1. Honam Petrochemical Corp. Lotte-Kwanak Tower Bldg.,395-67 Shindaebang-dong,Dongjak-ku, Seoul, Korea. (ZIP: 156-012) Tel 82-2-829-4114 Fax 82-2-834-6070

2. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 1 1 About Honam & Affiliates 2Business Overview 3Financial Review

3. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 2 Company History  Mar.1976Established the Company  Dec.1979Started commercial production of HDPE, PP and MEG Plants  Jun. 1986Established R&D Institute  Apr.1988Completed 2nd HDPE plant  Nov.1988Completed 2nd PP plant  May.1991Listed on the Korea Stock Market  May.1991Completed 2nd MEG plant  Apr.1992Completed Naphtha Cracker(Ethylene Plant) and BTX plants  Jun. 1997Completed 3rd MEG plant  Aug. 1998Completed PET plant  Jun. 1999Completed 3rd HDPE plant  Mar.2000Completed EOA plant  Jun. 2001Completed MMA plant  Nov.2001Completed Naphtha Cracker and BTX plant Revamping  Nov.2001Completed 3rd PP plant  Jul. 2003Completed Power plant  Jun. 2003 Acquired Hyundai Petrochemical With LG Chem.  Nov. 2004 Acquired KP Chemical

4. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 3 NCCCompletion(1992) NCCRevamping(2001) HPP HPE HEG POP SPE SPP SEG NCC BTX 3EG PET 3PE EOA 3PP MMA HyundaiPetrochemicalAcquisition(2003) KPAcquisition(2004) Plant Operation Historical Trend (Unit:EA)

5. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 4 SHAREHOLDERS Lotte Mulsan Co., Ltd. (Korea)33.6% (Korea)33.6% Public(Korea)42.7%Public(Korea)42.7% Hotel Lotte Co., Ltd. (Korea)13.6% (Korea)13.6% Lotte (Japan) 10.0% 10.0% Public(Korea)47.5%Public(Korea)47.5% Honam52.5%Honam52.5% Honam Petrochemical Lotte Daesan Petrochemical KP Chemical Honam 100%

6. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 5 LOCATION Honam Petrochemical (Yeosu Plant) Lotte Daesan Petrochemical (Daesan Plant) KP chemical (Ulsan Plant) SEOUL (Head Office) DAEJEON (R&D Institute) Head Office, R&D Plant Site Overseas Branch Shanghai, Guangzhou, Hongkong, Beijing, Moscow

7. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 6 1About Honam & Affiliates 2 Business Overview 3Financial Review

8. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 7 Products Propylene (365,000) HDPE (370,000) Ethylene (720,000) Mixed C4 Pyrolysis Gasoline EO Naphtha Cracking Center (2,200,000) MEG (400,000) PET (70,000) PP (380,000) Compound Resin (40,000) EOA (30,000) MMA (43,000) Benzene (150,000) Toluene (78,000) Xylene (47,000) Honam Petrochemical

9. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 8 Products LDPE (140,000) Ethylene (600,000) Naphtha Cracking Center (1,900,000) EO MEG (250,000) Mixed C4 Pyrolysis Gasoline Benzene (170,000) Propylene (300,000) PP (250,000) LLDPE (160,000) SM (250,000) Butadiene (80,000) Lotte Daesan Petrochemical

10. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 9 Products Para-Xylene (700,000) Benzene (102,000) Ortho-Xylene (255,000) Mixed Xylene (1,100,000) PTA (1,080,000) PET (396,000) ※ P-X Capacity : 700,000 (Metha-Xylene 61,000 included), PTA Capacity : 1,080,000 (PIA 87,500 included) Metha-Xylene & PIA productions are flexible. KP Chemical

11. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 10 생산제품 Total [Unit : 1,000MT/year]

12. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 11 Sales by Distribution Channel  Honam is one of the most preferred suppliers in Asia Pacific based on the advanced manufacturing technology, aggressive marketing and R&D activities. Sales by Product Honam PetrochemicalSales Breakdown - Year 2005 (FH) DOMESTI C 51% 51% LOCA L 29% 29% EXPOR T 20% 20% PP21%PP21% EOG21%EOG21% BTX15%BTX15% OLEFIN12%OLEFIN12% PET5%PET5% Etc.6%Etc.6% HDPE20%HDPE20%

13. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 12 HDPE PP Year 2005 (FH) HONAM26%HONAM26% SK15%SK15% Honam21%Honam21% DIC19%DIC19% LG Chem 13% 13% KPIC13%KPIC13% ST 10 % ST PolyMirae13%PolyMirae13% KPIC12%KPIC12% LG Daesan 10% 10% Hyosung8%Hyosung8% Domestic M/S (Local Included) SK12%SK12% LGDaesan8%LGDaesan8% Lotte Daesan 4% 4% GSCaltex8%GSCaltex8% ST9%ST9%

14. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 13 MEG Honam56%Honam56% LGDasan8%LGDasan8% LotteDaesan21%LotteDaesan21% ST15%ST15% Domestic M/S (Local Included) Year 2005 (FH)

15. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 14 Price Trend of Raw Materials ※ Naphtha price trends(C&F Japan) / Ethylene price trends(C&F Korea)

16. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 15 Market Conditions HDPE / PP ※ HDPE(Yarn/Injection) / PP(HOMO) price trends(C&F F.E. AISA)

17. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 16 Market Conditions MEG ※ MEG price trends(Asia Contract Price)

18. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 17 1About Honam & Affiliates 2Business Overview 3 Financial Review

19. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 18 I/S B/S Financial Review ※ Honam executed assets revaluation in 1999 and the revaluation excess is 457 billion won. Honam Petrochemical

20. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 19 I/S B/S Before Splitting Financial Review ※ Split into 3 Companies on Jan 1, 2005. ☞ No.1 Complex : LG Daesan, No.2 Complex : Lotte Daesan, Utility Part : Seetec Hyundai Petrochemical

21. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 20 I/S B/S Financial Review ※ Kohap Group→ KP Chemical on December 28, 2001. KP Chemical

22. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 21 [Unit : Billion Won] Financial Review – Balance Sheet Year 2005 (FH)

23. 湖南石油化學 ( 株 ) Honam Petrochemical Corp. 22 Financial Status Cash Inflow from Recurring Profit Cash Inflow from Recurring Profit and Non-cash Expense and Non-cash Expense : ￦ 502 billion won (’04) : ￦ 502 billion won (’04) No Cross Guarantee No Cross Guarantee “HPC runs in the most stable financial structure among the Korean petrochemical companies.” Debt Ratio Net Debt [Unit: Billion Won] Honam Petrochemical