Yokohama, Japan - JGC Corporation announced today that in order to promote the use of Di-Methyl Ether (DME), which has been hailed as the new generation clean fuel, nine companies including JGC have agreed to establish a Joint Venture Company for DME production, and to construct an 80,000 tons per year DME production plant within the Mitsubishi Gas Chemical Company Niigata Factory (Niigata-shi). Operation of the plant is scheduled to start from June 2008, and its production capacity is expandable to 100,000 tons per year. JGC will undertake the construction of this new production plant, and Mitsubishi Gas Chemical will be responsible for its operation.

The nine participants in the joint venture are Mitsubishi Gas Chemical Company, ITOCHU Corporation, Japan Petroleum Exploration Co., Ltd., Taiyo Oil Company, Limited, TOTAL Di-Methyl Ether Japan Ltd., Toyota Tsusho Corporation, JGC Corporation, Mitsubishi Heavy Industries, Ltd. and Mitsubishi Chemical Corporation.

Currently, the main use for DME in Japan is as an aerosol propellant for cosmetics and paints. However, it has already been commercialized in China for use as an LPG substitute because of the similarities of its properties to those of LPG. For this reason, it is regarded as an attractive alternative in the search for a source of future clean energy for fuel use, since it does not cause soot (Particulate Matters; PM) as a diesel fuel substitute, and could easily be produced from natural gas and coal etc. via methanol.

The Japanese government has mentioned DME promotion as an important matter in their "Basic Energy Plan", and has supported technology developments for DME production and application. These nine participants will be developing further promotion in line with this national policy.

These joint venture partners will make efforts for future commercialization through promotion activities to apply DME produced from this new plant to boilers, power plants (including fuel cells), automobiles, etc.