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Hitt og þetta 25. júlí 2006

Strong second quarter from Hydro

Consolidated results (US GAAP)

Second quarter First half Year 2006 2006 2005 2006 2006 2005 2005 Million, except NOK EUR¹) NOK NOK EUR¹) NOK NOK per share data Operating revenues 51,435 6,479 42,119 106,851 13,459 84,271 174,201

Operating income 14,640 1,844 11,255 32,507 4,095 23,009 46,432 Non-consolidated investees 372 47 246 688 87 459 619 Financial income (expense), net 919 116 (558) 1,679 211 (1,468) (1,890) Other income (loss), net (0) (0) 233 (0) (0) 233 990 Income before tax and minority interest 15,931 2,007 11,176 34,874 4,393 22,233 46,152

Income tax expense (10,454) (1,317) (7,429) (23,571) (2,969) (14,713) (30,317) Minority interest (83) (10) (169) (39) (5) (250) (118) Income before cumulative effect of change in accounting principles 5,394 679 3,577 11,263 1,419 7,270 15,716

Cumulative effect of change in accounting principles - - - - - - (78) Net income 5,394 679 3,577 11,263 1,419 7,270 15,638

Basic and diluted earnings per share before change in accounting principles (in NOK and Euro) 2) 4) 4.30 0.54 2.90 9.00 1.10 5.80 12.50 Basic and diluted earnings per share (in NOK and Euro) 2) 4) 4.30 0.54 2.90 9.00 1.10 5.80 12.50

Financial data Investments - million 4,801 605 4,558 9,245 1,165 8,022 41,110 Adjusted net interest-bearing debt/equity 3) 0.21 0.21 0.14 0.21 0.21 0.14 0.31 Debt/equity ratio 0.24 0.24 0.29 0.24 0.24 0.29 0.28

1) Presentation in Euro is a convenience translation based on the exchange rate at 30 June 2006, which was 7.9391. 2) Basic earnings per share were computed using the weighted average number of ordinary shares outstanding. There were no diluting elements. 3) Adjusted net interest-bearing debt divided by shareholders' equity plus minority interest, adjusted for unfunded pension obligation (after tax) and present value of future obligations on operating leases. 4) Previously reported earnings per share and total number of outstanding shares have been adjusted to reflect the 5-for-1 stock split effective 10 May 2006. All comparative figures are for the corresponding period in 2005 unless otherwise stated.

Hydro's net income for the second quarter of 2006 amounted to NOK 5,394 million (NOK 4.30 per share), compared with NOK 3,577 million (NOK 2.90 per share) in the second quarter of 2005. Net income for the first half of 2006 amounted to NOK 11,263 million (NOK 9.00 per share), compared with NOK 7,270 million (NOK 5.80 per share) for the first half of 2005.

Operating income for the second quarter of 2006 amounted to NOK 14,640 million, compared with NOK 11,255 million in the second quarter of 2005. The improved earnings were mainly driven by higher oil and gas prices together with higher aluminium prices. Operating income amounted to NOK 32,507 million for the first half of 2006, compared with NOK 23,009 million the first half of 2005, an increase of 41 percent.

Net cash provided by operating activities was NOK 23,142 milllion for the six months ended 30 June 2006, compared with NOK 11,752 million for the first half of 2005. Approximately NOK 6,500 million of the increase related to increased tax accruals which will be paid during the second half of 2006.

"Hydro reports strong second quarter earnings, reflecting continued high oil and gas prices as well as good cost control in an environment with significant cost pressure in most areas. However, the results were negatively affected by lower-than-expected oil and gas production," says Eivind Reiten, President and Chief Executive Officer.

"In our aluminium business we have another strong result upstream, with high production volumes and a robust market. The performance in Extrusion is good, with a notable increase in volumes at improved margin levels," says Reiten. "However, the results for Rolled Products and Automotive are not satisfactory, and further restructuring measures will be taken to secure cash generation and improved profitability."

Operating income for Oil & Energy amounted to NOK 13,168 million for the quarter. Hydro realized an average oil price of US dollar 67.9 per barrel in the second quarter of 2006, an increase of 36 percent compared with the second quarter of 2005, and an increase of 12 percent compared with the first quarter of 2006. Realized gas prices increased 37 percent to NOK 1.79 per standard cubic meter (Sm3) in the second quarter of 2006, compared with the second quarter of 2005, but decreased 17 percent compared with the first quarter of 2006 mainly due to lower spot prices. Oil and gas production averaged 537,000 barrels of oil equivalents (boe) per day during the second quarter of 2006, approximately the same level as in the second quarter of 2005, but down 73,000 boe per day from the first quarter of 2006. For the first half of the year, average oil and gas production increased to 573,000 boe per day, compared with 561,000 boe per day in the first half of 2005.

