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Union Pacific and New Mexico Partner to Create $150M Railroad Facility

Omaha October 5, 2006 - New Mexico Governor Bill Richardson and Union Pacific

Corporation President and CEO Jim Young today announced an agreement that will relocate 285 jobs to a new $150 million terminal facility at Strauss, N.M., about 4 miles west of Santa Teresa. In addition, Union Pacific has also agreed to begin construction of a new Intermodal ramp at this location no later than 2015. Once operational, the ramp is expected to process a minimum of 100,000 container units annually.

"The partnership between Union Pacific and the State of New Mexico is truly historic, and it is another step toward fulfilling my promise to create jobs and build a high-wage economy that benefit the entire state." said Governor Richardson. "This project not only builds industry and creates good jobs, but also lays the groundwork to attract light manufacturing, warehousing and distribution facilities, which could potentially reshape the economy in southern New Mexico."

The project will include a main line locomotive fueling station, a train inspection area and a rail yard.

"Today’s agreement is a testament of how a public/private partnership has the ability to find solutions to benefit both parties," said Young. "This proposed facility will enable us to improve efficiency and expand our operations in the southern New Mexico/western Texas region, which is a part of our critical Sunset Corridor."

Through efforts of the Governor and action in the 2007 session of the Legislature, New Mexico’s gross receipt and compensating tax for locomotive fuel must be removed by July 1, 2009 as a condition for building the proposed 934-acre railroad facility. Many other states, including Texas, already have an exemption on railroad fuel taxes.

In addition, Governor Richardson has committed $5 million to improve a county road connecting the Pete Domenici Highway in Santa Teresa with the new Union Pacific facility in Strauss.

The new facility would be constructed on land currently held by the federal Bureau of Land Management and the New Mexico State Land Office. The process for Union Pacific to acquire the property could take up to 18 months, with construction beginning sometime in 2008 and an anticipated completion of the facility before the end of 2010.

Although certain functions such as fueling, inspections and crew change activities would be transferred to the proposed facility in Strauss, none of the existing facilities in El Paso will be closed. The facility in El Paso is currently at capacity and traffic is expected to continue to grow.

"This is a win for the entire border region, including New Mexico and our neighbors in west Texas and Chihuahua," said New Mexico Economic Development Secretary Rick Homans. "This will be an incredible boost for the regional economy, helping to attract new companies that will create hundreds of related jobs."

Of the 285 jobs proposed at the Strauss facility, 205 would be either engineers or conductors and 80 mechanical employees that fuel or inspect trains.

Union Pacific Names Shane Keller Assistant Vice President-Locomotive Distribution

Omaha October 6, 2006 - Union Pacific Railroad today announced the promotion of Shane Keller to assistant vice president – locomotive distribution, headquartered at the railroad’s Harriman Dispatching Center in Omaha. The promotion is effective immediately.

As assistant vice president – locomotive distribution, Keller, 37, is responsible for the tactical and strategic positioning and productivity of Union Pacific’s more than 8,000 locomotives, to move efficiently the more than 2,000 trains that operate daily across the railroad’s more than 32,400-mile network.

Keller started with Union Pacific as a student intern in 1990 and joined the company’s management trainee program in Omaha in 1992.

He has held a variety of operating positions, including management and director positions in the railroad’s locomotive shops in North Little Rock, Chicago and Fort Worth. Keller was superintendent of transportation services at Union Pacific’s St. Louis Service Unit, general superintendent transportation services in North Platte, Neb., and general superintendent transportation services for the San Antonio Service Unit, a position he held until his recent assignment.

Brian Gorton has been promoted to general superintendent – transportation services for the San Antonio Service Unit, replacing Keller.

As general superintendent – transportation services, Gorton, 39, is responsible for the safe operation of an average of 85 trains a day over 1,500 miles of track in southwestern Texas. The San Antonio Service Unit directly serves 166 rail customers.

The service unit is at the crossroads of Union Pacific’s Texas network with trains running north and south carrying traffic to and from Mexico as well as east-west transcontinental traffic.

Gorton started his career in 1987 with Consolidated Rail Corporation (CONRAIL) in the track maintenance department. He held various positions in the track maintenance and operations departments while at CONRAIL. Gorton joined Union Pacific in 1998 as director – road operations and then director – transportation services in North Little Rock, Ark. He was promoted to superintendent – transportation services of the Wichita Service Unit in August 2005, a position he held until this assignment.

