Mota-Engil consortium wins Lobito corridor concession in Angola

The Mota-Engil/Trafigua/Vecturis consortium has won the Lobito corridor concession in Angola, for US$100 million and will manage the operation and maintenance of rail freight transport between Lobito and Luau for 30 years.

According to a statement from Angola’s transport ministry, the amount of the signature premium- around €97.5 million – is in line with the amount of other concessions in the Angolan transport sector, and has made it possible to differentiate between competitors based on their financial capacity in relation to the size of the assets in question.

With the rents negotiated, the Angolan state will collect over US$2 billion (€1.951 billion): US$319 million (€311 million) in the first 10 years, US$797 million (€777 million) between the 11th and 20th years, and US$919 million (€897 million) in the last 10 years.

The concession holder will invest US$256 million (€250 million) in infrastructure, US$73 million (€71.25 million) in equipment and rolling stock and an additional US$4.3 million (€4.2 million) in other atdreas.

In terms of cargo to be transported, the forecasts are for 1,678 tonnes in the fifth year of the concession, 2,982 tonnes in the 10th year, 4,979 tonnes in the 20th year, and 4,979 tonnes in the 30th and final year.

The concession is for 30 years, and can be extended to 50 years if the concession holder opts to build the Luacano (Moxico) – Jimbe (Zambia) rail link.

In the statement, the Angolan ministry noted the benefits of this award for the country, including “the impact on the development of industries that are heavily dependent on the logistics chain, such as agriculture and mining, and the resulting creation of jobs in each of them.

He also noted that it would create “opportunities for the development of small businesses adjacent to rail transport and a competitive rail alternative to road transport, capable of contributing to the reduction of freight rates.

According to the minister for transport, Ricardo Viegas d’Abreu, cited in the press release, the operation of the Lobito Corridor will contribute to local and regional development around the railway and may represent a contribution to the Gross Domestic Product estimated at between US$1.6 billion and US$3.4 billion (€1.56 billion to €3.32 billion).

The consortium includes the Portuguese group Mota-Engil, which has been in Angola for over 70 years and is currently one of the world’s leading providers of infrastructure construction services; Swiss multinational Trafigura, one of the world’s leading commodities traders and Vecturis, a Belgian railway operator, with strong rail transport activity (passengers, minerals and commercial cargo) in African countries such as the Democratic Republic of Congo, Tanzania, Cameroon, Madagascar, Ivory Coast, Burkina Faso and Algeria, and also in Brazil, Russia and Pakistan.

The Lobito Corridor starts at the port of Lobito and crosses Angolan territory towards the east, with a railway line of around 1,300 kilometres, which crosses the mining regions of the Democratic Republic of Congo, in Katanga province and the so-called copper belt in Zambia.