press release

Unocal Alaska business unit restructures to improve profitability

Anchorage, Alaska, November 12, 2002 - Unocal Alaska is implementing a comprehensive restructuring program to improve Cook Inlet business profitability through reducing capital investments, elimination of duplicate services, shutting in certain facilities, and streamlining operational, technical and support functions.

Baker and Dillon platforms will be shut in over the next few months. The Unocal Kenai office will be closed. Some Kenai office jobs will be eliminated, while the worksite for some Kenai office jobs will be moved to the Anchorage office and other locations on the Kenai Peninsula. As a result of the restructuring, a workforce reduction of 71 positions has occurred at field locations and at the Anchorage and Kenai offices. Of the 71 positions, 47 employees have been laid off, 12 employees have been transferred and 12 contract positions have been eliminated. This number is approximately 18 percent of Unocal Alaska's total work force.

The restructuring came as a result of a thorough analysis of Unocal's Alaska Business Unit with the object to improve profitability and viability in a mature business. "As we studied the costs, operations and exploration opportunities, it became clear that to have a viable business in the Cook Inlet we had to make significant changes now, or face even more serious challenges in the future," said Unocal Alaska Vice President Chuck Pierce.

Unocal will continue to pursue selective, focused development and exploration projects to add incremental reserves and production. Unocal will retain its partner-operated working interests in the Kuparuk and Endicott fields. Unocal also holds North Slope undeveloped acreage and will continue its exploration activities.

Updated: November 2002