First Quarter 2007 Earnings Conference Call

May 14, 2007

2

Certain information in this presentation may be considered forward-looking information within the meaning of the Private Securities Litigation Reform Act of 1995. This information is based on the Company's current expectations and 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 filings with the Securities and Exchange Commission. These risks and uncertainties include, but are not limited to, industry and economic conditions, competitive, legal, governmental and technological factors. There is no assurance that the Company's expectations will be realized. The Company assumes no obligation to update any forward-looking information contained in this presentation should circumstances change, except as otherwise required by securities and other applicable laws.

This presentation contains non-GAAP financial measu res. A reconciliation to the nearest U.S. GAAP financial measures is included at the end of the presentation.

Forward-Looking Statements

Overview of First Quarter Results

Craig O. MorrisonChairman, President & Chief Executive Officer

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First Quarter 2007 Highlights

Hexion delivered a strong performance in Q107

� Revenues increased 17% over prior year. Revenues increased 10%, net of acquisitions, compared to prior year

� Q107 operating income of $104 million compared to $110 million in prior year quarter. Last year’s earnings, however, included a gain of $37 million on the sale of non-core assets, net of which operating income was up 42 percent

� Segment EBITDA(1) reached $170 million, a 29% increase compared to prior year

Hexion’s global diversification and technical service model has allowed it to offset the downturn in North American housing and automotive markets

Flattening raw material prices have allowed the pricing, synergies and productivity initiatives to flow to the bottom line

Hexion remains on track to achieve $175 million in targeted synergies

The Orica integration further diversified Hexion within the Asia Pacific Forest Products region and is proceeding smoothly

Hexion’s Q107 results delivered a pro forma adjusted EBITDA of $679 million and an interest coverage ratio of 2.34

Hexion Continues to Execute its Strategic and Operational Plan(1) Segment EBITDA and Adjusted EBITDA are non-GAAP financial measures. The closest GAAP financial measure is Net Income (Loss). A table that reconciles these two measures is at the end of

this presentation. Management believes that Adjusted EBITDA is meaningful to investors because maintaining a minimum ratio of Adjusted EBITDA to Fixed Charges is a covenant that is contained in Hexion’s loan agreements. Last Twelve Month (LTM) Adjusted EBITDA includes $94 million of in-process Hexion synergies and $23 million of acquisition adjustments.

5

Quarterly Results Driven by Diversified Portfolio and Global Customer Base

nm435Net income

170

104

$1,438

2007

(5%)110Operating Income

↑↑↑↑ 29%

↑↑↑↑ 17%

∆∆∆∆

132

$1,233

2006

Segment EBITDA (1)

Revenue

($ in millions)

Hexion Results Quarter Ended March 31

(1) Segment EBITDA excludes in-process synergies and the pro forma effect of acquisitions.

Q106 includes $37 million gain on the sale of non-core assets

Q106 includes $31 million gain on an after-tax basis on sale of non-core assets

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Strong Revenue Growth in Q107

16%

10%

11%

32%

Net Sales

Performance Products

Coatings& Inks

Forest & Formaldehyde

Products

Epoxy & Phenolic

Resins

1Q07 vs. 1Q06

Continued AcrossContinued Across--thethe--Board Segment Revenue GrowthBoard Segment Revenue Growth

Summary:

� An emphasis on price initiatives drove strong revenue growth across all segments

� Robust volumes in specialty product lines drove positive mix

� Coatings and Inks results largely driven by Akzo and Rhodiaacquisitions

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26%

32%

13%

Segment EBITDA Trends Positive in Q107

Segment EBITDA

1Q07 vs. 1Q06

25%

FFP

C & I

PP

EPRD

Summary:

� Strong Segment EBITDA improvement across all areas of portfolio.

� EPRD driven by a robust epoxy market and disciplined pricing strategies

� FFP offset the N. American housing downturn through global diversification and flattening raw material prices

� SG&A expenses as percentage of sales improved to 6.95% in Q107 compared to 7.62% in Q106

� EBITDA margin improvement of 100 basis points driven by ongoing pricing and synergies(1) Segment EBITDA excludes in-process synergies and the pro forma effect of acquisitions.

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1.0

1.1

1.2

1.3

1.4

Volatile Raw Material Environment in Q107

Hexion Composite Raw Material IndexHexion Composite Raw Material Index

Source: CMAI data.20072006

Q1Q4Q3Q2Q1

A flattening of the raw material index allowed for pricing, synergy and productivity initiatives to fall to the bottom line.Total Hexion composite raw material index increased 24% year-over-year Q107 average prices compared to Q106: phenol ↑↑↑↑ 17%, methanol ↑↑↑↑ 56%, and urea ↑↑↑↑ 35%Contractual lead-lag: $1 million positive impact in Q107Ongoing focus on pricing actions to compensate for the rapid rise in raw materialsAnticipate favorable trends over balance of 2007, but prices remain volatile

Certain Key Raws Currently Remain at or near Historical Highs

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On Track to Achieve $175 Million in Synergies

Sourcing M anufacturing SG&A

$155

$20

As of FY05

$105

$70

As ofFY06

As ofQ107

$94Unrealized Synergies

$81Achieved Synergies

Achieved($ millions)

$70

Hexion Continues to Achieve Targeted Synergies

Summary:

� Achieved $11 million in targeted synergies in Q107

� Anticipate achieving $125 million in synergies by year-end 2007

� Synergy achievement remains an ongoing focus of senior management team

FY ’06A FY ’07Est.

$125

SourcingManufacturingSG&A

Targeted Synergy Focus Areas

$75 mm

$67 mm

$33 mm

Financial Review

William CarterExecutive Vice President & Chief Financial Officer

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Epoxy and Phenolic Resins Segment Highlights

$73

$526

2006

↑↑↑↑ 32%$96 Segment EBITDA

↑↑↑↑ 11%

∆∆∆∆

$582

2007

Revenue

($ in millions)

Quarter Ended March 31

Q107 Sales Comparison YOY

11%--6%6%(1%)

TotalAcquisitions/Divestitures

CurrencyTranslation

Price/MixVolume

Some relief in phenol pricing sequentially from Q406 and solid demand in Q107 from certain product lines helped improve segment margins

Continued strength in European and Specialty Epoxy businesses

Strong performance in versatic acid and derivatives

12

Formaldehyde and Forest Product Resins Segment Highlights

$34

$356

2006

↑↑↑↑ 26%$43 Segment EBITDA

↑↑↑↑ 16%

∆∆∆∆

$413

2007

Revenue

($ in millions)

Segment results driven by our ability to pass through higher phenol and methanol costs, strong international volumes and cost control initiatives

Orica and Wright Chemical added $3.4 million in Q107 Segment EBITDA

Quarter Ended March 31

Q107 Sales Comparison YOY

16%5%1%19%(9%)

TotalAcquisitions/Divestitures

CurrencyTranslation

Price/MixVolume

13

Coatings and Inks Segment Highlights

$20

$260

2006

↑↑↑↑ 25% $25 Segment EBITDA

↑↑↑↑ 32%

∆∆∆∆

$343

2007

Revenue

($ in millions)

Stronger pricing partially offset by N. American housing market adversely impacting coating volumes

Additional progress in site rationalization efforts in Hamburg (Germany), Mölndal (Sweden) and Lynwood, California

Site rationalizations underscore move for Hexion to bolster waterborne and powder coating systems versus solvent-borne technologies

Quarter Ended March 31

Q107 Sales Comparison YOY

32%26%5%6%(5%)

TotalAcquisitions/Divestitures

CurrencyTranslation

Price/MixVolume

14

Performance Products Segment Highlights

$ 16

$91

2006

↑↑↑↑ 13%$18 Segment EBITDA

↑↑↑↑ 10%

∆∆∆∆

$100

2007

Revenue

($ in millions)

Oilfield products continued to deliver strong volume and pricing performance

Segment volume decline driven primarily by foundry products reflecting theN. American auto slowdown

Quarter Ended March 31

Q107 Sales Comparison YOY

10%--1%10%(1%)

TotalAcquisitions/Divestitures

CurrencyTranslation

Price/MixVolume

15

Balance Sheet Update

Net Debt Outstanding as of Q107 Totals $3.4 Billion Net Debt Outstanding as of Q107 Totals $3.4 Billion

Q107 cash flow impacted by:

�Acquisition of Orica Adhesives & Resins business(Accounted for $63 million of $110 million increase in borrowings)

�Working capital investments in business growth, including global wind energy markets

Maintaining capital expenditure targets of $120 million in 2007

Cash plus borrowing availability of $187 million at March 31, 2007

Summary

Craig O. Morrison

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Summary

Strong quarterly revenue and Segment EBITDA performance compared to prior year period from Hexion’s diversified portfolio and demand from international markets

Continued focus on pricing actions to recapture the escalating raw material trend

Progress toward completing $175 million in synergies continues as planned

Hexion continues to focus on expanding its international footprint

� Orica integration is proceeding smoothly following February 1st transaction completion

Hexion’s Q107 results delivered a pro forma adjusted EBITDA of $679 million and an interest coverage ratio of 2.34

Hexion Continues to Execute its Strategic and Operational Plan

Appendix

19

Epoxy and Phenolic Resins 96 73

Formaldehyde and Forest Product Resins 43 34

Coatings and Inks 25 20

Performance Products 18 16

Corporate and Other (12) (11)

Total 170 132

Reconciliation:

Items not included in Segment EBITDA

Transaction costs (3)

Integration costs (9) (10)

Non-cash charges (6) (7)

Unusual items:

Gain on sale of business 37

Purchase accounting effects/inventory step-up (1)

Business realignments (6)

Other (1) (2)

Total unusual items (7) 34

Total adjustments (22) 14

Interest expense, net (76) (54)

Income tax benefit (expense) (21) (19)

Depreciation and amortization (47) (38)

Net income (loss) 4 35

Reconciliation of Non-GAAP Financial Measures

Three months ended March 31

2007 2006

$

$ $

$

Segment EBITDA

20

Reconciliation of Net Loss to Adj. EBITDA

Net loss (109) (140)

Income taxes 14 16

Interest expense, net 242 264

Loss from extinguishment of debt 121 121

Depreciation and amortization expense 171 180

EBITDA 439 441

Adjustments to EBIT DA

Acquisitions EBITDA (1) 35 23

Transaction costs (2) 20 17

Integration costs (3) 57 56

Non-cash charges (4) 22 21

Unusual items:

Gain on divestiture of business (39) (2)

Purchase accounting effects/inventory step-up 3 2

Discontinued operations 14 14

Business realignments (2) 4

Other (5) 10 9

Total unusual items (14) 27

In process Synergies (6) 105 94

Adjusted EBITDA (7) 664 679

Fixed Charges (8) 290 290

Ratio of Adj. EBITDA to Fixed Charges 2.29 2.34

Year ended Dec. 312006

$ $

Fixed Charge Covenant Calculations

LTM Period

$ $

21

Fixed Charge Covenant Calculations cont.

Footnotes

(1) Represents incremental EBITDA from the Orica adhesives & resins (A&R) acquisition as if it had taken place at the beginning of the period.

(2) Represents the write-off of deferred accounting, legal and printing costs from the Company’s proposed IPO, as well as costs associated with terminated acquisition activities.

(3) Represents redundancy and plant rationalization costs and incremental administrative costs from integration programs. Also includes costs to implement a single, company-wide management information and accounting system.

(4) Includes non-cash charges for impairments of fixed assets, stock-based compensation, and unrealized foreign exchange and derivative losses.

(5) Includes the impact of the announced exit from the European solvent coating resins business, one-time benefit plan costs and management fees.

(6) Represents estimated net unrealized synergy savings resulting from the Hexion formation.

(7) We are required to have an Adjusted EBITDA to Fixed Charges ratio of greater than 2.0 to 1.0 to incur additional indebtedness under our indenture for the Second Priority Senior Secured Notes. As of March 31, 2007, we were able to satisfy this covenant and incur additional indebtedness under this indenture.

(8) The fixed charges reflect pro forma interest expense as if the Orica A&R Acquisition and the amendment of our May 2006 senior secured credit facilities, which occurred on January 31, 2007 and November 3, 2006, respectively, had taken place at the beginning of the period.

22

Debt Outstanding at March 31, 2007

6256259.75% Second-priority senior secured notes due 2014

200200Floating rate second-priority senior secured notes due 2014

3,494

114

11

34

78

247

115

1,990

80

3/31/2007

3,392Total debt

64Other

11Capital Leases

34Industrial Revenue Bonds due 2009

Other Borrowings:

78Sinking fund debentures: 8.375% due 2016

2477.875% debentures 2023

1159.2% debentures due 2021

Debentures:

1,995Floating rate term loans due 2013

Credit Agreements:

Senior Secured Notes:

23Revolving Credit Facilities

12/31/2006

($ in millions)

$ $

$ $