Nate Asplund

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September 20, 2009
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SCORT 2009
Panel Partnering Freight Service
Nate Asplund Director Public Private
Partnerships
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Discussion Topics

• BNSF Introduction
• Nations Network
• Investment
• Successful Partnerships
• Project Examples
• Take Aways

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Connecting Communities and Markets

• Serving 13 of the 19 fastest growing markets
• Connecting over 179 M consumers
• 30 Billion invested since 1997
• Operate 32,000 miles
• Host Amtrak on 7,000 miles
• Host commuter operations in five Metro areas

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Sustainable Partnership OptionsHigher capacity,
lower cost, lower impact

• Fuel Efficiency
• Up 80 since 1980
• Truck 5.3 to 5.1 mpg
• Environment
• More than 60 less CO2 than long-haul truck
• Scalability
• Leverage chokepoint relief
• Constructability
• Less footprint, cost and time

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National Network Trends
Source National Rail Freight Infrastructure
Capacity and Investment Study September 2007 and
AAR
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Supply chain costs are increasing
U.S. Logistics Costs as a Percent of GDP

• What Drove Logistics Costs Down from 1980 to
  2004?
• Transportation deregulation
• Excess capacity
• Low fuel costs

2007 10.1 of GDP (1.4 Trillion)
Inventory / Admin. Costs

• Whats Driving Recent Supply Chain Cost Trends?
• Higher fuel costs
• Congestion
• Aging (legacy) infrastructure
• Public policy
• Increasing U.S. labor costs

0.5T
0.9T
Transportation Costs
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• Source Annual State of Logistics Report,
  Council of Supply Chain Management Professionals

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Will the investment be enough?
Class 1 capital investments needed to meet 2035
freight volume demand
135 B
Shortfall
39 B
26 B
Productivity
70 B
Growth
Source National Rail Freight Infrastructure
Capacity and Investment Study September 2007
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Capital Commitments with ROIC
Millions
2002-2007 ROIC is restated to reflect the change
in methodology for discounting operating leases.
Capital Commitments30B Invested in the last 12
years
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Funding Infrastructure Mobility Impacts Make
Freight Rail PPPs Economically and Politically
Viable
Go-Alone Public Investment in
Highway Maintainability of current system Cost
of adding thousands of new lane miles by
2020 Metro area right-of-way constraints Funding
and Toll-road concerns Energy, environment
safety impacts
Public Impact and Concern Congestion Air Quality
and CO2 Safety Economic Development Delays and
Costs Energy Security Global Competitiveness Cost
of Highway Infrastructure
Partnership Public Investment in Rail Energy,
environment safety benefits More economical
footprint for freight growth Lower construction
cost per GTM System leverage from fixing
chokepoints Private maintenance after construction
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Rail Partner Network Capacity Sponsor ROIC Resour
ces Timing
Public Partner Mandate Benefit Sponsor Funding Pr
ocess Timing
Successful PartnershipsAligning Public and
Private Objectives
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BNSF Project Examples Strong Partnerships Work

• Recent Successes
• Tehachapi Trade Corridor
• Port of Vancouver USA Expansion
• Connect Oregon II
• Burlington Bridge Part I
• Active Projects
• Kansas City Intermodal Facility
• Tower 55
• Hobart Truck Efficiency Project
• Burlington Bridge Part II

Tehachapi Mountains - California
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Take Aways

• Viable Partnership Opportunities
• Improve Capacity, Velocity, Feasibility
• Chokepoints
• Connectors
• Intermodal
• Carload
• PPPs are Only a Part of Meeting the Investment
  Requirement
• Regulatory Environment for Long-Term Investment
  also Critical
• Passenger and Freight Common Ground
• Congestion Relief , Mobility Choices,
  Sustainability, Environment