NEWS: BNSF buys the Du Quoin-St. Louis line from CN

[Anonymous]

QUOTE: Originally posted by nanaimo73

Seca
This is on BNSF's website;

QUOTE: BNSF will obtain trackage rights on CN’s main lines between Memphis and southern Illinois. CN will also transfer its Memphis interlocker to BNSF.

QUOTE: Matthew K. Rose, BNSF’s chairman, president and chief executive officer, said, "These agreements provide BNSF with increased capacity and dispatching efficiencies in Chicago and Memphis. In addition, we now can tap CN’s surplus capacity between Memphis and Centralia, Ill., to expand our ability to handle more traffic."

This would make sense, as IC Grain from Iowa use this route Iowa-GAL-Beardstown-Centralia-IC South. BNSF freights from Memphis would make perfect sense doing the same. Buying the Du Quoin line would not.

[MP173]

Seca:

Lurk no more! An extra set of eyes and ears are always welcomed. I really appreciate the info.

Is Lenox Tower still in service? That is really a great spot. Every time I go to St. Louis (except when the lovely and talented girlfriend, soon be wife is with me) I stop and check out the action. Not many towers left in the St. Louis area.

There has been nothing announced about the Duquoin sale, only rumors. The only thing I can think of, based on your insite regarding the St. Louis routing would be to keep UP from hauling the PRC thru St. Louis on the CN line. Quite a game of chess, if that is it.

They would have the preferred routing on that traffic to Paducah...maybe they already do have the preferred route, dont know, only scratching my head on this.

ed

[samfp1943]

Guys'
First: welcome SECA and Naniamo73, your input and ideas are appreciated, it's kind of interesting to examine and speculate about what is going on on railroads we are familiar with and interested in.
As I said before this whole trackage rights game is about options and a shell game to get out in front of competition, It might be that the BNSF might be also looking for a new corridor FROM the South and Southeast to go North up the IC/CN. Coal is also mined and shipped from the Birmingham area, although not in the PRB coal volumn. BNSF already has a large infrastructure in Memphis, I am not sure what the current volumn is against lines capacity, maybe they are looking at a way around that? The MIssissippi River Bridge is a choke point if it becomes a problem, as it is old. As for the IC/CN Interlocker, all East- West [BNSF,UP] and North- South[IC] is controlled by it, and could really become a point of mischief if the BNSF wanted to give UP pains, at Memphis.
Something else to think about
Thanks,
Sam

[Anonymous]

Could BNSF be trying to bypass Chicago and transfer More Trains in Memphis or Birginham? SO maybe that's the reason they brought the line.

[Anonymous]

QUOTE: Originally posted by bnsfkline

ROFLMAO! Good move BNSF!

Posts: 712
Joined: 03 Oct 2002
Location: St. Louis Area, Florrisant to be specific!!!!!!!!!

ROFLMAO! Good move BNSF!
--------------------
Jim Tiroch

My the Alton and Southern Live forever and Swallow the UP Whole!

The Alton & Southern live forever? How could that be? Both the CNW and Missouri Pacific are extinct. Besides how can you not spell Florissant correctly if you live there? Sorry, I just couldn't resist. [:D]

[samfp1943]

QUOTE: Originally posted by AMTK200

Could BNSF be trying to bypass Chicago and transfer More Trains in Memphis or Birginham? SO maybe that's the reason they brought the line.

AMTK200:
Quite possibly, Chicago is definitely a major bottleneck area and long time point for all sorts of delays, Hoiw long ago was it that UP/Cn were in TRAINS as they had accomplished a trackage rights deal to avoid Chicago. And with the delays there in "CREATE" there is probably no relief in sight for a while. Rerouting a new corridore though Memphis might be an alternative, especially on the East side of the Mississippi, and as I suggested the bridge crossing at Memphis has the potential to be problematic, in particular if it should need a major maintenance program.
Sam

[Anonymous]

I've been reading on and off but have never this question raised of answered.

What IS the difference between TRACKAGE and HAULAGE rights??

TNX,
Chester Howes

[samfp1943]

Chester:
I found this in a TRAINS search.. I have cut and pasted it, as it is pretty definitive and rather than excerpting it and to avoid misquotes, here it is as cut and pasted. I hope you find all your questions answered, And welcome.
Sam
Trackage and haulage rights
How railroads extend their reach
by Michael W. Blaszak

Because shippers' distribution patterns are rarely congruent with any one rail carrier, railroads have developed two traditional methods of extending their reach over each others' lines.

The first is the joint rate and route. Two railroads, by agreement, establish one rate from an origin on the first to a destination on the second. One of the railroads sends the one bill, the shipper returns one check, and the billing railroad pays the other its share, or "division," of the revenue. Each railroad remains individually responsible for providing locomotive and crews for movement over its lines and for loss and damage to the freight while in its possession.

The second method is trackage rights. Here one railroad (the "tenant" line), by agreement, secures the right to operate its trains, typically with its crews, over the track of a second railroad (the "owner"). The trackage used by both railroads is called a "joint facility."

