The Herald Bulletin

Morning Update

Local Business

January 24, 2014

Propane shortage spreads as temperatures plunge

Customers forced to pay $5 a gallon as suppliers scramble to find fuel

ANDERSON — Gary Welborn is a propane customer facing a crisis.

“I just went out to look and, if my gauge is not lying to me, I have 41 to 40 percent left,” he said.

That is about 164 gallons, and if he is careful, it could heat his home for another three weeks.

The problem is, there is a propane shortage spreading across the nation.

Since October, 12.8 million barrels of propane have been consumed in the Midwest, compared to a five-year average of 7.3 million barrels for that same period. On Nov. 1, Midwest propane inventories dropped more than two million barrels, creating the largest single-week stock draw for the month since 1993.

And according to the Indiana Propane Gas Association, propane exports are at a record level. Five years ago the United States was exporting 800 million gallons. This year 4.3 billion gallons have been exported.

Bumper crops harvested late in the season were also wet, requiring farmers to use grain dryers fueled by propane adding to the consumption of local reserves.

With bitter cold temperatures gripping the state this month and more than half a million Hoosiers — who depend on propane as a heating source — dipping into the remaining local supplies of fuel, resources have been depleted.

“Normally I get my propane from Milford, Huntington and Griffith,” said Brian Donahue, who is one of the owners of Donahue Gas, 5170 Indiana 9. “Those are all empty.”

Donahue is now buying his propane from Texas, Mississippi and Alabama, but supplies are limited.

“This is unprecedented,” Donahue said. “I’ve never sold propane over $3 a gallon and it is over $5 now.

“We are rationing it.”

Customers who call Donahue today are looking at a two- or three-week wait for an order — or partial order — to be filled.

That is not good news for the 70-year-old Welborn.

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