SHELL, TEXACO UNITS SEPARATELY PURSUE FUEL CELL PRODUCT DEVELOPMENT

Technology subsidiaries of two multinational oil companies are forming joint ventures to pursue fuel cell product development. Shell Hydrogen U.S., a division of Royal Dutch/Shell's (NYSE: RD and ST) Shell Oil Products Co. unit, and United Technologies Corp.'s (NYSE: UTX) International Fuel Cells subsidiary, intend to establish a company to develop, manufacture and sell fuel processors for the emerging fuel cell and hydrogen fuel markets. Meanwhile, Texaco Inc.'s (NYSE: TX) Texaco Energy Systems, Inc. (TESI) subsidiary and Energy Conversion Devices Inc. (NASDAQ: ENER) are forming Texaco Ovonic Fuel Cell Co. LLC to develop and commercialize the Ovonic Regenerative Fuel Cell.

The two separate joint ventures reflect a similar belief by Shell and Texaco that fuel cells represent significant potential not only as alternatives to current motor vehicle engines and fuels, but also in electricity and industrial markets.

Shell and IFC intend to develop processors to convert fossil fuels, such as natural gas or gasoline, into hydrogen. Their joint venture's market targets will be fuel cells in automobiles, buses, and power generators, and at distributed hydrogen fueling applications (such as at retail or commercial filling stations, convenience stores, and residences).