When laws of Austria-Hungary allowed constructing local narrow gauge railways, the first economical analyses of a west Istrian railway were prepared around 1880. In 1888 a Berlin based company "Sanderop & comp", led by Peter Walderstein started to prepare project plan of the route. A Trieste based company of Luigi Buzzi did the same independently of "Sanderop & comp". In 1898 a construction permit was obtained and in 1900 the TPC company was founded in Vienna, its chief was Ludovico Rizzi, then a governor of Austrian Littoral. The construction started the same year. Several contractors were assigned the construction works. The section between Trieste and Portorož was constructed by "Butoraz" and "Zifer", both from Trieste, the section between Portorož and Buje was built by Filip Zupančič's company from Ljubljana, the section between Buje and Vižinada was assigned to "Brunetti", "List" and "Radl", all from Graz, and the section between Vižinada and Poreč was constructed by "Pellegrini" and "Strohmeier", both from Vienna as well. On 1 April 1902 the first section between Trieste and Buje was opened. The other section between Buje and Poreč was opened on 15 December 1902. Initial plans included an extension to Kanfanar, then a rail junction of standard gauge rail lines from Divača, Pula and Rovinj (the section between Kanfanar and Rovinj is now defunct) but it was never built due to lack of funds and later due to upcoming World War I.