MIRA INFORM REPORT

Report Date :

15.11.2007

IDENTIFICATION DETAILS

Name :	LYONDELL SOUTH ASIA PTE LTD
Registered Office :	250 North Bridge Road, 14 – 03 / 04, Rafflls City, Tower, Singapore 179101
Country :	Singapore
Financials (as on) :	31.12.2006
Date of Incorporation :	26.02.2000
Legal Form :	Pte Ltd
Line of Business :	Trading And Supply Of Chemicals For Industrial Use And Providing Administrative Services To Its Related Corporations

RATING & COMMENTS

MIRA’s Rating :

Ba

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Status :	Satisfactory
Payment Behaviour :	Regular
Litigation :	Clear

Subject Company : LYONDELL SOUTH EAST ASIA PTE LTD

Line Of Business  : TRADING AND SUPPLY OF CHEMICALS FOR INDUSTRIAL USE AND PROVIDING

ADMINISTRATIVE SERVICES TO ITS RELATED CORPORATIONS

Parent Company : LYONDELL ASIA PACIFIC LTD

(PERCENTAGE OF SHAREHOLDINGS: 100%)

COMPANY IDENTIFICATION

^{Subject Company : LYONDELL SOUTH ASIA PTE LTD}

^{Former Name : -}

^{Business Address : 250 NORTH BRIDGE ROAD}

^#14-03/04

^{RAFFLES CITY TOWER}

^{Town : SINGAPORE}

^{Postcode : 179101}

^{Country : Singapore}

^{Telephone : 6880 2345}

^{Fax : 6880 2377 / 6880 2378}

^{ROC Number : 200001565W}

^{Reg. Town : -}

SUMMARY

^{Legal Form : Pte Ltd}

^{Date Inc. : 26/02/2000}

^{Previous Legal Form : -}

^{Summary year : 31/12/2006}

^{Sales : 169,085,979}

^{Networth : 8,652,533}

^{Capital : -}

^{Paid-Up Capital : 60,734}

^{Employees : 20}

^{Net result : 2,387,161}

^{Share value : -}

^{Auditor : PRICEWATERHOUSECOOPERS}

PRINCIPAL(S)

^{KHOO TONY S1173512F Director}

DIRECTOR(S)

^{ADRIAN CHAN PENGEE S1658599H Company Secretary}

^{Appointed on : 01/04/2000}

^{Street : 700 LORONG 1 TOA PAYOH}

^#08-02

^{TRELLIS TOWERS}

^{Town : SINGAPORE}

^{Postcode : 319773}

^{Country : Singapore}

^{YANG CHEN-CHEN CHARLES 710073487 Director}

^{Appointed on : 26/02/2000}

^{Street : 2905 PARKSIDE, 88 QUEENSWAY}

^{Town : HONG KONG}

^{Postcode : -}

^{Country : Hong Kong}

^{KHOO TONY S1173512F Director}

^{Appointed on : 26/02/2000}

^{Street : 12 STIRLING ROAD}

^#38-12

^QUEENS

^{Town : SINGAPORE}

^{Postcode : 148955}

^{Country : Singapore}

^{LUN CHEE LEONG S7003795E Company Secretary}

^{Appointed on : 30/09/2004}

^{Street : 60 LORONG 4 TOA PAYOH}

^#23-117

^{Town : SINGAPORE}

^{Postcode : 310060}

^{Country : Singapore}

^{CHARLES WAYNE GRAHAM 426993766 Director}

^{Appointed on : 01/03/2007}

^{Street : SUITE 4937, FOUR SEASONS PLACE}

^{NO. 8 FINANCE STREET}

^CENTRAL

^{Town : -}

^{Postcode : -}

^{Country : Hong Kong}

FORMER DIRECTOR(S)

^{ANG RU-LIN S7442282I}

ACTIVITY(IES)

