COLOMBIA, Aug. 24, 2001 — Ecopetrol, the national oil company of Colombia, PDVSA Gas, an affiliate of Venezuela’s national oil company and Texaco today announced the signing of a non-binding memorandum of understanding (MOU) to conduct a feasibility study to evaluate the construction of a natural gas pipeline to interconnect Colombia and Venezuela.

The proposed pipeline would be approximately 200 kilometers in length and would connect Texaco’s and Ecopetrol’s offshore infrastructure in the Guajira region in northeast Colombia to markets in Lake Maracaibo, Venezuela. Texaco and Ecopetrol supply approximately 80 percent of Colombia’s natural gas needs. PDVSA Gas is the major supplier of natural gas throughout Venezuela.

The three parties will form a project team to conduct the study over a six-month period to determine the scope of the export project and pipeline construction budget. The study will examine and evaluate the environmental, technical and commercial factors of the export project. If deemed commercial, the parties will determine their participation in a joint development agreement for the pipeline construction and/or a supply agreement for the sale of Colombian gas to Venezuela.

Ecopetrol President Alberto Calderon, said, “We are interested in exploring conditions that would make a gas interconnection between Colombia and Venezuela economically feasible. If we find possibilities, we’ll analyze the supply options that satisfy the aspirations of both countries.”

PDVSA Gas President Nelso Nava said, “We are looking at this study with a futuristic approach. Our idea is to use the pipeline to import gas during the early years of the project, to offset some circumstantial shortage that we are experiencing in the Western side of the country. But after this period we may very well be in the position of reversing the direction of the pipeline flow and use it as a first leg of a pipeline system able to export gas from Venezuela to other countries both in Central and South America.”

“As the demand for clean energy supplies continues to increase throughout the Andean Region, we look forward to creating new solutions which link resources and markets,” said Alex H. Archila, President of Texaco Colombia. Note to Editors:

Texaco began operations in Colombia in 1946 marketing fuels. Since then, these operations have grown to include exploration, production, marketing and manufacturing.

Currently, The Texas Petroleum Company, Texaco’s subsidiary operating in Colombia, is the largest producer of natural gas in the country, supplying more than 75 percent of the natural gas consumed in Colombia.

From a fuels and lubricants point of view, currently there are some 300 Texaco-branded retail outlets located throughout Colombia. In addition, Colombia serves as the headquarters of Texaco’s Andean marketing and manufacturing region.