Caiman Energy LCC and NOVA Chemicals Corporation have signed a memorandum of understanding (MOU) for the supply of ethane from Caiman’s Fort Beeler Plant near Cameron, West Virginia in the Marcellus Shale Basin.
Under the terms of the agreement, Caiman will expand its existing Fort Beeler gas processing plant to facilitate the extraction of ethane from natural gas and NOVA Chemicals will purchase up to 20,000 barrels per day of ethane on a long-term basis.
"We are excited with this development and pleased to be working with Caiman for the supply of ethane from Marcellus Shale for the Sarnia, Ontario petrochemical market," said Randy Woelfel, chief executive officer of NOVA. "NOVA Chemicals will continue to move forward aggressively with the steps necessary to assure our Corunna cracker is the destination of choice for Marcellus based natural gas liquids."
In addition to finalizing a definitive purchase and sale agreement, and customary reviews and approvals, the arrangement is subject to NOVA Chemicals finalizing a pipeline transportation agreement to transport ethane from Fort Beeler into Ontario.
"The NOVA Chemicals project to move ethane to Sarnia will be instrumental in providing the flow assurances and value that producers need to develop natural gas in the liquids rich area of the Marcellus Shale," said Jack Lafield, president and chief executive officer of Caiman Energy. "We are pleased to be the first company committing volumes in support of such an important project for the producers and local workforce in the Marcellus Shale area."
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