Gasoline pipe tagged for closure, sending tankers chasing for costlier out-of-town fuel business chapter 7 electricity test


Michael O’Connor, head of a Virginia retail trade group, predicted that pump prices in the region will rise by between 4 and 6 cents a gallon unless the shutdown is averted. And that’s assuming the next-closest fuel depots in Richmond and Greensboro, North Carolina, have enough capacity to supply the Roanoke region, according to O’Connor, the president and CEO of the Virginia Petroleum Convenience and Grocery Association.

Using the federal government’s average annual fuel consumption of 480 gallons a year for a passenger vehicle, a typical consumer would incur additional gasoline costs of between $19.20 and $28.80 a year based on current prices. Gas in Roanoke cost an average of $2.27 on Wednesday, 28 cents higher than a year ago, according to AAA Mid-Atlantic.

Colonial Pipeline Co., based in Alpharetta, Georgia, said the issue is the physical condition of its buried fuel-delivery spur that pumps petroleum products to more than 30 above-ground vats along U.S. 460 in Montvale, east of Roanoke. The spur, Line 25, branches off northwest of Richmond from the Colonial Pipeline itself, which feeds Gulf Coast refined petroleum products to Mid-Atlantic, Southeast and East Coast markets.

The 80-mile spur will operate at reduced capacity “until approximately September 2018, at which point the line will cease to operate,” according to a company statement in August. Though safe now, the pipe has “extensive” upkeep needs, Colonial said.

O’Connor said he was told by Gerald Beck, Colonial’s chief operating officer, that the work would cost $200 million to $300 million. That’s money Colonial said it isn’t willing to spend, so Line 25 will stop delivering fuel, the trade group chief learned.

Richmond and Greensboro terminals possibly could supply fuel to replace the Montvale operation, but if not, tanker trucks would have to go to such places as Knoxville, Tennessee; Charleston, South Carolina; or Harrisburg, Pennsylvania, O’Connor said.

Montvale is 16 miles from Roanoke, while Richmond is 165 to 190 miles, depending on roads taken. Multiply that by the daily output of Line 25, which is about 170 tanker loads, and the mileage and hours of highway travel stack up. However, the Virginia Department of Transportation said its traffic engineering team predicts minimal effect to the highway system.

Crews would have to seal off the spur after it runs dry, though it could remain in the ground, the Virginia Department of Environmental Quality said. If the Montvale tank farm itself ceased to operate, tank owners would have to test for and remove any petroleum contamination, said DEQ spokesman William Hayden. The tanks, which belong to other companies, could also remain, Hayden said.

“We won’t be happy if the prices go up. A small company is affected a lot by that,” said Diane Etter of Etter’s Tree Service in Hardy, which spends $1,850 on gasoline and diesel fuel during a busy week to fuel up to five vehicles, a chipper and chain saws. “You can’t increase your prices based on gas prices going up.”

Large industry players, such as railroads that haul freight through the state, spoke at a recent convenience and grocery association meeting. Both CSX and Norfolk Southern “fuel the vast the majority of their locomotives that move through Virginia off a Line 25 product,” O’Connnor said.