SECURITIES AND EXCHANGE COMMISSION
                           WASHINGTON, D.C. 20549
                    ------------------------------------
                                 FORM 10-K
                    ------------------------------------


[X]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES 
     EXCHANGE ACT OF 1934
                FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997
                                     OR
[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
     EXCHANGE ACT OF 1934
      FOR THE TRANSITION PERIOD FROM __________________ TO __________________

                       COMMISSION FILE NUMBER 1-9988

                             HUNTSMAN POLYMERS
                                CORPORATION
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)

       DELAWARE                                             75-2104131
(State or other jurisdiction of                          (I.R.S. employer
 incorporation or organization)                          identification no.)

       500 HUNTSMAN WAY
      SALT LAKE CITY, UTAH                                    84108
(Address of principal executive offices)                    (Zip code)

     REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (801) 532-5200

SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:

                                            NAME OF EACH EXCHANGE ON WHICH
  TITLE OF EACH CLASS                       THE SECURITIES ARE REGISTERED
 113/4% Senior Notes due 2004                  New York Stock Exchange

SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
                                 None.

            Indicate by a check mark whether the Registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter
period that the Registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days. Yes |X| No ( ) 

            Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein, and will
not be contained, to the best of the Registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of
this Form 10-K or any amendment to this Form 10-K. |X|

            As of March 27, 1998, all of the 1,000 shares of Common Stock
were owned by Huntsman Polymers Holdings Corporation, a wholly-owned
subsidiary of Huntsman Corporation, which is an affiliate of Huntsman
Polymers Corporation.

           APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY
                PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

            Indicate by check mark whether the Registrant has filed all
documents and reports required to be filed by Section 12, 13 or 15(d) of
the Securities Exchange Act of 1934 subsequent to the distribution of
securities under a plan confirmed by a court.
Yes |X|  No (  )

            Indicate the number of shares outstanding of each of the
Registrant's classes of common stock, as of the latest practicable date.

                                              NUMBER OF SHARES OUTSTANDING
         TITLE OF EACH CLASS                    AT MARCH 27, 1998
  Common Stock, $0.01 par value                       1,000

                    DOCUMENTS INCORPORATED BY REFERENCE.
                                   None.




                       HUNTSMAN POLYMERS CORPORATION
                        1997 FORM 10-K ANNUAL REPORT

                             TABLE OF CONTENTS

                                                                         PAGE

PART I      ................................................................3

ITEM 1.  BUSINESS...........................................................3

ITEM 2.  PROPERTIES........................................................12

ITEM 3.  LEGAL PROCEEDINGS.................................................13

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS ..............16

PART II  ..................................................................16

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND
         RELATED STOCKHOLDER MATTERS.......................................16

ITEM 6.  SELECTED FINANCIAL DATA...........................................17

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL 
         CONDITION AND RESULTS OF OPERATIONS...............................18

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.......................25

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
         ON ACCOUNTING AND FINANCIAL DISCLOSURE............................26

PART III ..................................................................26

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT...............26

ITEM 11.  EXECUTIVE COMPENSATION...........................................29

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT...34

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS...................34

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K..35

SIGNATURES  ...............................................................39


                       HUNTSMAN POLYMERS CORPORATION
                      1997 ANNUAL REPORT ON FORM 10-K

                                   PART I

ITEM 1.  BUSINESS

INTRODUCTION

            Huntsman Polymers Corporation represents a combination of three
businesses operated by predecessor entities. In 1958, a subsidiary of The
El Paso Company ("El Paso") constructed a styrene plant in Odessa, Texas.
In 1960, El Paso and a predecessor of Dart Industries Inc. ("Dart") formed
a joint venture to produce ethylene, propylene, polyethylene and
polypropylene in Odessa, Texas. El Paso subsequently acquired the plastic
film business of Dart in 1979 and full ownership of these businesses by
1983. In 1983, El Paso sold its petrochemical, polyolefin and plastic film
business to a management-led group of investors, who consolidated the
businesses under a Delaware corporation named Rexene Corporation ("Old
Rexene"). In 1988, Old Rexene was sold to an investor group organized by an
investment banking firm.

            In October 1991, Old Rexene filed a petition for reorganization
under the federal bankruptcy laws. On September 18, 1992, Old Rexene
emerged from bankruptcy in accordance with a plan of reorganization
providing for the merger of Old Rexene into its wholly-owned operating
subsidiary, Rexene Products Company ("Products"), a Delaware corporation,
which subsequently changed its name to Rexene Corporation (the
"Reorganization").

            On August 27, 1997, Huntsman Centennial Corporation
("Centennial"), a Delaware corporation and a subsidiary of Huntsman
Corporation, a Utah corporation ("Huntsman Corporation"), was merged (the
"Merger") with and into Rexene Corporation ("Rexene"), and Rexene changed
its name to Huntsman Polymers Corporation. Unless otherwise indicated, Old
Rexene, Products, Rexene and Huntsman Polymers Corporation and their
consolidated subsidiaries are sometimes collectively or separately referred
to as "Huntsman Polymers" or the "Company".

            The Merger occurred pursuant to an Agreement and Plan of Merger
among Huntsman Corporation, Centennial and Rexene, dated June 9, 1997 (the
"Merger Agreement"). The stockholders of Rexene approved the Merger
Agreement at a Special Meeting held on August 26, 1997.

            In the Merger, all of the shares of common stock, $.01 par
value, of Rexene (the "Common Stock") (other than dissenting shares and
shares held by Huntsman Corporation, Centennial or Rexene) were canceled
and converted into the right to receive $16.00 in cash, without interest,
per share of Common Stock (the "Merger Consideration"). As a result of the
Merger, Huntsman Corporation indirectly owns all of the Common Stock of the
Company, and the Company thus became an indirect subsidiary of Huntsman
Corporation. Following the Merger, the Company filed a Form 15 with the
Securities and Exchange Commission (the "Commission") regarding the
de-registration of the Common Stock which became effective on November 25,
1997. Effective August 27, 1997, the Common Stock was removed from listing
on the New York Stock Exchange. The aggregate amount of Merger
Consideration was $301,613,836.

            On September 30, 1997, the Company completed the sale of
certain of its assets comprising its CT Film Division (the "CT Film Sale")
to Huntsman Packaging Corporation, a Utah corporation and an affiliate of
the Company ("Huntsman Packaging"), pursuant to that certain First Amended
Asset Purchase Agreement, dated as of September 26, 1997 (the "Asset
Purchase Agreement"), by and between the Company and Huntsman Packaging.
Pursuant to the terms of the Asset Purchase Agreement, the Company
transferred those assets primarily used to conduct or operate the polymer
film manufacturing business known as the CT Film Division (the "CT
Business"), including, among other things, its properties, film
manufacturing facilities, sales offices, warehouses, inventory, technology
and contracts that relate to the CT Business. In consideration for the
transfer of the assets of the CT Business, the Company received $70 million
in cash. The terms of the Asset Purchase Agreement were mutually agreed
upon by the Company and Huntsman Packaging and were based upon arm's-length
negotiations, taking into account various factors concerning the valuation
of the CT Business. The foregoing description of the sale of the assets of
the CT Business does not purport to be complete, and is qualified in its
entirety by reference to the terms of the Asset Purchase Agreement, a copy
of which is attached as Exhibit 10.10 to this Form 10-K.

            The corporate headquarters of the Company are located at 500
Huntsman Way, Salt Lake City, Utah 84108, and its telephone number is (801)
532-5200.

PRINCIPAL PRODUCTS

            Huntsman Polymers manufactures a wide variety of products
ranging from value-added specialty products, such as customized specialty
polymers, to intermediate chemicals, such as styrene. These products are
sold for use in a wide variety of industrial and consumer related
applications. The Company's principal products are polyethylene,
polypropylene, amorphous polyalphaolefin ("APAO") and flexible polyolefin
("FPO") polymers and styrene. In addition, the Company manufactures,
primarily for its own consumption, ethylene and propylene, the two basic
chemical building blocks of the Company's principal products. The Company
manufactures polymers and petrochemicals at its facility in Odessa, Texas
(the "Odessa Facility") which is located near supplies of most of its
feedstocks. The Odessa Facility contains plants which produce polyethylene,
polypropylene, APAO, FPO and styrene, as well as ethylene and propylene
primarily for captive use. The Odessa Facility is located near four
pipelines from which it derives its raw material supply.

            Polyethylene, polypropylene, APAO, FPO and styrene are used in
different industrial processes to manufacture many diverse finished goods.
These principal end market products are set forth below:


[GRAPHIC OMITTED]


            The following chart presents the net sales, excluding sales to
subsidiaries of Huntsman Polymers, contributed by the Company's products
for the years ended December 31:

<TABLE>
<CAPTION>

                                                                             PREDECESSOR COMPANY

                                                                   --------------------------------

                                                                 EIGHT                 
                                                 FOUR MONTHS     MONTHS               YEAR              YEAR
                                                    ENDED        ENDED               ENDED             ENDED
                                                 DECEMBER 31,   AUGUST-31,          DECEMBER 31,     DECEMBER 31
                                                    1997          1997                 1996             1995
                                                ----------------------------------------------------------------
                                                                     (in thousands)

<S>                                                <C>           <C>               <C>             <C>       
Polymers........................................   $   91,519    $  195,298        $  276,820      $  282,658

Styrene.........................................       25,621        56,064            89,647         120,084

Olefins and other...............................       22,535        56,241            68,830          41,971
                                                       ------        ------            ------          ------
Total ..........................................   $  139,675    $  307,603       $   435,297      $  444,713
                                                      =======       =======           =======         =======


</TABLE>

The Company is not dependent upon a single customer, or a few customers,
the loss of any one or more of which would have a material adverse effect
on the Company.


Polymers

            Polyethylene. Polyethylene represents by volume the most widely
produced thermoplastic resin in the world. The majority of polyethylene
produced in the United States is low-density polyethylene ("LDPE") resin.
In 1997, approximately 53% of the LDPE capacity in the United States was
used to make high pressure low-density polyethylene ("HPLDPE") resin and
the balance to make linear low-density polyethylene ("LLDPE") resin. The
Company currently only manufactures HPLDPE, but intends to manufacture
LLDPE commencing in the first quarter of 1999 with the anticipated
completion of construction of an LLDPE plant at the Odessa Facility. See
"Product Development" below.

            The Company produces a variety of grades of HPLDPE. Many of the
resins are designed to meet specific requirements of particular end-uses.
Examples of the Company's differentiated polyethylene resins are
ethylene-vinyl acetate copolymer resins used in film applications that
require high clarity, toughness and sealability, and specialty low-gel
resins used in computer circuit board production.

            There are currently 13 domestic producers of LDPE resins, some
of which produce both HPLDPE and LLDPE. In 1997, these producers had an
estimated combined, rated annual production capacity of approximately 16.3
billion pounds. The largest manufacturer of LDPE is Equistar Chemicals, LP.
In 1997, the other five largest domestic producers of LDPE were Dow
Chemical Company, Union Carbide Corporation, Chevron Chemical Company,
Exxon Chemical Company and Mobil Chemical Company. In 1997, the Company
accounted for approximately 3% of the United States' capacity for LDPE and
approximately 5% of the United States' capacity for HPLDPE.

            Polypropylene. The Company currently produces a wide variety of
polypropylene resin grades. These include high purity homopolymers and
random and impact copolymers with properties specifically tailored for
specialty markets and specific end-uses, such as medical, electrical and
automotive applications. The Company is one of only two domestic producers
of a super clean grade of polypropylene utilized for medical applications,
electrical capacitor film and electronics packaging.

            In 1997, there were 14 domestic producers of polypropylene in
the United States. The industry's estimated combined, rated annual
production capacity was approximately 13.6 billion pounds in 1997. In 1997,
the four largest domestic producers of polypropylene were Montell U.S.A.,
Inc., Amoco Chemicals Corporation, Huntsman Corporation and Exxon Chemical
Company. Competition for sales is dependent upon a variety of factors,
including product price, technical support and customer service, and the
degree of specialization of various grades of polypropylene. General
purpose polypropylene ordinarily competes principally on the basis of
price, while more differentiated polypropylene competes principally on the
basis of product quality, performance specifications and, to a lesser
extent, price. In 1997, the Company accounted for approximately 1.5% of the
United States, production capacity for polypropylene.

            APAO. The Company is one of only two U.S. on-purpose producers
of APAO. APAO is a special purpose, high quality polymer used primarily in
the production of adhesives and sealants, modified bitumen roofing
materials, lamination, wire and cable coating. These applications include
hot melt adhesives for nonwovens, packaging, pressure sensitive and
assembly applications and as a modifier of other polymers. The Company is
the only domestic producer of butane copolymer APAO, a high value product
used in hot melt adhesive applications.

            The Company and Eastman Chemical Company are currently the only
domestic on-purpose producers of APAO. In addition, a few producers of
polypropylene also produce atactic polypropylene ("APP"), which competes
with APAO for some less performance driven uses. Based on management
estimates, in 1997, the Company accounted for approximately 36% of the
United States, combined capacity for APAO and APP.

            FPO. FPO is a homogenous, polypropylene resin, produced in a
process that controls the crystallinity of the various grades. The Company
has designed FPO for specific product applications, such as medical bags,
containers, tubing, non-woven personal care products, automotive interior
uses, industrial sheeting, film and insulation.

            FPO competes with a variety of specialized or engineering
grades of polymers, including flexible polyvinyl chloride ("PVC"),
polyurethane and various polyolefins. FPO competes with these and other
polymers on the basis of product performance, specification and price.
Manufacturing and marketing issues may result in slower than expected
development of this polymer.

Styrene

            Styrene is an intermediate commodity petrochemical made from
ethylene and benzene and used principally in the production of polystyrene,
acrylonitrile-butadiene-styrene resins, styrene-butadiene latex and rubbers
and unsaturated polyester resins. Through these products, styrene can be
found in packaging and consumer products, including disposable cups and
trays, consumer electronics, automotive trim, tires and building materials
such as carpeting and insulation.

            In 1995, 1996 and 1997, the Company entered into several
long-term styrene contracts, which it believes will reduce its exposure to
future price volatility. Export sales, on a contractual and spot basis, are
handled directly and through international trading companies.

            In 1997, there were 10 domestic producers of styrene with an
estimated combined, rated annual production capacity of approximately 12.3
billion pounds. More than 50% of this capacity is consumed internally by
the styrene producers for the production of derivatives such as
polystyrene. In 1997, the five largest domestic producers of styrene were
Arco Chemical Company, Sterling Chemicals, Inc., Chevron Chemical Company,
Dow Chemical Company and Huntsman Corporation. Competition for sales is
generally based on price. In 1997, the Company accounted for approximately
2.6% of United States production of styrene.

Olefins and other

            The Company manufactures olefins from ethane and propane which
are fractionated from natural gas liquids ("NGLs"). The Odessa Facility
obtains a combination of pure and mixed NGLs from NGLs extraction plants
located in West Texas. Ethane and propane prices are established in Mont
Belvieu, Texas according to prevailing market conditions. The Company,
however, is able to purchase NGLs containing ethane and propane in West
Texas at prices discounted from prevailing reported average Mont Belvieu
prices. These discounts reflect a significant portion of the cost for the
producers to transport NGLs to Mont Belvieu, Texas and to fractionate them
into pure ethane and propane. The Company believes feedstock supplies
available in Odessa are currently adequate for the Company's requirements.
The Company has storage capacity for an approximate fifteen-day supply of
feedstocks.

            The Company currently consumes substantially all of its
ethylene production internally. The Company selectively sells approximately
30 million pounds of liquid ethylene to customers not located on the Gulf
Coast pipeline grid. The Company has undertaken a major expansion that is
intended to increase its ethylene production from approximately 600 million
to 820 million pounds per year. In December 1995, the Company announced a
capital project for the modernization and expansion of the olefins plant.
The proposed modernization and expansion, scheduled for completion in the
first quarter of 1999, will include a debottlenecking of the Company's
ethylene production process.

Plastic Film

            Prior to the sale of the CT Business, the Company, through the
CT Business, was a major participant in specialty markets for plastic
films. Product applications for these films include disposable diapers,
feminine hygiene products, medical device packaging, tapes, maskants,
industrial packaging, laminations, unsupported overwraps, and greenhouse
and agricultural applications.

EXPORT SALES

            The following chart summarizes revenues from export sales, and
the percentages of net sales represented by export sales, for the indicated
years ended December 31:

<TABLE>
<CAPTION>

                                                                         1997            1996*           1995*
                                                                       ------           ------          --------
                                                                                   (in thousands)

Export sales:
<S>                                                                     <C>          <C>              <C>      
     Continuing Operations...........................................   $  29,295    $  28,743        $  24,046

     Discontinued Operations.........................................       9,486       25,395           53,462

Percentage of net sales (including discontinued operations):

     Continuing Operations...........................................          5%           5%               4%

     Discontinued Operations.........................................          2%           4%               9%

</TABLE>

----------------

*     Export sales totaled $54,138 and $77,508 in 1996 and 1995,
      respectively. The Company has determined the allocation between
      continuing and discontinued export sales as indicated above.


            The majority of the Company's export sales were to foreign
companies through agents and international trading companies.

PRODUCT DEVELOPMENT

            The Company continually seeks to enhance and expand its
portfolio of specialty polymers through sustained in-house research and
development and licensing arrangements. For example, in late 1995, the
Company licensed LLDPE and high density polyethylene technology from
Stamicarbon B.V., a licensing subsidiary of DSM. When planned production
commences in the fourth quarter of 1998, the Company's LLDPE plant in
Odessa, Texas will be the first North American production facility to make
LLDPE using the DSM "Compact(R)" process. This process refers to the
plant's small physical size, which is well suited to efficiently produce a
broad range of high quality products. The octane copolymers produced by
this process are consistent with the Company's strategy of producing higher
quality, value-added products.

            The Company has spent between $5.8 million and $6.2 million per
year for research and development during each of the last three fiscal
years and anticipates spending approximately $9.2 million for research and
development in 1998.

RAW MATERIALS FOR PRINCIPAL PRODUCTS

            Principal raw materials purchased by the Company consist of
ethane and propane extracted from NGLs, propylene and benzene (all four of
which are referred to as "feedstocks") for the polymer and styrene
businesses. The prices of feedstocks fluctuate based upon the prices of
natural gas and oil, weather conditions affecting the demand for natural
gas and other factors. During 1997, feedstocks accounted for approximately
28% of the Company's total cost of sales. As a result, increases and
decreases in raw material costs have a significant impact on operating
results. After increasing significantly during the fourth quarter of 1996,
feedstock prices decreased midway through the first quarter of 1997 and
remained fairly stable throughout the balance of 1997 due to higher
inventory levels and a fairly mild winter season.

            The principal feedstocks for the Company's captive ethylene and
propylene production at the Odessa Facility are ethane and propane. Ethane
and propane prices are established in Mont Belvieu, Texas (Gulf Coast)
according to prevailing market conditions, but the Company is able to
purchase NGLs containing ethane and propane in west Texas at prices
discounted from the prevailing reported average Mont Belvieu, Texas prices.
These discounts reflect a significant portion of the cost for the producers
to transport NGLs containing ethane and propane to Mont Belvieu, Texas and
to fractionate them into pure ethane and propane. In 1997, the Company
acquired all of the Odessa Facility's requirements for ethane and propane
under such arrangements.

            The Odessa Facility obtains a combination of pure and mixed
streams of NGLs from NGL pipelines and NGL extraction plants located in
west Texas and uses such streams to obtain ethane and propane feedstocks
for the Company's olefins plant. In 1997, the Odessa Facility consumed
approximately 684 million and 347 million pounds of ethane and propane,
respectively, and in 1996, the Odessa Facility consumed ethane and propane
of approximately 569 million and 498 million pounds, respectively. In 1997,
the Company produced all of its ethylene and 50% of its propylene
requirements for the Odessa Facility. The Company's other propylene
requirements were purchased from third parties. The feedstock supplies
available in Odessa are currently adequate for the Company's requirements.
The Company has storage capacity for an approximately fifteen-day supply of
feedstocks.

            The Odessa Facility uses benzene and ethylene to produce
styrene. In 1997, substantially all of the Company's benzene purchases were
under contracts from Gulf Coast and west Texas producers at prevailing
contract prices, with the balance of its needs filled by purchases on the
spot market.

EMPLOYEES AND LABOR RELATIONS

            As of December 31, 1997, the Company employed approximately 770
persons.

TRADEMARKS AND PATENTS

            The Company is the owner of many United States and foreign
patents and uses trade secrets, including substantial know-how, which
relate to its polyethylene, polypropylene, APAO and FPO products. Although
patents and trade secrets are important to the Company, permitting it to
retain ownership and use of its technological advances, the Company does
not believe that the loss of any patent would have a material adverse
effect on its financial condition. The Company also uses the technology of
others under license agreements in certain of its manufacturing operations.
Various trademarks owned by the Company or its affiliates are used in
connection with the sale of the Company's products. The Company does not
believe that the loss of the right to use any trademarks owned by the
Company or its affiliates would have a material adverse effect on its
financial condition.

ENVIRONMENTAL AND RELATED REGULATION

General

            The Company and the industry in which it competes are subject
to extensive environmental laws and regulations and are also subject to
other federal, state and local laws and regulations regarding health and
safety matters. In addition, future developments, such as increasingly
strict requirements and enforcement policies thereunder could bring into
question the handling, manufacture, storage, use, emission or disposal of
substances at the Company's facilities. The ongoing operations of chemical
manufacturing plants entail risks in these areas and there can be no
assurance that material costs or liabilities will not be incurred in the
future. Changes to or reinterpretations of existing laws could materially
and adversely affect the Company's business and results of operations. The
Company has received notices of alleged violations of certain environmental
laws and has endeavored to remedy such alleged violations promptly. The
Company believes that its business operations and facilities generally have
been, and are being operated in compliance in all material respects with
applicable environmental and health and safety laws and regulations.

            The Company's operating expenditures for environmental
remediation, compliance and waste disposal were approximately $7.1 million
and $7.6 million in 1997 and 1996, respectively. The Company also spent
approximately $7.7 million and $1.4 million relating to capital
expenditures for environmentally related projects in 1997 and 1996,
respectively. In 1998, the Company anticipates spending approximately $9.1
million for environmental remediation, compliance and waste disposal. Of
such amount, expenditures relating to remediation are projected to be
approximately $1.5 million for 1998. Environmental capital spending is
estimated at $1.7 million for 1998. Capital expenditures increased
substantially in 1997 due to the construction and initial startup of the
new wastewater treatment facility. Approximately $6.6 million was spent in
1997 to refurbish a municipal wastewater reclamation plant to be used as
the primary means of disposal for the Company's wastewater. Outside of the
environmental components associated with the LLDPE and olefins plant
expansion projects, the Company expects to incur between $2 million and $4
million annually in capital spending to address the requirements of
environmental laws.

