<SUBMISSION>
<ACCESSION-NUMBER>0001110805-05-000019
<TYPE>8-K
<PUBLIC-DOCUMENT-COUNT>2
<PERIOD>20050426
<ITEMS>2.02
<ITEMS>9.01
<FILING-DATE>20050426
<DATE-OF-FILING-DATE-CHANGE>20050426
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>VALERO L P
<CIK>0001110805
<ASSIGNED-SIC>4610
<IRS-NUMBER>742956831
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>8-K
<ACT>34
<FILE-NUMBER>001-16417
<FILM-NUMBER>05771639
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>P.O. BOX 696000
<CITY>SAN ANTONIO
<STATE>TX
<ZIP>78269-6000
<PHONE>2103452000
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>P.O. BOX 696000
<CITY>SAN ANTONIO
<STATE>TX
<ZIP>78269-6000
</MAIL-ADDRESS>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>SHAMROCK LOGISTICS LP
<DATE-CHANGED>20000331
</FORMER-COMPANY>
</FILER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>f8k042605.htm
<TEXT>
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<HEAD>
<TITLE></TITLE>
     <!-- Created by EDGAR Ease Plus (EDGAR Ease+) -->
     <!-- Project:        V:\OCS\EdgarEase\VLI\Form 8-K\2005\04 26 Form 8-K [Earnings Release]\f8k042605.eep -->
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     <!-- Client Name:    Valero L.P.                                                      -->
     <!-- Project Name:   Earnings Release                                                 -->
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<BODY bgColor=#ffffff><P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><FONT face="Times New Roman" size=2>UNITED STATES</FONT></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><FONT face="Times New Roman" size=2>SECURITIES AND EXCHANGE COMMISSION</FONT></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><FONT face="Times New Roman" size=2>Washington, D.C. 20549</FONT></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><B><FONT face="Times New Roman" size=2>FORM 8-K</FONT></B></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><B><FONT face="Times New Roman" size=2>CURRENT REPORT</FONT></B></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><B><FONT face="Times New Roman" size=2>Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934</FONT></B></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><FONT face="Times New Roman"><FONT size=2>Date of Report (Date of earliest event reported): <B>April 26, 2005</B></FONT></FONT></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><B><FONT face="Times New Roman" size=2>VALERO L.P.</FONT></B></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><FONT face="Times New Roman" size=2>(Exact name of registrant as specified in its charter)</FONT></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

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<P style="TEXT-ALIGN: center" align=center><B><FONT face="Times New Roman" size=2>Delaware</FONT></B></P>
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<P style="TEXT-ALIGN: center" align=center><B><FONT face="Times New Roman" size=2>1-16417</FONT></B></P>
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<P style="TEXT-ALIGN: center" align=center><B><FONT face="Times New Roman" size=2>74-2956831</FONT></B></P>
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<P style="TEXT-ALIGN: center" align=center><FONT face="Times New Roman" size=2>State or other jurisdiction</FONT></P>
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<P style="TEXT-ALIGN: center" align=center><FONT face="Times New Roman" size=2>(Commission File Number)</FONT></P>
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<P style="TEXT-ALIGN: center" align=center><FONT face="Times New Roman" size=2>(IRS Employer</FONT></P>
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<P style="TEXT-ALIGN: center" align=center><FONT face="Times New Roman" size=2>Of incorporation</FONT></P>
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<P><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>
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<P style="TEXT-ALIGN: center" align=center><FONT face="Times New Roman" size=2>Identification No.)</FONT></P>
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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<TABLE style="BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="100%" border=0>
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<P style="TEXT-ALIGN: center" align=center><B><FONT face="Times New Roman" size=2>One Valero Way</FONT></B><B></B></P>
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<P style="TEXT-ALIGN: center" align=center><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>
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<P style="TEXT-ALIGN: center" align=center><B><FONT face="Times New Roman" size=2>San Antonio, Texas</FONT></B><B></B></P>
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<P style="TEXT-ALIGN: center" align=center><B><FONT face="Times New Roman" size=2>78249</FONT></B><B></B></P>
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<P style="TEXT-ALIGN: center" align=center><FONT face="Times New Roman" size=2>(Address of principal executive offices)</FONT></P>
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<P style="TEXT-ALIGN: center" align=center><FONT face="Times New Roman" size=2>(Zip Code)</FONT></P>
</TD></TR>
</TABLE>


