SOURCE: El Paso Corporation

December 29, 2008 16:45 ET

El Paso Corporation Reports Progress on Non-Core Asset Sales

HOUSTON, TX--(Marketwire - December 29, 2008) - El Paso Corporation (NYSE: EP) reported today significant progress on non-core asset sales, completing one transaction and executing purchase and sale agreements on several others. The expected proceeds from the reported transactions total approximately $275 million.

El Paso has completed the sale of its legacy fuel oil terminal located in South Boston for approximately $20 million.

In addition, El Paso Exploration & Production Company has entered into two purchase and sale agreements to sell two non-strategic natural gas producing properties for a total of approximately $77 million. The company will sell properties located in the San Juan Basin in northwest New Mexico that were part of its 2007 acquisition of Peoples Energy, as well as properties in the Shongaloo and Spring Hill fields along the Louisiana/Arkansas border. In total, the properties to be sold contain a current estimated 40 billion cubic feet equivalent of proved reserves, with current production of approximately 15 million cubic feet of gas equivalent per day. The sales have an effective date of December 1, 2008, and are expected to close by the end of January 2009.

El Paso has also executed a purchase and sale agreement on the sale of its interest in the Porto Velho power generation facility in Brazil for $178 million. The sale of the interest in Porto Velho will complete the company's exit from the power business in Brazil. Sales proceeds are expected to be paid with up to $100 million in cash, with the balance being paid by a note from the buyer. The sale is expected to close by the end of the first quarter of 2009.

El Paso Corporation provides natural gas and related energy products in a safe, efficient, and dependable manner. The company owns North America's largest interstate natural gas pipeline system and one of North America's largest independent natural gas producers. For more information, visit www.elpaso.com.

Cautionary Statement Regarding Forward-Looking Statements

This release contains certain forward-looking statements. All forward-looking statements are based on assumptions that El Paso believes to be reasonable. However, a variety of factors could cause actual results to differ materially from the projections, anticipated results or other expectations expressed in this release, including, without limitation, our ability to meet our 2009 debt maturities; volatility in, and access to, the capital markets; our ability to close our announced asset sales on a timely basis; our ability to comply with the covenants in our various financing documents; actions by the credit rating agencies; the successful close of our financing transactions; credit and performance risk of our lenders, trading counterparties, customers, vendors and suppliers; changes in commodity prices and basis differentials for oil, natural gas, and power; our ability to obtain targeted cost savings in our businesses; general economic and weather conditions in geographic regions or markets served by the company and its affiliates, or where operations of the company and its affiliates are located, including the risk of a global recession and negative impact on natural gas demand; the uncertainties associated with governmental regulation; political and currency risks associated with international operations of the company and its affiliates; competition; and other factors described in the company's (and its affiliates') Securities and Exchange Commission filings. All of El Paso's forward-looking statements, whether written or oral, are expressly qualified by these cautionary statements and any other cautionary statements that may accompany such forward-looking statements. In addition, El Paso disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date of this release.

Contact Information

  • Contacts:

    Investor-Media Relations
    Bruce L. Connery
    Vice President
    Office: (713) 420-5855

    Media Relations
    Richard Wheatley
    Manager
    Office: (713) 420-6828