PRESS RELEASE (12/12/2004)

OMAN METHANOL COMPANY PROCURES FINANCING FOR THE FIRST PHASE OF METHANOL PROJECT

Oman Methanol Company LLC has executed all the project, financing and government direct agreements for achieving the financial close for the first phase of its methanol project. The signing ceremony for the sub-usufruct agreement and the direct agreement with SIPC and the direct agreements with the Government of Oman, took place on 12th December 2004. H.E. Dr. Omar Zawawi signed various agreements on behalf of the Oman Methanol Company LLC. On behalf of the Government of Oman, H.E. Ahmed bin Abdul-Nabi Macki, the Minister of National Economy, signed the seawater extraction agreement and the government direct agreements for seawater extraction. He also signed the government direct agreement for sub-usufruct rights along with H.E. Shaikh Mohammed bin Abdullah Al-Harthy, the Minister of Transport & Communications, and the government direct agreement for supply of natural gas along with H.E. Dr. Mohammed bin Hamad Al-Rumhy, the Minister of Oil & Gas. KfW signed all the direct agreements as the lenders to the project. Government officials and representatives of Oman Methanol Company and its shareholders were also present at the signing ceremony.

Project and financing related documents including Loan Agreement with KfW have already been signed. By signing these documents, Oman Methanol Co. has procured financing for the first phase of its methanol project, which will have a production capacity of 3000 tonnes per day.

The plant for the first phase is being designed by Toyo Engineering Corporation, Japan, whereas MAN Ferrostaal AG would be the contractors for the supply of engineering and equipments and Oman Proman Contracting & Trading LLC would be carrying out all the works for construction, start up and commissioning of the plant.

The Oman Methanol Co. has already finalised its arrangements for sale of 100% of its product with Helm AG. Though, the construction schedule for the plant is of 30 months, yet both, the company and the contractors, are hopeful of commencing commercial production by end of 2006 due to the early works undertaken by the contractors.