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Exhibit 10.1

Execution

CREDIT AGREEMENT

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PACIFIC ENERGY GROUP LLC,

as Borrower,

PACIFIC ENERGY PARTNERS, L.P.

as Guarantor,

FLEET NATIONAL BANK,

as Administrative Agent,

U.S. BANK NATIONAL ASSOCIATION,

as Syndication Agent,

FORTIS CAPITAL CORP., and

THE BANK OF NOVA SCOTIA,

as Co-Documentation Agents

FLEET SECURITIES, INC., and

U.S. BANK NATIONAL ASSOCIATION,

as Co-Arrangers and Co-Book Managers,

and CERTAIN FINANCIAL INSTITUTIONS,

as Lenders

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$200,000,000 Revolving Credit Facility
$225,000,000 Term Loan Facility

July 19, 2002

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TABLE OF CONTENTS

ARTICLE I—Definitions and References   5   Section 1.1.   Defined Terms   5  
Section 1.2.   Exhibits and Schedules; Additional Definitions   22   Section
1.3.   Amendment of Defined Instruments   22   Section 1.4.   References and
Titles   22   Section 1.5.   Calculations and Determinations   22   Section 1.6.
  Joint Preparation; Construction of Indemnities and Releases   23
ARTICLE II—The Loans
 
23   Section 2.1.   Commitments to Lend; Notes   23   Section 2.2.   Requests
for New Loans   24   Section 2.3.   Continuations and Conversions of Existing
Loans   24   Section 2.4.   Use of Proceeds   25   Section 2.5.   Optional
Prepayments of Loans; Interest and Premium on Prepayments   26   Section 2.6.  
Mandatory Prepayments   26   Section 2.7.   Letters of Credit   27   Section
2.8.   Requesting Letters of Credit   27   Section 2.9.   Reimbursement and
Participations   28   Section 2.10.   No Duty to Inquire   29   Section 2.11.  
LC Collateral   29   Section 2.12.   Interest Rates and Fees; Reduction in
Commitment   30   Section 2.13.   Repayment of Term Loans   31
ARTICLE III—Payments to Lenders
 
31   Section 3.1.   General Procedures   31   Section 3.2.   Capital
Reimbursement   32   Section 3.3.   Increased Cost of LIBOR Loans or Letters of
Credit   33   Section 3.4.   Notice; Change of Applicable Lending Office   33  
Section 3.5.   Availability   33   Section 3.6.   Funding Losses   34   Section
3.7.   Reimbursable Taxes   34   Section 3.8.   Replacement of Lenders   35
ARTICLE IV—Conditions Precedent to Credit
 
35   Section 4.1.   Documents to be Delivered   35   Section 4.2.   Additional
Conditions Precedent   37
ARTICLE V—Representations and Warranties
 
38   Section 5.1.   No Default   38   Section 5.2.   Organization and Good
Standing   38   Section 5.3.   Authorization   38   Section 5.4.   No Conflicts
or Consents   38   Section 5.5.   Enforceable Obligations   39   Section 5.6.  
Initial Financial Statements   39   Section 5.7.   Other Obligations and
Restrictions   39   Section 5.8.   Full Disclosure   39   Section 5.9.  
Litigation   40   Section 5.10.   Labor Disputes and Acts of God   40   Section
5.11.   ERISA Plans and Liabilities   40   Section 5.12.   Compliance with Laws
  40

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  Section 5.13.   Environmental Laws   41   Section 5.14.   Names and Places of
Business   42   Section 5.15.   Borrower's Subsidiaries   42   Section 5.16.  
Title to Properties; Licenses   42   Section 5.17.   Government Regulation   43
  Section 5.18.   Insider   43   Section 5.19.   Solvency   43
ARTICLE VI—Affirmative Covenants
 
43   Section 6.1.   Payment and Performance   43   Section 6.2.   Books,
Financial Statements and Reports   44   Section 6.3.   Other Information and
Inspections   45   Section 6.4.   Notice of Material Events and Change of
Address   45   Section 6.5.   Maintenance of Properties   45   Section 6.6.  
Maintenance of Existence and Qualifications   45   Section 6.7.   Payment of
Trade Liabilities, Taxes, etc.   46   Section 6.8.   Insurance   46   Section
6.9.   Performance on Borrower's Behalf   46   Section 6.10.   Interest   46  
Section 6.11.   Compliance with Agreements and Law   46   Section 6.12.  
Environmental Matters; Environmental Reviews   47   Section 6.13.   Guaranties
of Subsidiaries   47   Section 6.14.   Regarding the Systems   48   Section
6.15.   Clean Down Period   48   Section 6.16.   Agreement to Deliver Security
Documents   48   Section 6.17.   Subsidiaries; Unrestricted Subsidiaries   49  
Section 6.18.   Designation and Conversion of Restricted and Unrestricted
Subsidiaries   50   Section 6.19.   Change of Name and other Matters   50
ARTICLE VII—Negative Covenants
 
50   Section 7.1.   Indebtedness   51   Section 7.2.   Limitation on Liens   51
  Section 7.3.   Hedging Contracts   52   Section 7.4.   Limitation on Mergers,
Issuances of Securities   53   Section 7.5.   Limitation on Sales of Property  
54   Section 7.6.   Limitation on Dividends, Redemptions and Prepayments   55  
Section 7.7.   Limitation on Investments and New Businesses; Limitation on
Credit Extensions   55   Section 7.8.   Transactions with Affiliates   55  
Section 7.9.   Prohibited Contracts   55   Section 7.10.   Leverage Ratio   56  
Section 7.11.   Interest Coverage Ratio   57   Section 7.12.   Debt to Capital
Ratio   57   Section 7.13.   Open Position; Trading   57   Section 7.14.  
Operating Agreements   57
ARTICLE VIII—Events of Default and Remedies
 
58   Section 8.1.   Events of Default   58   Section 8.2.   Remedies   59  
Section 8.3.   Application of Proceeds after Acceleration   60
ARTICLE IX—Administrative Agent
 
60   Section 9.1.   Appointment and Authority   60

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  Section 9.2.   Exculpation, Administrative Agent's Reliance, Etc.   60  
Section 9.3.   Credit Decisions   61   Section 9.4.   Indemnification   61  
Section 9.5.   Rights as Lender   62   Section 9.6.   Sharing of Set-Offs and
Other Payments   62   Section 9.7.   Investments   62   Section 9.8.   Benefit
of Article IX   62   Section 9.9.   Resignation   62   Section 9.10.   Other
Agents   63
ARTICLE X—Miscellaneous
 
63   Section 10.1.   Amendment and Consents   63   Section 10.2.   Survival of
Agreements; Cumulative Nature   64   Section 10.3.   Notices   65   Section
10.4.   Payment of Expenses; Indemnity   65   Section 10.5.   Joint and Several
Liability; Parties in Interest; Assignments; Replacement Notes   66   Section
10.6.   Confidentiality   68   Section 10.7.   Bank Accounts; Offset   69  
Section 10.8.   Governing Law; Submission to Process   69   Section 10.9.  
Limitation on Interest   70   Section 10.10.   Termination; Limited Survival  
70   Section 10.11.   Foreign Lenders   71   Section 10.12.   No General
Partner's Liability   71   Section 10.13.   Severability   72   Section 10.14.  
Counterparts   72   Section 10.15.   Waiver of Jury Trial, Punitive Damages,
etc.   72   Section 10.16.   Waiver/Acknowledgments   72   Section 10.17.  
Restatement   73

Schedules and Exhibits:

Schedule 1—Lender Schedule
Schedule 2—Disclosure Schedule
Schedule 3—Security Schedule

Exhibit A-1—Revolver Promissory Note
Exhibit A-2—Term Promissory Note
Exhibit B—Borrowing Notice
Exhibit C—Continuation/Conversion Notice
Exhibit D—Certificate Accompanying Financial Statements
Exhibit E—Assignment and Acceptance Agreement

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CREDIT AGREEMENT

        THIS CREDIT AGREEMENT is made as of July 19, 2002, by and among PACIFIC
ENERGY GROUP LLC ("Borrower"), a Delaware limited liability company, PACIFIC
ENERGY PARTNERS, L.P. ("Pacific Energy Partners"), a Delaware limited
partnership, and FLEET NATIONAL BANK, as administrative agent (in such capacity,
"Administrative Agent"), U.S. BANK NATIONAL ASSOCIATION, as syndication agent
(in such capacity, "Syndication Agent"), FORTIS CAPITAL CORP. and THE BANK OF
NOVA SCOTIA, as co-documentation agents (in such capacity, "Co-Documentation
Agents"), FLEET SECURITIES, INC. and U.S. BANK NATIONAL ASSOCIATION, as
co-arrangers and co-book managers (in such capacity, "Arrangers") and the
Lenders referred to below.

W I T N E S S E T H:

        In consideration of the mutual covenants and agreements contained herein
and in consideration of the loans which may hereafter be made by Lenders to, and
the Letters of Credit that may hereafter be issued by the LC Issuer for the
account of, Borrower, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto do hereby
agree as follows:

ARTICLE I—Definitions and References

        Section 1.1.    Defined Terms.    As used in this Agreement, each of the
following terms has the meaning given to such term in this Section 1.1 or in the
sections and subsections referred to below:

        "Administrative Agent" means Fleet National Bank, as Administrative
Agent hereunder, and its successors in such capacity.

        "Affiliate" means, as to any Person, each other Person that directly or
indirectly (through one or more intermediaries or otherwise) controls, is
controlled by, or is under common control with, such Person. A Person shall be
deemed to be "controlled by" any other Person if such other Person possesses,
directly or indirectly, power

        (a)  to vote 20% or more of the securities (on a fully diluted basis)
having ordinary voting power for the election of directors or managing general
partners; or

        (b)  to direct or cause the direction of the management and policies of
such Person whether by contract or otherwise.

        "Agreement" means this Credit Agreement.

        "Applicable Lending Office" means, with respect to each Lender, such
Lender's Domestic Lending Office in the case of Base Rate Loans and such
Lender's LIBOR Lending Office in the case of LIBOR Loans.

        "Applicable Rating Level" means for any day, the level set forth below
that corresponds to the less favorable Borrower Debt Rating applicable on such
day. As used in this definition, "c" means a rating equal to or more favorable
than and "a" means a rating equal to or less favorable than.

Applicable
Rating Level

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  S&P

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  Moody's

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Level I   cBBB   cBaa2 Level II   BBB-   Baa3 Level III   BB+   Ba1 Level IV  
BB   Ba2 Level V   aBB-   aBa3

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If either of the Rating Agencies shall not have in effect a Borrower Debt Rating
or if the rating system of either of the Rating Agencies shall change, or if
either of the Rating Agencies shall cease to be in the business of rating
corporate debt obligations, Borrower and Majority Lenders shall negotiate in
good faith to amend this definition to reflect such changed rating system or the
unavailability of ratings from such Rating Agency, but until such an agreement
shall be reached, the Applicable Rating Level shall be based only upon the
Borrower Debt Rating by the remaining Rating Agency.

        "Available Cash" means the amount of "Available Cash" determined from
time to time pursuant to the provision of the Partnership Agreement; provided,
however, only the Working Capital Amount and Working Capital Loans may be used
to fund distributions pursuant to the Partnership Agreement or to satisfy any
requirements for reserves in determining Available Cash pursuant to the
Partnership Agreement.

        "Base Rate" means the higher of (a) the variable per annum rate of
interest so designated from time to time by Administrative Agent as its "prime
rate", or (b) the Federal Funds Rate plus one-half percent (0.5%) per annum. The
"prime rate" is a reference rate and does not necessarily represent the lowest
or best rate being charged to any customer. Changes in the Base Rate resulting
from changes in the "prime rate" shall take place immediately without notice or
demand of any kind.

        "Base Rate Loan" means a Loan which does not bear interest at the LIBOR
Rate.

        "Base Rate Margin" means, on any date, the percent per annum set forth
below based on the Applicable Rating Level in effect on such date; provided,
however, during the EPTC Acquisition Period, the rate that would otherwise be
the applicable Base Rate Margin for Revolver Loans set forth below shall be
increased by .375% for Level I or Level II, by .50% for Level III or Level IV,
and by .625% for Level V and the applicable Base Rate Margin for Term Loans set
forth below shall be increased by .50% for each Applicable Rating Level set
forth below.

 
  Base Rate Margin

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  Applicable Rating Level

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  Revolver Loans

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  Term Loans

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  Level I   0.00 % .50 % Level II   0.00 % .50 % Level III   0.00 % .75 % Level
IV   .25 % .75 % Level V   .50 % .75 %

Changes in the applicable Base Rate Margin will occur automatically, without
prior notice as changes in the Applicable Rating Level occur. Administrative
Agent will give notice promptly to Borrower and Lenders of changes in the
applicable Base Rate Margin.

        "Borrower" means Pacific Energy Group LLC, a Delaware limited liability
company.

        "Borrower Debt Rating" means the rating then in effect by a Rating
Agency with respect to the Obligations of Borrower hereunder or, at any time
such rating is not maintained, the Debt Rating with respect to long term senior
unsecured non-credit enhanced debt of Borrower.

        "Borrowing" means (i) a borrowing of new Loans of a single Type pursuant
to Section 2.2 or (ii) a Continuation or Conversion of all or a portion of an
existing Revolver Loan (whether alone or as a combination with a new Revolver
Loan) or all or a portion of an existing Term Loan into a single Type (and, in
the case of LIBOR Loans, with the same Interest Period) pursuant to Section 2.3.

        "Borrowing Notice" means a written or telephonic request, or a written
confirmation, made by Borrower which meets the requirements of Section 2.2.

