Verde Agritech obtains a permit to build railways in the state of Minas

The railway line includes a route between the company’s facilities, in São Gottardo and Matutina, in Alto Paranaiba, to Ipia, in Triangulo Mineiro.

Verde Agritech has factories in the cities of São Gottardo and Matutina in Alto Paranaiba Credit: Verdi Agric / Disclosure

Verde Agritech has obtained a license from the National Agency for Land Transport (ANTT) and the Ministry of Infrastructure (MINfra) to build a railway branch in the interior of Minas Gerais. The railway will allow the agricultural technology company, which produces potassium fertilizer, to transport up to 50 million tons of the product annually.

The project includes a route between the manufacturer’s facilities, located in the cities of São Gottardo and Matutina, both in the Alto Paranaiba region, to the municipality of Ibia, in Triangulo Mineiro. According to the company, the section will be connected to the railway network covering seven states and the Federal District, with part of the management carried out by Ferrovia Centro Atlântica (FCA).

With the approval of the competent authorities It was published this Tuesday (12) in the Official Gazette of the FederationVerde Agritech is now waiting to sign a contract with ANTT to use the railway on an exclusive basis. After that, environmental and engineering studies for the project will begin.

It should be noted that railway lines are expected to be established by companies in a temporary measure from August 2021, which established the Railway Licensing Program (Pro Trilhos). In addition to the possibility of construction, the initiative allows companies to operate railways, branches, yards and railway stations. The aim is to increase the attractiveness of the private sector to invest in the tracks, whether built from scratch or already existing.

The railway project investment will amount to more than 550 million US dollars

As previously reported by DIÁRIO DO COMÉRCIO, investment in the project will exceed US$550 million. In a statement last year, Verde Agritech said the FCA should bear the costs of building the railway branch. The company that produces potash fertilizers also reported at the time that it was studying the possibility of concluding potential partnerships for technical support in the implementation and logistical operation of the railway.

Breaking down the costs, the manufacturer, which was founded in 2005 and has been listed on the Toronto Stock Exchange since 2007, explained that the construction of the railway line alone cost a capital expenditure estimated at US$283.02 million. The total amount, estimated at approximately US$553.99 million, includes remediation expenses, road improvement, licenses, studies and technical projects, purchase of land and equipment, mobilization and demobilization of employees, and 15% of the emergency value.

Possibility of carbon dioxide capture and negotiations on carbon sales

Currently, Verde Agritech has two plants operating in the state, capable of producing up to three million tons of potassium annually. In 2022, the company announced investments worth R$275 million to build a third plant, increasing production potential to 13 million tons per year. The company claims to have the largest potash production capacity in Brazil and is the first in the world to add microorganisms to fertilisers.

According to the founder and CEO of the company Green agricultural technologyCristiano Veloso The company’s mines have the largest potash reserve in the country, with a resource of 3.32 billion tons. “This represents another important milestone in our goals: to reduce Brazil’s dependence on imported potassium and expand our capacity to capture up to six million tons of carbon dioxide per year, contributing to climate change mitigation,” he stressed.

This high ability to sequester carbon dioxide from the atmosphere, which Veloso cited, was proven by a study conducted by a university in the United Kingdom, which confirmed that every ton of K Forte potassium fertilizer, produced by the company, is able to sequester up to 120 carbon dioxide. kilogram of carbon dioxide.

Additionally, the company is in advanced negotiations to sell carbon credits to global companies seeking a permanent carbon offset. Credits similar to Verde Agritech are currently trading for up to US$500 per tonne.