NOVA Chemicals: Record Olefins/Polyolefins Performance - Strong Outlook



    PITTSBURGH, October 24 /CNW/ - NOVA Chemicals Corporation
(NYSE:  NCX)(TSX:NCX):

    All financial information is in U.S. dollars unless otherwise indicated.

    NOVA Chemicals Corporation (NOVA Chemicals) reported net income of $97
million ($1.16 per share diluted) for the third quarter of 2007.

    Net income for the third quarter compares to net income of $80 million
($0.96 per share diluted) for the second quarter of 2007 and a net loss of $24
million ($0.29 loss per share) for the third quarter of 2006, which included
charges of $92 million ($1.12 per share diluted) related to restructuring and
insurance wind-up costs.

    The Olefins/Polyolefins business unit reported record EBITDA of $280
million in the third quarter, up from $228 million in the second quarter. The
Alberta Advantage averaged a record 21 cents per pound in the third quarter,
up from 13 cents per pound in the second quarter, and has expanded further in
October.

    "We believe the very strong third quarter market conditions for our
Olefins/Polyolefins business will continue into the fourth quarter and well
beyond," said Jeff Lipton, NOVA Chemicals' President and CEO. "We are
experiencing strong domestic and export demand and improving margins due to
price increases that exceed feedstock cost changes."

    During the third quarter, the expanded INEOS NOVA styrenics Joint Venture
was approved by the U.S. Federal Trade Commission (FTC) and commenced
operations on Oct. 1, 2007. In addition, the INEOS NOVA Joint Venture agreed
to acquire the exclusive production rights to Sterling Chemicals' Texas City,
Texas styrene monomer asset. (See page 4 for details.)

    "The combination of the formation of the expanded Joint Venture and the
agreement with Sterling creates a strong foundation for further cost
reductions in our styrenics business. We also expect market conditions in
Europe to recover from a weak summer holiday period," said Jeff Lipton.

    
               EBITDA from the                Third            Second
                 Businesses                  Quarter          Quarter
              ($U.S. millions)                 2007             2007

     Olefins/Polyolefins                            $280             $228
     Performance Styrenics                             3               (6)
     STYRENIX                                        (21)              29
                                         ---------------- ----------------
     EBITDA from the
      Businesses                                    $262             $251
    

    NOVA Chemicals will host a conference call today, Wednesday, October 24,
2007 for investors and analysts at 1 p.m. EDT (11 a.m. MDT; 10 a.m. PDT).
Media are welcome to join this call in "listen-only" mode. The dial-in number
for this call is (416) 406-6419. The replay number is (416) 695-5800
(Reservation No. 3207770). The live call is also available on the Internet at
www.investorcalendar.com (ticker symbol NCX)

    NOVA Chemicals Highlights

    (millions of U.S. dollars, except per share amounts and as noted)

    These Highlights should be read in conjunction with NOVA Chemicals' other
interim and annual financial statement disclosures, as well as its 2006 Annual
Report.

    
                                   Three Months Ended    Nine Months Ended
                                ------------------------ -----------------
                                Sep. 30 June 30 Sep. 30  Sep. 30  Sep. 30
                                 2007    2007   2006 (1)   2007   2006 (1)
                                ------- ------- -------- -------- --------
    Revenue                     $1,755  $1,676   $1,712   $4,937   $4,884

    Adjusted EBITDA (2)
    Olefins/Polyolefins
        Joffre Olefins            $172    $121     $160     $400     $455
        Corunna Olefins             57      58       28      157       89
        Polyethylene                60      50       83      132      149
        Eliminations                (9)     (1)       -      (22)     (12)
                                ------- ------- -------- -------- --------
      Olefins/Polyolefins Total    280     228      271      667      681

    Performance Styrenics            3      (6)      (2)      (9)      (3)

    STYRENIX (3)
        Styrene Monomer            (22)     23        5       11       (1)
        North American Solid
         Polystyrene                (7)     (7)      (8)     (20)     (21)
        European JV                  1      13        -       29       (7)
        Eliminations                 7       -       (1)       7       (1)
                                ------- ------- -------- -------- --------
      STYRENIX Total               (21)     29       (4)      27      (30)

                                ------- ------- -------- -------- --------
    EBITDA from the Businesses
     (4)                           262     251      265      685      648

    Corporate (5)                  (11)    (31)     (68)     (59)    (142)
                                ------- ------- -------- -------- --------

    Adjusted EBITDA (2)           $251    $220     $197     $626     $506
                                ------- ------- -------- -------- --------

    Operating income              $188    $150      $13     $439     $157

    Net income (loss)              $97     $80     $(24)    $221      $78

    Earnings (loss) per common
     share
      - basic                    $1.17   $0.97   $(0.29)   $2.67    $0.95
      - diluted                  $1.16   $0.96   $(0.29)   $2.65    $0.94

    Weighted-average common
     shares Outstanding
     (millions) (6)
      - basic                       83      83       83       83       83
      - diluted                     84      84       83       84       83


    (1) See Note 2 on page 80 of the 2006 Consolidated Financial
     Statements within the Annual Report for a discussion of the prior
     period restatement related to stock-based compensation for employees
     eligible to retire before the vesting date (EIC 162). The impact to
     net income (loss) for the three months and nine months ended Sep. 30,
     2006 was a $1 million benefit ($0.01 per share) and a $nil million
     loss ($0.00 per share), respectively. See the last paragraph of Note
     1, page 25.
    (2) Net income (loss) before restructuring charges, income taxes,
     other gains and losses, interest expense and depreciation and
     amortization (see Consolidated Statements of Net Income (Loss) on
     page 19 and Supplemental Measures on page 18).
    (3) The third quarter of 2007 is the last quarter that NOVA Chemicals
     will report the results for the STYRENIX business unit. Beginning in
     the fourth quarter of 2007, NOVA Chemicals will report the results of
     the INEOS NOVA Joint Venture, which was expanded to include North
     American assets and commenced operations on Oct. 1, 2007.
    (4) Net income (loss) before income taxes, other gains and losses,
     interest expense and depreciation and amortization from the
     Olefins/Polyolefins, Performance Styrenics and STYRENIX business
     units, which equals NOVA Chemicals' Adjusted EBITDA less Corporate
     (see Supplemental Measures on page 18).
    (5) See table on page 12 for a description of all Corporate Items.
    (6) Weighted-average number of common shares outstanding during the
     period used to calculate the earnings (loss) per share (see Note 6,
     page 28).
    

    NOVA Chemicals Supplemental Financial Data

    (millions of U.S. dollars, except as noted)

    This Supplemental Financial Data should be read in conjunction with NOVA
Chemicals' other interim and annual financial statement disclosures, as well
as its 2006 Annual Report.

    
                                  Three Months Ended     Nine Months Ended
                              -------------------------- -----------------
                              Sep. 30 June 30   Sep. 30   Sep. 30  Sep. 30
                               2007    2007       2006     2007     2006
                              ------- -------   -------- --------- -------
    Depreciation and
     amortization expense
      Olefins/Polyolefins        $48     $45       $43       $136    $129
      Performance Styrenics        8       8         3         21       9
      STYRENIX                     5       5        27         14      80
      Corporate                    2       2         2          6       6
                              ------- -------   -------- --------- -------
                                 $63     $60       $75       $177    $224

    Capital expenditures
      Olefins/Polyolefins        $23     $15       $22        $68     $69
      Performance Styrenics        6       2        16         10      67
      STYRENIX                     6       7         9         18      16
                              ------- -------   -------- --------- -------
                                 $35     $24       $47        $96    $152


    After-tax return on
     capital
    employed (1)                14.4%   13.0%      0.9%      12.5%    6.2%

    Average capital employed
     (2)

      NOVA Chemicals          $3,614  $3,316    $3,759     $3,303  $3,703
      Olefins/Polyolefins     $2,723  $2,538    $2,503     $2,529  $2,433
      Performance Styrenics     $377    $368      $265       $339    $234
      STYRENIX                  $465    $390    $1,108       $418  $1,137


    Funds from operations (3)   $186    $160       $83       $408    $251

    Cash (used in) from
     operations                 $(15)   $115       $26       $124    $250


    Return on average common
     equity (4)                 44.3%   42.5%(5)  (7.0)%     40.4%    7.9%


    (1) After-tax return on capital employed equals NOVA Chemicals' net
     income (loss) plus after-tax interest expense (annualized) divided by
     average capital employed (see Supplemental Measures on page 18).
    (2) Average capital employed equals cash expended on property, plant
     and equipment (less accumulated depreciation and amortization) and
     working capital, and excludes assets under construction and
     investments. Amounts are converted to U.S. dollars using quarter-end
     exchange rates (see Supplemental Measures on page 18).
    (3) See Supplemental Measures on page 18.
    (4) Return on average common equity equals annualized net income
     (loss) divided by average common equity.
    (5) Restated - see Note 7 on page 28.
    

    Update on NOVA Chemicals' Strategic Activities

    INEOS NOVA Expanded Joint Venture

    On Oct. 1, 2007, the expanded INEOS NOVA Joint Venture commenced
operations. In addition to the European assets already included in the INEOS
NOVA Joint Venture, the expanded 50:50 venture includes NOVA Chemicals' North
American styrene and solid polystyrene (PS) assets as well as its NAS(R) and
ZYLAR(R) performance resins. The venture also includes INEOS' North American
styrene and solid PS assets and its line of specialty polymers. NOVA Chemicals
retains its North American expandable polystyrene (EPS), ARCEL(R) and
DYLARK(R) resins, and its EPS-based downstream business ventures.

    The INEOS NOVA expanded Joint Venture is expected to have annual revenues
of approximately $3.8 billion and is the largest styrene and solid PS producer
in North America and the largest solid PS and EPS producer in Europe.

    The newly expanded Joint Venture is initially targeting $80 million per
year of additional cost reductions and EBITDA improvement, including the
expected efficiency gains from the anticipated acquisition of Sterling's
production rights. NOVA Chemicals' 50% share of this improvement would be $40
million per year.

    On Oct. 10, 2007, INEOS NOVA announced its plans to shut down the
Montreal, PQ polystyrene site by the end of 2007. The plant has annual
production capacity of 120 million pounds, which is approximately 6% of INEOS
NOVA's North American polystyrene production capacity or about 2% of North
American polystyrene industry capacity. This action represents the first step
toward achieving the North American synergies target for INEOS NOVA, as
production will be moved to the Joint Venture's most efficient plants.

    INEOS NOVA Joint Venture Agrees to Acquire Rights to Sterling's Styrene
Production

    On Sep. 18, 2007, NOVA Chemicals announced that it had agreed to acquire
the exclusive production rights to the styrene production from Sterling
Chemicals' facility on behalf of INEOS NOVA. These rights were assigned to
INEOS NOVA on Oct. 1, 2007. The FTC is currently reviewing the transaction.

    The $60 million cost of the transaction will be fully funded by the INEOS
NOVA Joint Venture from cash on hand. Sterling's styrene facility in Texas
City, Texas has 1.7 billion pounds of annual production capacity, which
represents approximately 11% of North American capacity and 3% of global
capacity.

    As part of its $80 million per year synergy target, INEOS NOVA is
initially targeting $30 million of increased annual EBITDA due to increased
sales and lower operating costs by shifting production to the more efficient
joint venture styrene monomer sites.

    OLEFINS/POLYOLEFINS BUSINESS UNIT

    
    Financial Highlights
    (millions of U.S. dollars,
     except as noted)              Three Months Ended    Nine Months Ended
                                 ----------------------- -----------------
                                 Sep. 30 June 30 Sep. 30  Sep. 30  Sep. 30
                                  2007    2007    2006     2007     2006
                                 ------- ------- ------- --------- -------
    Revenue
    -----------------------------
      Joffre Olefins (1)           $448    $425    $417    $1,284  $1,317
      Corunna Olefins (1)           595     502     557     1,494   1,482
      Polyethylene (1)              519     475     507     1,417   1,467
      Eliminations                 (356)   (296)   (335)     (949) (1,034)
                                 ------- ------- ------- --------- -------
        Total                    $1,206  $1,106  $1,146    $3,246  $3,232


    EBITDA (2)
    -----------------------------
      Joffre Olefins               $172    $121    $160      $400    $455
      Corunna Olefins                57      58      28       157      89
      Polyethylene                   60      50      83       132     149
      Eliminations (3)               (9)     (1)      -       (22)    (12)
                                 ------- ------- ------- --------- -------
        Total                      $280    $228    $271      $667    $681

    Operating income
    -----------------------------
      Joffre Olefins               $157    $108    $148      $360    $418
      Corunna Olefins                41      42      13       110      47
      Polyethylene                   43      34      67        83      99
      Eliminations (3)               (9)     (1)      -       (22)    (12)
                                 ------- ------- ------- --------- -------
        Total                      $232    $183    $228      $531    $552

    Sales Volumes (millions of
     pounds)
    -----------------------------
      Polyethylene
        Advanced SCLAIRTECH(TM)
         resins(4)                  222     225     224       641     634
        All other polyethylene
         resins                     608     605     576     1,820   1,740
                                 ------- ------- ------- --------- -------
          Total                     830     830     800     2,461   2,374


    (1) Before intersegment eliminations between the business units.
    (2) Net income before income taxes, other gains and losses, interest
     expense, depreciation and amortization (see Supplemental Measures on
     page 18).
    (3) Represents intersegment profit eliminations.
    (4) Polyethylene resins that are produced using Advanced SCLAIRTECH
     technology at the Joffre site, including SCLAIR(R) and SURPASS(R)
     resins.
    

    
    Operating Highlights
    Average Benchmark Prices (1)
    (U.S. dollars per pound,
     unless otherwise noted)      Three Month Average   Nine Month Average
                                ----------------------- ------------------
                                Sep. 30 June 30 Sep. 30  Sep. 30   Sep. 30
                                 2007    2007    2006      2007     2006
                                ------- ------- ------- ---------- -------
    Benchmark Principal
     Products:
    Ethylene (2)                  $0.50   $0.45   $0.51      $0.45   $0.49
    Polyethylene - LLDPE butene
     liner (3)                    $0.67   $0.62   $0.69      $0.62   $0.67
    Polyethylene - weighted-
     average benchmark (4)       $ 0.70  $ 0.64  $ 0.71     $ 0.65  $ 0.69

    Benchmark Raw Materials:
    AECO natural gas (dollars
     per mmBTU) (5)               $4.96   $6.43   $5.03      $5.90   $5.64
    NYMEX natural gas (dollars
     per mmBTU) (6)               $6.13   $7.56   $6.53      $6.88   $7.47
    WTI crude oil (dollars per
     barrel) (7)                 $75.38  $65.03  $70.48     $66.23  $68.22


    (1) Average benchmark prices do not necessarily reflect actual prices
     realized by NOVA Chemicals or any other petrochemical company.
    (2) Source: Chemical Market Associates, Inc. (CMAI) U.S. Gulf Coast
     (USGC) Net Transaction Price.
    (3) Linear Low-Density Polyethylene (LLDPE) butene liner. Source:
     Townsend Polymer Services Information (TPSI).
    (4) Benchmark prices weighted according to NOVA Chemicals' sales
     volume mix in North America. Source for benchmark prices: TPSI.
    (5) Source: Canadian Gas Price Reporter, weighted average daily spot
     gas price, values in millions of British Thermal Units (mmBTU).
    (6) Source: New York Mercantile Exchange (NYMEX) Henry Hub 3-Day
     Average Close.
    (7) Source: NYMEX WTI daily spot-settled price average for calendar
     month.
    

