press release

Unocal announces additional common stock and preferred repurchases

El Segundo, Calif., Dec. 3, 2004 - Unocal Corporation (NYSE: UCL) today said that its board of directors has authorized a new cash expenditure program of up to $465 million to repurchase Unocal securities.

The board's authorization earmarks up to $265 million to call the remaining outstanding Unocal 6-1/4% trust convertible preferred securities. The remainder of the cash expenditure program authorization would be used to repurchase Unocal common stock.

The program announced today follows a cash expenditure program completed earlier this year where Unocal repurchased 4.13 million common shares for $150 million, redeemed 4.9 million shares of Unocal's outstanding 6-1/4% Trust Convertible Preferred Securities for approximately $250 million, and contributed $100 million to Unocal's U.S. pension plan.

"Unocal continues to enjoy high cash balances as a result of our strong operations and high commodity prices," said Charles R. Williamson, Unocal chairman and chief executive officer. "By eliminating the preferred securities and reducing the number of outstanding common shares, we can increase stockholder value, while providing sufficient cash resources to fund our planned capital programs."

Redemption of trust convertible preferred securities

The Unocal board authorized an expenditure of up to $265 million to redeem or otherwise repurchase all of the remaining 6-1/4% trust convertible preferred securities of Unocal Capital Trust. The trust currently has 5.2 million shares outstanding with an aggregate liquidation value of $261 million, plus a $4 million call premium. Unocal expects to complete this transaction by the end of the first quarter 2005.

Common stock repurchases

The Unocal board of directors authorized the repurchase of up to $200 million of the outstanding Unocal common stock. To the extent that the full $265 million authorized to redeem the outstanding preferred securities is not spent because the holders convert their securities into common stock, the board has authorized that the unspent funds be utilized for further repurchases of Unocal common stock.

The common shares are expected to be repurchased from time to time through open market transactions or privately negotiated transactions at the discretion of company management, depending on financial and market conditions and as otherwise permitted under applicable laws. There is no set time limit on the repurchases, but Unocal expects to complete the repurchase by the end of the first quarter of 2005.

About Unocal Corporation

Unocal is one of the world's leading independent natural gas and crude oil exploration 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 the consummation, amounts, timing and structure of common and preferred stock repurchase programs; the sufficiency of remaining cash to partially fund capital expenditures; and increases in stockholder value. 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 market conditions for the company's common and preferred stock; any future issuances of common or preferred stock; volatility in commodity prices; the extent of Unocal's operating cash flow and other capital resources available to fund its capital expenditures; and other factors discussed in Unocal's 2003 Annual Report on Form 10-K, as amended, and subsequent reports filed by Unocal with the Securities and Exchange Commission (SEC File No. 1-8483). 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.

Updated: December 2004