Phillips Announces License Agreement with Formosa Plastics

Business Wire, July 14, 1998

BARTLESVILLE, Okla.--(BUSINESS WIRE)--July 14, 1998--

License Enables Formosa to Build New

250,000 Metric-Tons-Per-Year Facility in Texas

Phillips Petroleum Company (NYSE: P) announced today it has licensed its loop slurry technology for polyethylene to Formosa Plastics Corp., Texas. The agreement strengthens Phillips' reputation as a leader in polyethylene technology, and marks the second such U.S. license in the last two years.

The licensing agreement enables Formosa to build a new single-train 250,000 metric-tons-per-year (550 million pounds-per-year) facility at Point Comfort, Texas. The plant initially will produce medium- and high-density polyethylene resins, and will have the capability of using Phillips' proprietary metallocene catalyst technology to produce metallocene-based linear low-density polyethylene resins. Startup is expected in early 2001.

The Phillips loop slurry technology is the most widely used process in the world for manufacturing medium- and high-densitypolyethylene -- plastics used in milk jugs, toys, trash bags and plastic pipe. The technology is licensed in 14 countries.

"This new license demonstrates an aggressive leadership position for Phillips in the U.S. plastics industry to meet the expanding demand for our key grades of polyethylene," said John Mihm, senior vice president, corporate technology. "The license is part of Phillips' strategy to grow our chemicals and plastics business by building on our technological strengths and expertise."

Formosa Plastics Corp., Texas, a privately held firm headquartered in Livingston, N.J., is the 11th largest producer of polyethylene in the United States.

Phillips is a major polyethylene producer. It operates a 2 billion-pounds-per-year plant at its Houston Chemical Complex, which will be expanding to 2.2 billion pounds by year-end 1998.

In addition, Phillips operates a joint-venture polyethylene complex in Singapore, with an annual capacity of 860 million pounds per year, and recently started up a 220 million-pounds-per-year joint-venture facility in China.

Phillips is an integrated petroleum company with 17,200 employees worldwide. Founded in Bartlesville, Okla., in 1917, the company has $14 billion of assets and $13 billion of revenues on an annual basis.

   CONTACT:  Phillips Petroleum Company
              Vernon Johnson, 918/661-4974