    Review of Operations

    Olefins/Polyolefins

    The Olefins/Polyolefins business unit reported record EBITDA of $280
million in the third quarter of 2007, up from $228 million in the second
quarter. Margins expanded as higher selling prices for ethylene and
polyethylene and lower Alberta feedstock costs outpaced higher feedstock costs
at the Corunna flexi-cracker.

    Third quarter results were negatively impacted by approximately $11
million higher costs ($7 million after-tax) due to the appreciation of the
Canadian dollar. Most of NOVA Chemicals' Canadian dollar denominated costs
reside within the Olefins/Polyolefins business unit's results.

    Joffre Olefins

    Third Quarter 2007 Versus Second Quarter 2007

    The Joffre Olefins segment reported EBITDA of $172 million in the third
quarter of 2007 up from $121 million in the second quarter of 2007. The
improvement was primarily due to lower ethane feedstock costs.

    Joffre Olefins' ethane feedstock costs decreased sharply from the second
quarter due to lower Alberta natural gas prices, which were down 23%. In
comparison, United Stated Gulf Coast (USGC) ethane prices were 13% higher
compared to the second quarter. USGC ethane prices rose throughout the third
quarter and reached record levels as ethane demand strengthened due to strong
demand for ethylene and higher prices for competing feedstocks such as
naphtha.

    As a result, the Alberta Advantage averaged a record 21 cents per pound
in the third quarter, up from 13 cents per pound in the second quarter and
significantly higher than the 7 cents per pound historical average. The
Alberta Advantage expanded further and is about 25 cents per pound in October.
NOVA Chemicals uses ethylene produced at its Joffre, Alberta, facility to make
approximately 65% of its polyethylene.

    Third Quarter 2007 Versus Third Quarter 2006

    The Joffre Olefins segment reported EBITDA of $172 million in the third
quarter of 2007 compared to $160 million in the third quarter of 2006. The
EBITDA improvement was primarily due to increased sales volume and strong
ethylene margins in the third quarter of 2007.

    Nine Months Ended Sep. 30, 2007 Versus Nine Months Ended Sep. 30, 2006

    The Joffre Olefins segment reported EBITDA of $400 million for the nine
months ended Sep. 30, 2007 compared to $455 million for the nine months ended
Sep. 30, 2006. This decrease was primarily due to lower ethylene selling
prices and higher feedstock costs. Industry ethylene selling prices were 9%
lower in the first nine months of 2007 than in the first nine months of 2006,
as prices remained elevated in early 2006 in the aftermath of Hurricane
Katrina. AECO daily spot gas prices were 5% higher in the first nine months of
2007 compared to the same period last year.

    Corunna Olefins

    Third Quarter 2007 Versus Second Quarter 2007

    The Corunna Olefins segment reported EBITDA of $57 million in the third
quarter of 2007, compared to $58 million in the second quarter of 2007.
Margins remained steady as higher ethylene and co-products revenue was offset
by higher feedstock costs.

    USGC ethylene industry prices averaged 50 cents per pound in the third
quarter of 2007 compared to 45 cents per pound in the second quarter of 2007.
Industry ethylene prices continued to rise in the third quarter due to
continued strong ethylene operating rates, supply interruptions, and higher
feedstock costs incurred by USGC ethylene producers.

    In the third quarter, co-product sales volumes were 22% higher than the
second quarter, due to strong demand for gasoline blending components and
other energy co-products. The average co-product selling price was down 5%
from last quarter, due primarily to decreases in the selling prices of
chemical co-products benzene and toluene.

    Corunna's average feedstock costs were higher in the third quarter than
the second quarter. While the average WTI crude oil price increased 16%
quarter over quarter, NOVA Chemicals' average crude oil costs increased 9% due
to its use of FIFO accounting. Prices for other feedstocks such as propane,
butane and condensate rose with the price of crude oil.

    Third Quarter 2007 Versus Third Quarter 2006

    The Corunna Olefins segment reported EBITDA of $57 million in the third
quarter of 2007 up from $28 million in the same period one year ago. EBITDA
improved primarily due to lower crude oil feedstock costs, which were 2% lower
compared to the same period one year ago.

    Nine Months Ended Sep. 30, 2007 Versus Nine Months Ended Sep. 30, 2006

    The Corunna Olefins segment reported EBITDA of $157 million for the nine
months ended Sep. 30, 2007 compared to $89 million to the same period last
year. The improvement was due primarily to lower feedstock costs and improved
operations at the Corunna flexi-cracker. Corunna's crude oil costs through the
first nine months of 2007 were 4% lower compared to the same period last year.
Gains from NOVA Chemicals' feedstock purchasing program also contributed to
the reduction in feedstock costs compared to the same period last year.

    Polyethylene

    Third Quarter 2007 Versus Second Quarter 2007

    The Polyethylene segment reported EBITDA of $60 million in the third
quarter of 2007 compared to $50 million in the second quarter. The
quarter-over-quarter EBITDA improvement was largely due to higher selling
prices.

    The North American industry butene liner polyethylene price averaged 67
cents per pound in the third quarter, up 5 cents per pound from the second
quarter. Continued strong export sales and steady domestic demand enabled
producers, including NOVA Chemicals, to operate at high utilization rates and
to increase margins during the quarter.

    NOVA Chemicals' total polyethylene sales volume for the third quarter was
830 million pounds, the same as last quarter. International sales volume again
represented approximately 17% of total sales. Strong international
polyethylene pricing in the third quarter, driven by higher global production
costs and robust demand, continued to support profitable export opportunities.
NOVA Chemicals expects these conditions to continue in the fourth quarter.

    According to data reported by the American Chemistry Council, total
producer polyethylene sales in the third quarter were the second highest in
history. Total sales year to date are 5% higher than the same period last
year. Average producer operating rates were 96% in the third quarter, the same
high level as the second quarter. NOVA Chemicals ended the third quarter with
25 days of polyethylene inventory, in-line with the company's historical
average of 24 days.

    Sales of polyethylene manufactured using Advanced SCLAIRTECH technology
in the third quarter totaled 222 million pounds. For a second consecutive
quarter, rated production and sales exceeded the plant's annual 850 million
pound nameplate capacity. Margins expanded further this quarter from record
levels in the second quarter, in part due to continued market penetration of
higher value products.

    This month, NOVA Chemicals won first prize for "best new product" from
North America's Association of Rotational Molders. The COSMO(TM) container, a
unique collapsible polyethylene portable storage and moving container
measuring 8 feet x 5 feet x 8 feet, was recognized by industry experts. Sales
of high value rotational molding grades have doubled over the past twelve
months, and are expected to continue to grow rapidly as a result of
innovations such as COSMO.

    NOVA Chemicals implemented a 5 cents per pound price increase in the
third quarter and is currently implementing a 4 cents per pound price increase
in October. NOVA Chemicals also announced two additional price increases for
implementation in November : 5 cents per pound, effective Nov. 1 and 6 cents
per pound effective Nov. 15.

    Third Quarter 2007 Versus Third Quarter 2006

    The Polyethylene segment reported EBITDA of $60 million in the third
quarter of 2007 compared to EBITDA of $83 million in the third quarter of
2006. The decline was primarily due to lower average polyethylene selling
prices and higher feedstock costs. The industry average butene liner
polyethylene price was 67 cents per pound in the third quarter of 2007
compared to 69 cents per pound in same period one year ago.

    Nine Months Ended Sep. 30, 2007 Versus Nine Months Ended Sep. 30, 2006

    The Polyethylene segment reported EBITDA of $132 million for the nine
months ended Sep. 30, 2007 compared to $149 million for the same period last
year. The decline was primarily due to lower average sales prices which more
than offset lower ethylene costs. Industry average butene liner polyethylene
prices were 7% lower for the nine months ended Sep. 30, 2007 compared to the
same period last year as prices remained elevated in early 2006 in the
aftermath of Hurricane Katrina.

    NOVA Chemicals' ability to implement announced price increases depends on
many factors that may be beyond its control. See Forward-Looking Information
on page 18.

    PERFORMANCE STYRENICS BUSINESS UNIT

    
    Financial Highlights
    (millions of U.S. Dollars,
     except as noted)
                                   Three Months Ended    Nine Months Ended
                                 ----------------------- -----------------
                                 Sep. 30 June 30 Sep. 30  Sep. 30  Sep. 30
                                  2007    2007    2006     2007     2006
                                 ------- ------- ------- --------- -------
    Revenue                        $117    $115    $111      $332    $316
    EBITDA (1)                       $3     $(6)    $(2)      $(9)    $(3)
    Operating Loss                  $(5)   $(14)    $(5)     $(30)   $(12)

    Sales Volumes (2) (millions
     of pounds)                     120     124     116       350     326


    (1) Net income (loss) before income taxes, other gains and losses,
     interest expense, depreciation and amortization (see Supplemental
     Measures on Page 18).
    (2) Third-party sales.
    

    
    Operating Highlights
    Average Benchmark Raw
     Material Prices (1)
    (U.S. dollars per pound)
                                  Three Month Average   Nine Month Average
                                ----------------------- ------------------
                                Sep. 30 June 30 Sep. 30  Sep. 30   Sep. 30
                                 2007    2007    2006      2007     2006
                                ------- ------- ------- ---------- -------
    Styrene Monomer               $0.68   $0.71   $0.70      $0.68   $0.64


    (1) Source: CMAI Contract Market
    

    Review of Operations

    Third Quarter 2007 Versus Second Quarter 2007

    The Performance Styrenics segment reported EBITDA of $3 million in the
third quarter of 2007 compared to an EBITDA loss of $6 million in the second
quarter.

    The $9 million EBITDA improvement from the second quarter was due
primarily to higher average selling prices for EPS and ARCEL(R), DYLARK, and
ZYLAR performance resins. In addition, costs were lower in the third quarter
as a result of NOVA Chemicals' fixed cost improvements.

    Starting in the fourth quarter of 2007, the results for ZYLAR and NAS
resins will be included in the INEOS NOVA Joint Venture's results. They will
no longer be part of NOVA Chemicals' Performance Styrenics segment.

    During the third quarter, NOVA Chemicals announced EPS price increases
that totaled 4 cents per pound.

    Third Quarter 2007 Versus Third Quarter 2006

    The Performance Styrenics segment reported EBITDA of $3 million in the
third quarter of 2007 compared to an EBITDA loss of $2 million in the third
quarter of 2006. The improvement is largely due to lower operating costs due
to NOVA Chemicals' cost improvement activities taken in the third quarter of
2007.

    Nine Months Ended Sep. 30, 2007 Versus Nine Months Ended Sep. 30, 2006

    The Performance Styrenics segment reported an EBITDA loss of $9 million
for the nine months ended Sep. 30, 2007 compared to an EBITDA loss of $3
million for the nine months ended Sep. 30, 2006. This increase in EBITDA loss
was primarily due to the impact of higher styrene monomer costs which outpaced
EPS and Performance Product price increases. Industry styrene monomer costs
were 6% higher in the first nine months of 2007 compared to the same period
last year.

    NOVA Chemicals' ability to implement announced price increases depends on
many factors that may be beyond its control. See Forward-Looking Information
on Page 18.

    STYRENIX BUSINESS UNIT

    
    Financial Highlights
    (millions of U.S. Dollars,
     except as noted)
                                   Three Months Ended    Nine Months Ended
                                 ----------------------- -----------------
                                 Sep. 30 June 30 Sep. 30  Sep. 30  Sep. 30
                                  2007    2007    2006     2007     2006
                                 ------- ------- ------- --------- -------
    Revenue
    -----------------------------
      Styrene Monomer (1)          $468    $471    $485    $1,403  $1,363
      North American Solid
       Polystyrene (1)              136     144     140       421     381
      European Joint Venture (1)    175     193     179       556     488
      Eliminations                 (252)   (268)   (249)     (763)   (655)
                                 ------- ------- ------- --------- -------
        Total                      $527    $540    $555    $1,617  $1,577

    EBITDA (2)
    -----------------------------
      Styrene Monomer              $(22)    $23      $5       $11     $(1)
      North American Solid
       Polystyrene                   (7)     (7)     (8)      (20)    (21)
      European Joint Venture          1      13       -        29      (7)
      Eliminations (3)                7       -      (1)        7      (1)
                                 ------- ------- ------- --------- -------
        Total                      $(21)    $29     $(4)      $27    $(30)

    Operating Income (Loss)
    -----------------------------
      Styrene Monomer              $(25)    $20     $(9)       $3    $(42)
      North American Solid
       Polystyrene                   (8)     (8)    (13)      (23)    (36)
      European Joint Venture          -      12      (8)       26     (31)
      Eliminations (3)                7       -      (1)        7      (1)
                                 ------- ------- ------- --------- -------
        Total                      $(26)    $24    $(31)      $13   $(110)

    Sales Volumes (millions of
     pounds)
    -----------------------------
      Styrene Monomer (4)           356     307     351     1,042   1,146
      North American Solid
       Polystyrene                  189     202     194       601     567
      European Joint Venture        221     233     234       693     728
                                 ------- ------- ------- --------- -------
        Total                       766     742     779     2,336   2,441


    (1) Before intersegment eliminations between the business units.
    (2) Net income (loss) before income taxes, other gains and losses,
     interest expense, depreciation and amortization (see Supplemental
     Measures on page 18).
    (3) Represents intersegment profit eliminations.
    (4) Third-party sales, including purchased volumes resold. Excludes
     sales to the European Joint Venture.
    

    
    Operating Highlights
    Average Benchmark Prices (1)
    (U.S. dollars per pound,
     unless otherwise noted)
                                  Three Month Average   Nine Month Average
                                ----------------------- ------------------
                                Sep. 30 June 30 Sep. 30  Sep. 30   Sep. 30
                                 2007    2007    2006      2007     2006
                                ------- ------- ------- ---------- -------
    Benchmark Principal
     Products:
    Styrene Monomer (2)           $0.68   $0.71   $0.70      $0.68   $0.64
    Solid PS (2)
      North America               $0.98   $0.99   $0.93      $0.97   $0.87
      Europe                      $0.82   $0.83   $0.73      $0.80   $0.65
    Benchmark Raw Materials:
    Benzene (dollars per gallon)
     (3)                          $3.55   $3.95   $3.71      $3.68   $3.14
    Ethylene (4)                  $0.50   $0.45   $0.51      $0.45   $0.49


    (1) Average benchmark prices, based on CMAI data, do not necessarily
     reflect actual prices realized by NOVA chemicals or any other
     petrochemical company.
    (2) Source: CMAI Contract Market.
    (3) A 10 cents per gallon change in the cost of benzene generally
     results in about a 1 cents per pound change in the variable cost of
     producing styrene monomer. Source of benzene benchmark prices: CMAI.
    (4) Source: Chemical Market Associates, Inc. (CMAI) U.S. Gulf Coast
     (USGC) Net Transaction Price.
    

