NEWS BULLETIN

February 28, 2001 --- Vol. 7, No. 24February 2001

Phillips orders fifth millennium class tanker for Alaska trade

Phillips Petroleum Co. said Feb. 28 that it has ordered a fifth millennium-class oil tanker for the Alaska trade. The tanker is valued at more than $205 million.

Polar Tankers Inc., Phillips' tanker subsidiary, will christen its second millennium-class double-hulled tanker, the Polar Resolution, March 3 at Litton Avondale Industries shipyard in New Orleans.

Phillips said the millennium-class tankers are the first crude-oil carriers to be built for the Alaska trade in compliance with the federal Oil Pollution Act of 1990. The first of the tankers, Polar Endeavour, will enter the Alaska trade this spring. The Polar Resolution will be delivered in late 2001.

"The decision to build a fifth millennium-class tanker reflects Phillips' plan to increase our daily Alaska production from a current level of 350,000 barrels of oil equivalent to about 375,000 to 400,000 barrels of oil equivalent for the foreseeable future," Phillips Chairman and Chief Executive Officer Jim Mulva said in a statement.

Litton Avondale has four 125,000-deadweight ton crude oil carriers under construction for Polar Tankers. Along with the award of the fifth ship, Litton Avondale and Polar Tankers agreed to options for a sixth and seventh ship. The option for the sixth ship is subject to exercise in the third quarter of 2001, and the seventh during the fourth quarter of 2001.

Phillips said the millennium-class tankers are being built to meet or exceed existing and proposed environmental regulations and will set new standards for innovation and environmental protection. They were designed for the transport of crude oil from Valdez to the West Coast and will also deliver cargo to Hawaii.

The double-hulled ships have double independent engine rooms, twin propellers and twin rudders. Phillips said the millennium-class vessels will isolate cargo, fuel and lubricating oils from the ship's side by ballast tanks or void spaces.

The company said the vessels also meet pending regulations for air emissions from engines and are painted with tin-free anti-fouling paint in deference to proposed regulations.


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