Propane shortage threatens to be 'major cost expense,' says Acadian Seaplants CEO
Nova Scotia seaweed product manufacturer says propane shortage will have ripple effects on many businesses
The pipeline blockade that has shut down rail service into the Maritimes is proving costly for one of Nova Scotia's largest consumers of propane.
The 115,000 square-foot Acadian Seaplants operation in the tiny southwestern Nova Scotia community of Cornwallis manufactures products from seaweed that are shipped all over the world. The plant relies on propane delivered to the province by rail.
"We have just been told that we will run out of propane on Sunday," said CEO Jean-Paul Deveau at the company's Dartmouth, N.S., location. "For us, that is a major cost expense."
He said this will force the company to use light oil, which will cost 63 per cent more than propane.
Acadian Seaplants employs 400 people and its seaweed-based products for food, biochemical and agricultural uses are exported to 80 countries.
Acadian Seaplants gets it propane from the Wilson Fuel propane depot in Bedford, near Halifax. The Cornwallis plant takes three truck deliveries a week.
Wilson Fuel propane manager Lee Johson said the company realized on Tuesday it had enough on hand to supply its customers for five days. It immediately put customers on rations in an effort to stretch the supply into next week.
At the depot on Friday, Johnson pointed to four propane railcars on site.
"One is empty. We're unloading the second one now, which will be empty today, and two are full. And as it sits today, that is absolutely all we have," Johnson said.
He said the company is trying to get supply trucked in from Montreal.
"We just need the government to get involved and get this over," he said.
Port of Halifax highly dependent on rail service
The Port of Halifax also hopes the trains start moving. Sixty per cent of cargo moves in and out of the port via rail.
Spokesperson Lane Farguson said no vessel calls have been cancelled yet, and Halifax's two containers terminals remained in operation Friday.
On the piers, cargo is moving in one direction: up.
"The import cargo that's coming in can't be loaded onto rail and the longer this goes on, the more of it is going to pile up on the docks," said Farguson. "And then on the export side, if we don't have goods coming in, then there is not much to load up on the ships. We're doing our best."
At Acadian Seaplants, Deveau said the extra cost of switching to oil is not the only impact his company will feel.
"The supply chains are going to fall down for all kinds of other products," he said. "Will we be able to ship our products to our customers that are located around the world?"
The blockades that are causing Deveau such anxiety are a show of solidarity for the hereditary chiefs of the Wet'suwet'en who oppose the construction of a 670-kilometre natural gas pipeline through northern British Columbia.
Deveau said he supports peaceful protests, but these have gone too far.
"There is a big problem when a small group of people can disrupt the economic situation of the country and in an illegal manner. We have the rule of law here in Canada. We need to all operate by that," he said.