10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

  For the quarterly period ended June 30, 2014

OR

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

  For the transition period from            to            

Commission file number            1-11535

BURLINGTON NORTHERN SANTA FE, LLC

(Exact name of registrant as specified in its charter)

Delaware	27-1754839
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

2650 Lou Menk Drive

Fort Worth, Texas

(Address of principal executive offices)

76131-2830

(Zip Code)

(800) 795-2673

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
	Yes  [x]  No  [  ]
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
	Yes  [x]  No  [  ]
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer [  ]  Accelerated filer  [  ]  Non-accelerated filer  [x]  Smaller reporting company  [  ]
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
	Yes  [  ]  No  [x]
Registrant meets the conditions set forth in General Instruction H (1) (a) and (b) of Form 10-Q and is therefore filing this Form 10-Q with the reduced disclosure format permitted by General Instruction H (2).

Table of Contents

PART I	FINANCIAL INFORMATION	PAGE
Item 1.	Financial Statements	3
Item 2.	Management’s Narrative Analysis of Results of Operations	19
Item 4.	Controls and Procedures	22
PART II	OTHER INFORMATION
Item 6.	Exhibits	23
Signatures		S-1
Exhibits		E-1

2

PART I

FINANCIAL INFORMATION

Item 1. Financial Statements.

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(In millions)

(Unaudited)

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
Revenues	$	5,735	$	5,322	$	11,182	$	10,606
Operating expenses:
Compensation and benefits	1,234		1,128		2,452		2,267
Fuel	1,156		1,076		2,315		2,198
Purchased services	634		617		1,287		1,234
Depreciation and amortization	523		489		1,038		972
Equipment rents	225		205		440		403
Materials and other	283		230		602		487
Total operating expenses	4,055		3,745		8,134		7,561
Operating income	1,680		1,577		3,048		3,045
Interest expense	206		177		402		355
Other expense, net	2		3		5		4
Income before income taxes	1,472		1,397		2,641		2,686
Income tax expense	556		513		1,001		1,004
Net income	$	916	$	884	$	1,640	$	1,682

See accompanying Notes to Consolidated Financial Statements.

3

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In millions)

(Unaudited)

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
Net income	$	916	$	884	$	1,640	$	1,682
Other comprehensive income:
Change in amortization of accumulated actuarial losses and prior service credits, net of tax benefit of $0 million, $2 million, $0 million and $4 million, respectively	—		3		—		6
Change in accumulated other comprehensive income of equity method investees	—		1		3		(1		)
Other comprehensive income, net of tax	—		4		3		5
Total comprehensive income	$	916	$	888	$	1,643	$	1,687

See accompanying Notes to Consolidated Financial Statements.

4

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In millions)

(Unaudited)

	June 30, 2014		December 31, 2013
ASSETS
Current assets:
Cash and cash equivalents	$	1,926	$	2,225
Accounts receivable, net	1,320		1,298
Materials and supplies	866		835
Current portion of deferred income taxes	219		358
Other current assets	147		87
Total current assets	4,478		4,803
Property and equipment, net of accumulated depreciation of $2,904 and $2,232, respectively	53,627		52,363
Goodwill	14,819		14,819
Intangible assets, net	666		821
Other assets	2,348		2,224
Total assets	$	75,938	$	75,030
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable and other current liabilities	$	3,461	$	3,206
Long-term debt due within one year	376		645
Total current liabilities	3,837		3,851
Long-term debt	17,505		16,361
Deferred income taxes	17,161		17,224
Intangible liabilities, net	872		961
Casualty and environmental liabilities	661		677
Pension and retiree health and welfare liability	358		362
Other liabilities	1,039		982
Total liabilities	41,433		40,418
Commitments and contingencies (see Notes 5 and 6)
Equity:
Member’s equity	34,257		34,367
Accumulated other comprehensive income	248		245
Total equity	34,505		34,612
Total liabilities and equity	$	75,938	$	75,030

See accompanying Notes to Consolidated Financial Statements.

5

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)

	Six Months Ended June 30,
	2014			2013
OPERATING ACTIVITIES
Net income	$	1,640		$	1,682
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	1,038			972
Deferred income taxes	77			295
Long-term casualty and environmental liabilities, net	(21		)	(13		)
Contribution to defined benefit pension plan	—			(25		)
Other, net	(242		)	(90		)
Changes in current assets and liabilities:
Accounts receivable, net	(23		)	(111		)
Materials and supplies	(31		)	(5		)
Other current assets	(97		)	(112		)
Accounts payable and other current liabilities	411			(422		)
Net cash provided by operating activities	2,752			2,171
INVESTING ACTIVITIES
Capital expenditures excluding equipment	(1,529		)	(1,304		)
Acquisition of equipment	(628		)	(369		)
Other, net	(40		)	3
Net cash used for investing activities	(2,197		)	(1,670		)
FINANCING ACTIVITIES
Proceeds from issuance of long-term debt	1,500			1,500
Payments on long-term debt	(589		)	(111		)
Cash distributions	(1,750		)	(2,000		)
Other, net	(15		)	(12		)
Net cash used for financing activities	(854		)	(623		)
Decrease in cash and cash equivalents	(299		)	(122		)
Cash and cash equivalents:
Beginning of period	2,225			1,794
End of period	$	1,926		$	1,672
SUPPLEMENTAL CASH FLOW INFORMATION
Interest paid, net of amounts capitalized	$	425		$	375
Capital investments accrued but not yet paid	$	196		$	147
Income taxes paid, net of refunds	$	496		$	1,042

See accompanying Notes to Consolidated Financial Statements. 

6

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(In millions)

(Unaudited)

	Member’s Equity			Accumulated Other Comprehensive Income		Total Equity
Balance at December 31, 2013	$	34,367		$	245	$	34,612
Cash distributions to Parent	(1,750		)	—		(1,750		)
Comprehensive income, net of tax	1,640			3		1,643
Balance at June 30, 2014	$	34,257		$	248	$	34,505

See accompanying Notes to Consolidated Financial Statements.

7

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

1. Accounting Policies and Interim Results

The Consolidated Financial Statements should be read in conjunction with Burlington Northern Santa Fe, LLC’s Annual Report on Form 10-K for the year ended December 31, 2013, including the financial statements and notes thereto. Burlington Northern Santa Fe, LLC (BNSF) is a holding company that conducts no operating activities and owns no significant assets other than through its interests in its subsidiaries. The Consolidated Financial Statements include the accounts of BNSF and its majority-owned subsidiaries, all of which are separate legal entities (collectively, the Company). BNSF’s principal operating subsidiary is BNSF Railway Company (BNSF Railway). All intercompany accounts and transactions have been eliminated.

On February 12, 2010, Berkshire Hathaway Inc., a Delaware corporation (Berkshire), acquired 100% of the outstanding shares of Burlington Northern Santa Fe Corporation common stock that it did not already own. The acquisition was completed through the merger (Merger) of a Berkshire wholly-owned merger subsidiary and Burlington Northern Santa Fe Corporation with the surviving entity renamed Burlington Northern Santa Fe, LLC. Earnings per share data has not been presented because BNSF has not issued stock or membership interests to the public.

The results of operations for any interim period are not necessarily indicative of the results of operations to be expected for the entire year. In the opinion of management, the unaudited financial statements reflect all adjustments (consisting of only normal recurring adjustments, except as disclosed) necessary for a fair statement of BNSF’s consolidated financial position as of June 30, 2014, and the results of operations for the three and six months ended June 30, 2014 and 2013.

2. Accounts Receivable, Net

Accounts receivable, net consists of freight and other receivables, reduced by an allowance for bill adjustments and uncollectible accounts, based upon expected collectibility. At June 30, 2014 and December 31, 2013, $48 million and $54 million, respectively, of such allowances had been recorded.

At June 30, 2014 and December 31, 2013, $44 million and $50 million, respectively, of accounts receivable were greater than 90 days old.

3. Other Intangible Assets and Liabilities

Intangible assets and liabilities were as follows (in millions):

	As of June 30, 2014				As of December 31, 2013
	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Intangible assets	$	2,030	$	1,364	$	2,030	$	1,209
Intangible liabilities	$	2,056	$	1,184	$	2,056	$	1,095

Intangible assets primarily consisted of internally developed software and franchise and customer assets. Intangible liabilities primarily consisted of customer and shortline contracts which were in an unfavorable position at the date of Merger.

Amortizable intangible assets and liabilities are amortized based on the estimated pattern in which the economic benefits are expected to be consumed or on a straight-line basis over their estimated economic lives.

Amortization of intangible assets and liabilities was as follows (in millions):

	Six Months Ended June 30,
	2014		2013
Amortization of intangible assets	$	155	$	153
Amortization of intangible liabilities	$	89	$	127

8

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) - (Continued)

Amortization of intangible assets and liabilities for the next five years is expected to approximate the following (in millions):

	Amortization of intangible assets		Amortization of intangible liabilities
Remainder of 2014	$	155	$	90
2015	$	56	$	115
2016	$	33	$	101
2017	$	33	$	96
2018	$	31	$	90

4. Other Assets

In July 2010, the Company entered into a low-income housing partnership (the Partnership) as the limited partner, holding a 99.9% interest in the Partnership. The Partnership is a variable interest entity (VIE), with the purpose of developing and operating low-income housing rental properties. Recovery of the Company’s investment is accomplished through the utilization of low-income housing tax credits and the tax benefits of Partnership losses. The general partner, who holds a 0.1% interest in the Partnership, is an unrelated third party and is responsible for controlling and managing the business and financial operation of the Partnership. As the Company does not have the power to direct the activities that most significantly impact the Partnership’s economic performance, the Company is not the primary beneficiary and therefore, does not consolidate the Partnership. As of June 30, 2014, the assets of the unconsolidated Partnership totaled approximately $375 million. The Company does not provide financial support to the Partnership that it was not previously contractually obligated to provide.    

The Company has accounted for its investment in the Partnership using the effective yield method. The risk of loss of the Company's investment in the Partnership is considered low as an affiliate of the general partner has provided certain guarantees of tax credits and minimum annual returns. The Company’s maximum exposure to loss related to the Partnership is the unamortized investment balance. The following table provides information as of June 30, 2014 (in millions):

Unamortized investment balance classified as Other Assets		Remaining commitments classified as Other Liabilities		Maximum exposure to loss
$	345	$	18	$	345

The remaining commitment of $18 million is expected to be paid in 2014.

5. Debt

Notes and Debentures

In April 2014, the Board of Managers (the Board) of the Company authorized an additional $3 billion of debt securities that may be issued pursuant to the debt shelf registration statement filed with the Securities and Exchange Commission (SEC), for a total of $3.25 billion that remains authorized by the Board to be issued through the SEC debt shelf offering process.

In March 2014, BNSF issued $500 million of 3.750 percent debentures due April 1, 2024 and $1 billion of 4.900 percent debentures due April 1, 2044. The net proceeds from the sale of the debentures will be used for general corporate purposes, which may include but are not limited to working capital, capital expenditures, repayment of outstanding indebtedness and distributions.

The Company is required to maintain certain financial covenants in conjunction with $500 million of certain issued and outstanding junior subordinated notes. As of June 30, 2014, the Company was in compliance with these covenants. In the event of non-compliance, the Company would be required to pay any accrued and unpaid interest.

9

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) - (Continued)

Fair Value of Debt Instruments

At June 30, 2014 and December 31, 2013, the fair value of BNSF's debt, excluding capital leases and unamortized gains on interest rate swaps, was $18,563 million and $16,507 million, respectively, while the book value, which also excludes capital leases and the associated unamortized fair value adjustment under acquisition method accounting related to capital leases and unamortized gains on interest rate swaps, was $17,004 million and $16,066 million, respectively. The fair value of BNSF's debt is primarily based on market value price models using observable market-based data for the same or similar issues, or on the estimated rates that would be offered to BNSF for debt of the same remaining maturities (Level 2 inputs). The fair value of the Company's cash equivalents approximates its carrying value due to the short-term maturities of these instruments.

Guarantees

As of June 30, 2014, BNSF has not been called upon to perform under the guarantees specifically disclosed in this footnote and does not anticipate a significant performance risk in the foreseeable future.

Debt and other obligations of non-consolidated entities guaranteed by the Company as of June 30, 2014, were as follows (dollars in millions):

	Guarantees
	BNSF Ownership Percentage		Principal Amount Guaranteed		Maximum Future Payments		Maximum Recourse Amounta		Remaining Term (in years)	Capitalized Obligations
Kinder Morgan Energy Partners, L.P.	0.5	%	$	190	$	190	$	—	Termination of Ownership	$	2	b
Chevron Phillips Chemical Company LP	—	%	N/Ad		N/Ad		N/Ad		3	$	5	c

^a  Reflects the maximum amount the Company could recover from a third party other than the counterparty.

