News Release

Kaw River Railroad Announces Lease of Kearney to Birmingham, Missouri, Rail Line from BNSF

FORT WORTH, TEXAS and PITTSBURG, KANSAS April 21, 2005:

Kaw River Railroad (KAW), an affiliate of Watco Companies, Inc., (Watco) and BNSF Railway Company (BNSF) today announced that KAW has entered into a lease agreement for more than 15 route miles of track from BNSF on the Kearney to Birmingham, Mo., line.  KAW is taking over operations on the leased line today, April 21. The KAW trackage will serve existing and potential customers at Kearney, Liberty and Birmingham along the leased track, and the transaction includes related yard, industry and main-line trackage rights.  Commodities on the line are primarily paper and plastics.

Watco CEO Rick Webb is pleased about the opportunity to serve additional customers in the Kansas City area.

"The KAW currently serves a diversified customer base in the Kansas City area so we are looking forward to expanding our operations in Kansas City and providing the same quality service on the Kearney line. Additionally, we appreciate this opportunity from the BNSF. We have a strong relationship with the BNSF and this line addition will allow us to grow our operations in the Kansas City metro area."

Watco Companies, Inc. (Watco), a Pittsburg, Kansas, based company, operates eleven other short line railroads and operates in 19 states. In addition to the Kaw River Railroad, Watco operates the South Kansas and Oklahoma Railroad, the Kansas and Oklahoma Railroad, the Stillwater Central Railroad, the Timber Rock Railroad, the Eastern Idaho Railroad, the Palouse River and Coulee City Railroad, the Pennsylvania Southwestern Railroad, the Great Northwest Railroad, the Mission Mountain Railroad, the Mississippi Southern Railroad and the Appalachian & Ohio Railroad.  Watco also operates industrial switching locations and mechanical and locomotive shops across the United States.

A subsidiary of Burlington Northern Santa Fe Corporation (NYSE:BNI), BNSF Railway operates one of the largest railroad networks in North America, with about 32,000 route miles covering 28 states and two Canadian provinces. BNSF is an industry leader in Web-enabling a variety of customer transactions at www.bnsf.com. The railway is among the world's top transporters of intermodal traffic, moves more grain than any other American railroad, transports the components of many of the products we depend on daily, and hauls enough coal to generate about ten 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