Union Pacific and Progress Rail Services Sign Agreement to Initiate First Testing of Green Technology in Intermediate-Haul Locomotives

Omaha, Neb., September 12, 2008 – Union Pacific Railroad has signed an agreement with Progress Rail Services, a Caterpillar company, to test five SD40-2 locomotives originally built in the 1970s that have been remanufactured with 3005-horsepower low-emission diesel engines.  These locomotives will meet Tier 2 emissions standards, incorporate new emission control technologies, and will be the first ever tested for intermediate-haul routes.

The prototypes are powered by Caterpillar model 3516, 3005-horsepower diesel engines.  They have more power than the typical 2000-horsepower 4-axle Genset "switch" locomotive used around terminals, but are less powerful than the 4400-horsepower 6-axle "line haul" locomotives used for transcontinental freight service. Union Pacific will operate these locomotives in typical regional service in the Midwest and in California. The tests will begin later this year and continue over a 12-month period.

"This is another example of UP's commitment to collaborate with our engine manufacturers to identify, develop and acquire more environmentally friendly locomotives while still meeting our operational needs" said Bob Grimaila - senior assistant vice president Safety and  Environment. "This particular project will allow us to evaluate their ability to perform demanding rail operations, establish the maintenance requirements of the Cat engines and determine their emissions characteristics and the potential for further emissions reductions."

"Progress Rail believes that it is essential to bring proven Cat technologies to the railroad industry," said Billy Ainsworth, president, Progress Rail Services.  "Caterpillar is an established leader in clean diesel technology, including stationary power generation, large mining and construction equipment markets.  By leveraging that expertise we will be able to provide our customers with cutting-edge technology that contributes to their long-term sustainability goals."

The California Air Resources Board (ARB) supports the development of these locomotives, and is providing funding and monitoring the progress of the emission testing.  

"We are pleased to partner with Union Pacific and Progress Rail, and applaud them on their voluntary efforts," said Mary Nichols, ARB chairman. "This is another of several ongoing efforts by our agency to investigate promising technologies that would improve air quality for Californians throughout the state."

About Union Pacific

Union Pacific Corporation owns one of America's leading transportation companies. Its principal operating company, Union Pacific Railroad, links 23 states in the western two-thirds of the country and serves the fastest-growing U.S. population centers. Union Pacific's diversified business mix includes Agricultural Products, Automotive, Chemicals, Energy, Industrial Products and Intermodal. The railroad offers competitive long-haul routes from all major West Coast and Gulf Coast ports to eastern gateways. Union Pacific connects with Canada's rail systems and is the only railroad serving all six major gateways to Mexico, making it North America's premier rail franchise.  www.up.com

About ARB

The Air Resources Board is a department of the California Environmental Protection Agency. ARB's mission is to promote and protect public health, welfare, and ecological resources through effective reduction of air pollutants while recognizing and considering effects on the economy. The ARB oversees all air pollution control efforts in California to attain and maintain health based air quality standards. www.arb.ca.gov

About Progress Rail

Progress Rail, a Caterpillar subsidiary, is one of the largest providers of outsourced maintenance and repair services to the railroad industry in North America. It is headquartered in Albertville, Alabama, and currently has more than 100 facilities throughout the United States, Canada and Mexico. Its customers include all of the major North American, or "Class 1" railroads, as well as regional railroads, public transit authorities, private car owners, railcar builders and lessors, and foundries for steel scrap.  www.progressrail.com

About Caterpillar

For more than 80 years, Caterpillar Inc. has been making progress possible and driving positive and sustainable change on every continent. With 2007 sales and revenues of $44.958 billion, Caterpillar is the world's leading manufacturer of construction and mining equipment, diesel and natural gas engines and industrial gas turbines. The company also is a leading services provider through Caterpillar Financial Services, Caterpillar Remanufacturing Services, Caterpillar Logistics Services and Progress Rail Services.  www.cat.com

For further information, contact Zoe Richmond at (916) 789-6019.

The statements and information contained in the news releases provided by Union Pacific speak only as of the date issued. Such information by its nature may become outdated, and investors should not assume that the statements and information contained in Union Pacific's news releases remain current after the date issued. Union Pacific makes no commitment, and disclaims any duty, to update any of this information.