Final Results

RNS Number:0001Y
Coastal Corporation
29 January 2001


                                     Media contact: Greg Clock [phone]
                       Investor contacts: Stirling D. Pack Jr. [phone]
                                                Sandra M. Ryan [phone]

                      Coastal Reports Record 2000 Earnings

HOUSTON, January 29, 2001 -- The Coastal Corporation today reported record
annual net earnings of $654.4 million, or $2.96 per share (assuming dilution)
for 2000, up 29 percent from comparable 1999 earnings of $498.9 million, or
$2.30 per share.

Coastal also reported record net earnings for the 2000 fourth quarter of $208.3
million, or 93 cents per share, up 19 percent from comparable earnings of $169.0
million, or 78 cents per share in the fourth quarter of 1999.

Excluding one-time items and merger-related expenses, 2000 earnings were $651.2
million, or $2.95 per share, and fourth quarter 2000 earnings were $205.2
million or 92 cents per share.

Commenting on the results, David A. Arledge, chairman and chief executive
officer, The Coastal Corporation, said, "The fourth quarter of 2000 marked the
Company's 23rd consecutive quarter of record operating earnings. All segments
involved in Coastal's integrated natural gas strategy generated higher earnings
before one-time items for the year and fourth quarter of 2000. Exploration and
Production earnings increased 129 percent in 2000 and 11 percent in the fourth
quarter. Natural gas production increased by 42 percent for the year and 16
percent for the quarter. 0il and condensate production increased 39 percent for
2000 and 45 percent for the quarter. Natural Gas segment earnings before
one-time items increased 12 percent for the year and 32 percent for the quarter
with a growing contribution from non-regulated operations. Power earnings,
excluding a first quarter gain from an asset disposition, increased 42 percent
in 2000, and 74 percent for the fourth quarter. Net generating capacity
increased 43 percent for the year, reflecting completion of a new power facility
and an increase in ownership of an existing facility.

     "Refining, Marketing and Chemicals 2000 earnings before one-time items
increased 17 percent, with a 37 percent increase for the quarter, reflecting the
24 percent increase in refining capacity at Coastal's Aruba refinery and
strengthening worldwide demand for refined products," Arledge concluded.

     Coastal's earnings before interest and income taxes (EBIT) for 2000 were 
$1,376.4 million versus $1,028.1 million in 1999. Excluding merger-related
charges of $12.5 million offset by $17.5 million of one-time net benefits, 2000
EBIT was $1,371.4 million. EBIT for the 2000 fourth quarter was $388.4 million
versus $305.3 million in the 1999 quarter. Excluding merger-related charges of
$2.3 million, offset by one-time net benefits of $7.0 million, fourth quarter
2000 EBIT was $383.7 million.

                        -Exploration and Production-

     Exploration and Production EBIT in 2000 was $425.7 million, up 129 percent
from $185.9 million in 1999. Fourth quarter 2000 EBIT was $107.4 million, up 11
percent from $97.0 million in the 1999 quarter. Earnings improved due to
significantly higher production volumes and prices for natural gas and crude oil
and condensate.

     Coastal's natural gas production averaged 899.1 million cubic feet per day
(MMcf/d) during 2000, up 42 percent from 631.6 MMcf/d in 1999. Fourth quarter
natural gas production averaged 901.3 MMcf/d in 2000, up 16 percent from 777.1
MMcf/d in the 1999 quarter.

     Net crude oil and condensate production averaged 14,872 barrels per day
(bpd) in 2000, up 39 percent from 10,694 bpd in 1999. Fourth quarter 2000 crude
oil and condensate production averaged 16,347 bpd, up 45 percent from 11,299 bpd
in the 1999 quarter.

     In 2000, prices realized for natural gas averaged $3.89 per thousand cubic
feet (Mcf) ($2.81 after hedging versus $2.19 per Mcf ($2.17 after hedging) in
1999. During the 2000 fourth quarter, prices realized for natural gas averaged
$5.42 per Mcf ($3.29 after hedging) versus $2.48 per Mcf ($2.71 after hedging)
in 1999.

     Crude oil and condensate prices averaged $28.18 per barrel in 2000 ($24.01
after hedging) compared to $16.27 per barrel ($13.97 after hedging) in 1999. For
the fourth quarter of 2000, crude oil and condensate prices averaged $29.67 per
barrel ($25.07 after hedging) compared to $21.42 per barrel ($17.61 after
hedging) in the 1999 quarter.

     Domestic exploration and production activities resulted in a 323 percent
reserve replacement rate in 2000, Coastal's sixth consecutive year of replacing
more than 300 percent of production. Proved reserves were increased by 1.2
trillion cubic feet of natural gas equivalent (Tcfe), bringing total proved
reserves to 4.4 Tcfe at year-end. About 91 percent of Coastal's reserves are
natural gas.