^b  Reflects capitalized obligations that are recorded on the Company’s Consolidated Balance Sheet.

^c  Reflects the asset and corresponding liability for the fair value of these guarantees required by authoritative accounting guidance related to guarantees.

^d  There is no cap to the liability that can be sought from BNSF for BNSF’s negligence or the negligence of the indemnified party. However, BNSF could receive reimbursement from certain insurance policies if the liability exceeds a certain amount.

Kinder Morgan Energy Partners, L.P.

Santa Fe Pacific Pipelines, Inc., an indirect, wholly-owned subsidiary of BNSF, has a guarantee in connection with its remaining special limited partnership interest in Santa Fe Pacific Pipeline Partners, L.P. (SFPP), a subsidiary of Kinder Morgan Energy Partners, L.P., to be paid only upon default by the partnership. All obligations with respect to the guarantee will cease upon termination of ownership rights, which would occur upon a put notice issued by BNSF or the exercise of the call rights by the general partners of SFPP.

Chevron Phillips Chemical Company LP

In 2007, BNSF entered into an indemnity agreement with Chevron Phillips Chemical Company LP (Chevron Phillips), granting certain rights of indemnity from BNSF, in order to facilitate access to a new storage facility. Under certain circumstances, payment under this obligation may be required in the event Chevron Phillips were to incur certain liabilities or other incremental costs resulting from trackage access.

10

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) - (Continued)

Indemnities

In the ordinary course of business, BNSF enters into agreements with third parties that include indemnification clauses. The Company believes that these clauses are generally customary for the types of agreements in which they are included. At times, these clauses may involve indemnification for the acts of the Company, its employees and agents, indemnification for another party’s acts, indemnification for future events, indemnification based upon a certain standard of performance, indemnification for liabilities arising out of the Company’s use of leased equipment or other property, or other types of indemnification. Despite the uncertainty whether events which would trigger the indemnification obligations would ever occur, the Company does not believe that these indemnity agreements will have a material adverse effect on the Company’s results of operations, financial position or liquidity. Additionally, the Company believes that, due to lack of historical payment experience, the fair value of indemnities cannot be estimated with any amount of certainty. However, the fair value of any such amount would be immaterial to the Consolidated Financial Statements. Agreements that reflect unique circumstances, particularly agreements that contain guarantees that indemnify for another party’s acts, are disclosed separately, if appropriate. Unless separately disclosed above, no fair value liability related to indemnities has been recorded in the Consolidated Financial Statements.

Variable Interest Entities - Leases

BNSF Railway has entered into various equipment lease transactions in which the structure of the lease contains VIEs. These VIEs were created solely for the lease transactions and have no other activities, assets or liabilities outside of the lease transactions. In some of the arrangements, BNSF Railway has the option to purchase some or all of the equipment at a fixed-price, thereby creating variable interests for BNSF Railway in the VIEs. The future minimum lease payments associated with the VIE leases were approximately $3 billion as of June 30, 2014.

In the event the leased equipment is destroyed, BNSF Railway is obligated to either replace the equipment or pay a fixed loss amount. The inclusion of the fixed loss amount is a standard clause within equipment lease arrangements. Historically, BNSF Railway has not incurred significant losses related to this clause. As such, it is not anticipated that the maximum exposure to loss would materially differ from the future minimum lease payments.

BNSF Railway does not provide financial support to the VIEs that it was not previously contractually obligated to provide.

BNSF Railway maintains and operates the equipment based on contractual obligations within the lease arrangements, which set specific guidelines consistent within the industry. As such, BNSF Railway has no control over activities that could materially impact the fair value of the leased equipment. BNSF Railway does not hold the power to direct the activities of the VIEs and therefore does not control the ongoing activities that have a significant impact on the economic performance of the VIEs. Additionally, BNSF Railway does not have the obligation to absorb losses of the VIEs or the right to receive benefits of the VIEs that could potentially be significant to the VIEs. Depending on market conditions, the fixed-price purchase options could potentially provide benefit to the Company; however, any benefits potentially received from a fixed-price purchase option are expected to be minimal. Based on these factors, BNSF Railway is not the primary beneficiary of the VIEs. As BNSF Railway is not the primary beneficiary and the VIE leases are classified as operating leases, there are no assets or liabilities related to the VIEs recorded in the Company's Consolidated Balance Sheet.

6. Commitments and Contingencies

Personal Injury

Personal injury claims, including asbestos claims and employee work-related injuries and third-party injuries (collectively, other personal injury), are a significant expense for the railroad industry. Personal injury claims by BNSF Railway employees are subject to the provisions of the Federal Employers’ Liability Act (FELA) rather than state workers’ compensation laws. FELA’s system of requiring the finding of fault, coupled with unscheduled awards and reliance on the jury system, contributed to increased expenses in past years. Other proceedings include claims by non-employees for punitive as well as compensatory damages. A few proceedings purport to be class actions. The variability present in settling these claims, including non-employee personal injury and matters in which punitive damages are alleged, could result in increased expenses in future years. BNSF has implemented a number of safety programs designed to reduce the number of personal injuries as well as the associated claims and personal injury expense.

11

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) - (Continued)

BNSF records an undiscounted liability for personal injury claims when the expected loss is both probable and reasonably estimable. The liability and ultimate expense projections are estimated using standard actuarial methodologies. Liabilities recorded for unasserted personal injury claims are based on information currently available. Due to the inherent uncertainty involved in projecting future events such as the number of claims filed each year, developments in judicial and legislative standards and the average costs to settle projected claims, actual costs may differ from amounts recorded. Expense accruals and any required adjustments are classified as materials and other in the Consolidated Statements of Income.

Asbestos

The Company is party to a number of personal injury claims by employees and non-employees who may have been exposed to asbestos. The heaviest exposure for BNSF employees was due to work conducted in and around the use of steam locomotive engines that were phased out between the years of 1950 and 1967. However, other types of exposures, including exposure from locomotive component parts and building materials, continued after 1967 until they were substantially eliminated at BNSF by 1985.

BNSF assesses its unasserted asbestos liability exposure on an annual basis during the third quarter. BNSF determines its asbestos liability by estimating its exposed population, the number of claims likely to be filed, the number of claims that will likely require payment and the estimated cost per claim. Estimated filing and dismissal rates and average cost per claim are determined utilizing recent claim data and trends.

Throughout the year, BNSF monitors actual experience against the number of forecasted claims and expected claim payments and will record adjustments to the Company's estimates as necessary.

Based on BNSF’s estimate of the potentially exposed employees and related mortality assumptions, it is anticipated that unasserted asbestos claims will continue to be filed through the year 2050. The Company recorded an amount for the full estimated filing period through 2050 because it had a relatively finite exposed population (former and current employees hired prior to 1985), which it was able to identify and reasonably estimate and about which it had obtained reliable demographic data (including age, hire date and occupation) derived from industry or BNSF specific data that was the basis for the study. BNSF projects that approximately 60, 80 and 95 percent of the future unasserted asbestos claims will be filed within the next 10, 15 and 25 years, respectively.

Other Personal Injury

BNSF estimates its other personal injury liability claims and expense quarterly based on the covered population, activity levels and trends in frequency and the costs of covered injuries. Estimates include unasserted claims except for certain repetitive stress and other occupational trauma claims that allegedly result from prolonged repeated events or exposure. Such claims are estimated on an as-reported basis because the Company cannot estimate the range of reasonably possible loss due to other non-work related contributing causes of such injuries and the fact that continued exposure is required for the potential injury to manifest itself as a claim. BNSF has not experienced any significant adverse trends related to these types of claims in recent years.

BNSF monitors quarterly actual experience against the number of forecasted claims to be received, the forecasted number of claims closing with payment and expected claim payments. Adjustments to the Company’s estimates are recorded quarterly as necessary or more frequently as new events or revised estimates develop.

The following tables summarize the activity in the Company’s accrued obligations for asbestos and other personal injury matters (in millions):

	Three Months Ended June 30,
	2014			2013
Beginning balance	$	386		$	453
Accruals	18			29
Payments	(19		)	(15		)
Ending balance	$	385		$	467

12

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) - (Continued)

	Six Months Ended June 30,
	2014			2013
Beginning balance	$	387		$	462
Accruals	36			55
Payments	(38		)	(50		)
Ending balance	$	385		$	467

At June 30, 2014, $85 million was included in current liabilities. In addition, defense and processing costs, which are recorded on an as-reported basis, were not included in the recorded liability. The Company is primarily self-insured for personal injury claims.

Because of the uncertainty surrounding the ultimate outcome of personal injury claims, it is reasonably possible that future costs to settle personal injury claims may range from approximately $340 million to $455 million. However, BNSF believes that the $385 million recorded at June 30, 2014, is the best estimate of the Company’s future obligation for the settlement of personal injury claims.

The amounts recorded by BNSF for personal injury liabilities were based upon currently known facts. Future events, such as the number of new claims to be filed each year, the average cost of disposing of claims, as well as the numerous uncertainties surrounding personal injury litigation in the United States, could cause the actual costs to be higher or lower than projected.

Although the final outcome of personal injury matters cannot be predicted with certainty, considering among other things the meritorious legal defenses available and liabilities that have been recorded, it is the opinion of BNSF that none of these items, when finally resolved, will have a material adverse effect on the Company’s financial position or liquidity. However, the occurrence of a number of these items in the same period could have a material adverse effect on the results of operations in a particular quarter or fiscal year.

BNSF Insurance Company

The Company has a consolidated, wholly-owned subsidiary, Burlington Northern Santa Fe Insurance Company, Ltd. (BNSF IC) that provides insurance coverage for certain risks, FELA claims, railroad protective and force account insurance claims and certain excess general liability and property coverage, and certain other claims which are subject to reinsurance. BNSF IC has entered into annual reinsurance treaty agreements with several other companies. The treaty agreements insure workers compensation, general liability, auto liability and FELA risk. In accordance with the agreements, BNSF IC cedes a portion of its FELA exposure through the treaty and assumes a proportionate share of the entire risk. Each year BNSF IC reviews the objectives and performance of the treaty to determine its continued participation in the treaty. The treaty agreements provide for certain protections against the risk of treaty participants’ non-performance. On an on-going basis, BNSF and/or the treaty manager reviews the credit-worthiness of each of the participants. BNSF does not believe its exposure to treaty participants’ non-performance is material at this time. BNSF IC typically invests in time deposits and money market accounts. At both June 30, 2014 and December 31, 2013, there was approximately $480 million related to these third-party investments, which were classified as cash and cash equivalents on the Company’s Consolidated Balance Sheet.

Environmental

The Company’s operations, as well as those of its competitors, are subject to extensive federal, state and local environmental regulation. BNSF’s operating procedures include practices to protect the environment from the risks inherent in railroad operations, which frequently involve transporting chemicals and other hazardous materials. Additionally, many of BNSF’s land holdings are and have been used for industrial or transportation-related purposes or leased to commercial or industrial companies whose activities may have resulted in discharges onto the property. As a result, BNSF is subject to environmental cleanup and enforcement actions. In particular, the federal Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA), also known as the Superfund law, as well as similar state laws, generally impose joint and several liability for cleanup and enforcement costs on current and former owners and operators of a site without regard to fault or the legality of the original conduct. BNSF has been notified that it is a potentially responsible party (PRP) for study and cleanup costs at Superfund sites for which investigation and remediation payments are or will be made or are yet to be determined (the Superfund sites) and, in many instances, is one of several PRPs. In addition, BNSF may be considered a PRP under certain other laws. Accordingly, under CERCLA and other federal and state statutes, BNSF may be held jointly and severally liable for all environmental costs

13

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) - (Continued)

associated with a particular site. If there are other PRPs, BNSF generally participates in the cleanup of these sites through cost-sharing agreements with terms that vary from site to site. Costs are typically allocated based on such factors as relative volumetric contribution of material, the amount of time the site was owned or operated and/or the portion of the total site owned or operated by each PRP.

BNSF is involved in a number of administrative and judicial proceedings and other mandatory cleanup efforts for 237 sites, including 16 Superfund sites, at which it is participating in the study or cleanup, or both, of alleged environmental contamination.

Liabilities for environmental cleanup costs are recorded when BNSF’s liability for environmental cleanup is probable and reasonably estimable. Subsequent adjustments to initial estimates are recorded as necessary based upon additional information developed in subsequent periods. Environmental costs include initial site surveys and environmental studies as well as costs for remediation of sites determined to be contaminated.

BNSF estimates the ultimate cost of cleanup efforts at its known environmental sites on an annual basis during the third quarter. Ultimate cost estimates for environmental sites are based on current estimated percentage to closure ratios, possible remediation workplans and estimates of the costs and likelihood of each possible outcome, historical payment patterns, and benchmark patterns developed from data accumulated from industry and public sources, including the Environmental Protection Agency and other governmental agencies. These factors incorporate into the estimates experience gained from cleanup efforts at other similar sites.

