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Bc 03252010 pres

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  • 1. NOVA Chemicals Randy W lf l R d Woelfel Chief Executive Officer Todd Karran Senior Vice President, Chief Financial Officer and Treasurer Barclays Capital High Yield Bond and Syndicated Loan Conference March 25 2010 25,
  • 2. Forward-Looking InformationThis material and the comments made by our management contain forward-looking information with respect to NOVA Chemicals Corporationalone or together with its subsidiaries and affiliates, depending on the context in which such statements are used. By its nature, forward-lookinginformation requires us to make assumptions and is subject to inherent risks and uncertainties. There is significant risk that predictions,forecasts,forecasts conclusions and projections will not prove to be accurate that our assumptions may not be correct and that actual results may differ accurate,materially from such predictions, forecasts, conclusions or projections. We caution you not to place undue reliance on our forward-lookinginformation as a number of factors could cause actual results, conditions, actions or events to differ materially from the targets, expectations,estimates or intentions expressed in the forward-looking information. The words “believe,” “expect,” “plan,” “intend,” “estimate,” or “anticipate”and similar expressions, as well as future or conditional verbs such as “will,” “should,” “would,” and “could” often identify forward-lookinginformation. Specific forward looking information contained in this material include, among others, statements regarding: IPIC’s vision to be agglobal polyolefins leader; IPIC’s growth plans; our strategic fit within the IPIC family; reasons to invest in NOVA Chemicals; our competitive p y g p g y padvantages; general economic conditions; our structurally advantaged feedstock supply; our beliefs about ethane supply; our beliefs aboutfeedstock trends and the crude oil to natural gas ratio; our beliefs about regional ethylene cash costs and feedstocks; our expectationsregarding global polyethylene supply/demand and global demand versus global industrial production growth; our expectations and beliefsregarding polyethylene trade flow and export pricing; and our financing plans and plans for current maturities. With respect to the forward-looking information, we have made assumptions regarding, among other things: future oil, natural gas, natural gas liquids and benzene prices;our ability to obtain raw materials; our ability to market products successfully; the impact of increasing competition; and our ability to obtainfinancing on acceptable terms Some of our assumptions are based upon internal estimates and analyses of current market conditions and terms.trends, management plans and strategies, economic conditions and other factors and are necessarily subject to risks and uncertainties inherentin projecting future conditions and results. Some of the risks that could affect our future results and could cause results to differ materially fromthose expressed include: commodity chemicals price levels (which depend, among other things, on supply and demand for these products,capacity utilization and substitution rates between these products and competing products); feedstock availability and prices; operating costs;terms and availability of financing; technology developments; starting up and operating facilities using new technology; realizing synergy andcost savings targets; our ability to implement our business strategies; meeting time and budget targets for significant capital investments; g g ; y p g ; g g g g p ;avoiding unplanned facility shutdowns; safety, health, and environmental risks associated with the operation of chemical plants and marketing ofchemical products, including transportation of these products; public perception of chemicals and chemical end-use products; the impact ofcompetition; changes in customer demand; changes in, or the introduction of new laws and regulations relating to our business, includingenvironmental, competition and employment laws; loss of the services of any of our executive officers; uncertainties associated with worldeconomies; terrorists attacks; severe weather events; and other risks detailed from time to time in our publicly filed disclosure documents andsecurities commission reports. Our forward-looking information is expressly qualified in its entirety by this cautionary statement. In addition, theforward-looking i ff d l ki information i made only as of th d t of thi material, and except as required b applicable l ti is d l f the date f this t i l d t i d by li bl law, we undertake no obligation t d t k bli ti toupdate publicly this forward-looking information to reflect new information, subsequent events or otherwise. 1
