CN announced plans to invest more than C$300 million in rail infrastructure projects in Eastern Canada this year to maintain a safe railway and improve the productivity and fluidity of its network.

CN’s capital spending in its Eastern Region is targeted at replacement of rail, ties and other track materials, and bridge improvements. The Company is also investing in the continuing reconfiguration of MacMillan Yard north of Toronto to permit more efficient terminal operations.

Michael Cory, vice-president, operations, Eastern Region, said: ‘Our investments in rail infrastructure will ensure plant quality and safety for our customers and the communities in which we operate, as well as improve the productivity of MacMillan Yard ’ the largest freight car classification yard on the CN system.’

CN plans to make its spending work harder in 2008 through improved work-block planning and greater labour productivity, made possible through changes negotiated in the four-year labour contract recently ratified by the United Steelworkers, which represents approximately 3,000 CN track maintenance employees in Canada.

Day-to-day rail inspection and maintenance programs will benefit from the roll out of the first phase of CN’s Precision Engineering program. The mobile computer system at the heart of this initiative will help CN manage engineering processes more efficiently, reduce engineering related delays to trains, improve labour efficiency as a result of better information availability, and increase material and machine utilization.

CN’s Eastern Region capital program is part of a plan to invest approximately C$1.5 billion company-wide in 2008, of which more than C$1.1 billion will be focused on track infrastructure. Equipment spending, targeted to reach approximately C$140 million in 2008, will include the acquisition of new fuel-efficient locomotives, as well as improvements to the existing fleet. CN also expects to spend approximately C$250 million on facilities to grow the business, including transloads and distribution centers, information technology to improve service and operating efficiency, and other projects to increase productivity.