    Review of Operations

    STYRENIX

    The STYRENIX business unit reported an EBITDA loss of $21 million in the
third quarter of 2007 compared to a positive EBITDA of $29 million in the
second quarter. The quarter-over-quarter change in EBITDA was largely due to
higher feedstock costs - based on NOVA Chemicals' use of FIFO accounting - and
lower selling prices for North American styrene monomer and a seasonally weak
European market.

    Through the first nine months of 2007, the STYRENIX business unit
reported EBITDA of $27 million, a $57 million improvement from the same period
last year. The year-over-year improvement is primarily due to lower costs as a
result of the expiration of the Lyondell contract, NOVA Chemicals'
restructuring actions and improved styrene monomer and European polystyrene
market conditions.

    The third quarter of 2007 is the last quarter that NOVA Chemicals will
report the results for the STYRENIX business unit. Beginning in the fourth
quarter of 2007, NOVA Chemicals will report the results of the INEOS NOVA
Joint Venture, which was expanded to include North American assets and
commenced operations on Oct. 1, 2007.

    Styrene Monomer

    Third Quarter 2007 Versus Second Quarter 2007

    The Styrene Monomer segment reported an EBITDA loss of $22 million in the
third quarter compared to an EBITDA profit of $23 million in the second
quarter. The quarter-over-quarter change was due to higher flow through
benzene feedstock costs and lower styrene monomer selling prices.

    Industry average benzene costs declined 10% in the third quarter, in
contrast, NOVA Chemicals' benzene costs increased 6% due to its use of FIFO
accounting. Styrene monomer prices fell 4% during the quarter as weak market
conditions forced suppliers to lower selling prices in response to lower
benzene costs.

    Third party sales volumes were 16% higher in the third quarter primarily
due to increased export sales to Asia. Continued strength in Asian styrene
monomer pricing relative to North American styrene monomer prices created
profitable export opportunities in the third quarter.

    During the third quarter, NOVA Chemicals announced a styrene monomer
price increase of 4.5 cents per pound, effective Oct. 1 in response to rapidly
rising ethylene costs and a rebound in benzene pricing.

    Third Quarter 2007 Versus Third Quarter 2006

    The Styrene Monomer segment reported an EBITDA loss of $22 million in the
third quarter of 2007 compared to an EBITDA profit of $5 million in the third
quarter of 2006. The change was primarily due to lower average selling prices
that were not fully recovered by lower operating costs related to NOVA
Chemicals' restructuring activities. While industry average benzene prices
were 4% lower in the third quarter of 2007 compared to the same period last
year, NOVA Chemicals' benzene costs were 11% higher due to its use of FIFO
accounting.

    Nine Months Ended Sep. 30, 2007 Versus Nine Months Ended Sep. 30, 2006

    The Styrene Monomer segment reported EBITDA of $11 million for the nine
months ended Sep. 30, 2007, an improvement compared to an EBITDA loss of $1
million for same period last year. The improvement was primarily due to
improved market conditions and lower costs as a result of NOVA Chemicals'
restructuring actions.

    North American Solid Polystyrene

    Third Quarter 2007 Versus Second Quarter 2007

    The North American Solid PS segment reported an EBITDA loss of $7 million
in the third quarter of 2007, the same as the second quarter of 2007.

    North American solid PS sales volume in the third quarter was 6% lower
than the second quarter as customers reduced purchases and consumed inventory
in response to the expectation of falling solid PS prices. Industry average
solid PS prices declined 1 cents per pound during the third quarter.

    During the third quarter, NOVA Chemicals announced a solid PS price
increase of 3 cents per pound, effective Oct. 1.

    Third Quarter 2007 Versus Third Quarter 2006

    The North American Solid PS segment reported an EBITDA loss of $7 million
in the third quarter of 2007, compared to an EBITDA loss of $8 million in the
third quarter of 2006. Reduced costs related to NOVA Chemicals' restructuring
activities were more than offset by lower solid PS gross margins.

    Nine Months Ended Sep. 30, 2007 Versus Nine Months Ended Sep. 30, 2006

    The North American Solid PS segment reported an EBITDA loss of $20
million for the nine months ended Sep. 30, 2007, compared to an EBITDA loss of
$21 million for the nine months ended Sep. 30, 2006. Higher polymer selling
price and lower operating costs were more than offset by higher feedstock
costs.

    European Joint Venture

    Third Quarter 2007 Versus Second Quarter 2007

    NOVA Chemicals' 50% share of the European Joint Venture provided EBITDA
of $1 million in the third quarter of 2007, down from EBITDA of $13 million in
the second quarter of 2007.

    The quarter-over-quarter change in results was largely due to lower EPS
and solid PS selling prices and sales volume. Seasonally weaker demand in
Europe and the expectation of a continual decline in polymer prices motivated
customers to reduce purchases and consume inventory.

    Third Quarter 2007 Versus Third Quarter 2006

    The European Joint Venture segment provided EBITDA of $1 million in the
third quarter of 2007 compared to break even in the third quarter of 2006.
Results improved slightly from the same period one year ago as cost reductions
resulting from the realization of synergies were partially offset by a decline
in margins.

    Nine Months Ended Sep. 30, 2007 Versus Nine Months Ended Sep. 30, 2006

    The European Joint Venture segment provided EBITDA of $29 million for the
nine months ended Sep. 30, 2007 compared to an EBITDA loss of $7 million for
the nine months ended Sep. 30, 2006. This improvement was due to cost
reductions resulting from the realization of synergies and better margins.

    NOVA Chemicals' ability to implement announced price increases depends on
many factors that may be beyond its control. See Forward-Looking Information
on Page 18.

    
    CORPORATE
    (millions of U.S. dollars)
                                   Three Months Ended    Nine Months Ended
                                 ----------------------- -----------------
                                 Sep. 30 June 30 Sep. 30  Sep. 30  Sep. 30
                                  2007    2007    2006     2007     2006
                                 ------- ------- ------- --------- -------
    Before-Tax Corporate Items:
    Corporate operating costs(1)   $(16)   $(26)   $(26)     $(69)   $(85)
    Stock-based compensation and
     profit sharing (2)              (6)     (6)     (8)      (30)    (15)
    Mark-to-market feedstock
     derivatives (3)                  9      (1)    (17)       34     (29)
    Non-cash insurance charge         -       -     (19)        -     (19)
    Restructuring                     -     (10)   (109)      (10)   (125)
                                 ------- ------- ------- --------- -------
    Operating loss                 $(13)   $(43)  $(179)     $(75)  $(273)

    Add back:
       Corporate depreciation         2       2       2         6       6
       Restructuring                  -      10     109        10     125
                                 ------- ------- ------- --------- -------
    Adjusted EBITDA                 (11)    (31)    (68)      (59)   (142)
                                 ------- ------- ------- --------- -------


    (1) Beginning in the first quarter of 2007, NOVA Chemicals no longer
     allocates interest, taxes or corporate operating costs to the
     business segments. Prior period comparative amounts have been revised
     to reflect this change. Operating costs include corporate
     depreciation.

    (2) NOVA Chemicals has two cash-settled, stock-based incentive
     compensation plans that are marked to market with changes in the
     value of the common stock price. In November 2005, NOVA Chemicals
     entered into a hedging arrangement that effectively neutralizes the
     mark-to-market impact on the stock-based incentive compensation
     plans. Stock-based compensation also includes the amount expensed
     related to the fair value of stock options earned by employees during
     the period. In addition, NOVA Chemicals maintains a profit sharing
     program available to most employees based on the achievement of
     shareholder return on equity targets.

    (3) NOVA Chemicals is required to record on its balance sheet the
     market value of its open derivative positions. The gain or loss
     resulting from changes in the market value of these derivatives is
     recorded as earnings each period. These mark-to-market adjustments
     are recorded as part of Corporate results until the positions are
     realized. Once realized, any income effects are recorded in business
     results.
    

    Corporate Operating Costs

    The corporate operating costs of $16 million in the third quarter of 2007
were $10 million lower than the second quarter of 2007 and the third quarter
of 2006 primarily due to one-time lower employee retirement accruals and cost
savings related to NOVA Chemicals' restructuring activities. The corporate
operating costs for the nine months ended Sep. 30, 2007 are lower than the
same period in the prior year for the same reasons.

    Stock-based Compensation and Profit Sharing

    In the third quarter of 2007, stock-based compensation costs were $6
million, the same as in the second quarter of 2007. Year-to-date, stock-based
compensation costs were $15 million higher than the same period last year,
primarily due to a $10 million charge recorded in the first quarter of 2007
related to the acceleration of stock-based compensation expenses for
retirement eligible employees. See the last paragraph on page 25 for more
details.

    Mark-to-Market Feedstock Derivatives

    The mark-to-market impact of NOVA Chemicals' outstanding feedstock
derivatives was a $9 million ($6 million after-tax) gain in the third quarter
of 2007, compared to a loss of $1 million (before- and after-tax) in the
second quarter. The value of these positions, which were initiated as part of
Corunna's feedstock purchasing program, appreciated in the third quarter as
forward propane and butane prices increased relative to crude oil prices. The
third quarter gain compares to a $17 million ($11 million after-tax) loss in
the third quarter of 2006.

    Year-to-date, the mark-to-market feedstock derivative impact improved $63
million over the prior year as a result of increases in forward propane and
butane prices relative to crude oil. Corunna's feedstock purchasing program
was expanded as a result of changes made at the Corunna flexi-cracker that
increased feedstock flexibility.

    Non-cash Insurance Charge

    There were no non-cash insurance charges recorded in 2007.

    In the third quarter of 2006, NOVA Chemicals accrued $19 million ($13
million after-tax) related to its share of estimated incremental costs in the
insurance pools in which it participates. NOVA Chemicals is one of many
participants in OIL and sEnergy - two mutual insurance companies formed to
insure against catastrophic risks. Due to losses incurred by OIL and sEnergy
that are related to participants other than NOVA Chemicals, NOVA Chemicals was
required to pay higher premiums. The third quarter 2006 charges are related to
sEnergy, which is in the process of closing operations.

    Restructuring

    There were no restructuring charges recorded in the third quarter of
2007. Refer to Note 3 on page 27 for details related to restructuring charges
for all prior periods presented.

    
    Capitalization
    (millions of U.S. dollars, except as noted)


                                               Sep. 30   June 30   Dec. 31
                                                2007      2007      2006
                                               ------- ----------- -------
                                                       (restated -
                                                       see Note 7)

    Current debt (1) (2)                         $314        $236    $263
    Less: restricted cash and other assets (3)    (69)        (69)    (72)
                                               ------- ----------- -------
      Net current debt (4)                        245         167     191
    Long-term debt (2) (3)                      1,656       1,642   1,582
    Less: cash and cash equivalents              (121)       (109)    (53)
                                               ------- ----------- -------

    Total debt, net of cash, cash equivalents,
     and restricted cash and other assets       1,780       1,700   1,720

    Total shareholders' equity (5) (6) (7) (8)    961         778     546
                                               ------- ----------- -------

    Total capitalization (9)                   $2,741     $ 2,478  $2,266
                                               ------- ----------- -------

    Net debt to total capitalization (10)        64.9%       68.6%   75.9%


    (1) Current debt includes the $198 million preferred shares of NOVA
     Chemicals' subsidiary due Oct. 31, 2008. Current debt also includes
     the current debt related to the Joffre co-generation facility joint
     venture, the current portion of the Corunna compressor capital lease,
     the secured revolver and bank loans.
    (2) Maturity dates for NOVA Chemicals' current and long-term debt
     range from October 2008 to August 2028.
    (3) As a result of adopting new Canadian GAAP pronouncements under
     CICA Section 3855 on Jan. 1, 2007, long-term debt is required to be
     initially measured at fair value and subsequently measured at
     amortized cost. As a result, $7 million of deferred debt discount and
     issuance costs that were reported in Restricted cash and other assets
     prior to Jan. 1, 2007, on the Consolidated Balance Sheets were
     reclassified in the first quarter, on a prospective basis, and are
     now reported as a reduction of the respective debt obligations.
    (4) Net current debt equals current debt less restricted cash and
     other assets (see Supplemental Measures on page 18).
    (5) Common shares outstanding on Oct. 19, 2007 were 83,051,189.
    (6) A total of 4,070,156 stock options to purchase common shares of
     NOVA Chemicals were outstanding to officers and employees on Oct. 19,
     2007, and 4,072,006 were outstanding on Sep. 30, 2007. A total of
     3,116,529 common shares were reserved but unallocated at Sep. 30,
     2007. A total of 13 million common shares were initially reserved for
     issuance under the Option Plan.
    (7) A total of 47,800 shares were reserved for the Directors' Share
     Compensation Plan.
    (8) In April 2005, NOVA Chemicals' shareholders reconfirmed a
     shareholder rights plan expiring May 2009 where one right was issued
     for each outstanding common share.
    (9) Total capitalization includes shareholders' equity and total debt,
     net of cash, cash equivalents, and restricted cash and other assets
     (see Supplemental Measures on page 18).
    (10) Net debt to total capitalization is equal to total debt, net of
     cash, cash equivalents, and restricted cash and other assets, divided
     by total common shareholders' equity plus net debt (see
     Capitalization table above and Supplemental Measures on page 18).
    

    
    Senior Debt Ratings (1)
                                                     Senior Unsecured Debt
                                                     ---------------------
    DBRS                                                 BB (negative)
    Fitch Ratings                                        BB- (stable)
    Moody's                                             Ba3 (negative)
    Standard & Poor's                                     B+ (stable)


    (1) Credit ratings are not recommendations to purchase, hold or sell
     securities and do not comment on market price or suitability for a
     particular investor. There is no assurance that any rating will
     remain in effect for any given period of time or that any rating will
     not be revised or withdrawn entirely by a rating agency in the
     future.
    