  • 3. NOVA ChemicalsOverview NOVA Chemicals is focused on plastics and chemicals that make everyday life safer safer, healthier and easier Our 2,500 employees develop and manufacture materials for customers worldwide that produce consumer, industrial and packaging products Our innovation and technology create value for gy our customers, their products and the markets they serve NOVA Chemicals is owned by the International Petroleum Investment Company (IPIC) of the Emirate of Abu Dhabi 2
  • 4. NOVA ChemicalsOwnership International Petroleum Investment Company (IPIC) IPIC • A sovereign wealth investment arm of the Government of the Emirate of Abu Dhabi • Invested portfolio value approximately $30 billion • Aa3/AA/AA rated • Will leverage the expertise of its investments to fulfill it l th ti f it i t t t f lfill its vision of becoming a global polyolefins leader NOVA Chemicals • IPIC’s first 100% acquisition • Part of IPIC’s vision of becoming a global polyolefins leader • Excellent strategic fit 3
  • 5. IPIC Investments NOVA Chemicals Corporation NOVA Chemicals Corporation BOREALIS AG (BOREALIS) BOREALIS AG (BOREALIS) OMV Aktiengesellschaft OMV Aktiengesellschaft (OMV) Abu Dhabi National Chemicals Co. Abu Dhabi National Chemicals Co Petrochemicals  Petrochemicals  Integrated Oil Chemical Industry HDQ: Canada HDQ: Austria HDQ: Austria HDQ:  Abu Dhabi Shareholding: 100% Shareholding: 64% Shareholding: 20% Shareholding: 40% Hyundai Oilbank Co., Ltd. (HDO) Gulf Energy Maritime (GEM) PJSC Pak‐Arab Refinary Ltd. Aabar Investments PJSC Oil Refining and Marketing Clean Hydrocarbons Shipping Oil Refining / Products Pipeline Investment Company HDQ: Korea HDQ: UAE HDQ: Pakistan HDQ: Abu Dhabi Shareholding: 70% Shareholding: 30% Shareholding: 30% Shareholding: 71.23% Oman Polypropylene LLC Compañia Española De Petroléos, S.A. Cosmo Oil Co., Ltd. Oil Search Limited Polyolefins Integrated Oil / Petrochemicals Oil Refining and Marketing Oil & Gas – LNG HDQ: Oman HDQ: Spain HDQ: Japan HDQ: Australia Shareholding: 20% Shareholding: 47% Shareholding: 20.76% Shareholding: 18% Energias de Portugal, S.A. MAN Ferrostaal Arab Petroleum Pipeline Company Oasis International Power LLC Utilities Industrial Services Crude Oil Pipeline Power Utilities HDQ: Portugal HDQ: Germany HDQ: Egypt HDQ: Abu Dhabi Shareholding: 4% Shareholding: 70% Shareholding: 15% Shareholding: 18% 4
  • 6. NOVA Chemicals Business Structure Performance INEOS NOVA Olefins/Polyolefins Styrenics Joint Venture(1) North American Ethylene North American EPS Styrene Monomer and SPS Styrenic Performance European SPS and Polyethylene Resins EPS Co-products EPS-Based Ventures 2009 R Revenue: 2009 R Revenue: Revenue(2): 2009 R $2.7B U.S. $0.3B U.S. $1.2B U.S.1. NOVA Chemicals owns 50% of INEOS NOVA2. NOVA Chemicals’ 50% share. 5
  • 7. NOVA ChemicalsExamples of Polyethylene Applications 6
  • 8. Global Polyethylene Demand vs Global Industrial Production Growth IP Growth PE Demand (B lb) 8% 200 6% 180 4% 160 140 2% 120 0% 100 -2% 2% 80 -4% Global IP Growth 60 -6% Global PE Demand 40 -8% 20 -10% 0 20 19 19 19 19 19 19 19 19 19 19 20 20 20 20 20 20 20 20 20 20 20 20 20 20 011 990 991 992 993 994 995 996 997 998 999 000 001 002 003 004 005 006 007 008 009 010 012 013 014Source: ChemSystems, IHS Global Insight, NOVA Chemicals 7
  • 9. Global Polyethylene Supply and Demand Growth (billion pounds) (billion pounds) 8.9% 8 9% 16 16 Demand 12 Growth 12 8 8 2.3% 4 4 0 0 -4 -4 -8 -8 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 North America Europe Middle East Asia Latin America OtherSource: ChemSystems, CMAI, NOVA Chemicals 8
  • 10. Energy and Feedstock Crude Oil to Natural Gas Ratio Crude Oil Ratio, Gas Price 125 20 Crude C d to G Ratio Gas R i WTI Crude, C d Henry H b G H Hub Gas, $/bbl $/mmbtu 18 100 16 14 75 12 10 50 8 6 25 4 2 0 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014Source: CMAI, Platts, NYMEX, NOVA Chemicals 9
  • 11. Regional Ethylene Cash Costs and Feedstock Usecpp North America (2014)40 35 Heavy 24% Light30 28 26 76%20 ROW (2014)10 3 Light 0 Heavy 38% Middle East U.S. Ethane Saudi Arabia U.S., Europe, 62% Ethane Propane Asia NaphthaSource: CMAI, NOVA Chemicals; Data is from March 2009 through February 2010 10
