Polyethylene and polystyrene producer Nova Chemicals (Calgary, Alberta / Canada; www.novachem.com) has announced further restructuring to cut costs by around USD 130m by mid-2009. CEO Jeffrey Lipton, who will retire in May 2009, said that the company will shed a further 400 administrative staff and production workers as well as 200 contract workers, around 15% of the current workforce. Additionally, the position of COO will be eliminated.

The aim of the programme is to cut annual operating costs and overheads by around USD 100m compared with 2008. To achieve this, Lipton intends to step up the company's focus on olefins/polyolefins and streamline this business although, other than the job losses, no specific plans have been revealed.

The company will also be “completely restructure" its styrenics business and eliminate or consolidate some venture activities in the segment. The aim is to cut costs in the performance styrenics division by 40%. Parts of the Beaver Valley EPS/PS facility in Monaca, Pennsylvania / USA – which was completely shut down in December 2008 – will be restarted in the near future providing the products can generate quick and sustained cash flows.

Lipton’s successor Christopher Pappas (53) expects to leverage further synergies through the Nova Innovene joint venture (Fribourg / Switzerland; www.nova-innovene.com). These are expected to total USD 135m by end-2009, compared with just USD 80m to date.

Overall, Nova is looking forward with some optimism. The fourth quarter of 2008 got off to a difficult start but the three months were not as weak overall as had been feared, although Lipton pointed to “lousy” results for the period. Demand for PE remained stable, especially in December, while many North American plants went offline. Around 20% of the continent’s ethylene capacity is now offline. Lipton reported that the good order intake continued in January and was “similar to order rates at this time last year”.