VLI Valero Lp

Valero GP Holdings, LLC (NYSE: VEH), the owner of the general partner of Valero L.P. (NYSE: VLI), announced today that it will commence a secondary public offering of 17,869,565 of its units representing limited liability company interests pursuant to a registration statement on Form S-1 previously filed with the Securities and Exchange Commission. The underwriters will be granted a 30-day option to purchase up to 2,680,435 additional units. If the underwriters exercise such option in full, the ownership interest of subsidiaries of Valero Energy Corporation in Valero GP Holdings, LLC will be reduced to zero. All of the units being sold are offered by subsidiaries of Valero Energy Corporation (NYSE: VLO). As a result, Valero GP Holdings, LLC will not receive any proceeds from this offering. Lehman Brothers Inc., UBS Investment Bank, Citigroup Global Markets, Inc. and Morgan Stanley & Co. Incorporated will act as joint book-running managers. Acting as co-managers for the offering are Goldman Sachs & Co., RBC Capital Markets Corporation, Wachovia Capital Markets, LLC, A.G. Edwards & Sons, Inc., Raymond James & Associates, Inc., Credit Suisse Securities (USA) LLC, J.P. Morgan Securities Inc., Oppenheimer & Co. Inc., and Sanders Morris Harris Inc. A copy of the prospectus relating to this offering may be obtained from any of the underwriters, including Lehman Brothers Inc., c/o ADP Financial Services, Integrated Distribution Services, 1155 Long Island Avenue, Edgewood, NY 11717, fax: 631-254-7268, email: monica_castillo@adp.com or from UBS Investment Bank at 299 Park Avenue, Prospectus Department, New York, NY, 10171, phone: 212-821-3000. A registration statement relating to these securities has been filed with the Securities and Exchange Commission but has not yet become effective. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This news release shall not constitute an offer to sell or a solicitation of an offer to buy the securities described herein, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction. The offering may be made only by means of a prospectus. Valero GP Holdings, LLC is a publicly traded limited liability company that owns the 2 percent general partner interest, a 21.4 percent limited partner interest and the incentive distribution rights in Valero L.P., one of the largest independent terminal and petroleum liquids pipeline operators in the nation with operations in the United States, the Netherlands Antilles, Canada, Mexico, the Netherlands and the United Kingdom. For more information, visit Valero GP Holdings, LLC�s web site at www.valerogpholdings.com. Valero L.P. is a publicly traded, limited partnership based in San Antonio, with 9,303 miles of pipeline, 86 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 million barrels of storage capacity, and includes crude oil and refined product pipelines, refined product terminals, a petroleum and 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.