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Unocal Replaces 101 Percent of Prod



Subject: Unocal Replaces 101 Percent of Production ......

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Unocal Replaces 101
               Percent of Production
               through Successful
               Indonesia, Gulf of Mexico
               Exploration Program

               PRNewswire
               08-FEB-99

               EL SEGUNDO, Calif., Feb. 8 /PRNewswire/ -- Unocal
               Corporation (NYSE: UCL) today said that it replaced 101
               percent of its worldwide crude oil and natural gas
production
               (excluding sales and price-related revisions) during 1998
               with new proved reserves as the company focused on
               adding value and re-energizing its domestic U.S.
exploration
               program. 

               "Our focused exploration and development program during
               1998 yielded significant reserve additions in both our
new
               growth areas and in our existing production operations,"
said
               Roger C. Beach, Unocal chairman and chief executive
               officer. 

               "We added more than 50 million barrels of proved oil
               reserves from our two new deepwater fields, Merah Besar
               and West Seno, in the Kutei Basin in Indonesia. In the
U.S.,
               our Spirit Energy 76 unit recorded more than 30
discoveries
               in the Gulf of Mexico shelf and onshore area and added 65
               MMBOE in proved reserves through discoveries and
               extensions, improved recovery and purchases," he said. 

               Beach went on to say that the company made major
               investments in 1998 to capture additional new exploration
               opportunities that have increased the resource potential
of
               Unocal's portfolio. "The new exploration prospects in
Africa,
               Latin America and Asia offer the potential for
significant
               reserve additions in the years to come," he said.
               International Operations 

               Unocal's international operations replaced 114 percent of
               production in 1998 (excluding sales and price-related
               revisions), primarily through exploration drilling. This
               included net additions of 55 MMBOE in Indonesia, 30
               MMBOE in Thailand, and 15 MMBOE in Bangladesh. For

               the year, the preliminary finding, development and
               acquisition (FD&A) costs for new reserves in Unocal's
               international operations (excluding price-related
revisions)
               were $7.70 per BOE in the Far East and $8.03 per BOE for
               total international operations. 

               International FD&A costs rose in 1998 due to several
timing
               factors, including spending on the pipeline in Myanmar,
entry
               costs in Gabon, India, Bangladesh and Brazil, and the
impact
               of the company's "just-in-time" exploration program in
               Thailand. Spirit Energy 76 

               Spirit Energy 76 replaced 108 percent of its production
               (excluding sales and price-related revisions),
particularly as
               a result of a 64-percent exploration success rate on the
Gulf
               of Mexico shelf during the year. Spirit Energy's
preliminary
               finding, development and acquisition costs (excluding
               price-related revisions) for new reserves in 1998 on the
               GOM shelf and onshore were $7.26 per BOE. 

               "Spirit's success in 1998 was the first time in many
years that
               its replacement ratio exceeded 100 percent," Beach said.
               "Our new projects have projected returns of 15 to 20
               percent, and we expect even higher returns as we move
               forward with our deepwater program in the Gulf of
Mexico."
               Resource Potential 

               With the current growth portfolio, Unocal estimates its
total
               oil and gas risked resource base at 6.0 to 8.2 billion
BOE,
               including year-end 1998 proved oil and gas reserves of
1.55
               billion BOE. The estimate is up from 4.8 to 6.7 billion
BOE
               last year, which included proved reserves of 1.63 billion
               BOE. The additional potential comes principally from new
               prospects in the deepwater Gulf of Mexico, Gabon,
               Bangladesh, Indonesia, Brazil and Vietnam. (The unproved
               resource base includes discovered and potential resources
               with price and market risk. It also includes targeted
               opportunities not yet captured by contract, which
aggregated
               approximately 650 MMBOE at year-end 1998, compared
               with approximately 1,100 MMBOE in mid-1998.) 

               Unocal is a leading global oil and gas exploration and
               production company with significant pipeline and power
plant
               project developments worldwide. For more information
about
               the company, visit Unocal's website at www.unocal.com.
               Forward-looking statements and estimates regarding
               reserves, returns on investment, future reserve
replacement
               and resource potential in this news release are based on
               assumptions concerning market, competitive, regulatory,
               geological, pricing, environmental, operational and other

               considerations. Actual results could differ materially. 

