NOVA Chemicals Corporation has announced it plans to close its Chesapeake, Virginia, site and consolidate its US Styrenics Technology organisation.
NOVA Chemicals Corporation yesterday announced it plans to close its Chesapeake, Virginia, site in 2006. The plant, which manufactures polystyrene, has a capacity of 300 million pounds (136 kilotonnes) per year and compounding capability of 170 million pounds (77 kilotonnes) per year.
“We were able to take this step because upgrades to the Performance Products operations at our Belpre, Ohio, site freed up capacity at other locations,” said Chris Pappas, President of NOVA Chemicals’ Styrenics business. “We remain firmly committed to ZYLAR and our other compounded products and plan to identify production alternatives in 2006.”
NOVA Chemicals also announced the intent to close its ChesapeakeTechnologyCenter and consolidate its US Styrenics Technology organisation at the company’s BeaverValley site in Monaca, Pennsylvania, in 2006.
The closures are expected to reduce costs by approximately $15 million per year and will also have the benefit of reducing working capital requirements.
NOVA Chemicals will take a non-cash, after-tax charge of approximately US $46 million in the fourth quarter of 2005 due to the Chesapeake closure. Additional closure costs of approximately US $10 million after-tax will be accrued during the first quarter of 2006.