Following the sale, expected to close by mid-year, Williams will continue to supply the site with ethane feedstock through its Bayou Ethane pipeline system under a long-term agreement. In shedding the Geismar assets, the Oklahoma group said it wants to concentrate on natural gas fundamentals, reduce its commodity margin exposure and secure its fee-based Gulf Coast transportation business. It will use the proceeds to pay down debt as well as fund capital spending projects.
The acquisition will provide Nova with an operating facility that offers immediate, positive cash flow, access to new customers and the benefits of an experienced workforce, said CEO Todd Karran. The company has promised to offer employment to all employees working at the Geismar plant, as well as sales and marketing employees linked to the business in Williams’ Houston, Texas, office.
A key component of the Canadian chemicals and plastics producer’s growth strategy, Karran said, “is to expand to the US Gulf Coast and leverage next generation technology to better serve our customers in the Americas.” Coupled with recently announced plans for a joint venture with Borealis and Total in Texas, which will benefit from access to cheap shale gas-derived feedstocks – see Plasteurope.com of 29.03.2017 – Karran said the company is taking steps to “firmly establish” its presence in the Gulf region.