Annual studies do not include: (i) contaminated sites of which the Company is not aware; (ii) additional amounts for third-party tort claims, which arise out of contaminants allegedly migrating from BNSF property, due to a limited number of sites; or (iii) natural resource damage claims. BNSF continues to estimate third-party tort claims on a site by site basis when the liability for such claims is probable and reasonably estimable. BNSF’s recorded liability for third-party tort claims as of June 30, 2014 and December 31, 2013 was $14 million and $13 million, respectively.

On a quarterly basis, BNSF monitors actual experience against the forecasted remediation and related payments made on existing sites and conducts ongoing environmental contingency analyses, which consider a combination of factors including independent consulting reports, site visits, legal reviews and analysis of the likelihood of other PRP's participation in, and their ability to pay for, cleanup. Adjustments to the Company’s estimates will continue to be recorded as necessary based on developments in subsequent periods. Additionally, environmental accruals, which are classified as materials and other in the Consolidated Statements of Income, include amounts for newly identified sites or contaminants, third-party claims and legal fees incurred for defense of third-party claims and recovery efforts.

The following tables summarize the activity in the Company’s accrued obligations for environmental matters (in millions):

	Three Months Ended June 30,
	2014			2013
Beginning balance	$	427		$	450
Accruals	3			(1		)
Payments	(14		)	(9		)
Ending balance	$	416		$	440

	Six Months Ended June 30,
	2014			2013
Beginning balance	$	435		$	458
Accruals	5			(1		)
Payments	(24		)	(17		)
Ending balance	$	416		$	440

At June 30, 2014, $55 million was included in current liabilities.

14

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) - (Continued)

BNSF’s environmental liabilities are not discounted. BNSF anticipates that the majority of the accrued costs at June 30, 2014, will be paid over the next ten years, and no individual site is considered to be material.

Liabilities recorded for environmental costs represent BNSF’s best estimate of its probable future obligation for the remediation and settlement of these sites and include both asserted and unasserted claims. Although recorded liabilities include BNSF’s best estimate of all probable costs, without reduction for anticipated recoveries from third parties, BNSF’s total cleanup costs at these sites cannot be predicted with certainty due to various factors such as the extent of corrective actions that may be required, evolving environmental laws and regulations, advances in environmental technology, the extent of other parties’ participation in cleanup efforts, developments in ongoing environmental analyses related to sites determined to be contaminated and developments in environmental surveys and studies of contaminated sites.

Because of the uncertainty surrounding these factors, it is reasonably possible that future costs for environmental liabilities may range from approximately $310 million to $580 million. However, BNSF believes that the $416 million recorded at June 30, 2014, is the best estimate of the Company’s future obligation for environmental costs.

Although the final outcome of these environmental matters cannot be predicted with certainty, it is the opinion of BNSF that none of these items, when finally resolved, will have a material adverse effect on the Company’s financial position or liquidity. However, the occurrence of a number of these items in the same period could have a material adverse effect on the results of operations in a particular quarter or fiscal year.

Other Claims and Litigation

In addition to asbestos, other personal injury and environmental matters discussed above, BNSF and its subsidiaries are also parties to a number of other legal actions and claims, governmental proceedings and private civil suits arising in the ordinary course of business, including those related to disputes and complaints involving certain transportation rates and charges. Some of the legal proceedings include claims for punitive as well as compensatory damages, and a few proceedings purport to be class actions. Although the final outcome of these matters cannot be predicted with certainty, considering among other things the meritorious legal defenses available and liabilities that have been recorded along with applicable insurance, BNSF currently believes that none of these items, when finally resolved, will have a material adverse effect on the Company’s financial position or liquidity. However, an unexpected adverse resolution of one or more of these items could have a material adverse effect on the results of operations in a particular quarter or fiscal year.

7. Employment Benefit Plans

Components of the net cost for the periods presented below for certain employee benefit plans were as follows (in millions):

	Pension Benefits
	Three Months Ended June 30,
Net Cost	2014			2013
Service cost	$	9		$	11
Interest cost	24			23
Expected return on plan assets	(33		)	(31		)
Amortization of net loss	—			4
Net cost recognized	$	—		$	7

15

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) - (Continued)

	Pension Benefits
	Six Months Ended June 30,
Net Cost	2014			2013
Service cost	$	19		$	23
Interest cost	48			45
Expected return on plan assets	(67		)	(62		)
Amortization of net loss	—			8
Net cost recognized	$	—		$	14

	Retiree Health and Welfare Benefits
	Three Months Ended June 30,
Net Cost	2014		2013
Service cost	$	—	$	1
Interest cost	3		3
Amortization of net loss	—		1
Net cost recognized	$	3	$	5

	Retiree Health and Welfare Benefits
	Six Months Ended June 30,
Net Cost	2014			2013
Service cost	$	—		$	1
Interest cost	6			6
Amortization of prior service credits	(1		)	—
Amortization of net loss	1			2
Net cost recognized	$	6		$	9

8. Related Party Transactions

The companies identified as affiliates of BNSF include Berkshire and its subsidiaries. During the six months ended June 30, 2014 and 2013, the Company declared and paid cash distributions of $1.75 billion and $2 billion, respectively, to its parent company. For the six months ended June 30, 2014 and 2013, the Company made tax payments of $395 million and $934 million to Berkshire, and received a tax refund of $21 million and $0 million, respectively.

BNSF engages in various arm's-length transactions with affiliates in the ordinary course of business. The following tables summarize revenues earned by BNSF for services provided to affiliates and expenditures to affiliates (in millions):

	Three Months Ended June 30,
	2014		2013
Revenues	$	34	$	28
Expenditures	$	4	$	4

	Six Months Ended June 30,
	2014		2013
Revenues	$	74	$	66
Expenditures	$	10	$	10

16

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) - (Continued)

9. Comprehensive Income

Other comprehensive income refers to revenues, expenses, gains and losses that under generally accepted accounting principles are included in comprehensive income, a component of equity within the Consolidated Balance Sheets, rather than net income on the Consolidated Statements of Income. Under existing accounting standards, other comprehensive income may include, among other things, unrecognized gains and losses and prior service credit related to pension and other postretirement benefit plans and accounting for derivative financial instruments, which qualify for cash flow hedge accounting.

The following tables provide the components of accumulated other comprehensive income by component (in millions):

	Pension and Retiree Health and Welfare Benefit Itemsa			Equity Method Investments			Total
Balance at December 31, 2013	$	251		$	(6	)	$	245
Other comprehensive income before reclassifications	—			3			3
Amounts reclassified from accumulated other comprehensive income	—			—			—
Balance at June 30, 2014	$	251		$	(3	)	$	248
Balance at December 31, 2012	$	(241	)	$	(4	)	$	(245	)
Other comprehensive income before reclassifications	—			(1		)	(1		)
Amounts reclassified from accumulated other comprehensive income	6			—			6
Balance at June 30, 2013	$	(235	)	$	(5	)	$	(240	)

^a Amounts are net of tax.

Reclassifications out of Accumulated Other Comprehensive Income
	Three Months Ended June 30,
Details about Accumulated Other Comprehensive Income Components	2014			2013			Income Statement Line Item
Amortization of pension and retiree health and welfare benefit items
Actuarial losses	$	—		$	5		b
Prior service credits	—			—			b
	—			5			Total before tax
	—			(2		)	Tax expense/(benefit)
Total reclassifications for the period	$	—		$	3		Net of tax
	Six Months Ended June 30,
Details about Accumulated Other Comprehensive Income Components	2014			2013			Income Statement Line Item
Amortization of pension and retiree health and welfare benefit items
Actuarial losses	$	1		$	10		b
Prior service credits	(1		)	—			b
	—			10			Total before tax
	—			(4		)	Tax expense/(benefit)
Total reclassifications for the period	$	—		$	6		Net of tax

^b This accumulated other comprehensive income component is included in the computation of net periodic pension cost and retiree health and welfare (see Note 7 for additional details).

17

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) - (Continued)

10. Accounting Pronouncements

In January 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-01 (ASU 2014-01), Investments - Equity Method and Joint Ventures (Topic 323), Accounting for Investments in Qualified Affordable Housing Projects. This standard permits an entity to elect the proportional amortization method of accounting for limited liability investments in qualified affordable housing projects if certain criteria are met. Under the proportional amortization method, the investment is amortized in proportion to the tax benefits received and the net investment performance is reported as a component of income tax expense. ASU 2014-01 is effective for fiscal years beginning after December 15, 2014, with early adoption permitted. If elected, the proportional amortization method is required to be applied retrospectively. The Company has assessed the effects of this standard and it does not have an impact to the Consolidated Financial Statements.

In May 2014, the FASB issued Accounting Standards Update No. 2014-09 (ASU 2014-09), Revenue from Contracts with Customers (Topic 606). The guidance in ASU 2014-09 supersedes the revenue recognition requirements in Accounting Standards Codification Topic 605, Revenue Recognition. ASU 2014-09 applies to most contracts with customers. Insurance and leasing contracts are excluded from the scope. ASU 2014-09 prescribes a five step framework in accounting for revenues from contracts within its scope, including (a) identification of the contract, (b) identification of the performance obligation under the contract, (c) determination of the transaction price, (d) allocation of the transaction price to the identified performance obligation and (e) recognition of revenue as the identified performance obligation is satisfied. ASU 2014-09 also prescribes additional disclosures and financial statement presentations. ASU 2014-09 is effective for public companies in annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period, early adoption is not permitted. ASU 2014-09 may be adopted retrospectively or under a modified retrospective method where the cumulative effect is recognized at the date of initial application. The Company is currently evaluating the effect this standard will have on its Consolidated Financial Statements and will adopt the guidance and include appropriate disclosures related to revenue recognition in accordance with ASU 2014-09 in its interim report on Form 10-Q for the period ending March 31, 2017.

18

Item 2. Management’s Narrative Analysis of Results of Operations.

Management’s narrative analysis relates to the results of operations of Burlington Northern Santa Fe, LLC and its majority-owned subsidiaries (collectively BNSF, Registrant or Company). The principal operating subsidiary of BNSF is BNSF Railway Company (BNSF Railway) through which BNSF derives substantially all of its revenues. The following narrative analysis should be read in conjunction with the Consolidated Financial Statements and the accompanying notes.

The following narrative analysis of results of operations includes a comparative analysis of the six months ended June 30, 2014 and 2013.

Results of Operations

Revenues Summary

The following tables present BNSF’s revenue information by business group:

	Revenues (in millions)				Cars / Units (in thousands)
	Six Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014	2013
Consumer Products	$	3,474	$	3,390	2,481	2,430
Industrial Products	2,942		2,777		944	918
Coal	2,441		2,390		1,113	1,061
Agricultural Products	1,952		1,703		479	469
Total Freight Revenues	10,809		10,260		5,017	4,878
Other Revenues	373		346
Total Operating Revenues	$	11,182	$	10,606

	Average Revenue Per Car / Unit
	Six Months Ended June 30,
	2014		2013
Consumer Products	$	1,400	$	1,395
Industrial Products	3,117		3,025
Coal	2,193		2,253
Agricultural Products	4,075		3,631
Total Freight Revenues	$	2,154	$	2,103

Fuel Surcharges

Freight revenues include both revenue for transportation services and fuel surcharges. BNSF’s fuel surcharge program is intended to recover its incremental fuel costs when fuel prices exceed a threshold fuel price. Fuel surcharges are calculated differently depending on the type of commodity transported. BNSF has two standard fuel surcharge programs – Percent of Revenue and Mileage-Based. In addition, in certain commodities, fuel surcharge is calculated using a fuel price from a time period that can be up to 60 days earlier. In a period of volatile fuel prices or changing customer business mix, changes in fuel expense and fuel surcharge may significantly differ.

The following table presents fuel surcharge and fuel expense information (in millions):

	Six Months Ended June 30,
	2014		2013
Total fuel expense a	$	2,315	$	2,198
BNSF fuel surcharges	$	1,467	$	1,438

^a  Total fuel expense includes locomotive and non-locomotive fuel.

19

Six Months Ended June 30, 2014 vs. the Six Months Ended June 30, 2013

Revenues

Revenues for the six months ended June 30, 2014, were $11,182 million, an increase of $576 million, or 5 percent as compared with the six months ended June 30, 2013. The increase in revenues is due to the following changes in revenues:

▪ Average revenue per car / unit increased primarily as a result of increased rate per car / unit.

In addition to an increase in average revenue per car / unit, the following changes in volumes also impacted the change in revenues:

▪ Consumer Products unit volumes increased primarily due to higher international intermodal traffic.

▪ Industrial Products unit volumes increased primarily due to expanded shipments of petroleum products, driven mainly by increased crude unit train loadings.

▪ Coal unit volumes increased primarily due to higher demand.

▪ Agricultural Products unit volumes increased due to heightened customer demand following a record grain harvest in late 2013.

