Tim S. NichollsSenior Vice President & Chief Financial Officer

JPMorganBasics and Industrials Conference

June 2008

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Forward-Looking Statements

These slides and statements made during this presentation contain forward-looking statements. These statements reflect management's current views and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied in these statements. Factors which could cause actual results to differ relate to: (i) our ability to realize the expected benefits of our proposed acquisition of the containerboard, packaging and recycling business of Weyerhaeuser Company in light of integration difficulties and other challenges; (ii) increases in interest rates and our ability to meet our debt service obligations; (iii) industry conditions, including but not limited to changes in the cost or availability of raw materials and energy, transportation costs, competition we face, the company's product mix, demand and pricing for its products; (iv) global economic conditions and political changes, particularly in Latin America, Russia, Europe and Asia, including but not limited to changes in currency exchange rates, credit availability, pension and health care costs and the company's credit ratings issued by recognized credit rating organizations; (v) unanticipated expenditures related to the cost of compliance with environmental and other governmental regulations and to actual or potential litigation; (vi) whether we experience a material disruption at one of our manufacturing facilities; and (vii) the company's ability to realize anticipated profit improvement from its transformation plan. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. These and other factors that could cause or contribute to actual results differing materially from such forward looking statements are discussed in greater detail in the company's Securities and Exchange Commission filings.

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During the course of this presentation, certain non-U.S. GAAP financial information will be presented.A reconciliation of those figures to U.S. GAAP financial measures is available on the company’s website at “www.internationalpaper.com” under Investors.

Non-GAAP Statements

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Agenda

Transformation Update

Industrial Packaging

Uncoated Freesheet

International Operations

5

International Paper Overview

Leading global paper & packaging company$22 Billion in 2007 revenues50,000+ employeesOperations in 20 countriesExecuting major transformation

6

Focus Portfolio

Improve Balance Sheet

Strengthen Existing

BusinessesSelective

Reinvestments

Return Valueto Shareholders

Transformation PlanFocus on Execution

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Focused Business PortfolioPro Forma Sales Revenue

Printing Papers

Packaging

xpedx

Carter Holt HarveyKraft Papers

Arizona ChemicalKraft Packaging

Coated PapersWood Products

Forestland

Printing Papers

Packaging

xpedx

Forest Resources

Forest Resources

2005 - $24.1B 2007 - $27.1B

2007 revenue figures include Weyerhaeuser CBPR revenues

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$1.33

$2.22

$0.70

2005 2006 2007

Transformation Plan ScorecardEarnings Per Share

Earnings from continuing operations before special itemsA reconciliation to GAAP EPS is available at www.internationalpaper.com under the Investors tab at presentations

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$1.3$1.1

$1.0$1.1 $1.1

$1.6

2007 2008P 2009P

Capex Depreciation & Amortization

Transformation Plan ScorecardCapex % of Depreciation

2009P depreciation includes $200 million in capex for the Weyerhaeuser assets and $500 million in incremental depreciation for the Weyerhaeuser assets

118% 100% 63%

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First Quarter 2008 Highlights

VolumesWeakened in North AmericaHeld up outside NA

PricesImproved globally

Input CostsEscalated globally

Improved free cash flow

Lower Forest Products earnings

Ilim’s 4Q07 earnings on track

$0.30$0.41 $0.37

$0.15

$0.28

$0.04

1Q07 4Q07 1Q08Forest Products EPSOperating Business EPS

$0.45$0.41

$0.69

Earnings from continuing operations before special items

Industrial Packaging

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Weyerhaeuser CBPR Acquisition Status Update

On Track3rd-Quarter Closing

In ProcessForeign Regulatory Approvals

Hart-Scott-Rodino Approval

Financing

Integration Planning

In ProcessTransitional Services

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Weyerhaeuser Acquisition Financing

Original Financing Plan

$2 Billion5-Year Term Loan

$2.5 Billion5-Year Term Loan

$4 Billion18-Month Bridge Loan

$3.0 BillionBond Offering

$0.5 BillionCash

Current Financing Plan

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Weyerhaeuser CBPR Acquisition Creating the Leading Global Supplier

Increases Cash Flow

Compelling Valuation

Well-Maintained, Quality Assets

Consistent with Transformation Plan

Significant Synergies

Low Integration Risk

Improves Core Business

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Strengthening International PaperHigher Earnings on Reduced Capital

