Coal Network Update for Friday, February 1, 2019

Feb 1, 2019

Operational Performance
BNSF operating teams are engaged in service recovery efforts resulting from the outbreak of extreme Arctic cold in the northern Plains and Midwest this week. As we have reported, record-breaking temperatures of nearly 30 below zero and wind chills exceeding 50 below zero in many locations caused major disruptions to train and facility operations, specifically in our Twin Cities and Chicago Divisions.

Operational performance has been significantly impacted by these harsh conditions, with a substantial increase in total trains held and declines in overall velocity. Multiple trains were halted on various subdivisions due to air flow issues from the extreme cold affecting braking systems as well as broken rails in several locations.

BNSF has responded aggressively to mitigate this disruption. Additional personnel and resources have been deployed to make necessary track repairs, address disabled trains and keep our facilities open throughout this event. With weather conditions improving almost hourly, we are making considering progress in resolving service issues and moving an increasing number of trains. This short video highlights our response to the challenging environment in Chicago and how we are positioned for improvement into the weekend.

Carryback Policy Reminder
With the frigid conditions experienced in many locations this winter, there have been significant issues involving "carryback", which refers to residual coal that remains in the car after it has been unloaded at destination. Frozen carryback, which is usually on one side of the car, may impact the bearings that are part of the car's truck bolster from working as intended and may increase the likelihood of a derailment due to improper weight distribution.

As a reminder, under Item 230 of BNSF 6041 Coal Rules and Regulations, shippers are responsible for the complete unloading of coal cars and securing of coal car doors prior to the departure of an empty unit train from its destination. If BNSF discovers carryback in any coal car in the unit train after it has departed destination, BNSF may remove the car from the train and will impose applicable charges, as specified, associated with its removal.

We appreciate your attention to this issue. Please contact the BNSF Coal Team with any questions.

Service Expectations for the Week Ahead
Temperatures will continue to rise across the Midwest this weekend, with highs in the Chicago area expected to reach into the 50s on Monday. With the mild weather, we expect to generate even greater progress in clearing backlogs as well as normalizing traffic flows into/out of local facilities.

Another significant winter storm will move into Montana and North Dakota this weekend. Winter storm watches and warnings are currently in effect as nearly a foot of snow is possible in many locations along our Northern Transcon route through these states. Below zero temperatures will also follow this latest storm. As always, BNSF teams are monitoring conditions and are ready to quickly respond to any service disruptions.

Other areas of the BNSF network will experience favorable operating conditions, with temperatures well above normal across the southern Plains and Texas to start the first week of February.

Below is a look at the key operational performance categories for the week ending January 31:

Total trains held for the week increased by nearly 52 percent with an average of 143.6 trains held versus 94.6 trains held during the prior week.

    Versus the January 2018 average: up by 57.6%

Total trains on the system was down by three percent versus the prior week with an average of 1,465 trains on the system.
    Versus the January 2018 average: up by 3.5%

Car velocity, measured in miles per day (MPD), was down by more than nine percent at 185.7 MPD versus 204.8 MPD recorded the prior week.
    Versus the January 2018 average: down by 17.3%

Train velocity, measured in miles per hour (MPH), was down by nearly six percent versus the prior week at 16.5 MPH.
    Versus the January 2018 average: down by 14.8%

Total volume was down by nearly one percent from the prior week with 199,682 units moved in Week 4 (ending January 26) versus 201,295 units in Week 3 (ending January 19).

Terminal dwell increased by nearly seven percent versus the prior week at 28.2 hours.
    Versus the January 2018 average: up by 12.4%

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.