VLI Valero Lp

Valero Logistics Operations, L.P., a 100 percent-owned operating subsidiary of Valero L.P. (NYSE:VLI), announced today that it has extended until 5:00 p.m. New York City time, on May 10, 2006 the Expiration Date of the consent solicitation relating to (i) its $100.0 million aggregate principal amount of outstanding 6 7/8% Senior Notes due 2012 and (ii) its $250.0 million aggregate principal amount of outstanding 6.05% Senior Notes due 2013. Valero Logistics Operations also amended the definition of "Change of Control Triggering Event" as set forth in the Consent Solicitation Statement dated April 19, 2006. As amended, consent is being sought in order to amend the change of control covenant and related definitions set forth in the indenture governing the notes of both such series. The proposed amendment would provide that Valero Logistics Operations must make an offer to repurchase the notes only upon the occurrence of both (a) a change of control and (b) the failure of the notes to have an investment grade rating during the period that begins on the first date of public announcement of such change of control and ends on the 180th day after the date of such announcement; provided, however, that if on such 180th day, the ratings of the notes are on review for possible downgrade by at least two rating agencies, then such period shall be extended for so long as such review continues by either of such rating agencies. The revocation date will not be extended past the original expiration date of 5:00 p.m., New York City time, on May 3, 2006. Holders of record as of April 18, 2006 who consent to the proposed amendment will receive $5.00 per $1,000 principal amount with respect to 6.05% Senior Notes due 2013 and $2.50 per $1,000 principal amount with respect to the 6 7/8% Senior Notes due 2012. The consent solicitation will expire on May 10, 2006, unless further extended. Holders of the notes are referred to Valero Logistics Operations' Consent Solicitation Statement dated April 19, 2006, as amended on May 3, 2006, and the related Letter of Consent for the detailed terms and conditions of the consent solicitation. This announcement amends and supplements Valero Logistics Operations' Consent Solicitation Statement and the related Letter of Consent with respect to the matters described above. All other terms and conditions of Valero Logistics Operations' Consent Solicitation Statement and the related Letter of Consent remain in full force and effect. Valero Logistics Operations has retained Lehman Brothers Inc. to serve as its solicitation agent, Georgeson Shareholder to serve as the information agent and Computershare Trust Company of New York to serve as tabulation and paying agent for the consent solicitation. Questions concerning the terms of the consent solicitation should be directed to Lehman Brothers Inc., Collect: 212-528-7581, Toll Free: 800-438-3242, Attention: Liability Management Group. Requests for documents may be directed to the information agent. Banks and brokers may call the information agent at 212-440-9800, and all others may call 866-316-1190. This announcement is not an offer to purchase or sell, a solicitation of an offer to purchase or sell or a solicitation of consents with respect to any securities. The solicitation is being made solely pursuant to the above-described Consent Solicitation Statement dated April 19, 2006, as amended by the Amendment to Consent Solicitation Statement dated May 3, 2006, and the related Letter of Consent. About Valero Logistics Operations, L.P. and Valero L.P. Valero Logistics Operations, L.P. is a 100 percent-owned operating subsidiary of Valero L.P., a master limited partnership that is owned approximately 23 percent by subsidiaries of Valero Energy Corporation (NYSE:VLO). Valero L.P. is a master limited partnership based in San Antonio, with 9,186 miles of pipeline, 89 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 77.7 million barrels of storage capacity, and includes crude oil and refined product pipelines, refined product terminals, petroleum and a specialty liquids storage and terminaling business, as well as crude oil storage tank facilities. For more information, visit Valero L.P.'s web site at www.valerolp.com. 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 Logistics Operations. 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.