Tokyo, May 25, 2006 - Sumitomo Corporation(President and CEO, Motoyuki Oka) has received an order for two blast-furnace-gas (BFG) fired gas turbine combined-cycle (GTCC*) power generation units manufactured by Mitsubishi Heavy Industies, Ltd. for Alchevsk Iron and Steel Works, an affiliate of Industrial Union of Donbass Corp. (IUD) of Ukraine. The new units are scheduled to go on-stream in March and September 2009, respectively. The order marks Sumitomo's first large-size power generation system order received from Ukraine.

The GTCC plant order calls for delivery of two 150 MW (megawatt) units, for a total output of 300 MW. Each unit will consist of a gas turbine, a steam turbine and a generator.

Alchevsk Iron and Steel Works' decision to adopt a GTCC plant came in response to environmental restrictions spreading from Europe, soaring prices of natural gas supplied from Russia, and the need to boost the price competitiveness of its steel products through more efficient energy usage. The exhaust gas from Alchevsk's blast furnaces will be used to meet part of its own electricity needs. In the future, Alchevsk has plans to expand its electricity capacity and sell electricity to the grid.

IUD is a holding company embracing more than 40 companies both within and outside Ukraine. Holdings include enterprises engaged in processing and trading of ferrous metals, production and construction of gas pipelines, distribution of natural gas, engineering for heavy industries, and agricultural development. In addition to the said contract, IUD and Sumitomo have agreed on developing the collaboration in diversified business fields, in particular, energy conservation and construction of more ecological-friendly infrastructure.

Note: With GTCC type power generation, gas and steam turbines are used in combination to generate electricity in two stages. In the first stage the gas turbine generates electricity; and in the second stage steam produced by high-temperature exhausts from the gas turbine drives the steam turbine, again producing electricity. This dual configuration enables GTCC power plants to achieve higher thermal efficiency than non-GTCC plants. Higher efficiency means that GTCC plants require less fuel relative to electricity output and emit less CO2, thus making them more environmentally friendly.