BCRail To Writedown Assets An Estimated $600 Million

North Vancouver, BC, February 17, 2000, from BCRail website - British Columbia Railway Company, a provincial crown corporation, today announced that its financial statements for the year ended December 31, 1999 will contain a one-time asset impairment charge relating principally to its investment in the northeast coal line. This non-cash charge is estimated at $600 million, with the exact amount to be finalized in March, 2000 when the results of a detailed asset impairment review now underway at the railway will be released along with final year-end audited results.

The Railway included news of this writedown in its most recent quarterly financial submission to the provincial government and says a writedown is required to ensure the value of assets carried in its financial statements does not exceed the future net cash flows generated from those assets. Before this one time charge, 1999 consolidated net income of the BCR Group, on a pre-audit basis, will show a significant improvement over last year of some 39%, to an estimated $33 million.

BC Rail plans to continue servicing the two northeast coal mines along its Tumbler Ridge branchline and indicated that this accounting charge will have no negative impact on continuing operations or the financial health of BC Rail and its subsidiary companies.

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