        "Business Day" means any day, other than a Saturday, Sunday or day which
shall be in the Commonwealth of Massachusetts, State of California, or State of
New York a legal holiday or day on

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which banking institutions are required or authorized to close. Any Business Day
in any way relating to LIBOR Loans (such as the day on which an Interest Period
begins or ends) must also be a day on which commercial banks settle payments in
London.

        "Capital Lease" means a lease with respect to which the lessee is
required concurrently to recognize the acquisition of an asset and the
incurrence of a liability in accordance with GAAP.

        "Cash Equivalents" means Investments in:

        (a)  marketable obligations, maturing within 12 months after acquisition
thereof, issued or unconditionally guaranteed by the United States of America or
an instrumentality or agency thereof and entitled to the full faith and credit
of the United States of America;

        (b)  demand deposits and time deposits (including certificates of
deposit) maturing within 12 months from the date of deposit thereof, (i) with
any office of any Lender or (ii) with a domestic office of any national or state
bank or trust company which is organized under the Laws of the United States of
America or any state therein, which has capital, surplus and undivided profits
of at least $500,000,000, and whose long-term certificates of deposit are rated
at least Aa3 by Moody's or AA- by S&P;

        (c)  repurchase obligations with a term of not more than seven days for
underlying securities of the types described in subsection (a) above entered
into with (i) any Lender or (ii) any other commercial bank meeting the
specifications of subsection (b) above;

        (d)  open market commercial paper, maturing within 270 days after
acquisition thereof, which are rated at least P-1 by Moody's or A-1 by S&P; and

        (e)  money market or other mutual funds substantially all of whose
assets comprise securities of the types described in subsections (a) through
(d) above.

        "Change of Control" means the occurrence of any of the following events:
(a) both (i) the Anschutz Group shall be the legal or beneficial owner (within
the meaning of Rule 13d-3 under the Securities Exchange Act of 1934, as amended)
of 331/3% or less of the combined voting power of the then total partnership
interests (including all securities which are convertible into partnership
interests) of Pacific Energy Partners and (ii) any Person or group of Persons
acting in concert as a partnership or other group (a "Group of Persons"), other
than one or more of the Anschutz Group, shall be the legal or beneficial owner
(within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934, as
amended) of more than 35% of the combined voting power of the then total
partnership interests (including all securities which are convertible into
partnership interests) of Pacific Energy Partners, or (b) Pacific Energy
Partners shall not be the sole legal and beneficial owner (as defined above) of
all of the limited liability company interests of Borrower (including all
securities which are convertible into limited partner interests), or (c) the
General Partner shall cease to be the sole general partner of Pacific Energy
Partners, or (d) the Anschutz Group shall not collectively own, directly or
indirectly, a majority of the combined voting power of the Equity Interests in
the General Partner. "Anschutz Group" means any one or more of Philip F.
Anschutz, his spouse or descendants or The Anschutz Foundation, trusts or
estates whose primary beneficiaries include one or more of the foregoing, and
any corporation, partnership or company a majority of the securities (on a fully
diluted basis) having ordinary voting power for the election of directors,
managers, managing members or managing general partners of which are legally and
beneficially owned, directly or indirectly, by one or more of the foregoing

        "Citibank Credit Agreement" means that certain Credit Agreement dated as
of August 9, 2000, by and between Pacific Pipeline System LLC, as Borrower, and
Citibank, N.A., as Administrative Agent and Lender, as amended, modified or
supplemented from time to time.

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        "Closing Date" means the date on which all of the conditions precedent
set forth in Section 4.1 shall have been satisfied or waived.

        "Code" means the Internal Revenue Code of 1986, as amended from time to
time, together with all rules and regulations promulgated with respect thereto.

        "Collateral" means all property of any kind which is subject to a Lien
in favor of Lenders (or in favor of Administrative Agent for the benefit of
Lenders) or which, under the terms of any Security Document, is purported to be
subject to such a Lien.

        "Commitment Fee Rate" means, on any date, the rate per annum set forth
below based on the Applicable Rating Level on such date.

Applicable Rating Level

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  Commitment Fee Rate

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  Level I, Level II or Level III   .25 % Level IV   .375 % Level V   .50 %

Changes in the applicable Commitment Fee Rate will occur automatically, without
prior notice as changes in the Applicable Rating Level occur. Administrative
Agent will give notice promptly to Borrower and Lenders of changes in the
Commitment Fee Rate.

        "Commitment Period" means the period from and including the Closing Date
until July 26, 2007 (or, if earlier, the day on which (i) the obligation of
Lenders to make Loans hereunder and the obligations of LC Issuer to issue
Letters of Credit hereunder have terminated, or (ii) the Notes first become due
and payable in full, whichever shall first occur).

        "Consolidated" refers to the consolidation of any Person, in accordance
with GAAP, with its properly consolidated Subsidiaries. References herein to a
Person's Consolidated financial statements, financial position, financial
condition, liabilities, etc. refer to the consolidated financial statements,
financial position, financial condition, liabilities, etc. of such Person and
its properly consolidated Subsidiaries.

        "Consolidated EBITDA" means, for any period, the sum of (1) the
Consolidated Net Income during such period, plus (2) all interest expense which
was deducted in determining such Consolidated Net Income for such period, plus
(3) all income taxes (including any franchise taxes to the extent based upon net
income) which were deducted in determining such Consolidated Net Income, plus
(4) all depreciation, amortization (including amortization of good will and debt
issue costs) and other non-cash charges (including any provision for the
reduction in the carrying value of assets recorded in accordance with GAAP, but
excluding any non-cash charges that constitute accrual of or reserve for future
cash payments) which were deducted in determining such Consolidated Net Income,
plus (5) cash dividends or distributions from Unrestricted Subsidiaries and from
any equity method investments, minus (6) all non-cash items of income which were
included in determining such Consolidated Net Income. Consolidated EBITDA shall
not include (i) any gain in excess of $1,000,000 in any Fiscal Year (to the
extent of such excess) from the sale of assets or any loss from the sale of
assets, (ii) any extraordinary gains or losses or (iii) any non-cash gains or
losses resulting from mark to market activity as a result of SFAS 133.

        "Consolidated Funded Indebtedness" means, as of any date, the sum of the
following (without duplication): (i) all Indebtedness which is classified as
"long-term indebtedness" on a Consolidated balance sheet of Pacific Energy
Partners and its Consolidated Subsidiaries prepared as of such date in
accordance with GAAP and any current maturities and other principal amount in
respect of such Indebtedness due within one year but which was classified as
"long-term indebtedness" at the creation thereof, (ii) Indebtedness for borrowed
money of Pacific Energy Partners and its Consolidated Subsidiaries outstanding
under a revolving credit or similar agreement providing for borrowings (and

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renewals and extensions thereof) over a period of more than one year,
notwithstanding the fact that any such borrowing is made within one year of the
expiration of such agreement, and (iii) Indebtedness in respect of Capital
Leases of Pacific Energy Partners and its Consolidated Subsidiaries; provided,
however there shall not be included in Consolidated Funded Indebtedness (a) the
Indebtedness of a Restricted Person in respect of undrawn amounts that may be
drawn under Letters of Credit, (b) Indebtedness of Unrestricted Subsidiaries and
(c) obligations arising out of Hedging Contracts.

        "Consolidated Interest Expense" means, for any applicable period,
without duplication, the sum of (i) the interest expense of Pacific Energy
Partners and its Subsidiaries accrued during such period, and whether expensed
in such period or capitalized, as determined on a Consolidated basis, including
without limitation (a) any amortization of debt discount, (b) the net cost under
interest rate Hedging Agreements, (c) the interest portion of any deferred
payment obligation, (d) all commissions, discounts and other fees and charges
owed with respect to letters of credit and bankers' acceptance financing and
(e) all accrued interest, and (ii) the interest component in respect of
obligations under Capital Leases paid, accrued or scheduled to be paid or
accrued by Pacific Energy Partners and its Subsidiaries during such period in
accordance with GAAP; provided, however, there shall be excluded from
Consolidated Interest Expense, the interest expense of Unrestricted
Subsidiaries.

        "Consolidated Net Income" means, for any period, Pacific Energy
Partners' and its Subsidiaries' gross revenues for such period, minus Pacific
Energy Partners' and its Subsidiaries' expenses and other proper charges against
income (including taxes on income to the extent imposed), determined in
accordance with GAAP on a Consolidated basis after eliminating earnings and
losses attributable to outstanding minority interests (other than the minority
interest in Borrower held by the General Partner); provided, however,
Consolidated Net Income shall exclude the net earnings of any Unrestricted
Subsidiary or equity method investments.

        "Consolidated Net Worth" means all Consolidated assets, as determined in
accordance with GAAP, of Pacific Energy Partners and its Subsidiaries (excluding
Unrestricted Subsidiaries) minus the sum of (a) Consolidated liabilities, as
determined in accordance with GAAP of Pacific Energy Partners and its
Subsidiaries (excluding Unrestricted Subsidiaries), and (b) all outstanding
Minority Interests (other than the minority interest in Borrower held by the
General Partner). The effect of any increase or decrease in net worth in any
period as a result of items of income or loss not reflected in the determination
of net income but reflected in the determination of comprehensive income (to the
extent provided under GAAP as in effect on the date hereof) shall be excluded in
determining Consolidated Net Worth. "Minority Interests" means the book value of
any Equity Interests in any of Pacific Energy Partners' Subsidiaries (excluding
Unrestricted Subsidiaries) which Equity Interests are owned by a Person other
than Pacific Energy Partners or a Wholly Owned Subsidiary of Pacific Energy
Partners.

        "Continuation/Conversion Notice" means a written or telephonic request,
or a written confirmation, made by Borrower which meets the requirements of
Section 2.3.

        "Continue", "Continuation", and "Continued" shall refer to the
continuation pursuant to Section 2.3 hereof of a LIBOR Loan as a LIBOR Loan from
one Interest Period to the next Interest Period.

        "Convert", "Conversion", and "Converted" shall refer to a conversion
pursuant to Section 2.3 or Article III of one Type of Loan into another Type of
Loan.

        "Debt Rating" means with respect to a Person, the rating then in effect
by a Rating Agency for the long term senior unsecured non-credit enhanced debt
of such Person.

        "Default" means any Event of Default and any default, event or condition
which would, with the giving of any requisite notices and the passage of any
requisite periods of time, constitute an Event of Default.

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        "Default Rate" means, at the time in question, (i) two percent (2%) per
annum plus the applicable LIBOR Rate Margin plus the LIBOR Rate then in effect
for any LIBOR Loan (up to the end of the applicable Interest Period) or (ii) two
percent (2%) per annum plus the applicable Base Rate Margin plus the Base Rate
for each Base Rate Loan; provided, however, the Default Rate shall never exceed
the Highest Lawful Rate.

        "Default Rate Period" means (i) any period during which an Event of
Default, other than pursuant to Section 8.1 (a) or (b), or with respect to
Borrower, Section 8.1(h)(i), (h)(ii) or (h)(iii), is continuing, provided that
such period shall not begin until notice of the commencement of the Default Rate
has been given to Borrower by Administrative Agent upon the instruction by
Majority Lenders and (ii) any period during which any Event of Default pursuant
to Section 8.1 (a) or (b), or with respect to Borrower, Section 8.1(h)(i),
(h)(ii) or (h)(iii), is continuing unless Borrower has been notified otherwise
by Administrative Agent upon the instruction by Majority Lenders.

        "Disclosure Schedule" means Schedule 2 hereto.

        "Dollars" and "$" means the lawful currency of the United States of
America, except where otherwise specified.

        "Domestic Lending Office" means, with respect to any Lender, the office
of such Lender specified as its "Domestic Lending Office" in the Lender Schedule
hereto, or such other office as such Lender may from time to time specify to
Borrower and Administrative Agent; with respect to LC Issuer, the office,
branch, or agency through which it issues Letters of Credit; and, with respect
to Administrative Agent, the office, branch, or agency through which it
administers this Agreement.

        "Eligible Transferee" means a Person which either (a) is a Lender or an
Affiliate of a Lender, or (b) is consented to as an Eligible Transferee by
Administrative Agent and, so long as no Default or Event of Default is
continuing, by Borrower, which consents in each case will not be unreasonably
withheld (provided that no Person organized outside the United States may be an
Eligible Transferee if Borrower would be required to pay withholding taxes on
interest or principal owed to such Person).

        "Environmental Laws" means any and all Laws relating to the environment
or to emissions, discharges, releases or threatened releases of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances or wastes
into the environment including ambient air, surface water, ground water, or
land, or otherwise relating to the manufacture, processing, distribution use,
treatment, storage, disposal, transport, or handling of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances or wastes.

        "EPTC Acquisition" means the acquisition by a Subsidiary of Borrower of
the terminal and pipeline assets of Edison Pipeline and Terminal Company, a
division of Southern California Edison Company substantially as contemplated by
the EPTC Acquisition Documents.

        "EPTC Acquisition Documents" means the Asset Sale Agreement dated as of
February 1, 2002, between Southern California Edison Company, as seller, and PPS
Holding Company, as buyer, and all other agreements or instruments executed and
delivered in connection therewith.

        "EPTC Acquisition Period" means the period beginning with the funding of
the purchase price for the EPTC Acquisition and ending on the earlier of
(a) 270 days after the commencement of such period and (b) the receipt of
proceeds of an equity offering by Pacific Energy Partners after the commencement
of such period in an amount sufficient to cause Borrower to be in compliance
with Section 7.10(ii) as of the date of the receipt of such proceeds; provided,
however, no EPTC Acquisition Period shall be deemed to have commenced if Pacific
Energy Partners shall have consummated an equity offering for cash after the
initial public offering contemplated by Section 4.1(o) but prior to such funding
of the purchase price for the EPTC Acquisition, and Borrower shall be in
compliance with Section 7.10(ii) as of the date of such funding of such purchase
price.