Replacing Gorton in Wichita is Steve Truit, who is promoted to superintendent – transportation services of the Wichita Service Unit. As superintendent – transportation services, Truit, 44, is responsible for the safe operation of an average of 55 trains a day over more than 1,300 miles of track in southeast Kansas, Oklahoma and northwest Arkansas.

Truit began his railroad career with CSX Transportation Inc. in 1982. He held various positions in the railroad’s operations department including trainmaster, terminal superintendent, superintendent and general manager. He began his career with Union Pacific in 2004, and has held several positions in the Operating Department including director of road operations, director of terminal operations and transportation superintendent in Spring, Texas, a position he held until his recent assignment.

Randy Hanks, 44, has been named general director – transportation planning in the railroad’s Network Planning and Operations Department. Hanks is responsible for the analysis and development of the transportation plan integrating rail car, locomotive and train schedules to efficiently meet customer requirements.

Hanks began his railroad career with the BNSF Railway in 1980, joining the Southern Pacific Railroad in 1991. He has held various positions in the operations department including train dispatcher, corridor manager, manager – locomotive planning, director – locomotive management, and superintendent – network control. Union Pacific and Southern Pacific merged in 1996.

Helsinki October 6, 2006 - Two Pendolino tilting trainsets discoupled minutes after the 12-carriage train had pulled off from Helsinki for Joensuu as scheduled at 7.12am (GMT+3) on Friday.

The accident happened in Käpylä when the train was reaching a speed of 80kph.

Leena Linnanmäki, a Finnish Railways (VR) spokeswoman, said the incident had been a technical fault.

An automatic braking system sprang into action as soon as the two units came apart and the approximately 150 passengers were not in danger, Ms Linnanmäki said.

New York October 9, 2006 - David Laney, partner at law firm Jackson Walker LLP and current Chairman of the Board at AMTRAK, will co-chair the upcoming U.S. Infrastructure Investing Summit to be hosted by IQPC on October 18-19 in New York City.

Attendees will benefit from Mr. Laney's extensive experience in corporate and partnership commercial and financial transactions in a broad range of industries. His expertise also includes transportation planning, construction and finance, and he is actively involved in the representation clients in connection with State legislative matters. Mr. Laney is past chairman of the Texas Transportation Commission and a past member of the Texas Turnpike Authority.

Public infrastructure is an emerging asset class that is fast gaining the attention of institutional and private investors alike. Interest stems from the fact that Infrastructure is a long-term, relatively stable asset class that is a unique match to the long-term liabilities of pension funds, endowments, foundations and insurance companies.

Taking place at the Digital Sandbox in New York City, this conference will feature investor- and government-led discussions and bring together other top institutions such as La Caisse de depot et placement du Quebec, Goldman Sachs, the City of Chicago, both Virginia and Texas departments of Transportation, Mayer, Brown, Rowe & Maw LLP. Mr. Laney will co-chair the conference with Richard Ornitz, Chairman of the Americas Infrastructure group at DLA Piper.

Discussions will include:

• Landmark case studies from domestic and international projects

• Various types of infrastructure assets opening up to private investors -- railroads, toll roads, ports, energy, lotteries

• Identifying potential revenue streams and addressing risk factors

• Access to the asset class for large, medium and small investors

• Tax treatment

This summit is organized by the International Quality and Productivity Center (IQPC).

Washington October 5, 2006 - Both Intermodal and carload freight were up on U.S. railroads during September, the Association of American Railroads (AAR) reported today.

The last three weeks of September 2006 were the three highest-volume Intermodal weeks in the history of U.S. railroading, as railroads originated 987,903 Intermodal units during the month, up 50,543 trailers and containers (5.4 percent) from the same month last year. Carload volume also rose, totaling 1,352,159 units, up 4,366 carloads (0.3 percent) from September 2005.

Eleven of the 19 major commodity categories tracked by the AAR saw U.S. carload increases in September 2006 compared to September 2005. Intermodal traffic is not included in carload figures.

Commodities showing carload gains in September 2006 included coal (up 12,667 carloads, or 2.3 percent, to 569,005 carloads); metals and metal products (up 5,339 carloads, or 10.2 percent, to 57,675 carloads); and grain (up 4,457 carloads, or 5.2 percent, to 89,935 carloads).

