CCECC President Yuan Li told reporters in N'Djamena during the signing of the construction deal that the project will be undertaken in two phases.

To be completed in four years, the first phase is slated for commissioning next year. This phase of the railroad will have two lines: one linking the town of Abeche to Adre on the Sudanese border, the other linking the town of Moundou to Koutere near the Cameroon border.

Phase two of the railway project will link these two lines through the country's capital, N'Djamena.

China has offered to finance the project with a loan signed by the Chad government through the Export/Import Bank of China. However, no agreement has been reached as to how the loan will be repaid.

“We shall soon be discussing the mode of payment. All options remain open, including crude oil, minerals or cash,” said Adoum Younousmi, Chad's infrastructure minister.

Chad's infrastructure ministry and CCECC, the minister said, are working out the project's details, including procurement of a design-services contract. Among other issues, the contractor will determine how many tracks the standard-gauge railway line should have. Negotiations are ongoing between Chad and CCECC on the supplier of the rails.

As Chad seeks cheaper means of gaining access to international markets, this new deal is the second attempt to link the country to its neighbors by rail.

In 2001, Libya announced plans to construct a 3,170-km-long line to connect its rail system to those countries to the south, including Chad, Nigeria, Sudan and Niger. The plan did not go forward because, among the countries that would have hosted the line, there was a lack of funding and coordination, Libyan officials later said.

Meanwhile, another plan for a regional railway awaits implementation. Under the New Partnership for Africa's Development (NEPAD), an African Union program launched in 2001 to boost the continent's growth, the plan was approved in 2006. The NEPAD railway line will link Chad to Libya and Niger.