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To: BNSF Coal Customers

Network Update for Friday, March 17, 2017

Operational Performance
The operation is addressing significant service disruptions on the Northern Corridor resulting from multiple landslides and washouts that have occurred in Washington, Idaho and Montana this week. Two landslide events happened yesterday near Katka, Idaho on our Kootenai River Subdivision, which runs between Spokane and Whitefish, Montana. As BNSF crews were clearing the site following the initial event in the morning, an even larger landslide occurred and blocked both the main line and siding again. This short video below highlights the magnitude of what we confronted at the incident scene.

Our crews worked throughout the night to clear and repair our main line, and service was restored at 10:40am Central Time this morning. Customers may continue to experience delays on shipments designated to move through this busy corridor until operations have normalized.

In response to the landslides, some trains were re-routed to minimize the disruption, however, a washout occurred on the Montana Rail Link (MRL) line near Sandpoint, Idaho early this morning which caused the derailment of an empty BNSF coal train. We are assessing the situation at the derailment location and there is currently no estimate on when service will be restored at this time. Impacted customers will receive further updates as additional information becomes available.

As we have reported, the record rain and snowfall this winter in the Pacific Northwest have inhibited network productivity. Flood warnings remain in effect for eastern Washington, northern Idaho and into portions of western Montana. The Seattle area has received nearly three inches of rain already this week, which brings its month-to-date total to nearly 120 percent above normal. Multiple landslides also occurred on our Seattle Subdivision just north of Vancouver, Washington earlier this week. The slides resulted in track outages for several hours on both Tuesday and Wednesday while crews cleared the area to restore service. The risk for additional landslides remains high in several locations throughout the region as more rain is expected today and tomorrow.

Despite these ongoing service challenges from extreme weather, our operations teams are making progress in relieving congestion and improving operational performance. Overall car, train and locomotive velocity, total trains held as well as terminal dwell averages were all better versus the previous week while still underperforming versus the levels reported from the previous March. Our efforts in the Pacific Northwest remain concentrated around three key areas: subdivision productivity, train productivity and crew productivity. We continue to deploy additional personnel and resources as well as focus on lengthening trains to ease congestion. As we move into the first week of spring, we are confident that velocity will trend higher and greater fluidity will return to this area.

Service Expectations for the Week Ahead
More wet weather is expected in the Pacific Northwest during the upcoming week, while a pattern shift will also bring heavy rain and mountain snow into central and northern California. We are also closely monitoring avalanche conditions in parts of Montana where a high risk remains in several areas around Glacier National Park. In the South Region, high winds are likely across portions of the Southern Transcon early next week. Other areas of the network should experience generally favorable operating conditions with no significant service interruptions due to weather expected.

Below is a look at the key operational performance categories for the week ending March 16:

Total trains held for the week decreased by nearly 23 percent with an average 82.6 trains held versus 106.7 trains held during the prior week.

    Versus the March 2016 average: up by 147.2%
Total trains on the system was down by two percent versus the prior week with an average of 1,466 trains on the system.

Locomotive velocity, measured in miles per day (MPD), was 278.0, which is up by nearly two percent from the 273.7 MPD recorded the prior week.
    Versus the March 2016 average: down by 5.3%
Car velocity increased by more than two percent at 208.9 MPD versus 204.5 MPD recorded the prior week.
    Versus the March 2016 average: down by 7.0%
Train velocity, measured in miles per hour (MPH), was up by more than four percent versus the prior week at 17.9 MPH.
    Versus the March 2016 average: down by 18.5%
Total volume was down by more than two percent from the prior week with 190,213 units moved in Week 10 (ending March 11) versus 194,363 units in Week 9 (ending March 4).

Terminal dwell was down by nearly one percent from the prior week at 27.9 hours.
    Versus the March 2016 average: up by 14.3%
As always, we thank you for your business and appreciate the opportunity to serve as your transportation service provider. We welcome your feedback and questions.

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