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Expressly Prepared For

By Mark E. Luitwieler

A Hat, A Broach, A Pterodactyl ?

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Assessing The Netbacks From Scrapping, Selling And Retrofitting Phased Out Rail Cars To Maximize Fleet Management Profitability • Calculating demand for phased out rail cars for other commodities such as water to identify potential after markets and reduce loss on investments • Analyzing the current steel price to quantify the return on scrapping phased out rail cars • Comparing costs for retrofitting against potential after market returns to determine the most profitable strategy for fleet management • Mapping car storage facilities to identify areas to keep rail cars waiting for retrofitting, selling or scrapping

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A Hat, A Broach, A Pterodactyl ?

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THE TIMELINE ENOUGH TIME?

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RAIL TRANSPORTATION DEMAND BY COMMODITY

RAIL TRANSPORTATION DEMAND BY COMMODITY

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ANNUALIZED COST OF RETROFIT BY PHMSA OPTION

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TANK CAR ATTRITION FORECAST SCRAP OR REPURPOSE?

Below is a table that represents the estimated number of tank cars that will be “scrapped” or “re-purposed” per each PHMSA option and a “Business as Usual” (no change). The numbers are also broken out as with the Keystone XL and W/O KXL.

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STORAGE

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SCRAP OR REPURPOSE? WHAT TO DO WITH THESE CARS…

"   Scrap "   Re-Purpose

"   Transport of Non-Hazardous Liquids "   Water "   Non-Haz Oils ( Animal Fats ,Veg Oil)

"   Storage

"   Continued refinery yield optimizations "   Splitter capacity: How much will come on line and when?