Surfacing Weekly Update #27

21 October 2004

ELEVEN SURFACING CREWS WORKING HARD TO COMPLETE THIS YEAR’S PROJECTS

As of October 21 we have surfaced over 715 of the 800 pass miles that we had projected to be surfaced in the 2004 production year, over 90% of the total miles scheduled. All information from the field still indicates to us that the schedule will be met or exceeded yet this fall.

There are currently 6 surfacing crews on the DM&E this year. They are Kent Maxon’s east crew, Earl Ruckdashal’s central crew, Jared Hook’s west crew, and Bob Tech’s Black Hills crew and then contractors Railworks and Saetrak assisting on the Huron and Tracy subs. On the IC&E we have Mike Cherne’s south crew, Jason Teynor’s river crew, and Remington Hill’s grain line crew, assisted by contractor Progress Rail, south of the Quad Cities.

¨ The Railworks surfacing crew will work on the DM&E between Verdi and Huron for the remainder of the year. They have been getting excellent production and are currently nearing Cavour.

¨ Safetrak has just recently gotten started and is currently working near Cavour under Kim Camp’s direction

¨ The ARB surfacing crew continues to perform well and has already this year completed work on the Owatonna sub of the IC&E and the Waseca sub of the DM&E. They are currently working near Harvestland elevator on the Tracy sub.

¨ Kent Maxon’s crew is working near the new Florence siding area and when finished will travel back to Garvin and start the final surfacing pass westward toward the state line.

¨ As of October 21, 2004 nearly 240,000 tons of ballast has been distributed on both properties. This is over 90% of the 255,000 tons of ballast that we now believe we will require to complete this year’s projects. The engineering and transportation managers are working very closely with the New Ulm and LG Everist Quarries to complete these deliveries on time.