Hideo MasudaVice Chairman and CFO

JGC CORPORATIONEngineering for the Quality of Human Life

January 2007

Contents

Settlement of Accounts

New Contracts by Business Field

Major Orders in First Half-Year

JGC’s Trends in Orders Received

Outstanding Contracts

Outstanding Contracts by Business Fields

Our Clients’ Market Situation1-2

Current Environment for Contractors

JGC Countermeasures

JGC Action Plan1-5

1.

2.

3.

4.

5.

6.

7.

9.

10.

11.

440.00807.64469.53498.25New contracts

26.50(4.7)

20.38(3.7)

13.22(3.0)

15.48(3.7)

Operating income

560.00550.30435.19409.96Net sales

17.00(3.0)

15.01(2.7)

11.58(2.7)

10.58(2.5)

Net income

43.80(7.8)

36.23(6.6)

28.29(6.5)

30.42(7.4)

Gross profit

March 31, 2007 (exp.) (%)

March 31, 2006 (%)

March 31, 2005 (%)

March 31, 2004 (%)

(Billions of yen)

1. Settlement of Accounts

0 100,000 200,000 300,000 400,000 500,000 600,000

2006

2005

2004

2003

2002

■ Oil & Gas Development

■ Petroleum Refining

■ LNG

■ Chemical

■ Power Generation,Nuclear Power, New Energy

■ Living and General Production

■ Environmental Protection,Social Development and IT

■ Others

FiscalYear

Millions of Yen

2. Business Fields -New Contracts by Business Field

Forecast

3. Major Orders in First Half-Year

Africa

Gas Processing(FEED)

Japan

PharmaceuticalsChemicals

Asia

Chemicals

<Total in first half-year> 133 billion yen<Goal for full fiscal year> 440 billion yen

4. JGC’s Trends in Orders Received

Steady Increase in Two-year AverageSteady Increase in Two-year Average

FY2001-02 FY2003-04 FY2005-06

Avg. 350 billion yen

Avg. 480 billion yen

Avg. 620 billion yen

5. Outstanding Contracts

Hits All-time Record HighHits All-time Record High

Doubles in Five YearsDoubles in Five Years

1 trillionyen

550 billionyen

FY2002 FY2005

6. Outstanding Contracts -by Business Field

Oil & Gas Development

Petroleum Refining

LNG

Chemical

Power Generation, Nuclear Power, NewEnergyLiving and General Production

Environmental Protection, SocialDevelopment and ITOthers

Total ¥1,009billionTotal ¥1,009billionas of end of March 2006

2.1%1.4%

20.6%

24.3%

18.2%

28.3%

4.9%

0.06%

7. Our Clients’ Market Situation (1)

Over

seas

Accelerated development of new oil & gas fieldsgenerates large increases in downstream projects.

Numerous refineries, gas processing andPetrochemical projects are planned in MENA region.

Downstream projects revitalized in Southeast Asia.

8. Our Clients’ Market Situation (2)

Japa

nIncreased investment in refinery modernization, heavy crude oil processing and integratedfacilities for refining and petrochemicals

World forecast for 2007: US$50 billion to be spent on oil,gas, and petrochemical facilities,

representing a 20% year-on-year increaseSource: Hydrocarbon Processing – Market DATA 2007

In the MENA region, more than US$200 billion to be investedin oil and gas downstream facilities from 2007 thru 2011

Source: Middle East Economic Survey - APICORP Research

・Manufacturers・Skilled labor・Construction

equipment makers

Capacities ofcontractors

9. Current Environment for Contractors

Number of projectsby Clients

Capacities ofvendors &

subcontractors

Supplycapacity

Rises in equipment/materials costs caused byincreased demand

Longer delivery periods and lower qualitybrought about by overburdened vendors

Shortage of qualified workforce at subcontractors

10. JGC Countermeasures

Minimize Risksin All Project Phases

and Secure Profits

11. JGC Action Plan (1) For successful project execution

Diversify contract types(Open book estimates, Lump-sum conversion,Reimbursable, etc. )

Strengthen partnershipswith clients

Contract Engineering Procurement Construction

Continue expansion ofoverseas engineering centers

Increase use of outside resources

12. JGC Action Plan (2) For successful project execution

Contract Engineering Procurement Construction

Strengthen schedule control andQC staff (monitoring and supportfor vendors)

Engage in continuous gathering/analysis of cost and deliveryinformation for equipment & materials

Secure close relationship with key vendors from early stages

13. JGC Action Plan (3) For successful project execution

Contract Engineering Procurement Construction

Utilize reliable foreign subcontractorsIn other countries

Use proven resources from currentprojects for upcoming projects

Secure close relationship with key subcontractors from early stage

14. JGC Action Plan (4) For successful project execution

Contract Engineering Procurement Construction

Contract Engineering Procurement Construction

Adopt thorough ‘Risk Management’