^{CHEMICALS Code: 3970}

^{TRADING COMPANIES Code: 22190}

^{BASED ON ACRA'S RECORD}

^{1) WHOLEDSALE OF CHEMICALS AND CHEMICALS PRODUCTS;}

^{TRADING OF CHEMICAL PRODUCTS}

CHARGES

No Charges On Premises/Property In Our Database

PREMISES/PROPERTY INFORMATIONS

No Premises/Property Information In Our Databases

SHAREHOLDERS(S)

^{LYONDELL ASIA PACIFIC LTD 100,000 Company}

^{Street : 1221 MCKINNEY HOUSTON}

^{Town : USA}

^{Postcode : 77010}

^{Country : United States}

FORMER SHAREHOLDER(S)

^{YANG CHEN-CHEN CHARLES 1}

^{KHOO TONY 1}

HOLDING COMPANY

^{LYONDELL ASIA PACIFIC LTD UF26015C %: 100}

SUBSIDIARY(IES)

No Participation In Our Database

PAYMENT HISTORY AND EXPERIENCES

^{Trade Morality : AVERAGE}

^{Liquidity : SUFFICIENT}

^{Payments : REGULAR}

^{Trend : UPWARD}

^{Financial Situation : AVERAGE}

FINANCIAL ELEMENTS

^{All amounts in this report are in: USD}

^{Audit Qualification: UNQUALIFIED (CLEAN) UNQUALIFIED (CLEAN)}

^{Date Account Lodged: 23/07/2007}

^{Balance Sheet Date: 31/12/2006 31/12/2005}

^{Number of weeks: 52 52}

^{Consolidation Code: COMPANY COMPANY}

ASSETS

^{Preliminary Exp 45,719 77,380}

^{Tangible Fixed Assets: 173,540 252,732}

^{Total Fixed Assets: 219,259 330,112}

^{Inventories: 8,152,406 11,110,542}

^{Receivables: 31,745,157 25,002,857}

^{Cash, Banks, Securities: 4,391,691 566,053}

^{Other current assets: 277,412 182,480}

^{Total Current Assets: 44,566,666 36,861,932}

^{TOTAL ASSETS: 44,785,925 37,192,044}

LIABILITIES

^{Equity capital: 60,734 60,734}

^{Profit & lost Account: 8,591,799 6,204,638}

^{Total Equity: 8,652,533 6,265,372}

^{L/T deffered taxes: 4,530}

^{Total L/T Liabilities: 4,530}

^{Trade Creditors: 34,141,805 28,436,484}

^{Prepay. & Def. charges: 1,149,181 1,552,272}

^{Provisions: 839,155 933,386}

^{Other Short term Liab.: 3,251}

^{Total short term Liab.: 36,133,392 30,922,142}

^{TOTAL LIABILITIES: 36,133,392 30,926,672}

PROFIT & LOSS ACCOUNT

^{Net Sales 169,085,979 133,809,426}

^{Purchases,Sces & Other Goods: 160,330,572 124,407,446}

^{Gross Profit: 8,755,407 9,401,980}

^{NET RESULT BEFORE TAX: 2,932,343 3,073,751}

^{Tax : 545,182 698,553}

^{Net income/loss year: 2,387,161 2,375,198}

^{Depreciation: 105,852 73,113}

^{Directors Emoluments: 256,867 238,671}

^{Wages and Salaries: 1,521,388 1,455,218}

^{Financial Income: 103,715 57,290}

RATIOS

^{31/12/2006 31/12/2005}

^{Turnover per employee: 8454298.95 6690471.30}

^{Net result / Turnover(%): 0.01 0.02}

^{Stock / Turnover(%): 0.05 0.08}

^{Net Margin(%): 1.41 1.78}

^{Return on Equity(%): 27.59 37.91}

^{Return on Assets(%): 5.33 6.39}

^{Net Working capital: 8433274.00 5939790.00}

^{Cash Ratio: 0.12 0.02}

^{Quick Ratio: 1.00 0.83}

^{Current ratio: 1.23 1.19}

^{Receivables Turnover: 67.59 67.27}

^{Leverage Ratio: 4.18 4.94}

^{Net Margin : (100*Net income loss year)/Net sales}

^{Return on Equity : (100*Net income loss year)/Total equity}

^{Return on Assets : (100*Net income loss year)/Total fixed assets}

^{Net Working capital : (Total current assets/Total short term liabilities)/1000}

