UPDATE 1-Chad signs $7.5 bln rail deal with China's CCECC

Mon Mar 14, 2011 1:43pm EDT

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N'DJAMENA, March 14 (Reuters) - Chad has agreed a $7.5 billion contract with China Civil Engineering Construction Corporation (CCECC) to build 1,344 kilometres of railway in the oil-producing central African state.

"We shall soon be discussing the mode of payment. All options remain open -- crude oil, minerals or cash," infrastucture minister Adoum Younousmi said at a signing ceremony on Monday.

CCECC president Yuan Li said the first phase would consist of two short stretches linking the eastern town of Abeche to the Sudanese border, and the southern town of Moundou to Cameroon.

A second phase would link those two towns via the capital, N'djamena.

"We are confident in our capacities," said Yuan. The first phase was due to start in 2012 and take four years to complete.

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