            The Company believes that, in light of its historical
expenditures and expected future results of operations, it will have
adequate resources to conduct its operations in compliance with currently
applicable environmental, health and safety laws and regulations. However,
in order to comply with changing facility permitting and regulatory
standards, the Company may be required to make additional significant site
or operational modifications that are not currently contemplated. Further,
the Company has incurred and may in the future incur liability to
investigate and clean up waste or contamination at its current or former
facilities, or which it may have disposed of at facilities operated by
third parties. The Company has approximately $8.5 million accrued in the
December 31, 1997 balance sheet as an estimate of its total potential
environmental liability with respect to investigating and remediating known
and assessed site contamination.

            The Company continually reviews its estimates of potential
environmental liabilities. However, no assurance can be given that all
potential liabilities arising out of the Company's present or past
operations have been identified or fully assessed or that the amount that
might be required to investigate and remediate such conditions will not be
significant to the Company.

            The Company carries Pollution Legal Liability insurance to
address some of the potential environmental liabilities, subject to the
policy terms, limits, exclusions and deductibles, on both a Sudden and
Accidental basis and on a Gradual basis for occurrences first commencing
after July 1, 1997.

            The Company also carries Pollution Legal Liability and Closure
and Post Closure insurance on certain facilities at the Odessa
manufacturing location, which are regulated by the Texas Natural Resources
Conservation Commission (the "TNRCC"). This insurance satisfies the
requirements of the TNRCC governing the operation of these facilities.

Wastewater

            The Company historically disposed of its wastewater from the
Odessa Facility through injection wells operated under permits from the
TNRCC. Due to concerns by the agency regarding the operation of these
underground injection wells, and their intention to not renew the permits
after they expired in December 1997, the Company entered into an agreement
with the City of Odessa and the Gulf Coast Waste Disposal Authority
pursuant to which the latter is currently disposing of the wastewater
through the refurbished Odessa South Wastewater Treatment Facility, a
publicly-owned-treatment-works ("POTW"). The cost of refurbishing the
City's wastewater treatment facility, which was approximately $8.0 million,
has been financed principally by the Company. This facility was brought
on-line in October and November of 1997 and culminates three years of
working together to provide a long range, cost effective wastewater
disposal solution. Wastewater is pumped to this facility where it is mixed
with City effluent as well as other industrial discharges. The water is
treated to meet discharge standards before it is released to an
intermittent-flowing stream for further reuse.

Solid Wastes

            In March 1994, the TNRCC granted the Company a permit to
operate three hazardous waste management units at the Odessa Facility as
treatment/storage/disposal facilities under the Resource Conservation and
Recovery Act. This permit is accompanied by a compliance plan requiring the
Company to undertake certain activities relating to corrective action of
existing contamination at the Odessa Facility. Pursuant to this compliance
plan, the Company has installed groundwater recovery systems, investigated
the extent of on-site contamination, conducted a soils risk assessment to
determine the level of risk it presents to human health and the
environment, developed a corrective measures study on the ways to remediate
the contamination, and started implementation of a remediation plan
approved by the TNRCC.

            Extensive environmental investigation of the groundwater, soils
and solid waste management has been conducted at the Odessa Facility. Risk
assessments have been completed for a number of these facilities and
corrective measures have been defined and conducted. Approval by the TNRCC
for closure of five solid waste management units was received in the first
quarter of 1997. This risk based closure enabled a reduction in the accrual
for potential environmental liability of approximately $9.0 million. A
program for the remediation of existing contamination both at the Odessa
Facility and at third-party sites is continuing.

Air Emissions

            In 1990, Congress amended the federal Clean Air Act to require
control of certain emissions not previously regulated, some of which are
emitted by the Company's facilities. This legislation will require the
Company (and others in the industry with such emissions) to implement
additional pollution control measures. Some of the regulations detailing
these additional control measures have not yet been promulgated. The
Company expects that modifications required by the currently published
regulations can be accomplished within the projected capital budget, but it
can give no assurance that the costs it may incur to comply with
regulations that have not yet been issued will not be significant.

            The Company operates in accordance with air permitting
regulations in the states where its facilities are located. Most plant
operations are governed by existing air permits. There are, however, two
plants at the Odessa Facility that are exempt from permit requirements.
Permitting of these facilities is being conducted currently in preparation
for upcoming federal air requirements associated with Title V permits.

Additional Environmental Issues

            The federal Comprehensive Environmental Response Compensation
and Liability Act ("CERCLA"), as amended, and similar laws in many states,
impose liability for the clean-up of certain waste sites and for related
natural resource damages, without regard to fault or the legality of the
waste disposal. Liable persons generally include the site owner or
operator, former site owners and persons that disposed or arranged for the
disposal of hazardous substances found at those sites. The Company has sent
wastes from its operations to various third-party waste disposal sites.
Additionally, the Company has developed estimates for clean-up of known
waste sites and included these potential liabilities in the environmental
accrual account. From time to time the Company receives notices from
representatives of governmental agencies and private parties contending
that the Company is potentially liable for a portion of the investigation
and remediation at such third-party and currently and formerly-owned sites.
Although there can be no assurance, the Company does not believe that its
liabilities for investigation and remediation of such sites, either
individually or in the aggregate, will have a material adverse effect on
the Company.

ITEM 2.  PROPERTIES

            The Company manufactures its polymers and petrochemicals at the
Odessa Facility. The Odessa Facility is located on an approximately
875-acre site in west Texas which contains plants producing polyethylene,
polypropylene, APAO, FPO and styrene, as well as ethylene and propylene
primarily for captive use. The Odessa Facility is located near four NGL
pipelines from which it derives its supply.

            The polyethylene plant in Odessa, Texas has been in operation
since 1961 and has a total rated annual production capacity of
approximately 430 million pounds. In December 1995, the Company announced
its plan to build a new LLDPE plant at the Odessa Facility. The plant,
which is scheduled for completion in the first quarter of 1999, is expected
to have a total rated annual production capacity of approximately 220
million pounds.

            The polypropylene plant in Odessa, Texas has been in operation
since 1964 and, in 1997 has a total rated annual production capacity of
approximately 200 million pounds. APAO is produced in a former
polypropylene plant that was converted in 1986 and has a total rated annual
production capacity of approximately 65 million pounds.

            The FPO plant in Odessa, Texas commenced commercial production
in December 1996 and by mid 1997 had a total rated annual production
capacity of approximately 50 million pounds.

            The styrene plant in Odessa, Texas has been in operation since
1958 and has a total rated annual production capacity of approximately 320
million pounds.

            The olefins plant in Odessa has been in operation since 1961
and has a total rated annual production capacity for ethylene of
approximately 600 million pounds and for propylene of approximately 240
million pounds. In December 1995, the Company announced plans to expand and
modernize the olefins plant. The proposed modernization and expansion,
scheduled for completion in the first quarter 1999, will include a
debottlenecking of the Company's ethylene production process, which is
anticipated to increase ethylene capacity to approximately 820 million
pounds.

            During 1997, the polymer and styrene plants in Odessa, Texas
(except the polypropylene and FPO plants) operated at rates in excess of
97% of their total rated annual production capacity. Although several of
these plants first began production more than thirty years ago, the Company
believes these plants are in good operating condition.

ITEM 3.  LEGAL PROCEEDINGS

Shareholder Litigation

            On July 23, 1996, the Company was served with a purported
stockholder class action lawsuit filed in the Chancery Court of the State
of Delaware, in and for New Castle County, arising from the Company's
rejection of the unsolicited offer from Huntsman Corporation to purchase
the outstanding shares of Common Stock. The lawsuit names the Company and
each of its directors as defendants. The complaint alleged that the
defendant directors breached their fiduciary duty to stockholders by
refusing to attempt in good faith to maximize stockholder value in the sale
of the Company and engaging in a plan to thwart and reject offers from
third parties, including Huntsman Corporation, in order to entrench
management. Plaintiff sought certification of the lawsuit as a class
action, an order requiring defendants to take various actions including
exposing the Company to the market place in an effort to create an auction
of the Company and an unspecified amount of damages. The Company is also
aware of two other similar lawsuits that are pending in the Chancery Court.
Plaintiffs' counsel in these cases has agreed to an indefinite extension of
defendants' answer date. Under the agreement, defendants do not need to
respond to the complaints until notified to do so by plaintiffs' counsel.
Huntsman Corporation acquired the Common Stock at a price $2.00 per share
in excess of that referred to in the complaint. Accordingly, the Company
believes it likely that this lawsuit will be dismissed.

Phillips Block Copolymer Litigation

            In March 1984, Phillips Petroleum Company ("Phillips") filed a
lawsuit against the Company seeking injunctive relief, an unspecified
amount of compensatory damages and treble damages. The complaint alleged
that the Company was infringing two Phillips patents titled "Preparation of
Block Copolymers," the last of which expired in 1994. This action, which
was originally filed in Illinois, was transferred to the United States
District Court for the Southern District of Texas, Houston Division. After
discovery proceedings were completed, the Company filed a motion for
summary judgment. Phillips filed a motion for partial summary judgment.
Pursuant to an agreement among the parties, the court appointed a special
master who conducted a hearing on these motions and thereafter recommended
to the court that the Company's motion be granted and Phillips' motion be
denied. Thereafter, Phillips filed motions to disqualify the special
master, to reject the recommendation of the special master and to enter
partial summary judgment for Phillips. In 1993, the court entered an order
denying Phillips' motion to disqualify the special master. In the Company's
bankruptcy proceeding in 1992, Phillips filed a proof of claim seeking in
excess of $108 million based upon the allegations in this litigation. The
Company objected to the claim and elected to leave the legal, equitable and
contractual rights of Phillips unaltered, thereby allowing this litigation
to proceed without regard to the bankruptcy proceeding. On December 23,
1996, the court entered a final judgment in favor of the Company after
granting the Company's motion for summary judgment. Phillips appealed the
judgment. The appeal was argued before the Court of Appeals for the Federal
Circuit on November 5, 1997. No decision has been issued.

Phillips Crystalline License Litigation

            In May 1990, Phillips filed a lawsuit (the "Action") against
the Company in the United States District Court for the District of
Delaware (the "Trial Court") seeking injunctive relief, an unspecified
amount of compensatory damages, treble damages and attorneys' fees, costs
and expenses. The complaint alleged that the Company was infringing
Phillips' U.S. Patent No. 4,376,851 (the "'851 Patent") by virtue of its
continued manufacture of crystalline polypropylene after Phillips
purportedly terminated its license agreement (the "Original License
Agreement") with the Company on April 23, 1990. At trial in October 1994,
the Company asserted several defenses and, in June 1995, the Trial Court
ruled in favor of the Company and Phillips appealed. In March 1996, the
Court of Appeals for the Federal Circuit entered an order reversing the
Trial Court's decision and remanding the Action to the Trial Court. The
Trial Court reviewed and ruled on the Company's other defenses and on
September 4, 1997, the Trial Court entered a judgment in favor of Phillips
finding that the Company had infringed the '851 Patent for the period from
April 24, 1990 to September 4, 1997.

            On September 19, 1997, the Company and Phillips entered into a
settlement agreement (the "Settlement Agreement"), pursuant to which the
Company paid a lump sum of $10 million to Phillips on September 26, 1997,
and will pay up to $300,000 for each subsequent calendar quarter period.
Such quarterly payments begin with the quarter ending December 31, 1997,
and must be paid through the partial quarter ending March 15, 2000, when
the '851 Patent expires. Pursuant to the Settlement Agreement, the Company
and Phillips released and discharged each other from all claims, debts,
demands, liabilities, losses, causes of action, damages, costs and expenses
relating to the subject matter of the Action. In the event the Company
fails to make a timely payment to Phillips when such payment is due
pursuant to the Settlement Agreement, the Company will be obligated to pay
Phillips accrued interest on such payment.

            Effective September 5, 1997, Phillips and the Company entered
into a new crystalline polypropylene license agreement (the "New License
Agreement"). Pursuant to the New License Agreement, Phillips granted to the
Company a nonexclusive, royalty-bearing license to manufacture, use and/or
sell any product which is covered by the '851 Patent. The term of the New
License Agreement is for the period from September 5, 1997, until the
expiration of the '851 Patent on March 15, 2000, unless otherwise
terminated under the provisions thereof. The royalty rate under the New
License Agreement is substantially higher than the royalty rate under the
Original License Agreement. In the event the Company fails to make a timely
payment to Phillips when such payment is due pursuant to the New License
Agreement, the Company will be required to pay Phillips accrued interest on
such payment.

Odessa Residents' Tort Litigation

            On April 15, 1994, the national and state chapters of the
National Association for the Advancement of Colored People ("NAACP") and
approximately 770 residents of a neighborhood approximately one mile
northwest of the Shell Oil Company ("Shell"), the Company and Dynagen, Inc.
("Dynagen") plants in Odessa, Texas petitioned the State District Court in
Odessa, Texas to intervene in a previously existing lawsuit against Dynagen
to (a) add as additional defendants the Company, Shell and General Tire
Corporation (the parent company of Dynagen) and (b) have the litigation
certified as a class action. The plaintiffs' petition seeks an unspecified
amount of money damages for past, present and future injuries to
plaintiffs' health, wrongful death, loss of consortium and reduction in
property values; the conduct of and payment for property clean up,
remediation and relocation costs; payment of expenses for medical testing
and monitoring; funding of pollution and health studies; attorneys' fees;
punitive damages and injunctive relief. Plaintiffs' petition specifies
alleged pollution from air emissions from the three plants as a basis for
their claims. The trial court allowed the intervention and severed the
action from the original lawsuit against Dynagen. Plaintiffs have withdrawn
their motion to have the litigation certified as a class claim. In November
1994, the plaintiffs filed an amended petition which substituted the Odessa
branch of the NAACP as plaintiff in place of the national and state
chapters of the NAACP. The amended complaint also added approximately 100
additional plaintiffs. In May 1996, the trial court announced that the
lawsuit would be tried by groups of plaintiffs and set the first group of
65 plaintiffs for trial in May 1997. The trial court allowed plaintiffs'
counsel to designate ten plaintiffs for the first trial, and the trial
court selected the remaining 55 at random. Discovery was ongoing when in
late January 1997 the parties and the trial court agreed to a 30-day
moratorium to determine if this case could be settled and the May 1997
trial date was vacated. At mediation, the Company agreed to a settlement of
this case and a related case filed in Houston, Texas in late 1996 on behalf
of 7 similarly situated plaintiffs. The trial court approved the settlement
on March 17, 1997. Although the terms of the settlement are confidential,
the settlement did not have a material adverse effect on the Company's
financial position, results of operations or cash flows. Several plaintiffs
unrepresented by counsel were not included in the settlement. All
plaintiffs in the Houston case settled and that lawsuit was dismissed. The
trial court in this case dismissed the claims of certain of those
plaintiffs on motion from the defendants. One of these plaintiffs has filed
a motion for new trial, which was granted. Approximately 20 plaintiffs
remain after these matters were finalized. On March 16, 1998, the trial
court in the case severed their case from the plaintiffs who settled or
whose claims were dismissed. The NAACP lawsuit is being dismissed.

            Although there can be no assurance of the final resolution of
any of these matters, the Company believes that, based upon its current
knowledge of the facts of each case, it has meritorious defenses to the
various claims made and intends to defend each suit vigorously, and the
Company does not believe that the outcome of any of these lawsuits will
have a material adverse effect on the Company's financial position, results
of operations or cash flows.

-------------------------

            With respect to certain pending or threatened proceedings
involving the discharge of materials into or protection of the environment,
see "Item 1 -- Business -- Environmental and Related Regulation". The
Company is also a party to various lawsuits arising in the ordinary course
of business and does not believe that the outcome of any of these lawsuits
will have a material adverse effect on the Company's financial position,
results of operations or cash flows.


ITEM 4.     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

            No matter was submitted to a vote of the Company's security
holders during the fourth quarter of 1997.

                                  PART II

ITEM 5.     MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED 
            STOCKHOLDER MATTERS

Market Information

            Until August 27, 1997, the Company's common stock traded on the
New York Stock Exchange under the symbol "RXN." The following table sets
forth the high and low sales prices of the common stock as reported by the
New York Stock Exchange for the last two fiscal years until August 27,
1997. Since August 27, 1997, all of the Company's stock has been held by
Huntsman Polymers Holdings Corporation ("HPHC"), a subsidiary of Huntsman
Corporation, and there has been no trading of the Company's common stock.

                                                           High          Low

1996:

            First Quarter................................ $ 14 1/4    $  9 1/8
            Second Quarter...............................   13 7/8       9 7/8
            Third Quarter................................   13 7/8       9
            Fourth Quarter...............................   14 1/2      11 3/4


1997:

            First Quarter................................ $ 14 1/2    $ 13
            Second Quarter...............................   15 3/8      12 7/8
            Third Quarter (through August 27, 1997)......   16          14 7/8

Holders

            As of March 27, 1998, there was one holder of record of the
common stock of the Company, Huntsman Polymers Holdings Corporation, a
wholly-owned subsidiary of Huntsman Corporation.

Dividends

            Commencing in December 1995, the Board of Directors declared a
$0.04 per share dividend for each fiscal quarter through the second quarter
of 1997. Since the Merger, no dividends have been declared or paid.
Although the Company has not established a formal policy with respect to
the declaration of dividends, the Company will evaluate the advisability of
declaring future dividends on a quarterly basis based on a number of
factors, including the Company's financial condition and results of
operations. See "Item 7 -- Management's Discussion and Analysis of
Financial Condition and Results of Operations -- Liquidity and Capital
Resources".

ITEM 6.           SELECTED FINANCIAL DATA

            The following table sets forth selected financial data for the
Company as of the dates and for the periods indicated. Information should
be read in conjunction with the Company's Consolidated Financial Statements
and Notes thereto included on the pages immediately following the Index to
Consolidated Financial Statements appearing on page F-1. See "Item 7 -
Management's Discussion and Analysis of Financial Condition and Results of
Operations". In the Merger, effective August 27, 1997, Centennial, a
wholly-owned indirect subsidiary of Huntsman Corporation, merged with and
into Rexene to form the Company. The Merger has been accounted for using
the purchase method of accounting, and Centennial's cost of merging with
the Company was allocated to the assets and liabilities of the Company
based on estimated fair values of such assets and liabilities. In a
transaction effective September 30, 1997, the Company sold the CT Business
to an affiliate of the Company. The consolidated financial statements for
periods prior to September 1, 1997 have been prepared on a historical cost
basis, adjusted for discontinued operations. As a result of the Merger, the
Company's financial position and operating results for the four months
ended December 31, 1997 reflect a new basis of accounting and are not
comparable to prior periods.

<TABLE>
<CAPTION>

                                                                                         PREDECESSOR COMPANY
                                                                                  ---------------------------------
                                                      FOUR MONTHS
                                                          ENDED      EIGHT MONTHS    YEARS ENDED DECEMBER 31,
                                                       DECEMBER 31,   AUGUST 31,     --------------------------
                                                           1997          1997       1996      1995      1994          1993
                                                           ----          ----       ----      ----      ----          ----
                                                                                    (in thousands)

CONSOLIDATED STATEMENTS OF OPERATIONS DATA
ADJUSTED FOR DISCONTINUED OPERATIONS:

<S>                                                      <C>           <C>        <C>        <C>         <C>         <C>     
  Net sales............................................. $139,675      $307,603   $435,297   $444,713    $368,903    $281,885
  Operating income......................................    3,462        42,640     63,255    120,651      57,893       1,156
  Income (loss) from continuing operations..............  (4,483)         3,155     30,444     63,466      10,535    (34,186)
  Income (loss) from discontinued operations, net.......    (218)       (2,692)      (713)      1,977      10,969       8,943
  Income (loss) before extraordinary loss...............  (4,701)           463     29,731     65,443      21,504    (25,243)
  Extraordinary loss, net of income taxes...............        -         (694)          -          -    (25,831)           -
                                                        ---------    ----------  ---------   --------  ----------  ----------
  Net income (loss)..................................... $(4,701)        $(231)    $29,731    $65,443   $ (4,327)   $(25,243)
                                                        =========    ==========  =========   ========  ==========  ==========

</TABLE>


<TABLE>
<CAPTION>

                                                                                          PREDECCESSOR COMPANY
                                                                                            As of December 31,
                                                                                 ---------------------------------
                                                      AS OF         AS OF
                                                  DECEMBER 31,   AUGUST 31,
                                                      1997           1997       1996       1995         1994         1993
                                                      ----           ----      -----      -----        -----        -----
                                                                                  (in thousands)
CONSOLIDATED BALANCE SHEET DATA
ADJUSTED FOR DISCONTINUED

  OPERATIONS:

<S>                                                <C>            <C>        <C>        <C>          <C>          <C>       
    Working capital............................... $  103,261     $ 61,188   $ 162,458  $  108,416   $  140,039   $  109,381
    Total assets..................................    943,123      541,067     567,530     520,591      506,954      434,307
    Long-term debt and other non-current..........

      liabilities.................................    694,241      428,927     334,386     296,080      366,766      397,091
    Stockholders' equity (deficit)................    168,799      166,260     169,051     140,151       74,876      (5,137)
                                                      =======      =======     =======     =======       ======      =======

</TABLE>


ITEM 7.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
            RESULTS OF OPERATIONS

OVERVIEW

            Through September 30, 1997, Huntsman Polymers Corporation,
formerly Rexene Corporation, conducted its business through two operating
divisions: the Rexene Products division, which manufactured polyethylene,
polypropylene, APAO, FPO, styrene, and olefins and the CT Film division,
which manufactured plastic film. On September 30, 1997, the Company sold
the CT Business to Huntsman Packaging Corporation, an affiliate of the
Company. The Company now consists solely of those assets which formerly
comprised Rexene Products division. Consequently, management believes that
a description of the CT Business' results and financial condition of the CT
Business is not meaningful to an evaluation of the Company's results of
operations or financial condition.

            The markets in which the Company competes are generally
cyclical markets that are sensitive to relative changes in supply and
demand as well as general economic conditions. Historically, these products
have experienced alternating periods of tight supply, rising prices and
increased profits followed by periods of large capacity additions resulting
in oversupply, lower selling prices and lower profits. Like most companies
in the industry, the Company's operations have been affected by the
shortages and delay of rail transportation into and out of the Odessa
plant. Certain of the Company's products, such as APAO, are generally less
sensitive to economic cycles. In addition, the Company's polyethylene and
polypropylene businesses are geared toward higher value-added, specialty
grades, which are less sensitive to cyclical swings experienced by
commodity grades. Management believes that many of the factors contributing
to the lower selling prices experienced by the industry in 1997 will
continue throughout 1998.

