Changed pres. of income, and accumulation of pension rights

In the fourth quarter of 2000, Hydro changed the accounting treatment for the presentation of revenues related to some of its trading activities in the Aluminium Metal Products segment and for trading activities in petroleum products in the Energy segment. Revenues and related costs from these activities were previously accounted for on a margin basis and reported net, with the margin included in operating revenues. The change applies to the trade of physical commodities which are not net settled. These will now be presented on a gross basis in the income statement. The strategic significance and extent of trading activities in Hydro has heightened in recent years. In light of this, Hydro has decided that the information related to these underlying activities is best achieved by the presentation of revenues and the related costs on a gross basis. This has led to increased operating revenues and costs compared to prior years’ presentations. The change has no effect on net income, assets, or shareholders’ equity.

Activities related to the trading of financial derivative commodity instruments and physical commodities where net settlement occurs, will continue to be reported on a net basis, with the margin included in operating revenues.

The figures from previous years have been restated in accordance with the new presentation method. Operating revenues and operating costs increased by NOK 8,316 million and NOK 9,522 million in 1998 and 1999, respectively. The increase for the first nine months of 2000 is NOK 10,016 million. Restated figures may be downloaded fromwww.hydro.com, under the section "Investor Forum".

Transition to linear model for accumulation of pension rights

The new Norwegian legislation on company pension now requires a linear accumulation of pension rights for employees. Hydro has decided to introduce this principle with immediate effect for its employees based in Norway and members of Norsk Hydro’s pension trust scheme. The principle has been introduced for both the scheme that covers salary up to 12G (12 times the National Insurance base rate) and for groups who are entitled to pension above the level covered by the normal pension scheme.

This alteration does not have any effect on the presentation of pension in the consolidated accounts because the accounting standard for pension is based on linear accumulation. Hydro’s previous internal allocation of pension costs was not based on a linear model and the transition to linear accumulation has resulted in a deficit in the individual segment. To cover this deficit, Hydro has charged a non-recurring amount in the fourth quarter of 2000 to the units affected by this transition. The effect on the individual segments of this internal cost allocation is shown below. Some of these non-recurring costs are passed on to other companies outside of Hydro and the net effect of the transition is therefore an increase in the consolidated operating income for the fourth quarter of NOK 470 million.

The allocation of non-recurring costs in connection with the transition to a linear model for accumulation of pension is shown in the table below.

NOK Million                4th Quarter 2000

Exploration and Production  (366)

Energy		            (85)

Oil Marketing		      -

Hydro Oil and Energy        (451)



Aluminium Metal Products    (365)

Aluminium Extrusion         (9)

Other Light Metals          (86)

Hydro Light Metals          (460)



Plant Nutrition             (239)

Gas and Chemicals           (30)

KFK                          -

Hydro Agri                  (269)



Petrochemicals              (103)

Other Activities            (71)

Segments                   (1,354)

Corporate                   1,824

Total                       470