Paraná state prepares tender notice for Nova Ferroeste rail concession

Brazil’s Paraná state is moving forward with its concession plan for the 1,567km Nova Ferroeste railway, the state’s infrastructure and logistics secretary Sandro Alex told BNamericas.

“We’re preparing a series of documents requested by [federal environmental agency] Ibama as part of our efforts to obtain the project’s environmental licenses. With those licenses secured, I believe that within six to 12 months we will have the notice published," said Alex. 

The concession is expected to have a major impact on the Paranaguá port.

"Currently, 20% of the cargo transported through the port arrives by rail. With Nova Ferroeste this will increase to 50%," said Alex, who could not disclose the project’s estimated capex and opex figures.

The Paraná state government currently operates Ferroeste, a 248km railway that runs between the cities of Cascavel and Guarapuava.

The Nova Ferroeste project entails 1,567km of new tracks, crossing 66 municipalities, 51 in Paraná and eight in Mato Grosso do Sul state. The concession contract will have a duration of 99 years. 

"Although Nova Ferroeste is a concession from the state government, the federal government approved its inclusion in the PAC [program] and this makes it a national priority that will help speeding up the process," said Alex. 

Earlier this month the federal authorities unveiled PAC, outlining investments worth 1.7tn reais (US$349bn) with 1.4tn due to be invested by the end of 2026 when President Luiz Inácio Lula da Silva ends his term.

The investments will be funded by state-owned companies, as well as concessions and PPPs. Under PAC, the federal government will invest 94bn reais in the rail sector via 35 projects. 

The government is also working on regulatory changes to help spur investments.  

"In the first months of President Lula's administration our focus was on highways as there were more advanced projects, but by the end of September I will announce details of the new rail sector framework to improve regulations for contracts and projects," transport minister Renan Filho told BNamericas.