El Paso Corporation Closes Sale of Two Power Plants for $123 Million

HOUSTON, Dec 16, 2004 /PRNewswire-FirstCall

El Paso Merchant Energy, a business unit of El Paso Corporation (NYSE: EP), today announced that it has closed the sale of two domestic power generation facilities to Northern Star Generation, LLC for approximately $123 million.

With the sale of these facilities, El Paso has now closed 24 of the 25 domestic power plants it announced in January it had agreed to sell to Northern Star Generation, LLC. Proceeds from these sales total approximately $739 million, plus the elimination of approximately $171 million in consolidated non-recourse debt.

These sales support El Paso's long-range plan to reduce the company's debt, net of cash, to approximately $15 billion by year-end 2005. El Paso had targeted asset sales within the range of $3.3 billion to $3.9 billion by the end of 2005, and to date the company has announced or closed approximately $3.6 billion of asset sales.

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

Northern Star Generation, LLC is owned by AIG Highstar Generation LLC and OTPPB US Power, LLC, which is owned by Ontario Teachers' Pension Plan Board. AIG Highstar Generation LLC is owned by AIG Highstar Capital II, L.P. and affiliates. AIG Highstar Capital II, L.P. is sponsored by AIG Global Investment Group.

Cautionary Statement Regarding Forward-Looking Statements

This release includes forward-looking statements and projections, made in reliance on the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The company has made every reasonable effort to ensure that the information and assumptions on which these statements and projections are based are current, reasonable, and complete. 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, the ability to implement and achieve our objectives in the long-range plan; our ability to close our announced asset sales on a timely basis; the uncertainties associated with governmental regulation; and other factors described in the company's (and its affiliates') Securities and Exchange Commission filings. While the company makes these statements and projections in good faith, neither the company nor its management can guarantee that anticipated future results will be achieved. Reference must be made to those filings for additional important factors that may affect actual results. The company assumes no obligation to publicly update or revise any forward-looking statements made herein or any other forward-looking statements made by the company, whether as a result of new information, future events, or otherwise.

SOURCE El Paso Corporation

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