12.8%

$20.2

$2.8

$21.9

IP 2007

11.6%

$27.5

$2.8

$24.1

Pre-Transformation

IP 2005(1)

14.4%(3)

$26.2

$3.9(3)

$27.1

2007 IP + WY with Run Rate

Synergies

EBITDA(2)

Margin

Capital Employed($ Billion)

EBITDA(2)

($ Billion)

Sales($ Billion)

(1) Before Transformation Plan discontinued operations(2) Excludes special items(3) Calculated as IP 2007 EBITDA of $2.8 billion plus CBPR 2007 EBITDA of $0.7 billion plus $0.4 billion in run-rate

synergies

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Weyerhaeuser CBPR Acquisition Improving Earnings Quality

2005EBITDA - $2.8B

2007 Pro Forma with Weyerhaeuser Assets

EBITDA - $3.9B(1)

Printing Papers

Packaging

Forest Products

Distribution

Arizona Chemical

Coated Papers

Wood Products

Beverage Packaging

Printing Papers

Packaging

Forest Products

Distribution(1) Calculated as IP 2007 EBITDA of $2.8 billion plus CBPR 2007 EBITDA of $0.7 billion plus $0.4 billion in run-rate

synergies

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North American Containerboard

JS7%

WY7%

IP7%

GP9%TIN

7%

Other50%

SC13%

SSCC19%

IP13%

TIN10%

PCA6%

Other26%

GP10%

WY16%

1995 Source: AF&PA, Company Reports, IP Analysis

1995 Producer PositionTop 3 = 29%Top 6 = 50%

2007 Producer PositionTop 3 = 48%Top 6 = 74%

2007 Source: RISI

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Source: Pöyry CostTrac – 4th Quarter, 200742# and 26# Global Kraft Linerboard cash cost per ton delivered to ChicagoHenderson, Savannah 8, Mansfield 3 and Pensacola based on 26#

0

200

400

600

800

1000

Industry Capacity (tons)

Prattville 2Prattville 1

Mansfield 3Mansfield 1

VicksburgPineville

Savannah 6Pensacola

Savannah 8

Cedar Rapids Campti 2Valliant 1

Campti 1Pine Hill 1 Valliant 3

Henderson Albany 3Albany 2

Springfield

WY MillIP Mill

$/ton

Combined Containerboard System 85% of Capacity in 1st & 2nd Quartiles

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310

360

410

460

510

560

610

$ / T

on

2002 2003 2004 20072000 2001 2005 2006

North American Industry Selling Prices42 lb. Kraft Linerboard

Sources: Selling Prices - RISI U.S. data, Margins – International Paper Industrial Packaging

Quarterly average sales price Trendline price

2008

18% Margin10% Margin

8% Margin

20

($150)

($100)

($50)

$0

$50

$100

$150

$200

$250

2003 vs. 2002 2004 vs. 2003 2005 vs. 2004 2006 vs. 2005 2007 vs. 2006 1Q08 vs. 1Q07

Millio

n

Price Increases / Decreases Input Cost Increases

IP Cost Inflation vs. Price RealizationNorth American Industrial Packaging

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Vicksburg MillRepairing Recovery Boiler

Savannah

Prattville

Mansfield

Pensacola Vicksburg

Pineville

IP Containerboard System5.1 million tons

11%

Uncoated Freesheet

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Global Leader in Uncoated PapersLeading Positions Across the Globe

Brazil 0.8 MM tpy

N. America 3.4 MM tpy

W. Europe0.6 MM tpy E. Europe & Russia

0.7 MM tpy

Uncoated paper mill

Capacity in short tons; does not include Ilim joint venture paper capacity

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North American Uncoated FreesheetStructural Changes

GP17%

IP12%

Boise9%

Champion9%Willamette

9%

WY8%

Other36%

Domtar32%

IP26%

Boise10%

GP7%

Glatfelter4%

Wausau3%

Other18%

1998 Source: Company Reports, IP Analysis

1998 Producer PositionTop 3 = 38%Top 6 = 64%

2007 Producer PositionTop 3 = 68%Top 6 = 82%

2007 Source: RISI

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Uncoated Freesheet Cost Curve94% of Capacity in 1st & 2nd Quartiles

0

200

400

600

800

1000

1200

1400

0 3,000 6,000 9,000 12,000 15,000 18,000 21,000 24,000 27,000 30,000 33,000Cummulative Annual Capacity (000 Short Tons)

Man

ufac

turi

ng C

osts

($/S

hort

Ton

)

Cash + Delivery to Chicago

Georgetown 1

Based on Poyry’s 2007 CostTrac model at 1st Quarter, 2008, Prices and Exchange Rates.

