Canadian National targets C$1.75B in 2012 capital investments to maintain, improve its network, grow business

MONTREAL , February 17, 2012 (press release) –
CN (TSX: CNR.TO - News) (NYSE: CNI - News) announced today plans to invest C$1.75 billion in 2012 to maintain and upgrade its railway network, support growth and productivity initiatives, and continue to provide customers with a high level of service.

Claude Mongeau, president and chief executive officer, said: "CN is taking its business model to the next level with its focus on Operational and Service Excellence. We are making major strides in improving all customer service touch points, delivering innovative products and achieving end-to-end supply chain collaboration while continually improving productivity. CN's capital spending is critical to running a safe, fluid and productive network and to attaining our growth and service objectives."

More than C$1 billion of CN's 2012 capital investment program will be targeted on track infrastructure to maintain safe railway operations and to enhance the productivity and fluidity of the rail network. This includes replacement of rail, ties and other track materials and bridge improvements.

CN's infrastructure envelope also includes funds for initiatives such as rail-line and yard improvements on the Elgin, Joliet and Eastern Railway Company that CN acquired in 2009, extended sidings along its Edmonton-Prince Rupert, B.C., corridor, and longer passing tracks in Northern Ontario.

Equipment spending, which is intended to improve the quality of the fleet and meet customer requirements, will include the acquisition of new freight cars and locomotive upgrading and is targeted to reach approximately C$150 million in 2012.

CN also expects to spend approximately C$500 million on various projects to take advantage of growth opportunities and to acquire information technology to support Operational and Service Excellence and other opportunities that enhance productivity.

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