Brazil’s Federal Audit Court (TCU) has recommended canceling Vale’s proposed early renewal of an existing iron ore railway concession to transport minerals and steel citing serious methodological irregularities.
The Brazilian iron ore miner did not include risks related to iron ore demand in its study, TCU noted, which led to its recommendation to cancel the Estrada de Ferro Vitória a Minas (EFVM) iron ore railway concession. The recommendation was also sent to the Brazilian Ministry of Infrastructure and the transportation agency (Antt).
Vale’s EFVM railway line is 905 km long and transports approximately 115mn mt of iron ore per year, according to the steelmaker. The railroad begins in Minas Gerais where the iron ore is extracted and continues to the Tubarão Complex in Espírito Santo, where it is used to make steel.
The railroad also transports coal, grains, fertilizers, and steel products, the Brazilian steelmaker said adding that about 40pc of general freight in the South American country goes through EFVM.