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        "Equity Interest" means any capital stock, partnership interest or
member interest in a Person or any other equity interest in a Person.

        "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, together with all rules and regulations promulgated
with respect thereto.

        "ERISA Affiliate" means each Related Person and all members of a
controlled group of corporations and all trades or businesses (whether or not
incorporated) under common control that, together with such Related Person, are
treated as a single employer under Section 414 of the Code.

        "ERISA Plan" means any employee pension benefit plan subject to Title IV
of ERISA maintained by any ERISA Affiliate with respect to which any Related
Person has a fixed or contingent liability.

        "Event of Default" has the meaning given to such term in Section 8.1.

        "Excess Sale Proceeds" shall have the meaning set forth in Section 7.5.

        "Existing Credit Agreements" means (i) that certain Demand Promissory
Note dated as of December 17, 2001, in the original principal amount of
$4,933,000, issued by Ranch Pipeline, Inc. in favor of Anschutz Family
Investment Company, LLC, and (ii) that certain Demand Promissory Note dated as
of March 1, 2002, in the original principal amount of $12,000,000, issued by
Rocky Mountain Pipeline System LLC in favor of Ranch Pipeline System LLC.

        "Existing US Bank Agreement" means that certain Credit Agreement dated
as of March 1, 2002, by and among Rocky Mountain Pipeline System LLC and Ranch
Pipeline LLC, as Borrowers, and U.S. Bank National Association, as
administrative agent and Lender.

        "Federal Funds Rate" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/1000th of one percent) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day, provided that (i) if the day for which such rate is to
be determined is not a Business Day, the Federal Funds Rate for such day shall
be such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (ii) if such rate is not so
published for any day, the Federal Funds Rate for such day shall be the average
rate quoted to Administrative Agent on such day on such transactions as
determined by Administrative Agent.

        "Fiscal Quarter" means a three-month period ending on March 31, June 30,
September 30 or December 31 of any year.

        "Fiscal Year" means a twelve-month period ending on December 31 of any
year.

        "Foreign Lender" shall have the meaning given that term in
Section 10.11.

        "GAAP" means those generally accepted accounting principles and
practices which are recognized as such by the Financial Accounting Standards
Board (or any generally recognized successor) and which, in the case of Pacific
Energy Partners and its Consolidated Subsidiaries, are applied for all periods
after the date hereof in a manner consistent with the manner in which such
principles and practices were applied to the Initial Financial Statements. If
any change in any accounting principle or practice is required by the Financial
Accounting Standards Board (or any such successor) in order for such principle
or practice to continue as a generally accepted accounting principle or
practice, all reports and financial statements required hereunder with respect
to Pacific Energy Partners or with respect to Pacific Energy Partners and its
Consolidated Subsidiaries may be prepared in accordance with such change, but
all calculations and determinations to be made hereunder may be made in
accordance with such change only after notice of such change is given to each
Lender, and Majority Lenders agree to such change in such calculations and
determinations.

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        "General Partner" means Pacific Energy GP, Inc., a Delaware corporation.

        "Guarantors" means Pacific Energy Partners and each Subsidiary of
Borrower or Pacific Energy Partners (other than Borrower) which now or hereafter
executes and delivers a Guaranty to Administrative Agent pursuant to
Section 6.13 or who has a valid and outstanding debt obligation pledged to
Administrative Agent complying with the requirements of Section 6.13(c).

        "Guaranty" means a guaranty now or hereafter made by any Guarantor in
favor of the Administrative Agent on behalf of the Lenders, as provided in
Section 6.13, which Guaranty shall be in form as shall be reasonably
satisfactory to Administrative Agent, as the same may be amended, supplemented
or restated from time to time.

        "Guaranty Obligation" means, as to any Person, (a) any obligation,
contingent or otherwise, of such Person guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other payment obligation of another
Person (the "primary obligor") in any manner, whether directly or indirectly,
and including any obligation of such Person, direct or indirect, (i) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other payment obligation, (ii) to purchase or lease property,
securities or services for the purpose of assuring the obligee in respect of
such Indebtedness or other payment obligation of the payment of such
Indebtedness or other payment obligation, (iii) to maintain working capital,
equity capital or any other financial statement condition or liquidity of the
primary obligor so as to enable the primary obligor to pay such Indebtedness or
other payment obligation, or (iv) entered into for the purpose of assuring in
any other manner the obligees in respect of such Indebtedness or other payment
obligation of the payment thereof or to protect such obligees against loss in
respect thereof (in whole or in part), or (b) any Lien on any assets of such
Person securing any Indebtedness or other payment obligation of any other
Person, whether or not such Indebtedness or other payment obligation is assumed
by such Person; provided, however, that the term "Guaranty Obligation" shall not
include endorsements of instruments for deposit or collection in the ordinary
course of business. The amount of any Guaranty Obligation shall be deemed to be
the lesser of (a) an amount equal to the stated or determinable outstanding
amount of the related primary obligation and (b) the maximum amount for which
such guarantying Person may be liable pursuant to the terms of the instrument
embodying such Guaranty Obligation, unless the outstanding amount of such
primary obligation and the maximum amount for which such guarantying Person may
be liable are not stated or determinable, in which case the amount of such
Guaranty Obligation shall be the maximum reasonably anticipated liability in
respect thereof as determined by the guarantying Person in good faith.

        "Hazardous Materials" means any substances regulated under any
Environmental Law, whether as pollutants, contaminants, or chemicals, or as
industrial, toxic or hazardous substances or wastes, or otherwise.

        "Hedging Contract" means (a) any agreement providing for options, swaps,
floors, caps, collars, forward sales or forward purchases involving interest
rates, commodities or commodity prices, equities, currencies, bonds, or indexes
based on any of the foregoing, (b) any option, futures or forward contract
traded on an exchange, and (c) any other derivative agreement or other similar
agreement or arrangement.

        "Highest Lawful Rate" means, with respect to each Lender Party to whom
Obligations are owed, the maximum nonusurious rate of interest that such Lender
Party is permitted under applicable Law to contract for, take, charge, or
receive with respect to such Obligations. All determinations herein of the
Highest Lawful Rate, or of any interest rate determined by reference to the
Highest Lawful Rate, shall be made separately for each Lender Party as
appropriate to assure that the Loan Documents are not construed to obligate any
Person to pay interest to any Lender Party at a rate in excess of the Highest
Lawful Rate applicable to such Lender Party.

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        "Indebtedness" means, as to any Person at a particular time, all of the
following:

        (a)  all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes, loan
agreements or other similar instruments;

        (b)  the face amount of all letters of credit (including standby and
commercial), banker's acceptances, letters of guaranty, and similar instruments
issued for the account of such Person, and, without duplication, all drafts
drawn and unpaid thereunder;

        (c)  whether or not so included as liabilities in accordance with GAAP,
all obligations of such Person to pay the deferred purchase price of property or
services, other than trade accounts payable in the ordinary course of business
not outstanding more than 120 days after the date the respective goods are
delivered or the respective services are rendered, other than obligations
contested in good faith by appropriate proceedings, if required, and for which
adequate reserves are maintained on the books of such Person in accordance with
GAAP, and indebtedness (excluding prepaid interest thereon) secured by a Lien on
property owned or being purchased by such Person (including indebtedness arising
under conditional sales or other title retention agreements), whether or not
such indebtedness shall have been assumed by such Person or is limited in
recourse;

        (d)  obligations arising out of Hedging Contracts (on a net basis to the
extent netting is provided for in the applicable Hedging Contract);

        (e)  Capital Leases; and

        (e)  all Guaranty Obligations of such Person in respect of any of the
foregoing.

For all purposes hereof, the Indebtedness of any Person shall include the
Indebtedness of any partnership or joint venture in which such Person is a
general partner, unless such Indebtedness is expressly made non-recourse to such
Person except for customary exceptions acceptable to the Majority Lenders. The
amount of any Capital Lease as of any date shall be deemed to be the capitalized
amount thereof that would appear on a balance sheet of such Person prepared as
of such date in accordance with GAAP.

        "Initial Financial Statements" means (i) the audited combined balance
sheets of Pacific Energy (Predecessor) as of December 31, 2000 and 2001, and the
related combined statements of operations and net parent investment and cash
flows for each of the years in the three (3) year period ended December 31,
2001, as contained in the Pacific Energy Partners Registration Statement,
(ii) the unaudited balance sheet and income statement of Pacific Energy Partners
and General Partner as of March 31, 2002, as contained in the Pacific Energy
Partners Registration Statement, and (iii) the pro forma Consolidated and
consolidating balance sheet of Pacific Energy Partners and its Subsidiaries as
of May 31, 2002, reflecting on a pro forma basis the consummation of the
transactions contemplated by Section 4.1(o).

        "Interest Period" means, with respect to each particular LIBOR Loan in a
Borrowing, the period specified in the Borrowing Notice or
Continuation/Conversion Notice applicable thereto, beginning on and including
the date specified in such Borrowing Notice or Continuation/Conversion Notice
(which must be a Business Day), and ending one, two, three or, if available to
each Lender, six months thereafter, as Borrower may elect in such notice;
provided that: (a) any Interest Period which would otherwise end on a day which
is not a Business Day shall be extended to the next succeeding Business Day
unless such Business Day falls in another calendar month, in which case such
Interest Period shall end on the next preceding Business Day; (b) any Interest
Period which begins on the last Business Day in a calendar month (or on a day
for which there is no numerically corresponding day in the calendar month at the
end of such Interest Period) shall end on the last Business Day in a calendar
month; and

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(c) notwithstanding the foregoing, no Interest Period may be selected that would
end after the last day of the Commitment Period.

        "Investment" means any investment made, directly or indirectly in any
Person, whether by acquisition of shares of capital stock, indebtedness or other
obligations or securities or by loan, advance, capital contribution or otherwise
and whether made in cash, by the transfer of property or by any other means.

        "Law" means any statute, law, regulation, ordinance, rule, treaty,
judgment, order, decree, permit, concession, franchise, license, agreement or
other governmental restriction of the United States or any state or political
subdivision thereof or of any foreign country or any department, state, province
or other political subdivision thereof.

        "LC Application" means any application for a Letter of Credit hereafter
made by Borrower to LC Issuer.

        "LC Collateral" has the meaning given to such term in Section 2.11(a).

        "LC Issuer" means Fleet National Bank, in its capacity as the issuer of
Letters of Credit hereunder, and its successors in such capacity. Administrative
Agent may, with the consent of Borrower and the Lender in question, appoint any
Lender hereunder as an LC Issuer in place of or in addition to Fleet National
Bank.

        "LC Obligations" means, at the time in question, the sum of all Matured
LC Obligations plus the maximum amounts which LC Issuer might then or thereafter
be called upon to advance under all Letters of Credit then outstanding.

        "Lender Hedging Obligations" means all obligations arising from time to
time under Hedging Contracts entered into from time to time between Borrower,
Pacific Energy Partners or any other Guarantor and a counterparty that is a
Lender or an Affiliate of a Lender; provided that if such counterparty ceases to
be a Lender hereunder or an Affiliate of a Lender hereunder, Lender Hedging
Obligations shall only include such obligations to the extent arising from
transactions entered into at the time such counterparty was a Lender hereunder
or an Affiliate of a Lender hereunder.

        "Lender Parties" means Administrative Agent, LC Issuer, and all Lenders.

        "Lender Schedule" means Schedule 1 hereto, as revised from time to time
by Administrative Agent pursuant to Section 10.5.

        "Lenders" means each signatory hereto (other than Borrower and any
Restricted Person that is a party hereto), including Fleet National Bank, in its
capacity as a Lender hereunder rather than as Administrative Agent and LC
Issuer, and the successors and each permitted assign of each such party as
holder of a Note.

        "Letter of Credit" means any letter of credit issued by LC Issuer
hereunder.

        "Letter of Credit Fee Rate" means, on any day, the rate per annum set
forth below based on the Applicable Rating Level on such date; provided,
however, during the EPTC Acquisition Period, the

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rate that would otherwise be the Letter of Credit Fee Rate set forth below shall
be increased by .375% for Level I or Level II, by .50% for Level III or Level
IV, and by .625% for Level V.

Applicable Rating Level

--------------------------------------------------------------------------------

  Letter of Credit
Fee Rate

--------------------------------------------------------------------------------

  Level I   1.25 % Level II   1.50 % Level III   2.00 % Level IV   2.25 % Level
V   2.50 %

Changes in the applicable Letter of Credit Fee Rate will occur automatically,
without prior notice as changes in the Applicable Rating Level occur.
Administrative Agent will give notice promptly to Borrower and Revolver Lenders
of changes in the Letter of Credit Fee Rate.

        "Liabilities" means, as to any Person, all indebtedness, liabilities and
obligations of such Person, whether matured or unmatured, liquidated or
unliquidated, primary or secondary, direct or indirect, absolute, fixed or
contingent, and whether or not required to be considered pursuant to GAAP.

        "LIBOR Lending Office" means, with respect to any Lender, the office of
such Lender specified as its "LIBOR Lending Office" on the Lender Schedule
hereto (or, if no such office is specified, its Domestic Lending Office), or
such other office of such Lender as such Lender may from time to time specify to
Borrower and Administrative Agent.

        "LIBOR Loan" means a Loan that bears interest at a rate based upon the
LIBOR Rate.

