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Release Date:
Release ID: 4390

CN reaches 20th voluntary mitigation agreement (VMA), makes substantial strides in EJ&E integration

VMAs now cover two-thirds of the population along the EJ&E

CHICAGO, Nov. 17, 2009 — CN (TSX: CNR)(NYSE: CNI) announced today a voluntary mitigation agreement (VMA) related to its acquisition of the principal lines of the former Elgin, Joliet and Eastern Railway Company (EJ&E) with the Village of Lake Zurich, Ill., located 37 miles northwest of downtown Chicago. With this agreement, CN has VMAs with 20 municipalities that are home to two-thirds of the population living along the EJ&E in Illinois and Indiana.

CN’s latest VMA will provide funding for a range of environmental measures, including rail noise mitigation, maintenance of an existing quiet zone, emergency response training, safety initiatives, and improved communication. CN completed its EJ&E acquisition on Jan. 31, 2009, and, while traffic volumes overall remain down owing to general economic conditions, CN has rerouted a limited number of its trains over the line.

Jim Vena, senior vice-president, Southern Region, said: “CN has made substantial strides in dealing with the effects of the EJ&E transaction on communities along the line, as well as in integrating the railroad into our North American network. We have been committed to developing constructive working relationships with communities on the EJ&E, and we have been particularly pleased that so many EJ&E municipalities have been willing to undertake productive VMA negotiations with CN. The current number of VMAs – 20 out 33 communities along the EJ&E – and a series of other measures underscore our commitment to work with municipalities to minimize the transaction’s impacts on EJ&E communities and to ensure safe operations.” Such measures include:

- A substantial reduction in the number and duration of vehicular delays caused by trains stopped at EJ&E grade crossings for 10 minutes or more;

- Creation of a section on CN’s website with information about EJ&E construction projects and routine maintenance activities that may affect vehicular traffic;

- Community liaison meetings to follow through with voluntary mitigation agreements and regulatory requirements. These meetings have generated positive partnerships with affected communities and solid feedback to the company;

- Operation Lifesaver presentations at schools to educate children and teenagers about the importance of rail safety and dangers of rail trespass;

- Comprehensive emergency responder training programs offered by CN at its own expense to all communities along the EJ&E, including tank car specialist trainingat Pueblo, Colo. With this training, the Chicago area possesses as high a concentration of highly-qualified experts as any region on the CN system;

- Application of new safety equipment on the EJ&E to monitor rail wheel and bearing conditions, as well as rail lubricators to reduce train noise, and

- Advanced planning for the construction over the next few years of key connections that will enhance the fluidity of train movements along the former EJ&E and CN’s network in the greater Chicago area.

CN has been very transparent in its implementation of this transaction. In compliance with the Surface Transportation Board’s (STB) Dec. 24, 2008, decision approving the EJ&E transaction, CN files monthly operational and quarterly environmental reports at the Board with updates on the status of implementation of the environmental mitigation measures imposed by the agency.

CN has also been actively engaged in a dialogue with EJ&E customers on integration issues and flawlessly cut-over the railway to its computerized operating system that extends the benefits of CN’s Precision Railroading model to EJ&E shippers and receivers.

“CN has been working productively with the communities having VMAs with the company to address a broad range of issues, particularly safety,” Vena said. “And we continue to work with communities along the EJ&E that do not have agreements with CN to ensure we implement the safety and environmental conditions required by the STB. We will strive to work cooperatively with all the EJ&E communities and to smoothly implement this transaction, which will enhance transportation efficiency and generate regional environmental benefits.”

CN expects that full integration of the CN and EJ&E networks will be accomplished within three years.

More information on the acquisition, including a map of the areas served by the EJ&E and CN, is available on CN’s website, www.cn.ca.

Forward-Looking Statements
This news release contains forward-looking statements. CN cautions that, by their nature, forward-looking statements involve risk, uncertainties and assumptions. Implicit in these statements, particularly in respect of long-term growth opportunities, is the Company’s assumption that such growth opportunities are less affected by the current situation in the North American and global economies. The Company cautions that its assumptions may not materialize and that the current economic conditions render such assumptions, although reasonable at the time they were made, subject to greater uncertainty. The Company cautions that its results could differ materially from those expressed or implied in such forward-looking statements. Important factors that could cause such differences include, but are not limited to, the effects of adverse general economic and business conditions, including the recession in the North American economy and the global economic contraction in 2009, industry competition, inflation, currency and interest rate fluctuations, changes in fuel prices, legislative and/or regulatory developments, compliance with environmental laws and regulations, actions by regulators, various events which could disrupt operations, including natural events such as severe weather, droughts, floods and earthquakes, labor negotiations and disruptions, environmental claims, uncertainties of investigations, proceedings or other types of claims and litigation, risks and liabilities arising from derailments, 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 “Management’s Discussion and Analysis” in CN’s annual and interim reports, Annual Information Form and Form 40-F filed with Canadian and U.S. securities regulators, available on CN’s website, for a summary of major risks.

CN assumes no obligation to update or revise forward-looking statements to reflect future events, changes in circumstances, or changes in beliefs, unless required by applicable laws. In the event CN does update any forward-looking statement, no inference should be made that CN will make additional updates with respect to that statement, related matters, or any other forward-looking statement.

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, and Jackson, Miss., with connections to all points in North America. For more information on CN, visit the company’s website at www.cn.ca.

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