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Dow and Binhua sign memorandum of understanding for new JV in China

March 30/2011

(Dow) -- The Dow Chemical Company and Befar Group Co., Ltd. announced a memorandum of understanding (MOU) for a new 50-50 joint venture to produce perchloroethylene (PCE), a key building block material for non-ozone depleting refrigerants used in industrial, automotive, consumer, commercial, building and construction, and other applications.

Under the MOU the two companies will explore development of a new, world-scale, PCE manufacturing facility in Binzhou, Shandong Province, China. The new facility would have an initial target capacity of 40 KTa, with the ability to double production to 80 KT soon thereafter. Assuming the terms and milestones of the MOU are met and subject to customary government approvals, Dow and Binhua estimate production would begin in 2014.

According to Dow President of Chemicals & Energy, Carol Williams, the proposed joint venture with Binhua is another critical milestone toward fulfillment of the Companys business strategy.

Global demand for PCE as a feedstock is increasing for non-ozone-depleting fluorocarbon refrigerants in industrial, automotive and home applications. In China, the market for PCE is growing rapidly, but to date, local supply has been limited. The proposed Dow-Binhua joint venture is designed to meet this significant market opportunity.

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