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Energy, Powder River Basin, and the DM&E

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[quote user="jeaton"][quote user="futuremodal"][quote user="jeaton"]   The DME plans to spend $6 billion to get the 100 million tons.  I'd venture to say that a mere billion dollars spent by the UP and BNSF could get that twice that much in additional capacity.[/quote]Saving this one![/quote]Save away.<a href="http://www.uprr.com/newsinfo/releases/capital_investment/2006/0508_sprb.shtml">http://www.uprr.com/newsinfo/releases/capital_investment/2006/0508_sprb.shtml</a> [/quote]Yep, that 50 or so miles worth of track addtions will bring them coal rates down and guarantee timely deliveries!Jay, do you remember what it was that caused the inability of BNSF and UP to meet contractual coal commitments?  Derailments due to faulty track maintenance that took out a triple track section.  What makes you think this addition of a third and fourth track alongside the present Joint Line will prevent a repeat of that catastrophy?  Any bets that BNSF/UP will not do more than provide cosmetic improvements in their Joint Line maintenance schedule?After all, those contractual shortfalls haven't yet cost either UP nor BNSF a dime in lost business.  A a single scattering derailment will take out a four main set of tracks as easily as a single set of tracks.  That's the fallacy of thinking that a dollar spent by BNSF/UP is somehow the capacity equivalent of two dollars spent by DM&E.I agree with you that the entry of DM&E will not cause a fall in coal hauling rates, but it will force BNSF and UP to keep the reigns on their own rate increases in the future, not to mention the possibility of lost business if they try to continue to do Joint Line maintenance on the cheap.
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