            Principal raw materials purchased by the Company consist of
ethane and propane extracted from NGLs, propylene and benzene (all four of
which are referred to as "feedstocks") for the polyethylene, polypropylene
and styrene businesses. Management believes the feedstock supplies
available in Odessa, Texas are currently adequate for the Company's
requirements. The percentage of feedstock costs compared to the Company's
total cost of sales decreased from 30% in 1996 to 28% in 1997. Lower
industry inventory levels of crude oil, natural gas and NGL feedstocks and
unexpected supply disruptions caused feedstock prices to increase during
1996 and early 1997. The Company's inability in 1996 and the first quarter
of 1997 to pass on the full amount of the increases in feedstock costs to
customers had a significant impact on operating results for those periods;
however, feedstock prices decreased midway through the first quarter of
1997 and remained fairly stable throughout the balance of 1997 due to
higher inventory levels and a fairly mild winter season, favorably
impacting the Company's earnings. Management believes that feedstock prices
will trend downward through mid-second quarter 1998 and stabilize
throughout the remainder of the year.

RESULTS OF OPERATIONS

            The Merger of Rexene and Centennial, effective September 1,
1997 (the "Effective Date") for financial accounting purposes, resulted in
the implementation of a new basis of accounting, resulting in new carrying
values for certain of the Company's assets, liabilities and equity.
Huntsman Polymers' consolidated financial statements reflect this new basis
of accounting beginning with the date of the Merger. Effective September
30, 1997, the Company sold the assets of the CT Business. The operations of
the CT Business are presented as discontinued operations for all periods
presented. In order to present data which is useful for comparative
purposes, the following pro forma tabular data and related discussion have
been prepared as if the Merger and the CT Film Sale had taken place at the
beginning of each period presented. These results do not necessarily
reflect the results which would have been obtained if the Merger or the CT
Film Sale had actually occurred on the dates indicated or the results which
may be expected in the future.

            Huntsman Polymers' operations for periods after the Effective
Date are significantly affected by (1) the elimination of the amortization
of the Company's historical reorganization value, (2) the incremental
depreciation associated with the net increase in property, plant, and
equipment, (3) the impact on interest expense of the replacement of
selected debt vehicles with intercompany debt and (4) the deferred income
tax affect adjustments associated with these adjustments. For these
reasons, among others, certain financial information for periods before and
after the Effective Date is not comparable.



SELECTED FINANCIAL RESULTS:

<TABLE>
<CAPTION>

                                                         Actual                      Pro Forma(1)
                                                 Year Ended December 31,        Year Ended December 31,
                                                ---------------------------------------------------------

                                                      1997         1996        1997          1996
                                                      ----         ----        ----          ----
                                                                       (in thousands)
CONSOLIDATED STATEMENT OF OPERATIONS:

<S>                                                 <C>          <C>           <C>           <C>     
Revenues                                            $447,278     $435,297      $447,278      $435,297
Cost of goods sold                                   377,801      330,667       392,457       352,650
                                                  ----------     --------      --------       -------
                                                     69,477       104,630        54,821        82,647
Selling, general and administrative                  26,212        35,369        25,850        32,064
Research and development                              6,163        6,006          6,163         6,006
Reversal of environmental accrual                    (9,000)         -           (9,000)          -
                                                  ----------     --------      ---------     --------
Operating income                                     46,102       63,255        31,808        44,577
Interest expense, net                               (23,713)     (12,629)      (28,833)      (28,601)
Other expense                                       (22,173)      (1,733)      (13,673)         (486)
                                                  ----------    ---------      --------      -------
                                                        216       48,893       (10,698)       15,490
Income tax benefit (expense)                         (1,544)     (18,449)        2,603        (4,975)
                                                  ----------    ---------     ----------    --------
Income (loss) from continuing operations            $ 1,328     $ 30,444      $ (8,095)     $ 10,515
                                                    ========    =========     ==========    ========

-----------------
(1)   Pro forma results reflect purchase accounting adjustments as if
      the Merger had occurred on January 1, 1996 or 1997, as
      applicable.

</TABLE>

COMBINED 1997 COMPARED TO 1996

            The 1997 compared to 1996 items below are discussed in the
context of pro forma results of operations as if the Merger between Rexene
and Centennial had occurred on January 1, 1997 and 1996, as applicable.

Revenues

            The Company's net sales increased $12.0 million (or 3%) from
1996 to 1997 principally due to an increase in the average sales price of
polyethylene, the added sales volumes of the newly commercialized FPO and
to an increase in volumes of feedstock sales, and was partially offset by a
decrease in the sales price of styrene. Polyethylene sales increased $8.0
million (or 5%), principally due to an increase in average sales price of
3.3 cents per pound, partially offset by a decrease in sales volumes of
14.2 million pounds. Styrene sales decreased $8.0 million (or 9%)
principally due to a decrease in sales price of 1.7 cents per pound. APAO
sales decreased $1.5 million (or 6%) principally due to a decrease in sales
price of 4.2 cents per pound. Polypropylene sales decreased $1.0 million
(or 1%) principally due to a decrease in sales volume of 2.8 million
pounds. The FPO plant was completed in late 1996 and FPO sales were $4.5
million in 1997. Other sales increased $9.9 million principally due to an
increase in feedstock volumes sold.

Gross Profit

            The Company's gross profit as a percentage of sales decreased
from 19% in 1996 to 12% in 1997 principally due to factors impacting
styrene, polypropylene and FPO. The decrease in gross profit for styrene
was the result of a $8.0 million decrease in average sales price and $3.5
million of additional manufacturing costs, partially due to an increase in
utility costs. Polypropylene production decreased 11% due to the
implementation of capital projects and mechanical difficulties during 1997
causing a decline in the gross profit of $8.4 million. FPO gross profit
margin was $(6.0) million in 1997, the first year during which the new FPO
plant has operated.

Selling, General and Administrative Expenses

            Selling, general and administrative expenses decreased $6.2
million (or 19%) from 1996 to 1997 due to the settlement of an insurance
claim related to a previously settled lawsuit for approximately $2.3
million, a decrease related to administrative restructuring as the result
of the Merger for approximately $3.1 million in the four months following
the Merger, and an increase of $1.5 million in legal fee reimbursements.
These decreases to selling, general, and administrative expenses were
partially offset by increases to engineering expenses and the reserve for
doubtful accounts.

Reversal of Environmental Accrual

            An environmental accrual established in prior years was reduced
by $9.0 million as a result of modifications to the Company's remedial
action plans at the Company's Odessa Facility that were approved by the
TNRCC.

Interest Expense, Net

            Net interest expense increased $0.2 million (or less than 1%)
from 1996 to 1997.

Other, Net

            Other expense increased $13.2 million from 1996 to 1997,
principally due to the settlement of a lawsuit filed by Phillips. See Item
3 "Legal Proceedings".

Income Tax Expense

            Income tax expense decreased $7.6 million from 1996 to 1997 due
to decreased operating results.

1996 COMPARED TO 1995

            The 1996 compared to 1995 items below are based on historical
data, as restated to reflect the CT business as discontinued operations.

Revenues

            A slowdown in economic growth in the United States, a decrease
in average sales prices for styrene and polyethylene and higher feedstock
prices in the fourth quarter of 1996 resulted in overall lower sales and
profitability in 1996 than 1995. Net sales decreased $9.4 million (2%) from
1995 to 1996 principally due to a decrease in average sales prices in
styrene and polypropylene, offset by increased excess feedstock sales.
Styrene sales decreased $30.4 million (or 25%) principally due to a
decrease in average sales prices of 10 cents per pound, partially offset by
an increase in sales volumes of 9.9 million pounds. Polyethylene sales
decreased $5.0 million (or 3%) due to a decrease in average sales prices of
4 cents per pound, partially offset by an increase in sales volumes of 21.5
million pounds. Polypropylene sales decreased $3.3 million (or 4%)
principally due to a decrease in average sales prices of 2 cents per pound.
APAO sales increased $2.4 million (or 10%) due to higher sales volumes of
4.8 million pounds. Other sales increased $26.9 million principally due to
an increase of excess feedstock sales.

Gross Profit

            The Company's gross profit as a percentage of sales, decreased
from 36% in 1995 to 24% in 1996, principally due to the decrease in average
sales prices for styrene and polyethylene discussed above and an increase
in feedstock costs. Feedstock price increases accounted for $16 million, or
one-third of the 12% reduction in the gross profit percentage in 1996
compared to 1995.

Selling, General and Administrative Expenses

            Selling, general and administrative expenses remained stable
from 1995 to 1996. Research and development expenses also remained
relatively stable from 1995 to 1996.

Interest Expense

            Interest expense decreased $8.4 million (or 37%) principally
due to lower credit line balances and higher capitalized interest on
capital improvements.

Income Tax Expense

            Income tax expense decreased $19.0 million from 1995 to 1996
due to decreased operating results.

LIQUIDITY AND CAPITAL RESOURCES

            Net cash used in operating activities for the combined twelve
months ended December 31, 1997 was $14 million, a decrease of $32 million
over the same period in the prior year. This decrease was primarily
attributable to the decline in net income, a net increase in working
capital, and a net use of cash at the Company's discontinued operations.

            Net cash used in investing activities for the combined twelve
months ended December 31, 1997 was $408 million, an increase of $294
million over the same period in 1996. This increase was primarily
attributable to the accounting treatment of the cash consideration paid by
Centennial in connection with the Merger under "push-down" accounting rules
as well as a higher level of capital spending on the Company's
modernization and expansion program, and was partially offset by the cash
proceeds from the sale of the CT Film assets.

            Net cash provided by financing activities for the combined
twelve months ended December 31, 1997 was $421 million, an increase of $372
million over the same period in the prior year. This increase was primarily
attributable to the net proceeds from the issuance of common stock as well
as the increase of intercompany debt incurred to finance the Merger. Debt
was also used, in part, to finance the Company's modernization and
expansion program.

            In connection with the Merger, the Company entered into an
intercompany loan agreement (the "Loan Agreement") with Huntsman Group
Holdings Finance Company ("HGHFC"), a wholly-owned subsidiary of Huntsman
Corporation. As of December 31, 1997, the Company owed $258.1 million under
the Loan Agreement. Subject to certain terms and conditions, the Company
may borrow additional amounts under the Loan Agreement. The Company has
guaranteed on a secured basis, subject to the limitations imposed by the
indenture governing the Company's 11 3/4% Senior Notes due 2004 (the
"Senior Notes") (the "Indenture"), Huntsman Corporation's senior secured
borrowings on a pari passu basis with substantially all of Huntsman
Corporation's domestic subsidiaries.

            Pursuant to the terms of the Indenture, the Company is required
to make an offer to repurchase the Senior Notes at 101% of the principal
amount plus accrued interest within ten days following a change of control.
The Merger resulted in a change of control event. Therefore the Company
made a change of control offer to repurchase the Senior Notes in accordance
with the terms of the Indenture. The last day the holders of the Senior
Notes could accept such change of control offer was September 30, 1997.
Senior Notes with an aggregate principal amount of $118,000 were
repurchased in connection with the change of control offer.

            On May 8, 1997, the Company entered into a $50 million capital
lease agreement with Estherwood Corporation to finance the facility which
produces FPO. In connection with the Merger, this lease agreement was
amended and restated with HGHFC becoming the lessor. The principal economic
terms of this lease agreement were not altered.

            On September 30, 1997, the Company sold the assets of the CT
Business to Huntsman Packaging, an affiliate of the Company, for $70
million in cash. The proceeds from the CT Film Sale were used to
temporarily repay revolving intercompany indebtedness and will be applied
to the Company's modernization and expansion program as such expenses are
incurred.

            Capital expenditures for the combined twelve months ended
December 31, 1997 were $119 million. The $6 million increase in capital
expenditures from the twelve months ended December 31, 1997 to the same
period in 1996 was due primarily to additional spending in connection with
the Company's modernization and expansion program, partially offset by a
lower level of capital spending at the Company's discontinued operations.
The two primary components remaining in the Company's modernization and
expansion program include the modernization of the Company's olefins
facility and the building of a new LLDPE facility. The Company expects to
complete these projects in the first quarter of 1999 and expects to spend
an additional $200 million to $225 million in connection with these
projects. Substantially all of such additional spending will occur in 1998.

            The Company believes that, based on current levels of operation
and anticipated growth, its cash flow from operations, together with other
available sources of liquidity, will be adequate to make scheduled payments
of interest on the Senior Notes, to permit anticipated capital expenditures
and to fund working capital requirements. However, the ability of the
Company to satisfy these obligations depends on a number of significant
assumptions, including but not limited to, the demand for the Company's
products and raw material costs.

            A number of potential environmental liabilities exist which
relate to certain contaminated property. In addition, a number of potential
environmental costs relate to pending or proposed environmental
regulations. No assurance can be given that all of the potential
liabilities arising out of the Company's present or past operations have
been identified or that the amounts that might be required to investigate
and remediate such sites or comply with pending or proposed environmental
regulations can be accurately estimated. The Company has approximately $8.5
million accrued in the December 31, 1997 balance sheet as an estimate of
its total potential environmental liability with respect to investigating
and remediating known and assessed site contamination. Extensive
environmental investigation of the groundwater, soils and solid waste
management has been conducted at the Odessa Facility. Risk assessments have
been completed for a number of these facilities and corrective measures
have been defined and conducted. If, however, additional liabilities with
respect to environmental contamination are identified, there is no
assurance that additional amounts that might be required to investigate and
remediate such potential sites would have a material adverse effect on the
Company's financial position, results of operations or cash flows. In
addition, future regulatory developments could restrict or possibly
prohibit existing methods of environmental compliance. At this time, the
Company is unable to determine the potential consequences such possible
future regulatory developments would have on its financial condition.
Management continually reviews its estimates of potential environmental
liabilities. The Company carries Pollution Legal Liability insurance to
address many of the potential environmental liabilities, subject to its
terms, limits, exclusions and deductibles, on both a sudden and accidental
basis and on a gradual basis for occurrences first commencing after July 1,
1997 on its operations. The Company also carries Pollution Legal Liability
and Closure and Post Closure insurance on certain facilities at the Odessa
manufacturing location which are regulated by the TNRCC. This insurance
satisfies the requirements of the TNRCC governing operations at this
location.

            The Company historically disposed of its wastewater from the
Odessa Facility through injection wells operated under permits from the
TNRCC. Due to concerns by the agency regarding the operation of these
underground injection wells, and their intention not to renew the permits
after they expired in December 1997, the Company entered into an agreement
in 1995 with the City of Odessa and the Gulf Coast Waste Disposal Authority
pursuant to which the latter is currently disposing of the wastewater
through the refurbished Odessa South Wastewater Treatment Facility, a POTW.
The cost of refurbishing the City's wastewater treatment facility, which
was approximately $8.0 million, has been financed principally by the
Company. This facility was brought on-line in October and November of 1997
and culminates three years of working together to provide a long range,
cost effective wastewater disposal solution. Wastewater is pumped to this
facility where it is mixed with City effluent as well as other industrial
discharges. The water is treated to meet discharge standards before it is
released to an intermittent-flowing stream for further reuse.

Year 2000 Compliance

            In response to the year 2000 compliance issue, the Company has
completed an inventory and assessment of all internally developed or
externally acquired system components. The Company has dedicated the
resources to either replace or remediate all known problems. External
service providers have been contacted and have assured the Company that
they will be 2000 compliant. The total cost to the Company of these efforts
is estimated to be approximately $500,000, with the majority being expensed
in 1998.

Other Matters

            The Company is including the following cautionary statement in
this Form 10-K to make applicable and take advantage of the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995 for any
forward-looking statements made by, or on behalf of, the Company.
Forward-looking statements include statements concerning plans, objectives,
goals, strategies, future events or performance, and underlying assumptions
and other statements which are other than statements of historical facts.
From time to time, the Company may publish or otherwise make available
forward-looking statements of this nature. All such subsequent
forward-looking statements, whether written or oral and whether made by or
on behalf of the Company, are also expressly qualified by these cautionary
statements. Certain statements contained herein are forward-looking
statements and accordingly involve risks and uncertainties which could
cause actual results or outcomes to differ materially from those expressed
in the forward-looking statements. The forward-looking statements contained
herein are based on various assumptions, many of which are based, in turn,
upon further assumptions. The Company's expectations, beliefs and
projections are expressed in good faith and are believed by the Company to
have a reasonable basis, including without limitation, management's
examination of historical operating trends, data contained in the Company's
records and other data available from third parties, but there can be no
assurance that management's expectations, beliefs or projections will
result or be achieved or accomplished. In addition to the other factors and
matters discussed elsewhere herein, the following are important factors
that, in the view of the Company, could cause actual results to differ
materially from those discussed in the forward-looking statement:


            1.      Changes in economic conditions and weather conditions

            2.      Changes in the availability and/or price of feedstocks

            3.      Changes in management or control of the Company

            4.      Inability to obtain new customers or retain existing ones

            5.      Significant changes in competitive factors affecting
                    the Company

            6.      Governmental/regulatory actions and initiatives,
                    including those affecting financings, and
                    environmental/safety requirements

            7.      Significant changes from expectations in actual capital
                    expenditures and operating expenses and unanticipated
                    project delays

            8.      Occurrences affecting the Company's ability to obtain
                    funds from operations, debt or equity to finance needed
                    capital expenditures and other investments

            9.      Regarding foreign operations - changes in foreign trade
                    and monetary policies, laws and regulations related to
                    foreign operations, political and governmental changes,
                    inflation and exchange rates, taxes and operating
                    conditions

            10.     Significant changes in tax rates or policies or in
                    rates of inflation or interest

            11.     Significant changes in the Company's relationship with
                    its employees and the potential adverse effects
                    if labor disputes or grievances were to occur

            12.     Changes in accounting principles and/or the application
                    of such principles to the Company.

            13.     Unavailability of, and substantial delays in,
                    transportation of raw materials and products.

            The Company disclaims any obligation to update and
forward-looking statements to reflect events or circumstances after the
date hereof.

ITEM 8.     FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

            The Company's Consolidated Financial Statements required by
this item are included on the pages immediately following the Index to
Consolidated Financial Statements appearing on page F-1.

ITEM 9.     CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
            ON ACCOUNTING AND FINANCIAL DISCLOSURE

            Effective August 27, 1997, the date of the Merger Agreement
between Centennial, a wholly-owned indirect subsidiary of Huntsman
Corporation, and Rexene, Deloitte & Touche LLP was chosen as the external
accountants for the Company. Huntsman Corporation management elected to
change the external accountants from Price Waterhouse LLP, Rexene's
historical external accountants, to Deloitte & Touche LLP, Huntsman
Corporation's external accountants, for consistency purposes.

                                  PART III

ITEM 10.    DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

DIRECTORS AND EXECUTIVE OFFICERS

            The current directors and executive officers of the Company are
listed below. Directors are elected at the annual meeting of stockholders
and hold office until their successors are duly elected and qualified. All
officers serve at the pleasure of the Board of Directors of the Company.

<TABLE>
<CAPTION>

NAME                                   AGE     POSITION

<S>                                    <C>     <C>  
Jon M. Huntsman* ...................   60      Chairman and Chief Executive Officer, Director
Jon M. Huntsman, Jr.* ..............   38      Vice Chairman, Director
Peter R. Huntsman* .................   35      President, Director
J. Kimo Esplin .....................   35      Senior Vice President and Chief Financial Officer, Treasurer
Michael J. Kern ....................   48      Senior Vice President, Operations
Robert B. Lence ....................   40      Senior Vice President and Chief Legal Officer, Secretary
Donald J. Stanutz ..................   47      Senior Vice President, Sales and Marketing
Monte G. Edlund ....................   42      Vice President, Marketing/Commercial
L. Russell Healy ...................   42      Vice President, Tax
Johnny W. Lasiter ..................   48      Vice President, Manufacturing
James A. Leitch ....................   40      Vice President, Sales
Martin F. Petersen .................   37      Vice President
Daniel J. Subach ...................   50      Vice President, Research and Development

---------------------

*     Such persons are related as follows:  Jon M. Huntsman is the father
      of Peter R. Huntsman and Jon M. Huntsman, Jr.

</TABLE>


            JON M. HUNTSMAN has been Chairman and Chief Executive Officer
and a Director of the Company since August 1997. Mr. Huntsman has served as
Chairman of the Board, Chief Executive Officer and a Director of Huntsman
Corporation, its predecessors and other Huntsman companies for over 25
years. He is also the Chairman and founder of the Huntsman Cancer
Foundation. In addition, Mr. Huntsman serves on numerous charitable, civic,
industry and corporate boards. In 1994, Mr. Huntsman received the
prestigious Kavaler Award as the chemical industry's outstanding Chief
Executive Officer. Mr. Huntsman formerly served as Special Assistant to the
President of the United States and as Vice Chairman of the U.S. Chamber of
Commerce. He serves on the Board of Governors of the American Red Cross.

            JON M. HUNTSMAN, JR. has been Vice Chairman and a Director of
the Company since August 1997. Mr. Huntsman, Jr. also serves on the Boards
of Directors of Huntsman Corporation and its affiliated companies, Owens-
Corning Corporation, and Valassis Communications, Inc. Mr. Huntsman, Jr.
currently serves as Vice Chairman of Huntsman Corporation and its
affiliated companies as well as President of the Huntsman Cancer
Foundation. In addition, from 1991 until 1992, Mr. Huntsman, Jr. was a
Senior Vice President and General Manager of Huntsman Chemical Corporation.
From 1992 until 1993, Mr. Huntsman, Jr. served as United States Ambassador
to the Republic of Singapore. From 1989 until 1990, Mr. Huntsman, Jr.
served as U.S. Deputy Assistant Secretary of Commerce for International
Trade, and from 1990 until 1991, he was U.S. Deputy Assistant Secretary of
Commerce for East Asian and Pacific Affairs. Mr. Huntsman, Jr. currently
serves on the Chemical Manufacturers Association and the American Plastics
Council Boards.

            PETER R. HUNTSMAN has been President and a Director of the
Company since August 1997. Mr. Huntsman is the President and Chief
Operating Officer and a Director of Huntsman Corporation and its affiliated
companies including Huntsman Petrochemical Corporation and Huntsman
Chemical Corporation. He was formerly a Senior Vice President of Huntsman
Packaging Corporation and Huntsman Chemical Corporation. From 1991 until
1992, Mr. Huntsman was Senior Vice President and General Manager of
Huntsman Polypropylene Corporation and from 1990 until 1992, he was Vice
President--Purchasing of Huntsman Chemical Corporation.

