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                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 10-K

              Annual Report Pursuant to Section 13 or 15(d) of the

                         Securities Exchange Act of 1934

                  FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2002

                          Commission file number 1-2918

                                  ASHLAND INC.
                            (a Kentucky corporation)

                              I.R.S. No. 61-0122250

                           50 E. RiverCenter Boulevard

                                  P.O. Box 391

                         Covington, Kentucky 41012-0391

                        Telephone Number: (859) 815-3333

                Securities Registered Pursuant to Section 12(b):

                                               Name of each exchange
        Title of each class                     on which registered
        -------------------                     -------------------
Common Stock, par value $1.00 per share       New York Stock Exchange
                                            and Chicago Stock Exchange
Rights to Purchase Series A Participating     New York Stock Exchange
 Cumulative Preferred Stock                 and Chicago Stock Exchange

              SECURITIES REGISTERED PURSUANT TO SECTION 12(G): NONE

     Indicate  by 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 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]

     At October  31,  2002,  based on the New York Stock  Exchange  closing
price, the aggregate market value of voting stock held by non-affiliates of
the  Registrant  was  approximately  $1,780,870,376.  In  determining  this
amount,  the  Registrant  has  assumed  that its  directors  and  executive
officers are affiliates. Such assumption shall not be deemed conclusive for
any other purpose.

     At October 31,  2002,  there were  68,242,197  shares of  Registrant's
common stock outstanding.

                       DOCUMENTS INCORPORATED BY REFERENCE

     Portions of Registrant's  Annual Report to Shareholders for the fiscal
year ended  September 30, 2002 are  incorporated by reference into Parts I,
II and IV.

     Portions of  Registrant's  definitive  Proxy Statement for its January
30, 2003 Annual Meeting of Shareholders  are incorporated by reference into
Part III.


<PAGE>
<TABLE>
<CAPTION>

                                TABLE OF CONTENTS
     <S>         <C>        <C>                                                                 <C>
     PART I                                                                                      Page
                  Item 1.    Business........................................................      1
                             APAC   .........................................................      1
                             Ashland Distribution............................................      2
                             Ashland Specialty Chemical......................................      2
                             Valvoline.......................................................      3
                             Refining and Marketing..........................................      4
                             Miscellaneous...................................................      7
                  Item 2.    Properties......................................................      10
                  Item 3.    Legal Proceedings...............................................      10
                  Item 4.    Submission of Matters to a
                             Vote of Security Holders........................................      12
                  Item X.    Executive Officers of Ashland...................................      12
     PART II
                  Item 5.    Market for Registrant's Common Stock and Related
                               Security Holder Matters.......................................      13
                  Item 6.    Selected Financial Data.........................................      13
                  Item 7.    Management's Discussion and Analysis of Financial
                             Condition and Results of Operations.............................      13
                  Item 7A.   Quantitative and Qualitative Disclosures About Market Risk......      13
                  Item 8.    Financial Statements and Supplementary Data.....................      13
                  Item 9.    Changes in and Disagreements with Accountants
                              on Accounting and Financial Disclosure.........................      13
     PART III
                  Item 10.   Directors and Executive Officers of the Registrant..............      13
                  Item 11.   Executive Compensation..........................................      14
                  Item 12.   Security Ownership of Certain Beneficial
                              Owners and Management and Related Shareholder Matters..........      14
                  Item 13.   Certain Relationships and Related Transactions..................      14
                  Item 14.   Controls and Procedures.........................................      14

     PART IV
                  Item 15.   Exhibits, Financial Statement Schedules and Reports
                              on Form 8-K....................................................      15


</TABLE>
<PAGE>




                                     PART I
ITEM 1. BUSINESS

     Ashland Inc. is a Kentucky corporation, organized on October 22, 1936,
with  its  principal   executive  offices  located  at  50  E.  RiverCenter
Boulevard,  Covington,  Kentucky 41011 (Mailing Address:  50 E. RiverCenter
Boulevard, P.O. Box 391, Covington,  Kentucky 41012-0391) (Telephone: (859)
815-3333).  The terms  "Ashland" and the  "Company" as used herein  include
Ashland Inc. and its  consolidated  subsidiaries,  except where the context
indicates otherwise.

     Ashland's  businesses are grouped into five industry  segments:  APAC,
Ashland  Distribution,  Ashland Specialty Chemical,  Valvoline and Refining
and  Marketing.  Financial  information  about these segments for the three
fiscal  years ended  September  30, 2002 is set forth on pages 60 and 61 of
Ashland's Annual Report to Shareholders for the fiscal year ended September
30, 2002 ("Annual Report").

     APAC  performs  asphalt  and  concrete  contract   construction  work,
including  highway paving and repair,  excavation  and grading,  and bridge
construction,  and produces asphaltic and ready-mix concrete, crushed stone
and other aggregate in the southern and midwestern United States.

     Ashland  Distribution  distributes  industrial chemicals and solvents,
plastics,  composite  materials and fine  ingredients  in North America and
plastics in Europe.  Ashland  Distribution also provides  environmental and
energy  management  services.   Ashland  Specialty  Chemical   manufactures
composites,  adhesives,  and  casting  binder  chemicals  for  use  in  the
transportation and construction industries. Ashland Specialty Chemical also
manufactures  water treatment  chemicals for use in the general  industrial
and merchant  marine  markets.  In  addition,  Ashland  Specialty  Chemical
manufactures   high  purity   chemicals   and  provides   services  to  the
microelectronics industry.

     Valvoline is a producer and marketer of premium packaged motor oil and
automotive chemicals, including appearance products,  antifreeze,  filters,
rust  preventives  and coolants.  In addition,  Valvoline is engaged in the
"fast oil change"  business  through outlets  operating under the Valvoline
Instant Oil Change(R) name.

     Marathon Ashland Petroleum LLC ("MAP"),  a joint venture with Marathon
Oil  Company,  operates  seven  refineries  with a total crude oil refining
capacity  of 935,000  barrels per day.  Refined  products  are  distributed
through a network of independent and company-owned  outlets in the Midwest,
the upper Great Plains and the  southeastern  United  States.  Marathon Oil
Company  holds a 62% interest in MAP,  and Ashland  holds a 38% interest in
MAP. Ashland accounts for its investment in MAP using the equity method.

     At September 30, 2002,  Ashland and its consolidated  subsidiaries had
approximately 24,300 employees (excluding contract employees).

                                      APAC

     The APAC  group of  companies  is the  nation's  largest  asphalt  and
concrete paving company and is a major supplier of construction  materials.
APAC performs construction work, such as paving,  repairing and resurfacing
highways,  streets,  airports,  residential  and  commercial  developments,
sidewalks  and  driveways,  and  grading  and base work.  In  addition,  it
performs a number of  construction  services such as excavation and related
activities  in  the  construction  of  bridges  and  structures,   drainage
facilities and underground utilities. APAC conducts its business through 25
market  focused  business  units  operating in 14 southern  and  midwestern
states.  Distinguished  by their local  identities,  these  business  units
provide  construction  services,  technologies and materials throughout the
regions in which they  operate.  These market  focused  business  units are
supported by management and administrative staff in Atlanta, Georgia.

     To  deliver  its  services  and  products,   APAC  utilizes  extensive
aggregate-producing properties and construction equipment. It currently has
36 permanent  operating  quarry  locations,  61 other aggregate  production
facilities,  67 ready-mix concrete plants, 242 hot-mix asphalt plants and a
fleet of over 16,500 mobile equipment units,  including heavy  construction
equipment and  transportation-related  equipment.  In certain market areas,
APAC  is  vertically  integrated  with  asphalt,  aggregate  and  ready-mix
operations, all complementing one another.

     Raw aggregate generally consists of sand, gravel,  granite,  limestone
and sandstone.  About 30% of the raw aggregate  produced by APAC is used in
APAC's  own  contract  construction  work  and the  production  of  various
processed construction  materials.  The remainder is sold to third parties.
APAC also  purchases  substantial  quantities of raw  aggregate  from other
producers   whose  proximity  to  the  job  site  renders  it  economically
attractive.  Most other raw  materials,  such as liquid  asphalt,  portland
cement and reinforcing steel, are purchased from third parties.

     Approximately   79%  of  APAC's  sales  and  operating   revenues  are
construction  revenues,  with  the  remaining  21%  coming  from  sales  of
construction  materials.  Approximately 83% of APAC's construction revenues
are derived

                                     1
<PAGE>

directly from highway and other public sector  sources,  with the remaining
17% coming from industrial and commercial customers and private developers.

     Climate and weather  significantly  affect revenues and margins in the
construction  business.  Due  to  its  location,  APAC  tends  to  enjoy  a
relatively long  construction  season.  Most of APAC's  operating income is
generated during the construction period of May to October.

     Total  backlog at  September  30, 2002 was $1,691  million  (including
APAC's   $130   million   proportionate   share  of  work   related  to  an
unconsolidated  equity  joint  venture),  compared  to  $1,629  million  at
September  30, 2001.  APAC includes a  construction  project in its backlog
when a contract is awarded or a firm letter of  commitment  is obtained and
funding is in place.  The backlog at September 30, 2002 is considered firm,
and a major portion is expected to be completed during fiscal 2003.

                              ASHLAND DISTRIBUTION

     Ashland  Distribution  Company  ("Ashland  Distribution")  distributes
chemicals,  plastics,  reinforcements  and resins,  and fine ingredients in
North  America  and  plastics  in  Europe.  Suppliers  include  many of the
nation's  leading chemical  manufacturers  and a growing number of offshore
producers.  Ashland Distribution  specializes in providing mixed truckloads
and  less-than-truckload  quantities  to  customers  in  a  wide  range  of
industries. Deliveries are facilitated through a network of owned or leased
facilities  including  approximately  70 locations in North  America and 25
locations in 18 foreign  countries.  Ashland  Distribution  operates in the
following major market segments:

     CHEMICALS - Ashland Distribution  distributes specialty and industrial
chemicals,  additives and solvents to industrial users through distribution
centers in the United  States,  Canada,  Mexico and Puerto Rico, as well as
some export  operations.  Markets  served  include the paint and  coatings,
inks, adhesives, polymer, rubber, industrial and institutional compounding,
automotive, appliance and paper industries.

     PLASTICS  -  Ashland  Distribution  sells a  broad  range  of  branded
thermoplastic  resins to injection molders,  extruders,  blow molders,  and
rotational molders in the plastics industry through distribution  locations
in the United  States,  Canada,  Mexico and Puerto Rico.  It also  provides
plastic material  transfer and packaging  services and  less-than-truckload
quantities of packaged thermoplastics.  Additionally,  Ashland Distribution
markets  a broad  range of  thermoplastics  to  processors  in  Europe  via
distribution centers located in Belgium, England, Finland, France, Germany,
Ireland,  Italy,  the  Netherlands,  Norway,  Poland,  Portugal,  Spain and
Sweden.

     COMPOSITES  -  Ashland  Distribution   supplies  mixed  truckload  and
less-than-truckload   quantities   of   polyester   thermosetting   resins,
fiberglass  and  other  specialty  reinforcements,   catalysts  and  allied
products to  customers  in the  reinforced  plastics  and  cultured  marble
industries  through   distribution   facilities  located  throughout  North
America.

