October 15, 2008

Sempra and Valero Energy to Develop Marine Terminal Project in Texas

Sempra Energy has signed a memorandum of understanding that could lead to the development of its Port Arthur, Texas, marine petroleum terminal and storage facility with Valero Energy, the leading oil refiner in North America.

Under the terms of the memorandum of understanding, Sempra Energy would develop detailed design, engineering and construction plans for the site. Valero Energy would become a key petroleum shipper at the terminal, conduct joint marketing efforts to other potential third-party users and contribute rights of way for the construction of connecting pipelines.

Subject to the completion of project designs and the acquisition of sufficient commercial agreements for the use of the terminal, the companies anticipate an agreement to develop the project would be completed by early 2009. The facility could become operational in 2011.

The new terminal is expected to create 300 to 400 construction jobs and about 20 permanent positions, adding important economic growth to the Port Arthur region. The Port Arthur marine petroleum terminal is strategically located at the intersection of the Gulf Intracoastal Waterway and the Sabine-Neches Waterway.

The proposed Port Arthur Marine Terminal would provide storage and transportation assistance in the supply of crude oil and other petroleum feedstocks to Valero and all other regional refiners as well as support for refined products. The project's storage tanks and multi-ship berthing facilities would require approximately 120 of the 2,900 acres Sempra Energy owns in Jefferson County, Texas.