HOUSTON, TEXAS, February 3, 2000—El Paso Natural Gas Company, a business unit of El Paso Energy Corporation (NYSE:EPG), announced today that it has entered into an agreement with Plains All American Pipeline, L.P. and All American Pipeline, L.P. for the purchase of a portion of the All American Pipeline for $129 million. The purchase is subject to approval from the Federal Trade Commission.

The 1,223-mile, 30-inch pipeline was built in the mid-1980s as a crude oil transportation system and runs from McCamey, Texas to Santa Barbara, California. El Paso will purchase the portion of the pipeline from McCamey, Texas to Emidio Station near Bakersfield, California—a total of 1,088 miles. The purchase also includes any fiber optic rights that All American possesses for the entire 1,233 miles of pipe.

El Paso Natural Gas Company plans to invest $75 million to convert a segment of the pipeline, which runs from McCamey, Texas to the California border, from an oil pipeline to a natural gas pipeline upon Federal Energy Regulatory Commission approval. The conversion will allow El Paso Natural Gas to replace existing natural gas compression facilities with more efficient pipeline looping, reducing operating, maintenance, and fuel costs for its customers. On the east end of El Paso's system, the pipeline will allow greater inlet capability in response to the increasing flows on the southern system. The converted pipeline is planned to go into service during the first quarter 2001.

"The purchase of these facilities presents El Paso Natural Gas with a unique opportunity to add additional flexibility on its pipeline system that is both operating expense and fuel efficient," said Patricia A. Shelton, president of El Paso Natural Gas Company. "This purchase helps ready El Paso Natural Gas for the coming decade with efficiency gains to accommodate the clockwise shift in the flow of gas in North America. We believe the acquisition of this portion of the All American Pipeline adds to the value of El Paso's position in the premier natural gas markets of the Southwest and California."

With over $16 billion in assets, El Paso Energy Corporation provides comprehensive energy solutions through its strategic business units: Tennessee Gas Pipeline Company, El Paso Natural Gas Company, Southern Natural Gas Company, El Paso Merchant Energy Company, El Paso Energy International Company, El Paso Field Services Company, and El Paso Production Company. The company owns North America's largest natural gas pipeline system, both in terms of throughput and miles of pipeline, and has operations in natural gas transmission, merchant energy services, power generation, international project development, gas gathering and processing, and gas and oil production. On January 18, 2000, El Paso Energy announced that it has agreed to merge with The Coastal Corporation in a deal valued at $16 billion, including approximately $6 billion of assumed debt and preferred equity. Visit El Paso Energy's web site at www.epenergy.com.

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. While the company makes these statements and projections in good faith, neither the company nor its management can guarantee that the anticipated future results will be achieved. Reference should be made to the company's (and its affiliates') Securities and Exchange Commission filings for additional important factors that may affect actual results.