     INGREDIENTS - Ashland  Distribution markets food-grade and nutritional
additives  and   ingredients  to  customers  in  North  America.   It  also
distributes cosmetic and pharmaceutical specialty chemicals.

     SERVICES - Ashland Distribution also provides energy and environmental
management  services.  Energy  services  include  customized  management of
energy  purchasing,  supply  and  transportation.  Environmental  services,
working in  cooperation  with  chemical  waste service  companies,  provide
customers with chemical waste collection, disposal and recycling services.

                         ASHLAND SPECIALTY CHEMICAL

     Ashland  Specialty  Chemical Company  ("Ashland  Specialty  Chemical")
manufactures composites, adhesives, and casting binder chemicals for use in
the transportation and construction industries.  Ashland Specialty Chemical
also  manufactures  water  treatment  chemicals  for  use  in  the  general
industrial and merchant marine markets.  In addition,  it manufactures high
purity chemicals and provides  services to the  microelectronics  industry.
Ashland  Specialty  Chemical owns and operates 33 manufacturing  facilities
and  participates  in 14  manufacturing  joint  ventures  in 18  countries.
Ashland Specialty Chemical is comprised of the following business units:

     COMPOSITE POLYMERS - This business unit manufactures and sells a broad
range   of   chemical-resistant,    fire-retardant,   general-purpose   and
high-performance  marine  grades of  unsaturated  polyester and vinyl ester
resins and  gelcoats  for the  reinforced  plastics  industry.  Key markets
include  the  transportation,  construction  and  marine  industries.  This
business  unit has  manufacturing  plants in  Jacksonville  and Fort Smith,
Arkansas; Los Angeles, California;  Bartow, Florida;  McMinnville,  Oregon;
Philadelphia,  Pennsylvania;  Johnson Creek,  Wisconsin;  Kelowna,  British
Columbia,  Canada; Kunshan,  China; Porvoo and Lahti, Finland;  Sauveterre,
France;  Miszewo,  Poland;  Benicarlo,  Spain;  and, through separate joint
ventures has manufacturing  plants in Sao Paolo,  Brazil, and Jeddah, Saudi
Arabia. In addition,  this business unit also manufactures products through
other Ashland  Specialty  Chemical  facilities  located in Neville  Island,
Pennsylvania,  and Mississauga,  Ontario, Canada. Effective September 2002,
the former Petrochemicals business unit became a group within the Composite
Polymers business unit. The

                                     2
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Petrochemical business manufactures maleic anhydride at Neal, West Virginia
and also markets maleic anhydride in North America.

     CASTING  SOLUTIONS  (FORMERLY  FOUNDRY  PRODUCTS) - This business unit
manufactures and sells foundry chemicals worldwide,  including sand-binding
resin  systems,   refractory  coatings,  release  agents,  engineered  sand
additives  and riser  sleeves.  This  business unit serves the global metal
casting  industry from 24  manufacturing  locations in 18  countries.  This
business unit changed its name to Casting Solutions business unit in 2002.

     DREW  INDUSTRIAL - This business unit supplies  specialized  chemicals
and consulting  services for the treatment of boiler water,  cooling water,
steam,  fuel and waste  streams.  It also  supplies  process  chemicals and
technical  services  to the  pulp  and  paper  and  mining  industries  and
additives  to  manufacturers  of latex and paint.  It  conducts  operations
throughout  North  America,  Europe and the Far East through  subsidiaries,
joint  venture   companies  and   distributors.   This  business  unit  has
manufacturing  plants in Kearny,  New Jersey;  Houston,  Texas;  Sydney and
Perth, Australia;  Singapore; Ajax, Ontario, Canada;  Somercotes,  England;
and Auckland, New Zealand.

     ELECTRONIC  CHEMICALS - This  business unit  manufactures  and sells a
variety of ultrapure  chemicals  for the worldwide  semiconductor  industry
through various manufacturing locations and also custom blends and packages
ultrapure liquid chemicals to customer  specifications.  This business unit
operates manufacturing plants in Pueblo,  Colorado;  Easton,  Pennsylvania;
Dallas, Texas; Pyongtaek-Shi,  Kyonggi-Do, Korea; Milan, Italy; and through
a joint venture with Union Petrochemical Corporation,  an ultrapure-process
chemicals  manufacturing  facility in Taiwan.  In addition,  it enters into
long-term  agreements  to  provide  complete  on-site  chemical  management
services,  including  purchasing,  warehousing and delivering chemicals for
in-plant  use of  high  purity  chemicals  at  major  facilities  of  large
consumers. This business unit's Fab Services business provides full-service
equipment  parts-cleaning,  refurbishment  and  management  services to the
semiconductor manufacturing industry from facilities in Chandler and Tempe,
Arizona; and Austin and Carrollton, Texas.

     SPECIALTY  POLYMERS & ADHESIVES - This business unit  manufactures and
sells  specialty  phenolic  resins  for  paper  impregnation  and  friction
material  bonding;  acrylic  polymers  for  pressure-sensitive   adhesives;
emulsion  polymer   isocyanate   adhesives  for  structural  wood  bonding;
polyurethane  and  epoxy  structural   adhesives  for  bonding   fiberglass
reinforced plastics,  composites,  thermoplastics and metals in automotive,
recreational,  and industrial  applications;  induction bonding systems for
thermoplastic  materials;  elastomeric  polymer  adhesives and butyl rubber
roofing  tapes  for  commercial  roofing  applications;  and  vapor-curing,
high-performance  urethane coatings systems. It has manufacturing plants in
Calumet  City,  Illinois;  Norwood  and  Totowa,  New  Jersey;  Ashland and
Columbus, Ohio; White City, Oregon; and Kidderminster, England.

     DREW MARINE - This  business  unit  supplies  specialty  chemicals for
water  and fuel  treatment  and  general  maintenance,  as well as  sealing
products,  welding and  refrigerant  products and fire  fighting and safety
services to the world's  merchant marine fleet. It also provides  shipboard
technical service for vessels serving ports throughout the world.

OTHER MATTERS

     For information on Ashland Distribution and Ashland Specialty Chemical
and federal,  state and local statutes and regulations  governing  releases
into,  or  protection  of,  the  environment,   see  "Item  1.  Business  -
Miscellaneous  -  Environmental  Matters" and "Item 3. Legal  Proceedings -
Environmental Proceedings" in this Form 10-K.

                                    VALVOLINE

     The  Valvoline  Company,  a division  of  Ashland,  is a  marketer  of
premium-branded  automotive  and  commercial  oils,  automotive  chemicals,
automotive appearance products and automotive services,  with sales in more
than 140 countries.  The Valvoline(R) trademark was federally registered in
1873  and is the  oldest  trademark  for a  lubricating  oil in the  United
States. Valvoline is comprised of the following business units:

     NORTH  AMERICAN:  DO IT YOURSELF  ("DIY") & DO IT FOR ME ("DIFM") - In
the  United  States  and  Canada,  Valvoline  markets  its array of premium
automotive  lubricants and chemicals to the U.S. private  passenger car and
light truck market  through two large  business units based on the consumer
segments  of the market,  "Do-It-Yourself"  and  "Do-It-For-Me."  These two
business units market Valvoline(R) motor oil, one of the top selling brands
in the  United  States;  synthetic  SynPower(R)  automobile  chemicals  for
"under-the-hood" use; Eagle One(R) automotive appearance products; Zerex(R)
antifreeze; and Pyroil(R) automotive chemicals. The DIY business unit sells
the  Valvoline  family of brands to  consumers  who perform  their own auto
maintenance,  through  retail auto parts stores,  mass  merchandisers,  and
warehouse  distributors and their affiliated jobber stores such as NAPA and
Carquest.  The DIFM business unit sells Valvoline products to consumers who
use auto service businesses, such as car dealers and

                                        3

<PAGE>

quick  lubes,  through  a  network  of  independent  distributors  and five
company-owned and operated "direct market" operations.

     The domestic Commercial and Specialty Products Group,  operated within
the DIFM  business  unit,  has a strategic  alliance  with  Cummins  Engine
Company, Inc. to distribute heavy-duty lubricants to the commercial market.

     This business unit also markets R-12, an automotive  refrigerant  that
was phased out of production in 1995.  R-12 is being replaced in the market
by a new  generation  of  refrigerants.  Valvoline  expects to deplete  its
inventory of R-12 in fiscal 2003.

     EAGLE  ONE - Eagle  One is a brand of  premium  automobile  appearance
chemicals  for  "above-the-hood"  applications.   Products  include  waxes,
polishes and wheel  cleaners.  Managed by Valvoline as a separate  business
unit,  Eagle One  markets its  products  through  Valvoline's  DIY and DIFM
business  units in North  America and through the  Valvoline  International
business  unit.  During  fiscal  2002,  Eagle One  successfully  introduced
Wax-As-U-Dry  automobile wax.  Wax-As-U-Dry is a first-of-its-kind  product
designed to be applied to the  automobile  during the  hand-drying  process
following the washing of the automobile.

     VALVOLINE  INTERNATIONAL - Valvoline  International  markets Valvoline
branded  products  and Eagle One  automotive  appearance  products  through
company-owned affiliates or business units in Australia,  Austria, Belgium,
Brazil, Denmark,  Finland,  Germany, Great Britain, Italy, the Netherlands,
Poland,  South Africa,  Sweden and Switzerland.  TECTYL(R) rust preventives
are marketed in Europe.  Licensees and distributors market certain products
in other parts of Europe,  Mexico, Central and South America, the Far East,
the Middle East and certain  African  countries.  Joint  ventures have been
established in China, Ecuador, India, Thailand and Venezuela. Packaging and
blending  plants  and  distribution  centers  in  Australia,   Canada,  the
Netherlands and the United States supply international customers.

     VALVOLINE INSTANT OIL CHANGE(R)  ("VIOC") - VIOC is one of the largest
competitors  in the  expanding  U.S.  "fast oil change"  service  business,
providing  Valvoline with a significant  share of the installed  segment of
the  passenger  car and light truck motor oil market.  As of September  30,
2002, 363 company-owned  and 335 franchised  service centers were operating
in 40 states.

     VIOC  has  continued  its  customer  service  innovation  through  its
upgraded and enhanced Maximum Vehicle Performance program ("MVP"). MVP is a
computer-based  program that maintains  system-wide  service records on all
customer  vehicles.  MVP also contains a database on all car models,  which
allows employees to make service recommendations based on a vehicle owner's
manual recommendations.

                             REFINING AND MARKETING

     Refining  and  Marketing  operations  are  conducted  by MAP  and  its
subsidiaries,    including   its   wholly-owned   subsidiaries,    Speedway
SuperAmerica LLC and Marathon  Ashland Pipe Line LLC.  Marathon Oil Company
("Marathon")  holds a 62% interest in MAP and Ashland  holds a 38% interest
in MAP.

REFINING

     MAP owns and operates  seven  refineries  with an  aggregate  refining
capacity of 935,000  barrels of crude oil per  calendar  day (1 barrel = 42
United States  gallons).  The table below sets forth the location and daily
crude  oil  throughput  capacity  (measured  in  barrels)  of each of MAP's
refineries as of September 30, 2002:

     Garyville, Louisiana...................................232,000
     Catlettsburg, Kentucky.................................222,000
     Robinson, Illinois.....................................192,000
     Detroit, Michigan...................................... 74,000
     Canton, Ohio........................................... 73,000
     Texas City, Texas...................................... 72,000
     St. Paul Park, Minnesota............................... 70,000
                                                            -------
         Total  ............................................935,000
                                                            =======

     MAP's   refineries   include   crude  oil   atmospheric   and   vacuum
distillation,    fluid    catalytic    cracking,    catalytic    reforming,
desulfurization   and  sulfur  recovery  units.  The  refineries  have  the
capability  to process a wide variety of crude oils and to produce  typical
refinery products,  including reformulated gasoline ("RFG"). In addition to
typical refinery products, the Catlettsburg refinery, an ISO-9000 certified
facility, manufactures lubricating oils and a wide range of petrochemicals.
For the twelve months ended September 30, 2002, 74% of MAP's  production of

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lubricating  oils was purchased by Valvoline and 39% of MAP's production of
petrochemicals was purchased by Ashland Distribution.

     MAP also produces a wide range of asphalt  products,  petroleum  pitch
(primarily  used in the  graphite  electrode,  clay  target and  refractory
industries),  aromatics,  aliphatic  hydrocarbons,  cumene,  base lube oil,
slack wax and polymer grade propylene.

     The table below sets forth  MAP's  refinery  total input and  refinery
production by product group for the twelve months ended September 30, 2002,
2001  and  2000.   Refinery  total  inputs  include  crude  oil  and  other
feedstocks.

<TABLE>
<CAPTION>
                                                         Twelve Months Ended September 30
                                               ----------------------------------------------------
    <S>                                               <C>              <C>               <C>
                                                      2002             2001              2000
                                                      ----             ----              ----
     Refinery Input
     (in thousands of barrels per day)              1,080.9          1,051.0           1,033.4
     ---------------------------------
     Refined Product Yields
     (in thousands of barrels per day)
     Gasoline...............................          594.0            560.5             559.0
     Distillates............................          292.9            278.7             271.5
     Propane................................           21.7             21.2              21.0
     Feedstocks & Special Products..........           83.5             69.9              68.9
     Heavy Fuel Oils........................           21.3             44.7              41.2
     Asphalt................................           73.3             74.5              73.3
                                                    -------          -------           -------
                    Total...................        1,086.7          1,049.5           1,034.9
                                                    =======          =======           =======
</TABLE>

     Planned maintenance activities requiring temporary shutdown of certain
refinery operating units are periodically  performed at each refinery.  MAP
had a major  turnaround  at the St. Paul Park refinery in the twelve months
ended September 30, 2002.

     The  Garyville,  Louisiana  coker  unit  project  achieved  mechanical
completion  in  October  2001  and  was  operating  at full  production  by
mid-December  2001. To supply this new unit,  MAP entered into a multi-year
contract with P.M.I. Comercio Internacional,  S.A. de C.V., an affiliate of
Petroleos  Mexicanos,  to purchase  approximately 90,000 barrels per day of
heavy Mayan crude oil. The contract was increased to approximately  100,000
barrels per day in July 2002.

     At its Catlettsburg, Kentucky refinery, MAP has initiated a multi-year
integrated  investment  program to upgrade product yield  realizations  and
reduce fixed and variable manufacturing expenses. This program involves the
expansion,  conversion and retirement of certain refinery  processing units
which, in addition to improving  profitability,  will reduce the refinery's
total gasoline pool sulfur below 30 parts per million,  thereby eliminating
the need for low sulfur  gasoline  compliance  investments at the refinery.
The project is expected to be completed in late 2003.

MARKETING

     MAP's principal  marketing areas for gasoline and distillates  include
the Midwest,  the upper Great Plains and the  southeastern  United  States.
Gasoline  and  distillates  are  sold  in 21  states.  Gasoline  is sold at
wholesale primarily to independent  marketers,  jobbers and chain retailers
who resell these products through several thousand retail outlets. MAP also
supplies  approximately 3,800 jobber-dealer,  open-dealer and lessee-dealer
locations using the Marathon(R) and Ashland(R) brand names.

     Gasoline,   distillates  and  aviation   products  are  also  sold  to
utilities,  railroads, river towing companies,  commercial fleet operators,
airlines and  governmental  agencies.  About half of MAP's  propane is sold
into the home heating  markets and the balance is  purchased by  industrial
consumers.  Propylene,  cumene,  aromatics,   aliphatics,  and  sulfur  are
marketed to customers in the  chemical  industry.  Base lube oils and slack
wax are sold throughout the United States. Pitch is also sold domestically,
but  approximately  10% of pitch products are exported into growing markets
in Canada, Mexico, India, and South America.

     MAP  markets  asphalt  through  owned  and  leased  terminals  located
throughout  the Midwest  and  Southeast.  The MAP  customer  base  includes
approximately 900 asphalt paving contractors,  government entities (states,
counties, cities and townships) and asphalt roofing shingle manufacturers.


                                     5

<PAGE>

     Retail  sales of  gasoline  and  diesel  fuel are made  through  MAP's
wholly-owned subsidiary, Speedway SuperAmerica LLC ("SSA"). As of September
30,  2002,  SSA had 2,063  retail  outlets in 13 states in the  Midwest and
Southeast which sell petroleum  products and convenience  store merchandise
primarily under the brand names Speedway(R) and SuperAmerica(R). The retail
locations  sell a  variety  of food,  merchandise,  cigarettes,  candy  and
beverages.  Several locations also have on-premises  brand-name restaurants
such as Subway(R) and Taco Bell(R).

     During  the twelve  months  ended  September  30,  2002,  57% of SSA's
revenues  (excluding  excise  taxes) were derived from the sale of gasoline
and  diesel  fuel,  and  the  remainder  were  derived  from  the  sale  of
merchandise.

     Pilot  Travel  Centers  LLC  ("PTC"),   a  joint  venture  with  Pilot
Corporation  ("Pilot"),  is the largest  operator of travel  centers in the
United States with  approximately  230  locations in 35 states.  The travel
centers  offer  diesel  fuel,  gasoline  and a  variety  of other  services
associated   with  such   locations,   including   on-premises   brand-name
restaurants. Pilot and MAP each own a 50% interest in PTC.

     The table below shows the volume of MAP's consolidated refined product
sales for the twelve months ended September 30, 2002, 2001 and 2000.
<TABLE>
<CAPTION>
                                                                 Twelve Months Ended September 30
                                                     ---------------------------------------------------------
    <S>                                                       <C>               <C>              <C>
                                                              2002              2001             2000
                                                              ----              ----             ----
     Refined Product Sales
     (in thousands of barrels per day)
     ---------------------------------
         Gasoline..........................                   774.3             741.0            752.1
         Distillates.......................                   345.7             349.6            351.2
         Propane...........................                    22.7              21.5             21.6
         Feedstocks & Special Products ....                    80.3              68.1             67.6
         Heavy Fuel Oils...................                    22.0              46.3             40.9
         Asphalt...........................                    76.2              75.8             75.1
                                                            -------           -------          -------
                             Total.........                 1,321.2           1,302.3          1,308.5
                                                            =======           =======          =======

     Matching Buy/Sell Volumes
     included in above.....................                    69.3              43.7             41.4

</TABLE>

     MAP sells RFG in parts of its marketing territory,  primarily Chicago,
Illinois;   Louisville,   Kentucky;   Northern  Kentucky;   and  Milwaukee,
Wisconsin. MAP also markets low-vapor-pressure gasolines in nine states.

SUPPLY AND TRANSPORTATION

     The  crude  oil  processed  in  MAP's   refineries  is  obtained  from
negotiated contract and spot purchases or exchanges.  For the twelve months
ended September 30, 2002, MAP's negotiated  contract and spot purchases for
refinery input of crude oil produced in the U.S.  averaged  454,800 barrels
per day,  including an average of 46,900 net barrels per day acquired  from
Marathon.  For the twelve months ended  September  30, 2002,  MAP's foreign
crude oil  requirements  were met largely  through  purchases  from various
foreign national oil companies,  producing companies and traders. Purchases
of foreign crude oil  represented 51% of MAP's crude oil  requirements  for
the twelve months ended September 30, 2002.

     MAP's  ownership  or  interest  in  domestic  pipeline  systems in its
refining and marketing  areas is  significant.  MAP owns,  leases or has an
ownership  interest in 7,160 miles of pipelines in 12 states.  This network
transports crude oil and refined products to and from terminals, refineries
and other  pipelines.  It includes 10 miles of crude oil  gathering  lines,
3,410  miles of crude oil trunk  lines and 3,740  miles of refined  product
lines.

     MAP has a 46.7% ownership interest in LOOP LLC ("LOOP"),  which is the
owner and  operator of the only U.S.  deepwater  port  facility  capable of
receiving crude oil from very large crude carriers.  Ashland has retained a
4% ownership  interest in LOOP. MAP also owns a 49.9% ownership interest in
LOCAP  INC.  ("LOCAP"),  which is the  owner  and  operator  of a crude oil
pipeline  connecting  LOOP to the Capline  system.  Ashland has retained an
8.6% ownership  interest in LOCAP.  In addition,  MAP has a 37.2% ownership
interest in the Capline system. These port and pipeline systems provide MAP
with access to common carrier  transportation from the Louisiana Gulf Coast
to Patoka,  Illinois.  At Patoka,  the Capline  system  connects with other
common carrier pipelines owned by MAP that provide  transportation to MAP's
refineries in Illinois, Kentucky, Michigan, Minnesota and Ohio.

     Ohio River Pipe Line LLC ("ORPL"),  a subsidiary of MAP, is building a
pipeline  from Kenova,  West Virginia to Columbus,  Ohio.  ORPL is a common
carrier  pipeline  company and the pipeline  will be an  interstate  common
carrier pipeline. The pipeline is currently known as Cardinal Products Pipe
Line and is  expected to  initially  move about  50,000  barrels per day of
refined petroleum into the central Ohio region. ORPL has secured all of the
rights-

                                     6

<PAGE>


of-way  required to build the pipeline,  and the final permits  required to
build the pipeline have been approved.  Construction  on the pipeline began
in August 2002, with start-up of the pipeline expected in the first half of
2003.

     MAP has been  designated  operator of the Centennial  Pipeline,  owned
jointly by Panhandle Eastern Pipe Line Company,  a subsidiary of CMS Energy
Corporation,  MAP, and TE Products Pipe Line Company,  Limited Partnership.
The new pipeline  system,  which  connects the Gulf Coast refiners with the
Midwest market, has the initial capacity to transport approximately 210,000
barrels  per day of refined  petroleum  products  and began  deliveries  of
refined products in April 2002.

     MAP  also  has a 33.3%  ownership  interest  in  Minnesota  Pipe  Line
Company,  which operates a crude oil pipeline in Minnesota.  Minnesota Pipe
Line  Company  provides  MAP  with  access  to  crude  oil  common  carrier
transportation  from Clearbrook,  Minnesota,  to Cottage Grove,  Minnesota,
which is in the vicinity of MAP's St. Paul Park, Minnesota refinery.

     MAP's marine  transportation  operations  include  towboats and barges
that  transport  refined  products on the Ohio,  Mississippi  and  Illinois
rivers,  their tributaries and the Intracoastal  Waterway.  MAP also leases
and owns railcars in various sizes and  capacities for movement and storage
of petroleum  products and a large  number of tractors,  tank  trailers and
general service trucks.

     In addition,  MAP owns and operates 88 terminal  facilities from which
it sells a wide range of petroleum products.  These facilities are supplied
by a combination of barges, pipeline, truck and/or rail.

OTHER MATTERS

     For  information  on MAP and  federal,  state and local  statutes  and
regulations  governing  releases into the  environment or protection of the
environment, see "Item 1. Business - Miscellaneous - Environmental Matters"
in this Form 10-K.

                                  MISCELLANEOUS
ENVIRONMENTAL MATTERS

     Ashland has implemented a company-wide  environmental  policy overseen
by the  Public  Policy -  Environmental  Committee  of  Ashland's  Board of
Directors.  Ashland's Environmental,  Health and Safety ("EH&S") department
has the  responsibility to ensure that Ashland's  operating groups maintain
environmental   compliance  in   accordance   with   applicable   laws  and
regulations.  This  responsibility is carried out via training;  widespread
communication  of  EH&S  policies,   information  and  regulatory  updates;
formulation of relevant policies, procedures and work practices; design and
implementation  of  EH&S  management  systems;   internal  auditing  by  an
independent  auditing  group  within  the EH&S  department;  monitoring  of
regulatory developments that may affect Ashland's operations; assistance to
the operating divisions in identifying  compliance issues and opportunities
for  voluntary  actions that go beyond  compliance;  and incident  response
planning and implementation.

     Federal,  state  and  local  laws  and  regulations  relating  to  the
protection  of the  environment  have a  significant  impact on how Ashland
conducts its  businesses.  New laws are being enacted and  regulations  are
being adopted by various regulatory agencies on a continuing basis, and the
costs of  compliance  with these new rules  cannot be  estimated  until the
manner in which they will be implemented has been more accurately  defined.
In addition, most foreign countries in which Ashland conducts business have
laws dealing with similar matters.

     At  September   30,  2002,   Ashland's   reserves  for   environmental
remediation amounted to $169 million, reflecting Ashland's estimates of the
most  likely  costs  that  will be  incurred  over an  extended  period  to
remediate  identified   conditions  for  which  the  costs  are  reasonably
estimable,  without  regard to any  third-party  recoveries.  Environmental
remediation  reserves are subject to numerous inherent  uncertainties  that
affect  Ashland's  ability  to  estimate  its  share  of  the  costs.  Such
uncertainties  involve the nature and extent of contamination at each site,
the  extent  of  required  cleanup  efforts  under  existing  environmental
regulations,  widely varying costs of alternate cleanup methods, changes in
environmental regulations,  the potential effect of continuing improvements
in remediation  technology,  and the number and financial strength of other
potentially  responsible  parties at multiparty  sites.  Ashland  regularly
adjusts its reserves as environmental  remediation  continues.  None of the
remediation  locations is  individually  material to Ashland as its largest
reserve  for any site is less  than $10  million.  As a  result,  Ashland's
exposure to adverse developments with respect to any individual site is not
expected to be material,  and these sites are in various  stages of ongoing
remediation.  Although  environmental  remediation  could  have a  material
effect on results of operations if a series of adverse  developments occurs
in a particular quarter or fiscal year, Ashland believes that the chance of
such developments occurring in the same quarter or fiscal year is remote.

     In  connection  with the  formation of MAP,  Marathon and Ashland each
retained  responsibility  for certain  environmental  costs  arising out of
their   respective   prior   ownership  and  operation  of  the  facilities
transferred to MAP.

                                     7

<PAGE>


In certain situations,  various threshold provisions apply,  eliminating or
reducing  the  financial  responsibility  of the  contributing  party until
certain  levels of  expenditure  have been  reached.  In other  situations,
sunset provisions gradually diminish the level of financial  responsibility
of the contributing party over time.

     AIR - The Clean Air Act (the "CAA")  imposes  stringent  limits on air
emissions,  establishes a federally mandated operating permit program,  and
allows  for  civil  and  criminal  enforcement  actions.  Additionally,  it
establishes air quality attainment deadlines and control requirements based
on the severity of air  pollution  in a given  geographical  area.  Various
state clean air acts implement,  complement and, in some instances,  add to
the  requirements  of the federal CAA. The  requirements of the CAA and its
state  counterparts  have a  significant  impact on the daily  operation of
Ashland's  businesses and, in many cases, on product  formulation and other
long-term  business  decisions.   Ashland's  businesses  maintain  numerous
permits  pursuant to these clean air laws and have  implemented  systems to
oversee ongoing compliance efforts.

     In July  1997,  the  United  States  Environmental  Protection  Agency
("EPA") promulgated revisions to the National Ambient Air Quality Standards
("NAAQS") for ground level ozone and particulate  matter.  As written,  the
revisions could have a significant  effect on certain of Ashland's chemical
manufacturing  and distribution  businesses,  and on MAP. In 2001, the U.S.
Supreme Court upheld the EPA's  authority to set NAAQS without  considering
the costs  related to  compliance.  In early  2002,  the  Washington,  D.C.
District Court of Appeals upheld EPA's proposed revisions to the NAAQS. EPA
has begun to implement  the new ozone and  particulate  matters  standards,
which could result in areas of the country,  where  Ashland and MAP conduct
operations,  being  designated as not in compliance  with the NAAQS.  Until
these  revisions  have been more  fully  implemented,  it is not  currently
possible  to  estimate  any  potential  financial  impact  that the revised
standards may have on Ashland's or MAP's operations.

     WATER - Ashland's  businesses  maintain numerous discharge permits, as
the National Pollutant Discharge  Elimination System of the Clean Water Act
("CWA") and state programs require, and have implemented systems to oversee
their compliance  efforts.  In addition,  several of MAP's  operations,  in
particular its barge and terminal  facilities,  are regulated under the Oil
Pollution Act of 1990.

     SOLID  WASTE  -  Ashland's  businesses  are  subject  to the  Resource
Conservation and Recovery Act ("RCRA"), which establishes standards for the
management of solid and hazardous  wastes.  Besides affecting current waste
disposal  practices,  RCRA also  addresses  the  environmental  effects  of
certain past waste  disposal  operations,  the  recycling of wastes and the
storage of regulated substances in underground tanks.

     REMEDIATION  -  Ashland  currently  operates,  and  in  the  past  has
operated,  various  facilities where,  during the normal course of business
releases of hazardous  substances  have  occurred.  Federal and state laws,
including  but not limited to RCRA and various  remediation  laws,  require
that  contamination  caused by such releases be assessed and, if necessary,
remediated to meet applicable standards.  MAP operates, and in the past has
operated,  certain  retail  outlets  where,  during  the  normal  course of
business releases of petroleum products from underground storage tanks have
occurred.  Federal and state laws require that contamination caused by such
releases at these sites be assessed and, if  necessary,  remediated to meet
applicable standards.

RESEARCH

     Ashland  conducts a program of research and  development to invent and
improve  products and processes and to improve  environmental  controls for
its existing  facilities.  It maintains its research  facilities in Dublin,
Ohio; Lexington,  Kentucky; and Atlanta,  Georgia. Research and development
costs are  expensed as they are  incurred and totaled $38 million in fiscal
2002 ($36 million in 2001 and $33 million in 2000).

COMPETITION

     In all its operations,  Ashland is subject to intense competition both
from  companies in the industries in which it operates and from products of
companies in other industries.

     The majority of the  business  for which APAC  competes is obtained by
competitive  bidding.  There are a substantial number of competitors in the
markets in which APAC  operates  and, as a result,  all of APAC's goods and
services are marketed under highly  competitive  conditions.  Factors which
influence APAC's  competitiveness  are price,  reputation for quality,  the
availability of aggregate materials,  machinery and equipment, knowledge of
local markets and conditions and estimating abilities.

     Each of Ashland  Distribution's  businesses,  except for the  plastics
distribution  businesses,   compete  with  national,   regional  and  local
companies  throughout North America. The plastics  distribution  businesses
compete in both North America and Europe.  Competition in these  businesses
is based  primarily on price and reliability of supply.  Ashland  Specialty
Chemical's  businesses compete globally in selected niche markets,  largely
on the basis of technology  and service.  The number of  competitors in the
specialty  chemical business varies from product to product,  and it is not

                                     8

<PAGE>

practical  to  identify  such  competitors  because  of the broad  range of
products and markets  served by those  products.  However,  many of Ashland
Specialty Chemical's  businesses hold proprietary  technology,  and Ashland
believes  it has a  leading  or  strong  market  position  in  most  of its
specialty chemical products.  Ashland Specialty  Chemical's  petrochemicals
business is largely a commodities business,  with pricing and quality being
the most important factors.

     Valvoline  competes  in the  highly  competitive  lubricants  business
principally through product and service quality, distribution capability, a
focused "master" brand strategy,  advertising and sales promotion.  Some of
the major  brands of motor  oils and  lubricants  Valvoline  competes  with
internationally  are  Havoline(R),   Castrol(R),   Pennzoil(R)  and  Quaker
State(R).  The highly  competitive  consumer  products car care business is
primarily composed of maintenance  chemicals,  appearance products and tire
cleaners.  Valvoline  competes  primarily in this market  through  specific
product performance benefits,  distribution  capability and advertising and
sales  promotion.  In the highly  competitive  "fast oil change"  business,
Valvoline  competes  with other leading  independent  fast lube chains on a
national,  regional  or local  basis,  as well as  automobile  dealers  and
service  stations.  Valvoline's  brand  recognition,  service  offering and
increasing market presence in the U.S. "fast oil change" market, as well as
quality of service, speed, location,  convenience and sales promotion,  are
important competitive factors.

     MAP competes with a large number of companies to acquire crude oil for
refinery  processing and in the  distribution and marketing of a full array
of  petroleum  products.  MAP  believes  it  ranks  among  the top ten U.S.
petroleum  companies  on the basis of crude  oil  refining  capacity  as of
September 30, 2002.  MAP competes in four distinct  markets for the sale of
refined products - wholesale,  spot, branded and retail  distribution.  MAP
believes it competes  with  approximately  40  companies  in the  wholesale
distribution  of petroleum  products to private  brand  marketers and large
commercial and industrial consumers; approximately 80 companies in the sale
of   petroleum   products   in   the   spot   market;    approximately   10
refiner/marketers  in the supply of branded  petroleum  products to dealers
and jobbers;  and  approximately  600  petroleum  product  retailers in the
retail sale of petroleum  products.  MAP also  competes in the  convenience
store  industry  through  SSA's  retail  outlets  and in the travel  center
industry through their ownership in PTC. The retail outlets offer consumers
gasoline,  diesel  fuel (at  selected  locations)  and a  variety  of food,
merchandise, cigarettes, candy and beverages.

FORWARD-LOOKING STATEMENTS

     This Form 10-K and the  documents  incorporated  by reference  contain
forward-looking  statements  within  the  meaning  of  Section  27A  of the
Securities  Act of 1933 and Section 21E of the  Securities  Exchange Act of
1934,   including  various  information  within  the  "Capital  Resources,"
"Application of Critical Accounting Policies," "Derivative Instruments" and
"Outlook"  sections in  Management's  Discussion  and Analysis in Ashland's
Annual  Report.  Words  such  as  "anticipates,"  "believes,"  "estimates,"
"expects,"  "is  likely,"  "predicts,"  and  variations  of such  words and
similar   expressions   are  intended  to  identify  such   forward-looking
statements.  Although  Ashland  believes that its expectations are based on
reasonable assumptions, it cannot assure that the expectations contained in
such  statements  will be  achieved.  Important  factors  which could cause
actual results to differ materially from those contained in such statements
are  discussed  under  "Risks  and  Uncertainties"  in Note A of  Notes  to
Consolidated  Financial  Statements  in  Ashland's  Annual  Report.  For  a
discussion  of other  factors and risks  affecting  Ashland's  revenues and
operations see "Item 1. Business -  Miscellaneous  - Marketing  Conditions"
below.

MARKETING CONDITIONS

     Domestic and  international  political,  legislative,  regulatory  and
legal  changes  may  adversely  affect  Ashland's  results  of  operations.
Political  actions may include changes in the policies of the  Organization
of  Petroleum  Exporting  Countries  or  other  developments  involving  or
affecting oil-producing countries,  including military conflict, embargoes,
internal  instability  or actions or  reactions of the U.S.  government  in
anticipation  of, or in response  to, such  actions.  Profitability  of MAP
depends  largely  on the  margin  between  the cost of crude  oil and other
feedstocks  refined and the selling  prices of refined  products.  MAP is a
purchaser  of  crude  oil in  order  to  satisfy  its  refinery  throughput
requirements.  As a result, MAP's overall  profitability could be adversely
affected by increases in crude oil and other feedstock  prices that are not
recovered in the market place through  higher prices.  Reference  should be
made to the Refining and Marketing  section of the Management's  Discussion
and Analysis  section in Ashland's  Annual  Report for a discussion  of the
impact of crude oil costs on MAP's  operating  performance.  While  Ashland
maintains  reserves for anticipated  liabilities and carries various levels
of insurance,  Ashland could be affected by civil, criminal,  regulatory or
administrative  proceedings and claims relating to asbestos,  environmental
remediation and other matters.

     Ashland's  operations are subject to various U.S. and foreign laws and
regulations  relating to  environmental  protection  and worker  health and
safety.  These laws and regulations  regulate discharges of pollutants into
the air and water, the management and disposal of hazardous substances, and
the cleanup of contaminated  properties.  The costs

                                     9

<PAGE>


of complying with these laws and  regulations  can be  substantial  and may
increase as applicable requirements become more stringent and new rules are
implemented.  If violation of these laws and regulations occur, Ashland may
be forced to pay substantial fines, to complete additional costly projects,
or to modify or curtail its operations to limit contaminant emissions.

     The profitability of Ashland's businesses are particularly susceptible
to downturns in the economy,  particularly downturns in the segments of the
U.S.  economy related to the purchase and sale of durable goods,  including
housing, construction,  automotive, marine and semiconductor.  Both overall
demand for  Ashland's  products  and its profit  margins  may  decline as a
direct result of an economic recession, inflation, changes in the prices of
hydrocarbons  and other raw  materials  (e.g.,  crude oil and petroleum and
chemical  products),  consumer  confidence,  interest rates or governmental
fiscal  policies.  In  addition,  Ashland's  profitability  may  experience
significant changes as a result of variations in sales,  changes in product
mix or pricing competition.

     In addition,  changes in climate and weather can significantly  affect
the performance of several of Ashland's operations. Extreme variations from
normal climatic conditions could have a significant effect on the operating
results  of APAC's  construction  operations.  In  particular,  unfavorable
weather conditions will delay the completion of construction  projects, and
may require  the use of  additional  resources.  In  addition,  most of the
refined  products  sold by MAP are seasonal in nature,  and thus demand for
those products may decline due to significant changes in prevailing climate
and weather  conditions.  MAP's  production or distribution  operations are
also subject to disruption by extreme  weather  conditions  such as floods,
frozen rivers or hurricanes.

ITEM 2. PROPERTIES

     Ashland's  corporate  headquarters,  which is  leased,  is  located in
Covington,  Kentucky.  Principal  offices  of other  major  operations  are
located in Atlanta,  Georgia (APAC); Dublin, Ohio (Ashland Distribution and
Ashland Specialty Chemical);  Lexington, Kentucky (Valvoline); and Russell,
Kentucky (Administrative Services). All of these offices are leased, except
for the Russell office, which is owned. Principal manufacturing,  marketing
and other  materially  important  physical  properties  of Ashland  and its
subsidiaries  are described under the  appropriate  segment under Item 1 in
this Form 10-K.  Additional  information  concerning  certain leases may be
found in Note F of Notes to Consolidated  Financial Statements in Ashland's
Annual Report.

ITEM 3. LEGAL PROCEEDINGS

     ENVIRONMENTAL PROCEEDINGS - As of September 30, 2002, Ashland has been
identified as a "potentially  responsible party" ("PRP") under Superfund or
similar state laws for potential  joint and several  liability for clean-up
costs  in  connection  with  alleged   releases  of  hazardous   substances
associated  with 97 waste  treatment  or  disposal  sites.  These sites are
currently  subject  to  ongoing   investigation  and  remedial  activities,
overseen  by the EPA or a state  agency,  in  which  Ashland  is  typically
participating  as a member of a PRP  group.  Generally,  the type of relief
sought  includes  remediation  of  contaminated  soil  and/or  groundwater,
reimbursement for past costs of site clean-up and administrative oversight,
and/or long-term  monitoring of environmental  conditions at the sites. The
ultimate  costs are not  predictable  with assurance and could be material.
However, based on its experience with site remediation, its analysis of the
specific hazardous  substances at issue, the existence of other financially
viable  PRPs and its  current  estimates  of  investigatory,  clean-up  and
monitoring costs at each site,  Ashland does not believe that any liability
at these  sites,  either  individually  or in the  aggregate,  will  have a
material adverse effect on Ashland's consolidated financial position,  cash
flows or liquidity.  For information  regarding  environmental  matters and
Ashland's  reserves  for  environmental   remediation,   see  "Management's
Discussion  and Analysis - Application  of Critical  Accounting  Policies -
Environmental  Remediation"  and Note M of Notes to Consolidated  Financial
Statements in Ashland's Annual Report and "Item 1. Business - Miscellaneous
- Environmental Matters" in this Form 10-K.

     ASBESTOS-RELATED  LITIGATION - Ashland is subject to liabilities  from
claims  alleging  personal  injury  caused by exposure to  asbestos.  Those
claims result primarily from indemnification obligations undertaken in 1990
in connection with the sale of Riley Stoker Corporation ("Riley"), a former
subsidiary.  Although  Riley was neither a producer nor a  manufacturer  of
asbestos,   its  industrial  boilers  contained  some   asbestos-containing
components produced by other companies.

                                    10

<PAGE>


     A summary of asbestos  claims  activity  follows.  Because  claims are
frequently  filed and  settled  in large  groups,  the amount and timing of
settlements,  and the number of open claims,  can  fluctuate  significantly
from period to period.  Over the last 17 years, Riley has been dismissed as
a defendant in 55% of the resolved claims.

<TABLE>
<CAPTION>
                                                                2002            2001             2000
                                                                ----            ----             ----
     <S>                                                        <C>              <C>              <C>
     (In thousands)

     Open claims - beginning of year.......                      167             118               93
     New claims filed......................                       45              52               37
     Claims settled........................                      (15)             (2)              (9)
     Claims dismissed......................                      (37)             (1)              (3)
                                                                ----            ----             ----
     Open claims - end of year............                       160             167              118
                                                                ====            ====             ====

</TABLE>

     Amounts spent on litigation defense and claim settlements  totaled $38
million in 2002,  $15  million in 2001 and $11  million in 2000.  Insurance
provides  reimbursements  for most of these  costs,  and  coverage-in-place
agreements exist with the insurance carriers that provide substantially all
of  the  coverage  that  is  currently  being  accessed.  The  amounts  not
recoverable are generally due from insurers that are insolvent, rather than
as a  result  of  uninsured  claims  or the  exhaustion  of  the  insurance
coverage.

     In previous years,  Ashland recognized a net reserve for the estimated
litigation  defense and claim  settlement  costs to settle open claims that
would not be recovered  from insolvent  insurance  carriers.  However,  the
reserve  and  related  receivable  are now  presented  on a gross  basis in
Ashland's  consolidated  balance sheet at September 30, 2001, to conform to
the 2002  presentation.  This  change did not result  from an  increase  in
expected   asbestos   exposure,   and  had  no  effect  on  net  income  or
stockholders'  equity.  Under this  presentation,  the reserve for asbestos
claims  amounted to $202 million at September 30, 2002, and $199 million at
September  30,  2001.  Such  reserve  reflects  the  estimated  costs on an
undiscounted basis that will be incurred over an extended period to resolve
open claims.  In addition,  the  receivable  for  recoveries  of litigation
defense and claim settlement  costs from insurers  amounted to $196 million
at September 30, 2002, and $178 million at September 30, 2001.

     The reserve for asbestos  claims is based on assumptions and estimates
derived from currently known facts. However, projecting future events, such
as the average  cost of resolving  the open claims,  is subject to numerous
variables that are extremely difficult to predict.  These variables include
the type and severity of the disease  alleged by each  claimant,  dismissal
rates,  future costs of medical  treatment,  the impact of  bankruptcies of
other companies that are co-defendants in claims, uncertainties surrounding
the litigation  process from  jurisdiction to jurisdiction and from case to
case,  and the impact of  potential  changes  in  legislative  or  judicial
standards.

     Ashland  believes that  insurance will cover the majority of the costs
that will be incurred on open and future asbestos  claims.  Equitas Limited
("Equitas") and other London companies  currently  provide about 59% of the
insurance  coverage,  and this percentage could decline over time to around
44% if higher  layers of  coverage  provided by other  carriers  have to be
accessed.  The remaining 41% of the coverage is currently  provided by five
companies,  all of which  are  rated A or  higher  by A. M.  Best  Company.
Depending  upon the  level  of costs  that  are  ultimately  incurred,  the
non-London coverage could ultimately expand to about 25 insurance companies
or groups.  Companies or groups that provide about 90% of this coverage are
also rated A or higher.

     Ashland has not recognized a reserve for future  asbestos  claims that
may be asserted.  Although  additional claim filings are expected,  Ashland
does not have sufficient  information to make a reasonable  estimate of the
number of new claims  that  might be filed.  Furthermore,  any  predictions
about the other variables discussed  previously are subject to even greater
uncertainty as the projection  period  lengthens.  Ashland has retained the
services of professional advisors to assist management in the estimation of
projected liabilities and probable insurance recoveries for future asbestos
claims.  Results of that  effort are  expected to be  available  during the
quarter ending March 31, 2003.

     Although  coverage  limits  are  resolved  in  the   coverage-in-place
agreement  with  Equitas  and  the  other  London  companies,  there  is  a
disagreement with these companies over the timing of recoveries.  Depending
upon the assumptions made with respect to the projected  payments to settle
future  claims,  an  unfavorable  resolution  of  this  disagreement  could
materially affect the present value of additional insurance recoveries from
those companies.  Until such time as this disagreement is resolved, Ashland
will use the less favorable  interpretation of this agreement in estimating
such insurance recoveries.

     SHAREHOLDER  DERIVATIVE  LITIGATION  - On  August  16,  2002,  Central
Laborers'   Pension  Fund,   derivatively  as  a  shareholder  of  Ashland,
instituted  an action in the Circuit  Court of  Kentucky  in Kenton  County
against Ashland's then-serving Board of Directors. On motion of Ashland and
the other defendants, the case was removed to the

                                    11

<PAGE>

United  States  District  Court,  Eastern  District of Kentucky,  Covington
Division.  Plaintiff  has moved to remand the case to the state court.  The
action is purportedly filed on behalf of Ashland, and asserts the following
causes of action against the Directors:  breach of fiduciary duty, abuse of
control, gross mismanagement,  and waste of corporate assets. The suit also
names Paul W.  Chellgren,  the  then-serving  Chief  Executive  Officer and
Chairman of the Board, and James R. Boyd,  former Senior Vice President and
Group Operating Officer, as individual defendants,  and it seeks to recover
an unstated sum from them  individually  alleging  unjust  enrichment  from
various  transactions  completed during their tenure with Ashland. The suit
further seeks an unspecified sum from Mr. Chellgren individually based upon
alleged usurpation of corporate  opportunities.  The suit also names Mr. J.
Marvin Quin,  Ashland's  Chief Financial  Officer,  as well as three former
employees  of  Ashland's  wholly-owned  subsidiary,   APAC,  as  individual
defendants and alleges that they participated in the preparation and filing
of false  financial  statements  during fiscal years 1999 - 2001.  The suit
further  names  Ernst  &  Young  LLP  ("E&Y"),  as  a  defendant,  alleging
professional  accounting  malpractice  and negligence in the conduct of its
audit of Ashland's 1999 and 2000  financial  statements,  respectively,  as
well as alleging  that E&Y aided and abetted the  individual  defendants in
their alleged breach of duties. The complaint seeks to recover, jointly and
severally,  from  defendants an unstated sum of  compensatory  and punitive
damages.  The complaint seeks equitable and/or  injunctive  relief to avoid
continuing harm from alleged ongoing illegal acts, and seeks a disgorgement
of defendants' alleged insider-trading gains, in addition to the reasonable
cost and expenses incurred in bringing the complaint,  including attorneys'
and experts' fees.

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

     No matters were submitted to a vote of security  holders,  through the
solicitation  of proxies or otherwise,  during the quarter ended  September
30, 2002.

ITEM X.  EXECUTIVE OFFICERS OF ASHLAND

     The following is a list of Ashland's  executive  officers,  their ages
and  their  positions  and  offices  during  the last  five  years  (listed
alphabetically  after the Chief  Executive  Officer as to other Senior Vice
Presidents, Administrative Vice Presidents and other executive officers).

     JAMES J.  O'BRIEN (age 48) is Chairman of the Board,  Chief  Executive
Officer and  Director of Ashland  and has served in such  capacities  since
November  15,  2002,  October 1, 2002 and August  13,  2002,  respectively.
During  the  past  five  years,  he has also  served  as  President,  Chief
Operating  Officer,  Senior Vice President and Group  Operating  Officer of
Ashland and President of The Valvoline Company.

     PAUL W. CHELLGREN (age 59) was Ashland's  Chairman of the Board, Chief
Executive  Officer and a Director of Ashland - positions  he had held since
1997, 1996 and 1992, respectively. Mr. Chellgren retired as Chief Executive
Officer on October 1, 2002,  and as Chairman  of the Board and  Director on
November 15, 2002.

     DAVID  J.  D'ANTONI  (age  57) is  Senior  Vice  President  and  Group
Operating  Officer of Ashland and has served in such capacities  since 1988
and 1999,  respectively.  During the past five years, he has also served as
President of Ashland Chemical Company.

     CHARLES F.  POTTS (age 58) is Senior  Vice  President  of Ashland  and
President of APAC, Inc. and has served in such capacities since 1992.

     J. MARVIN QUIN (age 55) is Senior Vice  President and Chief  Financial
Officer of Ashland and has served in such capacities since 1992.

     KENNETH  L.  AULEN  (age  53) is  Administrative  Vice  President  and
Controller of Ashland and has served in such capacities since 1992.

     GARY A.  CAPPELINE (age 53) is Vice President of Ashland and President
of Ashland Specialty  Chemical Company  effective  December 4, 2002. During
the last five years, he has also served as a chemical  industry  partner at
Bear Stearns Merchant Bank,  President of AlliedSignal  Specialty Chemicals
and Group Vice President, Pigments and Additives of Engelhard Corp.

     JAMES A. DUQUIN (age 55) was Vice  President of Ashland and  President
of Ashland  Specialty  Chemical Company - positions he had held since 1999.
During  the past five  years,  he also  served as Group  Vice  President  -
Specialty  Chemical  Division  of  Ashland  Chemical  Company.  Mr.  DuQuin
resigned as Vice  President of Ashland and  President of Ashland  Specialty
Chemical  Company on November  25,  2002 and will  retire  from  Ashland on
December 31, 2002.

                                    12

<PAGE>

     DAVID L.  HAUSRATH (age 50) is Vice  President and General  Counsel of
Ashland   and  has  served  in  such   capacities   since  1998  and  1999,
respectively.  During the past five years,  he has also served as Associate
General Counsel of Ashland.

     J. DAN LACY (age 55) is Vice President - Corporate  Affairs of Ashland
and has served in such capacity since 1986.

     SAMUEL J. MITCHELL (age 41) is Vice President of Ashland and President
of The Valvoline  Company and has served in such  capacities  since January
2002.  During the past five years,  he has also served as Vice  President -
Retail  Business,  Vice  President of Marketing and Director of Marketing -
The Valvoline Company.

     RICHARD P. THOMAS (age 56) is Vice  President and Secretary of Ashland
and has served in such capacities since 1998 and 1999, respectively.

     FRANK L. WATERS (age 41) is Vice President of Ashland and President of
Ashland  Distribution  Company  and has  served  in such  capacities  since
January  2002.  During  the past  five  years,  he has also  served as Vice
President  of Ashland  Plastics  - Europe,  Director  of Sales for  Ashland
Distribution's  Fine  Ingredients  Division and an  Executive  Assistant of
Ashland.

     Each executive officer is elected by the Board of Directors of Ashland
to a term of one  year,  or until his  successor  is duly  elected,  at the
annual meeting of the Board of Directors,  except in those  instances where
the  officer  is elected  other  than at an annual  meeting of the Board of
Directors,  in which case his tenure will expire at the next annual meeting
of the Board of Directors unless the officer is re-elected.

                                  PART II

ITEM 5. MARKET FOR  REGISTRANT'S  COMMON STOCK AND RELATED  SECURITY HOLDER
MATTERS

     There is hereby incorporated by reference the information appearing in
Note P of Notes to Consolidated  Financial  Statements in Ashland's  Annual
Report.

     At September  30, 2002,  there were  approximately  17,700  holders of
record of Ashland's Common Stock. Ashland Common Stock is listed on the New
York and  Chicago  stock  exchanges  (ticker  symbol  ASH) and has  trading
privileges  on the  Boston,  Cincinnati,  Pacific  and  Philadelphia  stock
exchanges.

ITEM 6.  SELECTED FINANCIAL DATA

     There is hereby  incorporated by reference the  information  appearing
under the caption "Five-Year Selected Financial  Information" on page 62 in
Ashland's Annual Report.

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

     There is hereby  incorporated by reference the  information  appearing
under the caption "Management's  Discussion and Analysis" on pages 32 to 41
in Ashland's Annual Report.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     There is hereby  incorporated by reference the  information  appearing
under the caption  "Derivative  Instruments" on page 40 in Ashland's Annual
Report.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     There is hereby  incorporated by reference the consolidated  financial
statements appearing on pages 43 through 61 in Ashland's Annual Report.

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

     None.

                                  PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     There is hereby  incorporated  by reference the  information to appear
under the  caption  "Ashland  Inc.'s  Board of  Directors  -  Nominees  for
Election at the 2003 Annual Meeting" and the information  regarding Section
16 beneficial  ownership reporting compliance in Ashland's definitive Proxy
Statement for its January 30, 2003 Annual  Meeting of  Shareholders,  which
will be filed with the SEC within 120 days after September 30, 2002 ("Proxy
Statement").  See also the list of Ashland's executive officers and related
information  under  "Executive  Officers  of Ashland" in Part I - Item X in
this Form 10-K.

                                    13

<PAGE>

ITEM 11. EXECUTIVE COMPENSATION

     There is hereby  incorporated  by reference the  information to appear
under the captions  "Executive  Compensation,"  "Compensation of Directors"
and  "Miscellaneous - Personnel and Compensation  Committee  Interlocks and
Insider Participation" in Ashland's Proxy Statement.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED SHAREHOLDER MATTERS

     There is hereby  incorporated  by reference the  information to appear
under the caption  "Ashland Common Stock Ownership of Directors and Certain
Officers  of  Ashland"  and the  information  regarding  the  ownership  of
securities of Ashland in Ashland's Proxy Statement.

     The following  table  summarizes the equity  compensation  plans under
which Ashland  Common Stock may be issued as of September 30, 2002.  Except
as disclosed  in the  narrative  to the table,  all plans were  approved by
shareholders of Ashland.

<TABLE>
<CAPTION>

                      EQUITY COMPENSATION PLAN INFORMATION

                                                                                             NUMBER OF SECURITIES
                                                                                            REMAINING AVAILABLE FOR
        PLAN CATEGORY           NUMBER OF SECURITIES TO     WEIGHTED-AVERAGE EXERCISE      FUTURE ISSUANCE UNDER
        -------------           BE ISSUED UPON EXERCISE        PRICE OF OUTSTANDING       EQUITY COMPENSATION PLANS
                                OF OUTSTANDING OPTIONS,        OPTIONS, WARRANTS          (EXCLUDING SECURITIES
                                 WARRANTS AND RIGHTS               AND RIGHTS               REFLECTED IN COLUMN (a))
                                 -------------------               ----------               ----------------------
<S>                                     <C>                           <C>                         <C>
                                            (a)                          (b)                          (c)
Equity compensation plans
approved by security                     6,636,877                     $37.72                     3,727,439
holders.....................