        "LIBOR Rate" means, as applicable to any LIBOR Loan within a Borrowing
and with respect to the related Interest Period therefor, the rate per annum
(rounded upwards, if necessary, to the nearest 1/1000 of 1%) as determined on
the basis of offered rates for deposits in U.S. dollars, for a period of time
comparable to such Interest Period which appears on Telerate Page 3750 (or any
successor page) as of 11:00 a.m. London time on the day that is two Business
Days preceding the first day of such LIBOR Loan; provided, however, if the rate
described above does not appear on the Telerate system on any applicable
interest determination date, the LIBOR Rate shall be the rate (rounded upwards
as described above, if necessary) for deposits in dollars for a period
substantially equal to such Interest Period on the Reuters Page "LIBO" (or such
other page as may replace the LIBO Page on that service for the purpose of
displaying such rates), as of 11:00 a.m. (London time), on the date that is two
Business Days prior to the beginning of such Interest Period; provided, however,
if more than one rate is specified on Reuters Screen LIBO Page, the applicable
rate shall be the arithmetic mean of all such rates (rounded upwards, if
necessary, to the nearest 1/1000 of 1%). If both the Telerate and Reuters system
are unavailable, then the LIBOR Rate for that date will be determined on the
basis of the offered rates for deposits in U.S. dollars for a period of time
comparable to such Interest Period which are offered by four major banks in the
London interbank market at approximately 11:00 a.m. London time, on the day that
is two (2) Business Days preceding the first day of such LIBOR Loan as selected
by Administrative Agent. The principal London office of each of the four major
London banks will be requested to provide a quotation of its U.S. dollar deposit
offered rate. If at least two such quotations are provided, the rate for that
date will be the arithmetic mean of the quotations. If fewer than two quotations
are provided as requested, the rate for that date will be determined on the
basis of the rates quoted for loans in U.S. dollars to leading European banks
for a period of time comparable to such Interest Period offered by major banks
in New York City at approximately 11:00 a.m. New York City time, on the day that
is two Business Days preceding the first day of such LIBOR Loan. In the event
that Administrative Agent is unable to obtain any such quotation as provided
above, it will be deemed that the LIBOR Rate pursuant to such LIBOR Loan cannot
be determined. In the event that the Board of Governors of the Federal Reserve
System shall impose a Reserve Percentage with respect to LIBOR deposits of any
Lender, then for any period during which such Reserve Percentage shall apply,

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the LIBOR Rate shall be equal to the amount determined above divided by an
amount equal to 1 minus the Reserve Percentage. "Reserve Percentage" means the
maximum aggregate reserve requirement (including all basic, supplemental,
marginal, special, emergency and other reserves) which is imposed on member
banks of the Federal Reserve System against "Euro-currency Liabilities" as
defined in Regulation D. Without limiting the effect of the foregoing, the
Reserve Percentage shall reflect any other reserves required to be maintained by
such member banks with respect to (a) any category of liabilities which includes
deposits by reference to which the LIBOR Rate is to be determined, or (b) any
category of extensions of credit or other assets which include LIBOR Loans. The
LIBOR Rate for any LIBOR Loan shall change whenever the Reserve Percentage
changes.

        "LIBOR Rate Margin" means, on any date, the percent per annum set forth
below based on the Applicable Rating Level in effect on such date; provided,
however, during the EPTC Acquisition Period, the rate that would otherwise be
the applicable LIBOR Rate Margin for Revolver Loans set forth below shall be
increased by .375% for Level I or Level II, by .50% for Level III or Level IV,
and by .625% for Level V and the applicable LIBOR Rate Margin for Term Loans set
forth below shall be increased by .50% for each Applicable Rating Level set
forth below.

 
  LIBOR Rate Margin

--------------------------------------------------------------------------------

  Applicable Rating Level

--------------------------------------------------------------------------------

  Revolver Loans

--------------------------------------------------------------------------------

  Term Loans

--------------------------------------------------------------------------------

  Level I   1.25 % 2.50 % Level II   1.50 % 2.50 % Level III   2.00 % 2.75 %
Level IV   2.25 % 2.75 % Level V   2.50 % 2.75 %

Changes in the applicable LIBOR Rate Margin will occur automatically, without
prior notice as changes in the Applicable Rating Level occur. Administrative
Agent will give notice promptly to Borrower and Lenders of changes in the
applicable LIBOR Rate Margin.

        "Lien" means, with respect to any property or assets, any right or
interest therein of a creditor to secure Liabilities owed to it or any other
arrangement with such creditor which provides for the payment of such
Liabilities out of such property or assets or which allows such creditor to have
such Liabilities satisfied out of such property or assets prior to the general
creditors of any owner thereof, including any lien, mortgage, security interest,
pledge, deposit, production payment, rights of a vendor under any title
retention or conditional sale agreement or lease substantially equivalent
thereto, tax lien, mechanic's or materialman's lien, or any other charge or
encumbrance for security purposes, whether arising by Law or agreement or
otherwise, but excluding any right of offset which arises without agreement in
the ordinary course of business. "Lien" also means any filed financing
statement, any registration of a pledge (such as with an issuer of
uncertificated securities), or any other arrangement or action which would serve
to perfect a Lien described in the preceding sentence, regardless of whether
such financing statement is filed, such registration is made, or such
arrangement or action is undertaken before or after such Lien exists.

        "Loans" means all Revolver Loans and all Term Loans.

        "Loan Documents" means this Agreement, the Notes, the Security
Documents, the Letters of Credit, the LC Applications, and all other agreements,
certificates, documents, instruments and writings at any time delivered in
connection herewith or therewith (exclusive of term sheets and commitment
letters).

        "Majority Lenders" means Lenders whose aggregate Percentage Shares
exceed fifty percent (50%).

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        "Material Adverse Change" means a material and adverse change, from the
state of affairs presented in the Initial Financial Statements or as represented
or warranted in any Loan Document, to (a) Pacific Energy Partners' Consolidated
financial condition, (b) the operations, income or properties of Pacific Energy
Partners and its Subsidiaries considered as a whole, (c) Borrower's ability to
timely pay the Obligations, or (d) the enforceability of the material terms of
any Loan Document.

        "Matured LC Obligations" means all amounts paid by LC Issuer on drafts
or demands for payment drawn or made under any Letter of Credit and all other
amounts due and owing to LC Issuer under any LC Application for any Letter of
Credit, to the extent the same have not been repaid to LC Issuer (with the
proceeds of Loans or otherwise).

        "Maximum Drawing Amount" means at the time in question the sum of the
maximum amounts which LC Issuer might then or thereafter be called upon to
advance under all Letters of Credit then outstanding.

        "Maximum Revolver Facility Amount" means the amount of $200,000,000, as
such amount may be reduced from time to time as provided in Section 2.6 or as
such amount may be reduced by Borrower from time to time as provided in
Section 2.12.

        "Moody's" means Moody's Investor Service, Inc., or its successor.

        "Net Proceeds" shall mean the proceeds of any sale of assets in the form
of cash or cash equivalents including payments in respect of deferred payment
obligations when received in the form of cash or cash equivalents net of
(i) brokerage commissions and other fees and expenses related to such sale,
(ii) provisions for any taxes payable by Restricted Persons as a result of such
sale, (iii) amounts required to be paid to any Person (other than a Restricted
Person) owning a beneficial interest in the assets sold, (iv) appropriate
amounts to be provided by the Restricted Persons, as a reserve required in
accordance with GAAP for post-closing adjustments against any liabilities
associated with such sale of assets and retained by the Restricted Persons,
after such sale, (v) amounts required to be applied to the repayment of
Indebtedness secured by a Lien on the assets sold and (vi) a reserve for a
distribution by Pacific Energy Partners to its partners in respect of tax
attributable to such sale not to exceed the Maximum Tax Rate times the gain from
the taxable disposition of such assets, such gain to be calculated as provided
in Section 5.5(b)(iv) of the Partnership Agreement; provided, however, any
portion of the reserve under clause (vi) of this definition that is not included
in a declared distribution on the first record date following the date of such
sale shall be deemed to be "Net Proceeds" received on the date of such sale.
"Maximum Tax Rate" shall be the blended federal and state income tax rate
applicable to individual taxpayers in respect of such gain at the time of such
sale (applying the highest effective state and federal income tax rates adjusted
to take into account the deductibility of state income tax for federal income
tax purposes and using the state income tax rate applicable in the State of New
York) taking into account the portion of such gain which is treated as ordinary
income and the portion of such gain which is treated as capital gain.

        "Notes" means all Revolver Notes and all Term Notes.

        "Obligations" means all advances to, and debts, liabilities,
obligations, covenants and duties of, any Restricted Person arising under any
Loan Document, including all Loans and all LC Obligations, whether direct or
indirect (including those acquired by assumption), absolute or contingent, due
or to become due, now existing or hereafter arising and including interest and
expense reimbursement obligations that accrue after the commencement by or
against any Restricted Person of any proceeding under any applicable bankruptcy,
liquidation, receivership, insolvency or similar Laws naming such Person as the
debtor in such proceeding. "Obligation" means any part of the Obligations.

        "Offsetting Position" means, with respect to any Petroleum Inventory
Position, any offsetting sale, purchase or exchange agreement, an offsetting
physical inventory position (excluding tank bottoms and

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pipeline linefill inventory classified as a long term asset and working
inventory not held for resale), or an offsetting Hedging Contract, in each case
eliminating price risk and reasonably mitigating basis risk.

        "Open Position" means any Petroleum Inventory Position that does not
have an Offsetting Position; provided that, a purchase, sale, exchange or
similar contract without an Offsetting Position that is priced on an index which
eliminates price risk and substantially all basis risk shall not be treated as
an Open Position.

        "Pacific Energy Partners" means Pacific Energy Partners, L.P., a
Delaware limited partnership.

        "Pacific Energy Partners Registration Statement" means Borrower's
Form S-1, as filed with the Securities and Exchange Commission on March 22,
2002, as amended and in effect on the Closing Date.

        "Partnership Agreement" means the First Amended and Restated Agreement
of Limited Partnership of Pacific Energy Partners to be executed in connection
with the closing of the transactions contemplated by the Pacific Energy Partners
Registration Statement.

        "Percentage Share" means, with respect to any Lender, the percentage
obtained by dividing (i) the sum of the outstanding Term Loans of such Lender
plus the outstanding Revolver Commitment (or, if greater, the outstanding
Revolver Facility Usage) of such Lender, by (ii) the sum of the aggregate
outstanding Term Loans plus the aggregate outstanding Revolver Commitment (or,
if greater, the outstanding Revolver Facility Usage).

        "Permitted Acquisitions" means (a) the acquisition of all (or an
acquisition resulting in the ownership of all) of the Equity Interest in a
Person (exclusive of general partner interests held by General Partner not in
excess of a 2% economic interest and exclusive of director qualifying shares and
Equity Interests required to be held by an Affiliate to comply with a
requirement of Law), or (b) any other acquisition of all or a portion of the
business, assets or operations of a Person (whether in a single transaction or a
series of related transactions), or (c) an acquisition of (or an acquisition
resulting in the ownership of) more than fifty percent (50%) but less than all,
of the Equity Interest of any Person having ordinary voting power for the
election of directors, managers, managing members or managing general partners,
provided that such Person is properly designated as an Unrestricted Subsidiary
subject to compliance with Sections 6.17 and 6.18, or (d) an acquisition of any
Equity Interest of any Person, other than as allowed under clauses (a) and (c),
in an amount which, when combined with all other acquisitions allowed in this
clause (d) and Permitted Investments under clause (f) of the definition of
Permitted Investments, does not exceed an aggregate amount at any time of
$30,000,000; provided that, (i) prior to and after giving effect to such
acquisition in clauses (a), (b), (c) or (d), no Default or Event of Default
shall have occurred and be continuing; (ii) all representations and warranties
shall be true and correct as if restated immediately following the consummation
of such acquisition; and (iii) substantially all of such business, assets and
operations so acquired, or of the Person so acquired, consists of a Present and
Related Business and (iv) satisfaction of the requirements of clauses (i),
(ii) and (iii) have been certified in a certificate by Pacific Energy Partners
and Borrower delivered to the Administrative Agent as promptly as possible and
in no event less than five Business Days prior to the consummation of such
acquisition.

        "Permitted Inventory Liens" means any Lien on Petroleum Inventory
permitted under Section 7.2(ii)(b) (so long as such Lien is inchoate) or
Section 7.2(ii)(d).

        "Permitted Investments" means:

        (a)  Cash Equivalents;

        (b)  the EPTC Acquisition;

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        (c)  existing Investments described in the Disclosure Schedule and
Investments in Frontier Pipeline Company after the date of this Agreement
relating to the existing rate based litigation not to exceed the aggregate
amount of $3,000,000;

        (d)  Investments by Pacific Energy Partners or any of its Restricted
Subsidiaries (i) in any Restricted Person (other than Pacific Energy Partners)
or (ii) in Pacific Energy Partners to the extent permitted by Section 7.1(c) or
7.5(b)(ii), in each case subject, in the case of any Indebtedness created
thereby, to the provisions of Section 7.1(c);

        (e)  Investments by Pacific Energy Partners or any of its Restricted
Subsidiaries in any Unrestricted Subsidiary, subject to compliance with Sections
6.17 and 6.18;

        (f)    Investments (i) in a Person acquired pursuant to clause (d) of
the definition of Permitted Acquisitions and, when combined with other
Investments allowed under this clause (f), in an amount permitted under such
clause (d) of the definition of Permitted Acquisitions or (ii) in Frontier
Pipeline Company after the date of this Agreement (other than Investments in
Frontier Pipeline Company described in clause (c) above) for capital calls only
with no change in equity ownership not to exceed the aggregate amount of
$3,000,000 and, when combined with other Investments allowed pursuant to this
clause (f), in an amount permitted under clause (d) of the definition of
Permitted Acquisitions; or

        (g)  normal and prudent extensions of credit by Restricted Persons to
their customers for goods and services in the ordinary course of business and on
ordinary trade terms.

        "Permitted Lien" has the meaning given to such term in Section 7.2.

