— DEBT REDUCTION — We ended 2003 with $212 million in cash, $247 million available under our $300 million revolving credit line and debt to total capitalization of 37%. In June 2003, we sold our stake in Methanex for net proceeds of $441 million and our share of the Fort Saskatchewan Ethylene Storage Facility for net proceeds of $123 million. We used a portion of the proceeds to repay $150 million of bonds in August and to pay down our revolving credit line.

— FIXED-COST REDUCTION — NOVA Chemicals is driven to reduce fixed costs. In 2003, the increasing value of the Canadian dollar and European currencies negatively impacted fixed costs when measured in U.S. dollars. We ended the year with fixed costs per pound of capacity up by 5%. In local currencies, we reduced fixed costs by 3%.

In 2004, our goal is to again reduce fixed costs by 5%, net of inflation. The second quarter closure of the 275 million pound polyethylene line at our St. Clair River, Ontario site will contribute to that goal by reducing fixed costs by $5 million to $10 million per year.

— CASH FLOW CYCLE TIME (CFCT) — CFCT measures process improvement and working capital management. It is measured on a days-of-sales basis as:

At the end of 2000, our CFCT was very competitive at 60 days. We focused our attention on improving work processes and leveraging information technology, allowing us to finish 2002 at 20 days. In 2003, we continued to focus on CFCT and we finished the year at 28 days, well within our goal of maintaining CFCT between 25 and 30 days.