EXHIBIT 99.2
FRIDAY AUGUST 7, 3:02 PM EASTERN TIME
COMPANY PRESS RELEASE
SOURCE: Syntroleum Corporation
SLH AND SYNTROLEUM COMPLETE MERGER
MERGER PROVIDES CAPITAL TO ACCELERATE COMMERCIAL DEVELOPMENT OF SYNTROLEUM
PROCESS AND FUND CONSTRUCTION OF GAS-TO-LIQUIDS PLANTS
TULSA, Okla., Aug. 7 -- Syntroleum Corporation today announced that it has
completed its merger with SLH Corporation which, prior to the merger owned
approximately 31% of the outstanding common shares of Syntroleum. The merger
was approved by the shareholders of both companies at separate meetings held
yesterday.
Among other things, the merger gives the combined company, which will be called
Syntroleum Corporation, access to approximately $50 million of cash and other
assets formerly held by SLH. Syntroleum intends to use this capital to
accelerate the development and commercial implementation of its proprietary
process designed to catalytically convert natural gas into synthetic crude oil
and other hydrocarbon-based products.
In the merger, each outstanding share of Syntroleum common stock was converted
into 1.28990 shares of SLH common stock. As a result, pre-merger shareholders
of Syntroleum own 62.5% of the combined company and pre-merger shareholders of
SLH own the remaining 37.5%. Approximately 16,825,000 shares of SLH common
stock were issued in the merger, resulting in a total of approximately
26,900,000 outstanding shares after the merger. The last trading day for the
common shares of SLH will be today, August 7, 1998. Shares of Syntroleum common
stock will begin trading on August 10, 1998 on Nasdaq under the trading symbol
"SYNM".
"With the financial resources and access to capital provided by this
transaction, Syntroleum can now move aggressively to bring our gas-to-liquids
technology to the energy market and capitalize on the significant opportunities
we see there," said Kenneth Agee, Syntroleum's Chairman and Chief Executive
Officer. With the assets provided by the merger, we now have capital to push
the development of our commercial plants forward.
Mark Agee, Syntroleum's President, added, "As a result of becoming a publicly
traded company after the merger, our current and potential shareholders,
licensees, business partners and employees will now have access to much greater
information about Syntroleum, its strategy and its prospects. We believe this
will work to the benefit of all concerned."
"We are also convinced that our business model, which combines the considerable
capabilities of our own R&D and engineering staffs with those of our licensees
and technology partners, creates a clear and compelling competitive advantage
for Syntroleum," said Mark Agee.
Syntroleum plans to use a portion of the cash made available by the merger to
fund its capital commitments for two previously announced gas-to-liquids
projects -- a specialty product GTL plant being developed with Enron Capital &
Trade Resources in Sweetwater County, Wyoming, and a second GTL plant being
developed with Texaco and the engineering firm of Brown & Root. The company
also intends to continue to make significant investments in the research and
development of improvements to the Syntroleum Process.
The Syntroleum Process
The Syntroleum Process is a simplification of traditional GTL technologies aimed
at substantially reducing both the capital cost and minimum economical size of a
GTL plant, as well as plant operating costs. To this end, a unique
characteristic and primary advantage of the Syntroleum Process over competing
processes is its use of air, rather than pure oxygen, in the conversion process.
Syntroleum believes that the Syntroleum Process can, in some circumstances, be
cost effective in GTL plants with throughput levels as low as 2,000 barrels per
day (based on energy prices in recent years), and can be competitive with other
GTL processes at any plant size. Syntroleum believes its ability to scale plant
size down will enable it to place its GTL plants in skids, barges and
ocean-going vessels. This is expected to allow Syntroleum licensees to use GTL
plants in a wider variety of locations, including isolated and offshore areas
where much of the world's stranded gas reserves are found.
The potential for small and portable plants also makes Syntroleum's GTL
technology more suitable for converting natural gas associated with oil fields
that would otherwise be flared (which is now prohibited or severely restricted
in many countries) or reinjected into the reservoir at significant cost. In
addition, the synthetic crude oil produced by the Syntroleum Process has certain
performance and environmental advantages over conventional crude oil.