            J. KIMO ESPLIN has been Senior Vice President and Chief
Financial Officer of the Company since August 1997. Mr. Esplin has been
Senior Vice President and Chief Financial Officer of Huntsman Corporation
and its affiliated companies since Spring of 1997. From 1994 to 1996, Mr.
Esplin was Vice President and Treasurer of Huntsman Corporation and
affiliated companies. Prior to joining Huntsman, Mr. Esplin was a Vice
President of Bankers Trust Company, where he worked for seven years.

            MICHAEL J. KERN has been Senior Vice President, Operations
since August 1997. Mr. Kern is also Senior Vice President, Manufacturing of
Huntsman Corporation, Huntsman Chemical Corporation, and Huntsman
Petrochemical Corporation. Prior to joining Huntsman Corporation and
affiliated companies in 1994, Mr. Kern held a variety of positions with
Texaco Chemical Company, including Area Manager--Jefferson County
Operations from 1993, Plant Manager of Port Neches Chemical Plant from 1992
to 1993, Manager of PO/MTBE project from 1989 to 1992 and Manager of
Operations--Oxides and Olefins from 1988 to 1989.

            ROBERT B. LENCE has been Senior Vice President and Chief Legal
Officer and Secretary of the Company since August 1997. Mr. Lence is also
Senior Vice President and General Counsel and Secretary of Huntsman
Corporation and affiliated companies. Prior to joining Huntsman in 1991,
Mr. Lence was a partner with Van Cott, Bagley, Cornwall & McCarthy, a Salt
Lake City law firm with which he had been associated since 1982.

            DONALD J. STANUTZ has been Senior Vice President, Sales and
Marketing of the Company since August 1997. Mr. Stanutz is also Senior Vice
President, Olefins and Performance Chemicals of Huntsman Corporation and
Senior Vice President, Performance Chemicals of Huntsman Petrochemical
Corporation. Prior to joining Huntsman Corporation and affiliated companies
in 1994, Mr. Stanutz was Business Unit Manager of Texaco Chemical Company
from 1993 to 1994; Manager--Olefins from 1992 to 1993; General
Manager--Chemical Department of Texaco Chemical Company from 1993 to 1994;
General Manager--Chemical Department of Texaco Limited, UK from 1990 to
1992; and Assistant Chemical Manager--Chemical Department from 1989 to
1990.

            MONTE G. EDLUND has been Vice President, Marketing/Commercial
of the Company since August 1997. Prior to the Merger, Mr. Edlund held the
following positions with Rexene Corporation: Vice President-- Marketing,
1995-August 1997; Director--Polymers Marketing, 1994-1995;
Director--Polymer Sales, 1993-1994; Director--Polypropylene Marketing,
1992-1993; and Regional Sales Manager, 1989-1992. From 1981 to 1989, Mr.
Edlund held several positions in the Chemicals Group of Phillips Petroleum
Co., including technical, sales, marketing, and sales management in
chemicals and polyethylene.

            L. RUSSELL HEALY has been Vice President, Tax of the Company
since August 1997. Mr. Healy is also Vice President, Tax of Huntsman
Corporation and affiliated companies. Prior to joining Huntsman Corporation
in 1995, Mr. Healy was a partner with Deloitte & Touche LLP. Mr. Healy is a
Certified Public Accountant.

            JOHNNY W. LASITER has been Vice President, Manufacturing of the
Company since August 1997. Prior to the Merger, Mr. Lasiter had been, since
1991, Vice President of Manufacturing and General Manager of the Odessa
Complex of Rexene Products Co. and had served in various positions with
Rexene Products Co. since 1977.

            JAMES A. LEITCH has been Vice President, Sales of the Company
since August 1997. Prior to the Merger, Mr. Leitch was Vice President,
Sales for Rexene since March 1995. Since joining Rexene in February 1985,
Mr. Leitch has worked in sales in both the polymers and petrochemicals
aspects of the business and has held various positions with Rexene, serving
as Sales Manager, Southern Region from October 1987 to December 1992,
Business Director, Polyethylene from January 1993 to December 1993 and
Sales Director from January 1994 to March 1995. Prior to joining Rexene,
Mr. Leitch was with Union Carbide from 1980 to 1985 in Engineering and
Sales.

            MARTIN F. PETERSEN has been Vice President of the Company since
August 1997. Mr. Petersen is also Vice President and Treasurer of Huntsman
Corporation and affiliated companies. Prior to joining Huntsman Corporation
in 1997, Mr. Petersen was a Vice President in the Investment Banking
Division of Merrill Lynch & Co. where he worked for seven years.

            DANIEL J. SUBACH has been Vice President, Research and
Development of the Company since August 1997. From February 1997 until the
Merger, Dr. Subach was Vice President, Research & Development/Materials
with Rexene. Dr. Subach has over fifteen years of experience in the
specialty chemical and polymer business. From September 1994 to February
1996, Dr. Subach was General Manager for Callery Chemical Company, Division
of MSA. Dr. Subach was Vice President, Product Development for the W. H.
Brady Company from 1991 to 1994.

            Section 16(a) of the Securities Exchange Act of 1934, as
amended (the "1934 Act"), requires directors and officers of the Company,
and persons who own more than 10 percent of the Common Stock, to file with
the Securities and Exchange Commission (the "SEC") initial reports of
ownership and reports of changes in ownership of the Common Stock.
Directors, officers and more than 10 percent stockholders are required by
SEC regulations to furnish the Company with copies of all Section 16(a)
forms they file. To the Company's knowledge, based solely on a review of
the copies of such reports furnished to the Company and written
representations that no other reports were required, during the year ended
December 31, 1997, all Section 16(a) filing requirements applicable to its
directors, officers and more than 10 percent beneficial owners were met.

ITEM 11.  EXECUTIVE COMPENSATION

SUMMARY COMPENSATION TABLE

            The following table sets forth certain summary information
concerning the compensation paid or awarded to the Chief Executive Officer
of the Company, the four other highest paid executive officers of the
Company in 1997 and two additional executive officers for whom disclosure
would have been provided but for the fact that they were not serving as
executive officers at the end of the last completed fiscal year (the "named
executive officers") for the years indicated.

<TABLE>
<CAPTION>

                                                                 SUMMARY COMPENSATION TABLE

                                                                                  ANNUAL COMPENSATION

                                                                                           OPTIONS
                                                                                          (NUMBER OF      ALL OTHER
                NAME AND PRINCIPAL POSITION               YEAR      SALARY      BONUS       SHARES)      COMPENSATION

<S>                                                       <C>        <C>        <C>         <C>            <C>       
Jon M. Huntsman, Chairman of the Board and
Chief Executive Officer(1)............................... 1997       $17,600    $90,000           -        $10,600(2)

Andrew J. Smith, Former Chairman of the Board
and Chief Executive Officer.............................. 1997      $316,672   $357,186           -     $3,291,272(3)
                                                          1996       452,088    357,186      80,000             6,300
                                                          1995       431,671    469,808           -             7,176

Jonathan R. Wheeler, Former Executive Vice
President and President of CT Film....................... 1997      $156,672   $138,914          --     $1,599,693(4)
                                                          1996       225,845    138,914      40,000             3,573
                                                          1995       206,675    190,630          __             3,548

Jack E. Knott, Former Executive Vice President 
and                                                       1997      $255,425   $160,162          __     $1,413,382(5)
President of Rexene Products............................. 1996       241,267    160,162      40,000             3,106
                                                          1995       221,675    203,338          __             3,542

                                                          1997      $136,500    $77,681          __       $407,041(6)
Johnny W. Lasiter, Vice President, Manufacturing......... 1996       136,500     82,602      11,000             2,944
                                                          1995       130,000     39,000          __             3,813

                                                          1997      $124,000    $73,462          __       $321,865(7)
James A. Leitch, Vice President, Sales................... 1996       118,500     73,071      15,000             2,025
                                                          1995       112,501     20,000          __             2,609

Monte G. Edlund, Vice President,                          1997      $125,000    $73,374          __       $315,433(8)
Marketing/Commercial..................................... 1996       119,500     72,662      15,000             2,177
                                                          1995       114,293     21,100          __             2,776

Daniel J. Subach, Vice President, Research and            1997      $100,625     $5,425          __        $82,117(9)
Development..............................................

</TABLE>

-----------------

(1)    Jon M. Huntsman's compensation was paid entirely by Huntsman
       Corporation, the Company's parent. Compensation figures for Jon M.
       Huntsman represent a prorated percentage of Huntsman Corporation
       compensation attributable to services rendered to the Company.

(2)    Consists of $2,100 employer's 401(k) contribution and $8,500 Money
       Purchase Plan contribution.

(3)    Consists of a severance payment of $3,286,397 in 1997, Company
       contributions to employee benefit plans (and related cash
       supplements) of $2,175, $2,250 and $4,584 in 1997, 1996 and 1995
       respectively, and imputed income for life insurance of $2,700,
       $4,050 and $2,592 for 1997, 1996 and 1995, respectively.

(4)    Consists of a severance payment of $1,596,541 in 1997, Company
       contributions to employee benefit plans (and related cash
       supplements) of $2,175, $2,175 and $2,812 in 1997, 1996 and 1995,
       respectively, and imputed income for life insurance of $977, $1,398
       and $736 in 1997, 1996 and 1995, respectively.

(5)    Consists of a severance payment of $1,410,289 in 1997, Company
       contributions to employee benefit plans (and related cash
       supplements) of $2,175, $2,225 and $2,744 in 1997, 1996 and 1995,
       respectively, and imputed income for life insurance of $918, $881
       and $798 in 1997, 1996 and 1995, respectively.

(6)    Consists of a cash payment in connection with the Merger for
       outstanding stock options of $261,212 in 1997, a $143,006 payment in
       connection with an employee incentive plan paid at the time of the
       Merger, Company contributions to employee benefit plans (and related
       cash supplements) of $2,047, $2,175 and $3,082 in 1997, 1996 and
       1995, respectively, and imputed income for life insurance of $776,
       $769 and $731 in 1997, 1996 and 1995, respectively.

(7)    Consists of a cash payment in connection with the Merger for
       outstanding stock options of $168,817 in 1997, a $132,025 payment in
       connection with an employee incentive plan paid at the time of the
       Merger, reimbursement of relocation costs of $18,905 in 1997,
       Company contributions to employee benefit plans (and related cash
       supplements) of $1,860, $1,778 and $2,391 in 1997, 1996 and 1995,
       respectively, and imputed income for life insurance of $258, $247
       and $218 in 1997, 1996 and 1995, respectively.

(8)    Consists of a cash payment in connection with the Merger for
       outstanding stock options of $172,968 in 1997, a $140,189 payment in
       connection with an employee incentive plan paid at the time of the
       Merger, Company contributions to employee benefit plans (and related
       cash supplements) of $1,875, $1,793 and $2,425 in 1997, 1996 and
       1995, respectively, and imputed income for life insurance of $401,
       $384 and $351 in 1997, 1996 and 1995, respectively.

(9)    Consists of a $48,125 payment in connection with an employee
       incentive plan paid at the time of the Merger, reimbursement of
       relocation expenses of $31,935 in 1997, Company contributions to
       employee benefit plans (and related cash supplements) of $1,150 in
       1997, and imputed income for life insurance of $907 in 1997.

OPTION GRANTS, EXERCISES AND HOLDINGS

       No options to purchase common stock of the Company were granted
during the year ended December 31, 1997 to any named executive officers. No
named executive officer exercised options to purchase Common Stock in 1997.
There were no unexercised options to purchase Common Stock held at December
31, 1997 by any of the Company's named executive officers. Any unexercised
options were purchased by Centennial in connection with the Merger.

RETIREMENT PLANS

       During 1997, the Company maintained a trusteed non-contributory
defined benefit pension plan (the "Rexene Retirement Plan") for
substantially all non-union employees. The normal retirement age of
participants is 65. An employee is entitled, subject to various Internal
Revenue Code limitations, to annual pension benefits equal to 0.9% of the
employee's average annual base salary during the highest paid three
consecutive years of the employee's final ten calendar years of service
("Final Average Pay") multiplied by years of service under the Rexene
Retirement Plan, plus 0.5% of the employee's Final Average Pay which
exceeds an average, computed under Internal Revenue Service rules, of the
employee's wages taken into account for social security purposes,
multiplied by the number of years of the employee's participation in the
Rexene Retirement Plan (up to a maximum of 35 years). All of the named
executive officers except for Mr. Jon M. Huntsman were eligible to
participate in the Rexene Retirement Plan in 1997.

       In October 1994, the Company adopted the Rexene Corporation
Supplemental Executive Retirement Plan (the "Rexene SERP"), which was
amended in 1996. The purposes of the Rexene SERP are to provide
supplemental retirement and survivor benefits, in addition to amounts
payable under the Rexene Retirement Plan, for a certain select group of
management or highly compensated employees who complete a specified period
of service and otherwise become eligible under the Rexene SERP. Although
the general assets of the Company are the source of funds for the Rexene
SERP, the benefit obligations that had accrued under the Rexene SERP as the
date of the Merger were contributed in the form of annuities to a "rabbi
trust" established for this purpose. Participants in the Rexene SERP are
entitled on or after age 60 and completion of 15 years of service from and
after the later to occur of January 1, 1988 and their employment
commencement date to receive monthly pension benefits which, when
aggregated with benefits payable under the Rexene Retirement Plan equal 65%
of the monthly average of Final Average Pay multiplied by the participant's
percentage of vesting and credited service under the Rexene SERP.
Generally, participants vest 20% for each of the first five years of
service, commencing October 1, 1994. Such pension benefits will be paid to
the extent allowable under the Internal Revenue Code from the Rexene
Retirement Plan and thereafter from the Rexene SERP. In addition, benefits
payable to participants in the Rexene SERP who have less than 15 years of
service will be reduced at the rate of 62/3% per year. If a participant
elects to retire prior to age 60, he is eligible to receive benefits upon
reaching age 55 and in such event his benefits under the Rexene SERP may be
reduced in an amount not to exceed 10% for each year of early retirement.
Under the Rexene Retirement Plan pension payments will be permitted in
excess of the limit imposed by the Internal Revenue Code under the Rexene
Retirement Plan, which in 1997 provides that the highest annual salary on
which benefits can be calculated is $160,000. Messrs. Smith, Wheeler and
Knott participated in the Rexene SERP in 1997.

       The following table illustrates the amount of annual pension
benefits payable under the Rexene Retirement Plan in specified average
earnings and years of service classifications to each of Messrs. Lasiter,
Leitch, Edlund and Subach. (Benefits payable to Messrs. Smith, Wheeler and
Knott under the Rexene Retirement Plan and the Rexene SERP combined are
reflected in the Pension Plan Table next following the table set forth
below.) Benefit payments under the Rexene Retirement Plan are not subject
to any reduction for social security benefits or other offset amounts.
Benefits are calculated on a straight life annuity basis.

<TABLE>
<CAPTION>

                                  REXENE RETIREMENT PLAN TABLE

                                    Years of Benefit Service at Retirement
                              ---------------------------------------------------

Final Average Pay            5          10       15         20         25       30
---------------------------------------------------------------------------------------
<S>    <C>                  <C>       <C>        <C>       <C>       <C>        <C>   
       $100,000             7,000     14,000     21,000    28,000    35,000     42,000
       $125,000             8,800     17,500     26,300    35,000    46,800     52,500
       $150,000            10,500     21,000     31,500    42,000    52,500     63,000
       $175,000            11,200     22,400     33,600    44,800    56,000     67,200

</TABLE>


            For purposes of calculation of benefits under the Rexene
Retirement Plan, only credited service since 1984 count in the benefit
formula. The number of completed years of credited service as of December
31, 1997 under the Rexene Retirement Plan for each of Messrs. Lasiter,
Leitch, Edlund and Subach were 14, 12, 8 and 0, respectively.

            The following table illustrates the amount of estimated annual
pension benefits payable under the Rexene Retirement Plan and the Rexene
SERP in specified average annual earnings and years of service
classifications to each of Messrs. Smith, Wheeler and Knott. Benefit
payments under the Rexene SERP are not subject to any reduction for social
security benefits or other offset amounts. Benefits are calculated on a
straight life annuity basis. All of the current participants in the Rexene
SERP are 100% vested in their accrued benefits in such plan.


                             REXENE RETIREMENT PLAN AND SERP TABLE

                                Years of Benefit Service at Retirement
                          ---------------------------------------------------


Final Average Pay        5          10           15         20         25
-----------------------------------------------------------------------------

       $100,000      $   21,667    $43,336  $   65,000 $  65,000  $  65,000
        125,000          27,083     54,167      81,250    81,250     81,250
        150,000          32,500     65,000      97,500    97,500     97,500
        175,000          37,917     75,833     113,750   113,750    113,750
        200,000          43,333     86,667     130,000   130,000    130,000
        300,000          65,000    130,000     195,000   195,000    195,000
        400,000          86,667    173,333     260,000   260,000    260,000


            For purposes of calculation of benefits under the Rexene
Retirement Plan, only credited service since 1984 count in the benefits
formula. As a result of the Merger, participants were credited with
additional service under the Rexene SERP to age 60. For purposes of
calculation of benefits under the Rexene SERP (and effectively under the
Rexene SERP and Rexene Retirement Plan combined), the years of credited
service for each such named executive officer as of December 31, 1997 were
as follows: Mr. Smith -- fourteen years; Mr. Wheeler -- 23 years and Mr.
Knott -- 26 years.

            Effective January 1, 1998, executives of the Company will
participate in the Huntsman Corporation Defined Benefit Pension Plan (the
"Huntsman Corporation Pension Plan").

            The following table sets forth the total combined estimated
annual benefits payable under the Huntsman Corporation Pension Plan and the
Huntsman Corporation Supplemental Pension Plan (the "Hunstman SERP") in
specified final average earnings and years-of-service classifications to
Mr. Jon M. Huntsman.


<TABLE>
<CAPTION>

                                      Years of Benefit Service at Retirement
                  -------------------------------------------------------------------------

   Final Average
    Compensation          5        10        15        20         25       30      35       40
---------------------------------------------------------------------------------------------------
<S>      <C>             <C>      <C>       <C>      <C>         <C>     <C>      <C>      <C>    
         $100,000        $7,000   $14,000   $21,000  $28,000     $35,000 $42,000  $49,000  $56,000
         $125,000         8,800    17,500    26,300   35,000      43,800  52,500   61,300   70,000
         $150,000        10,500    21,000    31,500   42,000      52,500  63,000   73,500   84,000
         $175,000        12,300    24,500    36,800   49,000      61,250  73,500   85,800   98,000

</TABLE>

            The current Huntsman Corporation Pension Plan benefit is based
on the following formula: 1.4% of average final compensation multiplied by
years of credited service, minus 1.4% of estimated Social Security benefits
multiplied by years of credited service (maximum 50% of Social Security).
Final average compensation for the Huntsman Corporation Pension Plan is
based on the highest average of three consecutive years compensation. Mr.
Jon M. Huntsman was a participant in the Huntsman Corporation Pension Plan
in 1997, and his covered compensation, which consists of base pay, is
reflected in the Salary column of the Summary Compensation Table. Federal
regulations require that for the 1997 plan year no more than $160,000 in
compensation be considered for the calculation of retirement benefits from
the Huntsman Corporation Pension Plan, and the maximum amount paid from a
qualified defined benefit plan cannot exceed $125,000, as of January 1,
1997. Benefits are calculated on a straight life annuity basis. The benefit
amounts under the Huntsman Corporation Pension Plan are offset for Social
Security benefits.

            The Huntsman SERP is a non-qualified supplemental pension plan
for designated executive officers that provides benefits based on certain
compensation amounts not included in the calculation of benefits payable
under the qualified Huntsman Corporation Pension Plan. Mr. Jon M. Huntsman
was a participant in the Huntsman SERP in 1997, and his compensation
amounts taken into account for purposes of the plan include bonuses (as
reflected under the "Bonus" column of the Summary Compensation Table for
Mr. Huntsman) and base pay in excess of the qualified plan limitations. The
Huntsman SERP benefit is calculated as the difference between (a) and (b)
where (a) is the benefit determined using the Huntsman Corporation Pension
Plan formula with unlimited base pay and bonus and (b) is the benefit
determined using base pay as limited by federal regulations.

            The number of completed years credited as of December 31, 1997
under the Huntsman Corporation Pension Plan and the Huntsman SERP for Mr.
Jon M. Huntsman was 27.

COMPENSATION OF DIRECTORS

            Fees and Expenses. Prior to the Merger, each director who is
not an employee of the Company received a fee of $1,000 for each meeting of
the Board attended, $1,000 for each committee meeting attended which was
not held on the same day as a Board meeting and an annual fee of $10,000
payable in quarterly installments. Each Director elected to the Board in
1997 also received options to acquire 2,000 shares of Common Stock at an
exercise price equal to the fair market value of the shares on the date of
grant, less $10.00 per share. Any unexercised options held by directors
were purchased by Centennial in connection with the Merger. The Company
also reimbursed directors for travel, lodging and related expenses they
incurred in attending Board and committee meetings. After the Merger,
directors have been serving without compensation from the Company.

EMPLOYMENT AGREEMENTS

            Any employment arrangements with executive officers were
terminated in connection with the Merger. There are currently no employment
agreements with any executive officers.

ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
            OWNERS AND MANAGEMENT

            The Company has 1,000 shares of common stock, par value $0.01
per share, issued and outstanding. The Company is a wholly-owned subsidiary
of Huntsman Polymers Holdings Corporation, which is a wholly-owned
subsidiary of Huntsman Corporation, 500 Huntsman Way, Salt Lake City, Utah
84108. Huntsman Corporation is 99.6% owned by Jon M. Huntsman and his
family. No other director, executive officer or person beneficially owns
any shares of common stock of the Company.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

            On August 27, 1997, Huntsman Centennial Corporation, a Delaware
corporation and a subsidiary of Huntsman Corporation, was merged with and
into Rexene, and Rexene changed its name to Huntsman Polymers Corporation.
The Merger occurred pursuant to the Merger Agreement. The stockholders of
Rexene approved the Merger Agreement at a Special Meeting held on August
26, 1997. In the Merger, each of the shares of Common Stock of Rexene
(other than dissenting shares and shares held by Huntsman Corporation,
Centennial or Rexene) were cancelled and converted into the right to
receive $16.00 in cash, without interest. As a result of the Merger,
Huntsman Corporation indirectly owns all of the Common Stock of the
Company, and the Company thus became an indirect subsidiary of Huntsman
Corporation.

            In conjunction with the Merger, Centennial entered into a loan
agreement with an affiliate, HGHFC, and borrowed approximately $131.1
million under this agreement. Additionally, Centennial received an equity
contribution from its parent company, HPHC, in the amount of $173.5
million. After the Merger, the Company entered into a loan agreement with
HGHFC and borrowed $225.1 million, of which a portion of the proceeds were
used to repay to original debt incurred by Centennial and assumed by the
Company. As of December 31, 1997, the Company owed $258.1 million under the
Loan Agreement. Subject to certain terms and conditions, the Company may
borrow additional amounts under the Loan Agreement.

