NOVA Chemicals benefits from large, flexible manufacturing assets that can quickly adjust feedstock mix, in order to optimize margins in response to price and supply volatility in global energy markets.

Our Corunna, Ontario, ethylene flexi-cracker and crude oil processing unit constantly adjust their feedstock mix between “heavy feeds” such as crude oil or naphtha and “light feeds” such as propane or butane. The flexibility of this facility is rare among ethylene crackers worldwide, and it enables margin optimization based on the relative value of feedstock costs and product selling prices. As a result, NOVA Chemicals can benefit from increasingly volatile market conditions that are more challenging for the industry’s less flexible facilities.

NOVA Chemicals significantly expanded the competitive advantages of our Corunna flexi-cracker through a modernization project that was largely completed in 2006. This project further enhanced feedstock flexibility, expanded capacity, and improved energy efficiency by up to 15 percent.

The Corunna facility also capitalizes on its strategic location in the Sarnia, Ontario, region, which provides convenient access to raw materials and to our customers. The facility is positioned to receive feedstocks from pipelines from Western Canada and Eastern seaboard ports, and via rail and truck. In addition, it is centrally located within the largest market for our Company’s products.

In Western Canada, NOVA Chemicals’ Joffre manufacturing facility also benefits from scale and feedstock flexibility. As the largest ethylene/polyethylene complex in the world, the facility’s scale represents an important component of the Alberta Advantage. The Joffre ethylene crackers also have the flexibility to adjust feedstock mix to include propane. This capability, enhanced by a new pipeline connection to a regional storage hub, gives NOVA Chemicals an added cost advantage, along with feedstock supply options during seasonal propane surpluses. Longer-term, this pipeline positions NOVA Chemicals to benefit from new sources of feedstocks from the Alberta oil sands and potential northern gas supplies.