The Council of Ministers, during the meeting held today, has authorised the Sociedad Estatal de Participaciones Industriales to carry out a Public Share Offering of up to 30,002,859 Repsol shares, which are still in its portfolio and represent 10.001% of the company�s capital equity. In accordance with the Program of Modernization of the Public Industrial Sector, the Advisory Council on Privatizations (Consejo Consultivo de Privatizationes) issued, prior to this authorization, a favourable report on February 26th.

The months of April and May comprise the period established for this Public Share Offering, whose conditions have been approved by SEPI�s Board of Directors and sent to the Comisi�n Nacional del Mercado de Valores (CNMV). They establish a retail tranche for the Spanish market and an institutional tranche aimed toward both the domestic and international stock markets. At the same time, up to 15% of the shares belonging to SEPI will be destined initially to employees and pensioners of the Repsol Group, in compliance with the agreement of the Council of Ministers on the public sector, approved on June 28, 1996, which establishes expressly the principle of giving the employees a stake in the share equity of their companies.

Global Coordinators for the operation, appointed by SEPI�s Board of Directors this past December 27th, are BBV Interactivos, Banco Santander Investment and Goldman Sachs.

This Public Share Offering completes Repsol�s privatization, which began eight years ago. At present, 90% of the capital equity is in the hands of more than 600,000 shareholders, including private and institutional investors. In addition to the Sociedad Estatal de Participaciones Industriales which presently owns 10% of the capital equity, other significant stockholders are Banco Bilbao Vizcaya with 7%, the Mexican oil company, PEMEX, with 5%, and the Caixa with another 5%.

Repsol began its privatization in 1989 with a public share offering which lowered the stake held by INH to 69%. In 1990, the Mexican oil company, PEMEX, took up a 2.9% holding, and further increased it to 5% in 1992. In that year, Repsol launched an issue of exchangeable bonds and, in 1993, a public share offering directed to the institutional market. In April, 1995, it carried out a new offering of 19% of the capital equity, and in February, 1996, another of 11% of the shares, both by means of public offerings similar to that approved today by the Council of Ministers. These successive privatization processes produced an income for the State of approximately 700 billion pesetas.