System-Wide Weekly Update #6

20 May 2004

During past week there has been a rush of activity along the Volga to DeSmet corridor with surfacing, tie installation, crossing renewal, and switch assembly and installation all going on simultaneously. Along with these activities there have also been cranes working to pick up and remove the used rail and OTM from the right of way for sale or use on other projects. The Corman group will return today and start laying rail from Arlington to Lake Preston and we expect that section to be done by the end of the month. The track conditions on the Owatonna sub continue to improve as we continue with dumping ballast and surfacing northward out of Blooming Prairie. This track has been “excepted” for many years and has now been removed from the “excepted” status. Portions of it are starting to get raised up to FRA class 2, which is 25 mph track. Tie installation continues to run ahead of schedule with over 58,000 now installed and surfacing remains strong, with over 120 pass miles now completed. Dirt and sub grade work are completed on the west 8000’ of Cobden and dirt work has started on the Elkton siding and is expected to be completed by the end first week in June.

¨ Equipment continues to be very reliable with only minor breakdowns reported

¨ Some relief has been noted for the gondola supply and we have started receiving ties and bridge material again to give us a little more breathing room

¨ All new, air operated ballast cars have left the supplier and are in route to New Ulm or Brookings for loading. We continue to receive excellent reports from the field on these cars.

¨ Birmingham Diamonds have been loaded and shipped with expected arrival in KC in a week. These pre-plated diamonds will be pre-assembled on site and we now plan installation during the week of July 12^th.