| AGREEMENT |
Sipchem and Eastman Sign Definitive Agreements for Acetyls Technology AL-KHOBAR, SAUDI ARABIA, and KINGSPORT, TENN., May 9, 2005 – Saudi International Petrochemical Company (Sipchem) and Eastman Chemical Company (NYSE: EMN) today jointly announced they have signed the definitive agreements for Eastman to license its proprietary acetyl co-production technology to Sipchem. The licensing agreement is part of Sipchem’s plan to establish a world-scale acetyls complex in the Kingdom of Saudi Arabia through expansion of its petrochemical complex in Al-Jubail Industrial City. The acetyl complex is expected to start-up in 2008. Terms of the agreements were not disclosed. Eastman’s acetyl co-production technology will allow for production of acetic acid and acetic anhydride at a cumulative capacity of 460,000 tons per year. In addition to the technology license, Eastman will provide technical support and market all acetic anhydride produced from the facility. According to Ahmed Al-Ohali, president of Sipchem, “The acetyl complex represents our planned Phase 2 projects to provide additional growth opportunities for Sipchem and continuing success on our journey to produce value-added products and superior returns for our shareholders. Combined with the natural gas feedstock from Saudi Aramco and methanol from Sipchem's affiliate International Methanol Company located at the same site, we have planned a world-class complex in terms of technology, partners and value-creating potential." Sipchem had previously announced acquiring licensing rights from DuPont for vinyl acetate monomer (VAM). Ron Lindsay, vice president and general manager of Eastman’s performance chemicals and intermediates business, said, “This agreement leverages the proprietary technology and know-how of Eastman and combines those with Sipchem's strengths within Saudi Arabia to provide a win-win opportunity for both parties. This second source of acetyls for Eastman will allow us to reliably meet the long-term, growing needs of our global acetic anhydride customers, particularly within the Asia Pacific region.” |
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