    
    Funds Flow and Changes in
     Cash and Debt
    (millions of U.S. dollars)
    The following table shows
     major sources and uses of
     cash.
                                  Three Months Ended     Nine Months Ended
                              -------------------------- -----------------
                              Sep. 30, June 30, Sep. 30, Sep. 30, Sep. 30,
                                2007     2007     2006     2007     2006
                              -------- -------- -------- -------- --------
    Operating income (1)         $188     $150      $13     $439     $157
    Depreciation and
     amortization                  63       60       75      177      224
    Restructuring charges           -       10      109       10      125
                              -------- -------- -------- -------- --------
    Adjusted EBITDA (1)           251      220      197      626      506
    Interest expense (net)        (47)     (41)     (43)    (130)    (125)
    Restructuring charges           -      (10)     (62)     (10)     (78)
    Unrealized (gain) loss on
     derivatives                   (9)       1       17      (34)      29
    Stock option expense            2        -        1        2        8
    Current tax expense           (11)     (10)     (27)     (46)     (82)
                              -------- -------- -------- -------- --------
    Funds from operations         186      160       83      408      251
    Operating working capital
     increase and other          (201)     (45)     (57)    (284)      (1)
                              -------- -------- -------- -------- --------
    Cash flow (used in) from
     operating activities         (15)     115       26      124      250
    Capital expenditures (net
     of proceeds on sale of
     assets)                      (34)     (24)     (47)     (94)    (150)
    Turnaround costs               (9)     (27)     (18)     (39)     (38)
    Dividends paid                 (8)      (8)      (7)     (23)     (22)
    Change in accounting
     policy for financial
     instruments (see Note 1)       -        -        -       13        -
    Foreign exchange on long-
     term debt and other          (13)     (24)      (1)     (37)     (11)
                              -------- -------- -------- -------- --------
    Total change in cash and
     debt                        $(79)     $32     $(47)    $(56)     $29
                              -------- -------- -------- -------- --------

    Increase (decrease) in
     cash and cash
    equivalents                   $12      $22      $17      $68     $(56)
    (Increase) decrease in
     debt(2)                      (91)      10      (64)    (124)      85
                              -------- -------- -------- -------- --------
    Total change in cash and
     cash equivalents and debt   $(79)     $32     $(47)    $(56)     $29
                              -------- -------- -------- -------- --------
    

    
    (1) See Consolidated Statements of Net Income (Loss) on page 19 and
     Supplemental Measures on page 18.
    (2) Includes foreign exchange changes and excludes reduction in
     carrying amount resulting from the application of new Canadian GAAP
     pronouncements (see Note 1 to the Consolidated Financial Statements).
    

    NOVA Chemicals' funds from operations were $186 million for the third
quarter of 2007, up from $160 million in the second quarter. Cash flow used in
operating activities was $15 million in the third quarter compared to $115
cash flow generated from operating activities in the second quarter of 2007.
The third quarter increase in operating working capital was attributable
roughly 50% to price and 50% to volume. Polyethylene pricing was up 9% causing
a rise in receivables while inventory volumes were down due to strong demand
and active inventory management. Accounts payable balances dropped to low
levels as natural gas prices declined 23% quarter-over-quarter and NOVA
Chemicals purchased less ethane.

    NOVA Chemicals measures the effectiveness of its working capital
management through Cash Flow Cycle Time (CFCT). See Supplemental Measures
below. CFCT was 37 days as of Sep. 30, 2007, and 32 days as of June 30, 2007
primarily due to higher sales volume and lower quarter-end accounts payable.

    Financing

    NOVA Chemicals has four revolving credit facilities aggregating $590
million. The amounts and expiration dates of these facilities are as follows:

    --  $100 million on Dec. 31, 2007

    --  $ 65 million on Mar. 20, 2010

    --  $325 million on June 30, 2010, and

    --  $100 million on Mar. 20, 2011.

    As of Sep. 30, 2007, NOVA Chemicals had utilized $268 million of the
facilities (of which $52 million was in the form of letters of credit).

    NOVA Chemicals amended its financial covenants governing these credit
facilities to allow for an exemption of any write-down of the STYRENIX assets
up to $950 million, of which $860 million occurred in the fourth quarter of
2006. In addition, the debt-to-capitalization ratio financial covenant was
raised from 55% to 60%. These amendments are in effect for the period Dec. 31,
2006 to Mar. 30, 2008. Using the covenant methodology in the relevant
revolving credit facilities, the debt-to-capitalization ratio was 50% at Sep.
30, 2007. NOVA Chemicals continues to comply with all financial covenants
under the applicable facilities.

    NOVA Chemicals also has $350 million accounts receivable securitization
programs that expire on June 30, 2010. As of Sep. 30, 2007 and June 30, 2007,
$291 million and $307 million, respectively, was sold under the accounts
receivable securitization programs.

    The European Joint Venture has a EUR 120 million accounts receivable
securitization program that expires in November 2011. As of Sep. 30, 2007 and
June 30, 2007, NOVA Chemicals' 50% share, EUR 36 million and EUR 44 million,
respectively, was sold under the accounts receivable securitization program.

    The total return swap entered into in connection with the Series A
preferred stock of NOVA Chemicals' subsidiary, NOVA Chemicals Inc., was
scheduled to terminate on Oct. 31, 2007. However, in October 2007, NOVA
Chemicals and the counterparty agreed to extend the term until Oct. 31, 2008.
See page 61 of NOVA Chemicals' Annual Report for a more detailed discussion of
the total return swap.

    Feedstock Derivative Positions

    NOVA Chemicals maintains a derivatives program to manage risk associated
with its feedstock purchases. In the third quarter of 2007, NOVA Chemicals
recorded a net after-tax loss of $3 million on realized positions compared to
a net after-tax gain of $3 million in the second quarter.

    Mark-to-market adjustments, related to the change in the value of open
feedstock positions, are recorded as part of Corporate results until the
positions are realized. Once realized, any income effects are recorded in
business results. See page 12 for more details.

    FIFO Impact

    NOVA Chemicals uses the first-in, first-out (FIFO) method of valuing
inventory. Most of NOVA Chemicals' competitors use the last-in, first-out
(LIFO) method. Because NOVA Chemicals uses FIFO, a portion of the second
quarter 2007 feedstock purchases flowed through the Consolidated Statements of
Net Income (Loss) in the third quarter of 2007.

    NOVA Chemicals estimates that earnings would have been about $17 million
lower (after-tax) in the third quarter had it used the LIFO method of
accounting. The FIFO impact was due primarily to a sharp increase in crude oil
feedstock costs in September, partially offset by a sharp decrease in benzene
prices.

    NOVA Chemicals' share price on the New York Stock Exchange (NYSE) rose to
$38.60 at Sep. 30, 2007 from $35.57 at June 30, 2007. NOVA Chemicals' share
value increased 9% for the quarter ending Sep. 30, 2007 on the NYSE and 1% on
the Toronto Stock Exchange (TSX). Peer chemical companies' share values
increased 5% on average and the S&P Chemicals Index increased 8%. The S&P/TSX
Composite Index was up 1% and the S&P 500 was up 2% in the third quarter of
2007 compared to the second quarter of 2007. As of Oct. 23, 2007, NOVA
Chemicals' share price was $38.71, the same as Sep. 30, 2007. The S&P
Chemicals Index was flat during the same period.

    In the third quarter, approximately 42% of trading in NOVA Chemicals'
shares took place on the TSX and 58% of trading took place on the NYSE and
other U.S. markets.

    
    Third Quarter Trading
     Volumes                    Millions of Shares % of Float % of Trading
    --------------------------- ------------------ ---------- ------------
    Toronto Stock Exchange             31.1               38%          42%
    Consolidated U.S. Trading
     Volumes                           43.4               52%          58%
                                ------------------ ---------- ------------
    Total                              74.5               90%         100%
                                ------------------ ---------- ------------
    

    
                             INVESTOR INFORMATION

    For inquiries on stock-related matters including dividend payments,
     stock transfers and address changes, contact NOVA Chemicals toll-free
     at 1-800-661-8686 or e-mail to shareholders@novachem.com

    Contact Information
    Phone: (403) 750-3600 (Canada) or (412) 490-4000 (United States)
    Internet: www.novachemicals.com         E-Mail: invest@novachem.com

    NOVA Chemicals Corporation
    1000 Seventh Avenue S.W., P.O. Box 2518
    Calgary, Alberta, Canada T2P 5C6

    If you would like to receive a shareholder information package, please
     contact us at (403) 750-3600 or (412) 490-4000 or via e-mail at
     publications@novachem.com

    We file additional information relating to NOVA Chemicals, including
     our Annual Information Form, with Canadian securities administrators.
     This information can be accessed through the System for Electronic
     Document Analysis and Retrieval (SEDAR), at www.sedar.com. This same
     information is filed with the U.S. Securities and Exchange Commission
     and can be accessed via their Electronic Data Gathering Analysis and
     Retrieval System (EDGAR) at www.sec.gov/edgar.shtml
    ----------------------------------------------------------------------
    

    
    Transfer Agent and Registrar
    CIBC Mellon Trust Company
    600 The Dome Tower, 333 Seventh Avenue S.W.
    Calgary, Alberta, Canada T2P 2Z1

    Phone:      (403) 232-2400 / 1-800-387-0825
    Fax:        (403) 264-2100
    Internet:   www.cibcmellon.com


    Share Information
    NOVA Chemicals' trading symbol on the New York and Toronto Stock
     Exchanges is NCX.
    

    Advanced SCLAIRTECH(TM) is a trademark of NOVA Chemicals.

    ARCEL(R) and DYLARK(R) are registered trademarks of NOVA Chemicals Inc.

    COSMO(TM )is a trademark of NOVA Chemicals Inc.

    NAS(R) and ZYLAR(R) are registered trademarks of INEOS NOVA.

    SCLAIR(R) is a registered trademark of NOVA Chemicals Corporation in
Canada and of NOVA Chemicals (International) S.A. elsewhere; authorized
use/utilisation autorissee.

    SURPASS(R) is a registered trademark of NOVA Chemicals Corporation in
Canada and of NOVA Chemicals (International) S.A. elsewhere.

    
    CHANGES IN NET INCOME (LOSS)
    (millions of U.S. dollars)
                                       Q3 2007     First Nine Months 2007
                                     Compared to    Compared to First Nine
                                   ---------------
                                   Q2 2007 Q3 2006       Months 2006
                                   ------- ------- -----------------------
    Higher operating margin (1)        $9     $30                    $101
    (Higher) lower research and
     development                       (1)      -                       1
    Lower selling, general and
     administrative                    23      24                      18
    Lower restructuring charges        10     109                     115
    (Higher) lower depreciation
     and amortization                  (3)     12                      47
    Higher interest expense            (6)     (4)                     (5)
    Higher other gains and losses       2       2                       -
    Higher income tax expense         (17)    (52)                   (134)
                                   ------- ------- -----------------------
    Increase in net income (loss)     $17    $121                    $143
                                   ------- ------- -----------------------


    (1) Operating margin equals revenue less feedstock and operating
     costs.
    

    Operating margins in the third quarter of 2007 were $9 million higher
than second quarter primarily due to margin expansion in ethylene and
polyethylene.

    Selling, general and administrative (SG&A) costs in the third quarter
were $23 million and $24 million, respectively, lower than the second quarter
of 2007 and the third quarter of 2006 and the SG&A costs in the first nine
months of 2007 were $18 million lower than the first nine months of 2006. The
decrease in SG&A was related to a combination of factors: one-time
curtailment/special termination benefits of $4 million as a result of pension
plan amendments (see Note 2 on page 26); lower actual versus estimated benefit
costs of $4 million; restructuring savings of $3 million; a reduction of
insurance costs of approximately $3 million; and a reduction in pension
accruals of $2 million.

    Refer to Note 3 on page 27 for details related to the restructuring
charges.

    Depreciation and amortization in the third quarter of 2007 was $3 million
higher than the second quarter of 2007 primarily due to the completion of a
turnaround at Joffre's second ethylene plant in June 2007 and foreign currency
impact. Depreciation and amortization in the third quarter of 2007 and the
first nine months of 2007 was $12 million and $47 million, respectively, lower
than the comparable three and nine-month periods in 2006 as a result of
writing down the STYRENIX assets in late 2006 in connection with NOVA
Chemicals' restructuring actions.

    Interest expense in the third quarter of 2007 was $6 million and $4
million higher compared to the second quarter of 2007 and the third quarter of
2006, respectively, and interest expense was $5 million higher for the first
nine months of 2007 compared with the first nine months of 2006. The increase
in interest expense relates to the increase in the use of the revolving credit
facilities and the increase in the LIBOR rate.

    The increase in income tax expense in the third quarter of 2007 compared
to the second quarter of 2007 and the third quarter of 2006 relates to the
increase in income and an increase in the valuation allowance. Higher income
tax expense for the nine month period ended Sep. 30, 2007 compared to the nine
month period ended Sep. 30, 2006 is due to the following: an income tax
benefit of $60 million recorded in the second quarter of 2006 to reflect the
Canadian federal and Alberta provincial income tax rate reductions, partially
offset by tax rate reductions of $12 million in 2007; an increase in income;
and an increase in the valuation allowance.

    Supplemental Measures

    In addition to providing measures in accordance with Canadian Generally
Accepted Accounting Principles (GAAP), NOVA Chemicals presents certain
supplemental measures as follows:

    --  Adjusted EBITDA - This measure, defined on page 2, is provided to
assist investors in determining the ability of NOVA Chemicals to generate cash
from operations.

    --  After-tax return on capital employed - defined on page 3.

    --  Average capital employed - defined on page 3.

    --  Cash Flow Cycle Time - This measures working capital from operations
(excluding the European Joint Venture) in terms of the number of day's sales,
calculated as working capital from operations divided by average daily sales.
This metric helps to determine which portion of changes in working capital
results from factors other than price movements. See page 14.

    --  EBITDA - This measure, defined on page 5, is provided to assist
investors in determining the ability of NOVA Chemicals to generate cash from
operations.

    --  EBITDA from the Businesses - This measure, defined on page 2,
highlights the ongoing performance of the business units without considering
one-time charges, events or other items which are not driven by the business
units.

    --  Funds from operations - See Funds Flow and Changes in Cash and Debt
on page 14 for a reconciliation to operating income.

    --  Net current debt - defined on page 13.

    --  Net debt to total capitalization - defined on page 13.

    --  Total capitalization - defined on page 13.

    These measures do not have any standardized meaning prescribed by GAAP
and are therefore unlikely to be comparable to similar measures presented by
other companies.

    Forward-Looking Information

    This news release contains forward-looking statements with respect to
NOVA Chemicals, its subsidiaries and affiliated companies. By their nature,
forward-looking statements require NOVA Chemicals to make assumptions and are
subject to inherent risks and uncertainties. There is significant risk that
predictions, forecasts, conclusions and projections will not prove to be
accurate, that NOVA Chemicals' assumptions may not be correct and that actual
results may differ materially from such predictions, forecasts, conclusions or
projections. Forward-looking statements for the time periods beyond 2007
involve longer-term assumptions and estimates than forward-looking statements
for 2007 and are consequently subject to greater uncertainty. NOVA Chemicals
cautions readers of this news release not to place undue reliance on its
forward-looking statements as a number of factors could cause actual results,
conditions, actions or events to differ materials from the targets,
expectations, estimates or intentions expressed in the forward-looking
statements.