            Also, at the time of the Merger, the Company guaranteed on a
secured basis, subject to the limitations imposed by the Indenture,
Huntsman Corporation's senior secured borrowings on a pari passu basis with
substantially all of Huntsman Corporation's domestic subsidiaries.

            On August 27, 1997, the Company amended an existing Capital
Lease Agreement between the Company and Estherwood Corporation effectively
assigning all of Estherwood's rights under the agreement to HGHFC. The
value of the capital lease at the time of assignment was $50.0 million plus
accrued interest. The Company is obligated to make quarterly interest
payments to HGHFC effective the quarter ended December 31, 1997 and
quarterly lease payments commencing the quarter ended December 31,1998
through September 30, 2002 (see note 9).

            On September 30, 1997, the Company completed the CT Film Sale
to Huntsman Packaging, an affiliate of the Company, pursuant to the Asset
Purchase Agreement, by and between the Company and Huntsman Packaging.
Pursuant to the terms of the Asset Purchase Agreement, the Company
transferred the CT Business, including, among other things, its properties,
film manufacturing facilities, sales offices, warehouses, inventory,
technology and contracts that relate to the CT Business. In consideration
for the transfer of the assets of the CT Business, the Company received $70
million in cash. The terms of the Asset Purchase Agreement were mutually
agreed upon by the Company and Huntsman Packaging and were based upon
arm's-length negotiations, taking into account various factors concerning
the valuation of the CT Business.

            A summary of transactions between the Company and other related
parties as of, and for the year ended, December 31, 1997, is summarized as
follows (dollars in thousands):

             Sales to:
                      Huntsman Petrochemical Corporation             $     596
                      Huntsman Chemical Corporation                      2,500
                      Huntsman Corporation                              69,073
             Trade accounts receivable from:
                      Hunstman Corporation                              69,428
             Payroll receivable from:
                      Huntsman Packaging Corporation                     6,148
             Other miscellaneous receivables from:
                      Huntsman Packaging Corporation                     1,507
                      Huntsman Corporation                                 586
                      Employee advances                                    727
             Product purchases from:
                      Huntsman Petrochemical Corporation                   766
             Interest expense paid to:
                      Huntsman Group Holdings Finance Company            7,568
             Miscellaneous accounts payable to:
                      Huntsman Petrochemical Corporation                   884
                      Huntsman Packaging Corporation                       562
                      Huntsman Corporation                               4,958
             Long-term debt payable to:
                      Huntsman Group Holdings Finance Company          258,055
             Long-term capital lease payable to:
                      Huntsman Group Holdings Finance Company
                        (including accrued interest)                   51, 535


ITEM 14.    EXHIBITS, FINANCIAL STATEMENT
            SCHEDULES AND REPORTS ON FORM 8-K

(a) 1.      Consolidated Financial Statements:

            See Index to Consolidated Financial Statements on page F-1.

    2.      Financial  Statement Schedules:

            See Index to Consolidated Financial Statements on page F-1.

    3.      Exhibits:

    2.1     --    First Amended Plan of Reorganization of Rexene Products
                  Company, et al., dated April 29, 1992 (filed as Exhibit
                  2.1 to the Company's Form 8-K Current Report dated July
                  7, 1992 and incorporated herein by reference).

    2.2     --    Order Confirming First Amended Plan of Reorganization,
                  dated April 29, 1992 (filed as Exhibit 2.2 to Rexene
                  Corporation's (now known as Huntsman Polymers
                  Corporation) Annual Report on Form 10-K for the fiscal
                  year ended December 31, 1992 and incorporated herein by
                  reference).

    2.3     --    Plan and Agreement of Merger, between Rexene Corporation
                  and Rexene Products Company, dated as of September 11,
                  1992 (filed as Exhibit 2.3 to Rexene Corporation's (now
                  known as Huntsman Polymers Corporation) Annual Report on
                  Form 10-K for the fiscal year ended December 31, 1992 and
                  incorporated herein by reference).

    2.4     --    Agreement and Plan of Merger by and among Huntsman
                  Corporation, Huntsman Centennial Corporation and Rexene
                  Corporation dated June 9, 1997.

    3.1     --    Restated Certificate of Incorporation and the Certificate
                  of Amendment to the Certificate of Incorporation (filed
                  as Exhibit 3(i) to Rexene Corporation's (now known as
                  Huntsman Polymers Corporation) Quarterly Report on Form
                  10-Q for the quarterly period ended September 30, 1997
                  and incorporated by reference).

    3.2     --    By-Laws (filed as Exhibit 3(ii) to Rexene Corporation's
                  (now known as Huntsman Polymers Corporation) Quarterly
                  Report on Form 10-Q for the quarterly period ended
                  September 30, 1997 and incorporated herein by reference).

    4.1     --    Indenture, dated as of November 29, 1994, between Rexene
                  Corporation, as Issuer, and Bank One, Texas, N.A., as
                  Trustee, for $175,000,000 11 3/4% Senior Notes due 2004
                  (filed as Exhibit 4.1 to Rexene Corporation's (now known
                  as Huntsman Polymers Corporation) Annual Report on Form
                  10-K for the fiscal year ended December 31, 1994 and
                  incorporated herein by reference).

    4.2.1   --    Stockholder Rights Agreement, between Rexene Corporation
                  and American Stock Transfer & Trust Company, as Rights
                  Agent, dated as of January 26, 1993 (filed as Exhibit
                  4.20 to Rexene Corporation's (now known as Huntsman
                  Polymers Corporation) Annual Report on Form 10-K for the
                  fiscal year ended December 31, 1992 and incorporated
                  herein by reference).

    4.2.2   --    Amendment No. 1 to Stockholder Rights Agreement (filed as
                  Exhibit 1 to Rexene Corporation's (now known as Huntsman
                  Polymers Corporation) Form 8-A/A filed on October 21,
                  1994 and incorporated herein by reference).

    4.2.3   --    Amendment No. 2 to Stockholder Rights Agreement (filed as
                  Exhibit 99.4 to Rexene Corporation's (now known as
                  Huntsman Polymers Corporation) Form 8-A/A filed on July
                  26, 1996 and incorporated herein by reference).

    10.1*   --    Rexene Corporation 1988 Stock Incentive Plan (filed as
                  Exhibit 10.5 to Rexene Corporation's (now known as
                  Huntsman Polymers Corporation) Registration Statement on
                  Form S-1 (SEC No. 33-22723) and incorporated herein by
                  reference).

    10.2*   --    Rexene Corporation 1993 Non-Qualified Stock Option Plan
                  (filed as Exhibit 10.2 to Rexene Corporation's (now known
                  as Huntsman Polymers Corporation) Annual Report on Form
                  10-K for the fiscal year ended December 31, 1992 and
                  incorporated herein by reference).

    10.3*   --    Rexene Corporation 1994 Long-Term Incentive Plan (filed
                  as Exhibit 10.2 to Amendment No. 1 to Rexene
                  Corporation's (now known as Huntsman Polymers
                  Corporation) Registration Statement on Form S-3 (SEC File
                  No. 33-55507) as filed on October 21, 1994 and
                  incorporated herein by reference).

    10.4*   --    Non-Qualified Stock Option Plan for Outside Directors of
                  Rexene Corporation's (now known as Huntsman Polymers
                  Corporation) (filed as Exhibit 10.3 to Rexene
                  Corporation's Annual Report on Form 10-K for the fiscal
                  year ended December 31, 1992 and incorporated herein by
                  reference).

    10.5*  --     1995 Stock Option Plan for Outside Directors (filed as
                  Exhibit 10.19 to Rexene Corporation's (now known as
                  Huntsman Polymers Corporation) Form 10-Q Quarterly Report
                  for the quarterly period ended June 30, 1995 and
                  incorporated herein by reference).

    10.6*   --    Rexene Corporation Supplemental Executive Retirement Plan
                  (filed as Exhibit 10.3 to Amendment No. 1 to Rexene
                  Corporation's (now known as Huntsman Polymers
                  Corporation) Registration Statement on Form S-3 (SEC File
                  No. 33-55507) as filed on October 21, 1994 and
                  incorporated herein by reference).

    10.6.1* --    Amendment No. 1 to Rexene Corporation Supplemental
                  Executive Retirement Plan, dated as of June 1, 1996
                  (filed as Exhibit 10.6.1 to Rexene Corporation's (now
                  known as Huntsman Polymers Corporation) Quarterly Report
                  on Form 10-Q for the quarterly period ended June 30, 1996
                  and incorporated herein by reference).

    10.6.2* --    Amendment No. 2 to Rexene Corporation Supplemental
                  Executive Retirement Plan, dated as of July 26, 1996
                  (filed as Exhibit 10.6.2 to Rexene Corporation's (now
                  known as Huntsman Polymers Corporation) Quarterly Report
                  on Form 10-Q for the quarterly period ended June 30, 1996
                  and incorporated herein by reference).

    10.7.1* --    Rexene Corporation 1995 Annual Incentive Bonus Plan
                  (filed as Exhibit 10.6.3 to Rexene Corporation's (now
                  known as Huntsman Polymers Corporation) Annual Report on
                  Form 10-K for the fiscal year ended December 31, 1994 and
                  incorporated herein by reference).

    10.7.2* --    Rexene Corporation Executive Management Committee Annual
                  Incentive Plan (filed as Exhibit 10.7.2 to Rexene
                  Corporation's (now known as Huntsman Polymers
                  Corporation) Annual Report on Form 10-K for the fiscal
                  year ended December 31, 1996 and incorporated herein by
                  reference).

    10.7.3* --    Rexene Corporation 1996 Performance Unit Program for
                  Executive Officers (filed as Exhibit 10.7.3 to Rexene
                  Corporation's (now known as Huntsman Polymers
                  Corporation) Annual Report on Form 10-K for the fiscal
                  year ended December 31, 1996 and incorporated herein by
                  reference).

    10.7.4* --    Rexene Corporation Long Term Performance Unit Program for
                  Executive Officers (filed as Exhibit 10.7.4 to Rexene
                  Corporation's (now known as Huntsman Polymers
                  Corporation) Annual Report on Form 10-K for the fiscal
                  year ended December 31, 1996 and incorporated herein by
                  reference).

    10.8    --    First Amended Asset Purchase Agreement, dated as of
                  September 26, 1997, between Huntsman Polymers Corporation
                  and Huntsman Packaging Corporation (filed as Exhibit 2.1
                  to Huntsman Polymers Corporation's Current Report on Form
                  8-K filed on October 21, 1997 and incorporated herein by
                  reference).

    10.9    --    Intercompany Loan Agreement, dated as of August 27, 1997,
                  between Huntsman Group Holdings Finance Corporation and
                  Huntsman Polymers Corporation, dated as of August 27,
                  1997 (filed as Exhibit 10.1 to Huntsman Polymers
                  Corporation's Quarterly Report on Form 10-Q for the
                  quarterly period ended September 30, 1997 and
                  incorporated by reference).

    16.1    --    Letter re: Change in Certifying Accountant (filed as
                  Exhibit 16 to Huntsman Polymers Corporation's Current
                  Report on Form 8-K filed on August 29, 1997 and
                  incorporated herein by reference).

    21.1    --    Subsidiaries of Huntsman Polymers Corporation.

    27.1    --    Financial Data Schedule.

--------------------

 *     Management contract or compensatory plan or arrangement required to
       be filed as an exhibit hereto.

(b)    The Company filed a Form 8-K on October 21, 1997 describing the sale
       of the CT Business to Huntsman Packaging Corporation.


                                 SIGNATURES

            Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Registrant has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.

                                             HUNTSMAN POLYMERS CORPORATION


  Dated March 31, 1998                       By:   /s/  J. Kimo Esplin
                                                   -------------------
                                                   J. Kimo Esplin
                                                   Senior Vice President and
                                                   Chief Financial Officer

            Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed by the following persons on behalf of the
registrant and in the capacities indicated on March 31, 1998.

             SIGNATURE                     TITLE

      /s/  Jon M. Huntsman          Chairman of the Board and Chief Executive
      _______________________       Officer and Director (Principal
          JON M. HUNTSMAN           Executive Officer)

     /s/  Jon M. Huntsman, Jr.      Vice Chairman and Director
     _________________________
          JON M. HUNTSMAN, JR.

     /s/  Peter R. Huntsman         President and Director
     __________________________
         PETER R. HUNTSMAN

     /s/  J. Kimo Esplin            Senior Vice President,
     __________________________     Chief Financial Officer (Principal
          J. KIMO ESPLIN            Financial and Accounting Officer)




               HUNTSMAN POLYMERS CORPORATION AND SUBSIDIARIES
                             ITEMS 8 AND 14(a)

                 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

                                                                       PAGE

Responsibility for the  Consolidated Financial Statements                F-2
Reports of Independent Accountants:
    Deloitte & Touche LLP                                                F-3
    Price Waterhouse LLP                                                 F-4
Consolidated Balance Sheets as of December 31, 1997 and 1996             F-5
Consolidated Statements of Operations for the Four Months Ended 
  December 31, 1997, the Eight Months Ended August 31, 1997, and the 
  Years Ended December 31, 1996 and 1995                                 F-6
Consolidated Statements of Stockholders' Equity for the Four
  Months Ended December 31, 1997, the Eight Months Ended
  August 31, 1997, and the Years Ended December 31, 1996 and 
  1995                                                                   F-7 
Consolidated Statements of Cash Flows
  for the Four Months Ended December 31, 1997, the
  Eight Months Ended August 31, 1997 and the Years
  Ended December 31, 1996 and 1995                                       F-8
Notes to the Consolidated Financial Statements                           F-10


All Financial Statement Schedules have been omitted because (i) the
required information is not present in amounts sufficient to require
submission of the schedule, (ii) the information required is included in
the Consolidated Financial Statements or the Notes thereto or (iii) the
information required in the schedules is not applicable to the Company.


RESPONSIBILITY FOR THE CONSOLIDATED FINANCIAL STATEMENTS

            Company management is responsible for the preparation, accuracy
and integrity of the consolidated financial statements and other financial
information included in this Annual Report. This responsibility includes
preparing the statements in accordance with generally accepted accounting
principals and necessarily includes estimates that are based on
management's best judgment.

            To help ensure the accuracy and integrity of company financial
data, management maintains internal controls which are designed to provide
reasonable assurance that transactions are executed as authorized, that
they are accurately recorded and that assets are properly safeguarded. It
is essential for all Company employees to conduct their business affairs in
keeping with the highest ethical standards as outlined in our code of
conduct policy, "Business Conduct Guidelines". Careful selection of
employees, and appropriate divisions of responsibility, also help us to
achieve our control objectives.

            The 1997 financial statements have been audited by the
Company's independent accountants, Deloitte & Touche LLP. The 1996 and 1995
consolidated financial statements of Rexene have been previously audited by
Rexene's auditors Price Waterhouse LLP. Their reports are shown on pages
F-3 and F-4, respectively.

            The Board of Directors oversees the adequacy of the Company's
control environment. The audit Committee meets periodically with
representatives of Deloitte & Touche LLP, internal financial management and
internal auditors to review accounting, control, auditing and financial
reporting matters. The independent accountants and the internal auditors
also have full and free access to meet privately with the Committee.



                     REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors of Huntsman Polymers Corporation:

            We have audited the accompanying consolidated balance sheet of
Huntsman Polymers Corporation and its subsidiaries (the "Company"),
formally Rexene Corporation (the "Predecessor Company"), as of December 31,
1997, and the related statements of operations, stockholders' equity and
cash flows for the four months ended December 31, 1997 and for the eight
months ended August 31, 1997 (Predecessor Company operations). These
financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements
based on our audits.

            We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform the
audits to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes assessing
the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation. We believe our audits provide a reasonable basis for our
opinion.

            In our opinion, the financial statements referred to above
present fairly, in all material respects, the financial position of
Huntsman Polymers Corporation as of December 31, 1997, and the results of
its operations and cash flows for the four months ended December 31, 1997,
and the results of the Predecessor Company operations and cash flows for
the eight months ended August 31, 1997, in conformity with generally
accepted accounting principles.

            As discussed in Note 2, during 1997 the Company sold its CT
Film business. We have audited the adjustments that were applied to restate
the 1996 and 1995 financial statements. In our opinion, such adjustments
are appropriate and have been properly applied to the 1996 and 1995
financial statements.


/s/  DELOITTE & TOUCHE LLP


DELOITTE & TOUCHE LLP

Houston, Texas
March 30, 1997


                     REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and Stockholders of
Rexene Corporation

            In our opinion, the consolidated balance sheet and the related
consolidated statements of operations and stockholders' equity and of cash
flows, prior to the reclassification as described in Note 2 to reflect the
sale of the CT Business as discontinued operations (not presented
separately herein), present fairly, in all material respects, the financial
position, results of operations and cash flows of Rexene Corporation and
its subsidiaries (the "Predecessor Company") as of and for each of the two
years in the period ended December 31, 1996, in conformity with generally
accepted accounting principles. These financial statements are the
responsibility of the Company's management; our responsibility is to
express an opinion on these financial statements based on our audits. We
conducted our audits of these statements in accordance with generally
accepted auditing standards which require that we plan and perform the
audits to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the
financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for the opinion expressed above. We have not audited the
consolidated financial statements of Rexene Corporation and its
subsidiaries (the "Predecessor Company") for any period subsequent to
December 31, 1996 nor have we examined any adjustments applied to the 1996
and 1995 financial statements.



PRICE WATERHOUSE LLP


Dallas, Texas
February 12, 1997, except as to Note 9, 
  for which the date is March 14,
  1997 and except for the SFAS 130 
  disclosure in Note 2 for which the date
  is March 30, 1998.

<TABLE>
<CAPTION>

               HUNTSMAN POLYMERS CORPORATION AND SUBSIDIARIES
                        CONSOLIDATED BALANCE SHEETS
                               (IN THOUSANDS)

                                                                                                 Predecessor Company
                                                                          December 31, 1997        December 31, 1996
                                                                          -----------------        -----------------
                                    ASSETS
                                    ------

Current assets:

<S>                                                                      <C>                       <C>             
            Cash and cash equivalents                                    $               --        $            714
            Accounts and notes receivables, net                                      21,900                  64,637
            Accounts and advances receivable - Affiliates                            78,396                      --
            Inventories                                                              57,443                  52,294
            Net assets of discontinued operations                                        --                 106,051
            Deferred income taxes                                                     5,543                   2,816
                                                                                     20,062                      39
            Other current assets                                         ------------------        ----------------
               Total current assets                                                 183,344                 226,551
Properties, plant and equipment, net                                                727,418                 297,334
Intangible assets, net                                                                8,446                  15,570
                                                                                     23,915                  28,075
Other noncurrent assets                                                  -------------------       ----------------

            Total assets                                                 $          943,123        $        567,530
              LIABILITIES AND STOCKHOLDERS' EQUITY                       -------------------       ----------------
              ------------------------------------
Current liabilities:

            Accounts payable                                             $           52,740        $         45,498
            Accounts payable - Affiliates                                             6,404                      --
            Accrued liabilities                                                      15,080                   9,289
            Current income taxes payable                                                 --                     594
            Accrued interest                                                          1,723                   1,889
                                                                                      4,136                   6,823
            Employee benefits payable                                    -------------------       ----------------
                                                                                     80,083                  64,093
               Total current liabilities                                 -------------------       ----------------
Long-term debt                                                                      174,882                 235,000
Long-term debt - Affiliates                                                         309,590                      --
Deferred income taxes                                                               166,219                  39,986
                                                                                     46,550                  59,400
Other noncurrent liabilities                                             -------------------       ----------------
Commitments and contingencies, (see note 11)

               Total liabilities                                                    774,324                 398,479
                                                                         -------------------       ----------------
Stockholders' equity:
           Common Stock, par value $.01 per share; in 1997,
             1 million shares authorized and 1,000 issued and
             outstanding; in 1996, 100 million shares authorized
             and 18.8 million shares issued and outstanding                              --                     188

            Additional paid-in capital                                              173,500                 111,553
            Foreign currency translation adjustment                                      --                   1,990

            Retained earnings (deficit)                                              (4,701)                 55,320
                                                                         -------------------       ----------------
               Total stockholders' equity                                           168,799                 169,051
                                                                         -------------------       ----------------

               Total liabilities and stockholders' equity                $          943,123        $        567,530
                                                                         -------------------       ----------------

                                      See accompanying notes to financial statements

</TABLE>


<TABLE>
<CAPTION>
                                         HUNTSMAN POLYMERS CORPORATION AND SUBSIDIARIES

                                              CONSOLIDATED STATEMENTS OF OPERATIONS

                                                         (IN THOUSANDS)

                                                                                           PREDECESSOR COMPANY
                                                                          -----------------------------------------------

                                                      FOUR MONTHS         EIGHT MONTHS
                                                         ENDED                ENDED           YEAR ENDED       YEAR ENDED
                                                      DECEMBER 31,         AUGUST 31,        DECEMBER 31,     DECEMBER 31,
                                                          1997                1997               1996            1995
                                                          ----                ----               ----            ----
Revenues

<S>                                                 <C>                   <C>               <C>               <C>        
  Trade sales and services                          $    66,564           $   307,603       $   435,297       $   444,713

  Affiliate sales                                        72,169                     -                 -                 -
                                                            942                     -                 -                 -
  Other revenues                                    -----------           -----------       -----------       -----------
                                                        139,675               307,603           435,297           444,713


Cost of goods sold                                      126,914               250,887           330,667           282,585
                                                    -----------           -----------       -----------       -----------
Gross Profit                                             12,761                56,716           104,630           162,128
Expenses

  Selling, general and administrative                     6,645                19,567            35,369            35,704
  Research and development                                2,654                 3,509             6,006             5,773
                                                              -                (9,000)                -                 -
  Reversal of environmental accrual                 -----------           -----------       -----------       -----------
Operating Income                                          3,462                42,640            63,255           120,651
Interest expense

  Affiliate interest expense                             (7,568)

  Other interest expense                                 (3,353)              (15,163)          (14,407)          (22,769)
Interest income                                           1,098                 1,273             1,778             3,220

Defense and Merger Costs                                      -                (8,500)           (1,247)                -

Other expense                                              (226)              (13,447)             (486)             (174)
                                                    -----------           -----------       -----------       -----------
Net income (loss) from continuing
   operations before income taxes                        (6,587)                6,803            48,893           100,928
                                                    -----------           -----------       -----------       -----------
Income tax benefit (expense)                        
Net income (loss) from continuing operations             (4,483)                3,155            30,444            63,466

