NECR: Poised To Reclaim Renegade NH Propane Customer

Propane Terminal that Brought PAR Back to Central NH Likely to Switch Back to NECR, Following Sale to Crestwood Equity.

01 April, Claremont NH — Crestwood Equity Partners, L.P. acquired the Claremont propane distribution terminal from Plains All-American Pipeline (PAAP) for $165 million. The 8-car transload facility is located south of Claremont Jct. adjacent to the New England Central Palmer Subdivision. Knowledgable sources indicate that the terminal will terminate its current rail service contract with PAS, and engage NECR {ANRP exclusive sources}.

The Claremont NH propane terminal was the focus of a significant 2018 STB ruling (Docket FD_35842). In 2016, PAAP awarded its rail service contract to PAS after a long NECR incumbency. Despite NECR objections, the Board upheld PAS’s claim to enduring rights along the East Deerfield to Claremont corridor, that had been relatively dormant. The Board agreed that PAS retained rights according to terms of a 1990 ICC trackage rights order (TO), issued in relation to acquisition of B&M, to access online customers on the NECR between East Northfield MA and White River Jct. VT (STB #46315). The PAAP terminal has been PAS’s only active customer on the line since 2016. NECR serves several customers on that segment of its own main line running from St. Albans VT to New London CT {STB Doc. #236201, Exh. A}.

Since 2016, PAS #BF-1 out of Bellows Falls has provided 5-night/week switching of the 8-track [?] terminal. The crew also handles occasional WACR traffic at White River Jct., but their primary job has been to spot propane loads and pull empties.

Crestwood, however, has a broad current relationship with G&W, which serves Crestwood energy facilities Pennsylvania, Ohio, and Rhode Island, and is opting to consolidate that relationship with the additional the Claremont terminal. If that happens, the terminal will be serviced nightly by the NECR #601 crew out of White River Jct. Crestwood-bound loads off of CSX in Palmer will be brought north (NECR #611 Palmer MA — Brattleboro VT, NECR #323 Brattleboro — St. Albans). Cars will be stored at St. Albans, and brought to White River Jct. nightly by NECR #324, and then delivered by NECR #601. NECR #601 handles VRS interchange and haulage traffic at Bellows Falls, serves Cushman Lumber Co. (at Charlestown NH Transfer) and LaValley’s in Claremont (lumber and salt).

The Claremont terminal operator change may impose a temporary reduction or elimination of the PAS #BF-1 local, as well as potentially affecting operations for the nightly PAS #EDBF and #BFED that do a nightly turn between East Deerfield — Bellows Falls.

The Claremont sale is one of the “Definitive Actions in Response to Industry Challenges” that PAAP has recently taken in response to the economic effects of the CVD-19 crisis. Key response actions include:

  • Reduced 2020/2021 capital program by $750 million, or 33% (reduced by $1.35 billion, or 47% including elimination of assumed JV project financing)
  • Decreased PAA common unit / PAGP Class A share distributions payable in May by 50% (reduction of approximately $525 million on annualized basis)
  • Completed an additional $165 million asset sale ($440 million closed or under definitive agreement year to date)
  • Continue to pursue capital and cost reductions throughout the organization and supply chain, as well as additional asset sales

{PAAP news release, 07.April.2020}.