    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-looking
statements. Specific forward-looking statements contained in this news release
include, among others, statements regarding: NOVA Chemicals' beliefs that very
strong conditions for its Olefins/Polyolefins business will continue into the
fourth quarter and beyond; NOVA Chemicals' expectations and beliefs with
respect to its expanded joint venture with INEOS, including (i) the belief
that the combination of the formation of the expanded joint venture and the
agreement with Sterling, assuming regulatory approval is obtained, creates a
strong foundation for further cost reductions in NOVA Chemicals' styrenics
business, (ii) the expectation that the expanded joint venture will have
annual revenues of approximately $3.8 billion, and (iii) the initial target of
$80 million per year of additional cost reductions and EBITDA improvement,
including $30 million of increased annual EBITDA due to increased sales and
lower operating costs by shifting Sterling's production to the more efficient
joint venture styrene monomer sites; NOVA Chemicals' expectation that market
conditions in Europe will return from a weak summer holiday period; NOVA
Chemicals' expectation that profitable export opportunities for polyethylene
will continue in the fourth quarter; and NOVA Chemicals' expectation that
sales of high value rotational molding grades will continue to grow rapidly.
With respect to forward-looking statements contained in this news release,
NOVA Chemicals has made assumptions regarding, among other things: future oil,
natural gas and benzene prices; its ability to obtain raw materials; its
ability to market products successfully to its anticipated customers; the
impact of increasing competition; and its ability to obtain financing on
acceptable terms. Some of the risks that could affect NOVA Chemicals' future
results and could cause results to differ materially from those expressed in
the forward-looking statements 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; currency exchange rate
fluctuations; starting up and operating facilities using new technology;
realizing synergy and cost savings targets; NOVA Chemicals' ability to
implement its business strategies; meeting time and budget targets for
significant capital investments; avoiding unplanned facility shutdowns;
safety, health, and environmental risks associated with the operation of
chemical plants and marketing of chemical products, including transportation
of these products; public perception of chemicals and chemical end-use
products; the impact of competition; changes in customer demand, including
customer acceptance of NOVA Chemicals' Performance Products; changes in, or
the introduction of new laws and regulations relating to NOVA Chemicals'
business, including environmental, competition and employment laws; loss of
the services of any of NOVA Chemicals' executive officers; uncertainties
associated with the North American, South American, European, and Asian
economies, terrorist attacks, severe weather events, and other risks detailed
from time to time in the publicly filed disclosure documents and securities
commission reports of NOVA Chemicals and its subsidiaries or affiliated
companies.

    Implementation of announced price increases depends on many factors,
including market conditions, the supply/demand balance for each particular
product and feedstock costs. Price increases have varying degrees of success.
They are typically phased in and can differ by product or market. There can be
no assurances that any announced price increases will be successful or will be
realized within the anticipated time frame. In addition, benchmark price
indices sometimes lag price increase announcements due to the timing of
publication.

    NOVA Chemicals' forward-looking statements are expressly qualified in
their entirety by this cautionary statement. In addition, the forward-looking
statements are made only as of the date of this news release, and except as
required by applicable law, NOVA Chemicals undertakes no obligation to
publicly update these forward-looking statements to reflect new information,
subsequent events or otherwise.

    
    Summary Quarterly Financial Information
    (millions of U.S. Dollars, except per share amounts)

                                                    Three Months Ended
                                                 -------------------------
                                                          2007
                                                 -----------------------
                                                 Sep. 30 June 30 Mar. 31
                                                 ------- ------- -------

    Revenue                                       $1,755  $1,676   1,506
    Operating income (loss)                         $188    $150     101
    Net income (loss)                                $97     $80      44
    Earnings (loss) per share
      - basic                                      $1.17   $0.97    0.53
      - diluted                                    $1.16   $0.96    0.53
    Weighted-average common shares outstanding
     (millions)
      - basic                                       83.0    82.9    82.7
      - diluted                                     83.8    83.7    83.5

    Summary Quarterly Financial Information
    (millions of U.S. Dollars, except per share amounts)

                                     Three Months Ended
                  --------------------------------------------------------
                                      2006                        2005
                  -------------------------------------------- -----------
                   Dec. 31   Sep. 30     June 30     Mar. 31     Dec. 31
                           (restated - (restated - (restated - (restated -
                           see Note 1) see Note 1) see Note 1) see Note 1)
                  -------- ----------- ----------- ----------- -----------

    Revenue         1,635       1,712        1,619      1,553       1,433
    Operating
     income (loss)   (837)         13          107         37         (76)
    Net income
     (loss)         $(781)        (24)         106         (4)        (66)
    Earnings
     (loss) per
     share
      - basic       (9.46)      (0.29)        1.28      (0.05)      (0.80)
      - diluted     (9.46)      (0.29)        1.27      (0.05)      (0.80)
    Weighted-
     average
     common shares
     outstanding
     (millions)
      - basic        82.6        82.6         82.5       82.5        82.4
      - diluted      82.6        82.6         83.2       82.5        82.4
    

    
    CONSOLIDATED FINANCIAL STATEMENTS
    Consolidated Statements of Net Income (Loss)
    (unaudited, millions of U.S. dollars, except per
     share amounts)

                               Three Months Ended       Nine Months Ended
                           --------------------------- -------------------
                           Sep. 30 June 30   Sep. 30   Sep. 30   Sep. 30
                            2007    2007      2006      2007      2006
                           ------- ------- ----------- ------- -----------
                                           (restated -         (restated -
                                           see Note 1)         see Note 1)
    Revenue                $1,755  $1,676      $1,712  $4,937      $4,884
                           ------- ------- ----------- ------- -----------

    Feedstock and operating
     costs                  1,461   1,391       1,448   4,133       4,181
    Research and
     development               13      12          13      37          38
    Selling, general and
     administrative            30      53          54     141         159
    Restructuring charges
     (Note 3)                   -      10         109      10         125
    Depreciation and
     amortization              63      60          75     177         224
                           ------- ------- ----------- ------- -----------
                            1,567   1,526       1,699   4,498       4,727
                           ------- ------- ----------- ------- -----------
    Operating income          188     150          13     439         157
                           ------- ------- ----------- ------- -----------

    Interest expense (net)
     (Note 4)                 (47)    (41)        (43)   (130)       (125)
    Other gains and losses
     (net)                      1      (1)         (1)      1           1
                           ------- ------- ----------- ------- -----------
                              (46)    (42)        (44)   (129)       (124)
                           ------- ------- ----------- ------- -----------
    Income (loss) before
     income taxes             142     108         (31)    310          33
    Income tax expense
     (recovery) (Note 5)       45      28          (7)     89         (45)
                           ------- ------- ----------- ------- -----------
    Net income (loss)         $97     $80        $(24)   $221         $78
                           ------- ------- ----------- ------- -----------

    Earnings (loss) per
     share (Note 6)
      - basic               $1.17   $0.97      $(0.29)  $2.67       $0.95
      - diluted             $1.16   $0.96      $(0.29)  $2.65       $0.94
    

    Notes to the Consolidated Financial Statements appear on pages 24 to 33.

    
    Consolidated Statements of Comprehensive Income
     (Loss)
    (unaudited, millions of U.S. dollars)

                                 Three Months Ended      Nine Months Ended
                             --------------------------- -----------------
                             Sep. 30   June 30   Sep. 30  Sep. 30  Sep. 30
                              2007      2007      2006     2007     2006
                             ------- ----------- ------- --------- -------
                                     (restated -
                                     see Note 7)
    Net income (loss)           $97          $80   $(24)     $221      $78
    Other comprehensive
     income (loss):
      Unrealized loss on
       available for sale
       securities, net of tax    (1)           -      -        (1)       -
      Unrealized gain on
       translation of self-
       sustaining foreign
       operations                91           93     17       210       90
                             ------- ----------- ------- --------- -------
    Comprehensive income
     (loss)                    $187         $173    $(7)     $430     $168
                             ------- ----------- ------- --------- -------
    

    
    Consolidated Balance Sheets
    (unaudited, millions of U.S. dollars)

                                               Sep. 30, 2007 Dec. 31, 2006
                                               ------------- -------------
    Assets
    Current assets
      Cash and cash equivalents                        $121           $53
      Restricted cash and other assets                   69            72
      Accounts receivable                               587           496
      Inventories                                       841           669
                                               ------------- -------------
                                                      1,618         1,290

    Investments and other assets                        108           113
    Property, plant and equipment, net                3,057         2,719
                                               ------------- -------------

                                                     $4,783        $4,122
                                               ------------- -------------

    Liabilities and Shareholders' Equity
    Current liabilities
      Bank loans                                         $2            $1
      Accounts payable and accrued liabilities          906           926
      Long-term debt due within one year                312           262
                                               ------------- -------------
                                                      1,220         1,189
    Long-term debt                                    1,656         1,582
    Future income taxes                                 602           435
    Deferred credits and long-term liabilities          344           370
                                               ------------- -------------
                                                      3,822         3,576
                                               ------------- -------------

    Shareholders' equity
      Common shares                                     505           497
      Contributed surplus                                26            25
      Accumulated other comprehensive income            587           378
      Deficit                                          (157)         (354)
                                               ------------- -------------
                                                        961           546
                                               ------------- -------------

                                                     $4,783        $4,122
                                               ------------- -------------
    

    Notes to the Consolidated Financial Statements appear on pages 24 to 33.

    
    Consolidated Statements of Cash Flows
    (unaudited, millions of U.S. dollars)

                               Three Months Ended       Nine Months Ended
                           --------------------------- -------------------
                           Sep. 30 June 30   Sep. 30   Sep. 30   Sep. 30
                            2007    2007      2006      2007      2006
                           ------- ------- ----------- ------- -----------
    Operating activities                   (restated -         (restated -
                                           see Note 1)         see Note 1)
      Net income (loss)       $97     $80        $(24)   $221         $78
      Depreciation and
       amortization            63      60          75     177         224
      Future income tax
       expense (recovery)      34      18         (34)     43        (134)
      Unrealized (gain)
       loss on derivatives     (9)      1          17     (34)         29
      Other (gains) losses     (1)      1           1      (1)         (1)
      Stock option expense      2       -           1       2           8
      Asset write-downs         -       -          47       -          47
      Changes in non-cash
       working capital       (178)    (37)         (7)   (247)        (42)
      Changes in operating
       non-current assets
       and liabilities        (23)     (8)        (50)    (37)         41
                           ------- ------- ----------- ------- -----------
      Cash flow (used in)
       from operating
       activities
                              (15)    115          26     124         250
                           ------- ------- ----------- ------- -----------

    Investing activities
      Proceeds on asset
       sales and other
       capital transactions     1       -           -       2           2
      Property, plant and
       equipment additions    (35)    (24)        (47)    (96)       (152)
      Turnaround costs,
       long-term
       investments and
       other assets            (9)    (27)        (18)    (39)        (38)
                           ------- ------- ----------- ------- -----------
      Cash flow used in
       investing activities   (43)    (51)        (65)   (133)       (188)
                           ------- ------- ----------- ------- -----------

    Financing activities
      Increase in current
       bank loans               -       -           1       -           -
      Long-term debt
       additions                -       -           -       -           4
      Long-term debt
       repayments              (1)     (7)         (2)    (12)       (304)
      Long-term debt
       -increase (decrease)
       in revolving debt       76     (26)         65     107         203
      Options retired for
       cash                    (1)     (2)         (1)     (3)         (1)
      Common shares issued      4       1           -       8           2
      Common share
       dividends               (8)     (8)         (7)    (23)        (22)
                           ------- ------- ----------- ------- -----------
      Cash flow from (used
       in) financing
       activities              70     (42)         56      77        (118)
                           ------- ------- ----------- ------- -----------

    Increase (decrease) in
     cash and cash
     equivalents               12      22          17      68         (56)
    Cash and cash
     equivalents, beginning
     of period                109      87          93      53         166
                           ------- ------- ----------- ------- -----------

    Cash and cash
     equivalents, end of
     period                  $121    $109        $110    $121        $110
                           ------- ------- ----------- ------- -----------

    Cash tax payments         $16     $30         $30     $55         $41
                           ------- ------- ----------- ------- -----------

    Cash interest payments    $48     $38         $44    $130        $128
                           ------- ------- ----------- ------- -----------
    

    Notes to the Consolidated Financial Statements appear on pages 24 to 33.

    
    Consolidated Statements of Changes in Shareholders' Equity
    (unaudited, millions of U.S. dollars, except number of shares)

                                              Common Shares   Contributed
                                            -----------------
                                              Shares   Amount   Surplus
                                            ---------- ------ -----------

    Balance at Dec. 31, 2005                82,364,899   $494         $16

    Net loss                                         -      -           -
    Other comprehensive income
       Unrealized gain on translation of
        self-sustaining foreign operations           -      -           -
    Comprehensive income
    Issued for cash on exercise of stock
     options                                   176,045      2           -
    Stock option compensation cost                   -      -           7
    Common share dividends                           -      -           -
    Stock options retired for cash                   -      -           -
                                            ---------- ------ -----------

    Balance at Mar. 31, 2006                82,540,944   $496         $23

    Net income                                       -      -           -
    Other comprehensive income
       Unrealized gain on translation of
        self-sustaining foreign operations           -      -           -
    Comprehensive income
    Issued for cash on exercise of stock
     options                                     8,750      1           -
    Stock option compensation cost                   -      -           1
    Common share dividends                           -      -           -
                                            ---------- ------ -----------

    Balance at June 30, 2006                82,549,694   $497         $24

    Net loss                                         -      -           -
    Other comprehensive income
       Unrealized gain on translation of
        self-sustaining foreign operations           -      -           -
    Comprehensive loss
    Issued for cash on exercise of stock
     options                                     3,662      -           -
    Common share dividends                           -      -           -
    Stock options retired for cash                   -      -           -
                                            ---------- ------ -----------

    Balance at Sep. 30, 2006                82,553,356   $497         $24
                                            ---------- ------ -----------

    Consolidated Statements of Changes in
     Shareholders' Equity
    (unaudited, millions of U.S. dollars, except
     number of shares)
                                           Accumulated
                                              Other     Reinvested
                                          Comprehensive  Earnings
                                             Income     (Deficit)   Total
                                         -------------- ---------- -------

    Balance at Dec. 31, 2005                       $324      $381  $1,215

    Net loss                                          -        (4)     (4)
    Other comprehensive income
       Unrealized gain on translation of
        self-sustaining foreign
        operations                                    7         -       7
                                                                   -------
    Comprehensive income                                                3
    Issued for cash on exercise of stock
     options                                          -         -       2
    Stock option compensation cost                    -         -       7
    Common share dividends                            -        (7)     (7)
    Stock options retired for cash                    -        (1)     (1)
                                         -------------- ---------- -------

    Balance at Mar. 31, 2006                       $331      $369  $1,219

    Net income                                        -       106     106
    Other comprehensive income
       Unrealized gain on translation of
        self-sustaining foreign
        operations                                   66         -      66
                                                                   -------
    Comprehensive income                                              172
    Issued for cash on exercise of stock
     options                                          -         -       1
    Stock option compensation cost                    -         -       1
    Common share dividends                            -        (8)     (8)
                                         -------------- ---------- -------

    Balance at June 30, 2006                       $397      $467  $1,385

    Net loss                                          -       (24)    (24)
    Other comprehensive income
       Unrealized gain on translation of
        self-sustaining foreign
        operations                                   17         -      17
                                                                   -------
    Comprehensive loss                                                 (7)
    Issued for cash on exercise of stock
     options                                          -         -       -
    Common share dividends                            -        (7)     (7)
    Stock options retired for cash                    -        (1)     (1)
                                         -------------- ---------- -------

    Balance at Sep. 30, 2006                       $414      $435  $1,370
                                         -------------- ---------- -------
    

    Notes to the Consolidated Financial Statements appear on pages 24 to 33.

