Norte Sul Railroad

Active

Prospective

In December 2007, Companhia Vale do Rio Doce SA (CVRD) signed a 30 year concession contract to operate, maintain and modernize a 720 km stretch of the Norte Sul railroad with VALEC, a state-owned company run by the federal Ministry of Transportation. The stretch was to connect Acailandia, in Brazil's northeastern Maranhao state, with Palmas, in the northeastern Tocantins state. The Norte Sul railway was to connect with CVRD's existing railway, which ran from the company's iron ore mine Carajas and enabled access to the Itaqui port in Sao Luis, where CVRD has the Ponta da Madeira maritime terminal. See Carajas Railway, project 2084. The contract was awarded at a public auction held on October 3, 2007 at Sao Paulo's Bovespa Stock Exchange. Companhia Vale do Rio Doce SA (CVRD) was the only bidder and offered the minimum bid of 1.48 billion Brazilian reals (US $760 million) for the concession rights. The first installment was paid with the contract signing in December 2007. The majority of the payment was to be used by VALEC to construct the unfinished portions of the railway. A stretch of 133.5 kilometers between Estreito and Araguaina, in the state of Tocantins was already was constructed by the VALEC, and was to be operated immediately by CVRD. Another 213.2 kilometers of railway, connecting the cities of Araguaina and Guarai, both in the state of Tocantins, was expected to be completed by December of 2008. VALEC had until December of 2009 to finish the final stretch of 148.3 kilometers between Guarai and Palmas. CVRD was to operate these assets as they became available. CVRD also committed approximately US $33.9 million to modernize the railroad facilities.

Transport

World Bank Group

Project

Mass Transit, Steel, Metal, Seaport, Rail, Government, Commercial