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Just as propane marketers nationwide had given up hope of squeezing a profit from yet another warm winter, a ferocious St. Valentine's Day Blizzard punctuated a solid month of cold temperatures that saved a dismal heating season but wreaked havoc on the front lines.
Customers reached for propane's warmth with exceptional demand across the entire eastern United States. Nationwide, ropane stockholders posted a record 16.5-million-barrel decline in February, a level more than 60 percent above the most recent five-year average of 10.3 million barrels, according to the U.S. Dept. of Energy.
The record draw reflected mostly the colder-than-normal temperatures that were experienced over large areas of the nation throughout the month.
Frigid weather, heavy snow and ice storms that arrived in late January and stayed into March taxed supplies and hounded propane shipments across U.S. roads and rails.
Meanwhile, New England and the mid-Atlantic states battled multiple crises as a rail strike, pipeline leak and weather-delayed waterbourne deliveries hit simultaneously in mid-February:
* Canadian National Railway (CNR) employees went on strike Feb. 10, delaying shipment of all freight--including propane--and backing railcars throughout the CNR system. CNR provides about 40 percent of the propane supply and distribution for the New York/New England Region.
* Foul weather offshore delayed waterborne propane imports desperately needed to replenish depleted marine terminals in Providence, R.I. and Newington, N.H.
* On Feb. 20, a leak caused by a faulty valve forced a shutdown of TEPPCO's 20-inch propane pipeline in Seymour, Ind. Supplies in storage at Todhunter, Ohio and Watkins Glen, N.Y. were quickly drawn down to empty while the pipeline company worked on repairs.
The ripple effects of those problems forced industry members to move propane long distances to ensure product availability. Northeast propane suppliers arranged for the transportation of propane into the region from storage facilities in Kansas, Michigan and Iowa. One supplier alone on Feb. 24 arranged for 27 transport trucks to haul propane into his New England service area, according to the National Propane Gas Association.
A number of states were granted hours-of-service exemptions within their own jurisdictions during the period. Additionally, NPGA petitioned the federal government to issue a regional 30-day exemption to insure that propane supplies reached customers.
"There seems to be adequate inventory even though we're getting cold temperatures and a lot of winter," says analyst David Hinton at the U.S. Energy Information Administration (EIA).
"You had some carryover inventory from last year and that helped. This was a 'split season,'" Hinton explains, citing a warm beginning. …