Valero Energy Corporation (NYSE: VLO) today announced that its Board of Directors has approved a two-for-one stock split on its common stock, to be effected in the form of a stock dividend, subject to shareholder approval of an amendment to the company's certificate of incorporation to increase the number of authorized common shares. A special meeting of Valero's shareholders is tentatively planned for the fourth quarter of 2005.  In addition, upon completion of the stock split, management intends to recommend to the Board a 20 percent increase in the quarterly common stock cash dividend, from $0.05 per share to $0.06 per share.

“Given that our share price has more than doubled since our previous stock split in October of last year and that we’ve completed the acquisition of Premcor, now is a great time to split our stock again,” said Bill Greehey, Valero's Chairman of the Board and Chief Executive Officer.  “This proposed stock split reflects our continuing confidence that the positive earnings environment we are experiencing this year should continue well into the future.”
 
Valero Energy Corporation is a Fortune 500 company based in San Antonio, with approximately 22,000 employees and annual revenue of about $70 billion. The company owns and operates 18 refineries throughout the United States, Canada and the Caribbean with a combined throughput capacity of approximately 3.3 million barrels per day, making it the largest refiner in North America. Valero is also one of the nation's largest retail operators with more than 4,700 retail and branded wholesale outlets in the United States, Canada and the Caribbean under various brand names including Valero, Diamond Shamrock, Shamrock, Ultramar, and Beacon. Please visit www.valero.com for more information.

Statements contained in this press release that state the company's or management's expectations or predictions of the future are forward-looking statements intended to be covered by the safe harbor provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934. The words “believe,” “expect,” “should,” “estimates,” and other similar expressions identify forward-looking statements. It is important to note that the company’s actual results could differ materially from those projected in such forward-looking statements. For more information concerning factors that could cause actual results to differ from those expressed or forecast, see the proxy statement/prospectus dated July 13, 2005 regarding the merger of Valero and Premcor, and the amended Form S-4 Registration Statement filed with the Securities and Exchange Commission (as the same may be supplemented or amended). Also see both companies' reports, including annual reports on Form 10-K and quarterly reports on Form 10-Q, filed with the Securities and Exchange Commission and available on the Valero web site at www.valero.com.