BNSF budgets a record $6 billion for capex in 2015

BNSF Railway Co. today announced plans to budget a record $6 billion for capital expenditures in 2015. The capex budget marks the third-straight year that BNSF has committed a record amount of capital for infrastructure and rolling stock upgrades.

BNSF also updated its planned capital expenditures for 2014, which now are expected to cost $5.5 billion versus a previously announced $5 billion. From 2000 through 2015's end, the Class I will have reinvested more than $50 billion into its equipment and network to better maintain train traffic fluidity and expand capacity to meet customers’ demands, BNSF officials said in a press release.

"BNSF's capital investment program since the beginning of 2013 through the end of 2015 is unprecedented and is clear evidence of our confidence in a growing economy and our intention to meet the demand for service that comes from all our customers," said President and Chief Executive Officer Carl Ice. "We have made great progress in expanding the segments of our railroad that have been most constrained by rapidly increasing demand. Once these new capital programs are completed, we expect to further restore the capacity flexibility we have historically enjoyed to manage the periodic demand surges that come from a dynamic and fast-paced economic environment."

The largest component of the 2015 capital plan will be $2.9 billion to renew and maintain assets, such as by replacing and upgrading rails, ties and ballast. BNSF also expects to budget about $1.5 billion on expansion projects, nearly $500 million of which will be spent in the Northern Region, where BNSF is experiencing the fastest growth. That region primarily handles agricultural products, coal, crude oil, and materials related to crude oil exploration and production.

BNSF also plans to increase the size of its locomotive fleet through the addition of new energy- and fuel-efficient locomotives. The railroad expects to acquire 330 new locomotives next year to add to its fleet of 7,500 units, and replace others that will soon reach the end of their useful life.