Expenses

Operating expenses for the six months ended June 30, 2014, were $8,134 million, an increase of $573 million, or 8 percent, as compared with the six months ended June 30, 2013. A significant portion of this increase is due to the following changes in expenses, which includes increased costs related to severe weather issues and service-related challenges:

▪ Compensation and benefits expense increased primarily due to higher unit volumes and average headcount, as well as higher overtime, training and wage inflation.

▪ Fuel expense increased due to higher volumes and lower efficiency, partially offset by lower average fuel prices.

▪ Depreciation and amortization expense increased due to additional assets in service.

▪ Materials and other expense increased primarily as a result of higher crew transportation, lodging and other travel costs, utilities and locomotive materials.

▪ There were no significant changes in purchased services expense and equipment rents expense.

▪ Interest expense increased primarily due to a higher average debt balance.

▪ The effective tax rate was 37.9 percent and 37.4 percent for the six months ended June 30, 2014 and 2013, respectively. The 2013 effective tax rate includes favorable state law tax changes.

20

Forward-Looking Information

To the extent that statements made by the Company relate to the Company’s future economic performance or business outlook, projections or expectations of financial or operational results, or refer to matters that are not historical facts, such statements are “forward-looking” statements within the meaning of the federal securities laws.

Forward-looking statements involve a number of risks and uncertainties, and actual performance or results may differ materially. For a discussion of material risks and uncertainties that the Company faces, see the discussion in Item 1A, “Risk Factors,” of the Company’s Annual Report on Form 10-K. Important factors that could cause actual results to differ materially include, but are not limited to, the following:

•  Economic and industry conditions: material adverse changes in economic or industry conditions, both in the United States and globally; volatility in the capital or credit markets including changes affecting the timely availability and cost of capital; changes in customer demand, effects of adverse economic conditions affecting shippers or BNSF’s supplier base, and effects due to more stringent regulatory policies such as the regulation of carbon dioxide emissions that could reduce the demand for coal or governmental tariffs or subsidies that could affect the demand for grain, the impact of low natural gas prices on coal demand for electric power plants, changes in environmental laws and other laws and regulations that could affect the demand for drilling products and products produced by drilling, changes in fuel prices and other key material prices, the impact of high barriers of entry for prospective new suppliers and disruptions in supply chains for these materials; competition and consolidation within the transportation industry; and changes in crew availability, labor and benefits costs and labor difficulties, including stoppages affecting either BNSF’s operations or customers’ abilities to deliver goods to BNSF for shipment.

•   Legal, legislative and regulatory factors: developments and changes in laws and regulations, including those affecting train operations or the marketing of services; the ultimate outcome of shipper and rate claims subject to adjudication; claims, investigations or litigation alleging violations of the antitrust laws; increased economic regulation of the rail industry through legislative action and revised rules and standards applied by the U.S. Surface Transportation Board in various areas including rates and services; developments in environmental investigations or proceedings with respect to rail operations or current or past ownership or control of real property or properties owned by others impacted by BNSF operations; losses resulting from claims and litigation relating to personal injuries, asbestos and other occupational diseases; the release of hazardous materials, environmental contamination and damage to property; regulation, restrictions or caps, or other controls of diesel emissions that could affect operations or increase costs; the availability of adequate insurance to cover the risks associated with operations.

•   Operatingfactors: changes in operating conditions and costs; operational and other difficulties in implementing positive train control technology, including increased compliance or operational costs or penalties; restrictions on development and expansion plans due to environmental concerns; disruptions to BNSF's technology network including computer systems and software, such as cybersecurity intrusions, misappropriation of assets or sensitive information, corruption of data or operations disruptions; as well as natural events such as severe weather, fires, floods and earthquakes or man-made or other disruptions of BNSF Railway’s or other railroads’ operating systems, structures, or equipment including the effects of acts of terrorism on the Company’s system or other railroads’ systems or other links in the transportation chain.

The Company cautions against placing undue reliance on forward-looking statements, which reflect its current beliefs and are based on information currently available to it as of the date a forward-looking statement is made. The Company undertakes no obligation to revise forward-looking statements to reflect future events, changes in circumstances, or changes in beliefs. In the event the Company does update any forward-looking statement, no inference should be made that the Company will make additional updates with respect to that statement, related matters, or any other forward-looking statements.

21

Item 4. Controls and Procedures.

Based on their evaluation as of the end of the period covered by this quarterly report on Form 10-Q, BNSF’s principal executive officer and principal financial officer have concluded that BNSF’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934) are effective to ensure that information required to be disclosed by BNSF in the reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized, and reported within the time periods specified in Securities and Exchange Commission rules and forms and that such information is accumulated and communicated to BNSF’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Additionally, as of the end of the period covered by this report, BNSF's principal executive officer and principal financial officer have concluded that there have been no changes in BNSF's internal control over financial reporting that occurred during BNSF’s second fiscal quarter that have materially affected, or are reasonably likely to materially affect, BNSF's internal control over financial reporting.

22

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

PART II OTHER INFORMATION

Item 6. Exhibits.

See Index to Exhibits on page E-1 for a description of the exhibits filed as part of this report.

23

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

BURLINGTON NORTHERN SANTA FE, LLC (Registrant)
By:	/s/    Julie A. Piggott
	Julie A. Piggott Executive Vice President and Chief Financial Officer (On behalf of the Registrant and as principal financial officer)

Date:  August 1, 2014

S-1

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

Exhibit Index

		Incorporated by Reference (if applicable)
	Exhibit Number and Description	Form	File Date	File No.	Exhibit
3.1	Certificate of Formation dated November 2, 2009.	8-K	2/16/2010	001-11535	3.1
3.2	Amended and Restated Limited Liability Company Operating Agreement of Burlington Northern Santa Fe, LLC, dated as of February 12, 2010.	8-K	2/16/2010	001-11535	3.2
3.3	Written Consent of sole member of Burlington Northern Santa Fe, LLC, dated April 8, 2010, amending and restating certain sections of the Amended and Restated Limited Liability Company Operating Agreement of Burlington Northern Santa Fe, LLC dated as of February 12, 2010.	8-K	4/14/2010	001-11535	3.2
4.1	Fourteenth Supplemental Indenture, dated as of March 7, 2014, to Indenture dated as of December 1, 1995, between Burlington Northern Santa Fe, LLC and The Bank of New York Mellon Trust Company, N.A., as Trustee.	8-K	3/7/2014	001-11535	4.1
4.2	Certificate of Determination as to the terms of BNSF’s 3.750% Debentures due April 1, 2024 and 4.900% Debentures due April 1, 2044.	8-K	3/7/2014	001-11535	4.2
12.1	Computation of Ratio of Earnings to Fixed Charges.*
31.1	Principal Executive Officer’s Certifications Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
31.2	Principal Financial Officer’s Certifications Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
32.1	Certification Pursuant to 18 U.S.C. § 1350 (Section 906 of the Sarbanes-Oxley Act of 2002).*
101	eXtensible Business Reporting Language (XBRL) documents submitted electronically: 101.INS - XBRL Instance Document 101.SCH - XBRL Taxonomy Extension Schema Document 101.CAL - XBRL Extension Calculation Linkable Document 101.DEF - XBRL Taxonomy Extension Definition Linkable Document 101.LAB - XBRL Taxonomy Extension Label Linkbase 101.PRE - XBRL Taxonomy Extension Presentation Linkbase Document
	The following unaudited information from the Burlington Northern Santa Fe, LLC Form 10-Q for the three and six months ended June 30, 2014, formatted in XBRL includes: (i) the Consolidated Statements of Income for the three and six months ended June 30, 2014 and 2013, (ii) the Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2014 and 2013, (iii) the Consolidated Balance Sheets as of June 30, 2014 and December 31, 2013, (iv) the Consolidated Statements of Cash Flows for the six months ended June 30, 2014 and 2013, (v) the Consolidated Statements of Changes in Equity as of June 30, 2014, and (vi) the Notes to the Consolidated Financial Statements. *

Certain instruments defining the rights of the holders of long-term debt of the Company and of its subsidiaries, involving a total

amount of indebtedness not in excess of 10 percent of the total assets of the Company and its subsidiaries on a consolidated basis,

have not been filed as exhibits. The Company hereby agrees to furnish a copy of any of these agreements to the SEC upon request.

__________________

* Filed herewith

E-1

EX-12.1

Exhibit 12.1

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

(In millions, except ratio amounts)

(Unaudited)

		Six Months Ended June 30,
		2014		2013
Earnings:
Income before income taxes	$	2,641	$	2,686
Add:
Interest and other fixed charges, excluding capitalized interest		402		355
Reasonable approximation of portion of rent under long-term operating           leases representative of an interest factor		96		96
Distributed income of investees accounted for under the equity method		4		3
Amortization of capitalized interest		1		1
Less:
Equity in earnings of investments accounted for under the equity method		7		5
Total earnings available for fixed charges	$	3,137	$	3,136
Fixed charges:
Interest and fixed charges	$	415	$	370
Reasonable approximation of portion of rent under long-term operating leases    representative of an interest factor		96		96
Total fixed charges	$	511	$	466
Ratio of earnings to fixed charges		6.14x		6.73x

E-2

EX-31.1

Exhibit 31.1

Principal Executive Officer's Certifications

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Matthew K. Rose, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Burlington Northern Santa Fe, LLC;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods covered by this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 1, 2014

/s/ Matthew K. Rose

Matthew K. Rose

Chairman and

Chief Executive Officer

E-3

EX-31.2

Exhibit 31.2

Principal Financial Officer's Certifications

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Julie A. Piggott, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Burlington Northern Santa Fe, LLC;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods covered by this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 1, 2014

/s/ Julie A. Piggott

Julie A. Piggott

Executive Vice President and

Chief Financial Officer

E-4

EX-32.1

Exhibit 32.1

Certification Pursuant to 18 U.S.C. § 1350

(Section 906 of the Sarbanes-Oxley Act of 2002)

Burlington Northern Santa Fe, LLC

In connection with the Quarterly Report of Burlington Northern Santa Fe, LLC (the "Company") on Form 10-Q for the period ended June 30, 2014, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), the undersigned, Matthew K. Rose, Chairman and Chief Executive Officer of the Company, and Julie A. Piggott, Executive Vice President and Chief Financial Officer of the Company, each hereby certifies that, to his and her knowledge on the date hereof:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 1, 2014

/s/ Matthew K. Rose	/s/ Julie A. Piggott
Matthew K. Rose	Julie A. Piggott
Chairman and Chief Executive Officer	Executive Vice President and Chief Financial Officer

A signed original of this written statement required by Section 906 has been provided to Burlington Northern Santa Fe, LLC and will be retained by Burlington Northern Santa Fe, LLC and furnished to the Securities and Exchange Commission or its staff upon request.

E-5

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Commitments and Contingencies - Personal Injury (Details) (USD $) In Millions, unless otherwise specified					6 Months Ended	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013	Dec. 31, 2012	Jun. 30, 2014 Unasserted Claim	Jun. 30, 2014 Personal Injury	Jun. 30, 2013 Personal Injury	Jun. 30, 2014 Personal Injury	Jun. 30, 2013 Personal Injury	Jun. 30, 2014 Bank Time Deposits and Money Market Funds BNSF Insurance Company	Dec. 31, 2013 Bank Time Deposits and Money Market Funds BNSF Insurance Company	Jun. 30, 2014 Current Liabilities [Member]
Asbestos and Personal Injury [Abstract]
Percent of future unasserted asbestos claims to be filed within the next ten years					60.00%
Percent of future unasserted asbestos claims to be filed within the next fifteen years					80.00%
Percent of future unasserted asbestos claims to be filed within the next twenty-five years					95.00%
Length in years for 60 percent of future unasserted asbestos claims to be filed					10 years
Length in years for 80 percent of future unasserted asbestos claims to be filed					15 years
Length in years for 95 percent of future unasserted asbestos claims to be filed					25 years
Accrued obligations for asbestos and other personal injury matters, current liabilities												$ 85
Future costs to settle personal injury claims, minimum						340		340
Future costs to settle personal injury claims, maximum						455		455
Loss Contingency Accrual [Roll Forward]
Beginning balance						386	453	387	462
Accruals						18	29	36	55
Payments						(19)	(15)	(38)	(50)
Ending balance						385	467	385	467
Cash and Cash Equivalents [Abstract]
Cash and cash equivalents	$ 1,926	$ 2,225	$ 1,672	$ 1,794						$ 480	$ 480

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Comprehensive Income (Tables)

6 Months Ended

Jun. 30, 2014

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Schedule of Accumulated Other Comprehensive Income (Loss)

The following tables provide the components of accumulated other comprehensive income by component (in millions):

	Pension and Retiree Health and Welfare Benefit Itemsa			Equity Method Investments			Total
Balance at December 31, 2013	$	251		$	(6	)	$	245
Other comprehensive income before reclassifications	—			3			3
Amounts reclassified from accumulated other comprehensive income	—			—			—
Balance at June 30, 2014	$	251		$	(3	)	$	248
Balance at December 31, 2012	$	(241	)	$	(4	)	$	(245	)
Other comprehensive income before reclassifications	—			(1		)	(1		)
Amounts reclassified from accumulated other comprehensive income	6			—			6
Balance at June 30, 2013	$	(235	)	$	(5	)	$	(240	)

^a Amounts are net of tax.

