Western Coal - Mine To Market

My comments today are directed toward western coal and its impact on Burlington Northern. I will be discussing three major topics. These are: location and extent of mining activities, the flows of this coal traffic into the various market territories, and finally the interaction of this western coal with coals found in the balance of the United States. When we at BN speak of western coal, we refer to those substantial deposits lying in southeastern Montana and north-eastern Wyoming. This territory covers many different coal formations. For the sake of simplicity, I will be referring to this general area as the Powder River Basin (or the "western" coal fields). This slide highlights the area overlayed by a map of the BN rail system. The U.S. Bureau of Mines estimates the demonstrated reserve base of Montana and Wyoming to be approximately 176 billion tons. Of this figure, about 73 billion tons is minable by surface methods. This is roughly 72% of the total strippable reserves in the western united states, BN does not have sole access to this coal for there are deposits in southern Wyoming near the union pacific railroad. I will say more about this later.