Trackage rights

In contrast with joint routes and rates, under a trackage-rights agreement, the tenant railroad is solely responsible to the shipper for providing transportation service over the joint facility and for loss and damage to the freight.

The owner is compensated through the tenant's payment of a fixed annual sum for the right to use the joint facility plus a variable fee — based on the proportion of the tenant's traffic relative to the total traffic over the joint facility — to compensate it for track maintenance, train dispatching, and other such expenses.

For accounting simplicity, the majority of recent trackage-rights agreements state the tenant line's charge in terms of cents per car-mile or ton-mile.

Trackage rights can be "full service," meaning that the tenant has the right to serve shippers on the joint facility directly, or "overhead" or "bridge" (the terms are synonymous), meaning that the tenant cannot carry freight to and from the owner's customers. Union Pacific's rights over Burlington Northern Santa Fe's Cajon Pass line are an example of full service trackage rights. The vast majority, however, permit the tenant to move only bridge traffic.

In the current deregulated environment, both methods have their disadvantages. The Staggers Act of 1980 greatly reduced the antitrust immunity that protected competing railroads when setting joint rates, while shippers disliked having to bargain with more than one carrier when negotiating one of the newly permitted transportation contracts. Trackage rights agreements, meanwhile, are regulated by the Surface Transportation Board and thus are matters of public record.

Also, traditional employee protection obligations attach to trackage rights. If the employees of a landlord lose work, or their jobs, because a new tenant takes away traffic, they are entitled by federal law to up to six years' pay.

Haulage rights

To avoid these pitfalls, railroads increasingly have turned to haulage arrangements, which separate a railroad's marketing and operating functions.

The railroad receiving haulage rights gets control of marketing. It negotiates the rate or contract with the customer over the entire route. It also supplies the cars and is on the hook for loss and damage.

The railroad granting the haulage rights, meanwhile, retains direct control over operations. It provides the track, train crews, dispatching services, and sometimes the locomotives. In return, the host railroad gets a cents-per-unit payment for each car moved, but it isn't privy to the haulage road’s deals with the shippers.

Shippers like haulage because it centers responsibility for the whole movement, from origin to destination, on just one railroad. There's no complicated haggling with a chain of carriers when the customer wants to change rates or service.

Railroads like the concept because, under a series of federal and court decisions, haulage has been held to be a commercial arrangement outside the STB's trackage rights jurisdiction. That means host railroad employees don't get labor protection — most of the time, they benefit from the additional traffic the haulage road generates — and the railroads do not have to publicly report the terms of their haulage contracts. Secrecy results in confusion over matters such as the location of interchanges and responsibility for car hire — making haulage a sore point for industry accountants — but railroads understandably don't want to tell all about their market advantages.

Confusion over haulage rights is understandable. Professional railroaders themselves are often befuddled by the multitude, complexity, and variety of the haulage arrangements which have proliferated over the past decade.

Santa Fe's route map from 1994 illustrates how one railroad used the haulage concept to expand its commercial influence from coast to coast. The map shows not just the 7600 route-miles Santa Fe operated directly, but at least that many more miles under haulage arrangements. Santa Fe marketed intermodal service to Boston, New York, and Philadelphia through a haulage agreement with Conrail dating back to 1988. Under a haulage agreement with Grand Trunk Western, Santa Fe provided single-line service for trailer-loads of auto parts moving from manufacturers in Mexico to Ford vehicle assembly plants in Ontario. Another agreement with Gateway Western permitted Santa Fe to quote rates to and from St. Louis. In 1993 Santa Fe commenced service to Memphis and Birmingham via haulage service over Burlington Northern. A haulage agreement also was in effect with the Arizona & California Railroad, a regional carrier spun off by Santa Fe in 1991. Santa Fe even extended the haulage concept to motor carriers, which carried intermodal loads under the Santa Fe banner to points as diverse as Winston-Salem, N.C., and Sacramento, Calif.

Outsiders' confusion over how and where railroads serve their customers isn't likely to end soon, since haulage rights will continue to be a useful tool for addressing the railroads' evolving marketing needs.






This article was reprinted from TRAINS Magazine. From the drama and lore of the great railroads of the past to the power and excitement of today’s industry, TRAINS celebrates railroading with insightful articles and stunning photography. TRAINS also answers questions from readers on all aspects of railroading in a popular column called "Ask TRAINS." So become a subscriber today and get the best of railroading — past and present — in TRAINS Magazine!









09/09/2002









Copyright © 2006 Kalmbach Publishing Co.
All rights reserved.

[Anonymous]

QUOTE: Originally posted by MoPacFan
Trains on this line have been backing up lately so I know there is more traffic. I would imagine that traffic wouldnt change due to the fact that they just built the byer's siding on this line only within the last year and they are putting new ties in right now.

Um, Byers has been around for a long time. Trains have been backing up, but what facts do you have to state traffic has increased? There has been a lot of maintenance on the line, that may cause some backups. What time period are you comparing for this increase in traffic?