At the end of June, the Ormen Lange/Langeled project was 75 percent complete, in line with the schedule and budget. As planned, activity levels relating to offshore and onshore work will reach peak levels during this summer and fall season. Exploration activity proceeded at a high level during the second quarter of 2006. Hydro participated in a total of eight new discoveries in the Gulf of Mexico (GoM), on the Norwegian Continental Shelf (NCS) and in Libya.

Operating income for Hydro's total aluminium activities amounted to NOK 1,871 million for the second quarter of 2006, compared with NOK 1,338 million in the second quarter of 2005. The improved result primarily reflected higher aluminium prices.

During the first quarter of 2006, Hydro's Aluminium business area was divided into two separate business areas to ensure dedicated management focus on the challenges in each area. Implementation of the new organization was completed during the second quarter of 2006.

Operating income for Aluminium Metal amounted to NOK 1,620 million in the quarter, compared with NOK 1,166 million in the second quarter of 2005. Increased aluminium prices continued to have a positive impact on operating results. Hydro's realized aluminium price amounted to US dollar 2,368 per metric ton (mt) in the second quarter of 2006, an increase of 28 percent compared with the second quarter of 2005 and 10 percent higher than the first quarter of 2006. Measured in Norwegian kroner, the realized aluminium price increased by 24 percent, compared with the second quarter of 2005. Hydro's primary aluminium production amounted to 451,000 mt in the second quarter, relatively unchanged compared with the second quarter of 2005. Production losses due to the plant closures in Norway and Germany were mostly offset by increased production relating to the Alouette expansion in Canada and incremental improvements to existing capacity. Costs related to the closure of the primary metal plants amounted to NOK 309 million for the second quarter of 2006 primarily relating to the closure of the plant in Stade, Germany.

Aluminium Products operating income amounted to NOK 301 million for the quarter, compared with operating income of NOK 210 million in the second quarter of 2005. The improved results were positively influenced by higher volumes. However, overall margin developments were still negative, despite positive developments in the Extrusion sector. Results in the second quarter of 2006 were impacted by positive metal effects within Rolled Products of NOK 149 million. Costs relating to plant closures and write-downs amounted to NOK 185 million for the quarter.

In May 2006, Hydro decided to close its magnesium casthouse operations in Porsgrunn, Norway as a result of increasing low priced exports from Chinese producers into the European markets. Operations ceased at the plant in the second quarter of 2006.

Income tax expense for the first half of 2006 amounted to NOK 23,571 million, compared with NOK 14,713 million for the first half of 2005. This represents 68 percent and 66 percent of income before tax, respectively.

Investments amounted to NOK 4.8 billion for the quarter. Roughly 85 percent of the amount invested related to oil and gas operations.

Second quarter 2006

Non-cons. Operating inv., Other Depreciation Adjusted NOK million income Interest & income and EBITDA (loss) selected amortization fin.items Oil & Energy 13,168 114 - 3,042 16,325 Aluminium Metal 1,620 264 - 417 2,301 Aluminium Products 301 32 (0) 547 879 Other activities 221 8 (0) 108 337 Corporate and eliminations (670) 172 - (7) (505) Total 14,640 590 (0) 4,107 19,337

First half 2006

Non-cons. Operating inv., Other Depreciation Adjusted NOK million income Interest & income and EBITDA (loss) selected amortization fin.items Oil & Energy 27,294 207 - 6,221 33,722 Aluminium Metal 3,660 574 - 842 5,076 Aluminium Products 752 51 (0) 1,002 1,805 Other activities 335 118 (0) 218 672 Corporate and eliminations 466 369 - (4) 831 Total 32,507 1,319 (0) 8,280 42,106

Quarterly results

2006 2005 NOK million, except per share 2nd qtr 1st qtr 4th qtr 3rd qtr 2nd qtr 1st qtr data Operating revenues 51,435 55,416 45,318 44,612 42,119 42,152 Operating income 14,640 17,867 10,450 12,973 11,255 11,754 Income before cumulative effect of change in accounting principles 5,394 5,869 4,264 4,183 3,577 3,693 Earnings per share before cumulative effect of change in accounting principle (in NOK) 1) 4.30 4.70 3.40 3.30 2.90 2.90

1) Previously reported earnings per share and total number of outstanding shares have been adjusted to reflect the 5-for-1 stock split effective 10 May 2006.

