Nova Chemicals Gives More Details On Nova 2020
Nova had its second quarter earnings conference call yesterday. I was interested in whether the company would give more details about its plans to build two new polyethylene plants--one in Alberta and another in Ontario. As announced last June, the project also involves an upgrade and an expansion of its Corunna, Ont., cracker. When Nova is finished, the cracker will only crack natural gas liquids, mostly ethane from the Marcellus shale in the Pennsylvania area.
There are a few new details, not many, though I think I understand the project a little better now. Here are the takeaways:
1) The company will have a decision “shortly” on what pipeline plan it is going with. CEO Randy Woelfel says the company is currently analyzing Sunoco Logistics’ “Project Mariner West”. This project involves a 25-mile pipeline being constructed between MarkWest Liberty’s Houston, Pa., plant and Sunoco Logistics’ pipeline grid in Vanport, Pa.
2) There is enough spare capacity in Alberta—the site runs at operating rates of about 85%--to accommodate a new polyethylene plant.
3) Nova says that the total capital needed for Nova 2020 could exceed $1.5 billion over the next seven years.