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e e LYONDELL-MILLENNlUM PARTNERSHIP - Page 2 The Venture Creates Value Through Cost Reductions, Operating Efficiency Improvements and Broader Product Mix "We will create a new world-class chemical company, with enhanced asset utilization and a leading cost position across a broad line of products, by blending assets, employees and operating capabilities from Millennium and Lyondell," said Dan F. Smith. "The extraordinary fit of these businesses will provide higher earnings power and create unique value that we expect will be differential in the industry." "The venture will have one of the broadest product lines in the industry, with extensive product development and research capabilities and the best employees from each organization, enabling it to better seIVe customers in rapidly growing markets," said William M. Landuyt. The partnership is expected to generate more than $150 million in annual pre-tax profit improvement. Substantial savings are expected to be realized early, with the full $150 million annual savings achieved by the end of 1999. . Cost improvements will be achieved in such areas as eliminating duplicate overhead and staffing, improved purchasing capabilities, and better utilization of existing logistics and distribution channels. . Efficiency improvements will include such items as greater use of feedstock flexibility, expanding the upgrade of co-products internally, sharing best business practices, and optimizing production scheduling of polymer plants. . Customers will benefit from the greater supply flexibility gained through multiple olefins production sites and polymers customers will have access to significantly broader resin product lines. "This transaction is a major step in the execution ofLyondell's strategy to reduce cyclicality and grow the petrochemicals business through greater integratiun and a broader downstream product mix. It also advances our low cost strategy by compounding the benefits of recent cost reduction efforts and building a base for future improvements. Increased cash flow generated by this venture, as well as our interest in L YONDELL- -MORE-