Union Carbide Corp. and Nova Corp. may build separate world-scale polyethylene plants in Alberta by 2000 to take advantage of the province's low ethylene costs. The two firms announced Feb. 29 plans for a 2 billion pound per year ethylene facility in Joffre, Alberta, that will produce ethylene for about 4-5 cents per pound less than competitors on the U.S. Gulf Coast.
Carbide of Danbury, Conn., said it will build a Unipol PE plant with annual capacity of about 1 billion pounds per year.
Nova is considering a 650 million-pound PE plant based on its Sclairtech technology and expects to make a final decision by the third quarter. The plants will market output in North America and Asia.
Carbide and Nova will jointly own the US$600 million new ethylene facility due to start in 2000. It will be Joffre's third ethylene plant and will boost the complex's capacity to 5.4 billion pounds per year, making it the largest single ethylene plant in the world, Nova claimed. Joffre's cost advantages will be rivalled only in Saudi Arabia, officials said in a telephone news conference.
Nova's extensive ethane feedstock supply network is a key part of Joffre's low costs, said Ted Newall, the Calgary, Alberta, firm's vice chairman and chief executive officer. Recent elimination of Alberta's tax on machinery and equipment also helps costs of the expansion, Alberta Premier Ralph Klein said.
Carbide and Nova officials said they expect their technologies will be competitive with metallocene-catalyzed PEs that rivals are introducing to the market. Both firms expect continuing demand for non-metallocene-based resins and, to be safe, are developing their own technological twists.
William Joyce, Carbide's president and chief executive officer, said his firm is working on its own metallocene and other single-site catalysts. Nova is looking at adapting metallocenes to its current technology and is developing new generation Sclairtech resins, said Dan Boivin, president of Novacor Chemicals Ltd., a subsidiary of Nova Corp.
The ethylene and PE expansions are new versions of projects originally conceived by Nova more than 15 years ago when it was building its second ethylene plant. It shelved plans for a third ethylene expansion because of oversupply, but it and Carbide are convinced new low-cost capacity will be needed around the turn of the century.
Carbide sold its Sarnia, Ontario, PE plants to Nova several years ago.
Those plants, and Nova's current PE facility in Joffre, are Unipol licensees. Nova bought DuPont Canada Inc.'s Sclairtech technology and PE plant in Sarnia in 1994.