Ties Weekly Update #19

19 August, 2004

CONTINUING EXCELLENT PRODUCTION

As of August 19, 2004, we have installed nearly 155,000 of the 235,000 ties now scheduled to be installed by November 24^th 2004. All of the tie crews were doing other work for the past week, so no additional ties were installed from the previous week.

¨ As of August 19^th, 220,000 ties have been delivered to our properties and are in the process of being unloaded by the Brandt truck.

¨ Considering the siding additions and extensions and the Florence connection, we now expect to install 235,000 ties this production season.

¨ Wes Risseeuw’s DM&E east tie gang has spent the past week building the extension for the De Smet siding.

¨ The LA Colo tie gang has completed their first three sections of tie installation on the IC&E and DM&E and will now focus on the CWR project on the IC&E. This crew has already installed ties between Austin and Owatonna on the IC&E, and between Owatonna and Mankato, and Sleepy Eye and Garvin on the DM&E. They still need to complete the tie installation between Garvin and the Minnesota/South Dakota state line later in the year.

¨ Foreman Steve Koser’s crew has been installing curve rail on the Mason City and Marquette subs the past couple weeks. They will spend most of the remainder of the year on this curve patch project, except for a short time in September when they will install about 5,000 ties in the Quad Cities area.

¨ Jim Nemec’s west tie gang has completed the section of ties between Rapid City and Hermosa. This tie crew is now on the lower Black Hills sub near Smithwick.

¨ The RJ Corman tie crew returned to the DM&E on the 18^th to install their last section of ties for the year between Brookings and Verdi. They expect to have this section completed by the end of August.