Skanled Fully Financed

British Ineos will take on the full ownership--or, alternatively, a majority share--of the gas separation unit in Bamble, Norway.

Further, Gassco informed that agreements have been signed for 100 % ownership in the planned pipeline (Skanled) from Karsto to Eastern Norway, Western Sweden and Denmark together with additional transportation commitments in the pipeline system. Investment decisions will be made in 2009 with a possible start-up of the pipeline in 2012. Efforts are still needed before a decision to build the pipeline can be made. Gas sales agreements between the companies and gas producers are needed, as well as approvals by relevant authorities in the different countries.

"With today's announcement we have moved closer toward a realization of gas deliveries to Eastern Norway, Sweden and Denmark. A massive effort has been made to establish the commercial basis for the pipeline and the separation unit in Bamble. Gassco will continue its work to conclude the funding of the separation unit," said Mr. Odd Roger Enoksen, Minister of Petroleum and Energy.

"The pipeline and the gas separation unit may double the feedstock supply to the Noretyl cracker at Rafnes which will allow us to examine options for expansion of the ethylene cracker and further development of the petrochemical activities in Bamble," said Mr. Tom Crotty, Chief Executive Officer Ineos Olefines.

"Ineos has, through its acquisition of Hydro Polymers and Borealis become a central player in the petrochemical industry in Norway. Ineos's investments in the gas separation unit show that the company has industrial ambitions in the Grenland area. I see this as very positive for the employment and future growth in this region," said Mr. Dag Terje Andersen, Minister of Trade and Industry.

The owner group in Skanled has approved to take German E.ON Ruhrgas, Polish PGNiG and Swedish Preem Petroleum as owners in Skanled. Including the new companies, 100 % ownership in the pipeline is now secured. Furthermore, total transport commitments are now 18 million standard cubic meters of gas per day. The new volumes of gas improve the economics of the gas separation unit due to higher ethane recovery.

The date for formal takeover for Ineos of the Borealis AS petrochemical business in Norway and Hydro Polymers is planned for 1 September. Additional investments by Ineos are subject to formal approval of the taking-over of the companies and quality assurance of the work on the gas separation unit.

Shares of ownership in Skanled:

--Skagerak Energi 20%
--E.On Ruhrgas 15%
--PgNiG 15% 10%
--Hafslund 10%
--Ostfold Energi 10%
--Goteborg Energi 8%
--Agder Energi 5%
--Swedegas 5%
--Preem Petroleum 2%