        "Person" means an individual, corporation, partnership, limited
liability company, association, joint stock company, trust or trustee thereof,
estate or executor thereof, unincorporated organization or joint venture,
Tribunal, or any other legally recognizable entity.

        "Petroleum Inventory" means crude oil, refined products thereof,
condensate, natural gas, natural gas liquids, liquefied petroleum gases or any
blend thereof.

        "Petroleum Inventory Position" means (i) any physical Petroleum
Inventory or (ii) any purchase, sale, exchange or other similar contract (other
than a Hedging Contract) for Petroleum Inventory.

        "Present and Related Business" means and includes (a) the purchase,
sale, exchange, marketing, gathering, blending, processing, transportation,
storage and terminaling of Petroleum Inventory, (b) pipeline operation, and
(c) businesses and operations incidental thereto, but Present and Related
Business shall not include trading of Petroleum Inventory by a Related Person
other than incidental to the gathering, blending or pipeline operations of a
Related Person.

        "PUC Restricted Subsidiary" means any Restricted Subsidiary that is
required to be regulated as a public utility under applicable Law and that is
prohibited under such applicable Law from incurring a Guaranty and/or granting
Liens or security interests in any Real Property Collateral, in each case
without the approval of the applicable PUC.

        "Rating Agency" means either S&P or Moody's.

        "Real Property Collateral" has the meaning given to such term in
Section 6.16(a).

        "Regulation D" means Regulation D of the Board of Governors of the
Federal Reserve System as from time to time in effect.

        "Reinvestment" means used for capital expenditures in connection with
the Present and Related Business of a Restricted Person.

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        "Related Person" means any of Pacific Energy Partners and each
Subsidiary of Pacific Energy Partners, including but not limited to Borrower and
each Subsidiary of Borrower.

        "Responsible Officer" means any of the following of Borrower or General
Partner: a limited liability company manager (with respect to Borrower) if an
individual, a vice president or higher company officer, chief financial officer
and treasurer.

        "Restricted Person" means any of Pacific Energy Partners and each
Restricted Subsidiary of Pacific Energy Partners, including but not limited to
Borrower and each Restricted Subsidiary of Borrower.

        "Restricted Subsidiary" means any Subsidiary of Pacific Energy Partners
that is not an Unrestricted Subsidiary.

        "Revolver Commitment" means $200,000,000. Each Revolver Lender's
Revolver Commitment shall be the amount set forth for such Revolver Lender on
the Lender Schedule.

        "Revolver Facility" means, at any time, the aggregate amount of Revolver
Lenders' Revolver Commitments at such time.

        "Revolver Facility Usage" means, at the time in question, the aggregate
amount of outstanding Revolver Loans and LC Obligations at such time.

        "Revolver Lender" means each holder of a Revolver Note.

        "Revolver Loan" has the meaning given such term in Section 2.1(a).

        "Revolver Maturity Date" means July 26, 2007.

        "Revolver Note" has the meaning given such term in Section 2.1(a).

        "Revolver Percentage Share" means, with respect to any Revolver Lender
(a) when used in Sections 2.1(a), 2.2 or 2.12(b), in any Borrowing Notice or
when no Revolver Loans are outstanding hereunder, the percentage set forth
opposite such Revolver Lender's name on the Lender Schedule hereto, and (b) when
used otherwise, the percentage obtained by dividing (i) the sum of the unpaid
principal balance of such Revolver Lender's Revolver Loans at the time in
question plus the Matured LC Obligations which such Revolver Lender has funded
pursuant to Section 2.9(c) plus the portion of the Maximum Drawing Amount which
such Revolver Lender might be obligated to fund under Section 2.9(c), by
(ii) the sum of the aggregate unpaid principal balance of all Revolver Loans at
such time plus the aggregate amount of LC Obligations outstanding at such time.

        "S&P" means Standard & Poor's Ratings Services (a division of McGraw
Hill, Inc.) or its successor.

        "Security Documents" means the instruments listed in the Security
Schedule and all other security agreements, deeds of trust, mortgages, pledges,
guaranties, financing statements, continuation statements, extension agreements
and other agreements or instruments now, heretofore, or hereafter delivered by
any Restricted Person to Administrative Agent in connection with this Agreement
or any transaction contemplated hereby to secure or guarantee the payment of any
part of the Obligations or Lender Hedging Obligations or the performance of any
Restricted Person's other duties and obligations under the Loan Documents.

        "Security Schedule" means Schedule 3 hereto.

        "Senior Indebtedness" means Indebtedness for borrowed money other than
(i) the Obligations, (ii) Subordinated Indebtedness, (iii) Indebtedness to
another Restricted Person, (iv) Lender Hedging Obligations or (v) Indebtedness
described in Section 7.1(e) or (f).

        "Subordinated Indebtedness" means unsecured Indebtedness for borrowed
money of Borrower or Pacific Energy Partners that (i) does not mature or have
scheduled payments prior to the latest

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maturity date of the Obligations, (ii) is subordinated to the Obligations and
Lender Hedging Obligations on terms satisfactory to Majority Lenders in their
sole and absolute discretion, and (iii) has covenants and events of default
that, taken as a whole, are not more burdensome to the Restricted Persons than
those contained in this Agreement.

        "Subsidiary" means, with respect to any Person, any corporation,
association, partnership, limited liability company, joint venture, or other
business or corporate entity, enterprise or organization which is directly or
indirectly (through one or more intermediaries) controlled or owned more than
fifty percent by such Person.

        "Systems" means all gathering systems, transportation pipelines, plants,
compressors, storage facilities, injection stations, terminals, trucking
operations, pumps and heaters, and the equipment, fixtures and improvements
located thereon or used in connection therewith, in which any Restricted Person
owns an interest.

        "Term Commitment" means $225,000,000. Each Term Lender's Term Commitment
shall be the amount set forth for such Term Lender on the Lender Schedule.

        "Term Lender" means each holder of a Term Note.

        "Term Loan" has the meaning given such term in Section 2.1(b).

        "Term Loan Maturity Date" means July 26, 2009.

        "Term Note" has the meaning given such term in Section 2.1(b).

        "Termination Event" means (a) the occurrence with respect to any ERISA
Plan of (i) a reportable event described in Sections 4043(c)(5) or (6) of ERISA
or (ii) any other reportable event described in Section 4043(c) of ERISA other
than a reportable event not subject to the provision for 30-day notice to the
Pension Benefit Guaranty Corporation pursuant to a waiver by such corporation
under Section 4043(a) of ERISA, or (b) the withdrawal of any ERISA Affiliate
from an ERISA Plan during a plan year in which it was a "substantial employer"
as defined in Section 4001(a)(2) of ERISA, or (c) the filing of a notice of
intent to terminate any ERISA Plan or the treatment of any ERISA Plan amendment
as a termination under Section 4041 of ERISA, or (d) the institution of
proceedings to terminate any ERISA Plan by the Pension Benefit Guaranty
Corporation under Section 4042 of ERISA, or (e) any other event or condition
which might constitute grounds under Section 4042 of ERISA for the termination
of, or the appointment of a trustee to administer, any ERISA Plan.

        "Tribunal" means any government, any arbitration panel, any court or any
governmental department, commission, board, bureau, agency or instrumentality of
the United States of America or any state, province, commonwealth, nation,
territory, possession, county, parish, town, township, village or municipality,
whether now or hereafter constituted or existing.

        "Type" means, with respect to any Loans, the characterization of such
Loans as either Base Rate Loans or LIBOR Loans.

        "UCC" means the Uniform Commercial Code as in effect in the State of New
York.

        "Unrestricted Subsidiary" means any Subsidiary of Pacific Energy
Partners that Borrower has designated in writing to be an Unrestricted
Subsidiary pursuant to Section 6.18 and that Borrower has not redesignated to be
a Restricted Subsidiary pursuant to Section 6.18.

        "Wholly Owned Subsidiary" means any Subsidiary of a Person, all of the
issued and outstanding Equity Interests of which (including all rights or
options to acquire such Equity Interests) are directly or indirectly (through
one or more Subsidiaries) owned by such Person, excluding any general partner
interests owned, directly or indirectly, by General Partner in any such
Subsidiary that is a partnership,

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in each case such general partner interests not to exceed 2% of the aggregate
ownership interests of any such partnership and directors' qualifying shares if
applicable.

        "Working Capital Amount" means $45,000,000.

        "Working Capital Loans" means any Revolver Loans for working capital
purposes or to fund distributions by Pacific Energy Partners.

        "Working Capital Usage" means at the time in question, the aggregate
amount of outstanding Working Capital Loans and LC Obligations at such time.

        Section 1.2.    Exhibits and Schedules; Additional Definitions.    All
Exhibits and Schedules attached to this Agreement are a part hereof for all
purposes. Reference is hereby made to the Security Schedule for the meaning of
certain terms defined therein and used but not defined herein, which definitions
are incorporated herein by reference.

        Section 1.3.    Amendment of Defined Instruments.    Unless the context
otherwise requires or unless otherwise provided herein the terms defined in this
Agreement which refer to a particular agreement, instrument or document also
refer to and include all renewals, extensions, modifications, amendments and
restatements of such agreement, instrument or document, provided that nothing
contained in this section shall be construed to authorize any such renewal,
extension, modification, amendment or restatement.

        Section 1.4.    References and Titles.    All references in this
Agreement to Exhibits, Schedules, articles, sections, subsections and other
subdivisions refer to the Exhibits, Schedules, articles, sections, subsections
and other subdivisions of this Agreement unless expressly provided otherwise.
Exhibits and Schedules to any Loan Document shall be deemed incorporated by
reference in such Loan Document. References to any document, instrument, or
agreement (a) shall include all exhibits, schedules, and other attachments
thereto, and (b) shall include all documents, instruments, or agreements issued
or executed in replacement thereof. Titles appearing at the beginning of any
subdivisions are for convenience only and do not constitute any part of such
subdivisions and shall be disregarded in construing the language contained in
such subdivisions. The words "this Agreement," "this instrument," "herein,"
"hereof," "hereby," "hereunder" and words of similar import refer to this
Agreement as a whole and not to any particular subdivision unless expressly so
limited. The phrases "this section" and "this subsection" and similar phrases
refer only to the sections or subsections hereof in which such phrases occur.
The word "or" is not exclusive, and the word "including" (in its various forms)
means "including without limitation." Pronouns in masculine, feminine and neuter
genders shall be construed to include any other gender, and words in the
singular form shall be construed to include the plural and vice versa, unless
the context otherwise requires. Accounting terms have the meanings assigned to
them by GAAP, as applied the accounting entity to which they refer. References
to "days" shall mean calendar days, unless the term "Business Day" is used.
Unless otherwise specified, references herein to any particular Person also
refer to its successors and permitted assigns. References to the execution of a
certificate by an officer of a Person are to the execution in his or her
capacity as such officer on behalf of such Person and not individually.

        Section 1.5.    Calculations and Determinations.    All calculations
under the Loan Documents of interest chargeable with respect to LIBOR Loans and
of fees shall be made on the basis of actual days elapsed (including the first
day but excluding the last) and a year of 360 days. All calculations under the
Loan Documents of interest chargeable with respect to Base Rate Loans shall be
made on the basis of actual days elapsed (including the first day but excluding
the last) and a year of 365 or 366 days, as appropriate. Each determination by a
Lender Party of amounts to be paid under Article III or any other matters which
are to be determined hereunder by a Lender Party (such as any LIBOR Rate,
Business Day, Interest Period, or Reserve Percentage) shall, in the absence of
manifest error, be conclusive and binding. Unless otherwise expressly provided
herein or unless Majority Lenders

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otherwise consent all financial statements and reports furnished to any Lender
Party hereunder shall be prepared and all financial computations and
determinations pursuant hereto shall be made in accordance with GAAP.

        Section 1.6.    Joint Preparation; Construction of Indemnities and
Releases.    This Agreement and the other Loan Documents have been reviewed and
negotiated by sophisticated parties with access to legal counsel and no rule of
construction shall apply hereto or thereto which would require or allow any Loan
Document to be construed against any party because of its role in drafting such
Loan Document. All indemnification and release provisions of this Agreement
shall be construed broadly (and not narrowly) in favor of the Persons receiving
indemnification or being released.

ARTICLE II—The Loans and Letters of Credit

        Section 2.1.    Commitments to Lend; Notes.    

        (a)    Revolver Loans.    Subject to the terms and conditions hereof,
each Revolver Lender agrees to make loans to Borrower (herein called such
Lender's "Revolver Loans") upon Borrower's request from time to time during the
Commitment Period, provided that (a) subject to Sections 3.3, 3.4 and 3.5, all
Revolver Lenders are requested to make Revolver Loans of the same Type in
accordance with their respective Revolver Percentage Shares and as part of the
same Borrowing, and (b) after giving effect to such Loans, the Revolver Facility
Usage does not exceed the Maximum Revolver Facility Amount and the Working
Capital Usage does not exceed the Working Capital Amount. The aggregate amount
of all Revolver Loans in any Borrowing must be equal to $1,000,000 or any higher
integral multiple of $500,000. Borrower may have no more than five Borrowings of
Revolver Loans which are LIBOR Loans outstanding at any time. The obligation of
Borrower to repay to each Revolver Lender the aggregate amount of all Revolver
Loans made by such Revolver Lender, together with interest accruing in
connection therewith, shall be evidenced by a single promissory note (herein
called such Lender's "Revolver Note") made by Borrower payable to the order of
such Revolver Lender in the form of Exhibit A-1 with appropriate insertions. The
amount of principal owing on any Revolver Lender's Revolver Note at any given
time shall be the aggregate amount of all Revolver Loans theretofore made by
such Revolver Lender minus all payments of principal theretofore received by
such Revolver Lender on such Revolver Note. Interest on each Revolver Note shall
accrue and be due and payable as provided herein and therein. Each Revolver Note
shall be due and payable as provided herein and therein, and shall be due and
payable in full on the last day of the Revolver Maturity Date. Subject to the
terms and conditions of this Agreement, Borrower may borrow, repay, and reborrow
under this Section 2.1(a).

