Sao Paulo, Brazil, 08 March 2007 -- Aracruz Celulose learned last week that the Minister of Justice, Márcio Thomas Bastos, returned the process regarding an increase in the size of indigenous reservations in Espírito Santo to the National Indian Foundation (FUNAI). In his explanation the minister told the agency to widen the studies "with a view towards preparing an appropriate recommendation that assuages the interests of both parties."

The Minister´s decision was made after analysis of FUNAI´s recommendations to increase the indigenous reservation by more than 11,000 hectares, using land almost entirely belonging to Aracruz Celulose, and of the company´s contestation of this recommendation.

Aracruz believes that the decision of the minister now gives FUNAI the opportunity to propose a solution that definitively ends the dispute, establishing the necessary legal assurances and creating the conditions for fostering the economic and social development of the communities.

The company respects the communities around it, recognizing them as important stakeholders. Aracruz is seeking to establish a constructive and long-lasting relationship with the Indians, respecting the law and the democratic practices of the country.