<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-INDENT: 0.5in; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><FONT face="Times New Roman"><FONT size=2>Registrant&#146;s telephone number, including area code: <B>(210) 345-2000</B></FONT></FONT></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><FONT face="Times New Roman" size=2>_______________________</FONT></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.5in; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2>Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):</FONT></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

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<TD vAlign=top width="2%">

<P><FONT face="Times New Roman" size=2>[ </FONT></P>
</TD>
<TD vAlign=top width="97%">

<P><FONT face="Times New Roman" size=2>] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)</FONT></P>
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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

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<TD vAlign=top width="2%">

<P><FONT face="Times New Roman" size=2>[ </FONT></P>
</TD>
<TD vAlign=top width="97%">

<P><FONT face="Times New Roman" size=2>] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)</FONT></P>
</TD></TR>
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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2>[ &nbsp;&nbsp;] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))</FONT></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2>[ &nbsp;&nbsp;] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))</FONT></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>
<BR><FONT face="Times New Roman" size=2>
<HR align=center width="100%" noShade SIZE=2>
</FONT>
<P style="PAGE-BREAK-BEFORE: always"></P>

<DIV id=Edgar-Page style="PAGE-BREAK-BEFORE: always"><FONT face="Times New Roman" size=2></FONT>&nbsp;</DIV>
<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.5in; TEXT-ALIGN: center"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

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<TD vAlign=top width="22%">

<P><B><FONT face="Times New Roman" size=2>Item 2.02 </FONT></B></P>
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<TD vAlign=top width="77%">

<P><B><FONT face="Times New Roman" size=2>Results Of Operations And Financial Condition.</FONT></B></P>
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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><FONT face="Times New Roman" size=2>On April 26, 2005, Valero L.P., a Delaware limited partnership, issued a press release announcing financial results for the quarter ended March 31, 2005. A copy of the press release announcing the financial results is furnished with this report as Exhibit 99.1, and is incorporated herein by reference.</FONT></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><FONT face="Times New Roman" size=2>The information in this report is being furnished, not filed, pursuant to Item 2.02 of Form 8-K. Accordingly, the information in this report, including the press release, will not be incorporated by reference into any registration statement filed by the Company under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein by reference.</FONT></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2>NON-GAAP FINANCIAL MEASURES</FONT></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><FONT face="Times New Roman" size=2>The press release announcing the earnings discloses certain financial measures, EBITDA and distributable cash flow, that are non-GAAP financial measures as defined under SEC rules. The press release furnishes a reconciliation of these non-GAAP financial measures to their nearest GAAP financial measures. Management uses these financial measures because they are widely accepted financial indicators used by investors to compare partnership performance. In addition, management believes that these measures provide investors an enhanced perspective of the operating performance of the partnership&#146;s assets and the cash that the business is generating. Neither EBITDA nor distributable cash flow are intended to represent cash flows for the period, nor are they presented as an alternative to net income or cash flow from operations. They should not be considered in isolation or as substitutes for a measure
of performance prepared in accordance with United States generally accepted accounting principles.</FONT></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

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<P><B><FONT face="Times New Roman" size=2>Item 9.01</FONT></B></P>
</TD>
<TD vAlign=top width="72%">

<P><B><FONT face="Times New Roman" size=2>Financial Statements and Exhibits.</FONT></B></P>
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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

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<P><FONT face="Times New Roman" size=2>(c)</FONT></P>
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<P><FONT face="Times New Roman" size=2>Exhibits.</FONT></P>
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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.5in; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

