Nigeria’s government began a $3 billion rehabilitation of a railway line that links major cities in Africa’s most-populous country.

The project marks the latest step in an ambitious plan to create a nationwide rail network intended to aid Nigeria’s economic diversification away from crude oil. The development is designed to revamp a dilapidated 1,700-kilometer (1,056-mile) line that begins in the southeastern oil hub of Port Harcourt and terminates in the northeastern city of Maiduguri.

Nigeria has already completed rail segments that connect Abuja, the capital, to the city of Kaduna and Lagos, the main commercial center, with the city of Ibadan. That work was financed by about $2 billion of loans from the Export-Import Bank of China. Mota-Engil SGPS SA, a Portuguese construction company, last month started work on a $1.8 billion line that will link the northern trading hub of Kano to the town of Maradi in neighboring Niger.