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Propane availability depends on location of the source

BY don davis

FORUM NEWS SERVICE

The propane outlook for this winter is brighter than a year ago, when shortages nearly quadrupled the heating fuel’s price, but state officials urge poor Minnesotans to apply now for heating assistance if they think they will not be able to fill their tanks.

“The situation is very encouraging,” Gov. Mark Dayton said Tuesday after meeting with about 50 people involved in the propane industry in St. Paul, with another 20 joining by telephone.

Still, he added: “We’re not out of the woods. Nobody is complacent.”

With more than 200,000 Minnesotans, mostly in rural areas, depending on propane to heat their homes, Dayton called in users, transportation officials, suppliers, marketers and others involved in the propane industry to assess the situation.

Many at the meeting said more propane storage and Minnesotans buying more of the heating fuel in the summer instead of waiting for cold weather have helped ease concerns.

Commerce Commissioner Mike Rothman said a Kansas facility that supplies much of Minnesota’s propane increased storage 15 percent. Storage has also been built in Minnesota and North Dakota.

However, the bad news is the permanent shutdown of a propane pipeline at the end of the past heating season is forcing more of the gas onto rails, which already are so congested with North Dakota crude oil that farmers complain they cannot get good service from area railroads.

Dayton lately has complained the BNSF and Canadian Pacific railway companies have put a priority on crude at the expense of commodities such as fertilizer that farmers need and hauling grain to market.

After Tuesday’s meeting, Dayton said he thought railroads can handle added propane shipments, even though “there is no question that the railroad system is very seriously over extended.”

The state and the industry are better prepared to monitor the propane transportation situation this year, Dayton added.

The governor promised to put pressure on the railroads, if needed, “once the situation is real.”

The U.S. Energy Information Administration reports Midwest propane supplies are 1.9 million barrels higher than a year ago, but still 1.6 million barrels below the five-year average.

Minnesota Farm Bureau President Kevin Paap called the meeting “a perfect example” of how to avoid a problem “before the government steps in and makes it worse.”

“We are in a better position if it happens again,” Executive Director Steve Olson of the Minnesota Turkey Growers Association said, recalling last year’s problems.

Besides being the coldest winter in nearly 30 years, crops harvested last fall were wetter than normal, requiring more propane to fuel grain dryers. There were also difficulties getting propane to Minnesota.

Rothman suggested people who think they may not be able to afford propane this year should fill out heating assistance applications right away so money can be sent as soon as the federal government makes it available. Information is available at (800) 657-3710.

Dayton said his administration is urging federal officials to release the money soon.

In addition to heating rural homes and drying grain, propane is used by a variety of businesses and poultry producers and other farmers to heat facilities.

Earlier this year, the Propane Education and Research Council reported that the country had more propane than ever, but it was not where it was needed.

“We’ve never had it in the right place at the right time,” Paap said.

Don Davis
Don Davis has been the Forum Communications Minnesota Capitol Bureau chief since 2001, covering state government and politics for two dozen newspapers in the state. Don also blogs at Capital Chatter on Areavoices.
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