HOUSTON, TEXAS, January 26, 2001—The Board of Directors of El Paso Energy Corporation (NYSE:EPG) announced that it approved a 3-percent increase in the quarterly dividend to $0.2125 per share on the company's outstanding common stock.  The dividend will be payable April 2, 2001 to shareholders of record as of the close of business on March 2, 2001.  Outstanding shares of common stock entitled to receive dividends as of December 31, 2000 were 240,625,744.

"We are pleased to announce another increase in the company's dividend," said William A. Wise, chairman, president, and chief executive officer of El Paso Energy.  "Since going public in 1992, the company has provided shareholders with 6-percent compounded annual growth in its dividend.  The future for El Paso Energy has never been better.  The demonstrated success of our Merchant Energy platform offers exceptional opportunities both in the United States and in international markets where El Paso is building a significant presence.  Our merger with The Coastal Corporation enhances these opportunities, and we remain on track to deliver sustained earnings and cash flow growth well into the future."

With over $27 billion in assets, El Paso Energy Corporation is one of the largest integrated natural gas-to-power companies in the world.  El Paso Energy not only owns North America's largest natural gas pipeline system, but also has growing operations in merchant energy services, power generation, international project development, gas gathering and processing, and gas and oil production.  On May 5, the stockholders of both El Paso Energy and The Coastal Corporation overwhelmingly voted in favor of merging the two organizations.  The merger is expected to close shortly, concurrent with the final approval of the transaction by the Federal Trade Commission.  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.