Valero Energy Corporation Announces Purchase of Logistics Assets From Link Energy LLC.

Energy Editors/Business Editors

SAN ANTONIO--(BUSINESS WIRE)--Dec. 31, 2003

Valero Energy Corporation (NYSE:VLO) announced today it has completed the purchase of Link Energy LLC's (formerly EOTT Energy LLC) natural gas liquid (NGL) storage facilities located in Mont Belvieu and its idled MTBE plant assets located near the Houston Ship Channel at Morgan's Point for $20 million in cash. The Mont Belvieu assets include ten NGL storage caverns with rated capacity of approximately 10 million barrels, a 120-mile pipeline grid system connecting the Mont Belvieu storage caverns to Morgan's Point and to customers along the Houston Ship Channel.

The storage and pipeline assets are utilized to move NGL products for customers on a fee basis between Mont Belvieu, Morgan's Point and Texas City. The company plans to expand its NGL marketing and trading activities in the region and as a result will significantly increase the utilization of the storage and pipeline assets. The 17,500 barrel-per-day MTBE facility has been idled since October 2003 and will not be utilized to produce MTBE in the future. However, the company is evaluating several options to use the facility to produce high-value light products in the future such as iso-octene and alkylate.

Valero Energy Corporation is a Fortune 500 company based in San Antonio, with approximately 20,000 employees and annual revenues of more than $30 billion. The company currently owns and operates 14 refineries in 13 locations throughout the United States and Canada. Valero's refineries have a combined throughput capacity of over two million barrels per day, which represents approximately 10 percent of the total U.S. refining capacity. Valero is also one of the nation's largest retail operators with approximately 4,000 retail outlets in the United States and Canada under various brand names including Diamond Shamrock, Ultramar, Valero, Beacon and Total. For more information about Valero, visit the company's web site at www.valero.com.

Statements contained in this press release that state the company's or management's expectations or predictions of the future are forward-looking statements intended to be covered by the safe harbor provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934. The words "believe," "expect," "should," "estimates," and other similar expressions identify forward-looking statements. It is important to note that the company's actual results could differ materially from those projected in its forward-looking statements. For more information concerning factors that could cause actual results to differ from those expressed or forecast, see the company's annual report on Form 10-K and quarterly reports on Form 10-Q, filed with the Securities and Exchange Commission and available on the company's web site at http://www.valero.com. These factors include potential changes in gasoline, crude oil, distillate and other commodity prices, varying market conditions, actions of government, hostilities in oil producing regions, adverse rulings in litigation and potential delays or other changes in work and repair schedules. The company undertakes no obligation to update or publicly release the result of any revisions to any forward-looking statements that may be made to reflect events or circumstances that occur, or which the company becomes aware of after the date of this release or to reflect the occurrence of unanticipated events.