The olefins and polyolefins business unit of Canadian PE and PS producer Nova Chemicals (Calgary, Alberta; www.novachem.com) has reported an operating profit of USD 282m in the first quarter of 2011, compared with USD 185m in the same period in 2010. During this period, sales in the business unit increased by 19% year-on-year to USD 1.23 bn. The company said higher sales volumes in the olefins segments and selling prices that increased more than feedstock costs had contributed to the gains. Higher volumes and lower fixed costs helped Nova achieve an operating profit of USD 3m in its performance styrenics segment, up from USD 1m in the first quarter of 2010. Sales in the segment increased by 17% year-on-year to USD 81m. The company completed the sale of its 50% interest in the Ineos Nova joint venture on 28 February 2011 – see Plasteurope.com of 16.11.2010.

Nova said it had completed several agreements in the quarter for additional sources of feedstock supply for its Joffre, Alberta / Canada complex, providing sufficient ethane to move towards full utilisation of its PE assets at the site by 2013. The company expects to be able to increase PE production above the plant’s nameplate capacity once the feedstock supplies are fully implemented.

Nova also signed memoranda of understanding for ethane supply contracts to utilise Marcellus Shale Basin ethane as the primary feedstock for its Corunna, Ontario / Canada flexi-cracker. These supply sources should ensure that there is sufficient ethane together with other NGL sources available to upgrade the feedstock flexibility at the Corunna cracker by the end of 2013 to utilise up to 100% NGL feeds, Nova said. The ethane supply arrangements are subject to the company finalising a pipeline transportation agreement to transport Marcellus Shale Basin ethane to Sarnia, Ontario / Canada, close to the Corunna facility. Chemical giant Dow (Midland, Michigan / USA; www.dow.com) recently signed a memorandum of understanding for ethane supply from the Marcellus Shale Basin – see Plasteurope.com of 28.04.2011.

The improved results in the first quarter of 2011 follow a year of growth in 2010, thanks to higher margins and increased demand. The year saw an operating profit of USD 788m in the olefins and polyolefins business, up from USD 266m in 2009. The styrenics business reported an operating profit of USD 2m in 2010, compared with a loss of USD 14m in 2009. Sales in the businesses increased by 57% to USD 4.31 bn and 29% to USD 304m respectively.

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Nova Chemicals' annual financial report 2010 as a PDF document