MRS to renew railroad concession contract with Brazilian gov’t until 2056

MRS Logística unanimously approved amending the railroad concession contract with the Brazilian federal government to extend the concession period by another 30 years until 2056, after the Federal Court of Accounts (TCU) gave the green light to the early renewal of the contract.

According to MRS, after the TCU’s approval, the National Land Transportation Agency (ANTT) promptly adjusted the documentation. The process is in the final stage before the signature of the amendment contract, which will take place in July.

In return for the early railroad concession renewal, the final value of the updated grant will be R$4.6 billion at the present value in three blocks, with payment of the grant amounting to R$524 million in 128 quarterly installments at the worth of BRL 14 million;  investments of BRL 4.8 billion in urban conflict mitigation work over the next 12 years; establishment of a reference fee for crossing the Baixada Santista region.

In addition, the contractual amendment establishes new regulatory obligations that will require MRS to adjust internal processes, which the company has already begun, says the statement. The new commitments include a mandatory investment plan, minimum technical specifications, an increase in the grant, operational governance, and collection and verification of information, among others.

With the early renewal of the concession contract, the funds will be invested in 280 railway works spread across 51 municipalities in the states of Minas Gerais, São Paulo, and Rio de Janeiro. Among the projects is the segregation of 90 km of tracks shared with CPTM passenger trains in the Greater São Paulo region.

Source: Valor Econômico

To read the full original article, please go to: https://valor.globo.com/empresas/noticia/2022/07/05/conselho-da-mrs-aprova-prorrogao-de-concesso-ferroviria-com-governo-federal-at-2056.ghtml

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