Regulator orders Enterprise Products to prioritize propane

The Federal Energy Regulatory Commission has ordered Enterprise Products Partners (EPD) to prioritize the transportation of propane on a pipeline that runs from Texas to the Midwest and Northeast, where the freezing weather has caused supplies to plummet and heating-fuel prices to spike.

The one-week directive represents the first time the FERC has used its emergency powers.


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Comments (12)
  • acesfull
    , contributor
    Comments (454) | Send Message
    One question. When the FER Commission orders a company to prioritize transport of their product, do they financially compensate the company for whatever cost is incurred? Or does the company just do what they're told and that's the end of it. Anybody know?
    9 Feb 2014, 06:54 AM Reply Like
  • koolraul
    , contributor
    Comments (8) | Send Message
    I'm not an expert but, I would imagine that there would be some kind of compensation and/or incentive to have them do that because there would be some incurred expenses to accommodate this request e.g., overtime, transportation, etc. Otherwise, the govt will just be imposing its will on a business entity.
    9 Feb 2014, 09:23 AM Reply Like
  • Brucejfern
    , contributor
    Comments (1740) | Send Message
    No, the compensation is the regulatory limit so perhaps EPD gets a higher rate for transport under emergency circumstances.
    9 Feb 2014, 09:29 AM Reply Like
  • fredj
    , contributor
    Comments (155) | Send Message
    They do not get a higher compensation. It's sort of like a mini Venezuelan scenario with Obama & Co running things.
    9 Feb 2014, 09:39 AM Reply Like
  • caperdory
    , contributor
    Comments (489) | Send Message
    how about a three month moratorium on exporting propane
    9 Feb 2014, 11:17 AM Reply Like
  • maybenot
    , contributor
    Comments (6761) | Send Message
    Good for the citizens of our country.
    Good for investors if there is a dip in EPD.
    9 Feb 2014, 12:23 PM Reply Like
  • swiver
    , contributor
    Comments (59) | Send Message
    Isnt it about time this country had an energy policy?
    9 Feb 2014, 12:53 PM Reply Like
  • Baileydog4
    , contributor
    Comments (2) | Send Message
    As one whose entire home is heated by propane, the use of this pipeline that terminates in Selkirk, NY is critical. Other products are shipped through it and I suspect the spike in NG prices had caused EPD to change the mix of what he pipeline carries. I own EPD and think it a great company, but it is their duty to serve all customers. The amount of propane normally shipped is probably the smallest of all any product shipped through the pipeline. I doubt that making this switch will affect the EPD stock price much, if at all.
    9 Feb 2014, 12:57 PM Reply Like
  • maybenot
    , contributor
    Comments (6761) | Send Message
    Baileydog4 -- you are probably right. I have no idea. But one can hope for some good ol' market 'fear.' I've been wanting to get some EPD. It's a wonderful MLP.
    9 Feb 2014, 01:04 PM Reply Like
  • Tadpoles_UK
    , contributor
    Comments (721) | Send Message
    Tariff revenues for the pipeline operator won't be affected very much.
    It will be the shippers that will see disruption in their supplies of whatever commodities are curtailed to provide more propane shipments.
    Of course, the FERC action isn't a quick fix for anything. It takes time for the propane to get all the way up to the northeast once it's put into the pipeline.
    9 Feb 2014, 01:29 PM Reply Like
  • caperdory
    , contributor
    Comments (489) | Send Message
    I live in Minnesota...In late fall I filled up 400gallons at $2.40 or $ it's 400gallons at $5 or $2000....theres a lot of households around that can't afford this runup in price....
    9 Feb 2014, 01:48 PM Reply Like
  • davethedastardly
    , contributor
    Comments (63) | Send Message
    Price gouging - higher prices obtained for products essential to life by methods inconsistent with free market competition. If there is no competition to begin with and the few corporations that have established control of the market allow their supply to dwindle (slowing production, restricting transportation, exporting their product) in order to drive up prices and increase their profits aren't they guilty of price gouging?


    Is heating fuel an option in -20 degree temperatures? Has anything happened to drive up the price of producing LPN?


    Just asking...
    9 Feb 2014, 07:08 PM Reply Like
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