JANUARY 2 sees the start of a major reorganisation of Union Pacific’s Operating Department as part of the merger with Southern Pacific. Four ’regional leadership teams’ were formed on December 1 to manage the transition, which is due for completion by February 28. The Central and Northern regions are based at Omaha, the Southern in Houston, and the Western at Roseville, California.

UP President Jerry Davis has announced plans to invest $220m over the next 10 to 15 years on upgrading 965 km of ex-C&NW grain branches in western Iowa and southern Minnesota. They will be rebuilt to take trains of up to 100 covered hoppers hauled by 6000hp AC locos, running at 64 km/h compared to current speeds as low as 16 km/h.

UP is also to spend $855m over the next five years on its Powder River coal lines in Wyoming and Nebraska. ’Project Yellow III’ is designed to accommodate a projected 50% increase in UP coal traffic by 2000; it includes treble-tracking much of the BN-UP joint line between Bill and Gillette, and 130 km of the UP main line between Gibbon and North Platte. o