Reclassification out of Accumulated Other Comprehensive Income [Table Text Block]

Reclassifications out of Accumulated Other Comprehensive Income
	Three Months Ended June 30,
Details about Accumulated Other Comprehensive Income Components	2014			2013			Income Statement Line Item
Amortization of pension and retiree health and welfare benefit items
Actuarial losses	$	—		$	5		b
Prior service credits	—			—			b
	—			5			Total before tax
	—			(2		)	Tax expense/(benefit)
Total reclassifications for the period	$	—		$	3		Net of tax
	Six Months Ended June 30,
Details about Accumulated Other Comprehensive Income Components	2014			2013			Income Statement Line Item
Amortization of pension and retiree health and welfare benefit items
Actuarial losses	$	1		$	10		b
Prior service credits	(1		)	—			b
	—			10			Total before tax
	—			(4		)	Tax expense/(benefit)
Total reclassifications for the period	$	—		$	6		Net of tax

^b This accumulated other comprehensive income component is included in the computation of net periodic pension cost and retiree health and welfare (see Note 7 for additional details).

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Accumulated Other Comprehensive Income by Component (Details) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Jun. 30, 2014		Jun. 30, 2013
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Accumulated Other Comprehensive Income (Loss), Beginning balance	$ 245		$ (245)
Other Comprehensive Income (Loss) before Reclassifications	3		(1)
Amounts reclassified from accumulated other comprehensive income (loss)	0		6
Accumulated Other Comprehensive Income (Loss), Ending balance	248		(240)
Equity Method Investments [Member]
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Accumulated Other Comprehensive Income (Loss), Beginning balance	(6)		(4)
Other Comprehensive Income (Loss) before Reclassifications	3		(1)
Amounts reclassified from accumulated other comprehensive income (loss)	0		0
Accumulated Other Comprehensive Income (Loss), Ending balance	(3)		(5)
Accumulated Defined Benefit Plans Adjustment [Member]
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Accumulated Other Comprehensive Income (Loss), Beginning balance	251	[1]	(241)	[1]
Other Comprehensive Income (Loss) before Reclassifications	0	[1]	0	[1]
Amounts reclassified from accumulated other comprehensive income (loss)	0	[1]	6	[1]
Accumulated Other Comprehensive Income (Loss), Ending balance	$ 251	[1]	$ (235)	[1]

[1] Amounts are net of tax.

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Accounting Policies and Interim Results

6 Months Ended

Jun. 30, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Accounting Policies and Interim Results

Accounting Policies and Interim Results

The Consolidated Financial Statements should be read in conjunction with Burlington Northern Santa Fe, LLC’s Annual Report on Form 10-K for the year ended December 31, 2013, including the financial statements and notes thereto. Burlington Northern Santa Fe, LLC (BNSF) is a holding company that conducts no operating activities and owns no significant assets other than through its interests in its subsidiaries. The Consolidated Financial Statements include the accounts of BNSF and its majority-owned subsidiaries, all of which are separate legal entities (collectively, the Company). BNSF’s principal operating subsidiary is BNSF Railway Company (BNSF Railway). All intercompany accounts and transactions have been eliminated.

On February 12, 2010, Berkshire Hathaway Inc., a Delaware corporation (Berkshire), acquired 100% of the outstanding shares of Burlington Northern Santa Fe Corporation common stock that it did not already own. The acquisition was completed through the merger (Merger) of a Berkshire wholly-owned merger subsidiary and Burlington Northern Santa Fe Corporation with the surviving entity renamed Burlington Northern Santa Fe, LLC. Earnings per share data has not been presented because BNSF has not issued stock or membership interests to the public.

The results of operations for any interim period are not necessarily indicative of the results of operations to be expected for the entire year. In the opinion of management, the unaudited financial statements reflect all adjustments (consisting of only normal recurring adjustments, except as disclosed) necessary for a fair statement of BNSF’s consolidated financial position as of June 30, 2014, and the results of operations for the three and six months ended June 30, 2014 and 2013.

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Other Assets (Details) (USD $) In Millions, unless otherwise specified	1 Months Ended
	Jul. 31, 2010	Jun. 30, 2014
Variable Interest Entity [Line Items]
Unconsolidated Partnership, assets		$ 375
Variable Interest Entity, Not Primary Beneficiary
Variable Interest Entity [Line Items]
Company limited partner holding interest, percentage	99.90%
Unamortized investment balance classified as Other Assets		345
Remaining commitments classified as Other Liabilities		18
Maximum exposure to loss		345
Remaining commitments expected to be paid in 2014		$ 18
Variable Interest Entity, Primary Beneficiary
Variable Interest Entity [Line Items]
General partner holding interest, percentage	0.10%

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Other Intangible Assets and Liabilities (Details) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013
Finite-Lived Intangible Assets [Line Items]
Amortized intangible assets, gross carrying amount	$ 2,030		$ 2,030
Amortized intangible assets, accumulated amortization	1,364		1,209
Amortized intangible liabilities, gross carrying amount	2,056		2,056
Amortized intangible liabilities, accumulated amortization	1,184		1,095
Amortization of Intangible Assets	155	153
Amortization of Intangible Liabilities	89	127
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract]
Amortization of intangible assets, Remainder of 2014	155
Amortization of intangible liabilities, Remainder of 2014	90
Amortization of intangible assets, 2015	56
Amortization of intangible liabilities, 2015	115
Amortization of intangible assets, 2016	33
Amortization of intangible liabilities, 2016	101
Amortization of intangible assets, 2017	33
Amortization of intangible liabilities, 2017	96
Amortization of intangible assets, 2018	31
Amortization of intangible liabilities, 2018	$ 90

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Debt Notes and Debentures (Details) (USD $)					1 Months Ended
	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2014 Corporate Debt Securities Three Point Seven Five Zero Percent Debentures Due April 1, 2024 [Member]	Jun. 30, 2014 Corporate Debt Securities Four Point Nine Zero Zero Percent Debentures Due April 1, 2044 [Member]	Apr. 30, 2014 SEC Debt Shelf Registration	Jun. 30, 2014 SEC Debt Shelf Registration	Jun. 30, 2014 Junior Subordinated Debt
Debt Instrument [Line Items]
Additional Debt Securities Authorized For Issuance By The Board of Managers					$ 3,000,000,000
Debentures issued amount			500,000,000	1,000,000,000
Debentures interest rate			3.75%	4.90%
Remaining amount of debt securities that may be issued						3,250,000,000
Subordinated notes related to financial covenants							500,000,000
Debt, fair value	18,563,000,000	16,507,000,000
Debt, book value	$ 17,004,000,000	$ 16,066,000,000

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Debt Guarantees (Details) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Jun. 30, 2014
Kinder Morgan Energy Partners, L.P. | Payment Guarantee
Guarantor Obligations [Line Items]
BNSF Ownership Percentage	0.50%
Principal Amount Guaranteed	$ 190
Maximum Future Payments	190
Maximum Recourse Amount	0	[1]
Capitalized Obligations	2	[2]
Chevron Phillips Chemical Company, LP | Indemnification Agreement
Guarantor Obligations [Line Items]
BNSF Ownership Percentage	0.00%
Remaining Term (in years)	3 years
Capitalized Obligations	$ 5	[3]

[1] Reflects the maximum amount the Company could recover from a third party other than the counterparty.

[2] Reflects capitalized obligations that are recorded on the Company’s Consolidated Balance Sheet.

[3] Reflects the asset and corresponding liability for the fair value of these guarantees required by authoritative accounting guidance related to guarantees.

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Consolidated Statements of Changes in Equity (USD $) In Millions, unless otherwise specified	Total	Members Equity	Accumulated Other Comprehensive Income (Loss)
Balance at Dec. 31, 2013	$ 34,612	$ 34,367	$ 245
Increase (Decrease) in Member's Equity [Roll Forward]
Cash distributions to Parent	(1,750)	(1,750)	0
Comprehensive income, net of tax	1,643	1,640	3
Balance at Jun. 30, 2014	$ 34,505	$ 34,257	$ 248

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Debt Variable Interest Entities - Leases (Details) (Variable Interest Entity, Not Primary Beneficiary, Reporting Entity, Equipment, USD $) In Billions, unless otherwise specified	Jun. 30, 2014
Variable Interest Entity, Not Primary Beneficiary | Reporting Entity | Equipment
Operating Leased Assets [Line Items]
Future minimum lease payments	$ 3

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Consolidated Statements of Income (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Revenues	$ 5,735	$ 5,322	$ 11,182	$ 10,606
Operating expenses:
Compensation and benefits	1,234	1,128	2,452	2,267
Fuel	1,156	1,076	2,315	2,198
Purchased services	634	617	1,287	1,234
Depreciation and amortization	523	489	1,038	972
Equipment rents	225	205	440	403
Materials and other	283	230	602	487
Total operating expenses	4,055	3,745	8,134	7,561
Operating income	1,680	1,577	3,048	3,045
Interest expense	206	177	402	355
Other expense, net	2	3	5	4
Total before tax	1,472	1,397	2,641	2,686
Income tax expense	556	513	1,001	1,004
Net income	$ 916	$ 884	$ 1,640	$ 1,682

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Consolidated Balance Sheets (Unaudited) (Parenthetical) (USD $) In Millions, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
ASSETS
Accumulated depreciation	$ 2,904	$ 2,232

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Employment Benefit Plans (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Pension Plans, Defined Benefit
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 9	$ 11	$ 19	$ 23
Interest Cost	24	23	48	45
Expected return on plan assets	(33)	(31)	(67)	(62)
Amortization of net loss	0	4	0	8
Net cost recognized	0	7	0	14
Retiree Health and Welfare Benefits
Defined Benefit Plan Disclosure [Line Items]
Service cost	0	1	0	1
Interest Cost	3	3	6	6
Amortization of Prior Service Credits			(1)	0
Amortization of net loss	0	1	1	2
Net cost recognized	$ 3	$ 5	$ 6	$ 9

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Commitments and Contingencies (Tables)

6 Months Ended

Jun. 30, 2014

Commitments and Contingencies Disclosure [Abstract]

Schedule of Loss Contingencies by Contingency

The following tables summarize the activity in the Company’s accrued obligations for asbestos and other personal injury matters (in millions):

	Three Months Ended June 30,
	2014			2013
Beginning balance	$	386		$	453
Accruals	18			29
Payments	(19		)	(15		)
Ending balance	$	385		$	467

	Six Months Ended June 30,
	2014			2013
Beginning balance	$	387		$	462
Accruals	36			55
Payments	(38		)	(50		)
Ending balance	$	385		$	467

Accrued Obligations for Environmental Matters

The following tables summarize the activity in the Company’s accrued obligations for environmental matters (in millions):

	Three Months Ended June 30,
	2014			2013
Beginning balance	$	427		$	450
Accruals	3			(1		)
Payments	(14		)	(9		)
Ending balance	$	416		$	440

	Six Months Ended June 30,
	2014			2013
Beginning balance	$	435		$	458
Accruals	5			(1		)
Payments	(24		)	(17		)
Ending balance	$	416		$	440

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Related Party Transactions (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Related Party Transaction [Line Items]
Cash distributions			$ 1,750	$ 2,000
Related Party Transaction Revenue with Affiliates	34	28	74	66
Related Party Transaction Expenditures From Transactions With Affiliates	4	4	10	10
Parent Company
Related Party Transaction [Line Items]
Cash distributions			1,750	2,000
Tax payments to parent company			395	934
Tax Refund from Parent Company			$ 21	$ 0

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Related Party Transactions (Tables)

6 Months Ended

Jun. 30, 2014

Related Party Transaction [Line Items]

Schedule of Related Party Transactions [Table Text Block]

BNSF engages in various arm's-length transactions with affiliates in the ordinary course of business. The following tables summarize revenues earned by BNSF for services provided to affiliates and expenditures to affiliates (in millions):

