Calpine Completes Acquisition of Unocal Geothermal Assets; Company Names Tom Mason Senior Vice President To Head Up Geysers Operations.

SAN JOSE, Calif.--(BUSINESS WIRE)--March 23, 1999--San Jose, Calif.-based Calpine Corporation (NYSE:CPN), a leading independent power company, today announced that it has completed the acquisition of Unocal Corporation's Geysers geothermal steam fields in northern California for $101 million.

The Geysers is the world's largest producing geothermal resource.

These steam fields fuel Pacific Gas & Electric Company's (PG&E) 12 Sonoma County power plants, totaling 544 megawatts of capacity. Calpine has acquired the remaining 75 percent interest in the steam fields from Unocal to become the 100 percent owner/operator.

"To make the most out of this valuable natural resource, all operating components must be integrated into one efficient, streamlined organization," said Ron Walter, senior vice president of Calpine. "This has been our strategy, and this acquisition allows us to achieve that integration, which will help lower costs of production and extend the life of The Geysers."

Calpine is planning to further consolidate The Geysers operations. As recently announced, Calpine is in the final stages of acquiring PG&E's 14 Geysers geothermal power plants in Sonoma and Lake Counties. With the PG&E acquisition in place, Calpine will become the largest producer of geothermal energy in the United States.

Tom Mason will join Calpine as a senior vice president. One of his initial assignments will be the overall management of Calpine's Geysers activities. Mason, former president of CalEnergy Operating Company, Inc., was responsible for all of CalEnergy's generation assets, which are located in the United States, the Philippines and Indonesia.

Calpine has been actively involved in the geothermal industry for 15 years. The company's geothermal staff has more than 20 years of power plant and resource experience at The Geysers. With the Unocal acquisition and the pending PG&E acquisition, Calpine will own 800 megawatts of geothermal steam field and power plant assets at The Geysers.

Calpine Corporation is a leading independent power company dedicated to providing customers low-cost electricity and thermal energy throughout the U.S. Calpine currently has 6,700 megawatts of capacity in operation, under construction or in announced development. The company was founded in San Jose, Calif. in 1984 and is publicly traded on the New York Stock Exchange under the symbol CPN. For more information, please visit Calpine's website at www.calpine.com.

The matters discussed in this news release may be considered "forward looking" statements within the meaning of Section 27A of the Securities and Exchange Act of 1993, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements include declarations regarding the intent, belief or current expectations of the Company and its management. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve a number of risks and uncertainties; actual results could differ materially from those indicated by such forward-looking statements. Among the important factors that could cause results to differ materially from those indicated by such forward-looking statements are: (i) that the information is of a preliminary nature and may be subject to further adjustments, (ii) risks associated with power plant and steam field operations, (iii) changes in government regulation, (iv) general operating risks, (v) the dependence on third parties, (vi) the dependence on senior management and (vii) other risks identified from time to time in the Company's reports and registration statements filed with the Securities and Exchange Commission.