December 20, 2007 10:00 ET

CN urges stakeholders to consider the broad rail transportation efficiency and environmental benefits of EJ&E transaction

CHICAGO, ILLINOIS--(Marketwire - Dec. 20, 2007) - E. Hunter Harrison, president and chief executive officer of CN (TSX:CNR)(NYSE:CNI), said today it's time that public attention in the Chicago area refocuses on the broad rail transportation efficiency and environmental benefits of the Company's planned acquisition of the principal lines of the Elgin, Joliet & Eastern Railway Company (EJ&E).

Harrison said CN is mindful of community concerns about the EJ&E transaction, but believes local debate to date may have been too centered on the potential adverse impact on some communities when a broader examination of the transaction's public interest benefits for the greater Chicago region is warranted.

Harrison said: "CN's acquisition of the major portion of the EJ&E will be the latest in a series of progressive solutions designed to improve the efficiency of its operations as well as the flow of general rail traffic through the greater Chicago area. CN in recent years has developed innovative routing protocols with other major carriers to divert some rail traffic previously interchanged in Chicago to other locations across the central United States. But more needs to be done if Chicago is to play its role as a critical rail transportation hub for the country."

By dispersing its trains along the "J" arc on the periphery of the Chicago metropolitan area, CN's transaction stands to generate broad public interest benefits. It will:

- Increase the speed of commerce through the region by cutting rail congestion in the inner core of Chicago;

- Provide increased transportation capacity in the Chicago region at time when demand for rail transportation is expected to rise;

- Generate significant environmental benefits, including improved rail safety, for millions of people in the greater Chicago area because of shorter transit times resulting in fewer locomotive emissions, fewer blocked crossings and fewer idling trains;

- Provide a head start for the Chicago Region Environmental Transportation Efficiency Program (CREATE), with CN committing US$400 million of private-sector investment to create capacity on the Chicago rail network and by removing CN rail operations from downtown Chicago, and

- Make it possible for the City of Chicago to realize its goal of seeing CN trains vacate the St. Charles Air Line more quickly than under CREATE's Central Corridor scenario so that redevelopment plans for the area may progress, including the site's use in connection with the City's bid for the 2016 Olympic Games. The St. Charles Air Line is a key railroad link that starts at approximately 1600 South and the Chicago River. It proceeds east for seven-tenths of a mile, terminating at Michigan Avenue, where it curves south under McCormick Place and joins another CN line. This area has been targeted for significant redevelopment.

Harrison said CN recognizes that the transaction will require change in a number of communities along the EJ&E. That's why the company has been engaged since announcing this proposed acquisition in a dialogue with affected communities, and is actively supporting the United States Surface Transportation Board's environmental review of the transaction.

Starting in January 2008, CN will start the next phase of its community outreach program, with experts hired by the company helping it to prioritize road crossing and other environmental issues with affected communities.

Harrison said: "CN is seeking a constructive dialogue with key stakeholders to find practical means of implementing the transaction in ways that balance the specific needs of communities with the Chicagoland's need for a cleaner, safer environment and a more efficient rail transportation network.

"The merits of our EJ&E transaction are compelling - compelling for commerce, transportation efficiency and the environment of the greater Chicago region. We are ready to work with communities, and in turn hope for their cooperation to achieve a timely review of this proposed transaction."

CN and United States Steel Corporation announced Sept. 26, 2007, an agreement under which CN will acquire most of the EJ&E for US$300 million, subject to regulatory approval by the Surface Transportation Board (STB). CN plans to spend US$100 million to upgrade EJ&E infrastructure. On Nov. 26, 2007, the Board announced that it would treat CN's acquisition as a "minor" transaction, with a proposed final decision date of April 25, 2008. The Board also announced that it would prepare a full Environmental Impact Statement (EIS) on the transaction, which could require extension of the proposed final decision date. CN urges that the environmental review process be thorough, yet expeditious, to allow for a timely final STB decision on the transaction.

More information on the transaction, including a map of the areas served by the EJ&E and CN, is available by clicking on the EJ&E Acquisition icon on the About CN section of its website

An electronic version of CN's application to the Surface Transportation Board for approval of its transaction is available by clicking on

This news release contains forward-looking statements. CN cautions that, by their nature, forward-looking statements involve risk, uncertainties and assumptions, and while there may be a risk of recession in the United States economy, the Company's assumption is that positive economic conditions in North America and globally will continue, which assumption may not materialize, and that its results could differ materially from those expressed or implied in such statements. Important factors that could cause such differences include, but are not limited to, industry competition, legislative and/or regulatory developments, compliance with environmental laws and regulations, various events which could disrupt operations, including natural events such as severe weather, droughts, floods and earthquakes, the effects of adverse general economic and business conditions, inflation, currency fluctuations, changes in fuel prices, labour disruptions, environmental claims, investigations or proceedings, other types of claims and litigation, and other risks detailed from time to time in reports filed by CN with securities regulators in Canada and the United States. Reference should be made to CN's most recent Form 40-F filed with the United States Securities and Exchange Commission, its Annual Information Form filed with the Canadian securities regulators, and its 2006 Annual Consolidated Financial Statements and Notes thereto and Management's Discussion and Analysis (MD&A), as well as its 2007 quarterly consolidated financial statements and MD&A, for a summary of major risks.

CN - Canadian National Railway Company and its operating railway subsidiaries - spans Canada and mid-America, from the Atlantic and Pacific oceans to the Gulf of Mexico, serving the ports of Vancouver, Prince Rupert, B.C., Montreal, Halifax, New Orleans, and Mobile, Ala., and the key metropolitan areas of Toronto, Buffalo, Chicago, Detroit, Duluth, Minn./Superior, Wis., Green Bay, Wis., Minneapolis/St. Paul, Memphis, St. Louis, and Jackson, Miss., with connections to all points in North America. For more information on CN, visit the company's website at

Contact Information

  • CN
    Mark Hallman (Media)
    Director, Communications, Media & Eastern Region
    (905) 669-3384
    Jim Kvedaras
    U.S. Government & Public Affairs
    (708) 332-3508