  • 12. Polyethylene Trade Flow Europe: Manufacturing and Sales in Europe Asia: ManufacturingU.S. and Canada: and Sales in AsiaManufacturing andSales in North Americaand Export to Mexico,Latin/South America,Asia and Europe Middle East: Manufacturing in The Middle East and Export to Asia, Europe and Latin/South America 11
  • 13. NOVA ChemicalsReasons for Investment Focused portfolio of products Oriented to more resilient market segments Technology platform that fits the markets we choose to serve Location of assets leads to advantages Western Canada - Access to advantaged feedstocks Eastern Canada - Access to diverse sources of feedstock and proximity to customers Challenges in the near term, but p g , positive outlook in medium- to long-term Recovery from 2008/2009 on the horizon Part of a strong global family with goal to be a leader in the industry 12
  • 14. NOVA ChemicalsRefinancing and Financial Results 13
  • 15. Maturity Profile As of July 6 2009 6,M USD$1,000 $900 150 7.875% Notes 2025 L+312.5bps Fr Notes 2013 $800 6.5% Notes 2012 EDC Facility 75 7.85% Note 2010 Total Return Swap $700 130 AR Sec Program Bilaterals $600 Secured Revolver $500 265 $400 $300 $200 400 400 350 250 $100 Cdn 100 $0 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 2013 2014 2015 2016 2017 2018 2019 2025 14
  • 16. Maturity Profile As of October 31 2009 31,M USD$1,000 $900 8.625% Sr. Note 2019 8.375% Sr. Note 2016 7.875% Notes 2025 L+312.5bps Fr Notes 2013 $800 75 6.5% Notes 2012 7.85% Note 2010 $700 Total Return Swap AR Sec Program 130 Bilaterals Secured Revolver $600 $500 265 $400 $300 $200 400 400 350 350 350 250 $100 Cdn 100 $0 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 2013 2014 2015 2016 2017 2018 2019 2025 15
  • 17. Maturity Profile As of November 30 2009 30,M USD$1,000 $900 8.625% Sr. Note 2019 8.375% Sr. Note 2016 7.875% Notes 2025 L+312.5bps Fr Notes 2013 $800 6.5% Notes 2012 7.85% Note 2010 $700 Total Return Swap AR Sec Program Bilaterals Secured Revolver $600 $500 $400 $300 75 400 $200 400 130 350 350 350 250 $100 Cdn 95 100 100 $0 30 40 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 2013 2014 2015 2016 2017 2018 2019 2025 16
  • 18. Maturity Profile As of February 28 2010 28,M USD$1,000 $900 8.625% Sr. Note 2019 8.375% Sr. Note 2016 7.875% Notes 2025 L+312.5bps Fr Notes 2013 $800 6.5% Notes 2012 7.85% Note 2010 $700 Total Return Swap AR Sec Program Bilaterals Secured Revolver $600 $500 $400 400 $300 400 $200 350 350 350 75 237 $100 200 95 100 100 $0 30 40 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 2013 2014 2015 2016 2017 2018 2019 2025 17
  • 19. Maturity Profile Forecast as of September 1 2010 1,M USD$1,000 $900 8.625% Sr. Note 2019 8.375% Sr. Note 2016 $800 7.875% Notes 2025 L+312.5bps Fr Notes 2013 6.5% Notes 2012 AR Sec Program $700 Bilaterals Secured Revolver $600 $500 $400 400 $300 400 $200 350 350 350 $100 200 100 100 $0 30 40 2010 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 2013 2014 2015 2016 2017 2018 2019 2025 18
  • 20. NOVA ChemicalsNet Income$M 50 0 -50-100-150-200-250 Q408 Q109 Q209 Q309 Q409 19
  • 21. NOVA Chemicals Adjusted EBITDA $M 200 100 0 -100 Removal of FX Impact R l f I Adjusted EBITDA -200 -300 -400 Q408 Q109 Q209 Q309 Q409Adjusted EBITDA is net income before interest expense, income taxes, depreciation and amortization,other gains/losses, mark-to-market feedstock derivatives, IPIC transaction costs and restructuring costs. 20
  • 22. NOVA ChemicalsBond Price Performance$110$100 $90 $80 $70 $60 $50 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09 Jan-10 Feb-10 Mar-10 2012 6.5% Notes 2013 L+312.5bps Notes 2025 7.875% Notes 21
  • 23. NOVA Chemicals Debt Ratings Dominion Bond Rating Service Limited(1) BBB (low) Fitch Ratings Ltd. B+ Moody s Moody’s Investor Service Ba3 Standard & Poor’s B+1. The rating is NOVA Chemicals’ senior unsecured debt rating. DBRS has withdrawn the corporate family debt rating because NOVA Chemicals is now rated investment grade. 22
  • 24. NOVA ChemicalsSummary Business results i B i lt improved steadily i 2009 ending d t dil in 2009, di with a quarterly net profit Successful refinancing – including $700M of senior notes Focus on meeting our customers’ needs customers Part of a larger IPIC family that gives us new opportunities 23
  • 25. The information contained herein is to our knowledge accurate and reliable as of the date of publication. We extend no warranties and make no representations asto the accuracy or completeness of the information contained herein, and assume no responsibility regarding the consequences of its use or for any printing errors. 24