Port Commission, BNSF Railway to consider historic agreement

For Immediate Release
December 18, 2008

Port of Vancouver may get land, infrastructure, expansion, and dual carrier access

VANCOUVER, Wash. – While final agreements and Port Commission approval are pending, the Port of Vancouver USA and BNSF Railway Company have reached preliminary agreement for a historic transaction facilitating the construction of the port’s $137 million West Vancouver Freight Access project (WVFA).

BNSF has tentatively agreed to sell nearly 17 acres of railroad right-of-way and donate approximately $6 million of accompanying rail infrastructure to the port to allow the construction of the port’s preferred rail alignments. As a part of the deal, the port will finish construction of the project by the end of 2017.

Port customers now use more than 57,000 rail cars annually. Recent studies forecast that rail use at the port could grow to as much as 160,000 rail cars per year when the project is complete and operating. The WVFA expands the dedicated port rail facilities from 18 miles of track to more than 43 miles, providing significant unit train improvements and marked capacity improvements to the Pacific Northwest railroad system that will benefit the region for years to come. Seventy percent of the port’s cargo is currently moved by rail, a number that’s expected to grow to more than 80 percent upon completion of the project. BNSF currently handles all rail services inside the port property, and delivers approximately 20 percent of port traffic for further handling by its competitor, Union Pacific Railroad (UP).

The agreement also opens the way for new commercial rail access for shippers within the port’s expanding marine and industrial facilities at Terminal 4, the Alcoa property (also known as the port’s future Terminal 5) and the future development at Columbia Gateway. As rail service continues to grow providing shippers commercial access to the mainline networks of both BNSF and UP is important. The partnership with BNSF, however, is memorialized in the agreement.

“To ensure the smoothest possible operation of port rail facilities, the port is granting BNSF exclusive rail operator status to directly serve to all of our customers, regardless of carrier.  BNSF and the port will meet regularly to ensure that port customers receive the best possible rail service,” said the port’s Executive Director Larry Paulson.  “BNSF has been deeply involved in the preliminary planning with the port. This is a team effort and we could not have brought the WVFA project to this point without BNSF’s partnership. This is a good example of how public-private partnerships can work.”

BNSF Railway Company has been a key partner to the port throughout the development of the rail project – which broke ground in late 2007 with construction of the eastern-most parts of the project nearly complete just north of the Red Lion Hotel at the Quay.

“The Port of Vancouver USA has demonstrated a vision to anticipate the needs of Vancouver area residents, businesses, employees, and shippers in this increasingly international economic environment.  The West Vancouver Freight Access Project will ensure the continued success of Vancouver, the port, and the region as engines of Pacific Northwest international commerce growth and competitiveness,” said Pete Rickershauser, BNSF Railway vice president of network development. “This transaction is an important milestone in the effective collaboration between the port, the City of Vancouver, BNSF, and the Washington State Department of Transportation in this and other significant Vancouver-area rail projects that will serve the region’s freight and passenger rail needs well into the future.”

Key next steps for the port and BNSF will be to jointly develop new customers to benefit from the rail expansion. The port will be delivering more than 600 acres of new space for marine and industrial use over the next 10-15 years, effectively doubling its size.

“We believe we are the only U.S. West Coast port that has this amount of development potential,” Paulson said. “Rail is more environmentally-friendly than trucking cargo over distances. By rail, one ton of cargo can be moved more than 400 miles on a gallon of fuel.”

The port’s rail project will generate an estimated 1,969 construction jobs that will put more than $130 million in local purchases into the area’s economy, according to an economic impact study done by John Martin & Associates.

About the Port of Vancouver USA
While working on some of the most important port development on the U.S. West Coast, the Port of Vancouver USA is cooperating with its tenants and customers to schedule and maximize business potential during construction. The end result will show why the port is “On Track to the Future,” as the completed developments will mean expansion of business and resulting new jobs for the community.

The Port of Vancouver USA, created by Clark County taxpayers in 1912, is one of the major ports on the Pacific Coast. Its competitive strengths include available land, versatile cargo handling capabilities, vast transportation networks, a dependable labor force and an exceptional level of service to its customers and community.

About BNSF Railway Company
Burlington Northern Santa Fe Corporation's subsidiary BNSF Railway Company operates one of the largest North American rail networks, with about 32,000 route miles in 28 states and two Canadian provinces. BNSF is among the world's top transporters of intermodal traffic, moving more grain than any other American railroad, carries the components of many of the products we depend on daily, and hauls enough low-sulfur coal to generate about ten percent of the electricity produced in the United States. BNSF is an industry leader in Web-enabling a variety of customer transactions at www.bnsf.com.

– POV –