	Three Months Ended June 30,
	2014		2013
Revenues	$	34	$	28
Expenditures	$	4	$	4

	Six Months Ended June 30,
	2014		2013
Revenues	$	74	$	66
Expenditures	$	10	$	10

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Consolidated Statements of Cash Flows (USD $) In Millions, unless otherwise specified	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
OPERATING ACTIVITIES
Net income	$ 1,640	$ 1,682
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	1,038	972
Deferred income taxes	77	295
Long-term casualty and environmental liabilities, net	(21)	(13)
Contribution to defined benefit pension plan	0	(25)
Other, net	(242)	(90)
Changes in current assets and liabilities:
Accounts receivable, net	(23)	(111)
Materials and supplies	(31)	(5)
Other current assets	(97)	(112)
Accounts payable and other current liabilities	411	(422)
Net cash provided by operating activities	2,752	2,171
INVESTING ACTIVITIES
Capital expenditures excluding equipment	(1,529)	(1,304)
Acquisition of equipment	(628)	(369)
Other, net	(40)	3
Net cash used for investing activities	(2,197)	(1,670)
FINANCING ACTIVITIES
Proceeds from issuance of long-term debt	1,500	1,500
Payments on long-term debt	(589)	(111)
Cash distributions	(1,750)	(2,000)
Other, net	(15)	(12)
Net cash used for financing activities	(854)	(623)
Decrease in cash and cash equivalents	(299)	(122)
Cash and cash equivalents:
Beginning of period	2,225	1,794
End of period	1,926	1,672
SUPPLEMENTAL CASH FLOW INFORMATION
Interest paid, net of amounts capitalized	425	375
Capital investments accrued but not yet paid	196	147
Income taxes paid, net of refunds	$ 496	$ 1,042

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Consolidated Statements of Comprehensive Income (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Net income	$ 916	$ 884	$ 1,640	$ 1,682
Other comprehensive income:
Change in amortization of accumulated actuarial losses and prior service credits, net of tax benefit of $0 million, $2 million, $0 million and $4 million, respectively	0	3	0	6
Change in accumulated other comprehensive income of equity method investees	0	1	3	(1)
Other Comprehensive Income (Loss), Net of Tax	0	4	3	5
Total comprehensive income	916	888	1,643	1,687
Accumulated Other Comprehensive Income (Loss)
Other comprehensive income:
Total comprehensive income			$ 3

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Comprehensive Income

6 Months Ended

Jun. 30, 2014

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Comprehensive Income

Comprehensive Income

Other comprehensive income refers to revenues, expenses, gains and losses that under generally accepted accounting principles are included in comprehensive income, a component of equity within the Consolidated Balance Sheets, rather than net income on the Consolidated Statements of Income. Under existing accounting standards, other comprehensive income may include, among other things, unrecognized gains and losses and prior service credit related to pension and other postretirement benefit plans and accounting for derivative financial instruments, which qualify for cash flow hedge accounting.

The following tables provide the components of accumulated other comprehensive income by component (in millions):

	Pension and Retiree Health and Welfare Benefit Itemsa			Equity Method Investments			Total
Balance at December 31, 2013	$	251		$	(6	)	$	245
Other comprehensive income before reclassifications	—			3			3
Amounts reclassified from accumulated other comprehensive income	—			—			—
Balance at June 30, 2014	$	251		$	(3	)	$	248
Balance at December 31, 2012	$	(241	)	$	(4	)	$	(245	)
Other comprehensive income before reclassifications	—			(1		)	(1		)
Amounts reclassified from accumulated other comprehensive income	6			—			6
Balance at June 30, 2013	$	(235	)	$	(5	)	$	(240	)

^a Amounts are net of tax.

Reclassifications out of Accumulated Other Comprehensive Income
	Three Months Ended June 30,
Details about Accumulated Other Comprehensive Income Components	2014			2013			Income Statement Line Item
Amortization of pension and retiree health and welfare benefit items
Actuarial losses	$	—		$	5		b
Prior service credits	—			—			b
	—			5			Total before tax
	—			(2		)	Tax expense/(benefit)
Total reclassifications for the period	$	—		$	3		Net of tax
	Six Months Ended June 30,
Details about Accumulated Other Comprehensive Income Components	2014			2013			Income Statement Line Item
Amortization of pension and retiree health and welfare benefit items
Actuarial losses	$	1		$	10		b
Prior service credits	(1		)	—			b
	—			10			Total before tax
	—			(4		)	Tax expense/(benefit)
Total reclassifications for the period	$	—		$	6		Net of tax

^b This accumulated other comprehensive income component is included in the computation of net periodic pension cost and retiree health and welfare (see Note 7 for additional details).

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Document and Entity Information	6 Months Ended
	Jun. 30, 2014	Aug. 01, 2014
Entity Information [Line Items]
Entity Registrant Name	BURLINGTON NORTHERN SANTA FE, LLC
Entity Central Index Key	0000934612
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Document Type	10-Q
Document Period End Date	Jun. 30, 2014
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q2
Amendment Flag	false
Entity Common Stock, Shares Outstanding		0
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes

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Accounting Pronouncements

6 Months Ended

Jun. 30, 2014

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

Accounting Pronouncements

Accounting Pronouncements

In January 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-01 (ASU 2014-01), Investments - Equity Method and Joint Ventures (Topic 323), Accounting for Investments in Qualified Affordable Housing Projects. This standard permits an entity to elect the proportional amortization method of accounting for limited liability investments in qualified affordable housing projects if certain criteria are met. Under the proportional amortization method, the investment is amortized in proportion to the tax benefits received and the net investment performance is reported as a component of income tax expense. ASU 2014-01 is effective for fiscal years beginning after December 15, 2014, with early adoption permitted. If elected, the proportional amortization method is required to be applied retrospectively. The Company has assessed the effects of this standard and it does not have an impact to the Consolidated Financial Statements.

In May 2014, the FASB issued Accounting Standards Update No. 2014-09 (ASU 2014-09), Revenue from Contracts with Customers (Topic 606). The guidance in ASU 2014-09 supersedes the revenue recognition requirements in Accounting Standards Codification Topic 605, Revenue Recognition. ASU 2014-09 applies to most contracts with customers. Insurance and leasing contracts are excluded from the scope. ASU 2014-09 prescribes a five step framework in accounting for revenues from contracts within its scope, including (a) identification of the contract, (b) identification of the performance obligation under the contract, (c) determination of the transaction price, (d) allocation of the transaction price to the identified performance obligation and (e) recognition of revenue as the identified performance obligation is satisfied. ASU 2014-09 also prescribes additional disclosures and financial statement presentations. ASU 2014-09 is effective for public companies in annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period, early adoption is not permitted. ASU 2014-09 may be adopted retrospectively or under a modified retrospective method where the cumulative effect is recognized at the date of initial application. The Company is currently evaluating the effect this standard will have on its Consolidated Financial Statements and will adopt the guidance and include appropriate disclosures related to revenue recognition in accordance with ASU 2014-09 in its interim report on Form 10-Q for the period ending March 31, 2017.

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Consolidated Statements of Comprehensive Income (Unaudited) (Parenthetical) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Change in amortization of accumulated actuarial losses and prior service costs, net of tax benefit	$ 0	$ (2)	$ 0	$ (4)

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Other Assets

6 Months Ended

Jun. 30, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Other Assets

Other Assets

In July 2010, the Company entered into a low-income housing partnership (the Partnership) as the limited partner, holding a 99.9% interest in the Partnership. The Partnership is a variable interest entity (VIE), with the purpose of developing and operating low-income housing rental properties. Recovery of the Company’s investment is accomplished through the utilization of low-income housing tax credits and the tax benefits of Partnership losses. The general partner, who holds a 0.1% interest in the Partnership, is an unrelated third party and is responsible for controlling and managing the business and financial operation of the Partnership. As the Company does not have the power to direct the activities that most significantly impact the Partnership’s economic performance, the Company is not the primary beneficiary and therefore, does not consolidate the Partnership. As of June 30, 2014, the assets of the unconsolidated Partnership totaled approximately $375 million. The Company does not provide financial support to the Partnership that it was not previously contractually obligated to provide.    

The Company has accounted for its investment in the Partnership using the effective yield method. The risk of loss of the Company's investment in the Partnership is considered low as an affiliate of the general partner has provided certain guarantees of tax credits and minimum annual returns. The Company’s maximum exposure to loss related to the Partnership is the unamortized investment balance. The following table provides information as of June 30, 2014 (in millions):

Unamortized investment balance classified as Other Assets		Remaining commitments classified as Other Liabilities		Maximum exposure to loss
$	345	$	18	$	345

The remaining commitment of $18 million is expected to be paid in 2014.

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Other Intangible Assets and Liabilities

6 Months Ended

Jun. 30, 2014

Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract]

Other Intangible Assets and Liabilities

Other Intangible Assets and Liabilities

Intangible assets and liabilities were as follows (in millions):

	As of June 30, 2014				As of December 31, 2013
	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Intangible assets	$	2,030	$	1,364	$	2,030	$	1,209
Intangible liabilities	$	2,056	$	1,184	$	2,056	$	1,095

Intangible assets primarily consisted of internally developed software and franchise and customer assets. Intangible liabilities primarily consisted of customer and shortline contracts which were in an unfavorable position at the date of Merger.

Amortizable intangible assets and liabilities are amortized based on the estimated pattern in which the economic benefits are expected to be consumed or on a straight-line basis over their estimated economic lives.

Amortization of intangible assets and liabilities was as follows (in millions):

	Six Months Ended June 30,
	2014		2013
Amortization of intangible assets	$	155	$	153
Amortization of intangible liabilities	$	89	$	127

Amortization of intangible assets and liabilities for the next five years is expected to approximate the following (in millions):

	Amortization of intangible assets		Amortization of intangible liabilities
Remainder of 2014	$	155	$	90
2015	$	56	$	115
2016	$	33	$	101
2017	$	33	$	96
2018	$	31	$	90

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Employment Benefit Plans (Tables)

6 Months Ended

Jun. 30, 2014

Pension Plans, Defined Benefit

Defined Benefit Plan Disclosure [Line Items]

Schedule of Net Benefit Costs

Components of the net cost for the periods presented below for certain employee benefit plans were as follows (in millions):

	Pension Benefits
	Three Months Ended June 30,
Net Cost	2014			2013
Service cost	$	9		$	11
Interest cost	24			23
Expected return on plan assets	(33		)	(31		)
Amortization of net loss	—			4
Net cost recognized	$	—		$	7

	Pension Benefits
	Six Months Ended June 30,
Net Cost	2014			2013
Service cost	$	19		$	23
Interest cost	48			45
Expected return on plan assets	(67		)	(62		)
Amortization of net loss	—			8
Net cost recognized	$	—		$	14

Retiree Health and Welfare Benefits

Defined Benefit Plan Disclosure [Line Items]

Schedule of Net Benefit Costs

	Retiree Health and Welfare Benefits
	Three Months Ended June 30,
Net Cost	2014		2013
Service cost	$	—	$	1
Interest cost	3		3
Amortization of net loss	—		1
Net cost recognized	$	3	$	5

	Retiree Health and Welfare Benefits
	Six Months Ended June 30,
Net Cost	2014			2013
Service cost	$	—		$	1
Interest cost	6			6
Amortization of prior service credits	(1		)	—
Amortization of net loss	1			2
Net cost recognized	$	6		$	9

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Other Intangible Assets and Liabilities (Tables)

6 Months Ended

Jun. 30, 2014

Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract]

Schedule of Finite-Lived Intangible Assets and Liabilities

Intangible assets and liabilities were as follows (in millions):

	As of June 30, 2014				As of December 31, 2013
	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Intangible assets	$	2,030	$	1,364	$	2,030	$	1,209
Intangible liabilities	$	2,056	$	1,184	$	2,056	$	1,095

Schedule of Finite-Lived Intangible Assets and Liabilities Amortization Expense

Amortization of intangible assets and liabilities was as follows (in millions):

	Six Months Ended June 30,
	2014		2013
Amortization of intangible assets	$	155	$	153
Amortization of intangible liabilities	$	89	$	127

Schedule of Finite-Lived Intangible Assets and Liabilities, Future Amortization Expense

Amortization of intangible assets and liabilities for the next five years is expected to approximate the following (in millions):

	Amortization of intangible assets		Amortization of intangible liabilities
Remainder of 2014	$	155	$	90
2015	$	56	$	115
2016	$	33	$	101
2017	$	33	$	96
2018	$	31	$	90

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Employment Benefit Plans

6 Months Ended

Jun. 30, 2014

Compensation and Retirement Disclosure [Abstract]

Employment Benefit Plans

Employment Benefit Plans

Components of the net cost for the periods presented below for certain employee benefit plans were as follows (in millions):

	Pension Benefits
	Three Months Ended June 30,
Net Cost	2014			2013
Service cost	$	9		$	11
Interest cost	24			23
Expected return on plan assets	(33		)	(31		)
Amortization of net loss	—			4
Net cost recognized	$	—		$	7

	Pension Benefits
	Six Months Ended June 30,
Net Cost	2014			2013
Service cost	$	19		$	23
Interest cost	48			45
Expected return on plan assets	(67		)	(62		)
Amortization of net loss	—			8
Net cost recognized	$	—		$	14

	Retiree Health and Welfare Benefits
	Three Months Ended June 30,
Net Cost	2014		2013
Service cost	$	—	$	1
Interest cost	3		3
Amortization of net loss	—		1
Net cost recognized	$	3	$	5

	Retiree Health and Welfare Benefits
	Six Months Ended June 30,
Net Cost	2014			2013
Service cost	$	—		$	1
Interest cost	6			6
Amortization of prior service credits	(1		)	—
Amortization of net loss	1			2
Net cost recognized	$	6		$	9

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Debt

6 Months Ended

Jun. 30, 2014

Debt Disclosure [Abstract]

Debt

Debt

Notes and Debentures

In April 2014, the Board of Managers (the Board) of the Company authorized an additional $3 billion of debt securities that may be issued pursuant to the debt shelf registration statement filed with the Securities and Exchange Commission (SEC), for a total of $3.25 billion that remains authorized by the Board to be issued through the SEC debt shelf offering process.

