Unocal Announces Completion of Lagosta Well Offshore Brazil

Unocal Corporation announced completion of the Lagosta exploration well located on Block BES-2 offshore Brazil in the Espirito Santo Basin.

Well data collection and evaluation has been completed, and the well has been plugged and abandoned in accordance with Brazilian regulations.

"We are pleased that the well had hydrocarbon shows and that the ANP, Brazil's national petroleum agency, has extended the exploration term for this block for two years," said Dioclecio Araujo, president of Unocal do Brazil. "We will be meeting with the co-venturers to discuss plans for the block in 2002."

Unocal said that further analysis will be required to determine whether or not the prospect can be commercial. The company expects to take a US$18 million pretax charge to earnings in the third quarter 2001 for Unocal's share of costs related to drilling the well.

Unocal holds a 30-percent interest in Block BES-2. Other participants include Petrobras and Mobil Exploracao e Desenvolvimento do Brasil Ltda., each with a 35-percent interest.