Albemarle Corporation

Morgan Stanley Basic Materials Conference February 22, 2005 Mark RohrMark Rohr PresidentP r&es identCEO, CEO Cautionary Statement

Some of this presentation constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Although Albemarle Corporation believes its expectations reflected in the presentation are based on reasonable assumptions within the bounds of its knowledge of its business and operations, there can be no assurance that actual results will not differ materially. Factors that could cause actual results to differ from expectations include, without limitation, the timing of orders received from customers; the gain or loss of significant customers; competition from other manufacturers; changes in demand for our products; increases in the cost of raw materials and energy, and our inability to pass through such increases to our customers; changes in the market in general; fluctuations in foreign currencies; significant changes in new product introductions, resulting in increased capital spending; and the integration of the Akzo Nobel Refinery Catalysts business into our operations. Additional factors that could cause Albemarle’s results to differ materially from those described in the forward- looking statements can be found in our prospectuses dated January 13, 2005, filed pursuant to SEC Rule 424(b).

1 Company Overview

Albemarle is a global producer of specialty chemicals with leading market positions in a majority of its product lines ƒ Diversified mix of solution-based products sold to a wide range of customers and end markets – Over 3,400 customers – End markets include consumer electronics, petroleum refining, packaging, construction, automotive, pharmachemicals and agrichemicals ƒ Broad geographic footprint – Sales in approximately 100 countries – 38 locations (inc. JVs) in North and South America, Europe and Asia – Approximately 3,700 employees worldwide

ƒ 2004 Results (1) - Net Sales $1,514 million - Net Income, excluding specials $76 million (up 13% over 2003) - EPS, excluding specials $1.78 Albemarle provides innovative development, manufacturing and marketing of complex chemicals and services that create exceptional customer value while maximizing shareholder wealth.

(1) Year ending December 31, 2004 unaudited results include 5 months refinery 2 catalysts business Leading Market Positions in Major Product Categories

Foundation Solutions-Based Leading Global Chemistries Product Portfolio Market Positions

Flame Retardants Bromine-based FRs Process Application Technology “Know-How” Mineral FRs Bromine Catalysts HPC Catalysts Phosphorus Plastic Additives FCC Catalysts

Alumina Fuel Additives Alkyl Co-Catalysts

Metallocene Co-Catalysts Orthoalkylation Agrichemicals Alkylated Anilines Metal Alkyls Pharmaceuticals Leading Bromine Innovation Customer Performance Relationships Ibuprofen Chemicals

Albemarle’s Formula for Success

3 Source: Industry Research and Management Estimates. Well Positioned to Grow in Diverse End-Markets

Growing demand Industrial Consumer Changing performance criteria Evolving substitution of Cl2 Electronics Fire Safety Growth in oil exploration Other End of Life Considerations Expanding use of Br2 building blocks 8-10% 2-4% Auto/Transport Higher performance/ safety 3-5% Weight reduction 2-3% Refining

End of Life Considerations Increasing demand for petroleum 5% Tightening fuel specifications

Construction 3-5% 6-10% Deteriorating quality of feedstocks Demand for new construction New construction technologies Fire Safety Packaging Enhanced performance Chemical Services Convenience Move to outsource product development/manufacturing Availability of new polymers Regulatory improvements related to quality standards Steady demand for generics

% Estimated long term market growth rates

4 Technological Leadership

ƒ Strong proprietary positions: 1,500+ active patents; 1000+ pending applications ƒ Approximately 350 R&D employees, of which approximately 1/3 have PhDs ƒ Broad technological expertise in a wide range of specialty materials and chemistries ƒ 70% of R&D focused on defined commercial projects ƒ Approximately 17% of 2004 net sales generated from new products(1) – Includes impact from Refinery Catalysts, which historically generated 40% of sales from new products

300

Sales 250 roduct New P AGR in 28% A 200 n o i l l i 150 264 $ M 100 152 122 130 50 112 78

0 1999 2000 2001 2002 2003 2004

5 (1) New products – released within the last five years Broad Geographic Reach Worldwide manufacturing complemented by sales, marketing and distribution facilities in each of the world’s key regions Teesport, UK Amsterdam, The Netherlands Avonmouth, UK

Amersfoort, The Netherlands Bergheim, Germany Tyrone, PA, USA

Dayton, OH, USA Beijing, China Louvain-la-Neuve, Belgium Seoul, Korea Richmond, VA, USA Feluy, Belgium St. Jakob/Breitenau, Austria (JV)

Orangeburg, SC, USA La Voulte, France (JV) Thann, France Port-de-Bouc, France Baton Rouge, LA, USA Tokyo, Japan Magnolia, AR, USA Pasadena, TX, USA Osaka, Japan, (NAA JV)

Houston, TX, USA Safi, Jordan Niihama, Japan (JBC JV) (Nippon Ketjen JV)

Shanghai, China (JVs) Singapore

Zhejiang Province, China Santa Cruz, Brazil

(FCC SA JV)

Business Center Manufacturing Facility R&D Facility Americas Europe Asia 2004 Sales (exc. JVs) 42% 38% 20%

6 Key Strategic Principles

ƒ Leverage Foundation Businesses and Technologies – Innovation allows for management of product rotation – Customer-driven product line expansions – Focus on higher-margin, solution-based products and services ƒ Establish Superior Customer and Technology Relationships – Drive innovation in regulatory-driven markets – Provide value-added products and services – Develop business with less capital and risk ƒ Drive Low-Cost Manufacturing and Continuous Operational Improvement – Continuous cost reduction efforts – Flexible, multi-purpose sites ƒ Expand Global Reach – Expand with new and existing multinational customers – Target high-growth economies

7 Segment Overview Albemarle Corporation Today ƒ Refinery Catalysts acquired July 31, 2004 for €616 million ($763 million) – Significantly enhances existing business by adding attractive strong specialty chemicals platform – Leading positions in a market with strong industry fundamentals – Proprietary technology and service-driven business model – Strong margins and cash flows – Potential technology, raw material and other cost synergies ƒ Balanced portfolio with common technology

Approx. Net Sales Distribution Polymer Catalysts Additives 29% 41%

Fine Chemicals 30% 9 Polymer Additives Polymer Additives—Overview

ƒ Growth driven primarily by demand in the 2004 Net Sales electronics, construction, automotive and furniture industries Other Additives ƒ Success built on innovation, strong customer 27% relationships, global presence and strategic acquisitions – FRs: Bromine, Phosphorus, Mineral – Plastic and other additives Flame Retardants ƒ Pricing initiatives under way, driven by tight 73% demand/supply balance

Net Sales ($million) Operating Profit ($million)

726 84 $800 $80 20% 548 50 56 59 15 600 460 60 381 10 400 40 5 200 20 0 0 0 2001 2002 2003 2004 2001 2002 2003 2004 Operating Profit Operating Margin 10 Polymer Additives Flame Retardant Position

ƒ A Worldwide Leader in Key Global Market Size: $2.4 billion FR Chemistries – Bromine Phosphorus Mineral – Mineral 23% 24% – Phosphorus ƒ Innovations in 1990’s – Stream of Successful New FRs Other – Widest FR Technical Service Breadth 14% ƒ Best Cost/Quality/Service In Industry – Major FR Quality Upgrades Introduced Bromine 39% – Multiple Customer Awards – Bromine Cost Improvements— Arkansas, USA; Safi, Jordan

11 Market Data: Industry Research and Management Estimates. Flame Retardant Vision: Polymer Additives To Become the Premier Fire Safety Company We Offer Innovative Need for Tighter Standards Fire Safety Solutions ƒ Over 165,000 fire deaths per year – US—3,000 deaths; 20,000 injuries ƒ Broadest FR additives portfolio (Rhode Island fire killed 100 in 2003) (bromine, phosphorus, mineral) – EU—4,000 deaths; 80,000 injuries ƒ Engaged in driving fire safety advocacy ƒ Ignition of upholstered furniture accounts for more fire deaths in the US than any ƒ Influencing global fire safety standards other category ƒ Providing regulatory and flammability – Total societal cost: est. $2.5 billion testing support to the market ƒ Since 1988, over 1,000 lives saved in the UK as a result of stricter fire safety standards for furniture

12 Market Data: Industry Research. Catalysts Catalysts—Overview

ƒ Growth driven primarily by increasing demand 2004 Net Sales (w/5 months refinery) for petroleum, tightening fuel quality Polyolefin Catalysts specifications, and decreasing quality of crude 35% oil feedstock ƒ Success built on “blue chip” customer and JV relationships, customer service and proprietary technology Refinery Catalysts ƒ Strong FCC market demand; HPC business 65% under pressure due to molybdenum costs

Net Sales ($million) Operating Profit ($million)

15% $500 60 40 10 400 283 32 300 20 10 9 12 5 200 15 99 92 83 0 0 100 2001 2002 2003 2004 0 2001 2002 2003 2004 Operating Profit Operating Margin Operating Profit ex. acquisition related charges As reported in 4Q04 earnings release of Feb 3, 2005.

13 Catalysts Hydro Processing Catalysts

ƒ Main function: desulfurization of various oil streams in the refinery ƒ Units are filled with fixed bed of catalysts

ƒ Oil flows through in trickle phase, with hydrogen

ƒ Pressures up to 150 bar, temp up to 390 C

ƒ Catalyst economic life time: 1 to 2 years

ƒ Unit taken out of service during catalyst change

14 Catalysts Fluidized Cracking Catalysts

ƒ Main function: Cracking of heavy oil fractions (large molecules) into lighter, more valuable products (small molecules)

ƒ 445 FCC units worldwide; the gasoline makers

ƒ Catalyst is circulating like a fluid through the riser- reactor, the stripper and the regenerator

ƒ Continuous replenishment with fresh catalyst, while spent catalyst is purged

ƒ Catalysts are tailored to individual units according to feed and desired product slate

15 Catalysts Polymerization Catalysts

ƒ A range of organo metallic materials used in the catalytic production of Polypropylene (PP ) , Polyethylene ( PE ) and Elastomers ƒ Albemarle is a global leader in the production of metallocenes, related catalysts & activators ƒ Co-develop catalysts with the PE & PP majors for their mfg processes ƒ Custom manufacture catalysts for many of the PP & PE majors

The above materials are generally air sensitive & pyrophoric, hence extreme care is necessary in handling. Product stewardship is a significant obligation – and opportunity !

16 Catalysts Catalyst Opportunities

$10 Billion Catalyst Industry Other 10% Polyolefin ƒ 3–5% industry growth Environmental Heritage 22% annually 27% Strength ƒ $200 to $300 million annual Acquired growth opportunity Strength

ƒ Refinery Catalysts grew at Refinery about 4% annually over the 21% past 4 years Chemical 20% ƒ Albemarle is well-positioned to grow into related catalyst market areas

17 Market Data: Industry Research and Management Estimates. Catalysts Drivers of Hydrotreating Activity

Gasoline Sulphur Specifications (wt ppm) Global Hydrotreating Capacity (1990–2015) (MMbpd) 1200 Actual Estimated 70 1000 Europe 60 800 Japan 50

600 40 USA 30 400 20

200 10 0 0 1994 1998 2002 2006 2010 1990 1995 2000 2005 2010 2015

Diesel Sulphur Specifications (wt ppm) Global Crude Oil Production (1990–2015) 2500 (Barrels per day—millions) Actual Estimated Europe 100 2000 80 1500 Japan USA 60 1000 40 500 20

0 1994 1998 2002 2006 2010 0 1990 1995 2000 2005 2010 2015

18 Source: Industry Research. Fine Chemicals Fine Chemicals—Overview

ƒ Fine Chemistry Services & Intermediates 2004 Net Sales – Support customers in development of life sciences products Pharm/Ag/FCS&I – Pharmaceuticals and Ag actives and 43% intermediates Performance ƒ Performance Chemicals Chemicals – Leading global bromine producer 57% – Oil field chemicals and biocides

Net Sales ($million) Operating Profit ($million)

$80 20% $600 480 504 463 455 61 60 60 Headwinds 400 49 40 44 10 200 20 39 5 0 0 0 2001 2002 2003 2004 2001 2002 2003 2004 Operating Profit Operating Margin ex. special charges as reported in 4Q04 earnings on 2/3/05 19 Fine Chemicals World-Class Bromine Position Albemarle Bromine Production 350 Capturing growth through strong positions in 300 7.5% R = CAG key areas of the world’s year 250 10- bromine-using industries

200 M Lbs.

150

100 Industrial Uses of Bromine ’94 ’95 ’96 ’97 ’98 ’99 ’00 ’01 ’02 ’03 ’04 Other 14% Flame Pharma Retardants 3% 40% Low cost domestic reserves Water augmented by JV production Treatment on the Dead Sea 7%

Ag 12%

Oil Field Products

20 Source: Albemarle; USGS/Mining Engineering, June 2003. 24% Fine Chemicals Fine Chemistry Services—Key Profit Drivers Providing new product solutions and innovation that address accelerated “discovery-to-launch” cycles Pharma New Product Development Pipeline(1) ƒ Flexible custom manufacturing allows for 90 continuous rejuvenation of fine chemistry 4 Generic 80 portfolio 15 Patent Protected – New pharma actives and ibuprofen line

s 70 extensions 10 Phase III – New technology service offerings 60 15 Phase II – 90 new pharma-related products in pipeline 50 40 ƒ Foundation business based on established 20 Phase I Life Science products 30 – Key analgesics—ibuprofen and naproxen # of New Product 20 – Aniline-based intermediates for agrichemicals 26 Preclinical 10 ƒ Offering bromine-based building blocks essential for production of pharmaceuticals 0 and other fine chemicals

Only 5 out of 5,000 pharmaceuticals tested reach human clinical trials. Only 1 of the 5 that reach human clinical trials actually reaches the market.(2)

21 (1) As of year-end 2004. (2) Source: Tufts University for the Study of Drug Development, 2001 Financial Focus

ƒ Generate superior cash flow

– Industry-leading EBITDA margins

ƒ Grow through reinvestment in existing business

– Support commercially-focused R&D

– Capital spending and focused bolt-on acquisitions

ƒ Reduce debt—maintain investment grade rating

ƒ Manage and monitor contingent liabilities

ƒ Return excess capital to shareholders through dividends and/or stock purchases

22 Strong Cash Flows Even in difficult markets, Albemarle has generated high quality returns

($million) $300

240 $227 $213 $187 $186 $180 $177 180

120 $105 (1) $83 $83 $86 $68 $70 60

0 1999 2000 2001 2002 2003 2004 (2) EBITDA Free Cash Flow

(1) Preliminary result, pending final 2004 audit (2) Cash flow from operations less capital expenditures less dividends paid plus dividends received. Reconciliations of EBITDA and FCF posted on www.albemarle.com under Investor Information

23 Historical Focus on Dividends

Dividends Paid $0.70

$0.58 0.60 $0.56 $0.54 4% $0.52 11. AGR: 0.50 ar C $0.46 10-Ye $0.40 0.40 $0.37 $0.32 0.30 $0.25 $0.20 $0.21 0.20

0.10

0.00 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

24 Albemarle Corporation Investment Considerations

ƒ Global Leading Market Positions

ƒ Diversified Revenue Base

ƒ Attractive Growth Opportunities

ƒ Technological Excellence and Innovation

ƒ Flexible, Low-Cost Manufacturing Base

ƒ Strong Cash Flow

25