Commodities showing carload decreases in September 2006 included motor vehicles and equipment (down 11,602 carloads, or 12.4 percent, to 82,144 carloads); nonmetallic minerals (down 5,081 carloads, or 16.3 percent, to 26,046 carloads), and stone, clay, and glass products (down 3,753 carloads, or 8.9 percent, to 38,607 carloads).

In the third quarter, total carloads on U.S. railroads rose 1.1 percent (48,271 carloads) to 4,346,112 carloads, led by coal (up 4.5 percent, or 78,072 carloads), metals and metal products (up 13.5 percent, or 22,192 carloads), and grain (up 5.6 percent, or 15,506 carloads). Carloads of motor vehicles and equipment fell 11.0 percent (28,947 carloads) in the third quarter; carloads of nonmetallic minerals were down 12.1 percent (12,167 carloads); and carloads of lumber and wood products were down 11.7 percent (8,922 carloads).

For the first nine months of 2006, total U.S. rail carloads were up 175,983 carloads (1.4 percent) to 13,136,203 carloads.

U.S. Intermodal traffic was up 182,237 trailers and containers (6.1 percent) in the third quarter and was up 545,939 trailers and containers (6.3 percent) for the first nine months of 2006 to 9,203,475.

Total volume after 39 weeks was estimated at 1.3 trillion ton-miles, up 2.6 percent from 2005.

"An economy as diverse as ours is naturally stronger in some areas than in others, and the fact that freight railroads serve virtually every major sector is reflected in rail traffic figures," noted AAR Vice President Craig F. Rockey. "The U.S. auto sector is not doing well right now, and that has depressed rail carloadings of automotive products. On the other hand, consumer spending still appears to be solid - a factor behind the record-setting Intermodal traffic in September."

Canadian rail carload traffic was down 1,045 carloads (0.3 percent) in September 2006 to 305,550 carloads, up 4,170 carloads (0.4 percent) in the third quarter, and down 32,598 carloads (1.1 percent) for the year to date to 2,909,928 carloads. In September, carload gains in grain (up 7,177 carloads, or 21.9 percent) and chemicals (up 2,660 carloads, or 4.7 percent), among other commodities, offset declines in carloads of motor vehicles and equipment (down 5,451 carloads, or 18.6 percent) and coal (down 5,012 carloads, or 14.9 percent), among others.

Canadian Intermodal traffic was up 8,552 units (4.8 percent) in September 2006 compared with September 2005 to 187,769 units; up 31,651 units (5.6 percent) in the third quarter; and up 96,278 units (5.8 percent) for the first nine months of 2006 to 1,761,895 units.

Carloads carried on Kansas City Southern dé Mexico (formerly Transportación Ferroviaria Mexicana - TFM), a major Mexican railroad, were up 730 carloads (1.6 percent) in September 2006 to 46,817 carloads, while Intermodal units carried totaled 18,858 units, up 2,283 units (13.8 percent). For the year-to-date, KCSM carloads carried were down 4.1 percent (18,866 carloads) to 441,081 carloads, while Intermodal units carried were down 3.5 percent (5,615 units) to 155,627 trailers and containers.

For just the week ended September 30, the AAR reported the following totals for U.S. railroads: 345,299 carloads, up 2.4 percent (7,929 carloads) from the corresponding week in 2005, with loadings down 4.0 percent in the East and up 8.0 percent in the West; Intermodal volume of 258,511 trailers and containers, up 4.9 percent (11,981 units) and the highest week on record; and total volume of an estimated 34.8 billion ton-miles, up 3.6 percent from the equivalent week last year.

For Canadian railroads during the week ended September 30, the AAR reported volume of 78,868 carloads, up 0.3 percent from last year; and 48,766 trailers and containers, up 6.6 percent from the corresponding week in 2005.

Combined cumulative rail volume for the first 39 weeks of 2006 on 13 reporting U.S. and Canadian railroads totaled 16,046,131 carloads, up 0.9 percent (143,385 carloads) from last year, and 10,965,370 trailers and containers, up 6.2 percent (642,217 units) from 2005's first 39 weeks.

Anchorage AK October 10, 2006 - Alaska Railroad (ARRC) crews have opened the mainline track between Talkeetna and Denali National Park. Freight and passenger service has resumed between Anchorage and Fairbanks.

