Amapá railroad to began to operate in 2007

MMX, an iron ore mining company recently created by Eike Batista will invest US$ 120 million in logistics for its Amapá operations, comprising a rail line, the Estrada de Ferro do Amapá (EFA) railroad and two ports. During 2007, this system will receive US$ 59 million and should begin operations, according to of Rodolfo Landim, director of Investor Relations.

Specifically, the 200-km rail line will receive a total of R$ 40.7 million over the next two years. MMX won a 20-year concession for the railroad line, for which it paid R$ 814,000.

In order to get the line ready for bringing out MMX’s ore production, the stations between Santana and Serra do Navio will be reformed, while railroad cars will be refurbished and the signal system modernized. The track bed also will be improved, including substitution of the rails.  A visionary businessman, Batista created MMX with its logistical system already fully planned. There will be three production systems, with one in Corumbá (MS), one in Amapá and the third in Minas-Rio, totaling 37 million tons/year when in full operation. In the three systems, the main product will be iron ore; however, the company also will produce pig iron and semi-finished products.

Each one of the systems will use a different solution. Corumbá uses river barges, unloading at Rosário, Argentina, while at Amapá, production is to be transported by rail until the ports. For the main system, the Minas-Rio operation, the product will be transported via a totally underground ore pipeline for 525 km, going through Minas and winding up at the Port of Água Profunda, in Rio.

MMX’s average cost of production will be US$ 10/ton, with the rail transportation responsible for US$ 1.60 per ton, while the transportation cost via the ore pipeline will be US$ 0.80.

EFA

The Estrada de Ferro do Amapá, inaugurated in 1957, was built by Icomi in partnership with Bethlehem Steel of the United States for bringing out manganese from mines located in the Amapari and Araguari region of the Serra do Navio mountain range until the Port of Santana. After the manganese ore ran out, the line was used for hauling chromite and for passenger traffic.

Fonte: Folha de São Paulo