    

                                              Common Shares   Contributed
                                            -----------------
                                              Shares   Amount   Surplus
                                            ---------- ------ -----------


    Balance at Dec. 31, 2006                82,561,272   $497        $25

    Net income                                       -      -          -
    Other comprehensive income
       Unrealized gain on
       translation of
       self-sustaining foreign
       operations                                    -      -          -
    Comprehensive income
    Issued for cash on exercise of stock
     options                                   187,620      3          -
    Stock option compensation cost                   -      -          2
    Common share dividends                           -      -          -
                                            ---------- ------ -----------

    Balance at Mar. 31, 2007                82,748,892   $500        $27

    Net income                                       -      -          -
    Other comprehensive income
       Unrealized gain on
       translation of
       self-sustaining foreign
       operations                                    -      -          -
    Comprehensive income
    Issued for cash on exercise of stock
     options                                   112,781      1          -
    Stock option compensation cost                   -      -         (1)
    Common share dividends                           -      -          -
    Stock options retired for cash                   -      -          -
                                            ---------- ------ -----------

    Balance at June 30, 2007                82,861,673   $501        $26

    Net income                                       -      -          -
    Other comprehensive income
    (loss)
       Unrealized loss on
       available for sale
       securities                                    -      -          -
       Unrealized gain on
       translation of
       self-sustaining foreign
       operations                                    -      -          -
    Comprehensive income
    Issued for cash on exercise of stock
     options                                   189,316      4          -
    Common share dividends                           -      -          -
                                            ---------- ------ -----------

    Balance at Sep. 30, 2007                83,050,989   $505        $26

                                       Accumulated
                                          Other     Reinvested
                                      Comprehensive  Earnings
                                         Income     (Deficit)     Total
                                      ------------- ---------- -----------
                                       (restated -             (restated -
                                       see Note 7)             see Note 7)

    Balance at Dec. 31, 2006                  $378      $(354)       $546

    Net income                                   -         44          44
    Other comprehensive income
       Unrealized gain on
       translation of
       self-sustaining foreign
       operations                               26          -          26
                                                               -----------
    Comprehensive income                                               70
    Issued for cash on exercise of
     stock options                               -          -           3
    Stock option compensation cost               -          -           2
    Common share dividends                       -         (7)         (7)
                                      ------------- ---------- -----------

    Balance at Mar. 31, 2007                  $404      $(317)       $614

    Net income                                   -         80          80
    Other comprehensive income
       Unrealized gain on
       translation of
       self-sustaining foreign
       operations                               93          -          93
                                                               -----------
    Comprehensive income                                              173
    Issued for cash on exercise of
     stock options                               -          -           1
    Stock option compensation cost               -          -          (1)
    Common share dividends                       -         (8)         (8)
    Stock options retired for cash               -         (1)         (1)
                                      ------------- ---------- -----------

    Balance at June 30, 2007                  $497      $(246)       $778

    Net income                                   -         97          97
    Other comprehensive income
    (loss)
       Unrealized loss on
       available for sale
       securities                               (1)         -          (1)
       Unrealized gain on
       translation of
       self-sustaining foreign
       operations                               91          -          91
                                                               -----------
    Comprehensive income                                              187
    Issued for cash on exercise of
     stock options                               -          -           4
    Common share dividends                       -         (8)         (8)
                                      ------------- ---------- -----------

    Balance at Sep. 30, 2007                $587(1)     $(157)       $961
    

    (1) The accumulated other comprehensive income as of Sep. 30, 2007
includes $1 million of unrealized loss on available for sale securities. The
remaining balance as of Sep. 30, 2007 and the balance for all prior periods is
comprised solely of foreign currency translation adjustments.

    Notes to the Consolidated Financial Statements appear on pages 24 to 33.

    Notes to Consolidated Financial Statements

    (unaudited, millions of U.S. dollars, except per share amounts and unless
otherwise noted)

    These interim Consolidated Financial Statements do not include all of the
disclosures included in NOVA Chemicals' annual Consolidated Financial
Statements. Accordingly, these interim Consolidated Financial Statements
should be read in conjunction with the Consolidated Financial Statements for
the year ended Dec. 31, 2006.

    1. Significant Accounting Policies

    These interim Consolidated Financial Statements have been prepared in
accordance with Canadian GAAP, using the same accounting policies as set out
in Note 2 to the Consolidated Financial Statements for the year ended Dec. 31,
2006 on pages 80 to 84 of the 2006 Annual Report, except as follows.

    On Jan. 1, 2007, NOVA Chemicals adopted the Canadian Institute of
Chartered Accountants (CICA) Handbook Section 1506, Accounting Changes. CICA
Section 1506 provides that an entity is permitted to change accounting
policies only when it is required by a primary source of GAAP, or when the
change results in a reliable and more relevant presentation in the financial
statements. This new standard applies to fiscal years beginning on or after
Jan. 1, 2007.

    On Jan. 1, 2007, NOVA Chemicals adopted CICA Section 3855, Financial
Instruments - Recognition and Measurement; Section 3865, Hedges; Section 1530,
Comprehensive Income; Section 3251, Equity. These new standards apply to
fiscal years beginning on or after Oct. 1, 2006. In addition, NOVA Chemicals
has adopted the related disclosure and presentation changes as contained in
the existing CICA Section 3861, Financial Instruments - Disclosure and
Presentation.

    CICA Section 3855 establishes standards for recognizing and measuring
financial assets, financial liabilities and non-financial derivatives. Under
CICA Section 3855, all financial assets must be classified as either
held-for-trading, available for sale, held to maturity investments or loans
and receivables. All financial liabilities must be classified as
held-for-trading or other financial liabilities. All financial instruments,
including derivatives, are included on the Consolidated Balance Sheets and are
measured at fair value, except for held to maturity investments, loans and
receivables and other financial liabilities, which are measured at amortized
cost. Subsequent measurement and recognition of changes in fair value depend
on the instrument's initial classification. Held-for-trading financial
instruments are measured at fair value and all gains and losses are included
in net income (loss) in the period in which they arise. Available for sale
financial instruments are measured at fair value, determined by published
market prices in an active market, except for investments in equity
instruments that do not have quoted market prices in an active market which
are measured at cost. Changes in fair value are recorded in other
comprehensive income (loss) until the assets are removed from the balance
sheet. Investments classified as available for sale are written down to fair
value through income whenever it is necessary to reflect other-than-temporary
impairment. Realized gains and losses on the disposal of available for sale
securities, are recognized in other gains and losses. Also, transaction costs
related to all financial assets and liabilities are added to the acquisition
or issue cost, unless the financial instrument is classified as
held-for-trading, in which case the transaction costs are recognized
immediately in net income (loss).

    CICA Section 3855 also requires financial and non-financial derivative
instruments to be measured at fair value and recorded as either assets or
liabilities, with the exception of non-financial derivative contracts that
were entered into and continue to be held for the purpose of receipt or
delivery of a non-financial item in accordance with NOVA Chemicals' expected
purchase, sale or usage requirements. Certain derivatives embedded in
non-derivative contracts must also be measured at fair value. Any changes in
the fair value of recognized derivatives are included in net income (loss) in
the period in which they arise, unless specific hedge accounting criteria are
met, as defined in CICA Section 3865. As a result, NOVA Chemicals has
reflected an unrealized gain of $9 million ($0.11 gain per share diluted) and
an unrealized loss of $1 million ($0.01 loss per share diluted) for the
periods ended Sep. 30, 2007 and June 30, 2007, respectively, which is included
in feedstock and operating costs on the Consolidated Statements of Income.
Fair values for NOVA Chemicals' recognized commodity-based derivatives are
based on the forward prices of the associated market index. No non-financial
derivatives have been recognized as a result of the application of this
standard, as all of NOVA Chemicals' non-financial derivative contracts have
been designated and documented as meeting NOVA Chemicals' expected purchase,
sale or usage requirements.

    As a result of the adoption of CICA Section 3855, NOVA Chemicals has
classified, at Sep. 30, 2007 and Jan. 1, 2007, its financial instruments as
follows: cash and cash equivalents, derivative instruments (included in
Accounts receivables, Investments and other assets and Deferred credits and
long-term liabilities on the Consolidated Balance Sheets) as held-for-trading;
trade accounts receivable, advances receivable from affiliates and other
receivables (included in Accounts receivable on the Consolidated Balance
Sheets) and Restricted cash and other assets as loans and receivables;
investments in non-affiliated entities (included in Investments and other
assets on the Consolidated Balance Sheets) as available for sale; and trade
accounts payable, other accounts payable, certain accrued liabilities
(included in Accounts payable and accrued liabilities on the Consolidated
Balance Sheets); bank loans (line of credit); long-term liabilities (included
in Deferred credits and long-term liabilities on the Consolidated Balance
Sheets); and long-term debt as other financial liabilities.

    Under CICA Section 3855, long-term debt is required to be initially
measured at fair value and subsequently measured at amortized cost. As a
result, certain deferred debt discount and issuance costs that were previously
reported in Restricted cash and other assets and Investments and other assets
on the Consolidated Balance Sheets have been reclassified, on a prospective
basis, and are now reported as a reduction of the respective debt obligations.
In total, $17 million was reclassified in the first quarter of 2007.

    As noted above, investments in non-affiliated entities classified as
available for sale are now measured at fair market value. Previously, these
investments were measured at cost. On Jan. 1, 2007, the impact of this change
was not material to the Consolidated Financial Statements. During the
three-month period ending Sep. 30, 2007, the change in fair value of these
investments resulted in a loss of $1 million, net of tax, was recorded in
Other comprehensive income in the Consolidated Statements of Changes in
Shareholders' Equity. During the three-month period ending June 30, 2007, the
change in fair value of these investments was not material to the Consolidated
Financial Statements. NOVA Chemicals' investments in non-affiliated entities
that do not have a quoted market price in an active market are measured at
cost. As of Sep. 30, 2007 and Jan. 1, 2007 these investments totaled $12
million and $13 million, respectively.

    The recommendations of CICA Section 3865, Hedges, replaces and expands
the guidance in CICA Accounting Guideline 13 (AcG-13), Hedging Relationships
and the hedging guidance in CICA Section 1650, Foreign Currency Translation.
CICA Section 3865 establishes standards for when and how hedge accounting may
be applied as well as related disclosure requirements. Hedge accounting
ensures the recording, in the same period, of counterbalancing gains, losses,
revenues and expenses from designated derivative financial instruments as
those related to the hedged item. NOVA Chemicals evaluated the impact of CICA
Section 3865 on its Consolidated Financial Statements, at Jan. 1, 2007, and
determined that a gain on settlement of a derivative instrument that was
previously designated as a hedge and deferred on the Consolidated Balance
Sheets should now be reported as an adjustment of the previously hedged
long-term debt instrument. As such, the deferred gain of $4 million was
reclassified, on a prospective basis, from Accounts payable and accrued
liabilities and Deferred credits and long-term liabilities to Long-term debt.

    CICA Section 1530, Comprehensive Income, establishes standards for
reporting and presentation of comprehensive income (loss), which is defined as
the change in equity from transactions and other events and circumstances from
non-owner sources. As a result of adopting CICA Section 1530, two new
statements, Consolidated Statements of Changes in Shareholders' Equity and
Consolidated Statements of Comprehensive Income (Loss) have been presented.
Comprehensive income (loss) is composed of NOVA Chemicals' net income (loss)
and other comprehensive income (loss). Other comprehensive income (loss)
includes unrealized gains (losses) on available for sale financial assets,
foreign currency translation gains (losses) on the net investment in
self-sustaining foreign operations and changes in the fair market value of
derivative instruments designated as cash flow hedges, all net of income
taxes. The components of comprehensive income (loss) are disclosed in the
Consolidated Statements of Changes in Shareholders' Equity. As a result of the
adoption of CICA Section 1530, the cumulative translation adjustment, formerly
presented as a separate line item as part of Shareholders' equity in the
Consolidated Balance Sheets, of $378 million as of Dec. 31, 2006 was
reclassified to Accumulated other comprehensive income.

    CICA Section 3251, Equity, establishes standards for the presentation of
equity and changes in equity during the reporting periods. The requirements
under this Section have been effected in the presentation of the Consolidated
Statements of Changes in Shareholders' Equity.

    In the first quarter of 2007, NOVA Chemicals changed its accounting for
its interest in the European accounts receivable securitization program,
undertaken by the European Joint Venture. Accounts receivable securitization
transactions are recorded as sales of assets based on the transfer of control
to the purchaser as opposed to financing.

    Certain comparative figures have been restated to conform to the current
periods' presentation. In particular, Canadian GAAP implemented EIC (Emerging
Issues Committee) 162, Stock-Based Compensation for Employees Eligible to
Retire Before the Vesting Date, which resulted in the acceleration of the
recognition of compensation cost for stock-based awards based on employees'
retirement eligibility at the date of the grant. This standard became
effective for NOVA Chemicals in the fourth quarter of 2006 and was applied
retroactively, with restatement of prior periods, as required by EIC 162. The
impact to net income (loss) for the three months and nine months ended Sep.
30, 2006 was a $1 million loss ($0.01 per share) and a $nil million loss
($0.00 per share), respectively.

