Post on 16-Aug-2020
transcript
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Union Pacific in Houston: Investing to Meet Freight Demands
Brenda Mainwaring, VP Public Affairs, November 12, 2013
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Agenda
• Union Pacific Overview
• Developing Markets
• Investing for Capacity
• The Future of Rail in Houston, as we see it
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Portland
Oakland
LA
Seattle
SLC
Eastport
Omaha
Twin Cities
Duluth
Denver
Memphis
Port access - 25 Gulf Coast Ports
Chicago
Calexico
El Paso
Eagle Pass
Brownsville
Houston
KC
St. Louis
Laredo
Dallas
New Orleans
Border crossings
Serving all Mexico interchanges and key ports.
2012 Fast Facts (Year End)
• Revenue $20.9 B
• Route Miles 32,000 in
23 States
• Employees 46,000
• Annual Payroll $4.3 B
• Customers 10,000
• Locomotives 8,400
Nogales
4 Source: TxDOT/HTNB study August 2007
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Key commodities show strong growth
8% 9% 10%
27%
Metals (incl pipe)
Industrial Chemicals
Petroleum Products*
Frac Sand
Percent UP Volume Growth 2013 3Q vs 2012 3Q
*Petroleum Products excludes Crude Oil
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Shale-related Business Stats
Pipeline
31% Truck to Canada
Pipelines
1%
Refinery
7%
Rail 61%
Source: North Dakota Pipeline Authority, Aug 2013 estimate
Average Start-up Well Utilizes:
30 – 50 carloads of sand
3 – 5 carloads of drilling pipe
Typical tank car holds
650 barrels of crude oil.
59,000 tank cars on order
as of Sept 2013. Source: Railway Supply Institute
0
50,000
100,000
150,000
200,000
2010 2011 2012 Jan-Sep 2013
Union Pacific Crude Oil Carloads
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These growth commodities are driving UP’s southern region volume growth.
• Southern Region growth outpaced generally flat system growth in FY 2012 vs. FY 2011
– 5% growth in volume
– 9% growth in active workforce
– 9% growth in active locomotive fleet
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What about Houston?
• Commodities with significant growth opportunities predominate in Houston area.
– Energy and byproducts
– Drilling materials
– Chemicals
– Mexico imports/exports
• Houston is consistently UP’s highest volume service unit. Englewood alone averages 1,500 cars per day.
• Union Pacific dispatches more than 100 trains per day in the Houston Terminal complex.
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What does that mean for Houston roadways?
• With 100 trains per day, the Houston Terminal rail network handles the equivalent of tens of thousands of trucks on a daily basis
– Intermodal trains are a highly visible example – one train can take up to 300 trucks off highways
• Union Pacific handles the equivalent of more than 15,000 truckloads of freight in Houston each day
• If that freight traveled on trucks that were stacked nose-to-tail on Houston’s roadway system, the trucks would consume more than 200 lane miles
– One 40-ton truck does as much damage to roadways as 9,600 automobiles, according to a government study cited in USA Today
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Moving goods from ships…
To rail… Instead of roads.
Houston railroads serve public transportation interests.
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Perceived future of Houston rail freight, according to the H-GAC Regional Goods Movement Study (June 2013)
• Rail volume is expected to increase from 152 million tons in 2007 to 218 million tons in 2035
• “…the region’s rail and waterway system may not have sufficient capacity to absorb expected growth.”
• Rail capacity bottlenecks include single track mainlines and bridges, inadequate siding length, and rail yards at or near capacity.
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How will Union Pacific change the picture? Creating Capacity.
