EXHIBIT 99.1



                                             For more information contact:
                                             Katherine Hughes, Public Relations
                                             210/641-8846
                                             or
                                             Mary Hartman, Investor Relations
                                             210/641-8840



ULTRAMAR DIAMOND SHAMROCK MERGER COMPLETE;
GROWTH OPPORTUNITIES CITED

NEW YORK -- Dec. 3, 1996 -- In separate meetings this morning in New York,
shareholders of Diamond Shamrock Inc. and Ultramar Corporation approved the
previously announced merger agreement of the two companies, finalizing the
formation of a new $4 billion corporation, Ultramar Diamond Shamrock
Corporation, which will trade on the New York Stock Exchange under the
ticker symbol "UDS."

In the merger, each share of Diamond Shamrock Common Stock is being
converted into 1.02 shares of Ultramar Diamond Shamrock Common Stock;
shares of Ultramar Common Stock outstanding prior to the merger remain
outstanding after the merger. Diamond Shamrock 5 percent Convertible
Preferred Stock outstanding prior to the merger is being converted into a
new series of Preferred Stock of Ultramar Diamond Shamrock having identical
terms, except that the conversion ratio is being adjusted to reflect the
Common Stock exchange ratio in the merger.

Ultramar Diamond Shamrock Chairman and Chief Executive Officer Roger
Hemminghaus expressed confidence in the future success of the new
corporation: "Since the Sept. 23 announcement of the merger, the management
of both companies have worked closely together to develop a strategy and
structure an organization that is postured for growth.

"We are focusing on providing an attractive total shareholder return
through operating excellence and strategic expansion. Growth is essential
to the success of the company," Hemminghaus continued. "With its strong
balance sheet and significant management expertise, Ultramar Diamond
Shamrock is positioned to aggressively pursue value-adding, high-return
acquisitions and partnership opportunities in our consolidating industry."





KEY STRATEGIES

Ultramar Diamond Shamrock Vice Chairman, President, and Chief Operating
Officer Jean Gaulin points out that the new corporation's emphasis will be
on its refining and marketing business. "We will continue to strengthen our
core refining and marketing systems. In the Southwest, we expect to be able
to increase sales of both wholesale and retail petroleum products in our
key Arizona markets. Ultramar Diamond Shamrock has a unique strategic
advantage in being able to supply growing Southwest markets from either its
California or Texas refineries," Gaulin explained.

"In Eastern Canada, we plan to continue to strengthen our market position
as we convert more gasoline outlets to company operated stores that will
also market a wide variety of convenience store merchandise and services.
Our objective is to grow both systems smartly, applying technology, and
developing high-return, timely projects."

Gaulin continued, "Ultramar Diamond Shamrock will also continue to leverage
our resources and expertise to profit from related businesses, such as
merchandising of goods and services in our stores, petrochemicals, and our
growing home heating oil business in the Northeast."

Hemminghaus emphasized that a top priority of management will be to achieve
at least $75 million of annual savings that has been projected for the
merger. "As we learn more about each other's operations, we see increased
synergies in areas such as gasoline marketing, purchasing and product
merchandising, crude oil purchasing, and technology application that will
enable us to achieve this goal."

NEW BOARD

Ultramar Diamond Shamrock Corporation Board of Directors will consist of 12
persons, six from each of the two predecessor Boards. Hemminghaus, 60, will
serve as Chairman of the Board, and Gaulin, 54, will be the Vice Chairman.

Others named to the Ultramar Diamond Shamrock Board of Directors are Byron
Allumbaugh, 64, Chairman of the Board of Ralphs Grocery Company; E. Glenn
Biggs, 63, President of Biggs & Co. and former chief executive of the Gill
Companies and other banking institutions; W. E.





Bradford, 61, Chairman and CEO of Dresser Industries; H. Frederick
Christie, 63, retired Chairman and CEO of The Mission Group and past
President of Southern California Edison Company; W. H. Clark, 64, retired
CEO and Chairman of Nalco Chemical Company; Russel H. Herman, 66, owner and
principal of International Energy Consultants and formerly President and
CEO for Exxon's Asia-Pacific area and Executive Vice President for its
European petroleum business; Bob Marbut, 61, Chairman and CEO of Argyle
Communications, Inc. and past President and CEO of Harte-Hanks
Communications; Katherine D. Ortega, 62, former Alternate Representative of
the United States to the United Nations and 38th Treasurer of the United
States; Madeleine Saint-Jacques, 61, Chairman of the Board of Saint-Jacques
Vailee, Young & Rubicam, Inc., Montreal; and C. Barry Schaefer, 57,
Managing Director, The Bridgeford Group and former executive with Dillon
Read & Co. and Union Pacific Corporation.

With estimated revenues of $9 billion and approximately 17,000 employees,
Ultramar Diamond Shamrock Corporation is the fourth largest independent
refining and marketing company in North America. The corporation owns four
modern refineries in Texas, California, and Quebec with a total throughput
capacity of 465,000 barrels per day and has approximately 4,400 retail
gasoline outlets, the majority of which are branded Diamond Shamrock,
Ultramar, or Beacon. The corporation also has growing petrochemicals, home
heating oil, and convenience store merchandising businesses.

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