Zambia’s Northwest Rail said on Friday it has secured $500 million for the first phase of a railway linking Zambia’s copper belt to the Angolan border, in a project that aims to extend the line to Angola’s coast.

South Africa’s Grindrod and other shareholders will put up the equity, and several banks would provide the larger debt portion, Northwest Rail’s chairman Enoch Kavindele said.

Grindrod was contracted to build, operate and maintain the 590-km (370-mile) railway in February 2014 by Northwest Rail, which won exclusive rights from the state to develop the line for use in exporting copper from Zambia.

“It will be a mix of 70 percent debt and 30 percent equity and both the debt and equity for the first phase are now in place,” Kavindele told Reuters on the sidelines of a mining and energy conference.

“We are talking to the government and should start building the line this year after we agree on the concession tenure.”

The first phase of the rail link would connect Zambia’s old Chingola copper fields to the newer mines at Kansanshi, Lumwana and Kalumbila, Kavindele said.

The second phase of the project, also estimated to cost $500 million, will open a direct corridor to the Angolan port of Lobito allowing landlocked Zambia to export copper and import oil from Africa’s second-largest oil producer.

Source: Reuters Africa