Strengthened engagement in speciality fertilizers

(April 19, 2002) Norsk Hydro has signed an agreement with the private Chilean company SQH to form a new private Chilean company, Inversiones SQNH S.A. where Hydro holds 49%. SQNH is in turn a significant indirect minority shareholder in the Chilean speciality fertilizer company SQM.

After successful completion of an extensive turnaround process, Hydro Agri has emerged as the world's leading fertilizer company with leadership positions in key areas like ammonia, nitrogen based fertilizers, balanced fertilization and a global sales and distribution network.

The speciality fertilizer segment is another of Hydro Agri's core areas and has been developed on the basis of the company's strength in Calcium Nitrate. The segment has a significant growth potential linked to the growing cash crops segment of international agriculture. A global distribution agreement with SQM that was announced earlier this year, was a major step to strengthen both companies' activities in speciality fertilizers, adding Potassium Nitrate from SQM to Hydro's delivery programme and Calcium Nitrate from Hydro to that of SQM.

Last summer Hydro granted a loan to SQH that was linked to an option agreement. A restated and amended version of the option has now been executed, and the USD 28.5 million investment serves to further strengthen Hydro's engagement in speciality fertilizers.

SQM is an integrated producer and distributor of speciality fertilizers and industrial chemicals as well as iodine and lithium. Its products are based on the development of high quality natural resources that allow the company to be the leader in costs. With sales in over 100 countries, SQM's development strategy aims at maintaining and strengthening the world leadership in its three main businesses: speciality fertilizers, iodine and lithium. This leadership strategy is based on the company's advantages and on the sustainable growth of the different markets in which it operates.