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Fuel Surcharges

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MRL Fuel Surcharge

MRL will assess fuel surcharges on a mileage basis for Agricultural Products and Unit Train Coal customers effective January 1, 2006, and for certain other customers – mostly Industrial Products and other Coal customers - April 25, 2007. Shipments on which a mileage-based fuel surcharge will be assessed are public regulated, non-contract, non-boxcar shipments for which rates have not been prescribed by the Surface Transportation Board (STB). Other customers will continue to pay a fuel surcharge assessed as a percentage of their freight transportation bills. All MRL local (Direct) shipments are converted to a mileage-based fuel surcharge.

We believe a mileage-based fuel surcharge program is the most direct and accurate method of reflecting the impact of fuel price changes on MRL and our customers.

The mileage-based fuel surcharge will apply to Agricultural Products, Coal and certain Industrial Products movements that originate and terminate on MRL, and to BNSF's portion of Rule 11 shipments-a type of interline shipment where each carrier bills the customer separately for their services. For those shipments, customers can compute mileage using the mileage inquiry on the Web at Mileage Inquiry Application.

MRL will be prepared to apply a mileage-based fuel surcharge to interline moves using PC*Miler Rail from ALK Technologies. We will work with our interline partners on joint rates to extend mileage surcharges to those movements. Until mileage-based fuel surcharges can be extended to those movements, joint-rate interline movements with other Class I railroads will continue to be covered by MRL's existing percentage fuel surcharge.

MRL will continue to assess our current fuel surcharge methodologies for customers not covered by the STB's fuel surcharge ruling of January 26, 2007.