Launch ‘Project Advisory System’giving to management direct involvement in major projects

“Effort at all stages”

15. JGC Action Plan (5) For successful project execution

Hideo MasudaVice Chairman and CFO

JGC CORPORATIONEngineering for the Quality of Human Life

January 2007

for Reference

JGC Group Scenario 2010 : New Medium-Term Management Plan

550 billion yen

15 billion yen

25%

11 yen

9.3%

600 billion yen

30 billion yen

25%

23 yen

11.0% or more

600 billion yen

30 billion yen

25%

23 yen

11.0% or more

Net Sales

Net Income

Dividend PayoutRatio

Annual DividendPer Share

ROE

(non-consolidated)

End of Fiscal 2005 End of Fiscal 2010 (Goal)

(non-consolidated)

1. Target Management Figures

2005 FY 20102006 2007 2008 2009

400

500

600

650

2. Expected Growth of Net Sales

Billionyen

490490

540540

560560580580

600600

520520

560560550550

2005 FY 20102006 2007 2008 2009

10

20

30

40

3. Expected Growth of Net Income

1212

1818

2121

24242727

3030

17171515

Billionyen

4. Non-E&C Business Strategy

・Water and power generation・Resource development・Gas emissions credits

Enterprise InvestmentEnterprise Investment

・Catalysts・Fine chemicals

ProductionProduction

・Operation & Maintenance (O&M)・Consulting

ServicesServices

40 billion yenTarget IRR : 12% or more

40 billion yenTarget IRR : 12% or more

1. Investing in Enterprises

Focusing on M&A for expansion of core business

2. E&C Business

On the Basis of a Secure Financial FoundationOn the Basis of a Secure Financial Foundation

From 2010 onward, recovery of investmentFrom 2010 onward, recovery of investment

5. Investment Planning

6. Effect on Profit of Exchange Rate Fluctuation

■ Total Cost : 462.8 billion yen

■ Overseas Job Cost : 370.2 billion yen(462.8 billion x 80%)

■ Cost Breakdown (as shown below)

Overseas 80%Domestic 20%

Equipment and Materials : 37% (78%)＊Payments to Japanese Vendors in Foreign Currency : 30%

Subcontracted Work: 46% (100%) Personnel Expenses: 7% (20%)

Other Expenses : 10% (80%)

( ): Overseas procurement

Overseas Domestic75% 25%

Overseas100%

Overseas 20%Domestic 80%

■ Amounts to be paid in billions of yen：

Equipment and Materials 21.09 (370.2 x 0.37 x 0.22 x 0.7)Subcontracted Work 0.00Personnel-related 20.73 (370.2 x 0.07 x 0.8)Other 7.40 (370.2 x 0.1 x 0.2)

■ Approximately 60% to be hedged byexchange contract

■ Exposure : 19.69 billion yen■ (US$184.02 million at Yen 107.00 = US$1)

Total 49.22Total 49.22

7. Effect on Profit of Exchange Rate Fluctuation

■ Trains : 31 (31.6% of world total)

■ Production : 90 million tons (35.9% of world total)

■ Trains : 31 (31.6% of world total)

■ Production : 90 million tons (35.9% of world total)

Egypt5,000,000 T/Y, 1 train

Nigeria2,950,000 T/Y, 3 trains4,000,000 T/Y, 3 trains

Brunei1,440,000 T/Y, 5 trains

Qatar3,300,000 T/Y, 2 trains

Indonesia1,500,000 T/Y, 1 train3,800,000 T/Y, 2 train

Australia2,430,000 T/Y, 3 trains4,200,000 T/Y, 1 train

Malaysia2,530,000 T/Y, 3 trains2,650,000 T/Y, 3 trains3,870,000 T/Y, 2 trains

Yemen3,350,000 T/Y, 2 trains

8. LNG Plant Construction Projects

9. Outlook for World LNG Demand

130

2005Actual

2020Forecast

14

America

101

Europe

33

155

Asia

92

2005Actual

2020Forecast

2005Actual

2020Forecast

(million tons/year)

World LNG consumption in 2005: 139 million tonsEstimated demand in 2020: 386 million tons

Need to add facilities to meet needs for 10 million tons/yearproduction increases annually over next 15 years

Source: IEEJ Asia/world Energy Outlook 2006

10. Planned LNG Projects

Egypt- SEGAS LNG T2- Iduku LNG T3

U.A.E..- ADGAS LNG T4 & T5

Angola- Angola LNG

Trinidad & Tobago- Atlantic LNG T5

Peru- Peru LNG

Australia- Gorgon LNG- Sunrise LNG- Pluto LNG- Pilbara LNG- Browse LNG- Ichthys LNG

