Superior Fuel Co. builds supply security with new rail terminal

Superior Fuel Co. opened a new rail terminal in Duluth, Minnesota, with four 80,000-gallon propane storage tanks on-site.

Superior Fuel Co. opened a new propane rail terminal in Duluth, Minnesota. Photo by David Schauer

The terminal features three double-sided towers connected by a catwalk. The company installed two compressors and two liquid pumps to ensure redundancy and to increase loading and unloading times. It is also installing a generator large enough to power the terminal during an interruption in power.

The terminal gives Superior Fuel Co. added supply security and allows it to take more control over its supply situation as it continues to grow, says President Ryan Gunderson.

During peak demand, Gunderson says, supply in the area can become scarce in a short period of time. He also references the uncertainty surrounding the Line 5 pipeline, which originates in Superior, Wisconsin, passing under the Straits of Mackinac in Michigan and terminating in Sarnia, Ontario, Canada. The state of Michigan has sought to shut down the pipeline, which has served as a propane supply source in the region.

The new terminal also opens the possibility of wholesaling out of the terminal, he adds.

“We have invested heavily in our storage over the last few years,” Gunderson shares in an email to LP Gas. “With what is happening with supply shortages, of all types, we have positioned ourselves given all the uncertainty.”

The project drew support from Duluth Area Chamber of Commerce members.

Superior Fuel Co. is the 34th-largest propane retailer in the U.S., according to LP Gas’ 2021 Top Retailers list. The company sold about 9.4 million gallons of propane in 2020. That also put it 25th on the list ranking multi-state independent companies.