^{Cash Ratio : Cash Bank securities/Total short term liabilities}

^{Quick Ratio : (Cash Bank securities+Receivables)/Total Short term}

^liabilities

^{Current ratio : Total current assets/Total short term liabilities}

^{Inventory Turnover : (360*Inventories)/Net sales}

^{Receivables Turnover : (Receivable*360)/Net sales}

^{Leverage Ratio : Total liabilities/(Total equity-Intangible assets)}

FINANCIAL COMMENTS

^{THE FINANCIAL CONDITION OF THE COMPANY WAS SEEN TO BE FAIR IN VIEW OF}

^{THE FOLLOWING:}

^{NET WORTH:}

^{THE BALANCE SHEET WAS PASSABLE WITH NET WORTH IMPROVED BY 38.10% FROM}

^{US$6,265,372 IN 2005 TO US$8,652,533 IN 2006. THIS WAS DUE TO HIGHER}

^{RETAINED EARNINGS OF US$8,591,799 (2005: US$6,204,638); A RISE OF}

^{38.47% FROM THE PRIOR YEAR.}

^LEVERAGE:

^{IN THE SHORT TERM, SUBJECT WAS LARGELY FINANCED BY TRADE CREDITORS}

^{WHICH MADE UP 94.49% (2005: 91.96%) OF THE TOTAL CURRENT LIABILITIES}

^{AND AMOUNTED TO US$34,141,805 (2005: US$28,436,484). THE BREAKDOWN IS}

^{AS FOLLOWS:}

^{* TRADE PAYABLES - 2006: US$9,609,702}

^{(2005: US$557,854)}

^{* AMOUNTS PAYABLE TO ULTIMATE HOLDING COMPANY - 2006: US$9,269,130}

^{(2005: US$12,409,176)}

^{* AMOUNTS PAYABLE TO RELATED CORPORATIONS - 2006: US$15,262,973}

^{(2005: US$15,469,454)}

^{IN ALL, LEVERAGE RATIO FELL FROM 4.94 TIMES TO 4.18 TIMES DESPITE A}

^{GREATER RISE IN TOTAL LIABILITIES TO TOTAL EQUITY.}

^LIQUIDITY:

