Canada’s NOVA Chemicals sees optimism on feedstock outlook – CEO
10 March 2011 19:07 [Source: ICIS news]
TORONTO (ICIS)--?xml:namespace>Canada’s NOVA Chemicals is optimistic on the outlook for feedstocks to its production hubs in Alberta and Ontario after a number of recent supply deals and projects, CEO Randy Woelfel said on Thursday.
“As we move into 2012, we believe our portfolio of new feedstock projects will begin to dramatically improve our supply position,” Woelfel told analysts during the company’s 2010 fourth-quarter results conference call.
In Alberta, the trend of year-on-year declines in ethane supplies was levelling off, and in Ontario, NOVA will tap ethane extracted from natural gas production in the US Marcellus shale gas basin, he said.
NOVA Chemicals’ production hub at Joffre, Alberta, will receive additional ethane from a gas plant in North Dakota by late 2012 when a supply pipeline is due to start up, Woelfel said.
Also in Alberta, NOVA will start receiving new supplies of ethane and other natural gas liquids (NGLs) in early 2012 from Canada AltaGas’s Harmattan-Elkton gas plant project, Woelfel said.
These deals, and a project to extract olefins-rich feedstocks from the upgrading of oilsands in Alberta, would increase and diversify ethane supplies to NOVA’s Alberta plants, he said.
In Ontario, NOVA will, under a deal with US Caiman Energy, get up to 20,000 bbl/day of ethane from Caiman’s West Virginia plant in the Marcellus basin to feed its petrochemicals production complex in Corunna, near Sarnia in southern Ontario.
The arrangement with Caiman is subject to NOVA arranging pipeline transportation to move the ethane from West Virgina to Ontario. Supplies are expected to start arriving in 2013, Woelfel said.
NOVA is also working with other gas firms to secure additional ethane for Corunna, he said.
A possible ethane pipeline project with US firm Buckeye, announced early last year, “remained an attractive option”, he added.
At the same time, NOVA will upgrade its Corunna cracker to position that plant as “fully light-feed capable”, Woelfel said.
NOVA’s Corunna ethylene plant, often described as a “flexi-cracker”, runs on both heavy and light feedstocks. It can currently take ethane for almost one third of its overall feedstock intake, Woelfel said.
Preparations for the Corunna upgrade would be implemented during a planned turnaround this year, he said.
“We continue to believe that the Sarnia valley in Ontario is the best, most economical destination for NGLs extracted by gas producers in the Marcellus basin, and we are committed to being ready for sufficient offtakes by the end of 2013,” he said.
On Wednesday, NOVA reported that its 2010 fourth-quarter net income more than tripled to $60m (€43.2m) as demand and selling prices increased for olefins and polyolefins.
NOVA is a wholly-owned subsidiary of Abu Dhabi’s International Petroleum Investment Company (IPIC), which acquired the company in 2009 for $2.3bn.
($1 = €0.72)
For more on NOVA Chemicals and other producers visit ICIS company intelligenceBy: Stefan Baumgarten+1 713 525 2653
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