November 26, 2007

Sumitomo Chemical to Expand Lithium Ion Secondary Battery Separator Business
Sumitomo Chemical will expand its facilities for production of its lithium ion secondary battery
separator Pervio®, the Company’s core product in the continuing development of its
energy-related business. Sumitomo Chemical completed construction of a facility for production ofits separators in August 2006 and began supplying them to customers. However, in order to meetthe rapidly increasing demand due to favorable evaluations of the separator’s high performance,
the Company has decided to undertake the current expansion of its production facilities.
Lithium ion secondary batteries are used in devices such as mobile phones, laptop computers
and PDAs as these devices become increasingly functional and portable, and also these batteries
are expected to find application as power sources for hybrid automobiles and other industrial uses.
Given these growing uses, demand for lithium ion secondary batteries is expected to increase
considerably going forward. In terms of performance, these batteries are required to operate athigh capacity for long periods of time. In addition, ensuring the safety of batteries is a vital social
requirement that makes the development of technologies for increasing reliability an important
pursuit.
Utilizing its organic synthesis and functional polymer design technologies cultivated over manyyears, Sumitomo Chemical developed proprietary technology for laminating a polyolefin basematerial and aramid heat resistant layer to develop a separator with superior heat resistance, andwas the first to achieve practical application and commercialize a product with this aramid heat
resistant layering technology. Pervio® has received highly favorable evaluations from customers
as a product that improves the reliability of lithium ion batteries.
In order to meet the broad-ranging expectations of our customers, the Company will expand thecapacity of its production facility in stages from the middle of 2008 through the beginning of 2009.
This expansion will incorporate the Sumitomo Chemical’s accumulated expertise as well as thelatest technology to further enhance both functionality and product quality. When completed,production capacity together with existing production lines will be a planned 12 million square
meters annually by the middle of 2008, 16 million square meters annually by the end of 2008, andthe combined capacity of all production lines will reach 25 million square meters annually in 2009.
The Company will also study further production capacity expansions in the future to meet thegrowing demand.
Sumitomo Chemical positions energy as one of the areas where it can contribute to the solutionof environmental problems through its long-cultivated technologies, and it is devoting its efforts toR&D to commercialize new businesses in this field. In addition to its separators, the Companyplans to start a series of new businesses going forward for materials such as cathodes and otherlithium ion battery materials, as well as components for use in fuel cells.
Production Capacity Following Expansions:
1. Facility Capacity:
Mid-2008: 12 million sq. m/yr.
End 2008: 16 million sq. m/yr.
Mid-2009: 25 million sq. m/yr.
2. Production Base:Sumitomo Chemical, Ehime Works, Niihama, Japan