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<TD vAlign=top width="16%">

<P><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>
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<P><FONT face="Times New Roman" size=2>Press Release dated April 26, 2005.</FONT></P>
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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.5in; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>
<BR><FONT face="Times New Roman" size=2>
<HR align=center width="100%" noShade SIZE=2>
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<P style="PAGE-BREAK-BEFORE: always"></P>

<DIV id=Edgar-Page style="PAGE-BREAK-BEFORE: always"><FONT face="Times New Roman" size=2></FONT>&nbsp;</DIV>
<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><B><FONT face="Times New Roman" size=2>SIGNATURE</FONT></B></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 6pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2>Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.</FONT></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>

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<P><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>
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<P><FONT face="Times New Roman" size=2>VALERO L.P.</FONT></P>
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<P><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>
</TD>
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<P><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>
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<P><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>
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<P><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>
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<P><FONT face="Times New Roman" size=2>By:</FONT></P>
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<TD style="PADDING-RIGHT: 5.75pt; PADDING-LEFT: 5.75pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" vAlign=top colSpan=4>

<P><FONT face="Times New Roman" size=2>Riverwalk Logistics, L.P.<BR>its general partner</FONT></P>
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<P><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>
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<P><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>
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<P><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>
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<P><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>
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<TD style="PADDING-RIGHT: 5.75pt; PADDING-LEFT: 5.75pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" vAlign=top width="6%">

<P><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>
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<P><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>
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<P><FONT face="Times New Roman" size=2></FONT>&nbsp;</P>
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<P><FONT face="Times New Roman" size=2>By:</FONT></P>
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<TD style="PADDING-RIGHT: 5.75pt; PADDING-LEFT: 5.75pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" vAlign=top colSpan=2>

<P><FONT face="Times New Roman" size=2>Valero GP, LLC<BR>its general partner</FONT></P>
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<P><FONT face="Times New Roman" size=2>Date: April 26, 2005</FONT></P>
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<P><FONT face="Times New Roman" size=2>Bradley C. Barron</FONT></P>
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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><B><FONT face="Times New Roman" size=2>EXHIBIT INDEX</FONT></B></P>

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<P><FONT face="Times New Roman" size=2><A HREF="f8k0426er.htm">99.1</A></FONT></P>
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<P><FONT face="Times New Roman" size=2><A HREF="f8k0426er.htm">Press Release dated April 26, 2005.</A></FONT></P>
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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: right"><B><FONT face="Times New Roman" size=2><A HREF="f8k0426er.htm">Exhibit 99.1</A></FONT></B></P>

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     <!-- Client Name:    Valero L.P.                                                      -->
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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><B><FONT face="Times New Roman" size=2>VALERO L.P. REPORTS FIRST QUARTER 2005 EARNINGS </FONT></B></P>

<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><B><FONT face="Times New Roman" size=2>AND ANNOUNCES QUARTERLY DISTRIBUTION</FONT></B></P>

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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; LINE-HEIGHT: 130%; TEXT-ALIGN: justify"><FONT face="Times New Roman" size=2>SAN ANTONIO, April 26, 2005 -- Valero L.P. (NYSE: VLI) today announced net income applicable to limited partners of $17.8 million, or $0.77 per unit, for the first quarter of 2005, compared to $18.5 million, or $0.80 per unit, for the first quarter of 2004. Distributable cash flow available to limited partners for the first quarter was $23.1 million, compared to $23.2 million for the first quarter of 2004. </FONT></P>

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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; LINE-HEIGHT: 130%; TEXT-ALIGN: justify"><FONT face="Times New Roman" size=2>Valero L.P. also announced that it has declared a distribution for the first quarter of 2005 of $0.80 per unit payable May 13, 2005 to holders of record as of May 6, 2005. Distributable cash flow covers the distribution to the limited partners by 1.25 times. </FONT></P>

