In a significant move towards enhancing trade infrastructure in Africa, Trafigura and Kamoa-Kakula on Wednesday, February 7 inked long-term commitments to utilize the Lobito Atlantic Railway for transporting minerals.
This strategic collaboration was sealed during the 2024 Mining Indaba in Cape Town, South Africa. The move represents the inaugural commercial agreements for the Lobito Atlantic Railway. The railway is a vital import-export conduit linking the African Copperbelt to Angola’s Atlantic coast.
The Lobito Atlantic Railway is poised to reach an annual export capacity of one million tonnes by the decade’s end. Furthermore, It has garnered considerable attention.
Trafigura and Kamoa-Kakula Collaboration
Trafigura, a global commodities trading firm, secured an allocation of up to 450,000 tonnes per annum starting from 2025. This underscores its commitment to leveraging emerging trade route.
Additionally, the Kamoa-Kakula copper complex, a joint venture between Ivanhoe Mines and Zijin Mining, will contribute significantly. It has a minimum capacity of 120,000 tonnes and the potential to transport up to 240,000 tonnes per annum of copper products by 2025.
The genesis of this collaboration traces back to 2022. During this time, the Lobito Atlantic Railway consortium, comprising Trafigura, Mota-Engil, and Vecturis, clinched a 30-year concession to operate, manage, and maintain the railway and associated port infrastructure.
Currently, the consortium has positioned the Lobito Atlantic Railway as a pivotal artery for transportation. It transports copper, cobalt, and other crucial metals vital to the global energy transition. At the same time, it also emphasizing open commercial access.
Insights from Key Executives
Jeremy Weir, Executive Chairman and CEO of Trafigurab has hailed the long-term commitment as a testament to the consortium’s vision to elevate the Lobito Atlantic Railway into a preeminent rail transport link in sub-Saharan Africa.
He further expressed optimism in welcoming additional customers to join the transformative venture in the near future.
On the other hand, Robert Friedland, Founder and Executive Co-Chairman of Ivanhoe Mines, lauded the collaborative efforts of the Lobito Corridor consortium and Trafigura in establishing a robust supply chain.
Likewise, Friedland emphasized the economic ramifications of this initiative. Notably, he cited lower logistical costs that unlock more economically viable copper projects across the Copperbelt.
Additionally, he highlighted the impact on recent discoveries in the Democratic Republic of the Congo (DRC). The discovery include, high-grade Kitoko copper in the Western Foreland. The mine stands to benefit from enhanced logistical infrastructure.
Lobito Atlantic Corridor Sponsers
At the same time, the Lobito Atlantic Corridor project is backed by the governments of Angola, DRC, Zambia, and the U.S. government’s Partnership for Global Infrastructure Investment (PGII). The project underscores a substantial investment exceeding $500 million over the concession’s lifetime.
There is a potential financing of at least $250 million from the U.S. International Development Finance Corporation for the project. However, the project aims to renovate railway sections. Likewise, it will innovate infrastructure, and procure essential rolling stock. This will further catalyze economic growth and trade facilitation in the region.
Trafigura-Kamoa-Kakula agreements mark a pivotal milestone in leveraging Africa’s vast mineral resources. It also enhances trade connectivity and infrastructure. More so, paving the way for sustained economic development and regional integration.
The Lobito Atlantic Railway project Will redefine regional trade dynamics. Moreover, It will also catalyze inclusive growth across the continent.