The President of Brazil, Jair Bolsonaro, the Minister of Infrastructure, Tarcísio Gomes de Freitas, the director of the National Land Transport Agency, Mario Rodrigues Júnior, and Rumo signed the 30-year concession contract for Ferrovia Norte-Sul (North-South Railway). Rumo won the auction submitting a tender valuated at BRL 2.7 billion (USD 677.6 million). The minimum value of the bid was BRL 1.35 billion (USD 339 million), with BRL 2.8 billion (USD 702.75 million) projected investments in the railway.
The 1,537-km southern section offers the connection between Porto Nacional, in Tocantins state and Estrela D’Oeste in São Paulo state. This section is divided into two. The 855 km section between National Port and Annapolis which was fully modernised, is operational, with freight transport services expected to be launched by the end of 2019. The 682-km section between Anápolis and Estrela d’Oeste is 95% completed and, under the contract, Rumo has two years to complete the works and start operations in 2021.
Rumo will provide rail transport services in and will ensure the maintenance and conservation of the infrastructure. It will also execute environmental plans, implement maintenance facilities, filling stations and acquire railway equipment and rolling stock.
“We will create a competitive transport system, and we intend to increase rail market share from 15% to 30% within the next 8 years. The railway is considered the backbone of the Brazilian rail system and one of the main projects for the increase of freight flow,” the minister said.
Ferrovia Norte-Sul demand for freight services is estimated to reach 1.7 million tonnes by 2020, increasing to 22.7 million tonnes by 2055. The general and industrial cargoes are expected to be transported from São Paulo region to consumer centers such in Goiânia, Brasília, Palmas and Imperatriz. In the opposite direction, significant volume of grains from Tocantins, Goiás and Mato Grosso will be moved for export through the port of Santos.
The Ferrovia Norte-Sul is designed to become the backbone of Brazil’s rail network, integrating the national territory and contributing to reduce the logistical cost of freight transport in the country.