Surfacing Monthly Update #7

19 October 2005

SURFACING CREWS PUTTING FINAL TOUCHES ON PROJECTS

The Surfacing crews on the DM&E and IC&E Railroads will have had another big year in 2005 with more than 925 miles of track now scheduled to be surfaced. Currently there have been over 750 pass miles surfaced this year, over 80% of what is scheduled.

¨ The 53 ballast cars with the air operated gates that were leased for the 2004 season have had the lease extended to 2010 because of the good response the track forces have given them. These cars will continue to be a huge asset for our crews while we unload the over 220,000 tons that will be required for our projects this season. Nearly 180,000 tons of ballast has already been unloaded on the properties.

¨ The three contracting surfacing crews that were added to supplement the 2005 surfacing schedule have completed their projects and all have left the properties.

¨ All Company surfacing crews are now operating on the two properties and over 750 pass miles have already been surfaced of the 925 now scheduled for this production year. Because of some unexpected delays throughout the year, we now expect to complete this 925 miles by Thanksgiving.

¨ This year we have added a late model 6700 production Tamper to Mike Cherne’s south crew and have cascaded his older 6700 to Bruce Wold’s crew in the Quad Cities. This addition has given us 8 full surfacing crews on the two properties with 6700 production tampers as well as several other tampers for smaller projects.