Conversion of former Cochin terminal to rail underway

Alliance Energy Services finalized its acquisition of the Kinder Morgan Energy Partners LP propane terminal and related assets in Benson, Minn. Now, Alliance Energy is in the process of building out the terminal to accept propane via rail. The company’s goal is for the facility to be operational come September.

The Benson terminal previously supplied more than 75 million gallons per year via delivery from the Cochin Pipeline System. Jason Doyle, Alliance Energy president, says he estimates the rail terminal will be capable of delivering between 30 and 40 percent of the volumes the pipeline system previously handled.

“The amount of propane being produced is increasing, but the distribution is changing and causing the industry challenges – and nowhere more so than in Minnesota,” Doyle says. “Minnesota received about 40 percent of its product from Canada via the Cochin Pipeline. We feel there’s a responsibility in the state of Minnesota to get supply into the market, and this terminal is just one piece of many that’s trying to plug the gap.”

According to Doyle, Alliance Energy recently disconnected the pipeline feed at Benson. Inputting the rail infrastructure is now the company’s focus. The key tasks to complete are laying track and building the unloading infrastructure.

Doyle says the facility will be capable of unloading 16 railcars at a time – eight on each side of the track – and that up to 32 railcars will be unloadable each day.

Storage is a key component of the facility, as well. According to Doyle, the Benson terminal contains 17 90,000-gallon tanks, meaning the facility has 1.53 million gallons of storage on hand.

“One reason we built this to a large scale is because we have a lot of storage and we can hold a lot of railcars,” Doyle says. “If service is ever interrupted, we have a lot of volume available on hand.”

Photo: Alliance Energy Services