D R A F T 1 Coal Comparisons Third Quarter 2012 vs F REIGHT R AIL S YSTEM 1 Dates back to late 1820’s Today, more than 560 freight railroads operate in the U.S. 140,000 mile system Seven largest (Class I) railroads account for 67% of total mileage Almost entirely privately owned and operated Funded by private capital Source: Association of American Railroads

G ENERAL C HARACTERISTICS OF U.S. F REIGHT R AILROADS 2 Vast majority privately- owned, tax-paying firms Same company usually owns the track and operates trains over it No automatic access to another’s tracks Little government funding Don’t carry passengers Regulation not as onerous as it once was, but still substantial (FRA for safety; STB for rates, service, etc.) Source: Association of American Railroads

E NVIRONMENTAL S TEWARD 3 Moves a ton of freight 469 miles per gallon. One train = hundreds of trucks. 4 times more fuel efficient than trucks. Reduces greenhouse gases by 75% compared with trucks. Diverting 10% of long-distance truck traffic to rail would be like taking 2 million cars off the road or planting 280 million trees. Source: Association of American Railroads

H IGHWAY C ONGESTION 4 Forecasted Daily Freight Truck Volume Source: U.S. DOT

K EY F ACTORS F AVORABLE TO R AIL 5 Highway congestion Fuel efficiency Driver availability and turnover, and aging truck fleet Increasing cost structure for trucking Focus on sustainability

N ORFOLK S OUTHERN S YSTEM M AP 6

7 Coal Comparisons Third Quarter 2012 vs Class I railroad Safest railroad in North America Winner of the E.H. Harriman Memorial Gold Medal Award for 23 consecutive years Originator of more finished vehicles shipments than any other North American railroad Largest Intermodal franchise in the eastern U.S. Largest metals franchise of any Class I railroad Annual Capital Investment $2 Billion N ORFOLK S OUTHERN

NS B USINESS M IX IN VolumeRevenue $11.0 Billion in Revenue7.1 Million Units

9 Coal Comparisons Third Quarter 2012 vs Sites and Buildings Appropriate Infrastructure Utility – Electric, Gas, Water, Sewer, Telecomm Transportation – Highway, Rail, Port Labor Force Community Support Tax Environment Speed to Market E CONOMIC D EVELOPMENT 101

10 Coal Comparisons Third Quarter 2012 vs Warehouse Logistics Parks Intermodal Logistics Private Sector Site Development Foreign Direct Investment Port Related Development Energy Related Development Ethanol Shale Gas & Shale Oil Coal Petrochemical Projects T RENDS