Franklin 3

Franklin 4

Eastover 2

Eastover 1

Courtland 35

Courtland 30, 34

Franklin 5Franklin 6

Riverdale 16

Riverdale 15

Ticonderoga 7

Ticonderoga 8

26

650

700

750

800

850

900

950

1000

1050

$ / T

on

2002 2003 20042000 2001 2005 2006

North American Industry Selling Prices20 lb. Copy Paper

Source: RISI U.S. data Quarterly average sales price Trendline price

2007 2008

12% Margin 8% Margin

11% Margin

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($50)

$0

$50

$100

$150

$200

$250

2003 vs. 2002 2004 vs. 2003 2005 vs. 2004 2006 vs. 2005 2007 vs. 2006 1Q08 vs. 1Q07

Millio

n

Price Increases / Decreases Input Cost Increases

IP Cost Inflation vs. Price RealizationNorth American Printing Papers

International Operations

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Sun Paper Joint Venture

2 machines - 470,000 TPY

3rd machine - 355,000 TPY

High demand growth region

Low-cost manufacturing

New Sun Coated Paperboard Machine

IP-Sun JV,Yanzhou

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0

200

400

600

800

1000

1200

1400

1600

0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000Cummulative Annual Capacity (000 Metric Tonnes)

Man

ufac

turi

ng C

osts

($/M

etri

c T

onne

)

Total Costs + Delivery to Shanghai

Based on Poyry’s 2007 CostTrac model at 1st Quarter, 2008, Prices and Exchange Rates.Sun JV costs are from IP estimates. Delivery includes $44 per metric ton for imports into China.

JV 17

JV 18

Coated Paperboard Global Cost CurveFolding Carton

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IP Brazil Transforming Earnings and Margins

32%

$217

$684

2005

32%

$272

$850

2007

27%

$135

$495

2006

EBITDA Margin

EBITDA

Sales Revenue

Note: 2005 results include sales and earnings from divested business

High demand growthLow-cost manufacturingLeading market position

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0

200

400

600

800

1000

1200

1400

1600

0 3,000 6,000 9,000 12,000 15,000 18,000 21,000 24,000 27,000 30,000Cummulative Annual Capacity (000 Metric Tonnes)

Man

ufac

turi

ng C

osts

($/M

etri

c T

onne

)

Cash + Delivery to Buenos Aires

Based on Poyry’s 2007 CostTrac model at 1st Quarter, 2008, Prices and Exchange Rates.

Luiz Antonio

Mogi Guaçu

Global Uncoated Freesheet Cost Curve50 lb. Rolls

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Ust-Ilimsk

Bratsk

KotlasKPK

♦ 50% of Ilim for ~$620MM

♦ Enterprise value ~ $1.6B

♦ EBITDA multiple < 4.0

♦ Strong market presence in Russia and China

Ilim Joint VentureLow-Cost, Well-Positioned

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Global Cost CurveBleached Softwood Kraft Market Pulp

0

200

400

600

800

1000

0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 20,000 22,000Cummulative Annual Capacity (000 Metric Tonnes)

Man

ufac

turi

ng C

osts

($/M

etri

c To

nne) Cash + Delivery to Shanghai

Based on Poyry’s 2007 CostTrac model at 3rd Quarter, 2007, Prices and Exchange Rates.

Ust-Ilimsk

Bratsk

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Ilim Joint Venture

Strong end-use markets in Russia & ChinaSolid economic growthHigh demand growth

Low-Cost Manufacturing

Business performing ahead of planProducing at full capacity20%+ EBITDA margins

Ilim board of directors has approved $350 million 2008 capital plan

Ilim EBITDA margin is on a 100% basis before IP adjustments and IP NA margins excludes Forest Products and xpedx

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International Operations SummaryIngredients for Success

High Demand GrowthLow-Cost ManufacturingMarket-Leading PositionsAttractive Margins and Increasing Earnings

Ex-North America EBITDA Growth

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Management PrioritiesExecution

Continue to strengthen core businesses’earnings and cash flows

Integrate Weyerhaeuser CBPR assets to drive increased earnings and cash flow

Execute global operations plans

Strengthen balance sheet via debt reduction

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