The northbound and southbound Denali Star with service between Anchorage and Fairbanks will be leave on schedule. Delays of up to one hour are expected due to continued clean up efforts.

The ARRC will also run a special Hurricane Turn passenger train offering flag stop service between Talkeetna and Hurricane on Monday, Tuesday and possibly Wednesday. This train will run a normal schedule but minor delays may occur.

Passengers with questions can call (907) 265-2494 or Toll Free at 800-544-0552.

Cummins Hosts EPA Administrator for Introduction of Ultra-Low Sulfur Diesel

Columbus IN October 10, 2006 - Cummins Inc. played host today as U.S. Environmental Protection Agency Administrator Stephen L. Johnson formally kicked off the nationwide switch to ultra-low sulfur diesel fuel (ULSD), which takes effect Oct. 15.

ULSD, which contains 97 percent less sulfur than previous diesel blends, is a critical component of efforts by Cummins and other diesel engine makers to meet stringent new EPA emissions regulations that go into effect Jan. 1, 2007.

Cummins Engine Business President Jim Kelly and Chief Technical Officer, Dr. John Wall led Administrator Johnson on a tour of Cummins test facilities, where the group received a first-hand look at work being done to prepare Cummins to meet the 2007 emissions standards.

Following the tour, Johnson, U.S. Rep. Mike Sodrel (9th District), American Petroleum Institute President Red Cavaney and the Cummins executives spoke about the importance of the new ULSD standards to a group of Cummins employees, industry representatives and the media.

"America’s pumps are primed to deliver on President Bush’s goal of clean diesel and cleaner air," said Johnson. "Over the last century, diesels have been our nation’s economic workhorse – reliable, fuel efficient and long lasting.

"Today, through the President’s investment in clean fuel technology, America’s economic workhorse also is becoming America’s environmental workhorse."

ULSD, when used in combination with emission-reduction technology being developed by Cummins and other engine makers, will result in on-highway diesel engines that produce 90 percent less particulate matter than today’s engines and will greatly reduce emissions of nitrogen oxides (NOx), making these engines among the cleanest on the road. ULSD also works with any diesel engine and is expected to result in a 10 percent emissions reduction in older diesel-powered vehicles.

Lower sulfur levels in the fuel are crucial to achieving reduced emissions, because sulfur hinders exhaust-control devices in diesel engines, much like leaded gasoline once did in gas-powered vehicles. As a result of the new EPA regulations, it would take approximately 60 2007-compliant diesel-powered trucks to emit the amount of soot produced by a single truck made in 1988.

"We’re delighted that the EPA chose Cummins as the location for this important announcement," said Kelly. "Cummins is prepared to meet the 2007 EPA standards, thanks to the hard work of our employees over the last several years, and the unprecedented level of collaboration with the EPA, Congress, the petroleum industry and many others.

"Achieving the new, lower emissions levels would not have been possible without ULSD. This cleaner fuel allows Cummins and others to produce engines that are capable of meeting the new standards without sacrificing performance and reliability."

Cummins 2007 product line will feature the Company’s proven cooled-Exhaust Gas Recirculation (EGR) technology with the addition of an exhaust aftertreatment system. Exhaust aftertreatment for the majority of Cummins customers will be produced by Cummins Emissions Solutions.

Cooled-EGR was Cummins technology solution to meet the 2002 EPA standards, and customers have logged more than 30 billion miles on Cummins cooled-EGR engines over the past four years.

"Cummins has proven that its cooled-EGR technology offers the right balance of power, reliability, fuel economy and low emissions, and we’re confident that our updated version of the technology will be a perfect fit again in 2007," Wall said. "The 2007 product line will be the cleanest engines we have ever produced, and will offer the quality and dependability that are synonymous with Cummins."

Grandi Stazioni Stays on Track With Savvion to Improve Workflow and Streamline Processes Across Italian Train Stations

Santa Clara CA October 10, 2006 - Savvion®, the leading business process management (BPM) company, today announced that Grandi Stazioni, a leading railway management and revitalization company, has successfully implemented Savvion BusinessManager to achieve operational efficiency, streamlined workflow, and improved processes around station management and repair. Savvion BusinessManager is the easiest way for people to collaborate, control, and improve business processes across the enterprise.