               The attached tables provide details on the company's
               reserves and FD&A costs. Unocal Corporation 


                                   Crude Oil and Natural Gas Reserve
Data
               Estimated proved reserves of crude oil, condensate and
natural gas
                                                 Crude Oil/      Natural
Gas  Oil equivalent
                                                  (MMbbls)          
(bcf)         (MMBOE)
                   1998 beginning reserves             533          
6,550         1,625
                    Discoveries/extensions              81            
437           154
                    Improved recovery                    6             
20             9
                    Revisions
                    - Price-related                    (23)           
(15)          (26)
                    - Other                             14           
(51)             6
                    Purchases                            7             
52            15
                    Sales                              (19)          
(181)          (49)
                   Production                          (67)          
(690)         (182)
                   1999 beginning reserves*            532          
6,122         1,552
                   *Includes host country shares for
                    Indonesia, Yemen and Democratic
                    Republic of Congo of:               44            
389           109
               Estimated proved reserves by geographic area (millions of
BOE)
                                   Spirit       Other         
Far        Other       Total

               Energy 76 U.S. East International 


                   1998 beginning
                    reserves         406          156         
856          207       1,625
                     Discoveries/
                      extensions      45            6          
87           16         154
                     Improved
                      recovery         5            2           
1            1           9
                     Revisions
                     - Price-related  (8)         (15)         
--           (3)        (26)
                     - Other           6           (3)        
(12)          15           6
                     Purchases        15           --          
--           --          15
                     Sales           (21)          --          
--          (28)        (49)
                   Production        (66)         (21)        
(83)         (12)       (182)
                   1999 beginning
                    reserves*        382          125         
849          196       1,552
                   *Includes host
                    country shares
                    for Indonesia,
                    Yemen and
                    Democratic
                    Republic of
                    Congo of:         --           --         
104            5         109
                   Note: Other U.S. is principally Alaska.  Far East

includes Thailand,

               Indonesia and Myanmar. Other international includes
               Azerbaijan, Bangladesh, Canada, Democratic Republic of
               Congo, Netherlands and Yemen. Unocal Corporation 


                    Preliminary 1998 finding, development and
acquisition costs per BOE
                                                                 Spirit
Energy 76
                                                   Deepwater         
Other         Total
                   Costs incurred (MM$)
                    Exploration                        319            
262           581
                    Development                          5            
202           207
                    Proved property acquisitions        --             
53            53
                      Total costs incurred             324            
517           841
                   Reserve data (MMBOE)
                    Discoveries/extensions              --             
45            45
                    Improved recovery                   --              
5             5
                    Purchases                           --             
15            15
                      Subtotal                          --             
65            65
                    Revisions - price related          --              
(8)           (8)
                    Revisions - other                   --              
6             6
                      Total changes                     --             
63             63
                   Finding and development costs
                    per BOE*
                     Excluding price revisions          --          
$8.36        $14.20
                     Excluding all revisions            --          
$9.32        $15.83
                     Including revisions                --          
$9.73        $16.53
                   Finding, development and
                    acquisition costs per BOE
                     Excluding price revisions          --          
$7.26        $11.81
                     Excluding revisions                --          
$7.89        $12.84
                     Including revisions                --          
$8.16        $13.27
                   * Excludes proved property acquisition costs and
purchases volumes
                                             Unocal Corporation
                    Preliminary 1998 finding, development and
acquisition costs per BOE
                                             Other       Far    
Other    Total      Total
                                           Domestic     East    
Int'l     Int'l
                   Costs
                    incurred
                    (MM$)
                     Exploration                 3       209      
167      376        960
                     Development                42       378      
116      494        743
                     Proved property
                      acquisitions              --        --       
10       10         63
                       Total costs
                        incurred                45       587      

293      880      1,766
                   Reserve data (MMBOE)
                    Discoveries/
                     extensions                  6        87       
16      103        154
                    Improved recovery            2         1        
1        2          9
                    Purchases                   --        --       
--       --         15
                     Subtotal                    8        88       
17      105        178
                    Revisions
                    - price related            (15)       --       
(3)      (3)       (26)
                    Revisions
                    - other                     (3)      (12)      
15        3          6
                     Total changes             (10)       76       
29      105        158
                   Finding and
                    development
                    costs
                    per BOE*
                     Excluding
                      price
                      revisions             $11.08     $7.70    
$8.49    $7.94     $10.07
                     Excluding all
                      revisions              $6.52     $6.65   
$15.62    $8.18     $10.44
                     Including
                      revisions            ($4.23)     $7.70    
$9.46    $8.19     $11.90
                   Finding,
                    development and
                    acquisition costs
                    per BOE
                     Excluding price
                      revisions             $11.08     $7.70    
$8.80    $8.03      $9.56
                     Excluding
                      revisions              $6.52     $6.65   
$16.19    $8.23      $9.88
                     Including
                      revisions            ($4.23)     $7.70    
$9.81    $8.29     $11.12
                   * Excludes proved property acquisition costs and
purchases volumes