Union Pacific

Beginning in early 2005 we started encountering problems with fuel contaminants in our heritage equipment power cars' fuel systems. We utilize twelve cylinder Deutz & Detroit power plants, running multiple units in train cars (power cars) with twin 300 KW generators. We found a great deal of water in our fuel initially, but in short order started experiencing sludge problems to the extent we had filters and fuel lines plugged to the point of losing power plants on our trains. Not having the ability to provide trainline power to individual train cars with our power cars caused us to use under car back up units. Most of our cars have these units, but not all; another problem.

We were forced to use the under car units which also developed similar fuel sludge problems as the power cars. This meant our last line of defense and back up power was no longer available or reliable. We knew the amount of Sulfur in our fuel supply had dropped in the past year due to regulatory policy and beginning in June 2006 there would be another significant drop in sulfur content to less than fifteen parts per million. So, if we were having problems in early 2005, our concern was that it could and would most likely only get worse; this was not a comfortable feeling with June being the beginning of our busy season. I might add that at the same time we were four years into a failure free maintenance operation record, and the sense of security with that record was fading fast. 

During our encounters with sludge problems we drained and cleaned fuel tanks, replaced fuel lines and filters at a high rate to stay ahead of the problems we were experiencing. We added extra cost factors to prevent failure. Our future did not look good for supporting our failure free record and future f1eet operations going in to our busiest time of the year.

During the summer of 2006, we changed our fuel additive because our fuel tanks were starting to show signs of corrosion and two of our vendors stopped supporting the use of their product. We started using Algae-X AFC-705 Fuel Catalyst, a new product that had several benefits for our staff and fleet. First, AFC-705 did not cause corrosion problems with the fuel tanks. Second, it required much smaller quantities of product than the previous additive and in-turn used a lot less premium storage space on the trains over their journeys sometimes lasting several weeks. We a re now using an eight-ounce bottle per application into our fuel tanks, not two-gallon bottle per application required with our previous additive. 

Just prior to implementing the change to APC-705, we also started using the MTC-lOOO tank-cleaning machine in scheduled service on our power cars and the supplemental or backup power plants under individual cars. We a re very happy, that the damage to our tanks has stopped, our over the road fuel restriction problems have been eliminated and thus our concerns for the power plants ability to perform during the busy season high profile trips has been secured. Opportunity for failure from previous season's concerns has a lso been eliminated.

We have fully implemented AFC-705 fuel catalyst into our preventive maintenance program for the entire fleet a long with the use of the MTC- lOOO tank-cleaning unit. We appreciate your product & equipment for a ll the reasons I have mentioned above. We clearly would not have had a productive and successful season last year without the assistance Algae-X provided. 

Sincerely,

Warren A. Lucas

Manager Heritage Equipment Operations

Union Pacific Railroad Company