Brazilian group Vale announces funding agreement for logistics corridor in Mozambique

28 November 2017

The companies included in the Nacala Logistics Corridor (CLN) on Monday signed project finance contracts under which the public-private partnership in Mozambique will receive US$2.73 billion, said Brazilian group Vale in a market filing.

The statement also said that the Japan Bank for International Cooperation will provide US$1.03 billion and the Sumitomo Mitsui Banking Corporation, the Bank of Tokyo Mitsubishi UFJ Ltd, Mizuho Bank Limited, Sumitomo Mitsui Trust Bank Limited, Nippon Life Insurance Company and Standard Chartered Bank will provide a loan of US$1 billion with insurance offered by Nippon Export and Investment Insurance (NEXI).

Of the total loan US$400 million willbe provided by Absa Bank Limited, Investec Bank Limited, Rand Merchant Bank and the Standard Bank of South Africa Limited, and credit insurance will be offered by Export Credit Insurance of South Africa Limited (ECIC) and the remaining US$300 million will be provided by the African Development Bank.

This loan agreement completes the investment structure to support the launch of the logistics corridor up until it reaches full capacity, said the Brazilian mining group.

This loan will be paid off over 14 years using revenues from services to transport coal and general cargo provided by CLN, whose tariff was introduced in April 2017 after the completion of the transaction with Mitsui & Co. (macauhub)