US ethane lifts outlook of Nova Chemicals

MOSCOW (MRC) -- Nova Chemicals Corp. debt is trading as if Canada’s largest chemical maker is rated investment grade for the first time in a decade, with projects set to tap cheap US shale gas seen cutting costs and swings in earnings, said Hydrocarbonprocessing.

Credit-default swaps show the cost to insure debt of Nova against default over five years has dropped 50% since June 2013 to 125 basis points, in line with borrowers rated at the lowest investment-grade of Baa3, according to Moody’s Analytics. Calgary-based Nova is rated Ba1 by Moody’s Investors Service and BB+ by Standard & Poor’s, the highest junk-bond grades for each company.

Nova is in the final stages of securing low-cost ethane, a natural-gas liquid, piped from US shale formations to facilities in Ontario and Alberta -- just south of Canada’s oil sands production region. The projects should stabilize fluctuating earnings and cash flow and eventually boost profit, said David Fisher, a Toronto-based analyst at S&P.

"We expect the conditions for a possible upgrade to be met sometime in 2014," Fisher said by phone on May 23. “What we need to see is the company is well on its way to having the projects fully operational and that there are not going to be any major execution challenges as they ramp up."

As MRC wrote before, Nova Chemicals remains on target for a late-2015 startup for its Polyethylene 1 expansion project in Alberta, expected to add at least 950 million lbs/year of linear low density (LLDPE) production the plant. The Calgary-based company has a current annual LLDPE capacity of 1.48 billion lb/year at the Joffre plant.

Nova, which has USD850 million of debt, hasn’t been rated investment grade by S&P since 2002. S&P raised the company’s outlook to positive on Feb. 14.

Nova Chemical is one of the largest world's petrochemical companies, a manufacturer of polyethylene, styrene polymers, monomers, and many other related products.
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MOSCOW (MRC) -- Borealis AG has developed a portfolio of polypropylene compounds that contain post-consumer recycled content intended for use in interior, exterior and under-the-hood automotive applications, said the producer in its press release.

Developed for Borealis' European customers, the three Daplen grades will enable the automotive industry to fulfill the need for materials with enhanced sustainability while ensuring performance on par with virgin materials, according to the company.

"We see a clear trend towards the use of recyclates together with virgin materials," said Jost Eric Laumeyer, Borealis’ global marketing manager for engineering applications. "Today, answering the call for materials with increased sustainability and increasing resource efficiency is no longer an aspiration but a business imperative for the automotive industry."

Harald Hammer, Borealis vice-president of engineering applications, added: "Thanks to cooperation and the close connection we have established with our partners over the years, we have been able to develop these new Daplen grades".

As MRC wrote before, Borealis AG plans to get the first drops of ethylene flowing by the end of May from a plant expansion in the emirate costing more than USD4 billion.

Borealis is a leading provider of innovative solutions in the fields of polyolefins, base chemicals and fertilizers. Borealis is headquartered in Vienna, Austria, and operates in over 120 countries with around 5,300 employees worldwide.
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MOSCOW (MRC) -- Ineos Compounds and Doeflex Compounding have announced the intention to combine their S-PVC compounding businesses, reported Ineos on its site.

The combined business would be run by an integrated management team from both entities.

The proposed combination presents a strategic opportunity for both parties and is highly complementary to Ineos Compounds’ growth strategy.

It is subject to the applicable information/consultation procedures with employee representatives, after which the parties would enter into legally-binding agreements containing customary closing conditions including anti-trust approval from the European Commission.

Until completion of the proposed combination Ineos and Doeflex will continue to run their S-PVC compounding businesses separately.

As MRC informed previuosly, in May 2014, Ineos Group Holdings Ltd. and Solvay SA (SOLB), Europe’s two biggest makers of polyvinyl chloride, won European Union approval for a 4.3 billion-euro (USD6 billion) joint venture of their PVC units after agreeing to sell plants. Ineos and Solvay won’t close their deal until they have a binding agreement with a purchaser approved by EU regulators.