        (b)    Term Loans.    Subject to the terms and conditions hereof, each
Term Lender agrees to make a single advance to Borrower (herein called such
Lender's "Term Loans") on the Closing Date, provided that (a) each Term Loan
does not exceed such Term Lender's Term Commitment set forth on the Lender
Schedule and (b) the aggregate amount of all Term Loans does not exceed the
total Term Commitment. Term Loans shall consist of Base Rate Loans or LIBOR
Loans, or a combination thereof as Borrower may request in writing as provided
in Section 2.2 or as otherwise provided in Section 2.3. The obligation of
Borrower to repay to each Term Lender the amount of the Term Loan made by such
Term Lender, together with interest accruing in connection therewith, shall be
evidenced by a single promissory note (herein called such Term Lender's "Term
Note") made by Borrower payable to the order of such Term Lender in the form of
Exhibit A-2 with appropriate insertions. The amount of principal owing on any
Term Lender's Term Note at any given time shall be the amount of such Term
Lender's Term Loan minus all payments of principal theretofore received by such
Term Lender on such Term Note. Interest on each Term Note shall accrue and be
due and payable as provided herein and therein. Each Term Note shall be due and
payable as provided herein and therein, and shall be due and payable in full on
the Term Loan Maturity Date. No portion of any Term Loan which has been repaid
may be reborrowed.

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        Section 2.2.    Requests for New Loans.    Borrower must give to
Administrative Agent written notice (or telephonic notice promptly confirmed in
writing) of any requested Borrowing of Loans to be funded by Lenders. Each such
notice constitutes a "Borrowing Notice" hereunder and must:

        (a)  specify (i) the aggregate amount of any such Borrowing of Base Rate
Loans and the date on which such Base Rate Loans are to be advanced, or (ii) the
aggregate amount of any such Borrowing of LIBOR Loans, the date on which such
LIBOR Loans are to be advanced (which shall be the first day of the Interest
Period which is to apply thereto), and the length of the applicable Interest
Period;

        (b)  in the case of the Loans on the Closing Date, specify whether the
Loans are Revolver Loans or Term Loans;

        (c)  in the case of Revolver Loans, specify whether any amounts will be
used to fund distributions by Pacific Energy Partners; and

        (d)  be received by Administrative Agent not later than 12:00 noon,
Boston, Massachusetts time, on (i) the day on which any such Base Rate Loans are
to be made, or (ii) the third Business Day preceding the day on which any such
LIBOR Loans are to be made.

Each such written request or confirmation must be made in the form and substance
of the "Borrowing Notice" attached hereto as Exhibit B, duly completed. Each
such telephonic request shall be deemed a representation, warranty,
acknowledgment and agreement by Borrower as to the matters which are required to
be set out in such written confirmation. Upon receipt of any such Borrowing
Notice, Administrative Agent shall give each Lender prompt notice of the terms
thereof. If all conditions precedent to such new Loans have been met, each
Lender will on the date requested promptly remit to Administrative Agent at
Administrative Agent's office in Boston, Massachusetts the amount of such
Lender's Loan in immediately available funds, and upon receipt of such funds,
unless to its actual knowledge any conditions precedent to such Loans have been
neither met nor waived as provided herein, Administrative Agent shall promptly
make such Loans available to Borrower. Unless Administrative Agent shall have
received prompt notice from a Lender that such Lender will not make available to
Administrative Agent such Lender's new Loan, Administrative Agent may in its
discretion assume that such Lender has made such Loan available to
Administrative Agent in accordance with this section and Administrative Agent
may if it chooses, in reliance upon such assumption, make such Loan available to
Borrower. If and to the extent such Lender shall not so make its new Loan
available to Administrative Agent, such Lender and Borrower severally agree to
pay or repay to Administrative Agent within three days after demand the amount
of such Loan together with interest thereon, for each day from the date such
amount was made available to Borrower until the date such amount is paid or
repaid to Administrative Agent, with interest at (i) the Federal Funds Rate, if
such Lender is making such payment and (ii) the interest rate applicable at the
time to the other new Loans made on such date, if Borrower is making such
repayment. If neither such Lender nor Borrower pays or repays to Administrative
Agent such amount within such three-day period, Administrative Agent shall be
entitled to recover from Borrower, on demand, in lieu of the interest provided
for in the preceding sentence, interest thereon at the Default Rate, calculated
from the date such amount was made available to Borrower. The failure of any
Lender to make any new Loan to be made by it hereunder shall not relieve such
Lender of liability to Borrower for failure to lend and shall not relieve any
other Lender of its obligation hereunder, if any, to make its new Loan, but no
Lender shall be responsible for the failure of any other Lender to make any new
Loan to be made by such other Lender.

        Section 2.3.    Continuations and Conversions of Existing
Loans.    Borrower may make the following elections with respect to Term Loans
or Revolver Loans already outstanding: to Convert, in whole or in part, Base
Rate Loans to LIBOR Loans, to Convert, in whole or in part, LIBOR Loans to Base
Rate Loans on the last day of the Interest Period applicable thereto, and to
Continue, in whole or in part, LIBOR Loans beyond the expiration of such
Interest Period by designating a new Interest Period to

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take effect at the time of such expiration. In making such elections, Borrower
may combine existing Loans made pursuant to separate Borrowings into one new
Borrowing or divide existing Loans made pursuant to one Borrowing into separate
new Borrowings, provided that (i) Borrower may have no more than ten
(10) Borrowings of LIBOR Loans outstanding at any time and (ii) no combinations
may be made between Borrowings constituting Revolver Loans on the one hand and
Borrowings constituting Term Loans on the other hand. To make any such election,
Borrower must give to Administrative Agent written notice (or telephonic notice
promptly confirmed in writing) of any such Conversion or Continuation of
existing Loans, with a separate notice given for each new Borrowing. Each such
notice constitutes a "Continuation/Conversion Notice" hereunder and must:

        (a)  specify the existing Loans which are to be Continued or Converted;

        (b)  specify (i) the aggregate amount of any Borrowing of Base Rate
Loans into which such existing Loans are to be Continued or Converted and the
date on which such Continuation or Conversion is to occur, or (ii) the aggregate
amount of any Borrowing of LIBOR Loans into which such existing Loans are to be
Continued or Converted, the date on which such Continuation or Conversion is to
occur (which shall be the first day of the Interest Period which is to apply to
such LIBOR Loans), and the length of the applicable Interest Period; and

        (c)  be received by Administrative Agent not later than 12:00 noon,
Boston, Massachusetts time, on (i) the day on which any such Continuation or
Conversion to Base Rate Loans is to occur, or (ii) the third Business Day
preceding the day on which any such Continuation or Conversion to LIBOR Loans is
to occur.

Each such written request or confirmation must be made in the form and substance
of the "Continuation/Conversion Notice" attached hereto as Exhibit C, duly
completed. Each such telephonic request shall be deemed a representation,
warranty, acknowledgment and agreement by Borrower as to the matters which are
required to be set out in such written confirmation. Upon receipt of any such
Continuation/Conversion Notice, Administrative Agent shall give each Lender
prompt notice of the terms thereof. Each Continuation/Conversion Notice shall be
irrevocable and binding on Borrower. During the continuance of any Default,
Borrower may not make any election to Convert existing Loans into LIBOR Loans or
Continue existing Loans as LIBOR Loans beyond the expiration of their respective
and corresponding Interest Period then in effect. If (due to the existence of a
Default or for any other reason) Borrower fails to timely and properly give any
Continuation/Conversion Notice with respect to a Borrowing of existing LIBOR
Loans at least three days prior to the end of the Interest Period applicable
thereto, such LIBOR Loans, to the extent not prepaid at the end of such Interest
Period, shall automatically be Converted into Base Rate Loans at the end of such
Interest Period. No new funds shall be repaid by Borrower or advanced by any
Lender in connection with any Continuation or Conversion of existing Loans
pursuant to this section, and no such Continuation or Conversion shall be deemed
to be a new advance of funds for any purpose; such Continuations and Conversions
merely constitute a change in the interest rate applicable to already
outstanding Loans.

        Section 2.4.    Use of Proceeds.    Borrower shall use the proceeds of
all Revolver Loans (a) to fund the EPTC Acquisition, (b) to finance Permitted
Acquisitions, (c) for general company purposes and (d) up to the Working Capital
Amount and subject to Section 7.6, for working capital purposes or to fund
quarterly distributions by Pacific Energy Partners pursuant to the Partnership
Agreement. Borrower shall use the proceeds of all Term Loans to (i) make a
distribution to the General Partner in consideration for assets contributed to
the Restricted Persons as described in the Pacific Energy Partners Registration
Statement, (ii) partially pay the purchase price for Borrower's purchase of the
indebtedness under the Citibank Credit Agreement, (iii) partially repay the
indebtedness under the Existing Credit Agreements, (iv) refinance the
indebtedness under the Existing US Bank Agreement, and (v) pay fees, costs and
expenses owed pursuant to this Agreement and incurred pursuant to the offering
contemplated by the Pacific Energy Partners Registration Statement. Borrower
shall use all

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Letters of Credit solely for the purposes specified in Section 2.7(e). In no
event shall any Loan or any Letter of Credit be used (i) directly or indirectly
by any Person for personal, family, household or agricultural purposes, (ii) for
the purpose, whether immediate, incidental or ultimate, of purchasing, acquiring
or carrying any "margin stock" (as such term is defined in Regulation U
promulgated by the Board of Governors of the Federal Reserve System) or (iii) to
extend credit to others directly or indirectly for the purpose of purchasing or
carrying any such margin stock. Borrower represents and warrants that Borrower
is not engaged principally, or as one of Borrower's important activities, in the
business of extending credit to others for the purpose of purchasing or carrying
such margin stock.

        Section 2.5.    Optional Prepayments of Loans; Interest and Premium on
Prepayments.    

        (a)    Revolver Loans.    Borrower may, upon three Business Days' notice
to Administrative Agent (and Administrative Agent will promptly give notice to
the other Revolver Lenders), from time to time and without premium or penalty
prepay the Revolver Loans, in whole or in part, so long as the aggregate amounts
of all partial prepayments of principal on the Revolver Loans equals $1,000,000
or any higher integral multiple of $500,000; or any lesser amount necessary to
prepay the Revolver Loans in full.

        (b)    Term Loans.    Borrower may, upon three Business Days' notice to
each Term Lender from time to time and without premium (except as provided in
this Section 2.5(b)) or penalty prepay the Term Loans, in whole or in part, so
long as the aggregate of amounts of all partial prepayments of principal on the
Term Loans equals $1,000,000 or any higher integral multiple of $500,000; or any
lesser amount necessary to prepay the Term Loans in full. If the Term Loans
shall be voluntarily prepaid as provided in this Section 2.5 (b), in whole or
from time to time in part, on or before the first anniversary of the Closing
Date, Borrower shall pay to Administrative Agent for the account of each Term
Lender a prepayment premium in an amount equal to one percent (1.00%) of the
amount of any such prepayment. Each partial prepayment of the Term Loans under
this Section 2.5(b) shall be applied to the regular installments of principal
due under the Term Notes in the inverse order of their maturities.

        (c)    Interest on Prepayments.    Each prepayment of principal under
this Section 2.5 or under Section 2.6 shall be accompanied by all interest then
accrued and unpaid on the principal so prepaid. Any principal or interest
prepaid pursuant to this Section 2.5 or under Section 2.6 shall be in addition
to, and not in lieu of, all payments otherwise required to be paid under the
Loan Documents at the time of such prepayment.

        Section 2.6.    Mandatory Prepayments.    

        (a)  On such date that is 180 days after the date any Restricted Person
has Excess Sale Proceeds, to the extent such Excess Sale Proceeds have not been
applied in accordance with clause (iii)(x) of Section 7.5(d), the Borrower will
(i) first, prepay a principal amount of the outstanding Term Loans equal to the
Excess Sale Proceeds and (ii) next, to the extent such Excess Sale Proceeds
exceed the principal amount of the Term Loans, permanently reduce the Maximum
Revolver Facility Amount in the amount of such remaining Excess Sale Proceeds,
and if the outstanding principal amount of the Revolver Facility Usage exceeds
the resulting Maximum Revolver Facility Amount, repay the Revolver Loans (or
provide LC Collateral in the circumstances set forth in Section 2.11) to the
extent of such excess.

        (b)  If at any time any Restricted Person shall incur any Senior
Indebtedness, Borrower will (i) first, prepay a principal amount of the
outstanding Term Loans equal to the net cash proceeds (net of underwriters' or
purchasers' discounts and commissions, legal, accountancy, registration, or
printing fees and expenses and other fees and expenses incurred in connection
with such offering to be paid or reimbursed by the issuer and net of any taxes,
if any, paid or payable as a result thereof) of such Senior Indebtedness and
(ii) next, to the extent such net cash proceeds exceed the principal amount of

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the Term Loans, permanently reduce the Maximum Revolver Facility Amount in the
amount of such remaining net cash proceeds, and if the outstanding principal
amount of the Revolver Usage exceeds the resulting Maximum Revolver Facility
Amount, repay the Revolver Loans (or provide LC Collateral in the circumstances
set forth in Section 2.11) to the extent of such excess.

        (c)  Each partial prepayment of the Term Loans under this Section 2.6
shall be applied to the regular installments of principal due under the Term
Notes in the inverse order of their maturities.

