We take pleasure in announcing that a consortium made up of JGC Corporation, Kellogg Brown & Root, Inc., JGC (Malaysia) Sdn. Bhd., Kellogg (Malaysia) Sdn. Bhd., and Sime Engineering Sdn. Bhd., has been awarded a contract by Malaysia LNG Tiga Sdn. Bhd. to construct Phase 3 of the Malaysian LNG production complex, which will make the complex the single largest in the world when completed.

Malaysia LNG Tiga Sdn. Bhd. is a joint venture of PETRONAS, Nippon Oil (Netherlands) B.V., Shell Gas B.V., the Sarawak State Government of Malaysia and Occidental LNG (Malaysia) Sdn. Bhd.. More details of this award are as follows:

1. Owner :
Malaysia LNG Tiga Sdn. Bhd.

2. Location of Construction:
Bintulu, Sarawak, East Malaysia

3. Contractual Conditions:
Contractual services : Engineering, procurement, construction and commissioning Contract form : Lump-sum, turnkey

4. Contract Price:
Approx. US$1.5 billion (Approx. ¥157.5 billion)

5. Scheduled Completion:
Train 1 : November 2002
Train 2 : August 2003

6. Project Outline:
This is a project to build up to 7.6-million ton-per-year LNG plant plus offsite facilities, adjacent to the Malaysia LNG Phase-1 plant (design capacity of 2 million tons per year/train x 3 trains) completed in 1983 by a JGC/M.W. Kellogg (present KBR) consortium and the same Phase-2 plant (design capacity of 2.60 million tons per year/train x 3 trains) completed in 1995 by the same consortium. Completion of this Phase-3 plant will make the LNG complex the largest in the world, as a single LNG complex, with a production capacity of approximately 23 million tons per year. This project itself is one of the world's largest, as a single LNG project.

Two-train liquefaction facilities, each with an annual production capacity of up to 3.8 million tons per year, are to be built along with an LNG tank with a storage capacity of 120,000 cubic meters. Feedstock is the natural gas from the reserves some 110 km off Bintulu. In each phase, this LNG complex has incorporated the state-of-the-art technologies available at that point. This new plant uses the latest available LNG technologies, featuring air-cooling throughout the facilities, employment of a gigantic gas turbine, and a high-efficiency design that maximizes the utilization of the turbine's power. This plant boasts the world's largest annual production capacity per train.

7. Others:
In awarding this contract, the client is believed to have thoroughly evaluated the technical capability of the JGC/KBR consortium that built the existing two LNG plants, as well as the two companies' extensive construction experience in Malaysia, including the LNG plants, refineries, GTL and ethylene plants constructed in Malaysia by JGC.

For this particular project, JGC and other consortium partners will make maximize Malaysia contents or participation with a minimum target of 30% of contract Lump sum value.

JGC boasts a wide range of services in the natural gas processing area, from gas gathering, liquefaction, storage to shipping and receiving. JGC's major LNG plant achievements include installation in 1973 of an LNG plant in Brunei, which was the first LNG plant ever built by a Japanese contractor, followed by two projects in Malaysia, one in Australia, two in Nigeria, one in Qatar, and one in Indonesia, already completed or under construction.