                              Natural Gas

     Coastal's Natural Gas segment reported 2000 EBIT of $659.8 million versus
$573.8 million in 1999. Fourth quarter 2000 EBIT was $223.8 million compared to
$157.8 million for the 1999 quarter. Excluding $16 million for the favorable
resolution of litigation, regulated 2000 EBIT was $519.1 million compared with
$525.2 million in 1999. For the fourth quarter, EBIT was $170.3 million in 2000,
up 21 percent from $140.4 million in 1999. The increase was primarily due to
pipeline system expansions and improving market conditions.

     EBIT from unregulated gathering, processing and marketing activities was
$124.7 million for 2000, up 157 percent from $48.6 million. For the fourth
quarter, EBIT was $37.5 million, up 116 percent from $17.4 million in 1999.
These increases were due to an acquisition of midstream assets in December 1999
and a favorable processing environment for most of 2000.

     Throughput for Coastal's regulated pipeline subsidiaries was 2,181.1
billion cubic feet (Bcf) of natural gas in 2000 versus 2,108.8 Bcf in 1999. In
unregulated natural gas operations, net processing throughout averaged 2.0
billion cubic feet of natural gas per day (Bcf/d) during 2000, up about 230
percent from 0.6 Bcf/d in 1999.

     During 2000, Coastal made significant progress in positioning its pipeline
assets to transport natural gas from major producing areas to growing demand
markets. The 1,900-mile, 1.3 Bcf/d Alliance Pipeline began commercial operations
on December 1, 2000, and is flowing at full capacity. The Aux Sable facility
near Chicago, which processes natural gas shipped on Alliance, was also
completed. Coastal holds a 14.4 percent interest in both Alliance and Aux Sable.

     In October 2000, the Engage Energy joint venture was terminated and its
operations divided into separate entities. Coastal Merchant Energy, L.P., the
operation retained by the Company, commenced operation in October. Coastal
Merchant Energy provides a full spectrum of energy services, including natural
gas marketing and trading, electricity trading and sales, energy management
services, structured storage and transportation-related services, structured
power and management services, and energy risk management services.

                     -Refining, Marketing and Chemicals-

     Coastal's Refining, Marketing and Chemicals EBIT was $259.8 million in
2000 compared to $228.5 million in 1999. Fourth quarter 2000 EBIT was $57.9
million compared to $42.6 million in 1999. Reflected in 2000 fourth quarter EBIT
are one-time charges of $8 million in Refining and $12.2 million in Marketing
for the write-off of certain assets. A $19.6 million benefit is reflected in
Chemicals for the sale of 49 percent of a petrochemical facility. In addition to
these items, 2000 EBIT includes a $6 million charge for a legal settlement in
Refining in the 2000 first quarter.

     Excluding one-time items, Refining EBIT increased by $52.8 million for the
year and $20.6 million for the fourth quarter reflecting enhanced refining
capacity at Coastal's Aruba refinery and strengthening worldwide demand for
refined products. Marketing EBIT declined $8.5 million for 2000 and $1.3 million
for the quarter, primarily due to lower margins in retail and lubricants
operations. Marketing includes wholesale marketing and trading of refined
products, product pipelines and terminalling as well as retail gasoline sales.
Chemical EBIT declined $6.4 million for the year and $3.4 million for quarter
due to higher feedstock costs.

     Crude throughput at Coastal's refineries averaged 482,900 bpd in 2000
compared to 450,600 bpd in 1999. The increase was due primarily to the expansion
of the Aruba refinery. Aruba crude throughput averaged 254,100 bpd during the
2000 fourth quarter, up 36 percent from 187,400 in the 1999 quarter. Sales of
refined products, including products purchased from others, averaged 862,000 bpd
during 2000, up 10 percent from 785,000 bpd in 1999.

                               -Power-

     EBIT for Coastal's Power segment increased to $142.5 million in 2000,
compared to $89.0 million in 1999. Fourth quarter 2000 EBIT was $41.7 million, a
74 percent increase from $24.0 million in the 1999 quarter. The 2000 period
includes a $16.5 million first quarter gain from the disposition of Coastal's
interest in a power facility in Guatemala.


     During 2000, Coastal completed its ManChief facility, a 265-megawatt
gas-fired power generation facility located near Brush, Colorado. Coastal owns
and manages the plant, which has a power purchase agreement with Public Service
Company of Colorado. In January,2000, the Company acquired an additional 23.1
percent interest in the Midland Cogeneration Venture Limited Partnership (MCV),
increasing its ownership to 43.5 percent. MCV operates a 1,500-megawatt,
natural gas-fired cogeneration facility in Midland, Michigan.

