Wholesale Fuel
Global Opens
Propane Terminal
in Albany
AS THE ENERGY INDUSTRY CHANGES,
Global Partners is evolving and using
its mastery of rail logistics to create new
opportunities. The Waltham, Mass.-based
midstream logistics andmarketing company
is building on its experience with refined
products and crude oil to market propane
to retailers.
LEVERAGING RAIL LOGISTICS
Jim Feeney, Global’s Propane Marketing
Operations Manager, said, Global has
diversified its operations in recent years to
include new products such as crude oil and
ethanol. In the process, the company has
moved a lot of product by rail and devel-
oped rail logistics expertise.
“We have become a rail logistics leader,”
he said. “Whenwe bought threeExxonMobil
terminals in 2007, the Albany terminal and
the Burlington, Vt., terminal were linked by
rail, so we brought supply into Burlington
by rail and learned the rail business. We
started off moving refined products and
ethanol and then got into Bakken crude.”
A good portion of the U.S. propane
supply moves by rail, and many of Global’s
existing customers deal in propane, so the
fuel was a logical addition to the Global port-
folio, according to Steve Schooley, Global’s
Wholesale Marketing Manager. “It’s part
of our diversification strategy. We already
moved into crude and ethanol, and moving
into propane is a natural fit,” he said. “It fits
well with our entire base. Heating oil is our
core business, and most propane dealers are
already selling heating oil, so these are cus-
tomers and friends who we already know.”
NEW PROPANE-ONLY FACILITY
Global began selling propane inMay from
its newly constructed propane-only terminal
at 49-51 Erie Blvd., Albany, which is situated
at the intersection of Interstates 90 and 787.
Global receives shipments by rail and uses
an unloading tower to transfer the fuel to
its tanks, which have a combined capacity
of 630,000 gallons. Customers pick up by
truck from a six-position loading rack.
Because of limitations in the distribution
chain, and the relatively small number of pro-
pane terminals in the region, supplies can get
tight, forcing dealers to drive long distances
for fuel. “We can market out of Albany all
the way to Maine, throughout New England,
down into Long Island and out through New
York State into Pennsylvania,” Feeney said.
He said rail-based terminals have gained
a price advantage because waterborne
terminals must currently compete with
overseas buyers on price. “Most of the
waterborne propane is headed to Europe
or other overseas destinations for a better
price, and propane dealers are lifting less
from waterborne terminals, and rail termi-
nals are filling that supply gap,” he said.
PRICE ADVANTAGES
Global also leverages its expertise in
sourcing products to deliver low prices.
“Our expertise with rail allows us to source
propane from anywhere in the U.S. and
Canada. We can get to the propane and move
it by rail. Wherever we can source at a better
economic value, we bring that value to the
customers lifting in Albany,” Feeney said.
Global offers options for propane
buying. “We offer customers a spot price,
contracts tied to an index, or a fixed price
contract,” Feeney said. “Contract sales are
going extremely well.”
Feeney said Global is excited to grow the
propane business but has no immediate plans
for new terminals. The Northeast is one of
the only areas in the U.S. that is experiencing
a growth in propane sales, he said.
Propane is gaining market share in
transportation with propane autogas, but
Schooley said buyers in the Northeast are
behind other parts of the country. “It’s
getting good traction in the Midwest.
This part of the country has a lot of
room to grow,” he said. “In the future,
it could be a tremendous opportunity.”
STRONG OUTLOOK
Going forward, the outlook for propane
supply is excellent because propane is a
byproduct of both oil refining and natural gas
processing, and activity is strong in both sec-
tors. “Supply is quite plentiful due to a lot of
the shale plays and is going to be even more
plentiful as time goes on,” Feeney said.
In the future the Northeast could see pro-
pane supply from the Bakken Shale region,
which underlies parts of North Dakota and
Montana in the U.S. and Manitoba and
Saskatchewan in Canada. A supply closer
to home could be the Marcellus Shale
region, which underlies parts of New York,
Pennsylvania and other eastern states. “The
future is bright for the propane industry,”
says Feeney, “and Global is incredibly happy
to be a part of it!”
Global
receives
propane at its
new Albany
facility via
railcar.
14 • OIL
&
ENERGY
Global’s new Albany propane terminal
has a six-position loading rack.