Grandi Stazioni is chartered by the Italian government to manage Italy’s 13 most important railway stations, including terminals in Rome, Milan, Florence, and Venice. Prior to Savvion, Grandi Stazioni was unable to effectively track the myriad processes around station maintenance, together with the orders and service agreements the company had with its suppliers. Of the BPM vendors reviewed by Grandi Stazioni, only Savvion provided the web-based interface, rapid implementation timeline, and ability to easily model processes and extend them across multiple business silos.

Since implementing Savvion six years ago, Grandi Stazioni has dramatically streamlined corporate operations, improved budget forecasting and management, cut the time to process order requests by 30 percent, and improved internal auditing for Sarbanes Oxley compliance. In addition, Savvion now enables Grandi Stazioni to monitor contractual agreements they have in place with their service providers and suppliers, ensuring that supplies are shipped in a timely manner and under existing service agreements. If agreements are not met, the company can now successfully leverage fines against their suppliers for breach of contract.

"Over the years Grandi Stazioni has established a reputation of excellence in Italy and beyond for managing the infrastructure maintenance of some of Europe’s premiere railway stations," said Nicola Gazzaneo, CTO of Grandi Stazioni. "Managing railway stations is often encumbered by the number of processes required. Savvion BusinessManager has enabled us to improve multiple key processes around the maintenance of our railway stations, cutting repair time, improving financial transparency, more effectively managing supplier relationships and enhancing the overall customer experience."

"Savvion is pleased to see our software being used to manage and improve the extraordinarily complex processes that surround railway stations," said Patrick Morrissey, senior vice president of marketing and business development for Savvion. "Companies like Grandi Stazioni are leveraging the power of BPM across multiple business units to improve productivity, streamline operations, and drive business success."

In the future, Grandi Stazioni plans to extend its Savvion deployment to manage processes in human resources. Additionally, the company will use Savvion in a clustered environment to control processes around railway station security as well as integrating Savvion’s BPM solution into the mobile devices of personnel for easier access to process management and improvement.

CPR captures 2006 American Honda's "Rail Origin of the Year" Award

Calgary October 10, 2006 - Canadian Pacific Railway has been awarded the "Rail Origin of the Year" award by American Honda Motor Co.

The award recognizes the railway's excellent performance in four key areas; on-time performance, damage prevention, equipment supply and equipment placement and pre-tripping.

"Canadian Pacific Railway was the first North American Class 1 railroad to achieve Honda's Performance Excellence last year. We now have a new program and criteria for measuring Performance Excellence, and once again we see that CPR has risen to the challenge and captured the 'Rail Origin of the Year' award for 2006," said Dave Haney, AVP Auto Distribution and Logistics for American Honda. "Congratulations to CPR and their team for once again meeting the challenge of Performance Excellence for Honda."

"This award from American Honda reflects our commitment to a collaborative approach and in developing and implementing service programs that contribute to our customers' success," said Ray Foot, CPR's Vice President, Merchandise. "The results are a product of a strong dedication and focus on delivering value through our company's integrated operating plan."

Canadian Pacific Railway has worked with American Honda for more than 20 years and provides transportation for its finished vehicles from Canada to locations across North America.

Foot added, "we value our relationship with American Honda and we're proud our integrated team continues to find innovative ways to deliver them a valued rail service."

Atlanta October 4, 2006 - RMI, the market leader and largest independent provider of accurate, reliable, comprehensive and secure rail information services to the transportation industry, today announces an update to its transportation management system, RailConnect TMS. There are currently 330 short line and regional railroads in North America that are managing day-to-day operations with RailConnect TMS.

The enhancements found in RailConnect TMS will provide users with new report and profile options allowing them to make informed, knowledgeable decisions that positively impact their business. The updates not only address customer needs, but also provide more efficient data management.

Additional report capabilities, including a train performance report, have been added to enhance work lists, manage incidental charges, improve yard visibility and assist rail managers in planning for and scheduling trains. A car order module update allows for automatic creation of car orders based on data contained within inbound Electronic Data Interchange (EDI) waybills and users can now define thresholds that will allow orders to expire automatically.

"This release contains several new features that are designed to make RMI’s transportation management system more efficient in regards to data capture, revenue management and report creation," said David Booker, vice president and service design executive for RailConnect TMS.

"As always, we have listened to our users and incorporated their ideas into the product."

RMI plans another TMS release later this year that will facilitate the latest rail EDI standards, as well as additional features for automating the capture and timely reporting of rail events.

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