[Anonymous]

MP; Lennox is still there and active. I spend my time around Gratiot Tower, I like the downtown feel but Lennox is a close second.

I take it CN never sold the line?

[MP173]

I dont think CN sold the line. I have talked to some CN folks in Centralia and they couldnt confirm or deny the sale, but knew of the trackage rights.

Where is Gratiot Tower located? I know it is downtown, but not sure of the exact location. What does it protect...the UP and TRRA?

Also, any other towers on the Illinois side?

Next time down to St. Louis I need to find Gratiot and snap a couple shots for the collection.

Have you ever been up to Ridgely in Springfield, Il?

ed

[BLS53]

I was researching something else, and this old thread popped up on Google. Seems anytime, anything is brought up concerning Paducah, MP173 always  has lots of questions. He seems to have been a prolific poster at one point, but doesn't seem to be on here much anymore. 

The primary use of the BNSF Centralia line is PRB coal going to 2 power plants, and 2 barge loaders. The power plants are at Joppa IL and Chiles KY. The barge facilities are on the Ohio River at Metropolis IL, and Grand Rivers KY on the Tennessee River, in the area between Kentucky and Barkley Lakes.

There is also PRB coal that goes east from Paducah on the Paducah & Louisville (former IC Kentucky Division sold off when they divested their east-west lines in the 1980's). This coal connects with the CSX Chicago-Atlanta line at Madisonville KY. Exactly where it goes south of there, I don't know.

The BNSF and UP (former C&EI line) join just south of Marion IL. There is an equal amount of BNSF and UP coal trains, south of this point into KY.

There is one BNSF local that runs from Centralia to Paducah several times a week. It services a couple of manufacturers in Herrin IL, a Honeywell chemical plant in Metropolis, and a lumber yard in Paducah. Also, the PAL often gets cars headed to the southeast, that are interchanged with the CSX.

All the southern IL coal mines along the BNSF have been closed for some time. There is one Peabody mine in Galatia IL that the CN services. That coal is blended with PRB coal at the Metropolis facility and loaded on to barges. The other remaining mines are further north. One is serviced by the Evansville & Western spinoff of the old L&N Evansville-St. Louis line. I think NS services a few others off their St. Louis-Louisville line.

I don't know the current status of the CN DuQuoin line. UP used to use it for their PRB coal south into the Paducah area. There's a connection over to the Edgewood cut-off at Akin IL, and they would take the straight shot into Paducah from there. When CN bought the IC, and instituted directional running on the main and the cut-off, they terminated the agreement with the UP. Since then, the UP takes an inconvenient, long route down their Chester Sub to Gorham IL, and then proceeds northeast to Benton IL (the same line their Texas-Chicago trains take), where it joins their former C&EI route and the BNSF down to the Ohio River.

[MP173]

BLS53 - thanks for the current update.

I am still here, just not as active as other activities compete for time.  Plus, this forum is not nearly as interesting as it was 10 years ago.  Lots of great folks have left.

Interesting discussion of operations in Southern Ill.  I passed thru Saturday on return trip from Columbus, Ms.  Drove from Fulton, Ky to Cairo, paralleling the IC Mainline of Midamerica.  No trains were seen, but a couple were stacked up north of Fulton.

Cairo - ghost town.  Wow.

Any idea of train volume on the BNSF?  Sounds like 3-4 loads and similar empties per day.  Interesting routing of UP coal trains, but not that bad.

So, is it safe to assume that CN runs bi-directional on Centralia (southbound) and Edgewater cutoff (northbound)?  Crews run Fulton - Centralia/Bluford (still a crew change?).

My IC branchline (Mattoon - Evansville) is long gone and the B&O St. Louis line is nearly gone.  Only a grain move seems to be in play using the B&O to Olney and IC down to the elevator a couple of miles south.

Cant seem to figure out why CN holds on the DuQuoin - EStL line, unless there are daily Memphis - St. Louis trains...or coal.

Thanks,

Ed

[samfp1943]

Remove Post/Photo would not show up. :-(

[My Shadow]

MP173

So, is it safe to assume that CN runs bi-directional on Centralia (southbound) and Edgewater cutoff (northbound)?  Crews run Fulton - Centralia/Bluford (still a crew change?).

Ed 

Ed,

CN operates northbounds via Centralia and southbounds via Bluford.  When directional running was initiated, crew changes at Centralia and Bluford ceased -- with a couple exceptions -- and crews began operating Champaign to Fulton.

[MidlandMike]

Has the Centralia yard been downgraded?

[Vern Moore]

Anonymous

Could BNSF be trying to bypass Chicago and transfer More Trains in Memphis or Birginham? SO maybe that's the reason they brought the line. 

I think you're hitting near the target.  Refer to CP intermodal from Vancover to Chicago discussion and consider the idea of BNSF looking for a faster route for Post Panamax traffic from a connection to the Port of Vancover to Memphis and Birmingham.

Bypassing St Louis and crossing the Mississippi north of there could make such a routing very attractive for deliveries to Memphis and Birmingham or for hand-off to CSX or NS to deliveries further east.