26 May 2011 22:15 [Source: ICIS news]
HOUSTON (ICIS)--Canada's NOVA Chemicals expects to operate at full capacity at its Joffre, Alberta, polyethylene (PE) plant by 2013, and add additional capacity in the future, CEO Randy Woefel said on Thursday.
The projected increase, which would boost production from the current 85-90% capacity, stems from new feedstock arrangements the company executed during the first quarter of 2011, Woefel said.
The feedstock arrangements, which Woeful described as "game changers," include agreements with Hess Corporation and Vantage Pipeline to buy and transport up to 60,000 bbl/day of ethane from Hess's Tioga gas plant in North Dakota, and an agreement with a Williams subsidiary to produce up to 17,000 bbl/day of ethane/ethylene mix extracted from off gas.
The company will also start receiving new supplies of ethane and other natural gas liquids (NGLs) in early 2012 from Canada AltaGas's Harmattan-Elkton gas plant project.
"We are delivering on feedstock options which support full utilisation… as well as underpinning future growth," Woefel said. "We are well positioned to put NOVA back on a growth path, while maintaining our financial strength."
In Ontario, NOVA has made similar feedstock agreements to secure ethane for its Corunna ethylene plant, located near Sarnia in southern Ontario.
The company signed two ethane supply memorandums of understanding to procure, transport and use Marcellus Shale Basin ethane as the primary feedstock for its Corunna complex.
NOVA's Corunna ethylene plant, often described as a "flexi-cracker" runs on both heavy and light feedstocks.
The company plans to upgrade the feedstock capability at the cracker by the end of 2013 to use up to 100% of natural gas liquid (NGL) feeds. However, NOVA wants to retain the flexibility to use heavier feedstocks, such as naptha, Woefel said.
"We are demonstrating that Corunna can continue to do more and operate more flexibly than we certainly would have imagined was possible a few years ago," he said.
On Thursday, NOVA reported that its 2011 first-quarter net income rose 70% year on year to $163m (€116m), driven by higher sales volumes and prices in its core olefins/polyolefins business.
NOVA is a wholly-owned subsidiary of Abu Ahabi's International Petroleum Investment Company (IPC).
($1 = €0.71
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