Brunei- Brunei LNG T6

Malaysia- Malaysia LNG T9

Indonesia- Tangguh LNG T3

Iran- Pars LNG- Persian LNG- NIOC LNG

Russia- Schtokman LNG- Baltic LNG

EquatorialGuinea- LNG T2

＊Red indicates projects in which JGC provided FEED and/or EPC for existing facilities

Venezuela- Deltana CaribeLNG

Nigeria- OK LNG- Nigeria LNG 7 Plus- Brass LNG

JGC has been involved in many of these projects

Algeria- Skikda LNG- Arzew LNG

11. Worldwide Workforce

Increasing domestic and overseas manpower resources by 20% or more to respond to higher salesIncreasing domestic and overseas manpower resources by 20% or more to respond to higher sales

Expected Manpower Resource Expansion

Overseassubsidiaries

includingM.W. Kellogg

1,800

JGC1,900Domestic

EngineeringSubsidiaries1,800

JGCPhilippines(Philippines)900

JGC DESCONEngineering(Pakistan)300

PERTAFENIKKIEngineering(Indonesia)300

FY 2005FY 2010

7,000 Employees 8,500 Employees

Overseassubsidiaries

includingM.W. Kellogg

2,300

PERTAFENIKKI Engineering(Indonesia)500

DomesticEngineeringSubsidiaries2,000JGC

Philippines(Philippines)1,000

JGC DESCONEngineering(Pakistan)500

JGC2,200

GlobalEngineeringCenterGlobal

EngineeringCenter

12. Outstanding Contractsas Percentage by Business Region

Japan

Africa

Asia

Middle East

Oceania

North & South America

Others

0.1% 0.1%0.1%

21.1%

16.9%

4.6%

57.2%

Total ¥1,009 billionTotal ¥1,009 billionas of end of March 2006

100％

06 12 18 24 30 36months

20%

80%

100%

13. Progress Image

Co

nst

ructi

on

Pro

gre

ss

Time Schedule

Prog

ress

BOUYGUES ( France )5

STRABAG ( Austrian )4

VINCI ( France )3

SKANSKA ( Norway )2

HOCHTIEF ( Germany )1

JGC15

CHIYODA18

KAJIMA23

authority： ENR 21/28 Aug. 2006 The Top International Contractors

Over All RANK

JGC4SNAMPROGETTI ( Italy )5

BECHTEL ( U.S.A. )3

FLUOR ( U.S.A. )2

TECHNIP ( France )1

Industrial / Petroleum

14. Top International Contractors in 2005Contracting Revenue from project outside home country

80

100

120

140

160

180

200

220

240

Feb-

02

May

-02

Aug

-02

Nov

-02

Feb-

03

May

-03

Aug

-03

Nov

-03

Feb-

04

May

-04

Aug

-04

Nov

-04

Feb-

05

May

-05

Aug

-05

Nov

-05

Feb-

06

May

-06

Aug

-06

Time

Cos

t Ind

ex

CS Hot-Rolled Plate CS Structural Steel SS Hot-Rolled Plate (SS316)

CS Hot-Rolled Plate

SS Hot-Rolled Plate (SS316)

Source: MEPS (International)

CS Structural Steel

15. Steel Cost Trend

Sol/gel Preparation Technology

Nanoparticle

Alignment

Technology

Thin-film Preparation

Technology

De-NOx Catalyst

Anti-bacterial Agent

LCD-related Materials

EnvironmentalProtection

Conductive Materials

SemiconductorDisplay Materials

Optical

Materia

ls

Cosmeti

c Mate

rials

Mem

ory

Mat

eria

ls

Silic

a/Al

umin

a So

lFCC Catalyst

Zeolite

Direct Desulfurization Catalyst

Indirect Desulfurization Catalyst

ZSM-5

VCM Synthesizing Catalyst

Petrochemistry

Oil Refining

CatalystBusiness Fine

ChemicalBusiness

Colloidal Anti-Bacterial Agent

Ultra-precise Silica Particles

Carrier Tape

Insulating Coat Liquid

Conductive Coat Liquid

Insulating PlanarizationMaterial for Semiconductors

CRT Surface Coat Material

Titania Sol

Hard Coat for Plastic LensesUltra-FineSilica

UV Block/Soft Focus MaterialsVideo Tape Filler

OrganicSolvent Sol

Alcohol Flocculant

Precision Cast BinderGasoline

Heavy Oil

Kerosene, Diesel

Poly Vinyl Chloride

materialsrelated

NewBusiness

16. Main Products Catalysts & Chemical Industries Co., Ltd.