^{IN GENERAL, SUBJECT'S LIQUIDITY SITUATION WAS PASSABLE AS SEEN FROM}

^{THE RISE IN NET WORKING CAPITAL AND LIQUIDITY RATIOS. CURRENT RATIO}

^{ROSE TO 1.23 TIMES, UP FROM 1.19 TIMES AND QUICK RATIO IMPROVED FROM}

^{0.83 TIMES TO 1.00 TIMES. SIMILARLY, NET WORKING CAPITAL IMPROVED BY}

^{41.98% FROM US$5,939,790 IN 2005 TO US$8,433,274 IN 2006.}

^{PROFITABILITY:}

^{REVENUE POSTED AN INCREASE OF 26.36% FROM US$133,809,426 IN 2005 TO}

^{US$169,085,979 IN 2006. HOWEVER, THE RISE OF NET PROFIT WAS ONLY A}

^{SLIGHT INCREASE OF 0.50% TO US$2,387,161 (2005: US$2,375,198). THIS}

^{COULD BE DUE TO HIGHER COST OF GOODS SOLD OF US$160,330,572 (2005:}

^{US$124,407,446). HENCE, NET MARGIN FELL FROM 1.78 TIMES IN 2005 TO}

^{1.41 TIMES IN 2006.}

^{DEBT SERVICING:}

^{DEBT SERVICING PROBLEMS MIGHT NOT BE EXPECTED IF REVENUE AND EARNINGS}

^{CAN BE MAINTAINED AND PAYMENT BY TRADE DEBTORS ARE FORTHCOMING.}

^{NON-CURRENT ASSETS:}

^{THE FOLLOWING ITEMS ARE CLASSIFIED UNDER PRELIMINARY:}

^{* DEFERRED EXPENDITURE - 2006: US$25,793 (2005: US$77,380)}

^{* DEFERRED INCOME TAX ASSETS - 2006: US$19,926 (2005: NIL)}

BACKGROUND/OPERATION

^{THE COMPANY WAS INCORPORATED IN THE REPUBLIC OF SINGAPORE ON}

^{26/02/2000 AS A LIMITED PRIVATE COMPANY AND IS TRADING UNDER ITS}

^{PRESENT NAMESTYLE AS "LYONDELL SOUTH ASIA PTE LTD".}

^{THE COMPANY HAS A ISSUED AND PAID-UP CAPITAL OF}

^{100,000 SHARES, OF A VALUE OF S$100,000.}

^{PRINCIPAL ACTIVITIES:}

^{SUBJECT IS REGISTERED WITH THE ACCOUNTING AND CORPORATE REGULATORY}

^{AUTHORITY (ACRA) BE PRINCIPALLY ENGAGED IN THE BUSINESS OF:}

^{1) WHOLEDSALE OF CHEMICALS AND CHEMICALS PRODUCTS;}

^{TRADING OF CHEMICAL PRODUCTS}

^{DURING THE FINANCIAL YEAR UNDER REVIEW, THE PRINCIPAL ACTIVITIES OF}

^{THE COMPANY CONSIST OF THE TRADING AND SUPPLY OF CHEMICALS FOR}

^{INDUSTRIAL USE AND PROVIDING ADMINISTRATIVE SERVICES TO ITS RELATED}

^{CORPORATIONS.}

^{FROM THE RESEARCH DONE, THE FOLLOWING INFORMATION WAS GATHERED:}

^{SUBJECT ENGAGES IN THE FOLLOWING ACTIVITIES:}

^{* MANUFACTURER AND SELLER OF PROPYLENE OXIDE, PROPYLENE GLYCOL,}

^{ETHYLENE, PROPYLENE AND POLYETHYLENE. SUBJECT IMPORTS AND EXPORTS}

^{CHEMICAL PRODUCTS AS WELL AS TRANSPORTING CHEMICAL PRODUCTS TO}

^OVERSEAS.