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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; LINE-HEIGHT: 130%; TEXT-ALIGN: justify"><FONT face="Times New Roman" size=2>For the first quarter of 2005, revenues were higher than in the first quarter of last year primarily due to the acquisition of two asphalt terminals from Royal Trading in February of last year, higher throughputs in the crude oil storage tank business segment and the completion of the new propane storage and distribution terminal in Nuevo Laredo, Mexico in June of last year. Despite higher revenues, net income applicable to limited partners in the first quarter of 2005 was lower than in the first quarter of 2004, primarily due to higher operating and administrative expenses. Higher administrative costs in the first quarter were primarily due to the April 2004 amendment of the service agreement with Valero Energy and costs associated with the pending merger with Kaneb Pipe Line Partners, L.P. and Kaneb Services LLC. In addition, an outage in late March on the partnership&#146;s
Corpus Christi to Houston pipeline also impacted its results. </FONT></P>

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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; LINE-HEIGHT: 130%; TEXT-ALIGN: justify"><FONT face="Times New Roman" size=2>&#147;We continue to benefit from our strategic growth investments,&#148; said Curt Anastasio, Valero L.P.&#146;s Chief Executive Officer. &#147;In particular, we benefited from the new Royal Trading asphalt terminals located near Tulsa, Oklahoma and Santa Fe, New Mexico we acquired in February 2004 and our propane storage and distribution terminal in Nuevo Laredo, Mexico, which we refer to as the Dos Laredos system. Starting in the second quarter, we expect to see higher propane throughput volumes on our Dos Laredos system, reflecting the strong demand in the rapidly growing northern Mexico region. In fact, thus far in April we are averaging around 8,500 barrels per day compared to 6,000 barrels per day in the first quarter. </FONT></P>

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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; LINE-HEIGHT: 130%; TEXT-ALIGN: justify"><FONT face="Times New Roman" size=2>&#147;With regard to the Kaneb acquisition, the companies continue to work diligently to complete the transaction during the second quarter. The proposed acquisitions by Valero L.P. of Kaneb Partners and Kaneb Services were approved by the unitholders of Valero L.P. and </FONT></P>

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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; LINE-HEIGHT: 130%; TEXT-ALIGN: center"><FONT face="Times New Roman" size=2>-More-</FONT></P>

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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; LINE-HEIGHT: 130%; TEXT-ALIGN: justify"><FONT face="Times New Roman" size=2>Kaneb Partners and the shareholders of Kaneb Services in special meetings held on March 11, 2005. We look forward to the growth opportunities that the larger, more diversified entity will possess.</FONT></P>

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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; LINE-HEIGHT: 130%; TEXT-ALIGN: justify"><FONT face="Times New Roman" size=2>&#147;Looking at the second quarter, Valero Energy&#146;s Ardmore and Three Rivers refineries are currently down for scheduled plant-wide turnarounds. Since we own crude and refined product pipelines and terminals that serve each of these plants, we expect this to have an effect on our second quarter earnings. Taking the turnarounds into account and excluding any potential contribution from our acquisition of Kaneb, we currently expect second quarter earnings to be slightly lower than first quarter earnings,&#148; said Anastasio. </FONT></P>

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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; LINE-HEIGHT: 130%; TEXT-ALIGN: justify"><FONT face="Times New Roman" size=2>A conference call with management is scheduled for 11:00 a.m. ET (10:00 a.m. CT) today, April 26, 2005, to discuss the financial and operational results for the first quarter of 2005. Anyone interested in listening to the presentation may call 866/261-8578, passcode 5354816. The company intends to have a playback available following the presentation and may be accessed by calling 800/642-1687, passcode 5354816. A live broadcast of the conference call will also be available on the company&#146;s website at <U>www.valerolp.com</U>.</FONT></P>

