Eastman Announces Changes in Ownership of Industrial Gasification Projects

Business Wire, June 3, 2008

KINGSPORT, Tenn. -- Eastman Chemical Company (NYSE: EMN) today announced the acquisition of Green Rock Energy LLC's 50 percent ownership interest in the Beaumont, Texas, industrial gasification project. With this acquisition, Eastman becomes the 100 percent owner of the Beaumont industrial gasification project and remains the sole developer. In addition, Eastman announced the divestiture to Green Rock of its 25 percent ownership interest in the St. James Parish, La., industrial gasification project and will no longer participate in the project. Terms of the transactions were not disclosed.

Richard Lorraine, Eastman senior vice president and CFO, presenting today at an investor conference in New York said, "We have confidence in the success of both the Texas and Louisiana industrial gasification projects, however differences in strategic criteria led us to agree with Green Rock to end our joint investment." Lorraine continued, "We are extremely pleased to become the sole owner and developer of the Beaumont industrial gasification project. It remains on track with the previously announced development milestones and we expect it will contribute approximately $2 of corporate earnings per share. We also continue to pursue additional industrial gasification projects that meet our investment criteria."

Eastman expects to complete the front-end engineering and design for the Beaumont gasification facility in the second half of 2008, and to obtain non-recourse project financing by year end 2008. The construction phase is expected to create between 1,300 and 1,500 jobs, with approximately 250 permanent U.S. based jobs expected to result from the project.

Eastman manufactures and markets chemicals, fibers and plastics worldwide. It provides key differentiated coatings, adhesives and specialty plastics products; is a major supplier of cellulose acetate fibers; and produces PET polymers for packaging. As a Responsible Care[R] company, Eastman is committed to achieving the highest standards of health, safety, environmental and security performance. Founded in 1920 and headquartered in Kingsport, Tenn., Eastman is a FORTUNE 500 company with 2007 sales of $6.8 billion and approximately 10,500 employees. For more information about Eastman and its products, visit www.eastman.com.

Forward-Looking Statements

Certain statements in this news release concerning Eastman's industrial gasification projects, plans, and initiatives, including project development and financing milestones and projected financial performance of and corporate earnings contributions from industrial gasification projects, are forward-looking. Such statements are based upon preliminary information, internal estimates, management assumptions, expectations, and projections and are subject to a number of risks and uncertainties inherent in projecting future conditions, events, and results. Important factors that could cause actual results to differ materially from the expectations expressed in the forward-looking statements, in addition to those identified with such forward-looking statements, are and will be detailed in the company's reports filed with the Securities and Exchange Commission, including the Form 10-Q for the quarter ending March 31, 2008.