Nova Chemicals has announced the execution of definitive agreements with Hess Corporation (Hess) and Vantage Pipeline Canada Inc./Vantage Pipeline US LP (Vantage) to purchase and transport ethane production from Hess’ Tioga Gas Plant in North Dakota via a proposed pipeline to Alberta, Canada. Nova Chemicals has the right to purchase 100% of the ethane produced at the Tioga Gas Plant under a long-term arrangement.
“The signing of these agreements is an important milestone and we are now one step closer to securing access to a sustainable, long-term supply of cost-competitive feedstock,” said Randy Woelfel, Chief Executive Officer. “This new source diversifies our feedstock supply from ethane based on natural gas flows exported from Alberta to include new sources based on associated gas from oil production, and positions NOVA for long term growth.”
This arrangement represents one of several NOVA Chemicals initiatives to complement its traditional ethane supply sources in Alberta.
The proposed pipeline will be constructed, owned and operated by Vantage and is expected to start-up in Q4-2012, subject to receipt of customary regulatory and other approvals. Vantage filed formal regulatory applications for the pipeline with Canadian and US regulators in early February. The proposed pipeline design will allow for the transport of up to 60,000 bpd of ethane and will be capable of further capacity additions if required in the future.