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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; LINE-HEIGHT: 130%; TEXT-ALIGN: left"><FONT face="Times New Roman" size=2>A master limited partnership, Valero L.P. (NYSE: VLI) owns and operates crude oil and refined product pipelines, refined product terminals and crude oil storage facilities located predominantly in Texas, New Mexico, Colorado, Oklahoma, California, New Jersey and Mexico. The partnership&#146;s crude oil pipelines and storage facilities supply nine of Valero Energy Corporation&#146;s key refineries with domestic and foreign crude oil and other feedstocks. Its refined product pipelines and terminals primarily supply gasoline and distillates to established and growing markets in the Mid-Continent, Southwest and Texas-Mexico border region of the United States. Valero L.P.&#146;s primary customer is Valero Energy Corporation, which has a limited partnership interest and 2 percent general partnership interest in Valero L.P. </FONT></P>

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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><I><FONT face="Times New Roman" size=2>Cautionary Statement Regarding Forward-Looking Statements </FONT></I></P>

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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><I><FONT face="Times New Roman" size=2>This press release includes forward-looking statements within the meaning of the Securities Litigation Reform Act of 1995 regarding future events and the future financial performance of Valero L.P. All forward-looking statements are based on the partnership&#146;s beliefs as well as assumptions made by and information currently available to the partnership. These statements reflect the partnership&#146;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.&#146;s 2004 annual report on Form 10-K and subsequent filings with the Securities and Exchange Commission including the definitive joint proxy statement/prospectus referred to in this press release. </FONT></I></P>

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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><FONT face="Times New Roman"><FONT size=2><I>For more information, visit Valero L.P.&#146;s website at </I><U>www.valerolp.com</U><I>. </I></FONT></FONT></P>

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<P style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><FONT face="Times New Roman" size=2>-30-</FONT></P>

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<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>Valero L.P.<BR>Consolidated Financial Information<BR>March 31, 2005 and 2004<BR>(unaudited, in thousands, except unit data and per unit data)</B> </FONT></P>

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<TH colSpan=6><FONT face="Times New Roman, Times, Serif" size=1>Three Months Ended<BR>March 31,</FONT>
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<TH colSpan=3><FONT face="Times New Roman, Times, Serif" size=1>2005</FONT>
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<TD align=left width="64%"><FONT face="Times New Roman, Times, Serif" size=2><B>Statement of Income Data:</B></FONT></TD>
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<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="12%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="5%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="12%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
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<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;Revenues</FONT></TD>
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<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>56,635</FONT></TD>
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<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>52,324</FONT></TD>
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<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;Costs and expenses:</FONT></TD>
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<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating expenses</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>19,685</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>17,908</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;General and administrative expenses</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,503</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,999</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>8,732</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>7,874</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total costs and expenses</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>31,920</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>27,781</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;<B>Operating income</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>24,715</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>24,543</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Equity income from Skelly-Belvieu</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pipeline Company</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>378</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>553</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest and other expense, net</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(5,829</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(5,126</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;<B>Net income</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>19,264</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>19,970</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net income applicable to general partner</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;including incentive distributions (Note 1)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,476</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,489</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;Net income applicable to limited partners</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>17,788</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>18,481</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=2>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=2>
</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;Net income per unit applicable to limited</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;partners (Note 1)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0.77</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0.80</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;Weighted average number of limited</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;partnership units outstanding</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>23,041,394</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>23,041,394</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;Earnings before interest, taxes and</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;depreciation and amortization (EBITDA, Note 2)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>33,825</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>32,970</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;Distributable cash flow (Note 2)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>26,193</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>26,262</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=center><FONT face="Times New Roman, Times, Serif" size=1><B>March 31,</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=center><FONT face="Times New Roman, Times, Serif" size=1><B>December 31,</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=center><FONT face="Times New Roman, Times, Serif" size=1><B>2005</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=center><FONT face="Times New Roman, Times, Serif" size=1><B>2004</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=center colSpan=2>
<HR width="60%" color=#000000 noShade SIZE=1>
</TD>
<TD></TD>
<TD align=center colSpan=2>
<HR width="60%" color=#000000 noShade SIZE=1>
</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><B>Balance Sheet Data:</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;Long-term debt, including current portion (a)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>385,057</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>385,161</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;Partners' equity (b)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>437,642</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>438,311</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;Debt-to-capitalization ratio (a) / ((a)+(b))</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>46.8%</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>46.8%</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD></TR>
</TABLE>