In March 2014, BNSF issued $500 million of 3.750 percent debentures due April 1, 2024 and $1 billion of 4.900 percent debentures due April 1, 2044. The net proceeds from the sale of the debentures will be used for general corporate purposes, which may include but are not limited to working capital, capital expenditures, repayment of outstanding indebtedness and distributions.

The Company is required to maintain certain financial covenants in conjunction with $500 million of certain issued and outstanding junior subordinated notes. As of June 30, 2014, the Company was in compliance with these covenants. In the event of non-compliance, the Company would be required to pay any accrued and unpaid interest.

Fair Value of Debt Instruments

At June 30, 2014 and December 31, 2013, the fair value of BNSF's debt, excluding capital leases and unamortized gains on interest rate swaps, was $18,563 million and $16,507 million, respectively, while the book value, which also excludes capital leases and the associated unamortized fair value adjustment under acquisition method accounting related to capital leases and unamortized gains on interest rate swaps, was $17,004 million and $16,066 million, respectively. The fair value of BNSF's debt is primarily based on market value price models using observable market-based data for the same or similar issues, or on the estimated rates that would be offered to BNSF for debt of the same remaining maturities (Level 2 inputs). The fair value of the Company's cash equivalents approximates its carrying value due to the short-term maturities of these instruments.

Guarantees

As of June 30, 2014, BNSF has not been called upon to perform under the guarantees specifically disclosed in this footnote and does not anticipate a significant performance risk in the foreseeable future.

Debt and other obligations of non-consolidated entities guaranteed by the Company as of June 30, 2014, were as follows (dollars in millions):

	Guarantees
	BNSF Ownership Percentage		Principal Amount Guaranteed		Maximum Future Payments		Maximum Recourse Amounta		Remaining Term (in years)	Capitalized Obligations
Kinder Morgan Energy Partners, L.P.	0.5	%	$	190	$	190	$	—	Termination of Ownership	$	2	b
Chevron Phillips Chemical Company LP	—	%	N/Ad		N/Ad		N/Ad		3	$	5	c

^a  Reflects the maximum amount the Company could recover from a third party other than the counterparty.

^b  Reflects capitalized obligations that are recorded on the Company’s Consolidated Balance Sheet.

^c  Reflects the asset and corresponding liability for the fair value of these guarantees required by authoritative accounting guidance related to guarantees.

^d  There is no cap to the liability that can be sought from BNSF for BNSF’s negligence or the negligence of the indemnified party. However, BNSF could receive reimbursement from certain insurance policies if the liability exceeds a certain amount.

Kinder Morgan Energy Partners, L.P.

Santa Fe Pacific Pipelines, Inc., an indirect, wholly-owned subsidiary of BNSF, has a guarantee in connection with its remaining special limited partnership interest in Santa Fe Pacific Pipeline Partners, L.P. (SFPP), a subsidiary of Kinder Morgan Energy Partners, L.P., to be paid only upon default by the partnership. All obligations with respect to the guarantee will cease upon termination of ownership rights, which would occur upon a put notice issued by BNSF or the exercise of the call rights by the general partners of SFPP.

Chevron Phillips Chemical Company LP

In 2007, BNSF entered into an indemnity agreement with Chevron Phillips Chemical Company LP (Chevron Phillips), granting certain rights of indemnity from BNSF, in order to facilitate access to a new storage facility. Under certain circumstances, payment under this obligation may be required in the event Chevron Phillips were to incur certain liabilities or other incremental costs resulting from trackage access.

Indemnities

In the ordinary course of business, BNSF enters into agreements with third parties that include indemnification clauses. The Company believes that these clauses are generally customary for the types of agreements in which they are included. At times, these clauses may involve indemnification for the acts of the Company, its employees and agents, indemnification for another party’s acts, indemnification for future events, indemnification based upon a certain standard of performance, indemnification for liabilities arising out of the Company’s use of leased equipment or other property, or other types of indemnification. Despite the uncertainty whether events which would trigger the indemnification obligations would ever occur, the Company does not believe that these indemnity agreements will have a material adverse effect on the Company’s results of operations, financial position or liquidity. Additionally, the Company believes that, due to lack of historical payment experience, the fair value of indemnities cannot be estimated with any amount of certainty. However, the fair value of any such amount would be immaterial to the Consolidated Financial Statements. Agreements that reflect unique circumstances, particularly agreements that contain guarantees that indemnify for another party’s acts, are disclosed separately, if appropriate. Unless separately disclosed above, no fair value liability related to indemnities has been recorded in the Consolidated Financial Statements.

Variable Interest Entities - Leases

BNSF Railway has entered into various equipment lease transactions in which the structure of the lease contains VIEs. These VIEs were created solely for the lease transactions and have no other activities, assets or liabilities outside of the lease transactions. In some of the arrangements, BNSF Railway has the option to purchase some or all of the equipment at a fixed-price, thereby creating variable interests for BNSF Railway in the VIEs. The future minimum lease payments associated with the VIE leases were approximately $3 billion as of June 30, 2014.

In the event the leased equipment is destroyed, BNSF Railway is obligated to either replace the equipment or pay a fixed loss amount. The inclusion of the fixed loss amount is a standard clause within equipment lease arrangements. Historically, BNSF Railway has not incurred significant losses related to this clause. As such, it is not anticipated that the maximum exposure to loss would materially differ from the future minimum lease payments.

BNSF Railway does not provide financial support to the VIEs that it was not previously contractually obligated to provide.

BNSF Railway maintains and operates the equipment based on contractual obligations within the lease arrangements, which set specific guidelines consistent within the industry. As such, BNSF Railway has no control over activities that could materially impact the fair value of the leased equipment. BNSF Railway does not hold the power to direct the activities of the VIEs and therefore does not control the ongoing activities that have a significant impact on the economic performance of the VIEs. Additionally, BNSF Railway does not have the obligation to absorb losses of the VIEs or the right to receive benefits of the VIEs that could potentially be significant to the VIEs. Depending on market conditions, the fixed-price purchase options could potentially provide benefit to the Company; however, any benefits potentially received from a fixed-price purchase option are expected to be minimal. Based on these factors, BNSF Railway is not the primary beneficiary of the VIEs. As BNSF Railway is not the primary beneficiary and the VIE leases are classified as operating leases, there are no assets or liabilities related to the VIEs recorded in the Company's Consolidated Balance Sheet.

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2014

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Personal Injury

Personal injury claims, including asbestos claims and employee work-related injuries and third-party injuries (collectively, other personal injury), are a significant expense for the railroad industry. Personal injury claims by BNSF Railway employees are subject to the provisions of the Federal Employers’ Liability Act (FELA) rather than state workers’ compensation laws. FELA’s system of requiring the finding of fault, coupled with unscheduled awards and reliance on the jury system, contributed to increased expenses in past years. Other proceedings include claims by non-employees for punitive as well as compensatory damages. A few proceedings purport to be class actions. The variability present in settling these claims, including non-employee personal injury and matters in which punitive damages are alleged, could result in increased expenses in future years. BNSF has implemented a number of safety programs designed to reduce the number of personal injuries as well as the associated claims and personal injury expense.

BNSF records an undiscounted liability for personal injury claims when the expected loss is both probable and reasonably estimable. The liability and ultimate expense projections are estimated using standard actuarial methodologies. Liabilities recorded for unasserted personal injury claims are based on information currently available. Due to the inherent uncertainty involved in projecting future events such as the number of claims filed each year, developments in judicial and legislative standards and the average costs to settle projected claims, actual costs may differ from amounts recorded. Expense accruals and any required adjustments are classified as materials and other in the Consolidated Statements of Income.

Asbestos

The Company is party to a number of personal injury claims by employees and non-employees who may have been exposed to asbestos. The heaviest exposure for BNSF employees was due to work conducted in and around the use of steam locomotive engines that were phased out between the years of 1950 and 1967. However, other types of exposures, including exposure from locomotive component parts and building materials, continued after 1967 until they were substantially eliminated at BNSF by 1985.

BNSF assesses its unasserted asbestos liability exposure on an annual basis during the third quarter. BNSF determines its asbestos liability by estimating its exposed population, the number of claims likely to be filed, the number of claims that will likely require payment and the estimated cost per claim. Estimated filing and dismissal rates and average cost per claim are determined utilizing recent claim data and trends.

Throughout the year, BNSF monitors actual experience against the number of forecasted claims and expected claim payments and will record adjustments to the Company's estimates as necessary.

Based on BNSF’s estimate of the potentially exposed employees and related mortality assumptions, it is anticipated that unasserted asbestos claims will continue to be filed through the year 2050. The Company recorded an amount for the full estimated filing period through 2050 because it had a relatively finite exposed population (former and current employees hired prior to 1985), which it was able to identify and reasonably estimate and about which it had obtained reliable demographic data (including age, hire date and occupation) derived from industry or BNSF specific data that was the basis for the study. BNSF projects that approximately 60, 80 and 95 percent of the future unasserted asbestos claims will be filed within the next 10, 15 and 25 years, respectively.

Other Personal Injury

BNSF estimates its other personal injury liability claims and expense quarterly based on the covered population, activity levels and trends in frequency and the costs of covered injuries. Estimates include unasserted claims except for certain repetitive stress and other occupational trauma claims that allegedly result from prolonged repeated events or exposure. Such claims are estimated on an as-reported basis because the Company cannot estimate the range of reasonably possible loss due to other non-work related contributing causes of such injuries and the fact that continued exposure is required for the potential injury to manifest itself as a claim. BNSF has not experienced any significant adverse trends related to these types of claims in recent years.

BNSF monitors quarterly actual experience against the number of forecasted claims to be received, the forecasted number of claims closing with payment and expected claim payments. Adjustments to the Company’s estimates are recorded quarterly as necessary or more frequently as new events or revised estimates develop.

The following tables summarize the activity in the Company’s accrued obligations for asbestos and other personal injury matters (in millions):

	Three Months Ended June 30,
	2014			2013
Beginning balance	$	386		$	453
Accruals	18			29
Payments	(19		)	(15		)
Ending balance	$	385		$	467

	Six Months Ended June 30,
	2014			2013
Beginning balance	$	387		$	462
Accruals	36			55
Payments	(38		)	(50		)
Ending balance	$	385		$	467

At June 30, 2014, $85 million was included in current liabilities. In addition, defense and processing costs, which are recorded on an as-reported basis, were not included in the recorded liability. The Company is primarily self-insured for personal injury claims.

Because of the uncertainty surrounding the ultimate outcome of personal injury claims, it is reasonably possible that future costs to settle personal injury claims may range from approximately $340 million to $455 million. However, BNSF believes that the $385 million recorded at June 30, 2014, is the best estimate of the Company’s future obligation for the settlement of personal injury claims.

The amounts recorded by BNSF for personal injury liabilities were based upon currently known facts. Future events, such as the number of new claims to be filed each year, the average cost of disposing of claims, as well as the numerous uncertainties surrounding personal injury litigation in the United States, could cause the actual costs to be higher or lower than projected.

Although the final outcome of personal injury matters cannot be predicted with certainty, considering among other things the meritorious legal defenses available and liabilities that have been recorded, it is the opinion of BNSF that none of these items, when finally resolved, will have a material adverse effect on the Company’s financial position or liquidity. However, the occurrence of a number of these items in the same period could have a material adverse effect on the results of operations in a particular quarter or fiscal year.

BNSF Insurance Company

The Company has a consolidated, wholly-owned subsidiary, Burlington Northern Santa Fe Insurance Company, Ltd. (BNSF IC) that provides insurance coverage for certain risks, FELA claims, railroad protective and force account insurance claims and certain excess general liability and property coverage, and certain other claims which are subject to reinsurance. BNSF IC has entered into annual reinsurance treaty agreements with several other companies. The treaty agreements insure workers compensation, general liability, auto liability and FELA risk. In accordance with the agreements, BNSF IC cedes a portion of its FELA exposure through the treaty and assumes a proportionate share of the entire risk. Each year BNSF IC reviews the objectives and performance of the treaty to determine its continued participation in the treaty. The treaty agreements provide for certain protections against the risk of treaty participants’ non-performance. On an on-going basis, BNSF and/or the treaty manager reviews the credit-worthiness of each of the participants. BNSF does not believe its exposure to treaty participants’ non-performance is material at this time. BNSF IC typically invests in time deposits and money market accounts. At both June 30, 2014 and December 31, 2013, there was approximately $480 million related to these third-party investments, which were classified as cash and cash equivalents on the Company’s Consolidated Balance Sheet.

