Valero Logistics Operations, L.P. (the "Partnership"), a 100 percent-owned operating subsidiary of Valero L.P. (NYSE:VLI), announced today that it is offering to purchase for cash (i) all of its $100 million aggregate principal amount outstanding 6 7/8% Senior Notes due 2012 and (ii) all of its $250 million aggregate principal amount outstanding 6.05% Senior Notes due 2013 at a price in cash equal to 100% of the principal amount of the notes plus accrued an unpaid interest, if any, to the date of purchase. The Partnership is making the offer in order to satisfy its contractual obligation under the indenture governing the notes to commence a change of control offer within 30 days after the occurrence of a change of control, which occurred on December 22, 2006 when subsidiaries of Valero Energy Corporation closed the sale to the public of 20,550,000 units representing limited liability company interests in Valero GP Holdings, LLC, the owner of the general partner of the Partnership.

The Partnership will accept for payment all notes validly tendered (and not validly withdrawn) pursuant to the offer. Payment for such notes is expected to be made promptly, but no later than February 22, 2007. The offer will expire at 5:00 p.m., New York City time, on January 24, 2007. Any notes remaining outstanding after consummation of the offer will continue to be obligations of the Partnership under the indenture governing the notes. Holders of the notes are referred to the Partnership's Change in Control Notice and Offer to Purchase dated December 22, 2006 and the related Letter of Transmittal for the detailed terms and conditions of the offer.

The Partnership has retained The Bank of New York Trust Company, N.A. as the depository and paying agent for the offer. Questions and requests for assistance should be directed to The Bank of New York Trust Company, N.A., 212-815-3687, Attention: David A. Mauer. Requests for documents may be directed to The Bank of New York Trust Company, N.A. Beneficial owners may also contact their broker, deal, commercial bank or other nominee for assistance concerning the offer.

This announcement is not an offer to purchase or sell, or a solicitation of an offer to purchase or sell, any securities. The offer is being made solely pursuant to the above-described Change in Control Notice and Offer to Purchase dated December 22, 2006 and the related Letter of Transmittal.

About Valero Logistics Operations, L.P. and Valero L.P.
Valero Logistics Operations, L.P. is a 100 percent-owned operating subsidiary of Valero L.P., a publicly traded limited partnership.

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.nustarenergy.com.

This press release includes forward-looking statements regarding future events and the future financial performance of Valero Logistics Operations. All forward-looking statements are based on the partnership's beliefs as well as assumptions made by and information currently available to the Partnership. These statements reflect the partnership's current views with respect to future events and are subject to various risks, uncertainties and assumptions. These risks, uncertainties and assumptions are discussed in Valero L.P.'s 2005 annual report on Form 10-K and subsequent filings with the Securities and Exchange Commission.