Retailer’s expanded terminal becomes major supply source

Wenner Gas has 680,000 gallons of storage in Rockville, Minn.

The owner of Minnesota-based Wenner Gas Co. had hoped since the early 2000s to construct a propane terminal and secure propane supply in its area.
That hope became a reality about a decade later with a series of shifts in the propane supply and distribution market in Minnesota. Pat Wenner, owner of Wenner Gas, says these issues prompted him to pursue his dream project of building a terminal.

When a rail spur that ran through Cold Spring was decommissioned, Wenner Gas purchased a 6-acre parcel of property in 2009 in Rockville for the terminal, which opened in 2011. The facility featured five railcar-unloading positions along a rail spur, with eight propane storage tanks that held up to 300,000 total gallons.

The propane retailer also used five reciprocating gas compressors and two sliding vane pumps from Blackmer to meet LP gas transfer requirements at the terminal.

“Originally when we built it, everybody thought we were crazy and that there was no way we could do enough gallons to be profitable,” Wenner says. “People didn’t think we would be able to supply even 3 or 5 million gallons, but we managed to supply 11.5 million gallons to retailers that first year.”

Not long after the Wenner Gas Terminal launched, Kinder Morgan Energy Partners LP announced its plans to reverse the flow of the Cochin Pipeline by 2014. The news of the reversal meant there was an opportunity for the Wenner Gas Terminal to step up as a major supply source for propane retailers in the region.

“With the pipeline going down, it was a big leap for us to go from being a backup standby terminal to one that is the main choice in the area,” Wenner says. “We knew that rail would have to play a bigger role in [Minnesota’s] propane supply chain. The opportunity was too good to pass up.”

Wenner says he faced some reluctance from banks that he asked to help finance the terminal’s expansion in 2012, as many weren’t sure the new terminal could make a profit. But another company’s involvement in the project kept things on track.

Wenner Gas signed an agreement with CHS Inc. to enhance the storage and service capabilities at the 3-year-old terminal, essentially doubling its infrastructure. The two companies renamed it the Rockville Propane Terminal because of the split ownership.

The plant can load two transports at a time, and it handles operations the same way as a bulk plant.

Wenner says the investment in the terminal has paid off. Today, it supplies more than 38 million gallons of propane per year to retailers in Minnesota, Wisconsin, North Dakota, Iowa and South Dakota. Because of the terminal’s success, Wenner hopes to open a new terminal in Hinkley, Minn., by the fall.

Photos: Wenner Gas