^{BUSINESS PARTNER:}

^{* SAIPER CHEMICALS PRIVATE LIMITED}

^{FROM THE TELE-INTERVIEW CONDUCTED SUBJECT CONFIRMED ITS}

^{ADDRESS AND CONTACTS. HOWEVER, QUESTIONS REGARDING ITS IMPORT AND}

^{EXPORT COUNTRIES WERE REJECTED. THE FOLLOWING WAS GATHERED:}

^{NUMBER OF EMPLOYEES:}

^{* 20}

^{NO OTHER TRADE INFORMATION IS AVAILABLE}

^{THE COMPANY'S IMMEDIATE HOLDING CORPORATION IS LYONDELL ASIA PACIFIC}

^{LTD, INCORPORATED IN THE UNITED STATES OF AMERICA. THE ULTIMATE}

^{HOLDING CORPORATION IS LYONDELL CHEMICAL COMPANY, WHICH IS ALSO}

^{INCORPORATED IN THE UNITED STATES OF AMERICA.}

^{NUMBER OF EMPLOYEES (31 DECEMBER):}

^{* COMPANY - 2006: NOT AVAILABLE (2005: NOT AVAILABLE; 2004: 13;}

^{2003: 14)}

^{REGISTERED AND BUSINESS ADDRESS:}

^{250 NORTH BRIDGE ROAD}

^#14-03/04

^{RAFFLES CITY TOWER}

^{SINGAPORE 179101}

^{DATE OF CHANGE OF ADDRESS: 09/05/2005}

^{- PROPERTY RECORD WAS NOT AVAILABLE}

^{WEBSITE : http://www.lyondell.com}

^{EMAIL : -}

MANAGEMENT

^{THE DIRECTORS AT THE TIME OF THE REPORT ARE:}

^{1) CHARLES WAYNE GRAHAM, AN AMERICAN}

^{- BASED IN HONG KONG.}

^{2) YANG CHEN-CHEN CHARLES, AN AMERICAN}

^{- BASED IN HONG KONG.}

^{3) KHOO TONY, A SINGAPOREAN}

^{- HOLDS NO OTHER DIRECTORSHIPS AS RECORDED IN OUR DATABASE.}

SINGAPORE’S COUNTRY RATING 2007

^{RATING: A1}

^{INVESTMENT GRADE}

^{IN SINGAPORE, THE POLITICAL SITUATION REMAINS STABLE.}

^{SINGAPORE BOASTS THE BEST GOVERNANCE IN ASIA, WITH AN EFFECTIVE LEGAL SYSTEM FACILITATING DEBT COLLECTION AND TO A HIGH DEGREE OF FINANCIAL TRANSPARENCY.}

^{EXTERNAL ACCOUNTS HAVE REMAINED SUBSTANTIALLY IN SURPLUS, CONTRIBUTED TO THE DYNAMISM OF THE ELECTRONICS AND PHARMACEUTICALS SECTORS AND TO REPATRIATION OF PROFITS FROM SINGAPORE INVESTMENTS. THE FINANCIAL AND TOURISM SECTORS HAVE ALSO CONTRIBUTED TO THE LARGE CURRENT ACCOUNT SURPLUS.}

^{SINGAPORE CONTINUES TO KEENLY WELCOME FOREIGN INVESTMENT AND OFFERS A VERY OPEN AND WELL-PLANNED ECONOMIC AND POLITICAL ENVIRONMENT. IT HAS BEEN IMPLEMENTING AMBITIOUS DIVERSIFICATION STRATEGY, FOCUSED PARTICULARLY ON THE CHEMICALS AND PHARMACEUTICAL SECTORS.}

^{THE GOVERNMENT USES FOREIGN DIRECT INVESTMENT TO DEVELOP PRIORITY SECTORS (ELECTRONICS, CHEMICALS, BIOTECHNOLOGY). THE AIM IS TO ENCOURAGE THE GROWTH OF HIGH ADDED-VALUE ACTIVITIES AND TURN SINGAPORE INTO A REGIONAL HUB FOR FOREIGN INVESTORS INTERESTED IN ASIA.}

^{CERTAIN SECTORS (MEDIA, LEGAL AND FINANCIAL SERVICES) ARE HOWEVER ONLY PARTIALLY OPEN TO FOREIGN INVESTMENT. THESE SECTORS ARE SLOWLY OPENING UP, BUT THE PROGRESS IS SLOW. AFTER HIGH GROWTH IN 2006, BUOYED BY THE DYNAMISM OF BOTH EXPORTS AND HOUSEHOLD CONSUMPTION, A SLOWDOWN IS EXPECTED IN 2007.}

^ASSETS

^{" MAJOR EXPORTER OF CAPITAL IN ASIA, NOTABLY VIA THE STATE-OWNED TEMASEK HOLDING}

^COMPANY.

