Vale Renegotiates Railway-Concession Contracts in Brazil

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Written by Amir Richani for Industrial Info Resources (Sugar Land, Texas)--Mining giant Vale S.A. (NYSE:VALE) (Rio de Janeiro, Brazil) has renegotiated its concessions with the Brazilian government for the Carajas Railway and the Vitoria a Minas Railway, allowing it to extend operations until 2057. The concession includes investments worth 11 billion reals (about US$1.7 billion) for the asset base review, the optimization of contractual obligations, and investment replanning.

The contracts between Vale and the government were first signed in December 2020, allowing extension for operations through 2057. Among the company's commitments for the concession extension was to grow the passenger train services in both railways and work to reduce urban conflict.

This contract extension allows Vale, Brazil's largest iron ore miner, to continue to integrate its logistic chain across operations.

The Carajas railway extends for 892 kilometres (554 miles) from the city of Parauapebas in Para state to Sao Luis in Maranhao state. This railway transports passengers and minerals from the Serra Dos Carajas Mine to Vale's Ponta da Madeira maritime terminal complex in Maranhao for export. The network mainly transports iron ore, with some 190 million tons of iron ore and other cargo transported in 2022.

Meanwhile, the Vitoria a Minas Railway has an extension of 905 kilometres (562 miles) from the company's Southeastern System mines in the Minas Gerais state to the Tubarao Port in Vitoria, Espiritu Santo state.

The railway transported 77 million metric tons of iron ore and 19 million metric tons of other cargo in 2022, as well as 579,000 passengers.

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