Exercising an entrepreneurial spirit to seek out investment and expansion opportunities in a struggling economy is rare for most companies. Increasing volumes year-over-year by 35 percent in an industry that has been hit particularly hard is not only extremely difficult, but also impressive. With help from BNSF, Illinois Railway, LLC (IR) has excelled on both of these fronts by investing $15 million into 40 miles of track. As a direct result of this expansion, IR is now better equipped to serve the needs of our mutual customers.
Merril Lieb, assistant vice president, Shortline Development, is pleased with the evolution of BNSF and IR's relationship. "We began working with the sand producers and IR back in 2010, as the demand for frac sand began to grow significantly," Lieb said. "It's great to see the results from all the planning and investments made by all parties. I would like to thank all of the people who played a role in this project to help provide better service to our sand customers."
IR and BNSF work alongside one another at four different interchanges, but the recent success of the Ottawa-Montgomery line in particular deserves attention. IR customers Fairmount Santrol and U.S. Silica account for approximately half of BNSF's total sand volume, as well as almost all of the traffic on the Ottawa-Montgomery line. Due to recent expansion, Fairmount Santrol possesses the capability to mine 7 million tons of sand per year. Since improving their infrastructure, IR averages a unit train and a half of sand per day on the Ottawa-Montgomery line and volumes are up 35 percent in a down market. IR general manager Tom Murphy credits the spike in volumes to IR's flexibility, increased manpower, and close cooperation with BNSF operations.
"We wanted the flexibility for our customers to run as many trains as needed to grow their business," Murphy said. To accomplish this, Murphy knew that IR needed to add to its roster, and consequently hired 26 new employees to staff trains and assist with infrastructure investments. Moreover, he knew that IR needed to make strategic investments in all of their lines to increase safety, efficiency and velocity.
After assuming his current position last July, Murphy sat down with Fairmount Santrol to review their comprehensive operations plan. The first thing that Murphy asked them was: "What is the best scenario for you as the customer to maximize your output?" Aaron Willett, Chad Hartwig and Lynn Hiser from Fairmount Santrol shared their thoughts, ideas and concerns with Murphy. After further collaboration with BNSF, an entirely new operations plan was formed. The new plan is already reaping benefits and garnering impressive numbers. For example, where IR was once able to move up to 150 cars in 24 hours, they can now move the same amount in just eight hours. Thanks to this newfound efficiency, IR now has the capacity to run up to three trains per day in each direction.
Of course, without a solid infrastructure, such efficiency would not be achievable. In addition to improving their operations plan, IR is in the process of adding two sidings, each spanning 7,500 feet, in Serena and Oswego, IL. Along with the siding investments, the entire 40 miles of track is upgraded with 115 pound rail, 15,000 new ties and has been completely resurfaced. Murphy said that these additions have helped greatly with bottlenecks as IR can now operate 24 hours a day. Likewise, IR's newly implemented radio towers better facilitate communication between the mines and the BNSF interchange. With all of these improvements in place, the Ottawa-Montgomery line is now Class II trackage and is averaging 32 unit trains per month. In March, IR moved a record 40 unit trains and expects to move even higher volumes once the improvements are completed in October.
But at the heart of it all, Murphy believes that the true reason for the success between IR and BNSF is increased cooperation and communication. Within IR itself, Murphy credits Gord Anutooshkin, senior vice president of Operations, and Wally Sieruga, vice president of Operations-North Region, for their guidance. "Their willingness to trust me to run this railroad to its highest capabilities is the reason we are where we are today," Murphy said.
Likewise, Murphy cites Tim Merriweather, BNSF terminal superintendent, and his team in Eola, IL for their communication skills. "Our communication has been the key to this success; Tim and his team are quick to note any issues and obstacles that we could face," Murphy said.
Furthermore, the feedback that IR has received from their various customers has indicated that they are receiving one, unified message from both BNSF and IR. "This enhanced communication has resulted in trust with our customers. And when you achieve their trust, you hopefully achieve their future business," Murphy said.