The venture, announced last year, would allow the companies to cut costs in areas from transport to marketing and raise profitability amid a European industry suffering from inflated raw material and energy costs. The PVC market is facing overcapacity and weak demand in Europe, prompting companies in the labor-intensive industry to explore deals. Solvay has said it plans to exit the PVC venture at a later stage.

Ineos Group Limited is a privately owned multinational chemicals company consisting of 15 standalone business units, headquartered in Rolle, Switzerland and with its registered office in Lyndhurst, United Kingdom. It is the fourth largest chemicals company in the world measured by revenues (after BASF, Dow Chemical and LyondellBasell) and the largest privately owned company in the United Kingdom.
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MOSCOW (MRC) -- Arkema, a France-based chemical manufacturer, will increase by 6% the prices of its Plastistrength processing aids sold in Europe from 1 June 2014, or as soon as contracts allow, as per the company's press release.

This increase is dictated mainly by the increase of raw materials.

Plastistrength pprocessing aids help the processing of PVC by promoting fusion, improving melt strength, eliminating surface defects and decreasing plate out. They also enhance formulation metal release properties in extrusion and calendering applications while offering improved cost performance versus traditional lubricant packages.

As MRC informed previously, Arkema announced a further price increase of EUR100/tonne on its whole Evatane EVA range, high content ethylene vinyl acetate (EVA) copolymer effective from 1 May or as contracts allow. As the world wide shortage on vinyl acetate monomer continues, Arkema is doing its upmost to minimize impact on the Evatane availability.

Arkema with annual revenue of EUR6.4 billion is a leading European supplier of chlorochemicals and PVC. Kynar and Kynar Flex are registered trademarks of Arkema Inc.
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MOSCOW (MRC) -- BASF has launched two new MasterTop topcoats for decorative and industrial applications which can be used in public rooms such as education, office and healthcare facilities as well as in industrial environments, as per the company's press release.

With MasterTop TC 417W and MasterTop TC 442W, BASF has added two water-based polyurethane topcoats with enhanced optical properties, improved hiding power and UV resistance to its product portfolio of chemical solutions for construction which is bundled under the Master Builders Solutions brand.

MasterTop TC 417W is a water-based, low-emission polyurethane topcoat. Like all MasterTop products, this polyurethane-topcoat is liquid-applied and hardens to form a matt, seamless surface. Besides its improved hiding power and higher wear resistance it is easier to clean, thus saving the user costs and cleaning efforts. In combination with decorative flooring systems from BASF, MasterTop TC 417W is especially well-suited for application in buildings with high decorative requirements and stringent hygiene standards, for example in offices, canteens and restaurants, schools, hospitals and medical centres.

MasterTop TC 442W is a water-based polyurethane topcoat designed especially for industrial flooring systems. This chemical-resistant, non-solvented topcoat is suitable for both smooth and blinded surfaces. Thanks to the enhanced scratch resistance and higher UV resistance, MasterTop TC 442W provides reliable protection for all subjacent layers of the floor system and ensures a durable, aesthetically pleasing floor for industrial environments such as warehouses, factory halls and corridors.

Master Builders Solutions is BASF’s brand of advanced chemical solutions for construction. The comprehensive portfolio under the Master Builders Solutions brand encompasses lasting solutions for new construction, maintenance, repair and renovation of structures: Concrete admixtures, cement additives, chemical solutions for underground construction, waterproofing solutions, sealants, repair & protection solutions, performance grouts, performance flooring solutions.

As MRC wrote before, in March 2013, BASF started to roll out its Master Builders Solutions brand in Asia Pacific as part of a phased launch process. The global brand is a sign for BASF's commitment to the construction industry and represents a wide range of construction chemical solutions previously sold under a variety of specialty brands.

BASF is the largest diversified chemical company in the world and is headquartered in Ludwigshafen, Germany. BASF produces a wide range of chemicals, for example solvents, amines, resins, glues, electronic-grade chemicals, industrial gases, basic petrochemicals and inorganic chemicals. The most important customers for this segment are the pharmaceutical, construction, textile and automotive industries. BASF had sales of about EUR74 billion in 2013 and over 112,000 employees as of the end of the year.
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