^{" HIGH QUALITY COMPETITIVENESS IN ASIA}

^{" EXCELLENT BUSINESS CLIMATE}

^{" POLITICAL STABILITY.}

^WEAKNESSES

^{" SKILLED MANPOWER HAS BEEN LACKING IN THE SECTORS TARGETED FOR DEVELOPMENT.}

^{" AN AGEING POPULATION COULD, ULTIMATELY, AFFECT ECONOMIC PERFORMANCE.}

^{" GROWING INEQUALITY AND THE EMERGENCE OF LONG-TERM UNEMPLOYMENT AMONG THE LEAST}

^{SKILLED COULD GENERATE SOCIAL TENSIONS.}

^{" BEING THE WORLD'S MOST OPEN ECONOMY, IT HAS BEEN VULNERABLE TO WORLD ECONOMIC}

^DOWNTURNS

WHOLESALE AND RETAIL TRADE SECTOR

PAST PERFORMANCE

DOMESTIC WHOLESALE TRADE INDEX

THE OVERALL DOMESTIC WHOLESALE TRADE DECLINED BY 7.5% IN Q1 2007. EXCLUDING PETROLEUM, DOMESTIC SALES FELL BY 7.4%. SECTORS OF ELECTRONIC COMPONENTS, SHIP CHANDLERS AND BUNKERING, INDUSTRIAL AND CONSTRUCTION MACHINERY REPORTED DECLINES OF 11.6% TO 23.8%.

HOWEVER, WHOLESALERS OF FOOD, BEVERAGES AND TOBACCO REGISTERED HIGHER TURNOVER OF 5.4%.

FOREIGN WHOLESALE TRADE INDEX

THE OVERALL FOREIGN WHOLESALE TRADE IN QUARTER 1 2007 FELL BY 7.6%. EXCLUDING PETROLEUM, FOREIGN SALES DECLINED BY 8.0%. MOST WHOLESALE SECTORS REPORTED LOWER OVERSEAS RECEIPTS IN QUARTER 1 2007 COMPARED TO THE PREVIOUS QUARTER, EXCEPT HOUSEHOLD EQUIPMENT AND FURNITURE SECTOR. SHIP CHANDLERS & BUNKERING REPORTED THE LARGEST DECLINE OF 18.3% IN QUARTER 1 2007, FOLLOWED BY FOOD BEVERAGES & TOBACCO SECTOR OF 17.7%.

RETAIL TRADE

THE OVERALL RETAIL SALES ROSE MARGINALLY BY 0.7% IN QUARTER 2 2007, COMPARED TO QUARTER 2 2006. EXCLUDING MOTOR VEHICLES, RETAIL SALES ROSE BY 5.1%. SALES OF OPTICAL GOODS & BOOKS, FURNITURE & HOUSEHOLD EQUIPMENT AND SUPERMARKETS ENJOYED STRONG GROWTHS OVER A YEAR AGO. PROVISION & SUNDRY SHOPS, WATCHES AND JEWELLERY, DEPARTMENT STORES AND WEARING APPAREL & FOOTWEAR SECTORS ALSO REPORTED HIGHER SALES OF 4.35 TO 5.9% RESPECTIVELY.

HOWEVER, RETAILERS OF MOTOR VEHICLES, FOOD & BEVERAGES, TELECOMMUNICATIONS APPARATUS & COMPUTERS AND PETROL SERVICES STATIONS REPORTED LOWER SALES.

OUTLOOK

GENERALLY, WHOLESALERS EXPECT TO DO WELL FOR THE NEXT 6 MONTHS, WITH A POSITIVE NET WEIGHTED BALANCE OF 17%. DEALERS OF FOOD & BEVERAGES, TROPICAL PRODUCE, TEXTILES & LEATHER GOODS AND HOUSEHOLD ELECTRICAL APPLIANCE & EQUIPMENT ARE AMONG THOSE WHO ARE OPTIMISTIC.

RETAIL TRADE FIRMS ANTICIPATE BUSINESS TO BE LESS BRISK FOR THE NEXT 6 MONTHS. IN PARTICULAR, DEPARTMENT STORES, SUPERMARKETS AND RETAILERS OF MOTOR VEHICLES EXPECT SLOWER BUSINESS IN THE COMING MONTHS.

EXTRACTED FROM: MINISTRY OF TRADE AND INDUSTRY, SINGAPORE

SINGAPORE DEPARTMENT OF STATISTICS

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended
NR		In view of the lack of information, we have no basis upon which to recommend credit dealings	No Rating

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions