Moody’s downgrades Titan to Caa3; outlook negative

Approximately US$380 million of debt securities affected

Hong Kong, August 04, 2009 -- Moody's Investors Service has downgraded the 
corporate family rating of Titan Petrochemicals Group Limited ("Titan") 
to Caa3 from Caa1 and its senior unsecured bond rating to Ca from Caa2. 
The ratings outlook is negative.

This action follows Titan's announcement that it has appointed Goldman
Sachs (Asia) Ltd as its advisor in connection with a strategic review of 
its capital structure.

"Titan's announcement -- which indicates the option to explore debt 
forbearance -- highlights the seriousness of its financial difficulties 
and the tightness of its liquidity position," says Peter Choy, a Moody's 
Vice President and Senior Credit Officer.

"The downgrade reflects the concern that such adverse developments could 
increase the probability of it defaulting on its bond obligations,
leading in turn to a low level of recovery under distress," adds Choy.

Titan's appointment of an advisor has been accelerated by a call for 
equity to support its onshore oil storage business and a coupon payment
due in September 2009. 

This latest initiative -- the appointment of an advisor -- will also 
inevitably slow down its search for new debt and equity and will add to 
the uncertainty surrounding the viability of its two core businesses. The 
latter both need more capital to develop as well as to survive current
challenging market conditions.

The ratings outlook remains negative, reflecting the uncertainty
surrounding the viability of Titan and the prevalence of a high level of 
near-term liquidity risk, as it faces the challenge of raising adequate 
funding to support its businesses.

Given the current negative outlook and the company's tight liquidity 
profile, upward rating pressure is limited.

On the other hand, the ratings could be subject to further downward
pressure if it fails to meet its debt-repayment obligations.

The last rating action on Titan was 1 September 2008 when Moody's 
concluded a rating review which was commenced on 27 June 2008. Titan's 
corporate family rating was downgraded to Caa1 from B3 and the rating for 
its senior unsecured bond was downgraded to Caa2 from Caa1. The outlook 
for the ratings was changed to negative.

Titan's ratings have been assigned based on factors that Moody's believe
are relevant to the risk profile of Titan, such as the company's (i) 
business risk and competitive position compared with other firms within
the industry; (iii) capital structure and financial risk; (iii)
projected performance over the near to intermediate term; and (iv)
management's track record and tolerance for risk. These attributes were 
compared against other issuers both within and outside Titan's core
industry; Titan's ratings are believed to be comparable to those of 
other issuers of similar credit risk.

Titan Petrochemicals Group Ltd ("Titan") is an operator of oil & chemical
storage and shipyard businesses in China, together with bunkering
operations in Singapore, and floating oil storage in Malaysia. It was 
listed on the Hong Kong Stock Exchange in May 2002.