     Coastal's net generating capacity in operation on December 31, 2000,was
2,049 megawatts, up 43 percent from 1,437 megawatts on December 31, 1999.

                                -Coal-

     EBIT for Coastal's Coal segment was $3.1 million in 2000 versus $15.8
million in 1999. For the fourth quarter of 2000, a loss of $9.6 million was
recorded versus EBIT of $3 million in the 1999 quarter. Included in the 2000
figures is a one-time charge of $8.4 million for the write-down of abandoned
assets. Operations for the 2000 periods were affected by lower coal prices.
Coal sales from company-owned mines were 9.8 million tons in 2000 versus 9.0
million tons in 1999.

     The Coastal Corporation (NYSE:CGP) is a Houston-based energy holding
company with consolidated assets of $18 billion and subsidiary operations in
natural gas transmission, storage, gathering/processing and marketing; oil and
gas exploration and production; petroleum refining, marketing and distribution;
chemicals; power production; and coal. Coastal and El Paso Energy Corporation
(NYSE:EPG) announced on Jan. 18, 2000, a definitive agreement to merge
Coastalwith a subsidiary of El Paso, subject to various approvals. The merger is
expected to be completed shortly. Coastal's World Wide Web site at
www.coastalcorp.com provides additional information on the company.

THE COASTAL CORPORATION AND SUBSIDIARIES

                                                    (millions except per share)
                                         Three Months            Twelve Months

PERIODS ENDED DECEMBER 31         2000        1999        2000         1999

Operating revenues              $6,059.1    $3,241.3   $18,013.9    $10,330.5
Operating costs and expenses
 Purchases                       4,953.6     2,428.9    14,133.5      7,282.0
 Operating and general expenses    555.1       420.5     2,032.5      1,687.2
 Depreciation, depiction and
  amortization                     215.8       131.0       662.5        479.6

                                 5,724.5     2.980.4     16.828.5       9.448.8


Other income - net                  53.8        44.4       191.0        146.4
Earnings before interest, income 
 taxes, and other charges          388.4       305.3     1,376.4      1,028.1
Interest and debt expense          107.8        83.3       409.5        323.3
Minority interest                   12.0         6.3        47.4         25.2
Taxes on income                     56.8        45.0       251.8        173.9

Earnings before preferred
 dividends                         211.8       170.7       667.7        505.7
Preferred stock dividends
 of subsidiaries                     3.5         1.7        13.3          6.8
Net earnings                       208.3       169.0       654.4        498.9
Dividends on preferred stock          .1          .3          .3           .3
Net earnings available
 to common stockholders         $  208.2     $ 168.9     $ 654.1      $ 498.6

Basic earnings per share        $     .97         .79    $   3.05     $   2.34
Average common shares              215.4       213.6       214.5        213.3

Diluted earnings per share      $     .93    $    .78    $   2.96     $   2.30
Diluted shares                      223.9       217.1       221.0        217.0

Earnings (loss) before interest and
income taxes by segment
Natural gas                     $  223.8     $ 157.8     $ 659.8      $ 573.8
Refining, marketing and
 chemicals                          57.9        42.6       259.8        228.5
Exploration and production         107.4        97.0       425.7        185.9
Power                               41.7        24.0       142.5         89.0
Coal                                (9.6)        3.0         3.1         15.8
Corporate and other                (32.8)      (19.1)     (114.5)       (64.9)
                                $  388.4     $ 305.3    $1,376.4     $1,028.1 

Operating revenues and purchases have been restated to apply SEC Staff
Accounting Bulletin No. 101 - "Revenue Recognition in Financial Statements".
In addition, certain other reclassifications were made to conform to the
current year presentation. Such restatement and reclassifications had no impact
on previously reported net earnings.


 This  information  includes certain forward-looking statements  reflecting  the
 Company's  expectations  and objectives in the future;  however,  many  factors
 which  may  affect the actual results, including commodity prices,  market  and
 economic  conditions,  industry  competition,  and  changing  regulations,  are
 difficult  to  predict. Accordingly, there is no assurance that  the  Company's
 expectations and objectives will be realized.

 The  terms "Coastal" "Company,"  "we," "our," "its" and "segment'  are  used
 in  this release for purposes of convenience and are intended to refer  to  The
 Coastal   Corporation   and/or   its  subsidiaries   either   individually   or
 collectively, as the context may require. These references are not intended  to
 suggest  that  the  various Coastal companies referred to are  not  independent
 corporate entities having their separate corporate identities and management.