Eastman to Expand Acetate Tow Production

Eastman Chemical Company (NYSE:EMN) has announced plans to expand production of Estron (R) acetate tow at its Eastman Chemical England Limited (ECEL) facility in Workington, England. ECEL is a wholly owned subsidiary of Eastman. The capital expenditure for the expansion project was not disclosed.

Richard L. Johnson, group vice president for Eastman's chemicals and fibers businesses, said, "The demand for acetate tow continues to grow, particularly in our Europe, Middle East and Africa region and in our Asia Pacific region. As the requirements of our customers grow, we must be able to ensure continued supply of their acetate tow needs."

The production expansion, amounting to approximately 9,000 metric tons (MT), will increase annual capacity at the Workington facility from 15,000 MT to 24,000 MT. The expansion will create approximately 100 temporary jobs during construction and approximately 25 new permanent jobs at the Workington facility. When the expansion is completed during the first half of 2008, Eastman's total worldwide capacity for acetate tow will exceed 180,000 MT. Acetate tow is used as a raw material for the manufacture of filters for cigarettes.

"As a supplement to this new capacity, Eastman will continue to import a significant quantity of tow from its Kingsport, Tenn., U.S.A., facility into the Europe, Middle East and Africa region to support the regional demand growth for cellulose acetate tow," said David Speicher, regional business director for Eastman's fibers business.

According to Johnson, Eastman continues to consider adding capacity in the Asia Pacific region, where growth in demand for acetate tow is high. "Additional capacity will be needed in order for Eastman to maintain its global market share and to meet the growing demand from our customers around the world," he said.

Eastman manufactures and markets chemicals, fibers and plastics worldwide. It provides key differentiated coatings, adhesives and specialty plastics products; is the world's largest producer of PET polymers for packaging; and is a major supplier of cellulose acetate fibers. Founded in 1920 and headquartered in Kingsport, Tenn., U.S.A. Eastman is a FORTUNE 500 company with 2005 sales of $7 billion and approximately 12,000 employees. For more information about Eastman and its products, visit www.eastman.com.

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