HOUSTON, TX , a majority owned subsidiary of El Paso Corporation (NYSE: EP), announced today that it has determined the consideration to be paid in connection with its pending cash tender offer to purchase up to $189 million aggregate principal amount (as it may be increased, the Tender Cap) of its 7.35% Notes due February 15, 2031 (CUSIP No. 843452AY9) (the 2031 Notes), and its 8.0% Notes due March 1, 2032 (CUSIP No. 843452AZ6) (the 2032 Notes). The tender offer is subject to the terms and conditions set forth in SNG's Offer to Purchase dated May 23, 2008 (the Offer to Purchase).

Holders who validly tendered (and did not validly withdraw) notes in the tender offer at or prior to 5 p.m. Eastern Time on June 6, 2008, will receive $1,053.42 per $1,000 principal amount of 2031 Notes accepted for purchase and $1,129.84 per $1,000 principal amount of 2032 Notes accepted for purchase, which is referred to in the Offer to Purchase as the Full Tender Offer Consideration. In addition to the applicable Full Tender Offer Consideration stated above, holders whose notes are accepted for purchase will also receive any accrued and unpaid interest from the last interest payment date for the notes to, but not including, the settlement date, which SNG expects will occur on June 23, 2008. As of 5 p.m. Eastern Time on June 6, 2008, $146,219,000 principal amount of 2031 Notes and $54,713,000 principal amount of 2032 Notes had been validly tendered and not validly withdrawn.

Holders who validly tender notes in the tender offer after 5 p.m. Eastern Time on June 6, 2008, and at or prior to 12 midnight Eastern Time on June 20, 2008, which is the expiration date of the tender offer, will receive the applicable Full Tender Offer Consideration identified above minus the early tender premium of $30.00 per $1,000 principal amount, which is referred to in the Offer to Purchase as the Late Tender Offer Consideration, plus any accrued and unpaid interest from the last interest payment date for the notes to, but not including, the settlement date.

The consideration to be paid in connection with the tender offer was determined by Merrill Lynch & Co. and J.P. Morgan Securities Inc., the dealer managers for the tender offer, as of 2 p.m. Eastern Time on June 6, 2008, as set forth in the Offer to Purchase.

As set forth in the Offer to Purchase, the amount of a series of notes that is purchased in the tender offer will be based on the acceptance priority level for such series and may be prorated. The 2031 Notes, which are within the first acceptance priority level, will be purchased before the 2032 Notes, which are within the second acceptance priority level, and if the aggregate principal amount of 2031 Notes tendered exceeds the Tender Cap, no 2032 Notes will be accepted for purchase. SNG may increase the Tender Cap, subject to and in accordance with applicable law, without extending withdrawal rights. If the aggregate principal amount of notes of any series tendered exceeds the amount of the Tender Cap remaining available for application to the acceptance priority level for such series, then, if SNG accepts notes of such series for purchase, SNG will accept such notes on a pro rata basis.

SNG has retained Merrill Lynch & Co. and J.P. Morgan Securities Inc. to serve as the dealer managers for the tender offer and has retained Global Bondholder Services Corporation to serve as the depositary and information agent for the tender offer.

Requests for documents may be directed to Global Bondholder Services Corporation by telephone at (866) 952-2200 or (212) 430-3774 or in writing at 65 Broadway--Suite 723, New York, NY, 10006. Questions regarding the tender offer may be directed to Merrill Lynch & Co. at (888) 654-8637 or (212) 449-4914, or J.P. Morgan Securities Inc. at (866) 834-4666 or (212) 834-4802.

This press release is neither an offer to purchase nor a solicitation of an offer to sell the notes or any other securities. The tender offer is made only by and pursuant to the terms of the Offer to Purchase and the related letter of transmittal. None of SNG, the dealer managers or the depositary and information agent makes any recommendations as to whether holders should tender their notes pursuant to the tender offer. Holders must make their own decisions as to whether to tender notes, and, if so, the principal amount of notes to tender.

SNG is a Delaware general partnership, originally formed as a corporation in 1935. SNG is owned 90 percent by a wholly owned subsidiary of El Paso Corporation (El Paso) and 10 percent by a wholly owned subsidiary of El Paso Pipeline Partners, L.P. (NYSE: EPB). SNG's primary business consists of the interstate transportation and storage of natural gas. SNG conducts its business activities through its Southern Natural Gas pipeline system and related storage facilities.

El Paso Corporation provides natural gas and related energy products in a safe, efficient, dependable manner. El Paso Corporation owns North America's largest interstate natural gas pipeline system and one of North America's largest independent natural gas producers. For more information, visit http://www.elpaso.com.

Cautionary Statement Regarding Forward-Looking Statements

This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All forward-looking statements are based on assumptions that SNG believes to be reasonable. However, actual results almost always vary from assumed facts and the differences can be material, depending upon the circumstances. As a result, you should not place undue reliance on such forward-looking statements. The words "believe," "expect," "estimate," "anticipate" and similar expressions will generally identify forward-looking statements. All of SNG's forward-looking statements, whether written or oral, are expressly qualified by these cautionary statements and any other cautionary statements that may accompany such forward-looking statements. In addition, SNG disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date of this release.

With this in mind, you should consider the risks discussed in the Offer to Purchase, under the caption "Risk Factors" in SNG's Annual and Quarterly Reports on Forms 10-K and 10-Q and in the other documents SNG files with the SEC from time to time, which could cause actual results to differ materially from those expressed in any forward-looking statement made by SNG or on SNG's behalf.

Contacts Investor and Media Relations Bruce L. Connery Vice President Office: (713) 420-5855 Media Relations Bill Baerg Manager Office: (713) 420-2906

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