Mining firm Bahia Mineracao (Bamin) has signed a concession agreement with the Brazilian state of Bahia to build and operate a $1bn maritime terminal.
Located north of the city of Ilheus in Bahia, the new terminal’s 495 acres of land will be used for processing, storage and transport of iron ore coming from Bamin’s Pedra de Ferro mine, in Caetité.
Under the deal, Bamin will be responsible for the construction of the terminal and surrounding infrastructure, including access roads and jetties.
According to Bamin, all necessary environmental permits are expected to be secured by late 2013 to commence construction of the terminal in early 2014.
Construction of the terminal will be carried out over five years, following which Bamin will receive a 30-year, renewable concession to operate the terminal and ship about 25 million tons of iron ore per annum.
Bamin’s Pedra de Ferro project, scheduled to commence operation in coming months, is expected to produce 19.5 million tons of iron ore per year.
The concession agreement was signed after a recent reform of the country’s ports laws, which was approved by Brazilian president Dilma Rousseff.
The changes introduced by the law include enabling private ports to mange any type of freight, permitting private operators to handle more third party cargo, extending pre-1993 public port terminal contracts by ten years and authorising the launch of tenders for pre-1993 contracts.
Bamin manages four mineral concessions in Bahia with an estimated 1.8 billion tonnes of iron ore resources.
By the end of 2014, a new 540km railroad will also be built near the town of Caetite, which will be connected to the mine site.