Nova Chemicals enters the recycling arena

Calgary, Alberta-based Nova Chemicals Corp., a producer of virgin polyethylene, has partnered with recycler Merlin Plastics Supply Inc. with the aim of advancing the supply of high-quality, post-consumer recyclate for consumer packaging.

Currently, recycled PE is mostly used in nonfood applications such as detergent bottles and plastic lumber. The two companies have signed an agreement for Nova to provide financing for a multimillion-dollar project to accelerate Merlin’s expansion into post-consumer resin for food-contact applications. The deal will ensure that Nova has a reliable post-consumer recycled (PCR) supply to offer to its customers. Financial details were not disclosed.

“This partnership with Merlin and our forthcoming suite of PCR-containing resins will help meet our customer and brand owner needs and expand high-quality PCR supply for use in consumer packaging,” Luis Sierra, president and CEO of Nova Chemicals, said.

The partnership marks Nova’s first foray into the world of post-consumer materials, but the company is by no means the only resin producer to venture into this market. With many of the world’s major consumer brands pledging to use an average of 25 percent recycled content in plastics packaging by 2025, resin producers around the world have sought to secure their supply of high-quality material to meet this demand.

Borealis AG, for example, was one of the earliest producers of virgin plastics to invest in recycling capacity, but it has since been followed by a host of others, including Dow Inc., Indorama Ventures Public Co., Saudi Basic Industries Corp., BASF SE and many more.

“We expect demand for PCR to increase tenfold in the next five years based on brand owner sustainability commitments,” said Greg DeKunder, vice president of marketing for Nova Chemicals.

This partnership will focus on developing technical solutions to improve the quality and consistency of recycled high density PE resin for use in everyday products and packaging, including food applications.

“With this agreement, we will be able to turn more recycled plastic packaging into valuable new source material for consumer products and packaging,” said Merlin Plastics President Tony Moucachen.

Headquartered in Delta, British Columbia, the recycler has two facilities in that province: a sorting plant in Gifford, on the West Coast, and a processing plant in Delta, where plastic container packaging is reprocessed into pellets. Nova Chemicals’ funding will expand the equipment in the Delta facility and enhance Merlin’s processing of recyclate for food packaging applications.

For Nova, the partnership is one of several collaborations the company is pursuing to build its recycled offerings, with commercial quantities beginning in 2021. Ultimately, Nova Chemicals plans to offer 100 percent post-consumer PE and PCR blended with its virgin grades.