Syntroleum's Strategy
Syntroleum's objective is to be a leading GTL technology provider to the oil and
gas industry. Its strategy to achieve this objective involves the following key
elements:
Broadly License the Syntroleum Process. Syntroleum intends to continue
offering licenses to the Syntroleum Process and related proprietary
catalysts to the oil and gas industry for the production of synthetic
crude oil and liquid fuels primarily outside of North America.
To date, Syntroleum has entered into license agreements with Texaco, ARCO,
Marathon, YPF, Enron, and Kerr-McGee, and is currently in discussions with
several other oil and gas companies with respect to additional license
agreements.
Own Specialty Product GTL Plants. Syntroleum intends to establish joint
ventures with its licensees and other oil and gas industry partners and/or
financial partners to design, construct and operate GTL plants designed to
produce high margin specialty products.
Syntroleum has formed a joint venture with Enron with respect to the
development of a proposed 8,000-barrel per day GTL plant in Sweetwater
County, Wyoming. The company is currently in discussions with several
other potential participants in this joint venture. Syntroleum has also
entered into a project development agreement with Texaco and Brown & Root
with respect to the development of a small GTL plant.
Provide Mobile GTL Plants on a Contract Basis. Syntroleum intends to make
mobile GTL plants available to customers on a contract basis through
efforts with industry partners and others. Syntroleum believes that there
will be a significant market potential for mobile GTL plants in various
applications, including (i) extended well testing; (ii) conversion of
small associated gas fields; and (iii) short-term use of a GTL plant on
large fields while a permanent GTL plant is being built.
Continue Reducing Costs Through Research and Development Activities and
Acquisitions. Syntroleum intends to continue its research and development
activities with a focus on developing further improvements to the
Syntroleum Process and further reducing the capital and operating costs of
GTL plants based on the Syntroleum Process.
Syntroleum has leveraged its own research and development capabilities
through joint development arrangements with its licensees and other
industry partners. Texaco, ARCO, Marathon, Bateman Engineering, Brown &
Root, ABB Power Generation and ABB STAL AB, AGC Manufacturing Services,
Catalytica Combustion Systems and Catalytica Advanced Technologies are
currently participating in specific joint development projects with
Syntroleum.
Syntroleum believes that the network created through its license and joint
development agreements, along with its strategic alliances with
engineering companies and critical component vendors, will allow it to
more rapidly commercialize and improve the Syntroleum Process, thereby
providing it and its licensees with an important competitive advantage and
enhancing Syntroleum's ability to attract additional licensees and joint
development partners. Under these agreements, Syntroleum generally
acquires title to or rights to use all inventions and improvements to the
Syntroleum Process that results from these collaborative efforts. Those
improvements are then made available to all licensees.
This document includes forward-looking statements as well as historical
information. Forward-looking statements include, but are not limited to,
statements relating to the use of funds provided by the merger, the Syntroleum
Process and related technologies, GTL plants based on the Syntroleum Process
(including the development of planned plants), the economic use of such plants
and the continued development of the Syntroleum Process. When used in this
document, the words "anticipate," "believe," "estimate," "expect," "intent,"
"may," "project," "plan," "should," and similar expressions are intended to be
among the statements that identify forward-looking statements. Although
Syntroleum believes that its expectations reflected in these forward-looking
statements are reasonable, such statements involve risks and uncertainties and
no assurance can be given that actual results will be consistent with these
forward-looking statements. Important factors that could cause actual results to
differ from these forward-looking statements include the potential that
commercial-scale GTL plants will not achieve the same results as those
demonstrated on a laboratory or pilot basis or that such plants will experience
technological and mechanical problems, the potential that improvements to the
Syntroleum Process currently under development may not be successful, the impact
on plant economics of operating conditions (including energy prices),
competition, intellectual property risks, Syntroleum's ability to obtain
financing and other risks described in the company's filings with the Securities
and Exchange Commission.
(R) "Syntroleum" is registered as a trademark and service mark in the U.S.
Patent and Trademark Office.