BNSF RAILWAY Safety and Hazmat Overview

BNSF RAILWAY Safety and Hazmat Overview

BNSF s Safety Overview Rail is safest mode of land transportation BNSF s safety vision is to prevent accidents in the first place BNSF has a broad-based risk reduction program Prevention Mitigation Response 2

2013: Safest Year in History From 1980 to 2013 rates for accident, employee injury and crossing collisions fell by over 80% Industry Reportable Rail Equipment Incident Rate (Incidents per Million Train Miles) 4.1 4.4 4.1 3.7 3.4 3.2 2.9 2.7 2.8 2.4 2.4 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Source: FRA Ten Year Overview Calendar Year 3

BNSF: A Safety Leader Incident rate consistently lower than industry average BNSF Reportable Rail Equipment Incident Rate (Incidents per Million Train Miles) 3.4 3.6 3.5 3.3 3.3 3.2 2.6 2.6 2.7 2.2 2.0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Source: FRA Ten Year Overview Calendar Year 4

Rail is a Safe Way to Haul Hazmat 99.997% of rail industry shipments of hazardous materials reach destination without a release caused by a train accident In 2013, BNSF had fewest number of main line derailments in company history Hazmat train accident rates declined by 91% since 1980 5

BNSF s Risk Reduction Program Record capital investments $42 billion since 2000 and an additional record $5 billion in 2014 Employee training and compliance Inspections of infrastructure and equipment 6 6

Capital Commitments $ Billions Replacement Capital Expansion Other PTC Locomotive Equipment $5.0 $3.1 $3.8 $3.4 $3.4 $3.3 $3.6 $3.6 $4.0 $2.3 $1.9 $2.1 $2.0 $2.6 $2.7 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014F 7

Capital Commitments Total 2000 2014F $ Billions $5.0 $46.8 $4.0 $3.6 $3.6 $3.4 $3.3 $2.7 $3.4 $3.8 $2.3 $1.9 $2.1 $2.0 $2.6 $3.1 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014F Total 8

BNSF Employee Focus on Safety Culture of Compliance Identify and address risks Comply with existing rules 100% Focus on critical behaviors: Deadly Decisions Critical Decisions Safety Absolutes Safety Essentials Nothing is more important than returning home safely Culture of Commitment Safety WITH vs. Safety TO Approach others about safety Power of safety is local: Site Safety Teams SIRP and SACP Peer-to-Peer 9

Preventing Accidents in First Place BNSF s employee safety record exceeds the industry average for rail transportation, and is significantly safer than other major industries Injury Rate per 200,000 Employee Hours BNSF Rail Transportation Mining (except oil and gas)* Heavy and civil engineering construction 1.1 1.7 3.0 3.5 2013 was BNSF s all-time lowest injury frequency and severity with ratios down 3% and 16% respectively Truck transportation 4.9 Transportation equipment manufacturing 5.2 Primary metal manufacturing 6.1 Air transportation 7.3 2012 BNSF & Rail Transportation Reportable Rates/ 2011 Industry Results. Sources: US Bureau of Labor Statistics, Federal Railroad Administration, *Mine Safety and Health Administration 10

Prevention: Four Main Causes for Derailments BNSF Reportable Train Accident Causes - 2013 Misc. Equipment 15% 40% Human Factor Track/ Signal 11% 27% 11

Track Record for Safety BNSF s comprehensive inspection process ensures safety of key rail infrastructure by identifying potential problems before they can lead to unsafe conditions: Bridge and track inspections BNSF inspects tracks and bridges more often than required by FRA Most key routes on BNSF are inspected 4 times per week and the busiest main lines are inspected daily Track inspections include state-of-the-art technology to detect internal and external flaws in the rail and track structure Weather & earthquake inspections BNSF receives severe weather warnings 24/7 from private weather data service Special inspection programs for: Storms, high water periods, after earthquakes, extremely hot & cold weather conditions 12

Track Geometry Car Geometry Car Inspections Track Surface Alignment Curve Geometry Gage Rail Wear 13

