Brazil prepares to reoffer US$3.6bn Malha Oeste rail concession

Brazil’s government is planning to hold an auction in 1H24 to reoffer the concession for the Malha Oeste freight rail line.

The timetable was unveiled at a public hearing in Campo Grande, capital of Mato Grosso do Sul state, where comments were received on the technical, economic and environmental studies for the 1,625km line.

Malha Oeste is currently operated by Brazilian logistics firm Rumo, which told the government in 2020 of its intention to return the concession. Returning a concession tends to take years since the government needs to evaluate the costs involved, the possibility of reoffering the contract, and if any compensation will be paid.

The 60-year contract to be offered is for a stretch crossing Mato Grosso do Sul and São Paulo state, and will demand an investment of 18bn reais (US$3.56bn).

“There are interested investors. We have received expressions of interest from several international firms,” said Jaime Verruck, Mato Grosso do Sul’s secretary for the environment and development, in a statement. “We have a railroad that can operate immediately and generate cash flow.”

Source: Bn Americas

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