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<A name=A003></A>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>Valero L.P.<BR>Consolidated Financial Information &#151; Continued <BR>March 31, 2005 and 2004<BR>(unaudited, in thousands, except barrel information)</B> </FONT></P>

<TABLE cellSpacing=0 cellPadding=0 width="75%" border=0>
<TR vAlign=bottom>
<TH colSpan=3><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=6><FONT face="Times New Roman, Times, Serif" size=1>Three Months Ended<BR>March 31,</FONT>
<HR width="60%" color=black noShade SIZE=1>
</TH></TR>
<TR vAlign=bottom>
<TH colSpan=3><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=3><FONT face="Times New Roman, Times, Serif" size=1>2005</FONT>
<HR width="60%" color=black noShade SIZE=1>
</TH>
<TH colSpan=3><FONT face="Times New Roman, Times, Serif" size=1>2004</FONT>
<HR width="60%" color=black noShade SIZE=1>
</TH></TR>
<TR vAlign=bottom>
<TD align=left width="64%"><FONT face="Times New Roman, Times, Serif" size=2><B>Operating Data:</B></FONT></TD>
<TD align=left width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left width="3%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="12%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="4%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="12%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Crude oil pipelines:</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Throughput (barrels/day)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>381,086</FONT></P>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>381,832</FONT></P>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Revenues</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>13,185</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>12,792</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating expenses</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,823</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,234</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,146</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,098</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Segment operating income</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>8,216</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>8,460</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=2>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=2>
</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Refined product pipelines:</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Throughput (barrels/day)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>443,993</FONT></P>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>437,207</FONT></P>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Revenues</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>22,182</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>20,526</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating expenses</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>9,303</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>8,538</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,857</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,778</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Segment operating income</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>9,022</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>8,210</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=2>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=2>
</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Refined product terminals:</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Throughput (barrels/day)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>253,531</FONT></P>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>254,950</FONT></P>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Revenues</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>9,937</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>8,810</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating expenses</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4,497</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4,333</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,859</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,132</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Segment operating income</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,581</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,345</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=2>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=2>
</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Crude oil storage tanks:</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Throughput (barrels/day)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>505,643</FONT></P>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>461,102</FONT></P>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Revenues</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>11,331</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>10,196</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating expenses</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,062</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,803</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,870</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,866</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Segment operating income</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>7,399</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>6,527</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=2>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=2>
</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Consolidated Information:</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Throughput (barrels/day)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>1,584,253</FONT></P>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>1,535,091</FONT></P>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Revenues</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>56,635</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>52,324</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating expenses</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>19,685</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>17,908</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>8,732</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>7,874</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Segment operating income</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>28,218</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>26,542</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;General and administrative expenses</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,503</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,999</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Consolidated operating income</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>24,715</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>24,543</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=2>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=2>
</TD>
<TD></TD></TR>
</TABLE>


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<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>Valero L.P.<BR>Consolidated Financial Information &#151; Continued<BR>March 31, 2005 and 2004<BR>(unaudited)</B> </FONT></P>

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<H1 align=left><FONT face="Times New Roman, Times, Serif" size=3>Notes: </FONT></H1>

