System-Wide Weekly Update #19

19 August 2004

The IC&E has had an excellent week installing CWR in the Calmar area with LA Colo’s contract crew, and on the Mason City and Marquette subs with Steve Koser’s IC&E crew. Colo’s crew expects to complete their project that totals 15 track miles around Labor Day. Koser’s crew will mix CWR installation for curve repair with tie installation through the end of the year.

Surfacing crews on both properties continue to make good progress across both systems toward the goal of surfacing over 800 pass miles.

The siding projects on the DM&E are progressing extremely well with 3 in service and another, De Smet, expected to be completed early next week.

The Cobden siding is expected to be completed early in September and the Florence dirt work, which was started a couple weeks ago, is expected to be completed by the end of September, allowing the construction of that siding and connecting track.

The bridge crews are making excellent headway on the Sioux River Bridge near Volga and another crew has completed the rebuild of the Mine Creek Bridge at MP 196.7 on the Tracy sub.

¨ Equipment problems seem to be mostly behind us. This has improved the productivity of all crews.

¨ The last shipment of ties for the DM&E project is on the property, leaving only the ties for the Florence connection left to be delivered. All ties have been delivered and unloaded on the IC&E.

¨ Both of our major ballast suppliers have been challenged by this year’s aggressive schedule, but they are both catching up with their stockpiles so we still expect to meet our surfacing goals.

¨ The Elkton siding, which was put into service the 28^th of July, had its final surfacing completed two weeks ago. The De Smet extension will be put into service no later than the 27^th of August and the remainder of the Cobden siding is expected to be completed by mid to late September.