News Release

Burlington Northern Santa Fe Offers Industry's First Coal Transportation Options

FORT WORTH, Texas, May 8, 2001:

Internet Auction Slated for May 25, 2001; Options Cover Transportation from Powder River Basin to 11 Rail-Water Terminals

The Burlington Northern and Santa Fe Railway Company (BNSF) today announced creation of the industry’s first coal transportation option contracts. The initial contracts, which will be auctioned on the Internet May 25, 2001, give purchasers the right to move a trainload of coal via BNSF from one of three groups of Powder River Basin mines to one of 11 rail-water terminals at a specified price and at time intervals from three months to 18 months from the date of the auction.

“This innovative product provides utilities, mines and others with the opportunity to lock in transportation capacity and price up to 18 months in advance,” says Tom Kraemer, BNSF’s group vice president, Coal. “Participants in the market have been able to purchase advance commitments for coal and electricity for some time; rail transportation options are the link that completes the supply chain.”

Minimum bid for the options available in the initial auction is $400 for each option contract. Pricing for the transportation itself is provided through a matrix of specific transportation charges for each origin/destination pair. Auction participants must register on the BNSF Web site at www.bnsf.com/business/coal/options/.

Purchasers of options are not required to use the underlying transportation. Those who choose to do so may use BNSF-owned or privately owned coal hopper cars. Specific terms and conditions of the coal train option product are available on the BNSF Web site.

Coal train options will be sold for three, six, 12 and 18 months in advance of the date of the auction. For example, the May 25 auction will include options for transportation in August 2001, November 2001, May 2002 and November 2002. BNSF expects to hold auctions monthly.

“Federal, state and private institutions have pressed for structural change in the regulatory and commercial framework that has governed the electric power industry for years,” says Kraemer. “This transformation in the nature of the market will create new customers, products, service offerings and, most importantly, new opportunities. We hope this product will be of interest to a broad cross-section of industry participants, not only the traditional power generators but also marketers, end-users and traders.”

Although the coal transportation option program does not commit the purchaser to the underlying transportation, BNSF offers several similar advance-transportation-purchase programs to customers in other lines of business. The Certificate of Transportation weekly auction program, established in 1988 for agricultural products customers, and the Loading Origin Guarantees weekly auction program, established in January 2000 for forest products customers, both allow customers to lock in future transportation capacity and price.

A subsidiary of Burlington Northern Santa Fe Corporation (NYSE: BNI), BNSF operates one of the largest railroad networks in North America, with 33,500 route miles of track covering 28 states and two Canadian provinces. BNSF hauls enough coal to generate more than 11 percent of the electricity produced in the United States.

BNSF Headquarters
BNSF Railway Company
2650 Lou Menk Dr. 2nd Floor
P.O. Box 961057
Fort Worth, TX 76161-0057
Phone: (817) 352-1000