Outlook

Oil & Energy Oil and gas prices are expected to remain high in 2006. Hydro has revised its oil and gas production target for 2006 from 615,000 to 585,000 boe per day. The reduction of 30,000 boe per day is divided equally between Hydro's Norwegian and international portfolios and is mainly due to unexpected developments in Norway, Canada and GoM and somewhat lower gas export from Norway than planned. The reduction excludes any potential effects of the ongoing oil services strike on the NCS. The action, which began 21 June, has so far had a limited effect on production on the NCS, but is affecting production drilling and well activities for the industry as a whole.

Exploration activity is expected to remain high throughout 2006. In the second quarter of 2006, Hydro signed a contract with Transocean Inc. for deepwater drilling capacity in the GoM for the period from 2007 to 2013. The agreement will secure capacity in the medium and long-term for Hydro's exploration program in the GoM.

Aluminium The general economic outlook for the second half of 2006 remains positive, but growth in the US may slow toward the end of the year. Global consumption and production of primary aluminium are each expected to increase in 2006 by approximately 5 - 6 percent. The market for primary metal is expected to remain fairly balanced with the main uncertainties relating to developments in China and in alumina and energy prices.

Market volume developments are expected to remain positive within the rolled products and extrusion sectors influenced by growth in overall industrial production and restocking of customer inventories.

During 2006 the global magnesium market has continued to weaken from an already poor level in 2005. Competition from Chinese magnesium producers has resulted in an oversupply of magnesium on the world market, driving prices down. Hydro sees limited potential for an improvement in this market and will take further measures to reduce its exposure in this area.

***** Certain statements contained in this announcement constitute "forward-looking information" within the meaning of Section 27A of the US Securities Act of 1933, as amended, and Section 21E of the US Securities Exchange Act of 1934, as amended. In order to utilize the "safe harbors" within these provisions, Hydro is providing the following cautionary statement.

Certain statements included within this announcement contain (and oral communications made by or on behalf of Hydro may contain) forward-looking information, including, without limitation, those relating to (a) forecasts, projections and estimates, (b) statements of management's plans, objectives and strategies for Hydro, such as planned expansions, investments, drilling activity or other projects, (c) targeted production volumes and costs, capacities or rates, start-up costs, cost reductions and profit objectives, (d) various expectations about future developments in Hydro's markets, particularly prices, supply and demand and competition, (e) results of operations, (f) margins, (g) growth rates, (h) risk management, as well as (i) statements preceded by "expected", "scheduled", "targeted", "planned", "proposed", "intended" or similar statements.

Although Hydro believes that the expectations reflected in such forward-looking statements are reasonable, these forward-looking statements are based on a number of assumptions and forecasts that, by their nature, involve risk and uncertainty. Various factors could cause Hydro's actual results to differ materially from those projected in a forward-looking statement or affect the extent to which a particular projection is realized. Factors that could cause these differences include, but are not limited to, world economic growth and other economic indicators, including rates of inflation and industrial production, trends in Hydro's key markets, and global oil and gas and aluminium supply and demand conditions. For a detailed description of factors that could cause Hydro's results to differ materially from those expressed or implied by such statements, please refer to the risk factors specified under "Risk, Regulation and Other Information - Risk Factors" on page 92 of Hydro's Annual Report and Form 20-F 2005 and subsequent filings on Form 6-K with the US Securities and Exchange Commission.

No assurance can be given that such expectations will prove to have been correct. Hydro disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Contact Press contact Press contact Investor contact Norsk Hydro Telephone Cecilie Ditlev-Simonsen Tor Steinum Idar Eikrem ASA Cellular +47 22532097 +47 22532731 +47 22533273 Drammensveien E-mail +47 41559250 +47 95083933 +47 95028363 264 Cecilie.Ditlev-Simonsen@hydro.com Tor.Steinum@hydro.com Idar.Eikrem@hydro.com N-0240 Oslo Norway Telephone: +47 22 53 81 00 Fax: +47 22 53 27 25 www.hydro.com