Loss (income) from discontinued operations
   (net of income tax benefits, ($55), ($673),
   ($351) and tax expense of $974, respectively)            218                 2,692               713            (1,977)
                                                    -----------           -----------       -----------       -----------
Net income (loss) before extraordinary loss              (4,701)                  463            29,731            65,443
Extraordinary loss (net of income tax benefit,
($424))                                                       -                   694                 -                 -
                                                    -----------           -----------       -----------       -----------
Net income (loss)                                   $    (4,701)          $      (231)      $    29,731       $    65,443
                                                    ===========           ===========       ===========       ===========

                                   See accompanying notes to financial statements

</TABLE>


<TABLE>
<CAPTION>

               HUNTSMAN POLYMERS CORPORATION AND SUBSIDIARIES
              CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

                               (IN THOUSANDS)

                                                                                                           FOREIGN
                                                                                             RETAINED     CURRENCY
                                                     COMMON STOCK     TREASURY   PAID-IN     EARNINGS    TRANSLATION
PREDECESSOR COMPANY:                              SHARES    AMOUNT     STOCK    CAPITAL     (DEFICIT)    ADJUSTMENT       TOTAL
                                                  ------    ------     -----    -------      -------     ----------       -----
<S>               <C> <C>                         <C>         <C>     <C>      <C>         <C>              <C>          <C>     
Balance, December 31, 1994                        18,625      186        -     $ 110,355   $ (36,098)       $   433      $ 74,876
 Issuance of common stock                            120        1        -           365            -              -          366
 Tax benefit of directors' and employees'
   compensation deduction                              -        -        -           527            -              -          527
 Foreign currency translation adjustment
   (discontinued operations)                           -        -        -             -            -          (311)         (311)
 Dividends of common stock ($.04 per share)            -        -        -             -        (750)              -         (750)
                                                                                         
 Net income                                    ---------    -----     ------   ---------   ----------       --------      -------
Balance, December 31, 1995                        18,745      187        -       111,247       28,595            122       140,151
 Issuance of common stock                             63        1        -           240            -              -          241
Tax benefit of directors' and employees'
   compensation deduction                              -        -        -            66            -              -           66
 Foreign currency translation adjustment
   (discontinued operations)                           -        -        -             -            -          1,868        1,868
 Dividends of common stock ($.16 per share)            -        -        -             -      (3,006)              -       (3,006)

 Net income                                            -        -        -             -       29,731              -       29,731
                                               ---------    -----     ------   ---------   ----------       --------      -------
Balance, December 31, 1996                        18,808      188        -       111,553       55,320          1,990      169,051
 Issuance of common stock                             52        1        -           334            -              -          335
 Repurchase of common stock                         (12)      (1)       12          (83)            -              -          (72)
 Foreign currency translation adjustment
   (discontinued operations)                           -        -        -             -            -        (1,140)       (1,140)
 Dividends of common stock ($.08 per share)            -        -        -             -      (1,507)              -       (1,507)
                                                                                         
 Net loss                                              -        -        -             -        (231)              -         (231)
                                               ---------    -----     ------   ---------   ----------       --------      -------
Balance at August 31, 1997                        18,848      188       12       111,804       53,582            850      166,436
----------------------------------------------------------------------------------------------------------------------------------
POST MERGER:

 Purchase accounting adjustments                 (18,848)    (188)     (12)       61,696      (53,582)          (850)       7,064
                                                                                         
 Net loss                                              -        -        -             -       (4,701)             -       (4,701)
                                               ---------    -----     ------   ---------   ----------       --------      -------
Balance, December 31, 1997                             -        -        -     $  173,500    $ (4,701)             -     $168,799
                                               ---------    -----     ------   ---------   ----------       --------      -------
                                               See accompanying notes to financial statements

</TABLE>


<TABLE>
<CAPTION>

                                                       HUNTSMAN POLYMERS CORPORATION AND SUBSIDIARIES
                                                            CONSOLIDATED STATEMENTS OF CASHFLOWS

                                                                       (IN THOUSANDS)

                                                                                              PREDECESSOR COMPANY
                                                                                  -----------------------------------------
                                                                     FOUR MONTHS  EIGHT MONTHS
                                                                         ENDED       ENDED        YEAR ENDED    YEAR ENDED
                                                                     DECEMBER 31,  AUGUST 31,    DECEMBER 31,  DECEMBER 31,
                                                                         1997         1997           1996          1995
                                                                         ----         ----           ----          ----
OPERATING ACTIVITIES:

<S>                                                                   <C>          <C>           <C>           <C>      
Net income (loss)                                                     $  (4,701)   $    (231)    $  29,731     $  65,443
Reconciliation to net cash provided by continuing operations:
 Loss (Income) from discontinued operations                                 218        2,692           713        (1,977)
 Depreciation and amortization                                           14,570       14,808        16,886        14,795
 Deferred income taxes                                                    5,003       (2,160)        2,101         4,194
 Amortization of debt issuance costs                                        264        1,130         1,297         2,876
 Extraordinary loss, net of income taxes                                      -          694             -             -
 Changes in operating working capital (net of merger):

  Deposits held in trust                                                      -                      3,547          4,453
   Accounts receivable                                                   12,067        1,303       (14,525)        11,569
   Inventories                                                           (7,703)       2,554        (9,294)          (621)
   Other current assets                                                 (20,039)          17           292            399
   Accounts payable                                                      21,531       (7,884)       21,610         (6,864)
   Accrued interest                                                      (3,418)       3,252           175           (180)
   Employee benefits payable and accrued liabilities                    (18,858)      13,340          (751)         1,205
   Income taxes                                                          (4,254)       3,660       (30,118)        32,952
   Other noncurrent liabilities                                         (15,153)      (9,191)         (649)        (2,492)
                                                                  
   Other                                                                  9,050      (20,795)       (5,166)           354
                                                                       --------    ---------     ---------      ---------      
   Net cash provided by (used in) continuing operations                 (11,423)       3,189        15,849        126,106
                                                                  
Net cash provided by (used in) discontinued operations                        -       (5,565)        2,360          6,370
                                                                       --------     ---------     ---------      ---------      
                                                                  
   Net cash provided by (used in) operating operations                  (11,423)      (2,376)       18,209        132,476
                                                                       --------     ---------     ---------      ---------      
INVESTING ACTIVITIES:

 Advances receivable - affiliates                                       (49,029)
 Acquisition of Rexene                                                 (308,369)

 Capital expenditures of continuing operations                          (43,859)     (72,063)     (105,914)       (41,918)
 Capital expenditures of discontinued operations                           (147)      (3,312)       (7,878)       (12,688)
 Proceeds from sale of discontinued operations                           70,000
      
Purchase of intangibles                                                       -       (1,271)            -              -
                                                                       --------     ---------     ---------      ---------
                                                                 
  Net cash used in investing activities                                (331,404)     (76,646)     (113,792)       (54,606)
                                                                       --------     ---------     ---------      ---------


</TABLE>

<TABLE>
<CAPTION>


                                                                                            PREDECESSOR COMPANY
                                                                              --------------------------------------------
                                                              FOUR MONTHS     EIGHT MONTHS
                                                                 ENDED           ENDED          YEAR ENDED     YEAR ENDED
                                                             DECEMBER 31,      AUGUST 31,      DECEMBER 31,   DECEMBER 31,
                                                                 1997             1997             1996           1995
                                                                 ----             ----             ----           ----
FINANCING ACTIVITIES:

<S>                                                            <C>              <C>             <C>           <C>           
 Issuance of common stock to parent                            173,500
 Intercompany borrowing from parent                            269,525
 Long term borrowings                                                -           83,916
 Repayment of long-term debt                                  (100,198)                                        (100,000)
 Bank borrowing, net of repayment                                    -                           60,000
 Debt issuance costs and other                                       -           (3,182)         (4,598)
 Advance payment from customer, net of repayments                    -                -          (3,600)         23,200
 Cash dividends paid                                                 -           (2,259)         (3,004)
 Repurchase of common stock                                          -             (166)
                                                          
 Proceeds of issuance of common stock, net                           -              251             241             366
                                                             ---------        ---------       ---------       ---------
                                                          
  Net cash provided by financing activities                    342,827           78,560          49,039         (76,434)
                                                             ---------        ---------       ---------       ---------
Increase (Decrease) in Cash and Cash Equivalents                     -             (462)        (46,544)          1,436
Cash and Cash Equivalents at Beginning of Period                     -              714          47,258          45,822
Cash and Cash Equivalents at Beginning of Period          
   for Discontinued Operations                                       -             (252)              -               -
                                                             ---------        ---------       ---------       ---------
                                                          
Cash and Cash Equivalents at End of Period                            
Supplemental Cash Flow information:
  Cash paid for interest                                        10,274           16,160          21,951          23,740
  Cash paid for income taxes                                     3,222            1,064          46,551           1,933
                                                      See accompanying notes to financial statements.

</TABLE>



               HUNTSMAN POLYMERS CORPORATION AND SUBSIDIARIES
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.      MERGER

            Effective September 1, 1997 (the "Effective Date") for
financial accounting purposes, pursuant to an Agreement and Plan of Merger
(the "Merger Agreement") by and among Rexene Corporation ("Rexene" or the
"Predecessor Company"), Huntsman Corporation ("HC") and Huntsman Centennial
Corporation ("HCC"), a wholly-owned indirect subsidiary of HC, HCC was
merged with and into Rexene, and Rexene changed its name to Huntsman
Polymers Corporation (the "Company"). Pursuant to the merger, stockholders
of Rexene received from HCC $16.00 in cash for each outstanding share of
common stock of Rexene (the "Merger"). As a result of the Merger, HC
indirectly owns all of the presently issued common stock of the Company.
The accounting treatment of the cash consideration paid by HCC in
connection with the Merger is shown under push-down accounting rules.

            To finance the Merger, HCC entered into a loan agreement with
an affiliate, Huntsman Group Holding Finance Company ("HGHFC"). HCC
borrowed approximately $131.1 million under this loan agreement.
Additionally, HCC received an equity contribution from its parent company,
Huntsman Polymers Holding Corporation ("HPHC"), in the amount of $173.5
million. After the Merger, the Company entered into a loan agreement with
HGHFC, and borrowed $225.1 million (the "Intercompany Loan"). The proceeds
of this borrowing were used to repay debt of HCC assumed by the Company in
the Merger and bank debt of Rexene.

            The Merger closed on August 27, 1997.

            The sources and applications of funds required to consummate
the Merger are summarized below in thousands of dollars.

      Sources of Funds:

              Loan agreement with HGHFC             $              225,067
              Equity Contribution                                  173,500
              Rexene Working Capital                                 3,382
                                                    ----------------------
                      Total                         $              401,949
                                                    ======================
Uses of Funds:

              Payment of the Merger

                      Consideration                 $              301,614
              Liquidation of Rexene debt                           100,080
              Transaction fees and expenses(1)                         255
                                                    ----------------------
                      Total                         $              401,949
                                                    ======================

------------------------------

(1)         Transaction fees and expenses totaled $6.8 million, of
which $255 thousand was paid on August 27, 1997. The remainder were paid
using funds provided by operations.

            The Merger has been accounted for as a purchase transaction,
and accordingly, the consolidated financial statements subsequent to the
Effective Date reflect the purchase price, including transaction costs and
liabilities assumed based on their estimated fair values as of the
Effective Date. Although none of the purchase price has been allocated to
intangible assets, valuation and other studies have not been finalized. It
is not expected that the final allocation of purchase price will produce
materially different results from those presented herein. The combined
financial statements for periods prior to September 1, 1997 have been
prepared on a historical cost basis. The consolidated balance sheet at
December 31, 1997 is not comparable with the historical balance sheet at
December 31, 1996. Operating results subsequent to the Merger are
comparable to the operating results prior to the Merger except for
depreciation expense, amortization of intangible assets, pensions, and
interest expense. In addition, Rexene's pre-Merger common stock was
canceled and replaced with 1,000 shares of common stock (all of which are
owned by HPHC), rendering the presentation of per share data no longer
meaningful.

            The allocation of the $308 million Merger consideration
(including fees and expenses) is summarized as follows in thousands of
dollars:

Current assets                $   95,569
CT Business                       70,000
Plant and equipment              701,697
Other non-current assets          40,254
Liabilities assumed             (599,131)
                              ----------
              Total           $  308,389
                              ==========

            The following unaudited pro forma data has been prepared
assuming that the Merger and related financing and the sale of the CT
Business were consummated at the beginning of each period. Amounts are in
thousands of dollars.

                                                   Year Ended December 31,
                                                   1997              1996
                                                   ----              ----
Revenues                                         $447,278         $435,297
Net income (loss) before extraordinary item       (8,095)           10,515
Net income (loss)                                 (8,789)           10,515


2.            SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

            The Company manufactures products used in a wide variety of
industrial and consumer-related applications. The Company's principal
products are polyethylene, polypropylene, amorphous polyalphaolefins
("APAO"), flexible polyolefin ("FPO") and styrene.

USE OF ESTIMATES

            The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from
those estimates.

PRINCIPLES OF CONSOLIDATION

            The consolidated financial statements of the Company and the
Predecessor Company include its wholly-owned subsidiaries. Intercompany
transactions and balances are eliminated.

DISCONTINUED OPERATIONS

            As discussed more fully in Note 16, the Company sold its CT
Business effective September 30, 1997. The results of operations for the CT
Business have been reclassified as discontinued operations for all periods
presented in the Consolidated Statements of Operations. Revenues of the CT
Business were $16,278 thousand, $107,221 thousand, $152,464 thousand and
$170,525 thousand for the four months ended December 31, 1997, eight months
ended August 31, 1997 and years ended December 31, 1996 and 1995,
respectively. The assets and liabilities of the CT Business have been
reclassified in the December 31, 1996 consolidated balance sheet as "Net
Assets of Discontinued Operations."

CASH AND CASH EQUIVALENTS

            Highly liquid investments with an original maturity of three
months or less when purchased are considered to be cash equivalents.

INVENTORIES

            Inventories are stated at the lower of cost or market using the
first-in, first-out method.

PROPERTY, PLANT AND EQUIPMENT

            Property, plant and equipment is stated at cost. Depreciation
is provided utilizing the straight line method over the estimated useful
lives of the assets, ranging from 3 to 20 years. Improvements are
capitalized, while repair and maintenance costs are charged to operations
as incurred. Interest costs are capitalized as part of major construction
projects. Upon disposal of assets, the cost and related accumulated
depreciation are removed from the accounts and resulting gain or loss is
included in income.

INTANGIBLE ASSETS

            Debt issuance costs are amortized over the term of the related
debt, ranging from five to ten years. Other intangible assets are stated at
their fair market values at the time of the Merger and are amortized using
the straight-line method over their estimated useful lives of five to
fifteen years or over the life of the related agreement and are included in
"Other assets."

INCOME TAXES

            Deferred income taxes are provided for temporary differences
between financial statement income and taxable income using the asset and
liability method in accordance with Statement of Financial Accounting
Standards No. 109, "Accounting for Income Taxes."

FOREIGN CURRENCY TRANSLATION

            The Company's foreign subsidiary was sold effective September
30, 1997 in conjunction with the CT Film sale transaction described in Note
16. Prior to the sale, the operations of the Company's foreign subsidiary
used the local currency of the country of operation as the functional
currency. The financial statements of the foreign subsidiary were
translated at the current and average exchange rates, with any resulting
translation adjustments included in the foreign currency translation
adjustment account in owners' equity.

ENVIRONMENTAL EXPENDITURES

            Environmental related restoration and remediation costs are
recorded as liabilities and expensed when site restoration and
environmental remediation and clean-up obligations are either known or
considered probable and the related costs can be reasonably estimated.
Other environmental expenditures, which are principally maintenance or
preventative in nature, are recorded when expended and are expensed or
capitalized as appropriate.

FAIR VALUE OF FINANCIAL INSTRUMENTS

            The carrying amount reported in the balance sheets for cash and
cash equivalents, accounts receivable, and accounts payable approximates
fair value because of the immediate or short-term maturity of these
financial instruments. The carrying value of the related party loans,
capital lease, and bank borrowings approximates fair value as they bear
interest at a floating rate plus an applicable margin. At December 31, 1997
and 1996, the fair value of the $175 million principal amount 11 3/4%
Senior Notes was approximately $196 million and $194 million, respectively,
based on quoted market rates.

RECLASSIFICATIONS

            Certain amounts in the consolidated financial statements for
prior periods have been reclassified to conform with the current
presentation.

NEW ACCOUNTING STANDARDS

            In June 1997, the Financial Accounting Standards Board ("FASB")
issued Statement of Financial Accounting Standards ("SFAS") No. 130,
"Reporting Comprehensive Income", which establishes standards for reporting
and display of comprehensive income and its components. SFAS No. 130 is
effective for fiscal years beginning after December 15, 1997 and requires
classification of financial statements in earlier periods for comparative
purposes. If the Company had calculated comprehensive income in accordance
with SFAS No. 130, Comprehensive income (loss) for the four months ended
December 31, 1997, the eight months ended, August 31, 1997, and the years
ended December 31, 1996 and 1995 would have been $(4.7) million, $(1.4)
million, $31.6 million and $65.1 million, respectively. The Company has
determined the amounts of comprehensive income for 1996 and 1995.

            In June 1997, the FASB issued SFAS No. 131, "Disclosures About
Segments of an Enterprise and Related Information", which establishes
standards for the way that public business enterprises report information
about operating segments in interim and annual financial statements. SFAS
No. 131 is effective for fiscal years beginning after December 15, 1997 and
requires comparative information for earlier years to be restated. Upon
adoption of SFAS No. 131, the Company will provide segment information
related to the Company' individual products and related disclosures.

INCOME (LOSS) PER SHARE

            Income (loss) per share is not presented because it is not
considered meaningful information due to the acquisition by a single
non-public shareholder.

3.            ACCOUNTS RECEIVABLE

Accounts receivable consist of the following (in thousands):

                                                          Predecessor Company
                                       December 31, 1997   December 31, 1996
                                       -----------------  -------------------
Trade                                        $   9,889      $  55,853
                                                
Other                                           13,695         11,030
                                       -----------------  -------------------
                                                23,584         66,883
Less allowances for bad debts
  and returns                                   (1,684)        (2,246)
                                       -----------------  -------------------
                                                21,900         64,637
Affiliate-receivables and advances              78,396              -
                                       -----------------  -------------------
                                             $ 100,296        $64,637
                                       -----------------  -------------------


            Net additions to (deductions from) the allowance accounts were
$(742,000), $180,000, $141,000 and $219,000 for the four months ended
December 31, 1997, the eight months ended August 31, 1997, and the years
ended December 31, 1996 and 1995, respectively.

4.             INVENTORIES

Inventories consist of the following (in thousands):

                                             Predecessor Company
                          December 31, 1997   December 31, 1996
                          -----------------  -------------------
Raw Materials              $     11,297          $   11,085
Work in progress                  7,952          $    8,134
Finished goods             $     38,194          $   33,075
                          -----------------  -------------------
                           $     57,443          $   52,294
                          -----------------  -------------------
                            

5.            PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment consists of the following (in thousands):

                                             Predecessor Company
                          December 31, 1997   December 31, 1996
                          -----------------  -------------------
Land                                 $4,487           $4,544
Buildings                            23,249           21,940
Plant and equipment                 542,834          267,207
Construction in progress            171,384           59,835
                          -----------------  -------------------
                                    741,954          353,526
Less accumulated
  depreciation                      (14,536)         (56,192)
                          -----------------  -------------------

                                  $ 727,418        $ 297,334
                          -----------------  -------------------


            Depreciation expense for the four months ended December 31,
1997, the eight months ended August 31, 1997 and the years ended December
31, 1996 and 1995 was $14,332,000, $10,075,000, $15,246,000 and
$13,350,000, respectively. During the four months ended December 31, 1997
the eight months ended August 31, 1997 and the years ended December 31,
1996 and 1995, $4,212,000, $5,333,000, $8,259,000 and $2,577,000,
respectively, of interest was capitalized in connection with construction
projects, substantially all of which relates to continuing operations.

6.            INTANGIBLE ASSETS

Intangible assets, net of accumulated amortization are (in thousands):
                                                  Predecessor Company
                               December 31, 1997   December 31, 1996
                               -----------------  -------------------
Debt issuance costs                 $  7,173            $ 14,333
Less accumulated
  amortization                        (1,821)             (4,288)
                               -----------------  -------------------
                                       5,352              10,045
                               -----------------  -------------------
Reorganization value in 
  excess of amounts
  allocable to identifiable assets                         4,298

Less accumulated amortization                             (1,437)
                               -----------------  -------------------
                                           -               2,861
                               -----------------  -------------------
Other intangible assets                3,105               7,377
Less accumulated amortization            (11)             (4,713)
                               -----------------  -------------------
                                       3,094               2,664
                               -----------------  -------------------
                                     $ 8,446             $15,570
                               -----------------  -------------------


7.            OTHER NONCURRENT ASSETS

Other noncurrent assets consist of the following (in thousands):

                                                          Predecessor Company
                                        December 31, 1997   December 31, 1996
                                       -----------------  -------------------

Spare parts inventory                      $  20,432            $  16,945
Unrecognized prior service cost, net of
accumulated amortization of 741 in 1996         -                   2,022
Deposit in rabbi trust                          -                   2,856
Long-term note receivable                      1,198                1,550

Other                                          2,285                4,702
                                       -----------------  -------------------

                                           $  23,915            $  28,075
                                       -----------------  -------------------


            Spare parts inventories are recorded at average cost. In 1995,
the Predecessor Company deposited $2.8 million in a rabbi trust account to
fund a Supplemental Executive Retirement Plan (the "SERP). In 1996, no
amounts were deposited in the rabbi trust account to fund the SERP. In
1997, the Predecessor Company deposited $3.7 million into the rabbi trust
account to fund the SERP and purchased annuities resulting in the
elimination of the balance sheet liability.

