Quaker Chemical Announces Manufacturing Site Expansion

CONSHOHOCKEN, Pa., May 20 /PRNewswire-FirstCall/ -- Quaker Chemical
Corporation (NYSE: KWR) today announced plans to triple production capacity in
its Middletown, Ohio, facility and centralize Quaker's North American
production of steel, cleaner, and hydraulic fluids at that facility.
Upon completion in late 2009, the Middletown facility would become
Quaker's second largest facility globally. Quaker will transfer all production
except for its metalworking fluids from its plant in Detroit to Middletown.
The expanded facility will provide Quaker with additional capacity to meet the
growing needs of its customers, increase manufacturing flexibility, and
improve production efficiency in a time of rapidly escalating raw material
prices. The project will require an investment of approximately $19.8 million,
of which approximately $10.0 million will be financed through the issuance of
Industrial Development Revenue Bonds by the Butler County Port Authority.
Additional financing for the project will include a $3.5 million loan from the
Ohio Department of Development and equipment leases, as well as internal
sources. The Company expects the loan and equipment leases to be completed in
the next few months.
"Our planned expansion in Middletown is an important investment in our
future manufacturing capability and also reduces capital expenditures in our
Detroit, Michigan, facility. The favorable financing we have secured for this
project will enhance our returns and cash flows. Once fully implemented in a
couple of years, we expect to improve our cash flow by approximately
$3 million per year due primarily to lower manufacturing costs," commented
Ronald J. Naples, Chairman and Chief Executive Officer.
Mike Barry, Senior Vice President and Managing Director for Quaker North
America said, "The centralization of much of our North American production
into a modern facility in Middletown will lower our manufacturing costs while
providing additional capacity necessary for our business in the future. In
addition, the modern production techniques that are incorporated in the plant
design will reduce waste generation and further improve our impact on the
environment."
FMC Technologies, Inc. will serve as lead contractor for the expansion.
Quaker Chemical Corporation is a leading global provider of process
chemicals, chemical specialties, services, and technical expertise to a wide
range of industries -- including steel, automotive, mining, aerospace, tube
and pipe, coatings and construction materials. Our products, technical
solutions, and chemical management services enhance our customers' processes,
improve their product quality, and lower their costs. Quaker's headquarters is
located near Philadelphia in Conshohocken, Pennsylvania.
This release contains forward-looking statements that are subject to
certain risks and uncertainties that could cause actual results to differ
materially from those projected in such statements. A major risk is that the
Company's demand is largely derived from the demand for its customers'
products, which subjects the Company to downturns in a customer's business and
unanticipated customer production shutdowns. Other major risks and
uncertainties include, but are not limited to, significant increases in raw
material costs, customer financial stability, worldwide economic and political
conditions, foreign currency fluctuations, and future terrorist attacks such
as those that occurred on September 11, 2001. Other factors could also
adversely affect us. Therefore, we caution you not to place undue reliance on
our forward-looking statements. This discussion is provided as permitted by
the Private Securities Litigation Reform Act of 1995.
SOURCE Quaker Chemical Corporation

Mark A. Featherstone, Vice President and Chief Financial Officer of Quaker
Chemical Corporation, +1-610-832-4160