    2. Pensions and Other Post-Retirement Benefits

    
    Components of Net Periodic Benefit Cost for
    Defined Benefit Plans

                                      Three Months Ended
                     -----------------------------------------------------
                       Sep. 30, 2007     June 30, 2007     Sep. 30, 2006
                     ----------------- ----------------- -----------------
                     Pension   Other   Pension   Other   Pension   Other
                     Benefits Benefits Benefits Benefits Benefits Benefits
                     -------- -------- -------- -------- -------- --------

     Current service
      cost                $2        $1      $7        $-      $7        $1
     Interest cost on
      projected
      benefit
      obligations         11         1      11         1       9         1
     Actual gain on
      plan assets        (13)        -     (13)        -      (9)        -
     Actuarial loss
      on accrued
      obligation           -         -       -         1       -         -
                     -------- -------- -------- -------- -------- --------
     Costs arising in
      the period           -         2       5         2       7         2
     Differences
      between costs
      arising in the
      period and
      costs
      recognized in
      the period in
      respect of the
      long-term
      nature of
      employee future
      benefit costs:
     Transitional
      assets
      (liabilities)       (1)        1      (1)        -      (1)        -
     Actuarial loss        2         -       2         -       2         -
                     -------- -------- -------- -------- -------- --------
     Net defined
      benefit cost
      recognized           1         3       6         2       8        $2
     Curtailment /
      special
      termination
      (benefit)
      charge              (4)        -       -         -       5         4
                     -------- -------- -------- -------- -------- --------
     Total defined
      benefit
      (income) cost
      recognized         $(3)       $3      $6        $2     $13        $6
                     -------- -------- -------- -------- -------- --------
    

    
                                                Nine Months Ended
                                       -----------------------------------
                                         Sep. 30, 2007     Sep. 30, 2006
                                       ----------------- -----------------
                                       Pension   Other   Pension   Other
                                       Benefits Benefits Benefits Benefits
                                       -------- -------- -------- --------

     Current service cost                  $17        $2     $21        $4
     Interest cost on projected benefit
      Obligations                           32         3      27         3
     Actual gain on plan assets            (39)        -     (27)        -
     Actuarial loss on accrued
      obligation                             2         1       -         -
                                       -------- -------- -------- --------
     Costs arising in the period            12         6      21         7
     Differences between costs arising
      in the period and costs
      recognized in the period in
      respect of the long-term nature
      of employee future benefit costs:
     Transitional assets (liabilities)      (3)        1      (3)        -
     Actuarial loss                          4         -       6         -
                                       -------- -------- -------- --------
     Net defined benefit cost
      recognized                            13         7      24         7
     Curtailment / special termination
      (benefit) charge                      (4)        -       5         4
                                       -------- -------- -------- --------
     Total defined benefit (income)
      cost recognized                       $9        $7     $29       $11
                                       -------- -------- -------- --------
    

    The expected long-term rate of a return on plan assets is 7.5% compared
to 7.4% in the prior year.

    On September 28, 2007, NOVA amended certain defined benefit pension
plans. The amendments provided for benefits to be frozen as of January 1, 2008
and provide transition relief to plan participants meeting certain age and
service requirements. At the same time NOVA also enhanced benefits under one
of its defined contribution plans.

    The restructuring that occurred in 2007 and the defined benefit pension
plan amendments described above triggered one or more of the following charges
(benefits) in the third quarter of 2007: a curtailment charge (benefit), a
special termination charge or a settlement charge. A curtailment charge
(benefit) results from either the termination of employment earlier than
previously assumed or the significant reduction in future benefit accruals. A
special termination charge results from enhancements provided under the
voluntary programs (e.g., additional years of age, service). A settlement
charge results when total lump sum benefits paid during a given year exceed a
certain threshold. In the third quarter of 2006, the North American
restructuring triggered one ore more of the aforementioned charges (benefits).
The impact of these changes are reflected in the table above.

    Employer Contributions

    NOVA Chemicals contributed $22 million, $7 million and $28 million during
the quarters ended Sep. 30, 2007, June 30, 2007, and Sep. 30, 2006,
respectively, to its defined benefit pension plans. NOVA Chemicals contributed
$2 million for each of the quarters ended Sep. 30, 2007, June 30, 2007, and
Sep. 30, 2006 to its defined contribution plans. NOVA Chemicals contributed
$43 million and $50 million during the nine months ended Sep. 30, 2007 and
Sep. 30, 2006, respectively, to its defined benefit pension plans. NOVA
Chemicals contributed $6 million during each of the nine month periods ended
Sep. 30, 2007 and Sep. 30, 2006 to its defined contribution plans.

    3. Restructuring Charges

    There were no restructuring charges in the third quarter of 2007.

    In the second quarter of 2007, NOVA Chemicals accrued $7 million ($7
million after-tax - see Note 5 below) of restructuring costs related to the
May 31, 2007 announcement of the elimination of approximately 90 positions in
the U.S. and Europe. To date, $2 million of the severance costs has been paid
to employees. In addition, NOVA Chemicals accrued $3 million ($2 million
after-tax) of restructuring costs related to additional actions taken in the
European Joint Venture.

    In the third quarter of 2006, NOVA Chemicals accrued $53 million
before-tax ($33 million after-tax) for severance, pension and other employee
related costs related to the restructuring of its North American operations to
better align resources and reduce costs. To date, $28 million has been paid to
employees. In addition, NOVA Chemicals incurred a charge of $56 million
before-tax ($46 million after-tax) primarily related to the write-down of the
Carrington, UK, solid PS facility following the announcement to permanently
close that site.

    In the second quarter of 2006, NOVA Chemicals accrued $1 million of
additional restructuring costs related to the rationalization activities
commenced in 2005 in its European Joint Venture.

    In the first quarter of 2006, NOVA Chemicals included in the
restructuring charges severance costs of $15 million ($10 million after-tax)
related to the Chesapeake, VA closure. To date, $6 million of the severance
costs has been paid to employees.

    4. Interest Expense

    
    Components of interest
     expense                       Three Months Ended    Nine Months Ended
                                 ----------------------- -----------------
                                 Sep. 30 June 30 Sep. 30  Sep. 30  Sep. 30
                                  2007    2007    2006     2007     2006
                                 ------- ------- ------- --------- -------
    Interest on long-term debt      $36     $34     $35      $105    $110
    Interest on securitizations
     and other                       13      10      10        32      21
                                 ------- ------- ------- --------- -------
    Gross interest expense           49      44      45       137     131
    Interest capitalized during
     plant construction               -       -      (1)       (1)     (2)
    Interest income                  (2)     (3)     (1)       (6)     (4)
                                 ------- ------- ------- --------- -------
    Interest expense (net)          $47     $41     $43      $130    $125
                                 ------- ------- ------- --------- -------
    

    5. Income Taxes

    
                                   Three Months Ended    Nine Months Ended
                                 ----------------------- -----------------
                                 Sep. 30 June 30 Sep. 30  Sep. 30  Sep. 30
                                  2007    2007    2006     2007     2006
                                 ------- ------- ------- --------- -------
    Income (loss) before income
     taxes                         $142    $108    $(31)     $310     $33
    Statutory income tax rate     32.12%  32.12%  32.49%    32.12%  32.49%
                                 ------- ------- ------- --------- -------
    Computed income tax expense
     (recovery)                     $46     $35    $(10)     $100     $11
    (Decrease) increase in taxes
     resulting from:
      Tax benefit of rate
       reductions (1)                (6)     (6)      -       (12)    (60)
      Foreign tax rates              (5)     (4)     (4)      (13)     (7)
      Tax benefits not
       recognized(2)                 10       4       6        14       6
      Other                           -      (1)      1         -       5
                                 ------- ------- ------- --------- -------
    Income tax expense (recovery)   $45     $28     $(7)      $89    $(45)
                                 ------- ------- ------- --------- -------


    (1) In the second quarter of 2007, the Canadian federal government
     reduced the general income tax rate from 19% to 18.5% effective
     January 1, 2011. As a result, future tax liabilities were reduced by
     $12 million. In the second quarter of 2006, future tax liabilities
     were reduced by $60 million as a result of the enactment of Canadian
     federal and Alberta provincial income tax rate reductions. The
     benefits that result from these periodic revisions are recorded as
     reductions in income tax expense in the applicable quarters.
    (2) The tax benefits of certain costs have not been recorded due to
     uncertainty that tax benefits will be realized prior to the
     expiration of the loss carryforwards in the U.S.
    

    6. Earnings (Loss) Per Share

    
    (shares in millions)                   Three Months Ended
                               -------------------------------------------
                                  Sep. 30       June 30        Sep. 30
                                   2007          2007           2006
                               ------------- ------------- ---------------
                               Basic Diluted Basic Diluted  Basic  Diluted

    Net income (loss) available
     to common shareholders      $97     $97   $80     $80   $(24)   $(24)
                               ----- ------- ----- ------- ------- -------
    Weighted average common
     shares outstanding         83.0    83.0  82.9    82.9   82.6    82.6
    Add back effect of dilutive
     securities: Stock Options     -     0.8     -     0.8      -       -
                               ----- ------- ----- ------- ------- -------
    Weighted-average common
     share for EPS calculations 83.0    83.8  82.9    83.7   82.6    82.6
                               ----- ------- ----- ------- ------- -------
    Earnings (loss) per share  $1.17   $1.16 $0.97   $0.96 $(0.29) $(0.29)
                               ----- ------- ----- ------- ------- -------


    No stock options were excluded from the computation of diluted
     earnings (loss) per share for the quarters ended Sep. 30, 2007 and
     June 30, 2007. 3.4 million stock options were excluded from the
     computation of diluted earnings (loss) per share for the quarter
     ended Sep. 30, 2006 because they were anti-dilutive. Options become
     dilutive when the market price is higher than the strike price and
     NOVA Chemicals is profitable. The amount of dilution will vary with
     the stock price. As of Sep. 30, 2007, the fully diluted share count
     was 83.8 million.
    

    
    (shares in millions)                            Nine Months Ended
                                               ---------------------------
                                                  Sep. 30       Sep. 30
                                                   2007          2006
                                               ------------- -------------
                                               Basic Diluted Basic Diluted

    Net income available to common shareholders $221    $221   $78     $78
                                               ----- ------- ----- -------

    Weighted average common shares outstanding  82.9    82.9  82.5    82.5
    Add back effect of dilutive securities:
     Stock Options                                 -     0.7     -     0.8
                                               ----- ------- ----- -------
    Weighted-average common share for EPS
     calculations                               82.9    83.6  82.5    83.3
                                               ----- ------- ----- -------
    Earnings per share                         $2.67   $2.65 $0.95   $0.94
                                               ----- ------- ----- -------
    

    7. Second Quarter 2007 Balance Sheet Restatement

    A reclassification of book to tax differences on foreign exchange
balances was done in the second quarter of 2007 results to correct a
misclassification in the balance sheet between future income taxes and
accumulated other comprehensive income. $105 million was reclassified from
accumulated other comprehensive income to future income taxes thereby reducing
Shareholders' equity in the second quarter of 2007 from that previously
reported. There was no impact on net income, earnings per share or cash in the
second or third quarters as a result of this restatement.

    8. Segmented Information

    Refer to pages 104 and 105 of the Consolidated Financial Statements for
the year ended Dec. 31, 2006 for the description of each segment and
accounting policies for segment reporting. Beginning in the first quarter of
2007, NOVA Chemicals no longer allocates interest, taxes or corporate
operating costs to the business segments. Prior period comparative amounts
have been revised to reflect this change. Mark-to-market adjustments on NOVA
Chemicals' open feedstock derivative positions are recorded as part of
Corporate results until the positions are realized. Once realized, any income
effects are recorded in business results.

    The third quarter of 2007 is the last quarter that NOVA Chemicals will
report the results for the styrene monomer, North American Solid Polystyrene
and European Joint Venture segments. Beginning in the fourth quarter of 2007,
NOVA Chemicals will report the results of the INEOS NOVA Joint Venture which
commenced operations on Oct. 1, 2007.

    The following tables provide information for each segment.

    
                                   Three Months Ended    Nine Months Ended
                                 ----------------------- -----------------
                                 Sep. 30 June 30 Sep. 30  Sep. 30  Sep. 30
                                  2007    2007    2006     2007     2006
                                 ------- ------- ------- --------- -------
    Revenue
      Joffre Olefins               $448    $425    $417    $1,284  $1,317
      Corunna Olefins               595     502     557     1,494   1,482
      Polyethylene                  519     475     507     1,417   1,467
      Performance Styrenics         117     115     111       332     316
      Styrene Monomer               468     471     485     1,403   1,363
      North American Solid
       Polystyrene                  136     144     140       421     381
      European Joint Venture        175     193     179       556     488
      Eliminations                 (703)   (649)   (684)   (1,970) (1,930)
                                 ------- ------- ------- --------- -------
                                 $1,755  $1,676  $1,712    $4,937  $4,884
                                 ------- ------- ------- --------- -------
    Adjusted EBITDA (1)
      Joffre Olefins               $172    $121    $160      $400    $455
      Corunna Olefins                57      58      28       157      89
      Polyethylene                   60      50      83       132     149
      Performance Styrenics           3      (6)     (2)       (9)     (3)
      Styrene Monomer               (22)     23       5        11      (1)
      North American Solid
       Polystyrene                   (7)     (7)     (8)      (20)    (21)
      European Joint Venture          1      13       -        29      (7)
      Corporate                     (11)    (31)    (68)      (59)   (142)
      Eliminations                   (2)     (1)     (1)      (15)    (13)
                                 ------- ------- ------- --------- -------
                                   $251    $220    $197      $626    $506
                                 ------- ------- ------- --------- -------


    (1) Net income (loss) before restructuring charges, income taxes,
     other gains and losses, interest expense and depreciation and
     amortization (see Consolidated Statements of Net Income (Loss) on
     page 19 and Supplemental Measures on page 18).


    Operating income (loss)
      Joffre Olefins                         $157  $108  $148  $360  $418
      Corunna Olefins                          41    42    13   110    47
      Polyethylene                             43    34    67    83    99
      Performance Styrenics                    (5)  (14)   (5)  (30)  (12)
      Styrene Monomer                         (25)   20    (9)    3   (42)
      North American Solid Polystyrene         (8)   (8)  (13)  (23)  (36)
      European Joint Venture                    -    12    (8)   26   (31)
      Corporate                               (13)  (43) (179)  (75) (273)
      Eliminations                             (2)   (1)   (1)  (15)  (13)
                                             ----- ----- ----- ----- -----
      Total operating income                 $188  $150   $13  $439  $157
      Interest expense (net)                  (47)  (41)  (43) (130) (125)
      Other gains and losses (net)              1    (1)   (1)    1     1
      Income tax (expense) recovery           (45)  (28)    7   (89)   45
                                             ----- ----- ----- ----- -----
      Net income (loss)                       $97   $80  $(24) $221   $78
                                             ----- ----- ----- ----- -----
    

    
                                   Three Months Ended    Nine Months Ended
                                 ----------------------- -----------------
                                 Sep. 30 June 30 Sep. 30  Sep. 30  Sep. 30
                                  2007    2007    2006     2007     2006
                                 ------- ------- ------- --------- -------
    Depreciation and amortization
     expense
      Joffre Olefins                 $15     $13     $12       $40    $37
      Corunna Olefins                 16      16      15        47     42
      Polyethylene                    17      16      16        49     50
      Performance Styrenics            8       8       3        21      9
      Styrene Monomer                  3       3      14         8     41
      North American Solid
       Polystyrene                     1       1       5         3     15
      European Joint Venture           1       1       8         3     24
      Corporate                        2       2       2         6      6
                                 ------- ------- ------- --------- -------
                                     $63     $60     $75      $177   $224
                                 ------- ------- ------- --------- -------
    Capital expenditures
      Joffre Olefins                  $5      $6      $8       $15    $18
      Corunna Olefins                  8       1      10        33     39
      Polyethylene                    10       8       4        20     12
      Performance Styrenics            6       2      16        10     67
      Styrene Monomer                  4       2       1         7      3
      North American Solid
       Polystyrene                     1       2       2         4      4
      European Joint Venture           1       3       6         7      9
                                 ------- ------- ------- --------- -------
                                     $35     $24     $47       $96   $152
                                 ------- ------- ------- --------- -------

                                                          Sep. 30  Dec. 31
                                                           2007     2006
                                                         --------- -------
    Assets
      Joffre Olefins                                         $859    $743
      Corunna Olefins                                       1,300   1,092
      Polyethylene                                          1,136     946
      Performance Styrenics                                   418     429
      Styrene Monomer                                         352     334
      North American Solid Polystyrene                        102      82
      European Joint Venture                                  262     183
      Corporate (1)                                           382     331
      Eliminations                                            (28)    (18)
                                                         --------- -------
                                                           $4,783  $4,122
                                                         --------- -------
    (1) Amounts include all cash and cash equivalents.
    