8.            ACCRUED LIABILITIES

Accrued liabilities consist of the following (in thousands):

                                                          Predecessor Company
                                        December 31, 1997   December 31, 1996
                                       -----------------  -------------------
Accrued taxes, other than income         $  5,506               $  2,757
Current portion of advance payment
  from customer (see note 10)               3,600                  3,600

Other accrued expenses                      5,974                  2,932
                                       -----------------  -------------------
                                         $ 15,080               $  9,289
                                       -----------------  -------------------

9.            LONG-TERM DEBT

Long-term debt consists of the following (in thousands):
                                                          Predecessor Company
                                        December 31, 1997   December 31, 1996
                                       -----------------  -------------------
Intercompany borrowings                    $258,055           $      -
Capital lease - affiliate                    50,000                  -
Bank borrowings under Amended Credit
   Agreement                                      -             60,000
11 3/4% Senior Notes due 2004               174,882            175,000
Other                                         1,535                  -
                                       -----------------  -------------------
Total long-term debt                       $484,472           $235,000
                                       -----------------  -------------------

INTERCOMPANY BORROWINGS

            Intercompany loans are made pursuant to the Huntsman Polymers
Intercompany Loan Agreement dated August 27, 1997 between HGHFC and
Huntsman Polymers Corporation. The loans accrue interest at prime rate plus
a margin of 0.75% and are payable upon demand. Management of HGHFC has
represented that HGHFC does not intend to require the Company to repay the
debt before January 1, 2002, accordingly, such amounts have been classified
as long-term. To the extent permitted by the indenture governing the
Company's 11 3/4% Senior Notes, the intercompany loans are secured by all
of the assets of the Company.

CAPITAL LEASE

            On March 8, 1997, the Company entered into a Capital Lease
Agreement with the Estherwood Corporation to finance the construction of
the Company's FPO facility in Odessa, Texas. On August 27, 1997, the
agreement was amended and Estherwood Corporation assigned all of its rights
under the agreement to HGHFC. The principal economic terms of the lease
agreement were not altered. The Company is obligated to make quarterly
lease payments through September 30, 2002. The lease is secured by all of
the fixed assets associated with the FPO facility.

            The Company's long-term capital lease as of December 31, 1997
maturities are as follows (in thousands):

For the years ending December 31,

    1998        $      -
    1999             3,125
    2000            13,750
    2001            18,125
    2002            15,000
                    ------
                $   50,000


AMENDED AND RESTATED CREDIT AGREEMENT

            On April 24, 1996, the Predecessor Company executed an
amendment to its existing credit facility (the "Amended Credit Agreement")
to provide a line of credit in the amount of $150 million for a seven year
term. On August 5, 1996, the Predecessor Company executed an agreement with
a financial institution for a $10 million uncommitted, unsecured line or
credit (the "Unsecured Note") for day to day cash flow requirements. The
Unsecured Note agreement was canceled in August 1997.

            On March 14, 1997, the Predecessor Company received a
commitment from Scotia Bank to increase the borrowing availability under
the amended Credit Agreement from $150 million to $225 million through $150
million in term loans and $75 million in a revolving credit facility (the
"New Credit Agreement'). The primary use of the proceeds from the New
Credit Agreement were to provide funds to repurchase the Company's Common
Stock pursuant to the Share Repurchase Program and to finance portions of
the Company's capital expenditure program at its Odessa, Texas plant. The
Amended Credit Agreement was terminated and all amounts borrowed thereunder
were repaid in August 1997.

SENIOR NOTES

            The 11 3/4% Senior Notes rank pari passu in right of payment
with all senior unsecured borrowings of the company, including a portion of
the borrowings under the intercompany loan agreement. The 11 3/4% Senior
Notes rank senior in right of payment to any subordinated indebtedness of
the Company. Interest is payable on the 11 3/4% Senior Notes semiannually
on June 1 and December 1 at an annual interest rate of 11 3/4%. The Company
is not required to make mandatory redemption or sinking fund payments with
respect to the 11 3/4% Senior Notes.

            The 11 3/4% Senior Notes are not redeemable, in whole or in
part, prior to December 1, 1999. On or after December 1, 1999, the 11 3/4%
Senior Notes are redeemable, at the Company's option, in whole or in part,
at the redemption prices (expressed as percentages of principal amount) set
forth below plus accrued and unpaid interest, if any, to date of
redemption.

Year                                                    Percentage
----                                                    ----------
(Beginning December 1)
1999.....................................................105.875%
2000.....................................................103.917%
2001.....................................................101.958%
2002.....................................................100.000%

            The indenture governing the 11 3/4% Senior Notes contains
certain covenants that, among other things, limit the ability of the
Company to incur additional indebtedness and to repurchase subordinated
indebtedness, incur or suffer to exist certain liens, pay dividends, make
certain investments, sell significant fixed assets and engage in mergers
and consolidations.


10.         OTHER NONCURRENT LIABILITIES

Other noncurrent liabilities consist of the following (in thousands):
                                                          Predecessor Company
                                        December 31, 1997   December 31, 1996
                                       -----------------  -------------------
Accrued environmental remediation
  costs (see note 17)                      $ 8,535              $18,433
Advance payment from customer               12,400               16,000
Accumulated postretirement benefit
  obligation (see note 15)                  11,922               13,469
Pension liabilities (see note 15)            4,695                7,927
Other                                        5,998                3,571
                                       -----------------  -------------------
                                           $43,550              $59,400
                                       -----------------  -------------------


            In July 1995, the Predecessor Company received a $25 million
advance payment from a customer as a result of a multi-year agreement to
supply a portion of annual styrene production. The unamortized portion of
this advance payment net of current portion, is included as a noncurrent
liability above. This advance payment is secured by a lien on the styrene
plant in Odessa, Texas.

11.         COMMITMENTS

            The future payments of rentals on buildings, computers, office
equipment and transportation equipment under the terms of non-cancelable
operating lease agreements as of December 31, 1997 are as follows (in
thousands):

For the years ending December 31,

               1998                                    $  10,201
               1999                                        9,572
               2000                                        8,296
               2001                                        6,289
               2002                                        3,600
               2003 and thereafter                        26,104
                                                       ---------

Total minimum lease payments                           $  64,062
                                                       ---------

            Rental expense under operating leases for the years ended
December 31, 1997, 1996 and 1995 approximated $7,903,574, $8,699,000 and
$8,902,000, respectively, substantially all of which relates to continuing
operations.

            In 1998, the Company expects to spend $200 million to $225
million for capital expenditures.


12.          INCOME TAX

            Income tax (expense) benefit on the Company's income from
continuing operations before extraordinary loss consists of the following
(in thousands):

<TABLE>
<CAPTION>
                                                             Predecessor Company
                                             ----------------------------------------------------
                     Four Months Ended       Eight Months Ended
                     December 31, 1997       August 31, 1997           Years Ended  December 31,
                     -----------------       -------------------     ----------------------------
                                                                         1996             1995
                                                                     ------------   -------------
                                                                    Current

<S>                        <C>                       <C>              <C>                <C>      
  Federal........          $3,518                    $7,892           $(14,324)          $(30,376)
  State..........             544                     1,088             (2,024)            (2,892)
Deferred.........          (1,958)                  (12,628)            (2,101)            (4,194)
                   -------------------       -------------------    -------------   --------------
                           $2,104                   $(3,648)          $(18,449)          $(37,462)
                   ===================       ===================    =============   ==============
</TABLE>

            In addition, for the eight months ended August 31, 1997, the
Company recorded an income tax benefit of $424,000 as a result of the
extraordinary loss from the write-off of certain deferred issuance costs as
a result of the May 8, 1997 amendment to the Credit Agreement.

            The statutory federal income tax rate was 35% for the years
ended December 31, 1997, 1996 and 1995. The effective income tax rate
differs from the amount computed by applying the statutory federal income
tax rate to the Company's income (loss) from continuing operations before
income taxes and extraordinary loss. The reasons for these differences are
as follows (in thousands):

<TABLE>
<CAPTION>
                                                                                         Predecessor Company
                                                                           --------------------------------------------
                                                   Four Months Ended       Eight Months Ended
                                                   December 31, 1997        August 31, 1997    Years Ended  December 31,
                                                   -----------------       ------------------  ------------------------
                                                                                                   1996            1995
                                                                                                ---------     ---------

Income tax (expense) benefit computed at

<S>                                                    <C>                      <C>             <C>           <C>      
statutory federal tax rate...................          $2,305                   $(2,381)        $(17,112)     $(35,325)
State income taxes...........................             206                     1,088           (1,316)       (1,880)
Non-deductible amortization and expenses.....             (61)                      (92)            (246)         (544)
Non-deductible merger and defense costs......              --                    (2,097)              --            --
Effect of Foreign Sales Corporation..........             191                       230              349         1,013
Other, net...................................            (537)                     (396)            (124)         (726)
                                                   ----------------        ------------------   ---------   -----------
Income tax (expense) benefit.................          $2,104                   $(3,648)        $(18,449)     $(37,462)
                                                   ================        ==================   =========   ===========
</TABLE>



The net deferred income tax liability consists of the following (in
thousands):

                                                           Predecessor Company
                                                               December 31,
                                               ------------  -----------------
                                                      1997         1996
                                               ------------  -----------------
Property, plant and equipment................      $180,597           $52,071
Intangible assets............................           376             1,709
                                               ------------     -------------
            Gross deferred tax liabilities...       180,973            53,780
                                               ------------     -------------
Accounts receivable..........................        (1,192)             (653)
Inventories..................................        (2,863)              (46)
Tax losses and credits carried forward.......             -              (620)
Other noncurrent assets......................          (504)           (1,686)
Other noncurrent liabilities.................       (14,251)          (12,592)
Other current assets and liabilities.........        (1,487)           (1,013)
                                               ------------     -------------
            Gross deferred tax assets........       (20,297)          (16,610)
                                               ------------     -------------
                                                   $160,676          $ 37,170
                                               ============     =============

The net deferred income tax liability is presented in the accompanying
consolidated balance sheets as follows:

                                                  Predecessor Company
                                                  -------------------
                                      1997            1996
                                   ----------     -------------------
Net current (asset) liability        $ (5,543)         $(2,816)
Net long-term liability               166,219           39,986
                                   ----------     -------------------
Net                                  $160,676          $37,170
                                   ==========     ===================


            At December 31, 1996, the CT Business had an $8.1 million
operating loss carryforward related to the operations of the CT Business in
the United Kingdom. The CT Business was sold in 1997. (see note 16)

13.         INTEREST EXPENSE

            For the year ended December 31, 1997, interest expense consists
of (i) interest on the 11 3/4% Senior Notes, (ii) interest on the Amended
Credit Facility and Term Loan, (iii) amortization of debt issuance costs,
net of (iv) an allocation for interest capitalized in connection with
construction projects, (v) interest on the Intercompany Loan, and (vi)
interest on the Capital Lease. For the years ended December 31, 1996 and
1995, interest expense consists of items (i) through (iv) of the preceding
sentence.


14.         OTHER INFORMATION

            Export sales from operations were $9,765,000, $19,530,000,
$28,743,000 and $24,046,000 for the four months ended December 31, 1997,
the eight months ended August 31, 1997 and the years ended December 31,
1996 and 1995, respectively.

            Maintenance and repair expenses were $8,068,000, $17,517,000,
$23,150,000 and $22,678,000 for the four months ended December 31, 1997,
the eight months ended August 31, 1997, and the years ended December 31,
1996 and 1995, respectively.

15.          EMPLOYEE BENEFITS

SAVINGS PLAN

            The Company sponsors an employee savings plan (the "Savings
Plan") that provides participating employees with additional income upon
retirement. Employees may contribute annually between 1% and 10% of their
base salary up to the IRS pre-tax contribution limit ($9,500 for 1997) to
the Savings Plan. The Company matches a minimum of 25% of the employee's
aggregate contributions up to 6% of the employees base salary. Employee
contributions are fully vested. Employer contributions are fully vested
upon retirement or after five years of service. For 1997, 1996 and 1995,
the Company matched 25% of the employee contributions up to the 6% limit,
contributing approximately $575,000, $526,000 and $388,000 to the Savings
Plan, respectively, substantially all of which pertains to continuing
operations.

            The Savings Plan merged with the Huntsman Salary Deferral Plan
as of January 1, 1998. As of the merger date, the Company match is 50% of
the employee's contributions up to 4% of eligible pay.

PENSION AND RETIREMENT PLANS

            The Company sponsored two noncontributory defined benefit plans
(the "Pension Plans") covering substantially all full-time employees.
Benefits provided under the Pension Plans are primarily based on years of
service and the employees final average earnings. The Company's funding
policy is to contribute annually an amount based upon actuarial and
economic assumptions designed to achieve adequate funding of projected
benefit obligations.

            One of the Pension Plans was merged with the Huntsman Defined
Benefit Pension Plan as of January 1, 1998. This plan also provides
benefits based on years of service and the employee's final average
earnings.

            The Company sponsored a Supplemental Executive Retirement Plan
(the "SERP") to provide supplemental retirement and survivor benefits for
certain key employees who complete a specified period of service and
otherwise become eligible under the SERP. During 1997, the Company
purchased annuities to fully cover the benefits and liabilities accrued
under the SERP.

            The Company provides retirement and death benefits to certain
employees through an Executive Security Plan (the "Security Plan"). The
Company does not fund the Security Plan, and no amount was funded for the
Security Plan in 1996 and 1995. No new employees have been added to this
plan, and it is not expected that any additional employees will participate
in the Security Plan.

            The accompanying tables include amounts for the SERP and
Security Plan.

            The net pension expense for the Pension Plans are reflective of
historical data adjusted for the discontinued operations of the CT
Business. Net pension expense consists of the following (in thousands:):

<TABLE>
<CAPTION>
                                                                     Predecessor Company
                                                          -------------------------------------------
                                                                           Years Ended December 31,
                                                                          ---------------------------
                                                            Eight Months    
                                     Four Months Ended     Ended-August
                                     December 31, 19997      31, 1997        1996              1995
                                     ------------------    -------------   --------         ---------
<S>                                          <C>               <C>           <C>               <C>   
Service Cost                                 $525              $976          $2,248            $1,783
Interest Cost                                 663             1,254           1,929             1,646
Actual return on plan assets                  127            (2,967)         (1,236)           (2,298)
Net amortization and deferral                (781)            1,980             312             1,713
                                       ----------          --------        --------          --------
Net pension expense                     $     534           $ 1,243         $ 3,253           $ 2,844
                                       ----------           -------        --------          --------
</TABLE>

            The following table sets forth the funded status of the Pension
Plans at December 31 (in thousands):

<TABLE>
<CAPTION>
                                                                          Predecessor
                                                                           Company
                                                                         -------------
                                                                 1997        1996
                                                               -------     -------
Actuarial present value of benefit obligations:

<S>                                                            <C>         <C>    
             Vested benefits                                   $22,098     $18,044
            Non-vested benefits                                  5,903       8,932
                                                               -------     -------
Accumulated benefit obligations                                $28,001     $26,976
                                                               -------     -------
Projected benefit obligation                                   $32,389     $30,946
Plan assets at fair value                                      25,961      (18,164)
                                                               -------     -------
Excess of projected benefit obligations over plan assets        6,428       12,782
Unrecognized net loss                                          (1,733)      (2,992)
Unrecognized prior service cost                                     -       (4,162)
Additional liability                                                -        2,299
                                                               -------     -------
Pension liabilities included in other noncurrent liabilities   $4,695       $7,927
                                                               -------     -------

</TABLE>

            At December 31, 1997 and 1996, in determining the present value
of benefit obligations, a discount rate of 7.0% and 7.75% was used,
respectively. The assumption for the increase in future compensation levels
was 4.0% and 4.5% at December 31, 1997 and 1996 respectively. For 1997 and
1996, the expected long-term rate of return on assets used in determining
pension expense was 9.0%.

POSTEMPLOYMENT BENEFITS

            The Company's obligation for postemployment benefits at
December 31, 1996 approximated $.3 million and is included in other
noncurrent liabilities. There were no such obligations as of December 31,
1997.

POSTRETIREMENT BENEFITS OTHER THAN PENSIONS

            The Company sponsors postretirement benefits other than the
Pension Plans, such as health care and medical benefits. The Company
reimburses retirees for these benefits but does not provide any additional
funding for the postretirement benefits.

            The net postretirement benefit expense is reflective of
historical data adjusted for the discontinued operations of CT Film. Net
postretirement benefit expense consists of the following (in thousands):

<TABLE>
<CAPTION>
                                                                               Predecessor Company
                                                               -----------------------------------------------------
                                                                                            Years Ended December 31,
                                                                                            ------------------------
                                          Four Months Ended        Eight Months
                                          December 31, 1997     Ended August 31, 1997         1996         1995
                                          -----------------     ---------------------         ----        -----
<S>                                              <C>                 <C>                    <C>            <C>    
Service Cost                                     $ 80                $295                   $   284        $   269
Interest Cost                                    294                 636                        653            636
Net amortization and deferral                    --                 (167)                     (216)          (211)
                                                 ---                -----                 ---------     ----------
Net postretirement benefit expense
                                                $ 374               $ 764                  $    721       $    694
                                                -----               -----                  --------       --------
</TABLE>

The following table sets forth the funded status of the postretirement
benefits at December 31 (in thousands):

<TABLE>
<CAPTION>
                                                                                          Predecessor
                                                                                            Company
                                                                                          ------------
                                                                               1997            1996
                                                                               ----            ----
Actuarial present value of benefit obligations:
<S>                                                                          <C>            <C>    
Active participants eligible for retirement                                  $4,180         $ 3,527
Active participants not yet eligible for retirement                           4,644           4,884
Retired participants                                                          3,098           1,662
                                                                           --------        --------
Accumulated postretirement benefit obligation                               $11,922        $ 10,073
Plan assets at fair value                                                        --              --
                                                                           --------        --------
Excess of projected benefit obligations over plan assets                     11,922          10,073
Unrecognized prior service cost                                                  --           (848)
 Unrecognized net gain                                                           --           4,244
                                                                           --------        --------
Postretirement benefits included in other noncurrent liabilities          $  11,922      $   13,469
                                                                          =========      ==========
</TABLE>

            In 1997 and 1996, in determining the value of postretirement
benefit obligations, a discount rate of 7.0% and 7.75% respectively, was
used, and in 1997 the health care trend rate used to measure the expected
increase in cost of benefits was assumed to be 7.0% in 1997, and descending
to 4.5% in 2003 and thereafter. A one percentage-point increase in the
assumed health care cost trend rate for each year would increase the
accumulated postretirement benefit obligation as of December 31, 1997 by
approximately $415,000 and would increase the service and interest cost
components of the net postretirement benefit cost for the year ended
December 31, 1997 by approximately $40,000.

EMPLOYEE STOCK OPTION PLANS

            In 1988, the Company adopted a stock incentive plan (the "Stock
Incentive Plan") providing for the granting of 87,500 stock options for,
stock appreciation rights in, and the sale of restricted shares of, common
stock for certain employees. In 1993, the Company adopted a stock option
plan (the "Employee Plan") providing for the granting of 700,000 stock
options for common stock to key employees of the Company. In 1994, the
Company adopted a long-term incentive plan (the "Incentive Plan") providing
for the granting of 882,000 stock options for common stock to key employees
of the Company. The Incentive Plan was intended to replace the Stock
Incentive Plan and the Employee Plan. The Company has granted non-qualified
stock options under the Stock Incentive Plan, the Incentive Plan and the
Employee Plan. In August 1996 the Company granted 489,500 stock options to
employees under the Incentive Plan.

            The exercise price of stock options is based on the average
trading price of the stock for twenty days prior to the grant date. Changes
in stock options during the years indicated are as follows:

<TABLE>
<CAPTION>
                                                                Options         Price Range      Weighted Average
                                                              Outstanding        Per Share        Exercise Price
                                                           --------------       -----------      ----------------
<S>                                                           <C>            <C>                     <C>  
Balance at December 31, 1994.......................            705,629        $3.43 -- 95.20          $7.81
  Exercised........................................            (16,157)        3.43 -- 3.71            3.55
   Canceled........................................             (9,561)        3.43 -- 95.20          80.04
                                                           --------------      
Balance at December 31, 1995.......................            679,911         3.43 -- 14.63           6.89
   Granted.........................................            489,500             10.79              10.79
   Exercised.......................................            (29,168)        3.43 -- 3.71            3.57
   Canceled........................................            (28,566)        3.43 -- 14.63          12.07
Balance at December 31, 1996.......................          1,111,677         3.43 -- 14.63           9.02
                                                           --------------       
   Exercised or bought-out in connection with

      Merger.......................................         (1,111,677)        3.43 -- 14.63           9.02
                                                           --------------      
Balance at December 31, 1997                                       --
                                                           ==============
</TABLE>


    At December 31, 1997, no options were available for grant or
outstanding.


OUTSIDE DIRECTOR STOCK OPTION PLAN

            In 1993, the Company adopted a non-qualified stock option plan
for outside directors providing for the granting of 225,000 stock options
for common stock. In 1995, the Company adopted a non-qualified stock option
plan for outside directors providing for the granting of 60,000 stock
options for common stock. The exercise price of stock options is less than
the market value of the Company's stock on the date of grant. Accordingly,
compensation expense is recognized by the Company with respect to such
grants. Changes in stock options during the years indicated are as follows:
<TABLE>
<CAPTION>

                                                          Options          Price Range    Weighted Average  
                                                        Outstanding         Per Share      Exercise Price
                                                        ------------     ---------------  ------------------
<S>                                                       <C>          <C>                    <C>  
Balance at December 31, 1994........................       175,001      $0.43-- 0.63          $0.53
    Granted.........................................        14,500          2.09               2.09
    Exercised.......................................      (104,167)      0.43-- 0.63           0.55
                                                        ----------
Balance at December 31, 1995........................        85,334       0.43-- 2.09           0.76
    Granted.........................................        14,000          3.22               3.22
    Exercised.......................................       (33,584)      0.43-- 2.09           0.75
   Balance at December 31, 1996.....................        65,750       0.43-- 3.22           1.28
    Granted.........................................         4,000          3.56               3.56
Exercised or bought-out in connection with merger...       (69,750)      0.43-- 3.56           1.41
                                                        ----------
Balance at December 31, 1997                                    --
                                                        ==========
</TABLE>

            At December 31, 1997, no options were available for grant or
outstanding.

            As permitted by SFAS No. 123, the Company elected to continue
to use Accounting Principles Board Opinion No. 25, "Accounting for Stock
Issued to Employees" and related interpretations in accounting for its
stock option incentive plans. If the Company had elected to recognize
compensation cost based on the fair value of the options granted at grant
date and the vesting provisions under the plans in accordance with SFAS No.
123, net income in 1996 would have been reduced by approximately $118,000,
or $.01 per share. Earnings per share for 1995 would not have changed. The
average fair value of each option granted during 1996 under the Incentive
Plan is estimated at $8.48 on the date of grant using the Noreen-Wolfson
option pricing model with the following assumptions: (i) volatility of
46.9%; (ii) risk free interest rates of 6.9%; (iii) expected life of ten
years with no defaults; and (iv) the Company's present dividend yield rate.
The effects of applying SFAS No. 123 in this pro forma disclosure are not
necessarily indicative of future amounts as SFAS No. 123 does not apply to
awards prior to 1995.


