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FERC Accepts Pipeline Tariff Changes to Address Midwest Crisis
Iowa Ag Connection - 12/09/2019

The Federal Energy Regulatory Commission (FERC) accepted two oil pipeline tariff amendments aimed at helping to move propane to the Midwest. Both ONEOK North System (ONEOK) and Enterprise TE Products Pipeline Company (Enterprise TE) said they had received requests from shippers for the changes after the start of the alternative dispute resolution (ADR) process initiated by FERC last month to alleviate propane pipeline constraints in Midwestern states.

In the ONEOK case, FERC approved a revised pipeline transportation capacity allocation policy allowing shippers to transfer allocated capacity to other shippers through the end of this month, and to receive credit to their allocation history for barrels moved by replacement shippers. In the Enterprise TE case, the company is extending emergency transportation service of propane to the Midwest region. The company had received requests from third-party shippers to continue propane service to Monee, Ill., for a period of time beyond the original date on which it intended to terminate the service. The service will continue until canceled or modified by Enterprise TE.

FERC acted quickly on the requests. Chairman Neil Chatterjee announced the ADR process on Nov. 19 and the pertinent parties met on Nov. 25. Both companies filed their requests on Nov. 26 and FERC issued notices Nov. 27, with a shortened comment period that ended Dec. 4.

FERC continues to monitor the Midwest propane situation, and the ADR process is continuing.

This move is a direct result of Iowa Governor Kim Reynolds' call for an Alternative Dispute Resolution (ADR) process, she said in a media release following FERC's announcement..

"We face a propane crisis in Iowa and FERC's action will bring additional propane to the Midwest, helping our farmers finish harvest," said Reynolds. "FERC's efforts will build on what we have done to ease regulations for propane transporters at the state level. I appreciate Chairman Chatterjee's action and attention to this issue on behalf of Iowa farmers, families, and businesses."

Over the last few weeks, Reynolds has led efforts to address this challenge. She signed two Proclamations of Disaster Emergency to ease the hours of service regulations for propane transporters, and weight limit restrictions to allow vehicles transporting propane to be oversize and overweight.


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