press release

Unocal signs agreement for PTTEP farm-in to Vietnam blocks

Bangkok, Aug. 8, 2000 -- Unocal Corporation (NYSE: UCL) today announced the signing of agreements that will enable Thailand's PTT Exploration and Production Public Company Limited (PTTEP) to acquire up to 10-percent working interests in two oil and gas exploration production-sharing contract (PSC) areas offshore Vietnam.

Under the agreements, PTTEP, through its subsidiaries PTTEP Kim Long Vietnam Co., Ltd., and PTTEP Southwest Vietnam Co., Ltd., will have the opportunity to farm-in to the blocks B and 48/95 PSC area and the block 52/97PSC area, both located in the northern part of the Malay Basin, respectively.

"PTTEP has significant gas business experience in the region, and we are pleased to have them join us in this venture," said Randy L. Howard, Unocal vice president for international energy operations. "PTTEP will be able to share its operational knowledge that will help to lower development costs for the two PSCs considerably."

PTTEP has been operating the Bongkot gas field in the southern part of the Gulf of Thailand and is operator of the Arthit project, located on Thailand's continental shelf adjacent to the Vietnam blocks.

Chitrapongse Kwangsukstith, president of PTTEP, added, "This transaction represents another step by PTTEP into the international exploration and production arena. Natural gas is the most efficient and environmentally friendly fuel abundant in this region of the world, so we are excited to begin working on an existing high potential gas discovery with Unocal and Mitsui Oil Exploration as partners of proven experience."

Masahiro Danjo, general manager of Bangkok-based Mitsui Oil Exploration Co., Ltd. (MOECO), added, "Having been a partner of Unocal in this region over the past two decades, we are confident in Unocal's ability to find and develop oil and gas fields at a very low cost and high efficiency. We are also highly encouraged by the participation of PTTEP, Thailand's own exploration and production company, which is getting stronger every day."

The farm-in agreements are subject to approval by PetroVietnam, Vietnam's state oil company, and the Vietnamese Ministry of Planning and Investment.

Blocks B and 48/95

Unocal Vietnam Exploration, Ltd., is operator of the blocks B and 48/95 PSC area and has a 45-percent working interest. Repsol Exploracion Vietnam S.A. holds 30 percent, and Moeco Vietnam Petroleum, Ltd., a subsidiary of MOECO, 25 percent. The addition of PTTEP Kim Long Vietnam will reduce Unocal's working interest to 37 percent, and Moeco Vietnam Petroleum's interest to 23 percent. All working interests in the PSC are subject to a 15-percent reduction should PetroVietnam opt to participate on a paying basis upon declaration of commerciality.

Unocal announced a significant discovery with its first exploration well in the Kim Long prospect in Block B in December 1997. Two drill-stem tests yielded a combined flow rate of nearly 53 million cubic feet per day (mmcfd). Unocal subsequently conducted a three-dimensional seismic survey on Block B and Block 52/97 in 1998 and recently commenced a second drilling campaign.

Block 52/97

Unocal Southwest Vietnam Exploration & Production, Ltd. currently holds a 70-percent working interest in the block 52/97 PSC area and serves as operator. Moeco Southwest Vietnam Petroleum Company, Ltd., a subsidiary of MOECO, holds the remaining 30-percent working interest. The addition of PTTEP Southwest Vietnam will reduce Unocal's working interest to 62 percent, and Moeco Southwest Vietnam's interest to 28 percent. All working interests in the contract are subject to a 30-percent reduction should PetroVietnam opt to participate on a paying basis upon declaration of commerciality.

Unocal completed Vietnam's largest three-dimensional seismic survey to date on this contract area in 1998 and expects to drill several exploration wells later this year.

About Unocal Corporation

Unocal is one of the world's leading independent natural gas and crude oil exploration and production companies. The company also focuses on pipeline and power plant projects in Asia and the Americas. At year-end 1999, Unocal had worldwide natural gas reserves of 6.6 trillion cubic feet, representing two-thirds of the company's overall hydrocarbon reserves. Unocal's net worldwide natural gas production currently averages 2 billion cubic feet per day.

Forward-looking statements regarding future business transactions, government approvals, and exploration activities in this news release are based on assumptions concerning operational, market, competitive, regulatory, environmental and other considerations. Actual results could differ materially as a result of the foregoing and other factors discussed in Unocal's 1999 Form 10-K report filed with the U.S. Securities and Exchange Commission.

Updated: August 2000