The deal signed by Malawian transport minister Mr Sidik Mia and Mr Paulo Horta, operations director of Vale Mozambique, authorises construction of a 137km line from Chikwana on the Sena Railway to a junction near Makhanga. As part of the project, Vale will upgrade the existing section of the route through Malawi from Makhanga to Nkaya and the border near Nayuci.
Vale currently exports Tete coal via the 574km Sena Line from Moatize to the port of Beira. This line was recently rehabilitated, but even with further investment, it is unlikely to support volumes exceeding 12 million tonnes per year, far short of the anticipated output of Tete's mines. Beira harbour requires dredging to accommodate larger ships, while Nacala is already a deep-water port.