A Canary In The Coal Mine: Park Rapids, Minnesota, Ground Zero For Nationwide Propane Shortage

For background to the story Don sent me to day:

• Kinder Morgan reverses the Cochin Pipeline; moving propane from the US to Canada, June 28, 2012
• Diluent access to the Cochin pipeline, June 3, 2013
• Midwest farmers report severe shortage of propane, November 11, 2013
• RBN Energy anticipates propane shortage in US due to pipeline reversal, November 29, 2013
• Why propane spiked in price, December 23, 2013

This is the story Don sent me today: "A Nationwide Propane Shortage Hits Park Rapids."

RBN Energy anticipated this shortage; the industry reported on the reversal of the propane pipeline for quite some time, starting as far back as 2012, and suggesting there might be shortages in the US in 2014. Here it is, not every 20 days into 2014 and we are seeing serious shortages. There were warning signs in the autumn as farmers started reporting a shortage of propane which they needed to dry their harvest.

From the Park Rapids story, reported by the Park Rapids Enterprise:

A critical nationwide shortage of propane, coupled with one of the coldest winters on record, is giving rural Minnesotans the chills.

And things are about to get worse.

The Cochin Pipeline, which services up to 50 percent of propane needs from Canada into the U.S., is scheduled to shut down permanently in April, mostly due to the emergence of shale markets. That main artery has been functionally inert for much of the winter, forcing propane suppliers to hunt all over the country for alternate sources.

“The line has seen varying usage over the past many years for Minnesota marketers depending upon crop drying, weather-related needs and pricing differentials,” Cochin’s website says.

“In recent times the average daily draw on the line from the two Minnesota terminals at Benson and Mankato has totaled about 8,000 barrels per day. This equates to about 120,000,000 gallons of propane per year. In reality this draw happens on a sporadic basis with large amounts of product being drawn at peak times, and then the system going for days or weeks with little or no propane drawn at either terminal.”