Canada's biggest chemical company Nova Chemicals Corp. has recorded a 14% rise in Q1 profits as margins from polymers increased due to access to cheaper natural gas. Nova continues to enjoy attractive production economics and export opportunities from its ethylene/polyethylene operations, particularly in western Canada. Polyethylene production costs were 21 cents a pound cheaper in Alberta compared with competitors on the U.S. Gulf Coast.
Net income increased to US$50 mln from US$44 mln from year ago levels. Sales increased by 27% to US$1.91 bln.
A venture with Ineos Group Holdings Plc underwent expansion in a bid to halt years of losses from making styrene and polystyrene. Polyethylene output is being expanded to take advantage of natural gas produced in Alberta that is cheaper than supplies available to competitors on the U.S. Gulf Coast.
Operating income in the olefins unit, which makes polyethylene, jumped 65% to US$191 mln. Earnings in the company's styrenics joint venture fell, and the specialty styrenics unit, which makes plastic packaging, narrowed its operating loss.