News Release

Gov. Rounds and BNSF Announce Settlement On South Dakota's Core Railroad Line

PIERRE, SD and FORT WORTH, TX, April 29, 2005:

Gov. Mike Rounds and officials from the BNSF Railway Company (BNSF) today announced a settlement agreement that paves the way for the sale of the state-owned Core railroad line to BNSF, while providing enhanced transportation access to markets for South Dakota shippers and producers of agricultural products. The acquisition price is $41.64 million reduced by the value of the properties retained by the state. The sales agreement is subject to approval by the Surface Transportation Board.

"This is great news for our farmers and shippers in South Dakota," said the Governor. "In 1986, the state of South Dakota and BNSF entered into a contract regarding the operation of the Core railroad line in South Dakota. This contract included a formula allowing the BNSF to purchase the Core line under specific conditions at a time of their choosing.  BNSF has exercised their option to purchase the Core line.  As a condition of the sale, we negotiated a settlement agreement protecting and expanding access to the Core line for our South Dakota shippers. This agreement also settles two pending law suits involving the Core line."

The 368-mile Core line runs from Aberdeen to Mitchell, Mitchell to Canton, Canton to Sioux Falls and Mitchell to Sioux City.

"BNSF is pleased to have resolved with the State a win-win outcome that enhances rail service options for shippers in South Dakota and supports our continued investment in the Core line for the future," said Peter J. Rickershauser, BNSF Vice President, Network Development.  "The purchase of the Core line will mark the next step in our successful partnership with the State and freight rail shippers over the last two decades to revitalize and upgrade these once abandoned rail lines.  We look forward to continuing helping to grow business in South Dakota and to investing in this line as an integral part of our extensive western rail network."

In addition to the purchase of the Core line, BNSF has agreed to allow certain access rights to the Core line by smaller, South Dakota based railroads.  While all of these access rights are important, the most notable is expanding access through the BNSF transfer point in Aberdeen.  This agreement will allow agricultural product shippers in South Dakota access to additional markets.

The state of South Dakota purchased the Core line from the Milwaukee Road in 1980.  In 1981, the state and BNSF entered into an agreement in which BNSF would provide rail service on behalf of the state on the Core line for five years.  In 1986, a new agreement was reached in which BNSF agreed to continue operations and the state agreed to allow BNSF to purchase the Core line.

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