El Paso Finalizes Agreement

El Paso Global LNG, a subsidiary of El Paso Corporation, announced today that the definitive liquefied natural gas (LNG) purchase and sale agreement signed in October 2001 with a consortium of natural gas production companies led by Statoil ASA received final Norwegian and United States government approvals on May 31, 2002. The consortium will develop the Snohvit Project in northern Norway and provide El Paso with an annual delivery of approximately 1.8 million tons of LNG during the 17-year primary term of the agreement. This agreement will account for more than 40 percent of the total capacity to be produced at the Snohvit Project's LNG liquefaction facility, which will be located on Melkoya Island, just north of Hammerfest, Norway. The consortium will be responsible for developing the proven reserves that support this project, including constructing the pipeline infrastructure and liquefaction facilities, and making all necessary LNG shipping arrangements. El Paso will receive LNG shipments equivalent to an estimated 91 billion cubic feet per year of natural gas beginning in 2006. The shipments will be delivered to the existing Cove Point, Maryland LNG regasification terminal, or to other North America and European destinations where the LNG will be regasified and sold as natural gas. El Paso has the capacity at Cove Point to deliver about 250 million cubic feet per day of natural gas into the East Coast pipeline infrastructure. "We are extremely pleased with the efforts of the consortium in obtaining the approvals which now bring this contract to fruition," said Greg G. Jenkins, president of El Paso Global Petroleum and LNG Group. "This approval advances El Paso's LNG business in important ways. The contract provides both security of supply and destination flexibility, which we believe are important elements of the evolving LNG marketplace. We are confident in our ability to fill the entire capacity at the Cove Point terminal, and are well prepared to market additional supply if the consortium decides to expand the liquefaction facility." El Paso recently announced the development of EP Energy Bridge(TM), a new ship-based LNG regasification system. The new delivery system uses proven offshore buoy technology to moor the ship and proprietary technology to regasify LNG onboard the ship and discharge it through a subsea pipeline. EP Energy Bridge(TM) enables flexible, environmentally safe, and cost-effective delivery of natural gas directly to coastal regions and provides supplemental supplies to growing North American markets. El Paso Global LNG is responsible for the advancement of LNG opportunities, including the development of LNG regasification delivery systems, shipping assets, and LNG supply resources worldwide. El Paso Corporation is North America's leading provider of natural gas services. The company has core businesses in natural gas production, gathering and processing, and transmission, as well as liquefied natural gas transport and receiving, petroleum logistics, power generation, and merchant energy services. El Paso Corporation, rich in assets and fully integrated across the natural gas value chain, is committed to developing new supplies and technologies to deliver energy to communities around the world.