TESORO CORPORATION ANNOUNCES PLANS TO BUILD NEW CORPORATE HEADQUARTERS CAMPUS IN NEW "CLASS A", MASTER-PLANNED OFFICE PARK BY PATRINELY GROUP

Office Park to Create New San Antonio Benchmark

SAN ANTONIO, TX (August 18, 2006) - Tesoro Corporation (NYSE:TSO) announced today that it will construct a new corporate headquarters campus in San Antonio. The campus will be located in a new "Class A", master-planned office park being developed by Patrinely Group of Houston, at the intersection of Highway 281 North and Redland Road, north of Loop 1604.

"Tesoro has more than doubled in size since we moved to our current office location in 1999. The new corporate headquarters campus is a reflection of our success and our plans for future growth," said Bruce Smith, Chairman, President and CEO of Tesoro Corporation. "Our company has been in San Antonio since 1968, making us one of the oldest publicly traded companies in the city. We are proud to call San Antonio home and we're excited to be a part of the new master-planned office park by world class developer, Patrinely Group."

Due to the significant growth the company has experienced over the past several years, Tesoro has outgrown its current headquarters, forcing its local employee base to be divided into two separate buildings in San Antonio. The new campus will bring all Tesoro employees back together in one location.

The new master-planned office park will be located on 122 acres of land on San Antonio's North side. Tesoro's corporate campus will utilize a portion of this property and will include approximately 600,000 square-feet of office space. Building upon a proven track record of success, Patrinely Group has chosen the Houston office of Gensler to design the overall master plan for the park, in addition to Tesoro's new headquarters campus, which is scheduled to be completed in 2009.

"We intend to create an exceptionally attractive Class A office park that will hopefully set a new benchmark for San Antonio," said Dean Patrinely, Managing Principal of Patrinely Group, LLC. "We are very pleased that Tesoro has decided to be our anchor tenant at the new office park."

Brokers in the land acquisition on behalf of Tesoro and Patrinely Group were Louis B. Cushman, Vice Chairman of Cushman & Wakefield of Texas, Inc., and San Antonio-based Steven W. Garza, President of Providence Commercial Real Estate Services, Inc. Engineering work is being done by San Antonio-based Pape-Dawson Engineering, Inc.

About Tesoro
Tesoro Corporation, a Fortune 200 company headquartered in San Antonio, Texas, is an independent refiner and marketer of petroleum products. Tesoro operates six refineries in the western United States with a combined rated crude oil capacity of more than 560,000 barrels per day. Tesoro's retail marketing system includes over 475 branded retail stations, of which over 200 are company operated under the Tesoro® and Mirastar® brands. Tesoro's commercial marketing system includes sales of jet fuel and marine fuels.

About Patrinely Group
Patrinely Group, LLC has been actively developing real estate since 1983, focusing on the creation and/or acquisition of state-of-the art office buildings, luxury residential condominiums and mixed-use projects, in addition to providing development management services to third-party clients. The company has completed build-to-suit projects for American Century Investments, Anadarko Petroleum, British Petroleum, Federal Express, USAA and IBM, as well as premier office and residential developments in Colorado, Virginia, Texas, Florida, New Jersey and Arizona.