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Initiated during the holiday period by the French Ministry of Finance & Industry, and presented by D. VALOT, the stock-market and financial operation in progress should lead to COFLEXIP and ISIS takeover by TECHNIP by the end of summer.

This operation, which is impelled, according to its originators, with a strictly industrial purpose, is presented as the dream public offer of exchange/takeover bid by the Ministry of Finance and by our Chairman & CEO.

Its outcome will be the creation of a new multinational in the petroleum service and supply industry field through the concentration of two large French companies and by merging their respective international networks of subsidiaries (ISIS represents all the subsidiaries of the French Institute of Petroleum or IFP).

• TECHNIP: The operation would at once affect TECHNIP's financial status through high debt position created, near 30 % of the shareholders' fund, after bank loans, and probably switching to a negative cash position, which could only be restored to positive after several years. TECHNIP would take over COFLEXIP and a new corporation, NEW-ISIS, whose assigned future is not clear.

• IFP: The operation would mean for the IFP the immediate loss of its subsidiaries and a cash inflow of several hundreds of euros, a part of which might end in the coffers of the State.

• COFLEXIP: In a first stage, the operation would consist for COFLEXIP in merely switching shareholders and TECHNIP would take over a corporation listed in New York.

• GEOPHYSIQUE: Regarding GEOPHYSIQUE, notwithstanding the assurance given that this company would resume its position as a subsidiary of the IFP in a year, its temporary status within the scope of NEW-ISIS, while being aware that TECHNIP will not keep its stake in this company, requires clearer commitments by Authorities regarding this firm continuing operation in the future.

Can the creation of a TECHNIP-COFLEXIP group, which TECHNIP's Chairman and CEO intends to organize into three business streams - offshore production, onshore/downstream and industries (non-oil and gas)-, and into multiple operating centers scattered in many countries, have for sole consequences income and cost synergies, while work force will grow from 10 000 to 18 000 and after D. VALOT has already mentioned transfers of personnel within this new entity ?

Can anybody seriously believe that nothing will happen in such a Group and that D. VALOT's statement to answer our question during the Works Council meeting on July 3rd, 2001 regarding his no-redundancy-in-the-new-group commitment, "I keep the 18 000", will remain up-to-date in a few months ?

Is it possible to believe that the industrial project called in the same meeting a "dream" project would actually prevail over any other financial consideration ?

The creation of an integrated group, TECHNIP-COFLEXIP, attractive to some Clients and in keeping with growth prospects, is not, however, of the same nature as an engineering company in partnership with a process licensor, which is the status of our main competitors.

This creation should not lead us to excessive re-focussing on a preferential business segment, today trendy and a source of profit, upstream production, to the prejudice of other business lines and of other types of services which are core activities of TECHNIP and of TECHNIP FRANCE more specifically.

While complementarity of TECHNIP and COFLEXIP is clear, it is obvious that synergies will reveal redundant positions.

What upheavals will be met by the Personnel social rights and status ? It seemed clear during the Works Council meeting that the Chairman was reluctant to go into this matter.

It is too early today to make a thorough analysis and to fully assess all the consequences for employees of such a creation.

However, it may be noted that all the latest concentrations operations in FRANCE have generated heavy redundancies, for instance in the oil, nuclear or bank lines.

According to the Ministry's expert economists, who rushed the deal, concentration operations are the solution to safeguard French firms and their markets and to maintain them in FRANCE by compelling them to maintain in FRANCE... their head offices.

The operation has now been launched, without previously consulting the institutions representing employees of the various entities involved. The originators of this operation, who take the risk of getting the TECHNIP Group into debt, while the group's former circumstances have been quite easy until then, and of focussing more than 50 % of its activity on a single segment, must do their utmost to see that this deal is concluded without any negative consequence on employees.

Moreover, specific guarantees must be given to the personnel of TECHNIP FRANCE, since this operation is carried out after TECHNIP FRANCE has been deprived of its position as leader of the Group in terms of profit and of economic turnover further to the decisions to modify the workload split within the Group made by the holding over the last two years.

After a first on the spot analysis, we request in a first stage:

• the creation of a new TECHNIP-COFLEXIP shareholders' agreement between GDF, IFP, TOTALFINAELF, which would prevent any untimely withdrawal of the major shareholders or any takeover bid,

• maintaining in the Group of all the activities, without getting restricted to upstream, gas and industries grouped in LCI (life sciences, chemicals, non oil or gas industries), in particular at TECHNIP FRANCE. Regarding this issue, to consider, as the Chairman hinted during the Works Council meeting, that Refining could be limited to remodeling projects, as well as any downsizing of this stream of activity, appear to us as an error with regard to the future development of the group,

• status quo in both corporations in order to allow the reorganization started in TECHNIP to get completed under proper conditions,

• maintaining of LA DEFENSE and LYON staff,

• maintaining, and increase, of staff numbers in TECHNIP FRANCE with all its streams of activity and all its components,

• renewed prevalence of the performance of projects on a turnkey basis at TECHNIP FRANCE through implementation of a structure and of suitable resources implying in particular maintaining of Procurement and Execution, in order to improve returns form contract performance, as well as TECHNIP FRANCE's economic turnover and profit.

• restricting mixing of top managements to minimum, since such exchanges upset the corporation, as we could see upon integration of KTI/MDEU and upon creation of the holding.

Today, a meeting of the Group's Committee attended by top management and personnel representatives is held, convened by D. VALOT. First answers to our questions may be given by the Chairman during this meeting.