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Bill Klesse and Greg King Step Down From Valero L.P. Board of Directors

Posted on: Tuesday, 5 September 2006, 18:00 CDT

Valero L.P. (NYSE:VLI) today announced that Bill Klesse, Chief Executive Officer of Valero Energy Corporation (NYSE:VLO), and Greg King, President of Valero Energy Corporation, have resigned from the Board of Directors of Valero L.P. as part of a plan to further separate the two organizations. Klesse and King will continue in their roles at Valero Energy Corporation, and Bill Greehey, former Chief Executive Officer of Valero Energy Corporation, will remain as Chairman of Valero L.P., Valero GP Holdings, LLC (NYSE:VEH) and Valero Energy Corporation.

"Bill and Greg have been integral to the growth and success of Valero L.P. since Valero Energy acquired it at the end of 2001," said Greehey. "However, it is necessary to continue the process of separating Valero Energy and Valero L.P. to allow both companies to pursue their own strategic initiatives. We expect that the complete separation of Valero L.P. from Valero Energy will better position the partnership for future growth."

On July 19, 2006, Valero GP Holdings, LLC completed its initial public offering of approximately 41 percent of its outstanding units. Valero Energy Corporation currently holds the remaining 59 percent interest in Valero GP Holdings, LLC. Valero GP Holdings, LLC owns the 2 percent general partner interest, 100 percent of the incentive distribution rights and approximately 10.2 million common units, or 21.4 percent limited partner interest in Valero L.P. Valero Energy Corporation has announced its intention to eventually sell all of its interest in Valero GP Holdings, LLC, pending market conditions and subject to a 180-day lockup agreement from the initial public offering.

Valero L.P. is a publicly traded, limited partnership based in San Antonio, with 9,243 miles of pipeline, 88 terminal facilities and four crude oil storage facilities. One of the largest independent terminal and petroleum liquids pipeline operators in the nation, the partnership has operations in the United States, the Netherlands Antilles, Canada, Mexico, the Netherlands and the United Kingdom. The partnership's combined system has approximately 77 million barrels of storage capacity, and includes crude oil and refined product pipelines, refined product terminals, a petroleum and specialty liquids storage and terminaling business, as well as crude oil storage tank facilities. For more information, visit Valero L.P.'s website at www.valerolp.com.

Cautionary Statement Regarding Forward-Looking Statements

This press release includes forward-looking statements within the meaning of the Securities Litigation Reform Act of 1995 regarding future events and the future financial performance of Valero L.P. All forward-looking statements are based on the partnership's beliefs as well as assumptions made by and information currently available to the partnership. These statements reflect the partnership's current views with respect to future events and are subject to various risks, uncertainties and assumptions. These risks, uncertainties and assumptions are discussed in Valero L.P.'s 2005 annual report on Form 10-K and subsequent filings with the Securities and Exchange Commission.

Source: Business Wire

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