Railcar Defect Technology Proactive detection improves safety and extends equipment service life Wheel Impact Load Detector Evaluates wheel surface defects Warm Bearing Detection System Monitors excess heat from wheel bearings Hot / Cold Wheel Detector & Technology Drive Train Inspection Measures wheel tread temperature Acoustic Bearing Detector Acoustic Bearing Detector Uses microphone array to evaluate and identify internal journal bearing flaws 14

Positive Train Control Technology Digital wireless communication technology Prevent train-to-train collisions Enforce speed limits Protect roadway workers and equipment Prevent movement of train through a switch left in improper position Interoperability allows operating on other railroads Predictive, advanced train control safety technology 15

Continued Risk Reduction Identifying issues before a problem occurs Operations Equipment Oil Characteristics 16

U.S. Rail Safety Measures after Lac-Mégantic Railroads have implemented FRA s August 2, 2013, Emergency Order: Trains transporting specified hazardous materials will receive increased oversight if carrying: 5 or more loads of Toxic Inhalation Hazard/Poisonous Inhalation (TIH/PIH) materials 20 or more tank loads of flammable or combustible liquids, which primarily includes crude oil and ethanol Identified trains will not be left unattended on main line or siding tracks, outside of yards & terminals, unless railroad has developed a plan identifying specific locations and circumstances when train may be left unattended Exemptions for specific locations require lead locomotive to be locked and/or the operating control handles removed. Mandatory briefing between the train crew and dispatcher regarding securement Emergency Responders Railroads must inspect trains for proper securement after an emergency responder has been on, under or between the cars 17

U.S. Rail Safety Measures after Lac-Mégantic For decades, BNSF and the rail Industry have had our own set of self-imposed best practices for handling hazardous materials, including TIH Recognizing the increase in crude-by-rail, railroads recently chose to apply industry best practices to crude and ethanol shipments Key Trains: Extra precautions are taken to reduce risk for Key Trains moving hazardous materials : Key Train Definition: Tighter definition than required by FRA 1 or more loads of Toxic Inhalation Hazard/Poisonous Inhalation (TIH/PIH) materials 20 or more tank loads of any hazardous materials Special identification and tracking Speed Restrictions for ethanol and crude: 50 mph max speed limit on Key Trains More restrictive exception handling procedures: Wayside detector alarm handling Key Train Routes: wayside wheel bearing detector spacing, frequency of track inspections, minimum track maintenance standards for tracks used to meet or pass Key Trains 18

Tank Car Standards Rail industry voluntarily adopted stronger tank car standards in Oct. 2011 & Nov. 2013: New 1232 Cars vs. Old DOT 111 Cars 1/2 vs.7/16 thick shell ½ extra protective head shield Roll over protection (top fitting protection) DOT 111 Larger pressure release valve 47-77% better crashworthiness DOT ANPRM AAR Comments to PHMSA (November 2013) Aggressive phase out of older style DOT 111 tank car Require jackets and thermal protection on the new style cars 1232 1232 77% better crashworthiness & survival time 19

Industry Safety Actions with U.S. DOT The rail and petroleum industries are working together to ensure shipping crude oil by rail is safe Petroleum industry and PHMSA* determining oil volatility Rail industry analyzing routing protocols and additional speed reduction to reduce risk Railroads, car owners and customers developing future tank car improvements and enhancements * Pipeline and Hazardous Material Safety Administration 20

Specific Actions to be Undertaken by Rail Industry Speed Restrictions: August 2013: Include crude and ethanol in Key Train definition, reducing speed of unit crude trains from max speed of 60 to 50 mph (31% reduction in Kinetic Energy) Now: Municipal speed restrictions of 40 mph for Key Trains carrying crude in DOT-111 tank cars through High Threat Urban Areas (HTUAs) (additional 36% reduction in Kinetic Energy. 56% overall reduction in KE) Risk-based Routing Apply PHMSA s Rail Corridor Risk Management System (RCRMS) and its 27 Risk Factors that define the most safe and secure route for trains carrying TIH/PIH, to the routing of unit crude trains Derailment Prevention Wayside Detector Network a max of 40 mile spacing of Defective Bearing detectors on key train routes Rail Detection At least one additional internal rail inspection than required by Federal Regulations All key crude trains operated with Distributed Power or an operative two-way End of Train Device (ETD) Emergency Response Rail Industry commits up to $5 million to develop and deliver crude-specific hazmat training to emergency responders Rail Industry commits to develop an inventory of emergency response resources 21