        Section 2.7.    Letters of Credit.    Subject to the terms and
conditions hereof, Borrower may, during the Commitment Period, request LC Issuer
to issue, amend, or extend the expiration date of, one or more Letters of
Credit, provided that:

        (a)  after taking such Letter of Credit into account, the Revolver
Facility Usage does not exceed the Maximum Revolver Facility Amount and the
aggregate amount of Working Capital Usage does not exceed the Working Capital
Amount;

        (b)  the expiration date of such Letter of Credit is prior to the
earlier of (i) (A) 70 days after the date of issuance (or such other longer
period of time acceptable to LC Issuer in its sole and absolute discretion),
with respect to Letters of Credit securing purchases of Petroleum Inventory, or
(B) one year after the date of issuance, with respect to all other Letters of
Credit, and (ii) the end of the Commitment Period;

        (c)  the issuance of such Letter of Credit will be in compliance with
all applicable governmental restrictions, policies, and guidelines and will not
subject LC Issuer to any cost which is not reimbursable under Article III;

        (d)  such Letter of Credit is in such form and terms (which terms may
include automatic renewal or evergreen provisions) as shall be acceptable to LC
Issuer in its sole and absolute discretion;

        (e)  such Letter of Credit is issued to secure surety bonds, the
purchase of Petroleum Inventory or the acquisition of licenses or franchises for
the benefit of other vendors (such as equipment vendors); and

        (f)    all other conditions in this Agreement to the issuance of such
Letter of Credit have been satisfied.

LC Issuer will honor any such request if the foregoing conditions (a) through
(f) (in the following Section 2.8 called the "LC Conditions") have been met as
of the date of issuance, amendment, or extension of such Letter of Credit.

        Section 2.8.    Requesting Letters of Credit.    Borrower must make
written application for any Letter of Credit at least two Business Days before
the date on which Borrower desires for LC Issuer to issue such Letter of Credit.
By making any such written application, unless otherwise expressly stated
therein, Borrower shall be deemed to have represented and warranted that the LC
Conditions described in Section 2.7 will be met as of the date of issuance of
such Letter of Credit. Each such written application for a Letter of Credit must
be made in writing in a form then in normal use for such purpose by LC Issuer
(or in such other form as may mutually be agreed upon by LC Issuer and
Borrower). If all LC Conditions for a Letter of Credit have been met as
described in Section 2.7 on any Business Day before 12:00 noon, Boston,
Massachusetts time, LC Issuer will issue such Letter of Credit on the same
Business Day at LC Issuer's office in Boston, Massachusetts. If the LC
Conditions are met as described in Section 2.7 on any Business Day on or after
12:00 noon, Boston, Massachusetts time, LC Issuer will issue such Letter of
Credit on the next succeeding Business Day at LC Issuer's office in Boston,
Massachusetts. If any provisions of any LC Application conflict with any
provisions of this Agreement, the provisions of this Agreement shall govern and
control.

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        Section 2.9.    Reimbursement and Participations.    

        (a)    Reimbursement.    Each Matured LC Obligation shall constitute a
loan by LC Issuer to Borrower. Borrower promises to pay to LC Issuer, or to LC
Issuer's order, on demand, the full amount of each Matured LC Obligation
together with interest thereon (i) at the Base Rate plus the Base Rate Margin to
and including the second Business Day after the Matured LC Obligation is
incurred and (ii) at the Default Rate on each day thereafter.

        (b)    Letter of Credit Advances.    If the beneficiary of any Letter of
Credit makes a draft or other demand for payment thereunder then Borrower may,
during the interval between the making thereof and the honoring thereof by LC
Issuer, request Revolver Lenders to make Revolver Loans to Borrower in the
amount of such draft or demand, which Revolver Loans shall be made concurrently
with LC Issuer's payment of such draft or demand and shall be immediately used
by LC Issuer to repay the amount of the resulting Matured LC Obligation. Such a
request by Borrower shall be made in compliance with all of the provisions
hereof, provided that for the purposes of the first sentence of Section 2.1, the
amount of such Revolver Loans shall be considered, but the amount of the Matured
LC Obligation to be concurrently paid by such Revolver Loans shall not be
considered.

        (c)    Participation by Lenders.    LC Issuer irrevocably agrees to
grant and hereby grants to each Revolver Lender, and—to induce LC Issuer to
issue Letters of Credit hereunder—each Revolver Lender irrevocably agrees to
accept and purchase and hereby accepts and purchases from LC Issuer, on the
terms and conditions hereinafter stated and for such Revolver Lender's own
account and risk an undivided interest equal to such Revolver Lender's Revolver
Percentage Share of LC Issuer's obligations and rights under each Letter of
Credit issued hereunder and the amount of each Matured LC Obligation paid by LC
Issuer thereunder. Each Revolver Lender unconditionally and irrevocably agrees
with LC Issuer that, if a Matured LC Obligation is paid under any Letter of
Credit for which LC Issuer is not reimbursed in full by Borrower in accordance
with the terms of this Agreement and the related LC Application (including any
reimbursement by means of concurrent Revolver Loans or by the application of LC
Collateral), such Revolver Lender shall (in all circumstances and without
set-off or counterclaim) pay to LC Issuer on demand, in immediately available
funds at LC Issuer's address for notices hereunder, such Revolver Lender's
Revolver Percentage Share of such Matured LC Obligation (or any portion thereof
which has not been reimbursed by Borrower). Each Revolver Lender's obligation to
pay LC Issuer pursuant to the terms of this subsection is irrevocable and
unconditional. If any amount required to be paid by any Revolver Lender to LC
Issuer pursuant to this subsection is paid by such Revolver Lender to LC Issuer
within three Business Days after the date such payment is due, LC Issuer shall
in addition to such amount be entitled to recover from such Revolver Lender, on
demand, interest thereon calculated from such due date at the Federal Funds
Rate. If any amount required to be paid by any Revolver Lender to LC Issuer
pursuant to this subsection is not paid by such Revolver Lender to LC Issuer
within three Business Days after the date such payment is due, LC Issuer shall
in addition to such amount be entitled to recover from such Lender, on demand,
interest thereon calculated from such due date at the Base Rate plus the Base
Rate Margin.

        (d)    Distributions to Participants.    Whenever LC Issuer has in
accordance with this section received from any Revolver Lender payment of such
Revolver Lender's Revolver Percentage Share of any Matured LC Obligation, if LC
Issuer thereafter receives any payment of such Matured LC Obligation or any
payment of interest thereon (whether directly from Borrower or by application of
LC Collateral or otherwise, and excluding only interest for any period prior to
LC Issuer's demand that such Revolver Lender make such payment of its Revolver
Percentage Share), LC Issuer will distribute to such Revolver Lender its
Revolver Percentage Share of the amounts so received by LC Issuer; provided,
however, that if any such payment received by LC Issuer must thereafter be
returned by LC Issuer, such Revolver Lender shall return to LC Issuer the
portion thereof which LC Issuer has previously distributed to it.

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        (e)    Calculations.    A written advice setting forth in reasonable
detail the amounts owing under this section, submitted by LC Issuer to Borrower
or any Revolver Lender from time to time, shall be conclusive, absent manifest
error, as to the amounts thereof.

        Section 2.10.    No Duty to Inquire.    

        (a)    Drafts and Demands.    LC Issuer is authorized and instructed to
accept and pay drafts and demands for payment under any Letter of Credit without
requiring, and without responsibility for, any determination as to the existence
of any event giving rise to said draft, either at the time of acceptance or
payment or thereafter. LC Issuer is under no duty to determine the proper
identity of anyone presenting such a draft or making such a demand (whether by
tested telex or otherwise) as the officer, representative or agent of any
beneficiary under any Letter of Credit, and payment by LC Issuer to any such
beneficiary when requested by any such purported officer, representative or
agent is hereby authorized and approved. Borrower releases each Lender Party
from, and agrees to hold each Lender Party harmless and indemnified against, any
liability or claim in connection with or arising out of the subject matter of
this section, WHICH INDEMNITY SHALL APPLY WHETHER OR NOT ANY SUCH LIABILITY OR
CLAIM IS IN ANY WAY OR TO ANY EXTENT CAUSED, IN WHOLE OR IN PART, BY ANY
NEGLIGENT ACT OR OMISSION OF ANY KIND BY ANY LENDER PARTY, provided only that no
Lender Party shall be entitled to indemnification for that portion, if any, of
any liability or claim which is proximately caused by its own individual gross
negligence or willful misconduct, as determined in a final judgment.

        (b)    Extension of Maturity.    If the maturity of any Letter of Credit
is extended by its terms or by Law or governmental action, if any extension of
the maturity or time for presentation of drafts or any other modification of the
terms of any Letter of Credit is made at the request of Borrower, or if the
amount of any Letter of Credit is increased at the request of Borrower, this
Agreement shall be binding upon all Restricted Persons with respect to such
Letter of Credit as so extended, increased or otherwise modified, with respect
to drafts and property covered thereby, and with respect to any action taken by
LC Issuer, LC Issuer's correspondents, or any Lender Party in accordance with
such extension, increase or other modification.

        (c)    Transferees of Letters of Credit.    If any Letter of Credit
provides that it is transferable, LC Issuer shall have no duty to determine the
proper identity of anyone appearing as transferee of such Letter of Credit, nor
shall LC Issuer be charged with responsibility of any nature or character for
the validity or correctness of any transfer or successive transfers, and payment
by LC Issuer to any purported transferee or transferees as determined by LC
Issuer is hereby authorized and approved, and Borrower releases each Lender
Party from, and agrees to hold each Lender Party harmless and indemnified
against, any liability or claim in connection with or arising out of the
foregoing, WHICH INDEMNITY SHALL APPLY WHETHER OR NOT ANY SUCH LIABILITY OR
CLAIM IS IN ANY WAY OR TO ANY EXTENT CAUSED, IN WHOLE OR IN PART, BY ANY
NEGLIGENT ACT OR OMISSION OF ANY KIND BY ANY LENDER PARTY, provided only that no
Lender Party shall be entitled to indemnification for that portion, if any, of
any liability or claim which is proximately caused by its own individual gross
negligence or willful misconduct, as determined in a final judgment.

        Section 2.11.    LC Collateral.    

        (a)    LC Obligations in Excess of Maximum Revolver Facility
Amount.    If, after the making of all mandatory prepayments required under
Section 2.6, the outstanding LC Obligations will exceed the Maximum Revolver
Facility Amount, then in addition to prepayment of the entire principal balance
of the Loans Borrower will immediately pay to LC Issuer an amount equal to such
excess. LC Issuer will hold such amounts as collateral security for the
remaining LC Obligations (all such amounts held as collateral security for LC
Obligations being herein collectively called "LC Collateral") and the other
Obligations, and such collateral may be applied from time to time to pay Matured
LC Obligations or any other Obligations which are then due and payable. Neither
this subsection nor the following

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subsection shall, however, limit or impair any rights which LC Issuer may have
under any other document or agreement relating to any Letter of Credit, LC
Collateral or LC Obligation, including any LC Application, or any rights which
any Lender Party may have to otherwise apply any payments by Borrower and any LC
Collateral under Section 3.1.

        (b)    Acceleration of LC Obligations.    If the Obligations or any part
thereof become immediately due and payable pursuant to Section 8.1 then, unless
all Revolver Lenders otherwise specifically elect to the contrary (which
election may thereafter be retracted by all Revolver Lenders at any time), all
LC Obligations shall become immediately due and payable without regard to
whether or not actual drawings or payments on the Letters of Credit have
occurred, and Borrower shall be obligated to pay to LC Issuer immediately an
amount equal to the aggregate LC Obligations which are then outstanding to be
held as LC Collateral.

        (c)    Investment of LC Collateral.    Pending application thereof, all
LC Collateral shall be invested by LC Issuer in such Cash Equivalents as LC
Issuer may choose in its sole discretion. All interest on (and other proceeds
of) such Investments shall be reinvested or applied to Matured LC Obligations or
other Obligations which are due and payable. When all Obligations have been
satisfied in full, including all LC Obligations, all Letters of Credit have
expired or been terminated, and all of Borrower's reimbursement obligations in
connection therewith have been satisfied in full, LC Issuer shall release any
remaining LC Collateral. Borrower hereby assigns and grants to LC Issuer for the
benefit of Revolver Lenders a continuing security interest in all LC Collateral
paid by it to LC Issuer, all Investments purchased with such LC Collateral, and
all proceeds thereof to secure its Matured LC Obligations and its Obligations
under this Agreement, each Note, and the other Loan Documents, and Borrower
agrees that such LC Collateral, Investments and proceeds shall be subject to all
of the terms and conditions of the Security Documents. Borrower further agrees
that LC Issuer shall have all of the rights and remedies of a secured party
under the UCC with respect to such security interest and that an Event of
Default under this Agreement shall constitute a default for purposes of such
security interest.

        (d)    Payment of LC Collateral.    When Borrower is required to provide
LC Collateral for any reason and fails to do so on the day when required, LC
Issuer or Administrative Agent may without prior notice to Borrower or any other
Restricted Person provide such LC Collateral (whether by transfers from other
accounts maintained with LC Issuer, or otherwise) using any available funds of
Borrower or any other Person also liable to make such payments, and LC Issuer or
Administrative Agent will give notice thereof to Borrower promptly after such
application or transfer. Any such amounts which are required to be provided as
LC Collateral and which are not provided on the date required shall, for
purposes of each Security Document, be considered past due Obligations owing
hereunder, and LC Issuer is hereby authorized to exercise its respective rights
under each Security Document to obtain such amounts.

        Section 2.12.    Interest Rates and Fees; Reduction in Commitment.    