Equity compensation plans
not approved by security
holders (1).................               845,392                     $33.88                             0
                                         ---------                     ------                     ---------
         Total...............            7,482,269                     $37.28                     3,727,439
                                         =========                     ======                     =========


</TABLE>


(1)      The Ashland Inc. Stock Option Plan for Employees of Joint Ventures
         is the only equity  compensation  plan of Ashland not  approved by
         Ashland's shareholders.  This plan was approved by Ashland's Board
         of Directors on September 17, 1998 and is specifically designed to
         grant  stock  options  to  employees  of joint  ventures  in which
         Ashland has an interest.  There are  currently no shares  reserved
         for  future  issuance  under  this  plan.  The Board of  Directors
         authorizes  the  issuance  of the  shares  at the time  the  stock
         options are granted.  A recipient of such stock  options will have
         the right to purchase Ashland Common Stock at a price and on terms
         specified by the Personnel and Compensation Committee of Ashland's
         Board of Directors.  The stock  options  listed in the table above
         have been  granted to certain MAP  employees  and were  registered
         with the SEC.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     There is hereby  incorporated  by reference the  information to appear
under the caption  "Miscellaneous  - Business  Relationships"  in Ashland's
Proxy Statement.

ITEM 14. CONTROLS AND PROCEDURES

(a)      Ashland's Chief Executive Officer and its Chief Financial Officer,
         after  evaluating  the   effectiveness  of  Ashland's   disclosure
         controls and  procedures as of a date within 90 days of the filing
         date of  this  Form  10-K,  have  concluded  that  the  disclosure
         controls and  procedures  were  effective to ensure that  material
         information relating to Ashland and its consolidated  subsidiaries
         was made known to them by others within those entities.

(b)      There were no significant  changes in Ashland's  internal controls
         or in other factors that could significantly affect these controls
         or procedures subsequent to the date of Ashland's evaluation,  nor
         were there any significant  deficiencies or material weaknesses in
         Ashland's  internal  controls.  As a result, no corrective actions
         were required or undertaken.

                                    14

<PAGE>

                                  PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

     (a) Documents filed as part of this Report

     (1) and (2) Financial Statements and Financial Schedule

     The  consolidated  financial  statements  and  financial  schedule  of
Ashland presented or incorporated by reference in this report are listed in
the index on page 20.

     (3) Exhibits

3.1      Third  Restated  Articles of  Incorporation  of Ashland  (filed as
         Exhibit 3 to  Ashland's  Form 10-Q for the quarter  ended June 30,
         2002 and incorporated herein by reference).

3.2      By-laws of Ashland, effective as of November 15, 2002.

4.1      Ashland  agrees  to  provide  the SEC,  upon  request,  copies  of
         instruments  defining the rights of holders of  long-term  debt of
         Ashland  and all of its  subsidiaries  for which  consolidated  or
         unconsolidated  financial statements are required to be filed with
         the SEC.

4.2      Indenture, dated as of August 15, 1989, as amended and restated as
         of August 15, 1990, between Ashland and Citibank, N.A., as Trustee
         (filed as Exhibit 4.2 to  Ashland's  Form 10-K for the fiscal year
         ended September 30, 2001 and incorporated herein by reference).

4.3      Indenture, dated as of September 7, 2001, between Ashland and U.S.
         Bank  National  Association,  as Trustee  (filed as Exhibit 4.3 to
         Ashland's  Form 10-K for the fiscal year ended  September 30, 2001
         and incorporated herein by reference).

4.4      Rights Agreement,  dated as of May 16, 1996,  between Ashland Inc.
         and the  Rights  Agent,  together  with Form of Right  Certificate
         (filed as Exhibit 4.4 to  Ashland's  Form 10-K for the fiscal year
         ended September 30, 2001 and incorporated herein by reference).

     The following  Exhibits 10.1 through 10.15 are  compensatory  plans or
arrangements  or  management  contracts  required  to be filed as  exhibits
pursuant to Item 601(b)(10)(ii)(A) of Regulation S-K.

10.1     Amended Stock Incentive Plan for Key Employees of Ashland Inc. and
         its Subsidiaries (filed as Exhibit 10.1 to Ashland's Form 10-K for
         the fiscal year ended September 30, 1999 and  incorporated  herein
         by reference).

10.2     Ashland  Inc.   Deferred   Compensation   Plan  for   Non-Employee
         Directors.

10.3     Ashland Inc. Deferred Compensation Plan.

10.4     Tenth  Amended  and  Restated  Ashland  Inc.   Supplemental  Early
         Retirement Plan for Certain Employees, as amended.

10.5     Ashland Inc. Salary Continuation Plan.

10.6     Form of Ashland Inc. Executive Employment Contract between Ashland
         Inc. and certain executives of Ashland.

10.7     Form of Separation  Agreement and General  Release between Ashland
         Inc.  and Paul W.  Chellgren,  former Chief  Executive  Officer of
         Ashland.

10.8     Form of  Indemnification  Agreement  between Ashland Inc. and each
         member  of its  Board  of  Directors  (filed  as  Exhibit  10.8 to
         Ashland's  Form 10-K for the fiscal year ended  September 30, 2001
         and incorporated herein by reference).

10.9     Ashland Inc. Nonqualified Excess Benefit Pension Plan.

10.10    Ashland Inc.  Long-Term  Incentive  Plan (filed as Exhibit 10.9 to
         Ashland's  Form 10-K for the fiscal year ended  September 30, 2000
         and incorporated herein by reference).

10.11    Ashland Inc. Directors' Charitable Award Program.

10.12    Ashland Inc. 1993 Stock  Incentive Plan (filed as Exhibit 10.11 to
         Ashland's  Form 10-K for the fiscal year ended  September 30, 2000
         and incorporated herein by reference).

                                    15

<PAGE>


10.13    Ashland Inc. 1995 Performance Unit Plan (filed as Exhibit 10.12 to
         Ashland's  Form 10-K for the fiscal year ended  September 30, 2000
         and incorporated herein by reference).

10.14    Ashland Inc. 1997 Stock Incentive Plan.

10.15    Amended and Restated Ashland Inc. Incentive Plan.

10.16    Amended  and  Restated  Limited  Liability  Company  Agreement  of
         Marathon  Ashland  Petroleum  LLC dated as of  December  31,  1998
         (filed as Exhibit 10.17 to Ashland's Form 10-K for the fiscal year
         ended September 30, 1999 and incorporated herein by reference).

10.17    Put/Call,  Registration Rights and Standstill Agreement as amended
         to December 31, 1998 among Marathon Oil Company,  USX Corporation,
         Ashland  Inc.  and Marathon  Ashland  Petroleum  (filed as Exhibit
         10.18 to Ashland's  Form 10-K for the fiscal year ended  September
         30, 1999 and incorporated herein by reference).

11       Computation  of  Earnings  Per  Share  (appearing  on  page  48 of
         Ashland's Annual Report to Shareholders, incorporated by reference
         herein, for the fiscal year ended September 30, 2002).

12       Computation of Ratio of Earnings to Fixed Charges.

13       Portions of Ashland's Annual Report to Shareholders,  incorporated
         by reference herein, for the fiscal year ended September 30, 2002.

21       List of subsidiaries.

23.1     Consent of independent auditors.

24       Power  of  Attorney,   including   resolutions  of  the  Board  of
         Directors.

99.1     Certificate  of Chief  Executive  Officer of Ashland  pursuant  to
         Section 906 of the Sarbanes-Oxley  Act of 2002, 18 U.S.C.  Section
         1350.

99.2     Certificate  of Chief  Financial  Officer of Ashland  pursuant  to
         Section 906 of the Sarbanes-Oxley  Act of 2002, 18 U.S.C.  Section
         1350.

     Upon written or oral  request,  a copy of the above  exhibits  will be
furnished at cost.

     (b) Reports on Form 8-K

     A report on Form 8-K was filed August 2, 2002,  to report that Paul W.
Chellgren,  Chairman and Chief Executive Officer of Ashland,  announced his
plans to retire effective November 15, 2002.

     A report  on Form 8-K was  filed on  August  7,  2002 to  report  that
Ashland had submitted to the SEC the Statements under Oath of the Principal
Executive Officer and the Principal Financial Officer pursuant to the SEC's
June 27, 2002 Order requiring the filing of such statements.

     A report on Form 8-K was filed on August 13, 2002 to report that James
J. O'Brien had been named  President  and Chief  Operating  Officer and was
elected to Ashland's  Board of Directors.  O'Brien would become Chairman of
the Board and Chief  Executive  Officer of Ashland  effective  November 15,
2002 when Paul W. Chellgren,  the then current Chairman and Chief Executive
Officer retired.

     A report on Form 8-K was filed on  September  19,  2002 to report that
James J. O'Brien would become Chief Executive  Officer of Ashland effective
October 1, 2002 and Chairman of the Board effective November 15, 2002.

                                    16

<PAGE>


                                 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.

                                  ASHLAND INC.
                                 (Registrant)
                                  By:


                                 /s/ J. Marvin Quin
                                 -----------------------------------
                                 J. Marvin Quin
                                 Senior Vice President and Chief
                                 Financial Officer

                                 Date:  December 3, 2002

     Pursuant to the  requirements of the Securities  Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant, in the capacities indicated, on December 3, 2002.

      SIGNATURES                                   CAPACITY
      ----------                                   --------

 /S/ JAMES J. O'BRIEN             Chairman of the Board, Chief Executive Officer
---------------------------        and Director
     JAMES J. O'BRIEN

 /S/ J. MARVIN QUIN               Senior Vice President and Chief
---------------------------        Financial Officer
     J. MARVIN QUIN

 /S/ KENNETH L. AULEN             Administrative Vice President, Controller and
---------------------------        Principal Accounting Officer
     KENNETH L. AULEN

           *                      Director
---------------------------
     SAMUEL C. BUTLER

           *                      Director
---------------------------
     FRANK C. CARLUCCI

           *                      Director
---------------------------
     ERNEST H. DREW

           *                      Director
---------------------------
     JAMES B. FARLEY

           *                      Director
---------------------------
     ROGER W. HALE

           *                      Director
---------------------------
     BERNADINE P. HEALY

           *                      Director
---------------------------
     MANNIE L. JACKSON

           *                      Director
---------------------------
     PATRICK F. NOONAN

                                    17

<PAGE>

           *                      Director
---------------------------
     JANE C. PFEIFFER

           *                      Director
---------------------------
     WILLIAM L. ROUSE, JR.

           *                      Director
---------------------------
     THEODORE M. SOLSO

           *                      Director
---------------------------
     MICHAEL J. WARD


     *By: /s/ David L. Hausrath
           ---------------------
           David L. Hausrath
           Attorney-in-Fact


     Date:  December 3, 2002


                                  CERTIFICATION
                                  -------------

Statement  Pursuant  to Section  302 of the  Sarbanes-Oxley  Act of 2002 by
Chief  Executive  Officer  Regarding  Facts and  Circumstances  Relating to
Exchange Act Filings.

