Chemical Technology Joint Venture Announced to Create Increased Customer Value.

WICHITA, Kan.--(BUSINESS WIRE)--Aug. 31, 1998--Three leading chemical technology companies announced today that they intend to form a joint venture company to design, fabricate and supply modular mass transfer systems, engineered components (such as distillation columns and special heat exchangers) and engineering design services.

The joint venture will be named Koch Modular Process Systems, LLC, and will be headquartered in Paramus, New Jersey. The company will be formed by combining Koch Process Technologies, Inc.'s modular distillation business; Modular Process Systems, Inc.'s mass transfer systems business; and Schlowsky Engineers, Inc.'s process engineering and mechanical design business. In addition, the joint venture will be able to draw on the resources of Koch-Glitsch, Inc., for mass transfer products and field installation services. The day-to-day operations of the joint venture will be managed by the current owners of Schlowsky Engineers and Modular Process Systems, George Schlowsky, Alan Erickson and Tom Schafer.

"The primary business goal of this joint venture is to maximize efficiencies and provide valued service to our customers," said Roger Cusack, president of Koch Process Technologies, Inc. "We are convinced that we will be able to more efficiently serve the chemical process industry's future modular distillation and engineering plant needs with a combination of capabilities that will include the design and project management services of these three companies, coupled with the use of Koch-Glitsch's mass transfer products."

"Customers will benefit from the combined resources and expertise of the three companies which truly represents a synergism of talents coupled with a more efficient and wider range of services," said Tom Schafer, president of Modular Process Systems, Inc. "Process development, a full complement of engineering design and construction services, along with startup assistance and customer training, can now all be obtained from a single source."

Vital to the success of the joint venture is its prominent expertise in separations technologies, including fractional distillation, extractive distillation, azeotropic distillation, liquid-liquid extraction, reactive distillation, absorption, stripping and acid gas removal. Customers in the chemical process industry can count on a full range of process design services. These include generation and regression of vapor-liquid and liquid-liquid equilibrium data, process design and computer simulation, pilot plant demonstration, development of PFD's and P&ID's and detailed equipment design drawings. Detailed engineering design services such as mechanical engineering, piping design, pipe stress analysis, structural and civil engineering, electrical and instrumentation design are also available.

Koch Process Technologies, Inc., a subsidiary of Koch-Glitsch, Inc., will contribute its modular distillation and process plants business to the joint venture, but will retain and continue its hydrogen and liquid-liquid extraction businesses. Both companies are subsidiaries of Wichita, Kansas-based Koch Industries, Inc., the second-largest privately held company in North America, with regard to revenue, as ranked by Forbes. Koch Industries and its subsidiaries employ over 16,000 people worldwide. Koch Industries, through those subsidiaries, is involved in virtually all phases of the oil and gas industry, as well as in agriculture, chemicals, chemical technology products, energy services, asphalt products, metals and minerals services, real estate and financial investments. For more information on Koch, refer to Koch's home page at www.kochind.com on the Internet.

Modular Process Systems, Inc., designs and supplies fully preassembled mass transfer systems and specially designed components to its customers in the pharmaceutical, specialty chemical, flavor/fragrance, food, industrial gas and hydrocarbon manufacturing industries. The company has experienced rapid growth since its inception in January of 1994 and is the leading supplier of modular mass transfer systems in the United States. The company's owners will be contributing the entire business to the new joint venture. For more information on Modular Process Systems, refer to their home page at www.modular-process.com.

Schlowsky Engineers, Inc., is a specialty engineering company with expertise in organic chemical process design, separation technologies and resource recovery. Founded in 1979, the firm specializes in process concept evaluation and development, process design and specification, mechanical and other engineering disciplines for its customers in the chemical process industry. The company's owners will also be contributing the entire business to the joint venture.

   CONTACT:  Koch Industries, Inc.
              Michael Wilson, 316/828-3279