Angolan Government awards Lobito Corridor railway concession tender

(Posted on 25/07/22)

The Ministry of Transport of the Government of Angola has announced the award of the concession tender for rail services and logistics support for the Lobito Corridor, a key route connecting mines in the Democratic Republic of the Congo (DRC) to the Lobito port in Angola and international markets beyond. The 30-year concession, with the potential of a 20-year extension, has been awarded to a consortium comprising Trafigura Pte Ltd, a market leader in the global commodities industry, Mota-Engil Engenharia e Construcao Africa SA, an international construction and infrastructure management company and Vecturis SA, an independent rail operator.

The consortium is grateful for the efficient and transparent public tender process that the Commission of Evaluation has run that recognised the significant strengths and experience that the consortium brings to the concession. With increased dynamics in the transportation of minerals and other materials in the coming years and improved competitiveness of the rail system, it is expected that the Lobito Corridor could become the 3rd most important corridor in the SADC region by 2050.

The consortium will be responsible for the operation, management and maintenance of the rail infrastructure for cargo transport, minerals, liquids and gas for the Corridor that links the port of Lobito with Luau in eastern Angola close to the border with the DRC. As part of the concession agreement the consortium has committed to invest significant capital in improving the rail infrastructure to improve the capacity and safety of the Lobito Corridor, as well as to invest in significant rolling stock for freight operations.

Currently copper, cobalt and other metals are exported from the DRC east via Dar es Salaam in Tanzania, via Beira in Mozambique, or south via Durban in South Africa, a journey that takes several weeks or more. As export volumes have increased from the DRC due to the demand for minerals needed for the energy transition, the roads have become more congested and delays at the border more protracted. This new export corridor utilises existing national rail infrastructure, removes trucks from the roads and offers considerable cost and time savings for miners in the Copperbelt to export to international markets.

The consortium is owned 49.5 percent each by Trafigura and Mota-Engil, with the remaining one percent owned by Vecturis. The concession agreement is expected to be signed in the weeks ahead.