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<TR vAlign=top>
<TD width="5%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp; </FONT></TD>
<TD width="5%"><FONT face="Times New Roman, Times, Serif" size=2>1. </FONT></TD>
<TD><FONT face="Times New Roman, Times, Serif" size=2>&nbsp; </FONT></TD>
<TD width="90%"><FONT face="Times New Roman, Times, Serif" size=2>Net income is allocated between limited partners and the general partner&#146;s interests based on provisions in the partnership agreement. The net income applicable to limited partners is divided by the weighted average number of limited partnership units outstanding in computing the net income per unit applicable to limited partners. Net income applicable to the general partner includes incentive distributions aggregating $1.1 million for each of the three months ended March 31, 2005 and 2004. </FONT></TD></TR>
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<BR>
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<TR vAlign=top>
<TD width="5%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp; </FONT></TD>
<TD width="5%"><FONT face="Times New Roman, Times, Serif" size=2>2. </FONT></TD>
<TD><FONT face="Times New Roman, Times, Serif" size=2>&nbsp; </FONT></TD>
<TD width="90%"><FONT face="Times New Roman, Times, Serif" size=2>Valero L.P. utilizes two financial measures, EBITDA and distributable cash flow, which are not defined in United States generally accepted accounting principles. Management uses these financial measures because they are widely accepted financial indicators used by investors to compare partnership performance. In addition, management believes that these measures provide investors an enhanced perspective of the operating performance of the partnership&#146;s assets and the cash that the business is generating. Neither EBITDA nor distributable cash flow are intended to represent cash flows for the period, nor are they presented as an alternative to net income. They should not be considered in isolation or as substitutes for a measure of performance prepared in accordance with United States generally accepted accounting principles. </FONT></TD></TR>
</TABLE>

<BR>
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<TABLE cellSpacing=0 cellPadding=0 width="100%">
<TR vAlign=top>
<TD width="5%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp; </FONT></TD>
<TD width="5%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp; </FONT></TD>
<TD><FONT face="Times New Roman, Times, Serif" size=2>&nbsp; </FONT></TD>
<TD width="90%"><FONT face="Times New Roman, Times, Serif" size=2>The following is a reconciliation of net income to EBITDA and distributable cash flow (in thousands): </FONT></TD></TR>
</TABLE>

<BR>
<TABLE cellSpacing=0 cellPadding=0 width="75%" align=center border=0>
<TR vAlign=bottom>
<TH colSpan=3><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=6><FONT face="Times New Roman, Times, Serif" size=1>Three Months Ended<BR>March 31,</FONT>
<HR width="60%" color=black noShade SIZE=1>
</TH></TR>
<TR vAlign=bottom>
<TH colSpan=3><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=3><FONT face="Times New Roman, Times, Serif" size=1>2005</FONT>
<HR width="60%" color=black noShade SIZE=1>
</TH>
<TH colSpan=3><FONT face="Times New Roman, Times, Serif" size=1>2004</FONT>
<HR width="60%" color=black noShade SIZE=1>
</TH></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left width="67%"><FONT face="Times New Roman, Times, Serif" size=2>Net income</FONT></TD>
<TD align=left width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left width="3%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2>19,264</FONT></TD>
<TD align=left width="5%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2>19,970</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;Plus interest and other expense, net</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>5,829</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>5,126</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;Plus depreciation and amortization</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>8,732</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>7,874</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><B>EBITDA</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>33,825</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>32,970</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;Less equity income from Skelly-Belvieu</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;Pipeline Company</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(378</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(553</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;Less interest and other expense, net</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(5,829</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(5,126</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;Less reliability capital expenditures</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,425</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,717</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;Plus distributions from Skelly-Belvieu</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pipeline Company</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>688</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><B>Distributable cash flow</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>26,193</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>26,262</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>General Partner interest in distributable</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>cash flow</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(3,073</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(3,091</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=1>
</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Limited Partners' interest in distributable</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom bgColor=#cceeff>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>cash flow</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>23,120</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>23,171</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=3></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=2>
</TD>
<TD></TD>
<TD align=right colSpan=2>
<HR color=#000000 noShade SIZE=2>
</TD>
<TD></TD></TR>
</TABLE>


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