LP Relief is on the Way

February 12, 2014 03:33 AM

The Iowa Secretary of Agriculture and the Federal Energy Regulatory Commission (FERC) announce they have made arrangements for the delivery of 21 million gallons of emergency propane supplies to the Midwest. This is the first time the FERC has used its authority under the Interstate Commerce Act for such an emergency. The measure will provide priority treatment to propane shipments from Mont Belvieu, TX to the Midwest and Northeast regions suffering from severe cold weather.

The fresh supplies will arrive over the next few weeks and it is hoped the action will improve regional stocks and moderate LP pricing in the region. A portion of that supply will also make its way eastward to service the equally strained Northeast.

The full release from Iowa Secretary of Agriculture Bill Northey's office follows...




DES MOINES - Iowa Secretary of Agriculture Bill Northey today commended the Federal Energy Regulatory Commission (FERC) for taking historic steps to help address a shortage of propane supplies in the Midwest.


On February 7, FERC utilized its emergency authority under the Interstate Commerce Act to order Enterprise TE Products Pipeline Company, LLC to prioritize propane shipments through their pipelines. The action had been requested by the National Propane Gas Association and its members.


"The Commission members, including Iowa native John Norris, clearly understood the importance of insuring adequate propane supplies and this historic action is very good news for farmers and rural residents," Northey said. "I greatly appreciate the hard work of Iowa's propane suppliers to meet customer's needs during this challenging time and the leadership of Governor Branstad as we have pursued every opportunity to increase propane supplies."


According to FERC's news release announcing the action, "this marks the first time that commission has used its emergency authority under the Interstate Commerce Act. Section 1(15) of the Act which states that whenever the Commission is of the opinion that an emergency requiring immediate action exists in any section of the country, it has authority to give directions for preference or priority in transportation, embargoes or movement of traffic."


The action will result in an additional 500,000 barrels (21 M gallons) of propane moving into the pipeline over the next 2 weeks. This will free up product for the Midwestern region and help build supply which should ensure access for Iowa residents and livestock producers.

Click here to view FERC's announcement of the action.


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