Update: Canadian Government Intervenes to End Rail Standoff

Update (Aug. 22, 4:30 p.m. CDT): Just moments ago, Canadian Labour Minister Steven MacKinnon invoked powers under Section 107 of the Canada Labour Code to intervene in the dispute that brought Canada’s two largest railways to a standstill. The Ministry has imposed binding arbitration and will extend rail contracts in the meantime. Operations on both Canadian National and Canadian Pacific Kansas City are expected to resume in short order. Kudos to the tireless efforts of our colleagues at the Canadian Propane Association, among many others, in helping to facilitate prompt action.

(Aug. 22, 8:30 a.m. CDT): After months of failed contract negotiations between Canada’s two main rail carriers, Canadian National and Canadian Pacific Kansas City, and their unions, a lockout began at midnight on August 22. In anticipation of the lockout, propane and other hazardous materials were embargoed on August 15th. These embargoes are expected to have a ripple effect on U.S. supply, first at locations supplied by Canadian origin rail and secondly via increased demand on U.S.-based supply origins. Marketers are anticipated to seek supplies in the U.S. when they are not able to access product in Canada. About 7% (rail and pipeline combined) of the U.S. propane supply is imported from Canada. 

The National Propane Gas Association (NPGA) is working with the Canadian Propane Association and with the Association of American Railroads (AAR) to assist where possible, as well with legislative contacts. While the outlook is not favorable in the short-term, AAR believes that the passenger impact could lead to a faster resolution of issues. The situation is fluid and may change quickly. 

NPGA recommends reaching out to Benjamin Nussdorf, vice president, regulatory & industry affairs, with questions.