Nova announces ethane agreements for delivery to Canada cracker

Calgary-based chemical supplier Nova Chemicals has entered into three agreements to help revamp its Corunna “cracker” in Ontario to utilize up to 100 per cent natural gas liquids (NGL) feedstocks.

The first deal is a transportation service agreement with Sunoco Pipeline for the delivery of ethane feedstock from the Marcellus Shale basin into the Sarnia, Ont. region; the second is for a long-term ethane supply from the Marcellus Shale with Caiman Energy; and the third agreement is for long-term ethane supply from the Marcellus Shale via natural gas company Range Resources Corporation.

Named for a distinctive outcrop near the village of Marcellus, New York, the Marcellus Shale basin extends throughout much of the Appalachian Basin. The shale contains largely untapped natural gas reserves, and its proximity to the high-demand markets along the east coast makes it an attractive target for energy development.

“We are excited to have these critical strategic pieces in place,” said Randy Woelfel, Nova’s CEO. “The capital project enabling our Corunna cracker to utilize up to 100 per cent NGLs is on target, and we anticipate seeing all three project initiatives – safe, reliable pipeline transportation, ethane supply and facility upgrades – come together before the end of 2013.”

Nova said it continues to work with other producers in the Marcellus region, including Statoil, to secure additional ethane feedstock for its Corunna cracker.

“The revamp of the Corunna cracker is step one in our ‘Nova 2020’ vision and will position our Ontario assets as a highly competitive, robust platform that can drive further polyethylene growth,” Woelfel said.

The revamp is still subject to regulatory approvals.