European backed railway will connect unexploited Northern coal reserves to the port of Nacala by 2015
The government of Mozambique has secured $500m (£313m) to construct a new railway line.
The new line will link the coal-rich mines in Moaztize, in the northern part of the country to Nacala port by 2015.
The transport minister said the Dutch and Danish government had both provided funding, as well as the European Union meaning construction could begin in two months.
The Brazilian firm which mines in the Moatize said the area represented one of the world’s last great unexploited coal reserves, the BBC said.
Mozambique’s infrastructure links are still recovering from the civil war which ravaged the country in the early 1990s.
A 420 mile long railway linking Beira port to Moatize was cleared of mines and unexploded ordnance three years ago. But the silted port of Beira is no longer able to handle big vessels, the BBC reported.
Transport minister Paulo Zucula said the new line would link the existing line with a railway running between another deep water port, Nacala, and Malawi.