INFRASTRUCTURE Portugal (IP) has awarded a €120m contract to modernise the 69.6km Vendas Novas railway, marking the start of the first phase of a wider €204m upgrade programme to the freight line.

The project is intended to increase line capacity, improve operational reliability and reduce costs for operators. IP says the upgrade will boost freight volumes on the line by 50% and reduce CO2 emissions by 500,000 tonnes by 2050. Portuguese media have reported that the contract has been awarded to a consortium led by Domingos Silva Teixeira (DST) and Dstrainrail.

The line runs from Setil to Vendas Novas and is the main route for freight traffic to and from the Port of Sines. It enables trains to bypass the Lisbon metropolitan area where capacity constraints limit heavy rail movements.

Work will include upgrades at 11 freight yards - five of which will be extended to accommodate 750m-long trains - replacement of culverts, slope stabilisation, and safety improvements through the closure and automation of level crossings. The scheme also includes the modernisation of signalling and telecommunications systems, with the aim of removing technical bottlenecks and ensuring interoperability with the European rail network.

The project is scheduled for completion within 48 months and is financed under Portugal 2030 through the Climate Action and Sustainability Programme, and is supported with €108m in European Union (EU) funding.