Norfolk Southern announced on Wednesday that it expects the costs associated with February’s East Palestine, Ohio train derailment to amount to $387 million. The company anticipates the sum to rise over time, which doesn’t represent the final amount the railroad’s insurance providers will pay out.
The $387 million estimate includes the $30.9 million the railroad promised to assist locals and the residents of East Palestine in recovering from the incident, cleanup costs, community support, restoration payments, legal and advising fees, and an early estimate of claims and settlements.
According to Norfolk Southern, it has already spent almost $55 million to excavate and remove around 31,800 tons of polluted soil and truck away an additional 12.8 million gallons of toxic water.
The first bill figure does not include the sums that might be covered by insurance, the company stated in the release. This would be reflected in upcoming times when recovery is predicted to occur.
The company’s financial standing does appear to have been impacted by the disaster, as Norfolk Southern stated its first-quarter earnings-per-share were down 30 percent from the first quarter of 2022. Additionally, the business announced that first-quarter railway income was $711 million, a reduction of 34 percent from 2022.
On Wednesday, the price of Norfolk Southern’s stock decreased by almost 3 percent from its opening price and by almost 19 percent since the year 2023 began.
Norfolk Southern’s reporting of the $387 million charge comes approximately three months after the train derailment took place.
On February 3rd, 50 train carriages, 10 of which were carrying hazardous materials, derailed as a result of a technical problem with a rail car axle, according to federal authorities. There was vinyl chloride in five of the vehicles. Hundreds of residents evacuated as a result of the controlled release of poisonous gasses that Norfolk Southern carried out on February 6th to stop an explosion.
Officials told East Palestine residents on February 8th that they could safely go home, despite the reports of hundreds of dead fish in the Ohio River near East Palestine and residents complaining of headaches and illness since the derailment.
Despite assurances from government officials that they are safe, many community members said they are fearful and nervous about their exposure to the chemicals and are concerned about air quality and drinking water.
According to Norfolk Southern CEO Alan Shaw, the company will continue to do what it takes to make things right.
“From the beginning, we have been guided by one principle: We are going to do whatever it takes to make it right for East Palestine and the surrounding areas. We are making progress every day and I’m proud of our people. Our response reflects our strategy of focusing on long-term priorities and value,” Shaw said.
Norfolk Southern is facing a special investigation launched last month by the National Transportation Safety Board that it said will look into the company’s organization and safety.
Shaw has expressed support for some additional rail safety measures since the derailment but has resisted others, including legislation requiring two-person rail crews.
The company also faces a lawsuit from Ohio’s Attorney General Dave Yost over costs for the cleanup of the toxic chemical spill and environmental damage, even as it collaborates to establish funds for resident health care, property value issues, and water protections. The federal government is also suing the railroad.
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Hannah Poling is a lead reporter at The Ohio Star and The Star News Network. Follow Hannah on Twitter @HannahPoling1. Email tips to [email protected]
Photo “Norfolk Southern Cleanup” by Norfolk Southern.
