Hexion Specialty Chemicals, Inc. Announces Completion of Tender Offers and Consent Solicitations and that it is Calling for Redemption all of its Outstanding 13 1/2% Senior Subordinated Notes and 9 1/2% Senior Second Secured Notes

COLUMBUS, Ohio--May 18, 2006--Hexion Specialty Chemicals, Inc. ("Hexion" or the "Company") announced today that it has completed its previously announced tender offers and consent solicitations for its 13 1/2% Senior Subordinated Notes Due 2010 (the "13 1/2% Notes"), 9 1/2% Senior Second Secured Notes Due 2010 (the "9 1/2% Notes") and 8% Senior Secured Notes Due 2009 (the "8% Notes"). The tender offers and consent solicitations expired as scheduled at midnight, New York City time, on May 17, 2006. Hexion has accepted for purchase $292,040,000 principal amount of the outstanding $328 million principal amount of its 13 1/2% Notes, $199,881,000 principal amount of the outstanding $200 million principal amount of its 9 1/2% Notes and the entire $140 million outstanding principal amount of its 8% Notes.

Hexion also announced today that it has called for redemption all of its outstanding 13 1/2% Notes (CUSIP: 76115NAB7) and 9 1/2% Notes (CUSIP: 76115NAD3) (the 13 1/2% Notes and 9 1/2% Notes are collectively referred to as the "Notes"). Interest on the Notes will cease to accrue on the redemption date, which is June 18, 2006. The cash redemption price for the 13 1/2% Notes is 106.75% of the outstanding principal amount thereof and the cash redemption price for the 9 1/2% Notes is 104.75% of the outstanding principal amount thereof. Hexion will pay accrued and unpaid interest of approximately $12.38 for each $1,000 principal amount of the 13 1/2% Notes redeemed and approximately $16.62 for each $1,000 principal amount of the 9 1/2% Notes redeemed, which amounts include accrued and unpaid interest up to, but not including, the redemption date. As of May 18, 2006, $35,960,000 aggregate principal amount of our 13 1/2% Notes and $119,000 aggregate principal amount of our 9 1/2% Notes were outstanding.

The formal redemption notice required by each Indenture has been sent to each respective trustee. The redemption of the Notes and the payment of the redemption price will be in accordance with the terms specified in the redemption notice and the redemption procedures of the respective trustee.

Forward Looking Statements

Certain statements in this press release are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. In addition, the management of Hexion Specialty Chemicals, Inc. (which may be referred to as "Hexion," "we," "us," "our" or the "Company") may from time to time make oral forward-looking statements. Forward looking statements may be identified by the words "believe," "expect," "anticipate," "project," "plan," "estimate," "will" or "intend" and similar expressions. The forward-looking statements contained herein reflect our current views with respect to future events and are based on our currently available financial, economic and competitive data and on current business plans. Actual results could vary materially depending on risks and uncertainties that may affect the Company's operations, markets, services, prices and other factors as discussed in Item 1A--Risk Factors of the Company's Form 10-Q, filed with the Securities Exchange Commission on May 15, 2006. Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to: economic factors such as an interruption in the supply of or increased pricing of raw materials due to natural disasters, competitive factors such as pricing actions by our competitors that could affect our operating margins, and regulatory factors such as changes in governmental regulations involving our products that lead to environmental and legal matters as described in Item 1. Legal Proceedings of the Company's Form 10-Q filed with the Securities Exchange Commission on May 15, 2006.

About Hexion Specialty Chemicals

Based in Columbus, Ohio, Hexion Specialty Chemicals combines the former Borden Chemical, Bakelite, Resolution Performance Products and Resolution Specialty Materials companies into the global leader in thermoset resins. Hexion serves the global wood and industrial markets through a broad range of thermoset technologies, specialty products and technical support for customers in a diverse range of applications and industries. Hexion Specialty Chemicals is owned by an affiliate of Apollo Management, L.P. Additional information is available at www.hexion.com.