SURPASS® film resins deliver value through both product performance and processing efficiencies, giving our customers an advantage in the marketplace. This value combination delivers higher margins versus commodity resins.
Our Olefins/Polyolefins business delivered record performance in 2007 and positions the company for strong future earnings growth. High crude oil costs widen our significant cost advantage over U.S. Gulf Coast competitors.
The business is powered by the combination of globally competitive costs from our Alberta Advantage, our proprietary Advanced SCLAIRTECH™ and gas-phase polyethylene technologies and our modernized, low-cost Corunna, Ontario, flexi-cracker.
We are exploiting our advantaged position through high-return growth projects utilizing our existing ethylene capacity. We have expanded output from our Joffre, Alberta, polyethylene plants by 100 million pounds in 2007 and plan to add another 150 million pounds by early 2009 to meet growing demand. Projects are also underway to expand our Ontario region polyethylene capacity by up to 250 million pounds by the end of 2009.
The expanded and modernized Corunna flexi-cracker exploits access to both North American and global feedstocks and end-usemarkets to deliver strong financial returns.
Since production started in 2001, higher value polyethylene resins fromour Advanced SCLAIRTECH technology facility in Joffre, Alberta, have quickly been adopted for a wide range of applications. Superior product performance in critical areas such as toughness, puncture resistance and clarity enable our customers to successfully compete and grow inmarkets including food packaging, industrial storage and recreational equipment. This one-of-a-kind facility was sold-out in 2007.With capacity increases and product mix improvements, it will soon produce 1 billion pounds per year.
New, higher range for Alberta Advantage
The Alberta Advantage is the cornerstone of our long-term competitiveness and a key driver of our profitability. NOVA Chemicals' ethylene cash cost advantage over U.S. Gulf Coast producers averaged a record 17¢ per pound in 2007, well above the 7¢ per pound historical average. Soaring crude oil prices, which averaged $72 per barrel in 2007, led to record feedstock costs for U.S. Gulf Coast producers, while NOVA Chemicals' natural gas costs remained relatively steady, and our advantage expanded dramatically.
ENLARGE
Our Alberta Advantage has strengthened to a new, higher range in parallel with high crude oil prices.
ENLARGE
NOVA Chemicals' Joffre, Alberta, site is the lowest cost ethylene facility in North America and is ranked in the top 25% of ethylene facilities worldwide, ahead of some Middle East producers.
