Qatar Petroleum and ExxonMobil Announce Commencement of Major Activities for Qatargas II Project

IRVING, Texas--(BUSINESS WIRE)--Dec. 15, 2004--At a press conference in Doha today, Qatar Petroleum and Exxon Mobil Corporation (NYSE:XOM) announced that the companies are commencing a number of significant activities to advance the $12 billion Qatargas II project, which will supply LNG from Qatar to the United Kingdom by the winter of 2007/8. Qatargas II is a joint venture between Qatar Petroleum (70 percent) and ExxonMobil (30 percent).

Making the announcement were His Excellency Abdullah bin Hamad Al-Attiyah, Second Deputy Prime Minister and Qatar Minister of Energy and Industry, and Harry Longwell, Director and Executive Vice President, Exxon Mobil Corporation.

Several milestones have been reached that are critical to the implementation of the project, which is the largest integrated LNG project ever undertaken. These include:

    --  Letters of authorization have been signed with Engineering,
        Procurement and Construction (EPC) contractors for the
        construction of platform topsides, pipelines and two 7.8
        million-ton-per-year (MTA) LNG trains at Ras Laffan Industrial
        City in Qatar that set new standards for scale and efficiency.
        Value of the associated contracts is approximately $4.5
        billion.

    --  Qatargas II and South Hook LNG Terminal Co. Ltd. signed
        financing documents securing funds to execute the project.
        Qatargas II entered into funding agreements totaling $ 6.5
        billion of debt and South Hook LNG Terminal Co. entered into
        funding agreements totaling 600 million pounds sterling. In
        total, $7.6 billion was raised from 57 institutions, the
        largest energy project financing ever, and the first ever
        financing on a full LNG chain-integrated basis.

    --  The formation of two new companies to manage the LNG
        importation, terminal operations and sales of natural gas to
        ExxonMobil Gas Marketing Europe (100 percent ExxonMobil owned)
        for sale, in turn, to U.K. markets. Qatar Petroleum or its
        affiliates own 70 percent of the new companies, with
        ExxonMobil or its affiliates holding the remaining 30 percent
        equity interest.

    --  Execution of sales and purchase agreements in support of the
        above activities.

    These agreements follow those announced last month:

    --  A $700 million EPC award to Chicago Bridge & Iron of The
        Woodlands, Texas, to construct the first phase of the
        receiving terminal at Milford Haven in South Wales.

    --  Twenty-five-year time charters for eight LNG transport ships
        (209,000-216,000 cubic meters) with two consortiums,
        ProNav-Commerzbank-Qatar Gas Transport Company and Overseas
        Shipholding Group-Anglo Eastern-Qatar Gas Transport Company.
        These state-of-the-art vessels will be 50 percent larger than
        conventional LNG ships, providing additional project
        economies.

At the press conference, Minister Al-Attiyah said, "The Qatargas II project is a major achievement that will provide the U.K. a significant additional source of natural gas and strengthen the ties between Qatar and the U.K. Working together with our partner ExxonMobil, we have been able to significantly reduce the costs of delivering LNG to the U.K. and so create a strong financeable project. A project of this size and complexity is only possible through the combined strengths of two world class companies, the excellent working relationship that exists between the two companies and the hard work of their staff. I would like to extend our sincere thanks to all the staff of Qatargas II project companies and QP Gas Development Group, as well as the staff in the parent companies, who have worked so hard to bring this exciting day to fruition. This is a proud day for the project's sponsor companies, Qatar Petroleum and ExxonMobil."

Harry Longwell said, "ExxonMobil is extremely proud of our partnership with Qatar Petroleum and we believe the proprietary technologies we have jointly developed for this project, alongside our project management expertise and the sound underlying commercial arrangements announced today create the foundations of a very strong project."

The announced agreements are extensions of a 2002 Heads of Agreement between Qatar Petroleum and ExxonMobil for development of two LNG trains to supply LNG to the U.K. The feed gas for these trains will be sourced from Qatar's giant North Field, which has estimated recoverable natural gas resources in excess of 900 trillion cubic feet. Qatar Petroleum has a 70 percent equity interest in the integrated project and ExxonMobil 30 percent.

Cautionary Statement: Estimates, expectations, and business plans in this release are forward-looking statements. Actual future results, including project plans, costs, timing, and capacities and actual gas recoveries could differ materially due to factors including changes in long-term oil and gas price levels or other market conditions affecting the oil and gas industry; political or regulatory developments; the outcome of commercial negotiations; changes in technology; the actions of competitors; reservoir performance; timely completion of development; technical or operating factors; and other factors discussed here and under the heading "Factors Affecting Future Results" included in Item 1 of ExxonMobil's most recent Form 10-K and posted on our website (www.exxonmobil.com). The milestone agreements and expected commencement of activities relating to the Qatargas II project and the South Hook Terminal in South Wales, U.K., have been taken following approval by OFGEM in the U.K. of an exemption from the second gas directive and in expectation that this decision will be supported by European Union authorities in January 2005. References to gas quantities may include amounts that are not yet classified as proved reserves but that we believe will ultimately be produced.

    CONTACT: ExxonMobil
             Bob Davis, 713-656-7544

    SOURCE: Exxon Mobil Corporation