Sunday, December 24, 2000

Surprise chill drains propane gas supply

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JONESBORO -- As the temperature goes drops, the price of propane gas rises. Adding to the equation, distributors this year counted on a warmer winter, as they've had in recent years. "People planned on warm weather again this year, so enough propane was not stored," said Larry Snodgrass, executive vice president of the Arkansas Propane Association. "An early surge in [the use of] energy will sap the stored supply."

Although retail prices of propane vary among distributors, current wholesale prices are more than double what they have been in the past. "This is a pattern of high prices," Snodgrass said. "We don't know when it will end, but I suspect it will be when the spring weather hits." Propane is a byproduct of both crude oil refining and natural gas production. Rohn Craft, operator of Craft Propane Inc. in Jonesboro, said a shortage of natural gas around the country also has contributed to higher propane prices. Craft Propane raised prices by as much as 20 percent in the past week and a half.

But Craft said higher prices have not translated into bigger profits for the company. "When the price is high, the customer will let up on use," he said. "The volume goes down, and so do the profits." Dewayne Douglas, district manager for Thermogas in Jonesboro, said company prices have gone up 30 cents per gallon since November. The company serves about 3,500 households in Jonesboro and surrounding communities. "People delayed, thinking we wouldn't have cold weather, but now they are rushing to get propane for the winter," Douglas said. Propane is transported by pipeline, rail cars, tanker trucks and delivery trucks. A sudden spell of cold weather causes delays and contributes to a rise in prices.

This article was published on Sunday, December 24, 2000

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-- Martin Thompson (mthom1927@aol.com), December 24, 2000