Coal Comparisons
FREIGHT
RAIL SYSTEM
Third Quarter 2012 vs. 2011
• Dates back to late 1820’s
• Today, more than 560 freight
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railroads operate in the U.S.
140,000 mile system
Seven largest (Class I)
railroads account for 67% of
total mileage
Almost entirely privately
owned and operated
Funded by private capital
Source: Association of American Railroads
GENERAL CHARACTERISTICS OF U.S.
FREIGHT RAILROADS
• Vast majority privatelyowned, tax-paying firms
• Same company usually owns
the track and operates trains
over it
• No automatic access to
another’s tracks
• Little government funding
• Don’t carry passengers
• Regulation not as onerous as
it once was, but still
substantial (FRA for safety;
STB for rates, service, etc.)
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Source: Association of American Railroads
ENVIRONMENTAL STEWARD
• Moves a ton of freight 469
miles per gallon.
• One train = hundreds of
trucks.
• 4 times more fuel efficient
than trucks.
• Reduces greenhouse gases by
75% compared with trucks.
• Diverting 10% of longdistance truck traffic to rail
would be like taking 2 million
cars off the road or planting
280 million trees.
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Source: Association of American Railroads
HIGHWAY CONGESTION
Forecasted Daily Freight Truck Volume
2012
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Source: U.S. DOT
2035
KEY FACTORS FAVORABLE TO RAIL
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Highway congestion
Fuel efficiency
Driver availability and turnover, and aging truck fleet
Increasing cost structure for trucking
Focus on sustainability
NORFOLK SOUTHERN SYSTEM MAP
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Comparisons
NCoal
ORFOLK
SOUTHERN
Third Quarter 2012 vs. 2011
• Class I railroad
• Safest railroad in North America
• Winner of the E.H. Harriman Memorial Gold
Medal Award for 23 consecutive years
• Originator of more finished vehicles shipments
than any other North American railroad
• Largest Intermodal franchise in the eastern U.S.
• Largest metals franchise of any Class I railroad
• Annual Capital Investment $2 Billion
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NS BUSINESS MIX IN 2012
Volume
Revenue
Agriculture
MetCon
8%
10%
Intermodal
47%
Paper
4%
Chemicals
6%
Automotive
5%
Coal
20%
7.1 Million Units
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Agriculture
13%
Intermodal
20%
MetCon
12%
Paper
7%
Chemicals
14%
Coal
26%
Automotive
8%
$11.0 Billion in Revenue
Coal Comparisons
ECONOMIC
DEVELOPMENT 101
Third Quarter 2012 vs. 2011
• Sites and Buildings
• Appropriate Infrastructure
• Utility – Electric, Gas, Water, Sewer, Telecomm
• Transportation – Highway, Rail, Port
• Labor Force
• Community Support
• Tax Environment
• Speed to Market
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Coal Comparisons
TRENDS
Third Quarter 2012 vs. 2011
• Warehouse Logistics Parks
• Intermodal Logistics
• Private Sector Site Development
• Foreign Direct Investment
• Port Related Development
• Energy Related Development
• Ethanol
• Shale Gas & Shale Oil
• Coal
• Petrochemical Projects
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