• Gateways & Customers
• Capacity & Commercial Facilities
• Infrastructure condition
Process Initiatives
Organizational
Initiatives
“Iron in
the
Ground”
Technology
$
Time
• Distributed Power
• Defect detection
• Simulation tools
• Unified Plan
• Surge resources
• Inventory control
• Variability reduction
• Employee Engagement
• UP Way
Engage
Empower
SupportStandardize
Celebrate & Repeat
150,000
175,000
200,000
Aug2011
Oct2011
Dec2011
Feb2012
Apr2012
Jun2012
Aug2012
Oct2012
Operating Inventory(Freight Cars in Train & Yard Only)
Current172,000
Goal188,000
Freight Cars stored on-line: 33,000
Last Year187,000
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Record Level Private Investment
2003 2006 2009 2012
$2.0
$3.7 ~$3.6
Train
Speed
17.8
mph
21.0
mph
2013E
2013 Capital Plan (In Millions)
Infrastructure Replacement
$1,700
Locomotives/ Equipment
$600
Capacity/ Commercial
Facilities $650
Technology/
Other $200
PTC $450
Increasing Investment ~$32 Billion since 2003*
* Includes Cash Capital, Leases and Other Non-Cash Capital
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Union Pacific’s future for Houston
• Maintain a strong freight railroad
– Improve productivity through process, organization and technology
– Make targeted capacity investments
• Explore public-private partnerships that create greater freight fluidity, for example:
– Belt Junction doubletrack through UP-BNSF diamond – GCRD
– Strang Subdivision doubletrack – near PTRA/Bayport
– Crossing separation and closures – i.e., GCRD West Belt project
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Locations of possible public-private projects.
Settegast
Yard
Old South
Yard [BNSF]
New South
Yard [BNSF]
PTRA
North Yard
MK Yard
T&NO
Jct
Quitman St
Belt Jct
Pierce Jct
West Jct
Rabbit
Crossing
Eureka
Yard
Gulf
Coast
Jct.
Carr St
Hardy St
Yard
Depot Yd
Alvin Algoa Arcola
Congress
Yard
Settegast Jct.
East Belt
Yard
Double
Track Jct
Strang
Yard
Barbours
Cut
Pasadena
Yard
Deer Park Jct
BNSF
Tower 26
Booth
Yard
Tower 87
Chaney
Jct
Tower 30
“Katy Neck”
HL&P
Baytown
Lloyd Yard
“Spring”
Union Pacific RR
Houston Belt & Terminal Railway
Port Terminal Railroad Association
BNSF RR
Rosenberg
Texas City
Galena
Park
Freeport
Angleton
Yard
Baytown
Subdivision
Belt Jct
West Belt
Strang
Sub 2MT
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At-grade Crossings – Houston Terminal Subdivision Example
Settegast
Yard
Old South
Yard [BNSF]
New South
Yard [BNSF]
PTRA
North Yard
MK Yard
T&NO
Jct
Quitman St
Belt Jct
Pierce Jct
West Jct
Rabbit
Crossing
Eureka
Yard
Gulf
Coast
Jct.
Carr St
Alvin Algoa Arcola
Congress
Yard
Settegast Jct.
East Belt
Yard
Double
Track Jct
Strang
Yard
Barbours
Cut
Pasadena
Yard
Deer Park Jct
BNSF
Tower 26
Booth
Yard
Tower 87
Eureka
Jct
Tower 30
“Katy Neck”
HL&P
Baytown
Lloyd Yard
“Spring”
Union Pacific RR
Houston Belt & Terminal Railway
Port Terminal Railroad Association
BNSF RR
Rosenberg
Texas City
Galena
Park
Freeport
Angleton
Yard
Baytown
Subdivision
9 Crossings
Terminal Subdivision
46 At Grade Crossings
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• Three times cleaner than
trucks on a ton-mile basis
• Four times more fuel efficient
than trucks
• Can haul one ton of freight
480 miles on one gallon of fuel
• Each intermodal train can take
up to 300 trucks off highways
Source: EPA, AAR
Transportation Greenhouse Gas Emissions
Freight
RRs 9%
Freight
RRs
43%
Other
Freight
26%
Trucking
31%
Intercity Freight Transportation (Based on Ton Miles)
Trucking
74%
Other
Freight
17%
Rail serves Houston’s transportation needs
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• The highest and best use of rail is to transport freight
– Cleaner, cheaper and more fuel-efficient alternative to trucks
– 1 intermodal train = up to 300 trucks = up to 4 miles of trucks stacked nose-to-tail
• Growing freight rail traffic in Houston will consume available rail capacity
– On a shared line, a typical passenger train can consume as much capacity as 3 freight trains due to priority handling and passenger loading / unloading
– Where freight and passenger operations share limited capacity, a typical passenger train would displace 3 freight trains. For intermodal service, that could return up to 900 trucks to the roadways.
Summing up and looking ahead….