STOCK BONUS PLAN

            In 1985, the Company established an employee stock bonus plan
(the "Stock Bonus Plan") for the benefit of its employees. Contributions
were made at the discretion of the Company. Effective January 1, 1992, all
participants (as defined) became 100% vested, and participation in the
Stock Bonus Plan was frozen. In May 1996, the Company terminated the Stock
Bonus Plan and distributed all the funds.

16.        RELATED PARTY TRANSACTIONS

            On September 30, 1997, the Company completed the sale of
substantially all operating assets of its CT Film division. Subsequent to
the September 30th effective date, all transactions between the Company and
Huntsman Packaging Corporation, the new owner of the CT Film division and
an affiliate of HC, are considered related party transactions. In
connection with the sale, the Company received $70 million in cash and the
buyer assumed approximately $8 million in current liabilities. Subsequent
to the sale and through December 31, 1997, the Company continued to pay
selected payroll, severance and sales and administrative expenses for the
CT Film Business and has recorded the related expenses as receivables from
Huntsman Packaging.

            A summary of transactions between the Company and other related
parties as of, and for the four months ended December 31, 1997, is
summarized as follows in thousands of dollars:

                                                           Four Months
                                                       Ended December 31, 1997
                                                       -----------------------

Sales to:
        Huntsman Petrochemical Corporation                   $       596
        Huntsman Chemical Corporation                              2,500
        Huntsman Corporation                                      69,073
Trade accounts receivable from:
        Huntsman Corporation                                      69,428
Payroll receivable from:
        Huntsman Packaging Corporation                             6,148 
Other miscellaneous receivables from:
        Huntsman Packaging Corporation                             1,507
        Huntsman Corporation                                         586
        Employee advances                                            727
Product purchases from:
        Huntsman Petrochemical Corporation                           766
Interest expense paid to:
        Huntsman Group Holdings Finance Company                    7,568
Miscellaneous accounts payable to:
        Huntsman Petrochemical Corporation                           884
        Huntsman Packaging Corporation                               562
        Huntsman Corporation                                       4,958
Long-term debt payable to:
        Huntsman Group Holdings Finance Company                  258,055
Long-term capital lease payable to:
        Huntsman Group Holdings Finance Company
          (including accrued interest)                            51,535


17.         CONTINGENCIES

ENVIRONMENTAL REGULATION

            The Company, and the industry in which it competes, is subject
to extensive environmental laws and regulations concerning, for example,
emissions to the air, discharges to surface and subsurface waters and the
generation, handling, storage, transportation, treatment and disposal of
waste and other materials. The Company believes that, in light of the its
historical expenditures and expected future results of operations, it will
have adequate resources to conduct its operations in compliance with
currently applicable environmental and health and safety laws and
regulations. However, in order to comply with changing facility permitting
and regulatory requirements, the Company may be required to make additional
significant site or operational modifications that are not currently
contemplated. Further, the Company has incurred and may in the future incur
liability to investigate and clean up waste or contamination at its current
or former facilities, or which it may have disposed of at facilities
operated by third parties.

            On the basis of reasonable investigation and analysis,
management believes that the approximately $8.5 million accrued in the
December 31, 1997 balance sheet is adequate for the total potential
environmental liability of the Company with respect to contaminated sites.
Extensive environmental investigation of the groundwater, soils and solid
waste management units has been conducted at the Odessa Facility. Risk
assessments have been completed for a number of these facilities and
corrective measures have been defined and conducted. The Company received
approval to allow closure of five solid waste management units which
enabled a reduction in the accrual for potential environmental liability of
approximately $9.0 million in the first quarter of 1997.

            The Company continually reviews its estimates of potential
environmental liabilities. However, no assurance can be given that all
potential liabilities arising out of the Company's present or past
operations have been identified or fully assessed or that the amounts that
might be required to remediate such conditions will not be significant to
the Company. The Company's operating expenditures for environmental
remediation, compliance and waste disposal were approximately 7.1 million,
$7.6 million and $8.3 million in 1997, 1996 and 1995, respectively,
substantially all of which relates to continuing operations.

            The Company historically disposed of its wastewater from the
Odessa Facility through injection wells operated under permits from the
TNRCC. Due to concerns by the agency regarding the operation of these
underground injection wells, and their intention to not renew the permits
after they expired in December 1997, the Company entered into an agreement
with the City of Odessa and the Gulf Coast Waste Disposal Authority
pursuant to which the latter is currently disposing of the wastewater
through the refurbished Odessa South Wastewater Treatment Facility, a
publicly-owned-treatment-works ("POTW"). The cost of refurbishing the
City's wastewater treatment facility, which is approximately $8.0 million,
has been financed principally by the Company. This facility was brought
on-line in October and November of 1997 and culminates three years of
working together to provide a long range, cost effective wastewater
disposal solution. Wastewater is pumped to this facility where it is mixed
with City effluent as well as other industrial discharges. The water is
treated to meet discharge standards before it is released to an
intermittent-flowing stream for further reuse.

STOCKHOLDER LITIGATION

            On July 23, 1996, the Company was served with a purported
stockholder class action lawsuit filed in the Chancery Court of the State
of Delaware, in and for New Castle County, arising from the Company's
rejection of the unsolicited offer from Huntsman Corporation to purchase
the outstanding shares of Common Stock. The lawsuit names the Company and
each of its directors as defendants. The complaint alleged that the
defendant directors breached their fiduciary duty to stockholders by
refusing to attempt in good faith to maximize stockholder value in the sale
of the Company and engaging in a plan to thwart and reject offers from
third parties, including Huntsman Corporation, in order to entrench
management. Plaintiff sought certification of the lawsuit as a class
action, an order requiring defendants to take various actions including
exposing the Company to the market place in an effort to create an auction
of the Company and an unspecified amount of damages. The Company is also
aware of two other similar lawsuits that are pending in the Chancery Court.
Plaintiffs' counsel in these cases has agreed to an indefinite extension of
defendants' answer date. Under the agreement, defendants do not need to
respond to the complaints until notified to do so by plaintiffs' counsel.
Huntsman Corporation acquired the Common Stock at a price $2.00 per share
in excess of that referred to in the complaint. Accordingly, the Company
believes it likely that this lawsuit will be dismissed.

PHILLIPS BLOCK COPOLYMER LITIGATION

            In March 1984, Phillips Petroleum Company ("Phillips") filed a
lawsuit against the Company seeking injunctive relief, an unspecified
amount of compensatory damages and treble damages. The complaint alleged
that the Company was infringing two Phillips patents titled "Preparation of
Block Copolymers," the last of which expired in 1994. This action, which
was originally filed in Illinois, was transferred to the United States
District Court for the Southern District of Texas, Houston Division. After
discovery proceedings were completed, the Company filed a motion for
summary judgment. Phillips filed a motion for partial summary judgment.
Pursuant to an agreement among the parties, the court appointed a special
master who conducted a hearing on these motions and thereafter recommended
to the court that the Company's motion be granted and Phillips' motion be
denied. Thereafter, Phillips filed motions to disqualify the special
master, to reject the recommendation of the special master and to enter
partial summary judgment for Phillips. In 1993, the court entered an order
denying Phillips' motion to disqualify the special master. In the Company's
bankruptcy proceeding in 1992, Phillips filed a proof of claim seeking in
excess of $108 million based upon the allegations in this litigation. The
Company objected to the claim and elected to leave the legal, equitable and
contractual rights of Phillips unaltered, thereby allowing this litigation
to proceed without regard to the bankruptcy proceeding. On December 23,
1996, the court entered a final judgment in favor of the Company after
granting the Company's motion for summary judgment. Phillips appealed the
judgment. The appeal was argued before the Court of Appeals for the Federal
Circuit on November 5, 1997. No decision has been issued.

PHILLIPS CRYSTALLINE LICENSE LITIGATION

            In May 1990, Phillips filed a lawsuit (the "Action") against
the Company in the United States District Court for the District of
Delaware (the "Trial Court") seeking injunctive relief, an unspecified
amount of compensatory damages, treble damages and attorneys' fees, costs
and expenses. The complaint alleged that the Company was infringing
Phillips' U.S. Patent No. 4,376,851 (the "'851 Patent") by virtue of its
continued manufacture of crystalline polypropylene after Phillips
purportedly terminated its license agreement (the "Original License
Agreement") with the Company on April 23, 1990. At trial in October 1994,
the Company asserted several defenses and, in June 1995, the Trial Court
ruled in favor of the Company and Phillips appealed. In March 1996, the
Court of Appeals for the Federal Circuit entered an order reversing the
Trial Court's decision and remanding the Action to the Trial Court. The
Trial Court reviewed and ruled on the Company's other defenses and on
September 4, 1997, the Trial Court entered a judgment in favor of Phillips
finding that the Company had infringed the '851 Patent for the period from
April 24, 1990 to September 4, 1997.

            On September 19, 1997, the Company and Phillips entered into a
settlement agreement (the "Settlement Agreement"), pursuant to which the
Company paid a lump sum of $10 million to Phillips on September 26, 1997,
and will pay up to $300,000 for each subsequent calendar quarter period.
Such quarterly payments begin with the quarter ending December 31, 1997,
and must be paid through the partial quarter ending March 15, 2000, when
the '851 Patent expires. Pursuant to the Settlement Agreement, the Company
and Phillips released and discharged each other from all claims, debts,
demands, liabilities, losses, causes of action, damages, costs and expenses
relating to the subject matter of the Action. In the event the Company
fails to make a timely payment to Phillips when such payment is due
pursuant to the Settlement Agreement, the Company will be obligated to pay
Phillips accrued interest on such payment.

            Effective September 5, 1997, Phillips and the Company entered
into a new crystalline polypropylene license agreement (the "New License
Agreement"). Pursuant to the New License Agreement, Phillips granted to the
Company a nonexclusive, royalty-bearing license to manufacture, use and/or
sell any product which is covered by the '851 Patent. The term of the New
License Agreement is for the period from September 5, 1997, until the
expiration of the '851 Patent on March 15, 2000, unless otherwise
terminated under the provisions thereof. The royalty rate under the New
License Agreement is substantially higher than the royalty rate under the
Original License Agreement. In the event the Company fails to make a timely
payment to Phillips when such payment is due pursuant to the New License
Agreement, the Company will be required to pay Phillips accrued interest on
such payment.

ODESSA RESIDENTS' TORT LITIGATION

            On April 15, 1994, the national and state chapters of the
National Association for the Advancement of Colored People ("NAACP") and
approximately 770 residents of a neighborhood approximately one mile
northwest of the Shell Oil Company ("Shell"), the Company and Dynagen, Inc.
("Dynagen") plants in Odessa, Texas petitioned the State District Court in
Odessa, Texas to intervene in a previously existing lawsuit against Dynagen
to (a) add as additional defendants the Company, Shell and General Tire
Corporation (the parent company of Dynagen) and (b) have the litigation
certified as a class action. The plaintiffs' petition seeks an unspecified
amount of money damages for past, present and future injuries to
plaintiffs' health, wrongful death, loss of consortium and reduction in
property values; the conduct of and payment for property clean up,
remediation and relocation costs; payment of expenses for medical testing
and monitoring; funding of pollution and health studies; attorneys' fees;
punitive damages and injunctive relief. Plaintiffs' petition specifies
alleged pollution from air emissions from the three plants as a basis for
their claims. The trial court allowed the intervention and severed the
action from the original lawsuit against Dynagen. Plaintiffs have withdrawn
their motion to have the litigation certified as a class claim. In November
1994, the plaintiffs filed an amended petition which substituted the Odessa
branch of the NAACP as plaintiff in place of the national and state
chapters of the NAACP. The amended complaint also added approximately 100
additional plaintiffs. In May 1996, the trial court announced that the
lawsuit would be tried by groups of plaintiffs and set the first group of
65 plaintiffs for trial in May 1997. The trial court allowed plaintiffs'
counsel to designate ten plaintiffs for the first trial, and the trial
court selected the remaining 55 at random. Discovery was ongoing when in
late January 1997 the parties and the trial court agreed to a 30-day
moratorium to determine if this case could be settled and the May 1997
trial date was vacated. At mediation, the Company agreed to a settlement of
this case and a related case filed in Houston in late 1996 on behalf of 7
similarly situated plaintiffs. The trial court approved the settlement on
March 17, 1997. Although the terms of the settlement are confidential, the
settlement did not have a material adverse effect on the Company's
financial position, results of operations or cash flows. Several plaintiffs
unrepresented by counsel were not included in the settlement. All
plaintiffs in the Houston case settled and that lawsuit was dismissed. The
trial court in this case dismissed the claims of certain of those
plaintiffs on motion from the defendants. One of these plaintiffs has filed
a motion for new trial, which was granted. Approximately 20 plaintiffs
remain after these matters were finalized. On March 16, 1998, the trial
court in the case, severed their case from the plaintiffs who settled or
whose claims were dismissed. The NAACP lawsuit is being dismissed.

            Although there can be no assurance of the final resolution of
any of these matters, the Company believes that, based upon its current
knowledge of the facts of each case, it has meritorious defenses to the
various claims made and intends to defend each suit vigorously, and the
Company does not believe that the outcome of any of these lawsuits will
have a material adverse effect on the Company's financial position, results
of operations or cash flows.

            The Company is also a party to various lawsuits arising in the
ordinary course of business and does not believe that the outcome of any of
these lawsuits will have a material adverse effect on the Company's
financial position, results of operations or cash flows.

18.         QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

            Summarized quarterly financial information for the years ended
December 31, 1997 and 1996 is presented below. Effective September 30,
1997, the Company sold the assets of the CT Film division. The quarterly
data is reflective of historical data adjusted for the discontinued
operations of CT Film. Amounts are presented in thousands:
<TABLE>
<CAPTION>

                                                                                For quarter ended,

                 --------------------------------------------------------------------------------------------------------------
                  December 31,  September 30,   June 30,     March 31,    December 31,  September 20,    June 30,     March 31.
                      1997          1997          1997         1997           1996          1996           1996         1996
                 --------------------------------------------------------------------------------------------------------------
<S>               <C>           <C>           <C>          <C>            <C>           <C>            <C>          <C>     
Net sales         $103,344      $107,635      $110,983     $125,316       $112,745      $109,901       $108,289     $104,362
Gross Profit         5,406        14,437        32,541       17,093         27,067        28,427         25,353       23,783
Extraordinary
loss                     -             -          (694)           -              -             -              -            -
Net income (loss)   (6,889)      (12,378)        8,221        6,114          7,166         8,603          7,492        6,470

</TABLE>


                               EXHIBIT INDEX

EXHIBIT NUMBER         DESCRIPTION                                  PAGE NO.

    2.1     --    First Amended Plan of Reorganization of Rexene Products
                  Company, et al., dated April 29, 1992 (filed as Exhibit
                  2.1 to the Company's Form 8-K Current Report dated July
                  7, 1992 and incorporated herein by reference).

    2.2     --    Order Confirming First Amended Plan of Reorganization,
                  dated April 29, 1992 (filed as Exhibit 2.2 to the Rexene
                  Corporation's (now known as Huntsman Polymers
                  Corporation) Annual Report on Form 10-K for the fiscal
                  year ended December 31, 1992 and incorporated herein by
                  reference).

    2.3     --    Plan and Agreement of Merger, between Rexene Corporation
                  and Rexene Products Company, dated as of September 11,
                  1992 (filed as Exhibit 2.3 to the Rexene Corporation's
                  (now known as Huntsman Polymers Corporation) Annual
                  Report on Form 10-K for the fiscal year ended December
                  31, 1992 and incorporated herein by reference).

    2.4     --    Agreement and Plan of Merger by and among Huntsman
                  Corporation, Huntsman Centennial Corporation and Rexene
                  Corporation dated June 9, 1997.

    3.1     --    Restated Certificate of Incorporation and the Certificate
                  of Amendment to the Certificate of Incorporation (filed
                  as Exhibit 3(i) to Rexene Corporation's (now known as
                  Huntsman Polymers Corporation) Quarterly Report on Form
                  10-Q for the quarterly period ended September 30, 1997
                  and incorporated by reference).

    3.2     --    By-Laws (filed as Exhibit 3(ii) to Rexene Corporation's
                  (now known as Huntsman Polymers Corporation) Quarterly
                  Report on Form 10-Q for the quarterly period ended
                  September 30, 1997 and incorporated herein by reference).

    4.1     --    Indenture, dated as of November 29, 1994, between Rexene
                  Corporation, as Issuer, and Bank One, Texas, N.A., as
                  Trustee, for $175,000,000 11 3/4% Senior Notes due 2004
                  (filed as Exhibit 4.1 to Rexene Corporation's (now known
                  as Huntsman Polymers Corporation) Annual Report on Form
                  10-K for the fiscal year ended December 31, 1994 and
                  incorporated herein by reference).

    4.2.1   --    Stockholder Rights Agreement, between Rexene Corporation
                  and American Stock Transfer & Trust Company, as Rights
                  Agent, dated as of January 26, 1993 (filed as Exhibit
                  4.20 to Rexene Corporation's (now known as Huntsman
                  Polymers Corporation) Annual Report on Form 10-K for the
                  fiscal year ended December 31, 1992 and incorporated
                  herein by reference).

    4.2.2   --    Amendment No. 1 to Stockholder Rights Agreement (filed as
                  Exhibit 1 to Rexene Corporation's (now known as Huntsman
                  Polymers Corporation) Form 8-A/A filed on October 21,
                  1994 and incorporated herein by reference).

    4.2.3   --    Amendment No. 2 to Stockholder Rights Agreement (filed as
                  Exhibit 99.4 to Rexene Corporation's (now known as
                  Huntsman Polymers Corporation) Form 8-A/A filed on July
                  26, 1996 and incorporated herein by reference).

    10.1*   --    Rexene Corporation 1988 Stock Incentive Plan (filed as
                  Exhibit 10.5 to Rexene Corporation's (now known as
                  Huntsman Polymers Corporation) Registration Statement on
                  Form S-1 (SEC No. 33-22723) and incorporated herein by
                  reference).

    10.2*   --    Rexene Corporation 1993 Non-Qualified Stock Option Plan
                  (filed as Exhibit 10.2 to Rexene Corporation's (now known
                  as Huntsman Polymers Corporation) Annual Report on Form
                  10-K for the fiscal year ended December 31, 1992 and
                  incorporated herein by reference).

    10.3*   --    Rexene Corporation 1994 Long-Term Incentive Plan (filed
                  as Exhibit 10.2 to Amendment No. 1 to Rexene
                  Corporation's (now known as Huntsman Polymers
                  Corporation) Registration Statement on Form S-3 (SEC File
                  No. 33-55507) as filed on October 21, 1994 and
                  incorporated herein by reference).

    10.4*   --    Non-Qualified Stock Option Plan for Outside Directors of
                  Rexene Corporation's (now known as Huntsman Polymers
                  Corporation) (filed as Exhibit 10.3 to Rexene
                  Corporation's Annual Report on Form 10-K for the fiscal
                  year ended December 31, 1992 and incorporated herein by
                  reference).

    10.5*   --    1995 Stock Option Plan for Outside Directors (filed as
                  Exhibit 10.19 to Rexene Corporation's (now known as
                  Huntsman Polymers Corporation) Form 10-Q Quarterly Report
                  for the quarterly period ended June 30, 1995 and
                  incorporated herein by reference).

    10.6*   --    Rexene Corporation Supplemental Executive Retirement Plan
                  (filed as Exhibit 10.3 to Amendment No. 1 to Rexene
                  Corporation's (now known as Huntsman Polymers
                  Corporation) Registration Statement on Form S-3 (SEC File
                  No. 33-55507) as filed on October 21, 1994 and
                  incorporated herein by reference).

    10.6.1* --    Amendment No. 1 to Rexene Corporation Supplemental Executive
                  Retirement Plan, dated as of June 1, 1996 (filed as
                  Exhibit 10.6.1 to Rexene Corporation's (now known as
                  Huntsman Polymers Corporation) Quarterly Report on Form
                  10-Q for the quarterly period ended June 30, 1996 and
                  incorporated herein by reference).

    10.6.2* --    Amendment No. 2 to Rexene Corporation Supplemental Executive
                  Retirement Plan, dated as of July 26, 1996 (filed as
                  Exhibit 10.6.2 to Rexene Corporation's (now known as
                  Huntsman Polymers Corporation) Quarterly Report on Form
                  10-Q for the quarterly period ended June 30, 1996 and
                  incorporated herein by reference).

    10.7.1* --    Rexene Corporation 1995 Annual Incentive Bonus Plan (filed
                  as Exhibit 10.6.3 to Rexene Corporation's (now known as
                  Huntsman Polymers Corporation) Annual Report on Form 10-K
                  for the fiscal year ended December 31, 1994 and
                  incorporated herein by reference).

    10.7.2* --    Rexene Corporation Executive Management Committee Annual
                  Incentive Plan (filed as Exhibit 10.7.2 to Rexene
                  Corporation's (now known as Huntsman Polymers
                  Corporation) Annual Report on Form 10-K for the fiscal
                  year ended December 31, 1996 and incorporated herein by
                  reference).

    10.7.3* --    Rexene Corporation 1996 Performance Unit Program for
                  Executive Officers (filed as Exhibit 10.7.3 to Rexene
                  Corporation's (now known as Huntsman Polymers
                  Corporation) Annual Report on Form 10-K for the fiscal
                  year ended December 31, 1996 and incorporated herein by
                  reference).

    10.7.4* --    Rexene Corporation Long Term Performance Unit Program for
                  Executive Officers (filed as Exhibit 10.7.4 to Rexene
                  Corporation's (now known as Huntsman Polymers
                  Corporation) Annual Report on Form 10-K for the fiscal
                  year ended December 31, 1996 and incorporated herein by
                  reference).

    10.8    --    First Amended Asset Purchase Agreement, dated as of September
                  26, 1997, between Huntsman Polymers Corporation and
                  Huntsman Packaging Corporation (filed as Exhibit 2.1 to
                  Huntsman Polymers Corporation's Current Report on Form
                  8-K filed on October 21, 1997 and incorporated herein by
                  reference).

    10.9    --    Intercompany Loan Agreement, dated as of August 27, 1997,
                  between Huntsman Group Holdings Finance Corporation and
                  Huntsman Polymers Corporation, dated as of August 27,
                  1997 (filed as Exhibit 10.1 to Huntsman Polymers
                  Corporation's Quarterly Report on Form 10-Q for the
                  quarterly period ended September 30, 1997 and
                  incorporated by reference).

    16.1    -     Letter re: Change in Certifying Accountant (filed as Exhibit
                  16 to Huntsman Polymers Corporation's Current Report on
                  Form 8-K filed on August 29, 1997 and incorporated herein
                  by reference).

    21.1    --    Subsidiaries of Huntsman Polymers Corporation.

    27.1    --    Financial Data Schedule.