    9. Reconciliation to United States Generally Accepted Accounting
Principles

    
                               Three Months Ended       Nine Months Ended
                           --------------------------- -------------------
                           Sep. 30 June 30   Sep. 30   Sep. 30   Sep. 30
                            2007    2007      2006      2007      2006
                           ------- ------- ----------- ------- -----------
                                           (restated -         (restated -
                                           see Note 1)         see Note 1)
    Net income (loss) in
     accordance with
     Canadian GAAP             $97    $80        $(24)   $221         $78
    Add (deduct)
     adjustments for:
      Start-up costs (1)         -      -           2       1          (4)
      Derivative
       instruments and
       hedging activity (2)      -      -          (3)     (1)         (2)
      Inventory costing (3)      1     (1)          6      (1)          -
      Stock-based
       compensation (4)          1      1          (1)      3          (1)
      Other                      -      -           1       -           1
                           ------- ------- ----------- ------- -----------
    Net income (loss) in
     accordance with U.S.
     GAAP                      $99    $80        $(19)   $223         $72
                           ------- ------- ----------- ------- -----------
    Earnings (loss) per
     share - basic           $1.19  $0.97      $(0.23)  $2.69       $0.87
                           ------- ------- ----------- ------- -----------
    Earnings (loss) per
     share - diluted         $1.18  $0.96      $(0.23)  $2.67       $0.86
                           ------- ------- ----------- ------- -----------
    

    
                               Three Months Ended       Nine Months Ended
                           --------------------------- -------------------
                           Sep. 30 June 30   Sep. 30   Sep. 30   Sep. 30
                            2007    2007      2006      2007      2006
                           ------- ------- ----------- ------- -----------
                                           (restated -         (restated -
                                           see Note 1)         see Note 1)
    Comprehensive income
     (loss) in accordance
     with Canadian GAAP       $187   $173         $(7)   $430        $168
    Add (deduct)
     adjustments to
     Canadian GAAP net
     income (loss) for:
      Start-up costs (1)         -      -           2       1          (4)
      Derivative
       instruments and
       hedging activity (2)      -      -          (3)     (1)         (2)
      Inventory costing (3)      1     (1)          6      (1)          -
      Stock-based
       compensation (4)          1      1          (1)      3          (1)
      Other                      -      -           1       -           1
    Pension liability
     adjustments (net of
     tax of $9, $nil, $nil,
     $9 and $nil,
     respectively)              16      -           -      16           -
                           ------- ------- ----------- ------- -----------
    Comprehensive income
     (loss) in accordance
     with U.S. GAAP           $205   $173         $(2)   $448        $162
                           ------- ------- ----------- ------- -----------
    

    
                                                           Sep. 30 Dec. 31
                                                            2007    2006
                                                           ------- -------
    Accumulated other comprehensive income
      Unrealized loss on available for sale securities        $(1)     $-
      Unrealized gain on translation of self-sustaining
       foreign operations                                     567     357
      Pension liability adjustment (5)                        (66)    (82)
                                                           ------- -------
                                                             $500    $275
                                                           ------- -------
    Balance sheet in accordance with U.S. GAAP (7)
      Current assets (3)                                   $1,663  $1,337
      Investments and other assets (1), (5)                    79      82
      Property, plant and equipment, net (1)                3,057   2,719
      Current liabilities (2), (6)                         (1,224) (1,186)
      Long-term debt (2)                                   (1,654) (1,584)
      Deferred income taxes (1), (2), (3), (4), (5), (6)     (541)   (397)
      Deferred credits and long-term liabilities (2), (4),
       (5), (6)                                              (483)   (501)
                                                           ------- -------
      Common shareholders' equity (5),(6)                    $897    $470
                                                           ------- -------
    

    
    (1)Start-up Costs. Canadian GAAP provides that when an entity starts
        up a new facility, expenditures incurred during the pre-operating
        period may be deferred when certain criteria are met. Under U.S.
        GAAP, all costs (except interest on constructed assets) associated
        with start-up activities must be expensed as incurred.

    (2)Derivative Instruments and Hedging Activities. CICA Section 3855
        harmonizes Canadian and U.S. GAAP by establishing standards for
        recognition and measurement of financial assets, liabilities and
        non-financial derivatives. CICA Section 3865 harmonizes Canadian
        GAAP with U.S. GAAP SFAS No. 133 by establishing standards for
        when and how hedge accounting may be applied and recorded. See
        Note 1 for further details. Certain differences that existed
        before the implementation of the above standards on Jan. 1, 2007,
        pertaining to the termination of interest rate swaps in 2002,
        continue to be reconciling items between Canadian GAAP and U.S.
        GAAP.

    (3)Inventory Costing. Canadian GAAP allows fixed overhead costs
        associated with production activities to be expensed during the
        period whereas U.S. GAAP requires an allocation of fixed
        production overhead to inventory.

    (4)Stock-Based Compensation. Under Canadian GAAP, the Employee
        Incentive Stock Option Plan is measured using a fair-value based
        method, while the Equity Appreciation Plan and the Restricted
        Stock Unit Plan are classified as liability instruments and are
        marked-to-market based on intrinsic value. U.S. GAAP, SFAS No.
        123(R), Share-Based Payment, effective Jan. 1, 2006, requires the
        share-based compensation transactions to be accounted for using a
        fair-value based method, such as the Black Scholes method. The
        fair value of awards classified as liability instruments must be
        remeasured subsequently at each reporting date through the
        settlement date. Changes in fair value during the requisite
        service period will be recognized as compensation cost over that
        period. The cumulative effect for the periods prior to Dec. 31,
        2005 of $5 million after-tax, has been charged to reinvested
        earnings (deficit) at Jan. 1, 2006.

    (5)Pension Liability Adjustment. In 2006, for U.S. GAAP reporting,
        SFAS No. 158, Employers' Accounting for Defined Benefit Pension
        and Other Postretirement Plans - an amendment of SFAS Nos. 87, 88,
        106, and 132(R), was effective. SFAS No. 158 requires an employer
        to recognize the overfunded or underfunded status of a defined
        benefit postretirement plan (other than a multi-employer plan) as
        an asset or liability in its statement of financial position and
        to recognize changes in that funded status in the year in which
        the changes occur through accumulated other comprehensive income
        (loss). Accordingly, at Dec. 31, 2006, NOVA Chemicals recognized
        an additional pension and post-retirement liability of $124
        million, resulting in a charge of $82 million (net of tax) to
        accumulated other comprehensive income. In 2006 (prior to the
        adoption of SFAS No. 158), SFAS No. 87, Employer's Accounting for
        Pensions, was followed with respect to pension accounting, which
        required an employer to record an additional minimum liability
        (AML) if the unfunded accumulated benefit obligation exceeded the
        accrued pension liability or if there was a prepaid pension asset
        with respect to the plan. If an AML was recognized, an intangible
        asset, in an amount not exceeding the unrecognized prior service
        cost, was also recognized. The excess of the AML, over the
        intangible asset, if any, was charged to other comprehensive
        income (loss), net of income tax effects. At Sep. 30, 2007, plan
        assets and benefit obligations were re-measured for certain
        defined benefit pension plans as a result of pension plan changes
        as described in Note 2 on page 26. Accordingly, at Sep. 30, 2007,
        NOVA Chemicals adjusted its SFAS No. 158 pension and post-
        retirement liability by $25 million, resulting in a credit of $16
        million (net of tax) to accumulated other comprehensive income.

    (6)Income Taxes. Beginning Jan. 1, 2007, FIN 48, Accounting for
        Uncertainty in Income Taxes, became effective for U.S. GAAP
        reporting. FIN 48 clarifies the accounting for uncertainty in
        income taxes by prescribing a minimum recognition threshold that a
        tax position is required to meet before being recognized. An
        entity is required to recognize the best estimate of a tax
        position if that position is more likely than not to be sustained
        upon examination, based solely on the technical merits of the
        position. NOVA Chemicals adopted the provisions of FIN 48 on Jan.
        1, 2007 at which time a FIN 48 liability of $36 million was
        recognized by reclassifying $34 million out of deferred tax
        liability and $4 million from the current tax liability. This
        resulted in a $6 million increase in the liability for
        unrecognized tax benefits, and was accounted for as a reduction to
        the Jan. 1, 2007, U.S. GAAP balance in reinvested earnings. Since
        implementation of FIN 48 on Jan. 1, 2007, no further changes to
        the FIN 48 liability have been necessary. Also, it is NOVA
        Chemicals policy to recognize interest and penalties accrued
        related to unrecognized tax benefits in income tax expense. At
        Sep. 30, 2007, NOVA Chemicals had approximately $6 million accrued
        for the payment of interest and penalties.

    (7)Joint Ventures. NOVA Chemicals accounts for its interests in joint
        ventures using the Proportionate Consolidation method under
        Canadian GAAP. As permitted by specific U.S. SEC exemptions,
        adjustments to reflect equity accounting, as required under U.S.
        GAAP, have not been made. The equity method would not result in
        any changes in NOVA Chemicals' net income (loss) or shareholders'
        equity; however, all assets, liabilities, revenue, expenses, and
        most cash flow items would decrease when compared to the amounts
        that are presented using proportionate consolidation.
    

    10. New Accounting Pronouncements

    Canadian GAAP

    CICA 1535, Capital Disclosures, applicable to interim and annual periods
relating to fiscal years beginning on or after Oct. 1, 2007, specifies
disclosures of (1) information about the entity's objectives, policies, and
processes for managing capital structure; (2) quantitative data about what the
entity regards as capital; and (3) whether the entity has complied with
externally imposed capital requirements (for example bank covenants) and if it
has not complied, the consequences of such non-compliance. NOVA Chemicals is
currently evaluating the effects of adopting this standard.

    CICA 3862, Financial Instruments - Disclosure and CICA 3863, Financial
Instruments - Presentation, replace CICA 3861, Financial Instruments -
Disclosure and Presentation. These new standards revise and enhance the
disclosure requirements, and carry forward, substantially unchanged, the
presentation requirements. These new standards emphasize the significance of
financial instruments for the entity's financial position and performance, the
nature and extent of risks arising from financial instruments, and how these
risks are managed. These new standards are applicable to interim and annual
periods relating to fiscal years beginning on or after Oct. 1, 2007. NOVA
Chemicals is currently evaluating the effects of adopting this standard.

    CICA 1400, General Standards of Financial Statement Presentation, was
amended to include requirements to assess and disclose an entity's ability to
continue as a going concern. The new requirements are effective for interim
and annual financial statements relating to fiscal years beginning on or after
Jan. 1, 2008. NOVA Chemicals does not expect the adoption of these changes to
have an impact on its financial statements.

    CICA 3031, Inventories, replaces CICA 3030, Inventories. The new standard
is the Canadian equivalent to International Financial Reporting Standard IAS
2, Inventories. The main features of CICA 3031 are: (1) measurement of
inventories at the lower of cost and net realizable value, with guidance on
the determination of cost, including allocation of overheads and other costs
to inventory; (2) cost of inventories of items that are not ordinarily
interchangeable, and goods or services produced and segregated for specific
projects, assigned by using a specific identification of their individual
costs; (3) consistent use (by type of inventory with similar nature and use)
of either first-in, first-out (FIFO) or weighted-average cost formula; (4)
reversal of previous write-downs to net realizable value when there is a
subsequent increase in value of inventories; and (5) possible classification
of major spare parts and servicing stand-by equipment as property, plant and
equipment (CICA 3061 - Property, Plant and Equipment, was amended to reflect
this change). CICA 3031, applies to interim and annual financial statements
relating to fiscal years beginning on or after Jan. 1, 2008. NOVA Chemicals is
evaluating the effects of adopting this standard.

    EIC-166, Accounting Policy for Transaction Costs, requires an entity to
disclose the accounting policy for transaction costs for all financial
assets/liabilities other than those classified as held for trading.
Transaction costs can either be recognized in net income or added to the
initial carrying amount of the asset/liability it is directly attributable to.
The same accounting policy must be chosen for all similar financial
instruments, but a different accounting policy may be chosen for financial
instruments that are not similar. EIC-166 should be applied retrospectively to
transaction costs accounted for in accordance with CICA 3855 in financial
statements issued for interim and annual periods ending on or after Sept. 30,
2007. NOVA Chemicals' accounting policy with respect to transaction costs has
been to capitalize all transaction costs for all financial instruments (except
for those classified as held for trading). This policy will not change as a
result of EIC-166.

    U.S. GAAP

    SFAS No. 159, The Fair Value Option for Financial Assets and Financial
Liabilities, including an amendment to SFAS No. 115, permits entities to
choose to measure many financial instruments and certain other items at fair
value. Most of the provisions of this Statement apply only to entities that
elect the fair value option. However, the amendment to SFAS No. 115,
Accounting for Certain Investments in Debt and Equity Securities, applies to
all entities with available for sale and held-for-trading securities. SFAS No.
159 is effective as of the beginning of an entity's first fiscal year that
begins after Nov. 15, 2007. The adoption of this standard is not expected to
have a material impact on NOVA Chemicals' consolidated financial statements.

    11. Subsequent Events Related to INEOS NOVA

    On Oct. 1, 2007, the expanded INEOS NOVA Joint Venture commenced
operations. In addition to the European assets already included in the INEOS
NOVA Joint Venture, the expanded 50:50 venture includes NOVA Chemicals' North
American styrene and solid PS assets as well as its NAS(R) and ZYLAR(R)
performance resins. The venture also includes INEOS' North American styrene
and solid PS assets and its line of specialty polymers. North American EPS,
Performance Styrenics and DYLARK(R) resins are not included in the Joint
Venture and will continue to be manufactured and sold by NOVA Chemicals.

    NOVA Chemicals contributed Property, Plant and Equipment with book value
of $250 million and working capital of $150 million to the INEOS NOVA Joint
Venture.

    The INEOS NOVA expanded Joint Venture is expected to have annual revenues
of approximately $3.8 billion and is the largest styrene and solid PS producer
in North America and the largest solid PS and EPS producer in Europe.




For further information:

For further information: NOVA Chemicals Corporation Investor Relations
Chuck Magro, 412-490-5047 or Media Relations Greg Wilkinson, 412-490-4166

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NOVA CHEMICALS CORPORATION

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