CITGO and Unocal announce completion of patent licensing agreement
El Segundo, Calif., May 1, 2001 - CITGO Petroleum Corporation and Unocal Corporation (NYSE: UCL) jointly announced today the execution of a nonexclusive licensing agreement that grants CITGO the right to make and import cleaner burning gasolines using formulations patented by Union Oil Company of California, a Unocal subsidiary.
The license agreement is effective January 1, 2001, and covers the three refineries CITGO operates in Lake Charles, Louisiana, Corpus Christi, Texas, and Lemont, Illinois, as well as all gasoline CITGO may import. The terms of the licensing agreement are confidential.
"We're very pleased to complete this licensing agreement since it is advantageous for CITGO to use Unocal's patented formulations to maximize our reformulated gasoline (RFG) production," said Adolph Lechtenberger, CITGO's senior vice president of refining. "The agreement enhances CITGO's ability to supply the motoring public with reformulated gasoline at a reasonable cost."
Unocal applied for its initial patent for reformulated gasolines in December 1990, after completing extensive research into the emission characteristics of various gasoline formulations. The company received its first patent ('393') in 1994. Between 1997 and 2000, Unocal received four additional patents for cleaner burning gasolines that were an outgrowth of the original research.
Under the Clean Air Act, RFG is now required in many parts of the United States and comprises about one-third of all gasoline sold. RFG was originally required in nine severe ozone non-attainment areas beginning in 1995. Since then, other areas have opted into the program. Today, RFG or other very low vapor pressure gasolines are sold in more than 20 states.
"We believe that our patented formulations provide CITGO with a cost-effective way of meeting California and Federal standards for cleaner burning gasolines," said Charles R. Williamson, Unocal chief executive officer.
About CITGO Petroleum Corporation
CITGO, based in Tulsa, Okla., is a refiner, transporter and marketer of transportation fuels, lubricants, petrochemicals, refined waxes, asphalt and other industrial products. It is owned by PDV America, Inc., an indirect wholly owned subsidiary of Petroleos de Venezuela, S.A., the national oil company of the Republic of Venezuela.
For more information about CITGO, visit www.citgo.com.
About Unocal Corporation
Unocal is one of the world's leading independent natural gas and crude oil exploration and production companies. The company's principal operations are located in North America (Gulf of Mexico region, Alaska and Canada) and in Asia (Thailand, Myanmar, Indonesia, and Bangladesh). The company is also pursuing exploration programs in West Africa and Brazil.
Additional information about Unocal's patents for cleaner burning gasoline formulations is available on the company's web site. and in its 2000 Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission.
Updated: May 2001