Next Generation Tank Car Rail industry calling for further improvements in tank cars carrying crude oil Tank Car Population: 65,000 tank cars in Flammable Liquid service in the U.S. (78% is crude and ethanol) 51,000 are DOT-111 tank cars (7/16 thick shell) 10,000 are non-jacketed CPC-1232 tank cars (1/2 thick shell) 4,000 are jacketed CPC-1232 tank cars (7/16 shell + 1/8 jacket) Proposed Next Generation Tank Car (NGTC) Jacketed 9/16 CPC-1232 tank car with Thermal Protection Retaining the 1232 standard addressed the shipper concerns about loading / unloading Improves crashworthiness by 85% Thermal Protection improves survival time when exposed to a pool fire Reduces payload capacity by 3% vs. jacketed CPC-1232 Key Questions: Mandated for crude & ethanol? Retrofits of existing DOT-111s and CPC-1232s PHMSA will ultimately decide BNSF released RFP to major railcar manufacturers for 5,000 new Next Generation Tank Cars to accelerate the tank car design, production, and bring more certainty to the crude-by-rail tank car market 22

Response: Making a Difference Safety Initiatives Hazmat Training Specialized Staff/Equipment 23

Community Safety Initiatives BNSF earned national TRANSCAER (Transportation Community Awareness and Emergency Response) award 14 times since 1998 Award recognizes national outreach efforts to assist communities in preparing for and responding to possible transportation hazardous material incidents Centerpiece of our training efforts 24

Free Community Hazmat Training BNSF trains an average of 3,500 local emergency responders each year in communities across network More than 65,000 emergency responders trained since 1996 on: Hands-on equipment in field Instructor lead Train list / shipping papers Placards Equipment Incident Assessment 25

Response: Training First Responders Security and Emergency Response Training Center (SERTC) in Pueblo, Colorado, national railroad research/training facility (TTCI) $5 million industry commitment to train first responders on crude oil routes BNSF is covering cost for 736 student spots for the three-day classes BNSF believes first responders must be properly trained to respond safely 26

Emergency Notification: Hazmat GIS BNSF has developed a GIS for emergency incidents Enables BNSF to quickly identify local emergency responders closest to an incident Misc. Sensitive Feature Layers 27

BNSF Hazmat Responder Locations 212 responders at 60 locations Vancouver Seattle Whitefish Portland Klamath Falls Billings Minot Hettinger Gillette Mandan Fargo Superior Minneapolis/ St. Paul La Crosse Bridger Jct Alliance Sioux City Chicago Salt Lake City Ravenna Galesburg Stockton McCook Lincoln Denver Superior Machens Kansas City St. Louis La Junta Bakersfield Arkansas Springfield Mojave Needles Avard Texline City Los Angeles Tulsa San Bernardino Oklahoma Norris Bele Amarillo Memphis Texico City Phoenix n Birmingham Haslet Sweetwater Ft. Worth El Paso Teague Temple Spring Houston New Orleans 28

Specialized Hazmat Equipment Fleet of Industrial fire-fighting foam trailers Emergency breathing air trailers Chlorine kits Midland kits Air monitoring assets 29

Remediation BNSF will restore the site to pre-derailment conditions BNSF is responsible for mitigation of the spill and any restoration tasks BNSF contracts with pre-approved consultants and contractors to perform the remediation and restoration Cameron, Texas, post derailment State agencies oversee the work and BNSF must obtain their concurrence before a site is acceptably closed 30

Questions 31