Position in the industry

1
Position in the industry
petrochemicals only
2
Sector definition
Value Added
3
Strategy
Ambition
Discipline

• Expand in Aromatics driven by our PX/PTA
  leadership position
• Enhance distinctiveness in Olefins Polymers
• Focus Related Business portfolio based on
  advantaged positions

• Low cost/ high efficiency
• Biased to higher growth
• Leading market positions
• World leading technology
• Add value to group hydrocarbons

4
Highlights

• Intended purchase of Bayers share in
  Erdoelchemie
• Further polyethylene expansion at Grangemouth
• Progress on Shanghai cracker
• YARACO success
• ChemConnect investment
• Engineering Polymers sale announced

5
Progress report to existing targets
bn
What we said in July 1999
What we did by end 1999
What we aim to do in2000
Costs
0.4
0.2
0.2
Disposals
2.4
0.6
0.1
Gross capex
4.6
1.2
1.6
6
Unit cost reductions
Delivery on target
per tonne
Baseline
200
Target
150
100
50
0
1998
2003
2001
2000
1999
2002
7
Capital efficiency
More product for every dollar
Tonnes per 000s
Million tonnes
2.2
25
Capital efficiency
Volume
2.1
2.0
1.9
20
1.8
1.7
1.6
15
1999
1998
1997
1996
8
Volume growth
Ahead of the industry
Volume index 1990 100
170
GDP
Industry
160
BP Amoco
150
140
130
120
110
100
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
9
Competitive position
From laggard to leader
Post tax return on sales ranking
1st
15th
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
10
Aromatics leadership
Growth in line with market
Current capacity
Expansion plans
New applications
Economic development
Technology leadership
Capital efficiency
11
Olefins Polymers strengthening
Building advantaged sites
Rotterdam
Marl
Terneuzen
Erdoelchemie
Antwerp
Geel
Feluy
BP Amoco sites
Frankfurt
Other sites
Olefin pipelines
Ludwigshafen
Feedstock pipelines
12
Related Business - BDO
Cost leadership through technology
Production Costs
Other Producers
100
Typical Producers
BDO1
50
BDO2
0
Cumulative capacity
13
Capital expenditure
2001 - 2003 total 6 bn
Olefins Polymers 47
Aromatics 27
Related Business 26
14
Shape of the new company
Ambition
Action
Expand driven by leading PX/PTA position
New builds China
Aromatics
Enhance distinctiveness
Advantaged sites Erdoelchemie
Olefins Polymers
Focus portfolio on distinctive positions
Technology linkage BDO
Related Business