Nova Chemicals Corp. is closing a 275 million-pound-capacity, linear low density polyethylene line in Corunna, Ontario.
The 43-year-old A-Line was the world's first LLDPE production line, officials with Pittsburgh-based Nova said. The line represents about 8 percent of Nova's LLDPE capacity, and was the firm's smallest-capacity and highest-cost line.
Nova will attempt to transfer the 60 employees affected by the shutdown to other Nova sites, but public affairs Vice President Jeffrey Pina said he expects a number of those employees to take early retirement. About 80 percent of the line's production will be moved to other Nova plants, including a plant in Joffre, Alberta. The shutdown will occur during second-quarter 2004 and will reduce Nova's fixed costs by $5 million to $10 million.
Some of the A-Line's equipment will be moved to Corunna's B-Line, a high density PE line with capacity of 395 million pounds. The B-Line then will be retrofitted to allow it to produce LLDPE. An ongoing streamlining of the B-Line also will increase its annual capacity by 60 million pounds.
In the first nine months of 2003, Nova's olefins/polyolefins unit - which includes PE - posted a loss of $9 million even as sales grew 35 percent to $1.87 billion. Olefins/polyolefins accounted for 64 percent of Nova's nine-month sales.
