press release

Production begins at Mad Dog in deepwater Gulf of Mexico

Sugar Land, Texas, Jan. 18, 2005 - Unocal Corporation (NYSE: UCL) today announced start-up of oil and natural gas production from the Mad Dog development, located in the deepwater Gulf of Mexico, approximately 200 miles south of New Orleans, La.

Located in approximately 4,500 feet of water in Green Canyon Block 782, Mad Dog production began on Jan. 13 and is expected to increase over the next year as additional wells are completed and brought online. The facility is designed to process approximately 100,000 barrels of oil and 60 million standard cubic feet of gas per day.

"The start of production from the Mad Dog field represents a milestone as Unocal's first production from its deepwater Gulf of Mexico program," said Joe Bryant, Unocal president and chief operating officer. "Mad Dog also is the first of five projects worldwide expected to add significant production volumes by the fourth quarter of 2005."

Bryant said that another Gulf of Mexico discovery, K2, is on track to start production in the second quarter 2005. When combined with Mad Dog, the two fields should add an estimated 10,000 to 12,000 barrels of oil equivalent per day (net) by year-end 2005. The Mad Dog development consists of a truss spar, equipped with facilities for simultaneous production and drilling operations. Oil from Mad Dog will be transported via the Caesar pipeline to Ship Shoal 332B, where it will interconnect with the Cameron Highway Oil Pipeline System (CHOPS). Mad Dog gas will be exported via the Cleopatra pipeline to Ship Shoal 332A, where it will interconnect with Manta Ray Gathering System, and from there to the Nautilus Gas Transportation System into Louisiana. Both Caesar and Cleopatra pipelines are part of the BP-operated Mardi Gras Transportation System.

Mad Dog was discovered in 1998, using the Discoverer 534. The spar components and topsides were fabricated in Finland and Louisiana.

Unocal owns a 15.6% working interest, with net interest after royalty of 13.3%; BP is the operator, with a 60.5% working interest, and BHP Billiton owns a 23.9% working interest.

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 oil and gas activities are in Asia and North America.

This news release contains forward-looking statements about matters such as drilling, development and other plans for future operations; and production rates, timing and growth. Although these statements are based upon Unocal's current expectations and beliefs, they are subject to known and unknown risks and uncertainties that could cause actual results and outcomes to differ materially from those described in, or implied by, the forward-looking statements, including volatility in commodity prices; Unocal's ability to develop and produce deepwater and other projects in a timely and cost-effective manner; the accuracy of Unocal's estimates and judgments regarding hydrocarbon resources and formations and reservoir performance; operational risks inherent in the exploration, development and production of oil and gas; the impact of environmental laws, permitting and licensing requirements and other regulations; international and domestic political and economic factors; performance by third party operators of properties in which Unocal has an interest; and other factors discussed in Unocal's 2003 Annual Report on Form 10-K, as amended, and subsequent reports filed by Unocal with the U.S. Securities and Exchange Commission (SEC).

Copies of Unocal's SEC filings are available from Unocal by calling 800-252-2233 or from the SEC by calling 800-SEC-0330. The reports are also available on the Unocal web site, Unocal undertakes no obligation to update the forward-looking statements in this news release to reflect future events or circumstances. All such statements are expressly qualified by this cautionary statement, which is provided pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.

Updated: January 2005