     I, James J. O'Brien,  Chief Executive Officer of Ashland Inc., certify
that:

1.       I have reviewed this annual report on Form 10-K of Ashland Inc.;

2.       Based on my  knowledge,  this  annual  report does not contain any
         untrue  statement  of a material  fact or omit to state a material
         fact  necessary  to make  the  statements  made,  in  light of the
         circumstances   under  which  such   statements   were  made,  not
         misleading  with  respect  to the period  covered  by this  annual
         report;

3.       Based  on  my  knowledge,  the  financial  statements,  and  other
         financial  information  included  in this  annual  report,  fairly
         present in all material respects the financial condition,  results
         of operations and cash flows of the registrant as of, and for, the
         periods presented in this annual report;

4.       The registrant's  other certifying  officers and I are responsible
         for   establishing   and  maintaining   disclosure   controls  and
         procedures  (as defined in Exchange  Act Rules  13a-14 and 15d-14)
         for the registrant and have:

          a) designed  such  disclosure  controls and  procedures to ensure
         that material  information  relating to the registrant,  including
         its  consolidated  subsidiaries,  is made  known  to us by  others
         within  those  entities,  particularly  during the period in which
         this annual report is being prepared;

          b) evaluated the  effectiveness  of the  registrant's  disclosure
         controls and  procedures  as of a date within 90 days prior to the
         filing date of this annual report (the "Evaluation Date"); and

          c)  presented  in this annual  report our  conclusions  about the
         effectiveness  of the disclosure  controls and procedures based on
         our evaluation as of the Evaluation Date;

5.       The registrant's  other certifying  officers and I have disclosed,
         based on our most recent evaluation,  to the registrant's auditors
         and the audit  committee of  registrant's  board of directors  (or
         persons performing the equivalent functions):

          a) all  significant  deficiencies  in the design or  operation of
         internal  controls which could adversely  affect the  registrant's
         ability to record,  process,  summarize and report  financial data
         and have  identified  for the  registrant's  auditors any material
         weaknesses in internal controls; and

          b) any fraud,  whether or not material,  that involves management
         or other employees who have a significant role in the registrant's
         internal controls; and

                                    18

<PAGE>


6.       The registrant's other certifying officers and I have indicated in
         this  annual  report  whether  there were  significant  changes in
         internal  controls or in other  factors  that could  significantly
         affect internal controls subsequent to the date of our most recent
         evaluation,  including  any  corrective  actions  with  regard  to
         significant deficiencies and material weaknesses.


 Date: December 3, 2002

                                               /s/ James J. O'Brien
                                               -----------------------
                                               Chief Executive Officer


                               CERTIFICATION
                               -------------

Statement  Pursuant  to Section  302 of the  Sarbanes-Oxley  Act of 2002 by
Chief  Financial  Officer  Regarding  Facts and  Circumstances  Relating to
Exchange Act Filings.

     I, J. Marvin Quin,  Chief Financial  Officer of Ashland Inc.,  certify
that:

1.       I have reviewed this annual report on Form 10-K of Ashland Inc.;

2.       Based on my  knowledge,  this  annual  report does not contain any
         untrue  statement  of a material  fact or omit to state a material
         fact  necessary  to make  the  statements  made,  in  light of the
         circumstances   under  which  such   statements   were  made,  not
         misleading  with  respect  to the period  covered  by this  annual
         report;

3.       Based  on  my  knowledge,  the  financial  statements,  and  other
         financial  information  included  in this  annual  report,  fairly
         present in all material respects the financial condition,  results
         of operations and cash flows of the registrant as of, and for, the
         periods presented in this annual report;

4.       The registrant's  other certifying  officers and I are responsible
         for   establishing   and  maintaining   disclosure   controls  and
         procedures  (as defined in Exchange  Act Rules  13a-14 and 15d-14)
         for the registrant and have:

          a) designed  such  disclosure  controls and  procedures to ensure
         that material  information  relating to the registrant,  including
         its  consolidated  subsidiaries,  is made  known  to us by  others
         within  those  entities,  particularly  during the period in which
         this annual report is being prepared;

          b) evaluated the  effectiveness  of the  registrant's  disclosure
         controls and  procedures  as of a date within 90 days prior to the
         filing date of this annual report (the "Evaluation Date"); and

          c)  presented  in this annual  report our  conclusions  about the
         effectiveness  of the disclosure  controls and procedures based on
         our evaluation as of the Evaluation Date;

5.       The registrant's  other certifying  officers and I have disclosed,
         based on our most recent evaluation,  to the registrant's auditors
         and the audit  committee of  registrant's  board of directors  (or
         persons performing the equivalent functions):

          a) all  significant  deficiencies  in the design or  operation of
         internal  controls which could adversely  affect the  registrant's
         ability to record,  process,  summarize and report  financial data
         and have  identified  for the  registrant's  auditors any material
         weaknesses in internal controls; and

          b) any fraud,  whether or not material,  that involves management
         or other employees who have a significant role in the registrant's
         internal controls; and

6.       The registrant's other certifying officers and I have indicated in
         this  annual  report  whether  there were  significant  changes in
         internal  controls or in other  factors  that could  significantly
         affect internal controls subsequent to the date of our most recent
         evaluation,  including  any  corrective  actions  with  regard  to
         significant deficiencies and material weaknesses.

Date:  December 3, 2002
                                               /s/ J. Marvin Quin
                                               ------------------------
                                               Chief Financial Officer

                                    19

<PAGE>


INDEX TO FINANCIAL STATEMENTS AND FINANCIAL SCHEDULE
                                                                     Page
                                                                     ----
     Consolidated financial statements:
     Statements of consolidated income ................................*
     Consolidated balance sheets ......................................*
     Statements of consolidated stockholders' equity ..................*
     Statements of consolidated cash flows ............................*
     Notes to consolidated financial statements .......................*
     Information by industry segment ..................................*
     Report of independent auditors....................................21
     Consolidated financial schedule:
     Schedule II - Valuation and qualifying accounts...................22

     *The consolidated  financial  statements appearing on pages 43 through
61 in Ashland's  Annual Report are incorporated by reference in this Annual
Report on Form 10-K.

     Schedules  other than that listed above have been  omitted  because of
the absence of the conditions  under which they are required or because the
information  required is shown in the consolidated  financial statements or
the notes thereto.  Separate financial  statements for MAP required by Rule
3-09 of  Regulation  S-X will be filed as an  amendment  to this  Form 10-K
within 90 days after the end of MAP's fiscal year ending December 31, 2002.
Separate  financial  statements  of  other  unconsolidated  affiliates  are
omitted  because each company does not constitute a significant  subsidiary
using the 20% tests  when  considered  individually.  Summarized  financial
information  for  such  affiliates  is  disclosed  in  Note D of  Notes  to
Consolidated Financial Statements in Ashland's Annual Report.

                                     20

<PAGE>


                         REPORT OF INDEPENDENT AUDITORS

     We have audited the consolidated  financial statements and schedule of
Ashland Inc. and consolidated subsidiaries listed in the accompanying index
to  financial   statements  and  financial  schedule  (Item  15(a)).  These
financial  statements  and  schedule  are the  responsibility  of Ashland's
management.  Our responsibility is to express an opinion on these financial
statements and schedule based on our audits.

     We  conducted  our  audits  in  accordance  with  auditing   standards
generally  accepted in the United States.  Those standards  require that we
plan and perform the audit 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.   An  audit  also  includes  assessing  the
accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. We believe
that our audits provide a reasonable basis for our opinion.

     In our opinion,  the financial  statements  listed in the accompanying
index to financial  statements (Item 15(a)) present fairly, in all material
respects,   the  consolidated   financial  position  of  Ashland  Inc.  and
consolidated   subsidiaries  at  September  30,  2002  and  2001,  and  the
consolidated  results of their  operations and their cash flows for each of
the three years in the period ended  September 30, 2002, in conformity with
accounting principles generally accepted in the United States. Also, in our
opinion,  the related  financial  statement  schedule,  when  considered in
relation  to the  basic  financial  statements  taken as a whole,  presents
fairly in all material respects the information set forth therein.

     As  discussed  in Note A to the  financial  statements,  in  2002  the
Company changed its method of accounting for goodwill and other  intangible
assets.  Additionally,  as discussed in Note A to the financial statements,
in 2001 the  Company and its  unconsolidated  affiliate,  Marathon  Ashland
Petroleum LLC, changed their method of accounting for derivatives.

                                                   /s/ Ernst & Young LLP
     Cincinnati, Ohio
     November 6, 2002

                                    21

<PAGE>


<TABLE>
<CAPTION>



-----------------------------------------------------------------------------------------------------------------------------------
 Ashland Inc. and Consolidated Subsidiaries
 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS


<S>                                                        <C>             <C>             <C>            <C>              <C>
-----------------------------------------------------------------------------------------------------------------------------------
(In millions)                                              Balance at      Provisions                                      Balance
                                                            beginning      charged to      Reserves            Other        at end
Description                                                   of year        earnings      utilized          changes       of year
-----------------------------------------------------------------------------------------------------------------------------------
YEAR ENDED SEPTEMBER 30, 2002
Reserves deducted from asset accounts
   Accounts receivable                                           $ 34            $ 24         $ (23)(1)          $ -          $ 35
   Inventories                                                     15               7            (6)               -            16
-----------------------------------------------------------------------------------------------------------------------------------
YEAR ENDED SEPTEMBER 30, 2001
Reserves deducted from asset accounts
   Accounts receivable                                           $ 25            $ 34         $ (25)(1)          $ -          $ 34
   Inventories                                                     13               5            (3)               -            15
-----------------------------------------------------------------------------------------------------------------------------------
YEAR ENDED SEPTEMBER 30, 2000
Reserves deducted from asset accounts
   Accounts receivable                                           $ 23            $ 15         $( 12)(1)          $(1)         $ 25
   Inventories                                                     15               3            (5)               -            13
-----------------------------------------------------------------------------------------------------------------------------------

</TABLE>

(1)      Uncollected  amounts written off, net of recoveries which were not
         significant in 2002, $1 million in 2001 and $1 million in 2000.


                                       22

<PAGE>


                                  Exhibit Index

Exhibit No.                  Description


3.2      By-laws of Ashland, effective as of November 15, 2002.

10.2     Ashland  Inc.   Deferred   Compensation   Plan  for   Non-Employee
         Directors.

10.3     Ashland Inc. Deferred Compensation Plan.

10.4     Tenth  Amended  and  Restated  Ashland  Inc.   Supplemental  Early
         Retirement Plan for Certain Employees, as amended.

10.5     Ashland Inc. Salary Continuation Plan.

10.6     Form of Ashland Inc. Executive Employment Contract between Ashland
         Inc. and certain executives of Ashland.

10.7     Form of Separation  Agreement and General  Release between Ashland
         Inc.  and Paul W.  Chellgren,  former Chief  Executive  Officer of
         Ashland.

10.9     Ashland Inc. Nonqualified Excess Benefit Pension Plan.

10.11    Ashland Inc. Directors' Charitable Award Program.

10.14    Ashland Inc. 1997 Stock Incentive Plan.

10.15    Amended and Restated Ashland Inc. Incentive Plan.

12       Computation of Ratio of Earnings to Fixed Charges.

13       Portions of Ashland's Annual Report to Shareholders,  incorporated
         by reference herein, for the fiscal year ended September 30, 2002.

21       List of subsidiaries.

23.1     Consent of independent auditors.

24       Power  of  Attorney,   including   resolutions  of  the  Board  of
         Directors.

99.1     Certificate  of Chief  Executive  Officer of Ashland  pursuant  to
         Section 906 of the Sarbanes-Oxley  Act of 2002, 18 U.S.C.  Section
         1350.

99.2     Certificate  of Chief  Financial  Officer of Ashland  pursuant  to
         Section 906 of the Sarbanes-Oxley  Act of 2002, 18 U.S.C.  Section
         1350.



<PAGE>