(The following article by Gregory Richards was posted on the Virginian-Pilot website on December 12.)
NORFOLK, Va. — Norfolk Southern Corp. said Monday it plans to spend $1.34 billion in 2007 on capital improvements to its railroad operations, up 16.5 percent from this year.
The investments on such items as track, locomotives and terminals represent an increase from $1.15 billion in 2006 and from $938 million in 2005.
“Our capital budget reflects our commitment to maintain a safe and vibrant rail system to meet the continuing strong demand we anticipate in 2007 and beyond,” Wick Moorman, Norfolk Southern’s chairman and chief executive, said in a statement.
The company owns the 21,200-mile Norfolk Southern Railway, which extends to 22 states, Washington, D.C., and Canada. Norfolk Southern’s operating revenue for the year through September was $7.1 billion.
The spending plan includes $884 million for rail projects, $401 million for equipment and $55 million for small projects and real estate. There are no single “big-ticket” items budgeted for Virginia, Norfolk Southern spokesman Robin Chapman said.
Norfolk Southern said it will buy 53 six-axle locomotives and 1,300 coal cars.
The company anticipates spending $97 million on business development initiatives, such as intermodal terminals and equipment. Intermodal refers to the shipments of truck trailers and international shipping containers by rail.
Additionally, the capital improvement plan includes $28 million for “public-private partnership projects,” such as the $251 million Heartland Corridor project to speed rail shipments between the port of Hampton Roads and the Midwest.
About $9 million of the spending plan is for the Heartland Corridor, Chapman said, which crews will begin working on in the summer. In total, the railroad will spend roughly $100 million on the corridor, he said, with the rest of the cost being paid with federal and state money.