Interview with Mr Henry Roth

MEGlobal will actually celebrate five years of operation in 2009, as a joint venture which combines Dow's strong existing asset base, technology position and market presence with PIC's commitment to increasing its investment in downstream petrochemical markets.

Since the company’s launch in 2004, we have proven the capabilities of a global commodity business model that combines the strengths of regional industries so that the whole is greater than the sum of its parts, providing our customers with a consolidation of diverse and authoritative expertise that they cannot get from any other supplier. And one which has, I believe, exceeded the expectations of both our parent companies in its sole focus and success by being a world leader in the Ethylene Glycol (EG) industry.

MEGlobal has a sole focus on everything in EG. We are a world leader in the manufacture, supply and marketing of merchant monoethylene glycol (MEG) and diethylene glycol (DEG), collectively known as ethylene glycol (EG). We manufacture and sell around 1.0 million metric tonnes of EG per year produced at our three manufacturing plants in Canada and in addition, market in excess of 2.5 million metric tonnes from our world-leading supply partners, Dow, EQUATE Petrochemical Company and Optimal Glycols.

Trade frictions are inherently negative for a business tied to and committed to global trade and exchange of goods. While we have not seen pronounced changes in market demand, fluctuations have occurred as polyester producers are coping with changed regulatory requirements pertaining to export and import.

The recent months have demonstrated the volatility more drastically than ever before and this volatility has created severe strains in the margin generation capability of all participants of the product stream. The volatility does not always allow adjusting pricing to the changed cost structure, therefore making planning at sustainable or reinvestment levels is very difficult for the participants in our business.

The prospects of the polyester industry worldwide remain excellent. This particular industry has not only seen exceptional growth rates in the past few years, but importantly, because of the ever-widening application base for polyester, the outlook remains positive.

China has moved itself into an absolutely dominant position within the polyester industry. However, more generically speaking, any country that can combine high productivity at low cost with the required technical standards for product acceptance in global markets can be successful in this business.

The demographics in terms of population, consumption and spending power would predict that the Far East will be a major focal point for petrochemicals.

MEGlobal fully supports the objectives of REACH and the responsibility that legislation places on all members of the value chain to manage the safe use of chemicals. Working with CEFIC, the European Chemical Industry Council, we have been actively engaged in supporting effective and workable legislation, and are now shifting our attention to work with our customers and suppliers on REACH implementation.

As a joint venture of The Dow Chemical Company (Dow) in the US, MEGlobal is working through Dow’s REACH implementation program management office, preparing to meet the compliance requirements of the legislation. MEGlobal will ensure pre-registration of its products, monoethylene glycol (MEG) and diethylene glycol (DEG), with assistance from Dow’s corporate expertise and service functions.

We anticipate that our current product portfolio will be registered for typical downstream uses pending further technical guidance.

Thank you. MEGlobal is very proud of the EnviroVista leader recognition and is one of only 30 facilities in Alberta, Canada honored for outstanding performance that exceeds the expectations of the province’s environmental legislation and demonstrates responsibility, product stewardship and an ongoing commitment to improving environmental performance.

With regard to our CSR efforts, our company plays an active role in the communities in which we operate and are committed to enhancing the quality of life wherever we can. Our community contributions program supports projects that align with at least one element of sustainable development; economic prosperity, social responsibility or environmental stewardship.

For instance, MEGlobal is a major sponsor of the Ellis Bird Farm, a working farm and non-profit organization dedicated to the conservation of Mountain Bluebirds, Tree Swallows and other native cavity-nesting birds which is located opposite our Prentiss manufacturing site in Red Deer, Canada. We also sponsor one of the all-hybrid electric bus fleet in the town of Banff, Canada, North America’s first known municipality to have an entire public transit fleet of hybrid vehicles.

MEGlobal employees are also encouraged to be active members of their communities. Our Employee Involvement Program is designed to recognize, encourage and support the active volunteer efforts of employees who contribute their time to registered charities and non-profit community service organizations with an annual donation. Since the program’s inception in 2005, MEGlobal has donated more than $10,000 to this effort.

And following this years major earthquake that devastated China’s Sichuan province in May, MEGlobal donated RMB 500,000 to the Red Cross in China to support ongoing relief efforts in the country where many colleagues and customers were affected by this natural disaster.

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