Peru Rail

completed

Under the 30-year concession contract, the Peruvian state railway ENAFER transferred fixed assets and rolling stock of the Southern line and Southeastern line to Ferrocarril Transandino S.A. According to the Concession Agreement, the shareholders of the Concessionaire are allowed to own one railway oeprating company. Orient-Express and Peruval formed Peru Rail S.A. and took over operations of the network on September 21,1999. In addition, the shareholders formed Meviasur S.A.C., a company responsible for rolling stock and infrastructure maintenance. The project comprises the Project Company''s investments for upgrading and rehabilitation of the railway network, the rehabilitation of rolling stock, the purchase of equipment and radio system and other investments from 2001 to 2004. In addition, the project includes the refinancing of investments in 2000. The Project Company is expected to improve and maintain the railroad according to Class II American railway standards as specified in the bidding documents and the Concession Contract. Major parts of track and superstructure will be upgraded, locomotives will be maintained and replaced, and the telecommunication system will be replaced.