Transportation cost is the dominant cost and accounts for almost half of the total mining cost in surface mining. Therefore, determining transportation cost is critically important for the economic feasibility of mining projects. Turkey produces around 85 million tons of lignite per annum. The biggest state-owned company, Turkish Coal Enterprises (TKI), accounts for 43 per cent of the country's total lignite production. Around 85 per cent of the produced lignite is used in power plants for electricity generation and 15 per cent is used for domestic heating in cities and urban areas. On behalf of the Turkish government, TKI distributes around 2 Mt of lignite annually, at no cost to poor needy families countrywide in accordance with Social Assistance and Solidarity Funding aid. Subcontractors are utilized for lignite transportation, and conflicts arise due to the different transportation cost calculations at different mines. A robust model that provides unbiased cost estimations is therefore of paramount importance. This paper presents the transportation cost estimation software, NAKMAL, that has been developed for estimating the transportation cost of lignite from the mine face, including excavation and loading, to various final destination points through five different transportation scenarios. NAKMAL was designed using Visual Studio.NET, validated using field data and some case studies, and it is currently being used by TKI for calculation of transportation cost country-wide.