LOBITO Atlantic Railway (LAR) has secured $US 753m in financing from the US International Development Financial Corporation (DFC) and the Development Bank of Southern Africa (DBSA), following the signing of loan agreement in Washington, DC, on December 17.
LAR holds a 30-year concession to upgrade and operate the 1289km Benguela Railway from the port of Lobito in Angola to Luau on the border with the Democratic Republic of Congo (DRC). It is owned by the Lobito Atlantic Holdings (LAH) consortium comprising Trafigura, Mota-Engil, and Vecturis.
Alongside $US 553m from DFC, DBSA is providing approved senior debt funding of up to $US 200m. The loan will be used to upgrade track, workshops, signalling systems, and rolling stock, enhancing the capacity, efficiency and reliability of the shortest route between the copper mining region of the DRC and export markets. According to DFC, the upgrade will increase freight capacity 10-fold to 4.6 million tonnes and cut the cost of moving minerals by up to 30%.
“This financing from the DFC and DBSA marks a major milestone in our vision to establish the Lobito Corridor as Africa’s premier trade route,” says LAR CEO, Nicholas Fournier.
“This financing stands out for its unprecedented scale and strategic significance,” says Dr Ricardo Viegas D’Abreu, Angola’s minister of transport.
“It sets an important benchmark for other sectors to access capital from American institutions.”
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