’ has signed a cooperation agreement with Mozambican state rail and port company Portos e Caminhos de Ferro de Moçambique (CFM) to build what is termed the “Nacala logistics corridor.”

Mozambican newspaper O País quotes CFM director for logistics, Ricardo Saad as saying this would be Vale’s biggest logistics project in Africa, and that it was expected to solve the problem of transporting natural resources, particularly coal, to the coast for export.

Although the project was complex, the company planned to finish construction of the railroad by the second half of 2014, reports Macauhub News Agency.

The Vale representative said that the company’s aim was to make the coal business in Mozambique viable, and that trains should start running on a limited basis by the second half of next year.

The Tete-Nacala railway line, in which the Vale group plans to invest US$4.5 billion, will have an initial capacity of 30Mtpa, which is more than the company’s current production levels.

Since the beginning of its operation about a year ago the company has exported almost 1.5Mt of coal and this amount will increase. Vale Mozambique currently has capacity to produce   5Mtpa, and within eight years output is expected to rise to 22Mtpa.

Source: Macauhub News Agency. For more information, click here.