Environmental

The Company’s operations, as well as those of its competitors, are subject to extensive federal, state and local environmental regulation. BNSF’s operating procedures include practices to protect the environment from the risks inherent in railroad operations, which frequently involve transporting chemicals and other hazardous materials. Additionally, many of BNSF’s land holdings are and have been used for industrial or transportation-related purposes or leased to commercial or industrial companies whose activities may have resulted in discharges onto the property. As a result, BNSF is subject to environmental cleanup and enforcement actions. In particular, the federal Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA), also known as the Superfund law, as well as similar state laws, generally impose joint and several liability for cleanup and enforcement costs on current and former owners and operators of a site without regard to fault or the legality of the original conduct. BNSF has been notified that it is a potentially responsible party (PRP) for study and cleanup costs at Superfund sites for which investigation and remediation payments are or will be made or are yet to be determined (the Superfund sites) and, in many instances, is one of several PRPs. In addition, BNSF may be considered a PRP under certain other laws. Accordingly, under CERCLA and other federal and state statutes, BNSF may be held jointly and severally liable for all environmental costs associated with a particular site. If there are other PRPs, BNSF generally participates in the cleanup of these sites through cost-sharing agreements with terms that vary from site to site. Costs are typically allocated based on such factors as relative volumetric contribution of material, the amount of time the site was owned or operated and/or the portion of the total site owned or operated by each PRP.

BNSF is involved in a number of administrative and judicial proceedings and other mandatory cleanup efforts for 237 sites, including 16 Superfund sites, at which it is participating in the study or cleanup, or both, of alleged environmental contamination.

Liabilities for environmental cleanup costs are recorded when BNSF’s liability for environmental cleanup is probable and reasonably estimable. Subsequent adjustments to initial estimates are recorded as necessary based upon additional information developed in subsequent periods. Environmental costs include initial site surveys and environmental studies as well as costs for remediation of sites determined to be contaminated.

BNSF estimates the ultimate cost of cleanup efforts at its known environmental sites on an annual basis during the third quarter. Ultimate cost estimates for environmental sites are based on current estimated percentage to closure ratios, possible remediation workplans and estimates of the costs and likelihood of each possible outcome, historical payment patterns, and benchmark patterns developed from data accumulated from industry and public sources, including the Environmental Protection Agency and other governmental agencies. These factors incorporate into the estimates experience gained from cleanup efforts at other similar sites.

Annual studies do not include: (i) contaminated sites of which the Company is not aware; (ii) additional amounts for third-party tort claims, which arise out of contaminants allegedly migrating from BNSF property, due to a limited number of sites; or (iii) natural resource damage claims. BNSF continues to estimate third-party tort claims on a site by site basis when the liability for such claims is probable and reasonably estimable. BNSF’s recorded liability for third-party tort claims as of June 30, 2014 and December 31, 2013 was $14 million and $13 million, respectively.

On a quarterly basis, BNSF monitors actual experience against the forecasted remediation and related payments made on existing sites and conducts ongoing environmental contingency analyses, which consider a combination of factors including independent consulting reports, site visits, legal reviews and analysis of the likelihood of other PRP's participation in, and their ability to pay for, cleanup. Adjustments to the Company’s estimates will continue to be recorded as necessary based on developments in subsequent periods. Additionally, environmental accruals, which are classified as materials and other in the Consolidated Statements of Income, include amounts for newly identified sites or contaminants, third-party claims and legal fees incurred for defense of third-party claims and recovery efforts.

The following tables summarize the activity in the Company’s accrued obligations for environmental matters (in millions):

	Three Months Ended June 30,
	2014			2013
Beginning balance	$	427		$	450
Accruals	3			(1		)
Payments	(14		)	(9		)
Ending balance	$	416		$	440

	Six Months Ended June 30,
	2014			2013
Beginning balance	$	435		$	458
Accruals	5			(1		)
Payments	(24		)	(17		)
Ending balance	$	416		$	440

At June 30, 2014, $55 million was included in current liabilities.

BNSF’s environmental liabilities are not discounted. BNSF anticipates that the majority of the accrued costs at June 30, 2014, will be paid over the next ten years, and no individual site is considered to be material.

Liabilities recorded for environmental costs represent BNSF’s best estimate of its probable future obligation for the remediation and settlement of these sites and include both asserted and unasserted claims. Although recorded liabilities include BNSF’s best estimate of all probable costs, without reduction for anticipated recoveries from third parties, BNSF’s total cleanup costs at these sites cannot be predicted with certainty due to various factors such as the extent of corrective actions that may be required, evolving environmental laws and regulations, advances in environmental technology, the extent of other parties’ participation in cleanup efforts, developments in ongoing environmental analyses related to sites determined to be contaminated and developments in environmental surveys and studies of contaminated sites.

Because of the uncertainty surrounding these factors, it is reasonably possible that future costs for environmental liabilities may range from approximately $310 million to $580 million. However, BNSF believes that the $416 million recorded at June 30, 2014, is the best estimate of the Company’s future obligation for environmental costs.

Although the final outcome of these environmental matters cannot be predicted with certainty, it is the opinion of BNSF that none of these items, when finally resolved, will have a material adverse effect on the Company’s financial position or liquidity. However, the occurrence of a number of these items in the same period could have a material adverse effect on the results of operations in a particular quarter or fiscal year.

Other Claims and Litigation

In addition to asbestos, other personal injury and environmental matters discussed above, BNSF and its subsidiaries are also parties to a number of other legal actions and claims, governmental proceedings and private civil suits arising in the ordinary course of business, including those related to disputes and complaints involving certain transportation rates and charges. Some of the legal proceedings include claims for punitive as well as compensatory damages, and a few proceedings purport to be class actions. Although the final outcome of these matters cannot be predicted with certainty, considering among other things the meritorious legal defenses available and liabilities that have been recorded along with applicable insurance, BNSF currently believes that none of these items, when finally resolved, will have a material adverse effect on the Company’s financial position or liquidity. However, an unexpected adverse resolution of one or more of these items could have a material adverse effect on the results of operations in a particular quarter or fiscal year.

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Related Party Transactions

6 Months Ended

Jun. 30, 2014

Related Party Transactions [Abstract]

Related Party Transactions

Related Party Transactions

The companies identified as affiliates of BNSF include Berkshire and its subsidiaries. During the six months ended June 30, 2014 and 2013, the Company declared and paid cash distributions of $1.75 billion and $2 billion, respectively, to its parent company. For the six months ended June 30, 2014 and 2013, the Company made tax payments of $395 million and $934 million to Berkshire, and received a tax refund of $21 million and $0 million, respectively.

BNSF engages in various arm's-length transactions with affiliates in the ordinary course of business. The following tables summarize revenues earned by BNSF for services provided to affiliates and expenditures to affiliates (in millions):

	Three Months Ended June 30,
	2014		2013
Revenues	$	34	$	28
Expenditures	$	4	$	4

	Six Months Ended June 30,
	2014		2013
Revenues	$	74	$	66
Expenditures	$	10	$	10

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Commitments and Contingencies - Environmental (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014 Environmental Issue sites	Dec. 31, 2013 Environmental Issue
Loss Contingencies [Line Items]
Number of alleged environmental contamination sites (in sites)					237
Number of environmental superfund sites (in sites)					16
Liability for third-party tort claims					$ 14	$ 13
Accrued obligations for environmental matters, current liabilities	55		55
Future costs for environmental liabilities, minimum					310
Future costs for environmental liabilities, maximum					580
Site Contingency, Estimated Time Frame for Accrued Cost Distributions			10 years
Accrual for Environmental Loss Contingencies [Roll Forward]
Beginning balance	427	450	435	458
Accruals	3	(1)	5	(1)
Payments	(14)	(9)	(24)	(17)
Ending balance	$ 416	$ 440	$ 416	$ 440

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Debt (Tables)

6 Months Ended

Jun. 30, 2014

Debt Disclosure [Abstract]

Schedule of Guarantor Obligations

Debt and other obligations of non-consolidated entities guaranteed by the Company as of June 30, 2014, were as follows (dollars in millions):

	Guarantees
	BNSF Ownership Percentage		Principal Amount Guaranteed		Maximum Future Payments		Maximum Recourse Amounta		Remaining Term (in years)	Capitalized Obligations
Kinder Morgan Energy Partners, L.P.	0.5	%	$	190	$	190	$	—	Termination of Ownership	$	2	b
Chevron Phillips Chemical Company LP	—	%	N/Ad		N/Ad		N/Ad		3	$	5	c

^a  Reflects the maximum amount the Company could recover from a third party other than the counterparty.

^b  Reflects capitalized obligations that are recorded on the Company’s Consolidated Balance Sheet.

^c  Reflects the asset and corresponding liability for the fair value of these guarantees required by authoritative accounting guidance related to guarantees.

^d  There is no cap to the liability that can be sought from BNSF for BNSF’s negligence or the negligence of the indemnified party. However, BNSF could receive reimbursement from certain insurance policies if the liability exceeds a certain amount.

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Accounting Policies and Interim Results (Details) (Burlington Northern Santa Fe Corporation)	Feb. 12, 2010
Burlington Northern Santa Fe Corporation
Business Acquisition [Line Items]
Acquired remaining outstanding shares, percentage	100.00%

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Consolidated Balance Sheets (USD $) In Millions, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Current assets:
Cash and cash equivalents	$ 1,926	$ 2,225
Accounts receivable, net	1,320	1,298
Materials and supplies	866	835
Current portion of deferred income taxes	219	358
Other current assets	147	87
Total current assets	4,478	4,803
Property and equipment, net of accumulated depreciation of $2,904 and $2,232, respectively	53,627	52,363
Goodwill	14,819	14,819
Intangible assets, net	666	821
Other assets	2,348	2,224
Total assets	75,938	75,030
Current liabilities:
Accounts payable and other current liabilities	3,461	3,206
Long-term debt due within one year	376	645
Total current liabilities	3,837	3,851
Long-term debt	17,505	16,361
Deferred income taxes	17,161	17,224
Intangible liabilities, net	872	961
Casualty and environmental liabilities	661	677
Pension and retiree health and welfare liability	358	362
Other liabilities	1,039	982
Total liabilities	41,433	40,418
Commitments and contingencies (see Notes 5 and 6)
Equity:
Member's Equity	34,257	34,367
Accumulated other comprehensive income	248	245
Total equity	34,505	34,612
Total liabilities and equity	$ 75,938	$ 75,030

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Accounts Receivable, Net

6 Months Ended

Jun. 30, 2014

Receivables [Abstract]

Accounts Receivable, Net

Accounts Receivable, Net

Accounts receivable, net consists of freight and other receivables, reduced by an allowance for bill adjustments and uncollectible accounts, based upon expected collectibility. At June 30, 2014 and December 31, 2013, $48 million and $54 million, respectively, of such allowances had been recorded.

At June 30, 2014 and December 31, 2013, $44 million and $50 million, respectively, of accounts receivable were greater than 90 days old.

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Accounts Receivable, Net (Details) (USD $) In Millions, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Receivables [Abstract]
Allowance for bill adjustments and uncollectible accounts	$ 48	$ 54
Accounts receivable greater than 90 days old	$ 44	$ 50

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Reclassifications out of Accumulated Other Comprehensive Income (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended				6 Months Ended
	Jun. 30, 2014		Jun. 30, 2013		Jun. 30, 2014		Jun. 30, 2013
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Tax expense or (benefit)	$ (556)		$ (513)		$ (1,001)		$ (1,004)
Net income	916		884		1,640		1,682
Accumulated Defined Benefit Plans Adjustment [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Actuarial losses	0	[1]	5	[1]	1	[1]	10	[1]
Prior service credits	0	[1]	0	[1]	(1)	[1]	0	[1]
Total before tax	0		5		0		10
Tax expense or (benefit)	0		(2)		0		(4)
Net income	$ 0		$ 3		$ 0		$ 6

[1] This accumulated other comprehensive income component is included in the computation of net periodic pension cost and retiree health and welfare (see Note 7 for additional details).

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Other Assets (Tables)

6 Months Ended

Jun. 30, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Variable Interest Entities

The following table provides information as of June 30, 2014 (in millions):

Unamortized investment balance classified as Other Assets		Remaining commitments classified as Other Liabilities		Maximum exposure to loss
$	345	$	18	$	345