(BRK.A), (BRK.B)
High-Speed Intercity Passenger Rail funds currently being invested to bring higher speed passenger rail service in the Pacific Northwest will also bring benefits to BNSF’s freight hauling capacity.
Under the American Recovery and Reinvestment Act (ARRA), a 467-mile rail corridor between Eugene, Oregon and Vancouver, B.C., is being upgraded in order to bring improved passenger rail service for Amtrak’s Cascades service.
In addition to speeding up passenger service, BNSF, which owns the track in the rail corridor, will benefit from the upgrades as well.
The goal of the upgrades is to provide faster travel times and add two additional passenger trains per day. In addition, the goal is to increase freight rail capacity.
The upgrades include new bypass tracks to add capacity, upgrades to warning signal systems, safety-related improvements, and multiple upgrades to existing track. A new rail bridge will cross the Coweeman River near Kelso, Washington, and there will be upgrades to wayside signal systems components at all control points, sidings and turnouts between the U.S./Canada border and Vancouver, Washington.
The upgrades to the wayside signal systems will allow Positive Train Control components (PTC), which are processor-based/communication-based train control system designed to prevent train accidents. PTC will be part of the next generation of passenger locomotives that will be employed in the Cascade service. PTC is a part of the federally mandated systems BNSF and other Class 1 railroads must deploy by Dec. 31, 2015.
Coal Exports Overseas
The corridor is growing in importance as coal from Wyoming is being shipped overseas. According to the Oregon Department of Transportation, freight volume is expected to grow by 60 percent over the next 25 years.
In 2013, Millennium Bulk Terminals submitted an application for a proposed coal export terminal at the site of a former Reynolds Aluminum smelter, in Cowlitz County, Washington. The terminal would ultimately export up to 44 million metric tons of coal annually to China.
Bakken Oil to Refineries
In addition to coal, BNSF runs oil trains from North Dakota’s Bakken formation to refineries in Washington. The trains can run up to 150 tank cars in length.
Currently, passenger service utilizes shared track with freight trains, and a key feature is the creation of sidings that allow freight and passenger trains to pass each other. In addition to creating new sidings, some existing siding tracks will be extended.
The passenger service upgrades will also include station upgrades and eight new locomotives.
The improvements are funded by the federal government in conjunction with Oregon and Washington. In Washington state alone, nearly $800 million in federal high-speed rail funds have been received for the project.
The project is scheduled to be completed by 2017.
© 2015 David Mazor
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.