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Dow Signs HPPO Joint Venture Agreement with BASF


WEBWIRE –

Midland, MI - March 08, 2006, The Dow Chemical Company announced today that it has signed a joint venture agreement with BASF to construct a new propylene oxide manufacturing facility using the recently co-developed hydrogen peroxide route to propylene oxide (HPPO) technology. Construction of the new 300,000 MT plant will begin this year with startup planned in early 2008. Financial terms of the transaction were not disclosed.

"HPPO is an attractive, lower-cost, and commercially-viable process for producing propylene oxide" said Earl Shipp, Business Vice President, Dow Oxides and Glycols. "BASF has been a great partner for us since we began co-developing HPPO technology in 2003"

The joint venture will build and operate the commercial-scale HPPO plant in Antwerp Belgium. A separate joint venture company will own and further develop the HPPO (hydrogen peroxide route to propylene oxide) technology. The two companies will have equal off-take rights to the PO produced by the Antwerp plant.

Dow and BASF first announced that they would combine their research efforts to expedite the development and commercialization of HPPO technology in August 2002.

Dow considers the development of additional projects in Asia using the HPPO technology a priority and it is currently studying various alternatives and potential locations for future PO investment.

Dow is a diversified chemical company that harnesses the power of science and technology to improve living daily. The Company offers a broad range of innovative products and services to customers in more than 175 countries, helping them to provide everything from fresh water, food and pharmaceuticals to paints, packaging and personal care products. Built on a commitment to its principles of sustainability, Dow has annual sales of $46 billion and employs 42,000 people worldwide. References to "Dow" or the "Company" mean The Dow Chemical Company and its consolidated subsidiaries unless otherwise expressly noted.

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