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... where does that propane go?
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The propane is captured.
Like you, I had a valve replaced a while ago. The technician put my tank upside down on a tall rack, and connected a hose. The other end of the hose led to a 100-pound tank, already sitting on the ground near the rack. When he opened both valves, all the propane (liquid) in my 20-pound tank drained into that big one. I imagine that they resell the scavenged propane.
Bill