CN, BNSF Announce Agreement to Provide Seamless Agricultural Services in Iowa and Illinois.

Business Editors

MONTREAL--(BUSINESS WIRE)--Oct. 23, 2000

Canadian National Railway Company (CN) (TSE:CNR.) (NYSE:CNI) and The Burlington Northern and Santa Fe Railway Company (BNSF) announced today a Service Agreement that provides agricultural products customers with new seamless service using routes in Illinois and Iowa.

Under the agreement, which took effect Sunday, Oct. 15, CN will provide haulage service for BNSF between East Dubuque, Ill., and Cedar Rapids, Iowa, and BNSF will provide haulage service for CN between East Dubuque, Peoria and Centralia, Ill.

For CN customers, the agreement reduces round-trip miles on movements from the Iowa market to grain and oilseed processing areas, Mississippi Valley animal, aquaculture and poultry feeders and the Gulf export market. In addition, it will reduce transit times and train volumes in the Chicago terminal area. CN Iowa unit train programs can now move via Galesburg, Ill., on BNSF instead of on CN's longer route through the Chicago area.

Ed Harris, vice-president of CN's Midwest division, said: "This Service Agreement is an excellent example of CN and BNSF working together after they unwound their combination plan. It will allow CN to increase car and train velocity and provide our customers with new and improved service. More direct access to Decatur, Ill., processors will improve cycle times significantly, as well as cycle times for traffic destined to Mississippi and Gulf markets."

Pete Rickershauser, BNSF's vice-president, Network Development, said: "When we terminated the BNSF/CN combination agreement, we said we would try to capture, to the extent that they can be realized by separate entities, the improvements and efficiencies that were identified as part of the combination preparation.

"This joint effort between BNSF and CN was identified as a rail customer benefit in studies related to the proposed combination. Implementing this Service Agreement provides agricultural commodity shippers and receivers throughout North America with new competitive service offerings, and expanded opportunity and market presence in the Iowa-Illinois markets."

Current and potential customers in BNSF-served grain-producing areas will have what amounts to single-line service to grain processors in Eastern Iowa. Those same processors will likewise have access to various destination markets served by BNSF using this new single-line service offering.

CN spans Canada and mid-America, from the Atlantic and Pacific oceans to the Gulf of Mexico, serving the ports of Vancouver, Prince Rupert, B.C., Montreal, Halifax, New Orleans, and Mobile, Ala., and the key cities of Toronto, Buffalo, Chicago, Detroit, Memphis, St. Louis, and Jackson, Miss., with connections to all points in North America.

Headquartered in Fort Worth, BNSF operates one of the largest rail networks in North America, with 33,500 route miles of track covering 28 states and two Canadian provinces.