Letter from the Site Leader — Bob Walker

In my career at Dow, the most important thing I have learned is that people, not equipment, are the key to our success. This was never more true than in 2005.

The last few years brought with them significant challenges, but Dow Texas Operations made it through those times with our employees’ leadership, hard work and determination. Each day in 2005, I saw first hand the commitment of our employees’ to improve the quality of life around the world and right here in Brazosport.

In 1996, The Dow Chemical Company made a commitment based on our respect for the environment, our communities and the well-being of our employees to measure the results of what has come to be known as the company’s “2005 Environmental, Health and Safety Goals.”

Ten years later, Dow is proud to report on the progress of those goals. Our commitment is not to stand comfortably on the improvements, but rather continue the momentum that they have created.

In 2005, Dow Texas Operations had an injury and illness rate of 0.34 incidents per every 200,000 work hours — the site’s lowest rate ever. To put that in perspective, about 8,000 people (Dow employees and contractors) work at Dow Texas Operations on an average day. In 1994, the injury and illness rate was 2.74, and 185 people were injured (more people worked at Dow Texas Operations then). The site had 31 injuries in 2005.

Safety continues to be the highest priority in our company and at our site. A great safety performance doesn’t just happen though. It takes hard work and commitment. We’ve made tremendous strides over the last decade in our injury and illness rate, but we can always be better. Through our Drive to Zero program, we’ve asked our employees to take greater ownership of their safety performance. We’re working to reinforce an already strong safety culture with one goal — zero accidents, zero injuries and zero excuses.

The year also had some other outstanding accomplishments like the starting up of our new PMDI plant, the beginning of the modernization of LHC-7, the continuation of our Dow Community Grants Program and the introduction of our Dow Education Grants Program.

The high cost of natural gas continued to have a large impact on Dow Texas Operations. Volatile natural gas prices have hurt the site’s chances of competing for new large manufacturing units dependent on low-cost energy. Dow still believes that a national energy policy could bring the price of natural gas down, which would help our site be more competitive.

In 2006, Dow will commit to new sustainability goals for the next 10 years. We will build on the improvements achieved through the 2005 EH&S Goals and set broad new goals.

It will also be a special year for Dow Texas Operations as the site celebrates its 65^th Anniversary. It’s a year-long celebration for our employees, our retirees and our community.

Bob Walker
Vice President of Dow Texas Operations