HOUSTON, TEXAS, October 5, 2004—El Paso Corporation (NYSE:EP) announced today that it has closed two transactions resulting in total proceeds of $198 million. First, El Paso closed the sale of four power plants to Northern Star Generation, LLC for $147 million. El Paso has now closed on the sale of 21 of the 25 domestic power plants that the company previously announced in January it had agreed to sell to Northern Star Generation, LLC. With the close of this transaction, El Paso has received approximately $569 million and eliminated approximately $39 million of non-recourse debt from this group of power plants.

This sale is part of El Paso's plan to sell its domestic power portfolio as part of its long-range plan to reduce the company's debt, net of cash, to approximately $15 billion by year-end 2005. To date the company has announced or closed approximately $3.5 billion of the $3.3 to $3.9 billion of asset sales targeted under the plan. An asset sales tracker that shows all of the announced and completed asset sales is posted at www.elpaso.com under Investor Resources.

Also, El Paso's merchant energy subsidiary has received a final installment of approximately $51 million on the sale of contracts related to the company's Elba Island Liquefied Natural Gas (LNG) terminal. In December 2003, El Paso Merchant Energy announced that it had assigned the contractual rights to all of its upstream and downstream gas purchase and natural gas sales contracts at the Elba Island LNG terminal to BG LNG Services, LLC and BG Gas Marketing LTD. As part of the overall transaction, El Paso previously released its long-term capacity rights at the Elba facility to BG LNG Services last year. These capacity rights consist of 4 billion cubic feet of storage and firm vaporization capacity of 446 million cubic feet per day. The receipt of this second installment was triggered as the result of a downstream sales contract becoming effective. The sale of these contracts has no impact upon El Paso's ownership of the Elba Island terminal, which is still owned 100 percent by a subsidiary of El Paso.

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 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.

Editor's Note:
The table below lists the power plants included in today's announcement.

This report 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 report, including, without limitation, the ability to implement and achieve our objectives in the long-range plan, including achieving our debt-reduction targets; the potential impact of the restatement of financial results on our access to capital (including borrowings under credit arrangements); changes in reserve estimates based upon internal and third party reserve analyses; uncertainties and potential consequences associated with the outcome of governmental investigations, including, without limitation, those related to the reserve revisions and natural gas hedge transactions; outcome of litigation, including shareholder derivative and class actions related to reserve revisions and restatements; consequences arising from the delay in filing of our periodic reports including the exercise of remedies by the company's lenders under certain financing arrangements and if such remedies were to be exercised, the company's potential inability to identify and obtain alternate sources of financing and the existence of cross-acceleration provisions in various financing agreements; uncertainties associated with exploration and production activities; actions by the credit rating agencies; the successful close of our financing transactions; our ability to successfully exit the energy trading business; our ability to close our announced asset sales on a timely basis; changes in commodity prices for oil, natural gas, and power; inability to realize anticipated synergies and cost savings associated with restructurings and divestitures on a timely basis; general economic and weather conditions in geographic regions or markets served by El Paso Corporation and its affiliates, or where operations of the company and its affiliates are located; the uncertainties associated with governmental regulation; political and currency risks associated with international operations of the company and its affiliates; difficulty in integration of the operations of previously acquired companies, competition, 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.