        (a)    Interest Rates.    Unless the Default Rate shall apply, (i) each
Base Rate Loan shall bear interest on each day outstanding at the Base Rate plus
the applicable Base Rate Margin in effect on such day and (ii) each LIBOR Loan
shall bear interest on each day during the related Interest Period at the
related LIBOR Rate plus the applicable LIBOR Rate Margin in effect on such day.
During a Default Rate Period, all Loans shall bear interest on each day
outstanding at the applicable Default Rate. The interest rate shall change
whenever the applicable Base Rate, the applicable Base Rate Margin, the
applicable LIBOR Rate or the applicable LIBOR Rate Margin changes. In no event
shall the interest rate on any Loan exceed the Highest Lawful Rate.

        (b)    Commitment Fees.    In consideration of each Revolver Lender's
commitment to make Revolver Loans, Borrower will pay to Administrative Agent for
the account of each Revolver Lender a commitment fee determined on a daily basis
equal to the Commitment Fee Rate in effect on such day

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times such Revolver Lender's Revolver Percentage Share of the unused portion of
the Maximum Revolver Facility Amount on each day during the Commitment Period,
determined for each such day by deducting from the amount of the Maximum
Revolver Facility Amount at the end of such day the Revolver Facility Usage.
This commitment fee shall be due and payable in arrears on the last day of each
Fiscal Quarter and at the end of the Commitment Period. Borrower shall have the
right from time to time to permanently reduce the Maximum Revolver Facility
Amount, provided that (i) notice of such reduction is given not less than two
Business Days prior to such reduction, (ii) the resulting Maximum Revolver
Facility Amount is not less than the Revolver Facility Usage, and (iii) each
partial reduction shall be in an amount at least equal to $1,000,000 and in
multiples of $500,000 in excess thereof.

        (c)    Letter of Credit Fees.    In consideration of LC Issuer's
issuance of any Letter of Credit, Borrower agrees to pay to Administrative
Agent, for the account of all Revolver Lenders in accordance with their
respective Revolver Percentage Shares, a letter of credit fee equal to the
Letter of Credit Fee Rate applicable each day times the face amount of such
Letter of Credit. Such fee will be calculated on the face amount of each Letter
of Credit outstanding on each day at the above applicable rates and will be
payable in arrears on the last day of each Fiscal Quarter. In addition, Borrower
will pay to LC Issuer a minimum administrative issuance fee equal to the greater
of $150 or one-eighth percent (0.125%) per annum of the face amount of each
letter of credit and such other fees and charges customarily charged by the LC
Issuer in respect of any issuance, amendment or negotiation of any Letter of
Credit in accordance with the LC Issuer's published schedule of such charges
effective as of the date of such amendment or negotiation.

        (d)    Administrative Agent's Fees.    In addition to all other amounts
due to Administrative Agent under the Loan Documents, Borrower will pay fees to
Administrative Agent as described in a letter agreement dated as of June 20,
2002 between Administrative Agent and Borrower.

        Section 2.13    Repayment of Term Loans.    Borrower shall repay to the
Administrative Agent, without premium, for the ratable account of the Term
Lenders the aggregate outstanding principal amount of the Term Loans as follows:

        (a)  On the last Business Day of each Fiscal Quarter during the period
from and including the last Business Day of September 2005 through and including
the last Business Day of June 2008, Borrower shall pay an aggregate principal
amount equal to $562,500;

        (b)  On the Term Loan Maturity Date, Borrower shall pay the remaining
aggregate principal amount of the Term Loans outstanding on such date; and

        (c)  Each such payment of principal on the Term Loans shall be
accompanied by interest then accrued and unpaid on the principal so paid.

ARTICLE III—Payments to Lenders

        Section 3.1.    General Procedures.    Borrower will make each payment
which it owes under the Loan Documents to Administrative Agent for the account
of the Lender Party to whom such payment is owed in lawful money of the United
States of America, (unless otherwise expressly provided in this Agreement),
without set-off, deduction or counterclaim, and in immediately available funds.
Each such payment must be received by Administrative Agent not later than
2:00 p.m., Boston, Massachusetts time, on the date such payment becomes due and
payable. Any payment received by Administrative Agent after such time will be
deemed to have been made on the next following Business Day. Should any such
payment become due and payable on a day other than a Business Day, the maturity
of such payment shall be extended to the next succeeding Business Day, and, in
the case of a payment of principal or past due interest, interest shall accrue
and be payable thereon for the period of such extension as provided in the Loan
Document under which such payment is due. Each payment under a

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Loan Document shall be due and payable at the place provided therein and, if no
specific place of payment is provided, shall be due and payable at the place of
payment of Administrative Agent's Note. When Administrative Agent collects or
receives money on account of the Obligations, Administrative Agent shall
promptly distribute all money so collected or received, and each Lender Party
shall apply all such money so distributed, (a) if such payment is in respect of
the Obligations then due and payable hereunder and under the Notes to more than
one of the Lender Parties, to such Lender Parties for the accounts of their
respective Applicable Lending Offices in accordance with their respective
Percentage Shares of the amounts of such Obligations due and payable to such
Lender Parties at such time and (b) if such payment is in respect of any of the
Obligations then due and payable hereunder to one Lender Party, to such Lender
Party for the account of its Applicable Lending Office, in each case to be
applied in such order as follows:

        (a)  first, for the payment of all Obligations which are then due (and
if such money is insufficient to pay all such Obligations, first to any
reimbursements due Administrative Agent under Section 6.9 or 10.4 and then to
the partial payment of all other Obligations then due in proportion to the
amounts thereof, or as Lender Parties shall otherwise agree);

        (b)  then for the prepayment of amounts owing under the Loan Documents
(other than principal on the Notes) if so specified by Borrower;

        (c)  then for the prepayment of principal on the Notes, together with
accrued and unpaid interest on the principal so prepaid, and then held as LC
Collateral pursuant to Section 2.11(c); and

        (d)  last, for the payment or prepayment of any other Obligations.

All payments applied to principal or interest on any Note shall be applied first
to any interest then due and payable, then to principal then due and payable,
and last to any prepayment of principal and accrued interest thereon in
compliance with Sections 2.5 and 2.6, as applicable. All distributions of
amounts described in any of subsections (b), (c) or (d) above shall be made by
Administrative Agent pro rata to each Lender Party then owed Obligations
described in such subsection in proportion to all amounts owed to all Lender
Parties which are described in such subsection; provided that if any Lender then
owes payments to LC Issuer for the purchase of a participation under
Section 2.9(c) or to Administrative Agent under Section 9.4, any amounts
otherwise distributable under this section to such Lender shall be deemed to
belong to LC Issuer or Administrative Agent, respectively, to the extent of such
unpaid payments, and Administrative Agent shall apply such amounts to make such
unpaid payments rather than distribute such amounts to such Lender.

        Section 3.2.    Capital Reimbursement.    If either (a) the introduction
or implementation of or the compliance with or any change in or in the
interpretation of any Law, or (b) the introduction or implementation of or the
compliance with any request, directive or guideline from any central bank or
other governmental authority (whether or not having the force of Law) affects or
would affect the amount of capital required or expected to be maintained by any
Lender Party or any corporation controlling any Lender Party, then, within five
Business Days after demand by such Lender Party, Borrower will pay to
Administrative Agent for the benefit of such Lender Party, from time to time as
specified by such Lender Party, such additional amount or amounts which such
Lender Party shall reasonably determine to be appropriate to compensate such
Lender Party or any corporation controlling such Lender Party (on an after-tax
basis, taking into account any taxes on such compensation) in light of such
circumstances, to the extent that such Lender Party reasonably determines that
the amount of any such capital would be increased or the rate of return on any
such capital would be reduced by or in whole or in part based on the existence
of the face amount of such Lender Party's Loans, Letters of Credit,
participations in Letters of Credit or commitments under this Agreement.

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        Section 3.3.    Increased Cost of LIBOR Loans or Letters of
Credit.    If any applicable Law (whether now in effect or hereinafter enacted
or promulgated, including Regulation D) or any interpretation or administration
thereof by any governmental authority charged with the interpretation or
administration thereof (whether or not having the force of Law):

        (a)  shall change the basis of taxation of payments to any Lender Party
of any principal, interest, or other amounts attributable to any LIBOR Loan or
Letter of Credit or otherwise due under this Agreement in respect of any LIBOR
Loan or Letter of Credit (other than taxes imposed on, or measured by, the
overall net income of such Lender Party or any Applicable Lending Office of such
Lender Party by any jurisdiction in which such Lender Party or any such
Applicable Lending Office is located); or

        (b)  shall change, impose, modify, apply or deem applicable any reserve,
special deposit or similar requirements in respect of any LIBOR Loan or any
Letter of Credit (excluding those for which such Lender Party is fully
compensated pursuant to adjustments made in the definition of LIBOR Rate) or
against assets of, deposits with or for the account of, or credit extended by,
such Lender Party; or

        (c)  shall impose on any Lender Party or the interbank eurocurrency
deposit market any other condition affecting any LIBOR Loan or Letter of Credit,
the result of which is to increase the cost to any Lender Party of funding or
maintaining any LIBOR Loan or of issuing any Letter of Credit or to reduce the
amount of any sum receivable by any Lender Party in respect of any LIBOR Loan or
Letter of Credit by an amount deemed by such Lender Party to be material,

then such Lender Party shall promptly notify Administrative Agent and Borrower
in writing of the happening of such event and of the amount required to
compensate such Lender Party for such event (on an after-tax basis, taking into
account any taxes on such compensation), whereupon (i) Borrower shall, within
five Business Days after demand therefor by such Lender Party, pay such amount
to Administrative Agent for the account of such Lender Party and (ii) Borrower
may elect, by giving to Administrative Agent and such Lender Party not less than
three Business Days' notice, to Convert all (but not less than all) of any such
LIBOR Loans into Base Rate Loans.

        Section 3.4.    Notice; Change of Applicable Lending Office.    A Lender
Party shall notify Borrower of any event occurring after the date of this
Agreement that will entitle such Lender Party to compensation under Section 3.2,
3.3 or 3.5 hereof as promptly as practicable, but in any event within 90 days,
after such Lender Party obtains actual knowledge thereof; provided, that (i) if
such Lender Party fails to give such notice within 90 days after it obtains
actual knowledge of such an event, such Lender Party shall, with respect to
compensation payable pursuant to Section 3.2, 3.3 or 3.5 in respect of any costs
resulting from such event, only be entitled to payment under Section 3.2, 3.3 or
3.5 hereof for costs incurred from and after the date 90 days prior to the date
that such Lender Party does give such notice and (ii) such Lender Party will
designate a different Applicable Lending Office for the Loans affected by such
event if such designation will avoid the need for, or reduce the amount of, such
compensation and will not, in the sole opinion of such Lender Party, be
disadvantageous to such Lender Party, except that such Lender Party shall have
no obligation to designate an Applicable Lending Office located in the United
States of America. Each Lender Party will furnish to Borrower a certificate
setting forth the basis and amount of each request by such Lender Party for
compensation under Section 3.2, 3.3 or 3.5 hereof.

        Section 3.5.    Availability.    If (a) any change in applicable Laws,
or in the interpretation or administration thereof of or in any jurisdiction
whatsoever, domestic or foreign, shall make it unlawful or impracticable for any
Lender Party to fund or maintain LIBOR Loans or to issue or participate in
Letters of Credit, or shall materially restrict the authority of any Lender
Party to purchase or take offshore deposits of dollars (i.e., "eurodollars"), or
(b) any Lender Party determines that matching deposits appropriate to fund or
maintain any LIBOR Loan are not available to it, or (c) any Lender

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Party determines that the formula for calculating the LIBOR Rate does not fairly
reflect the cost to such Lender Party of making or maintaining loans based on
such rate, then, upon notice by such Lender Party to Borrower and Administrative
Agent, Borrower's right to elect LIBOR Loans from such Lender Party (or, if
applicable, to obtain Letters of Credit) shall be suspended to the extent and
for the duration of such illegality, impracticability or restriction and all
LIBOR Loans of such Lender Party which are then outstanding or are then the
subject of any Borrowing Notice and which cannot lawfully or practicably be
maintained or funded shall immediately become or remain, or shall be funded as,
Base Rate Loans of such Lender Party. Borrower agrees to indemnify each Lender
Party and hold it harmless against all costs, expenses, claims, penalties,
liabilities and damages which may result from any such change in Law,
interpretation or administration. Such indemnification shall be on an after-tax
basis, taking into account any taxes imposed on the amounts paid as indemnity.

        Section 3.6.    Funding Losses.    In addition to its other obligations
hereunder, Borrower will indemnify each Lender Party against, and reimburse each
Lender Party on demand for, any loss or expense incurred or sustained by such
Lender Party (including any loss or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by a Lender
Party to fund or maintain LIBOR Loans), as a result of (a) any payment or
prepayment (whether or not authorized or required hereunder) of all or a portion
of a LIBOR Loan on a day other than the day on which the applicable Interest
Period ends, (b) any payment or prepayment, whether or not required hereunder,
of a Loan made after the delivery, but before the effective date, of a
Continuation/Conversion Notice, if such payment or prepayment prevents such
Continuation/Conversion Notice from becoming fully effective, (c) the failure of
any Loan to be made or of any Continuation/Conversion Notice to become effective
due to any condition precedent not being satisfied or due to any other action or
inaction of any Restricted Person, or (d) any Conversion (whether or not
authorized or required hereunder) of all or any portion of any LIBOR Loan into a
Base Rate Loan or into a different LIBOR Loan on a day other than the day on
which the applicable Interest Period ends. Such indemnification shall be on an
after-tax basis, taking into account any taxes imposed on the amounts paid as
indemnity.

        Section 3.7.    Reimbursable Taxes.    Borrower covenants and agrees
that:

        (a)  Borrower will indemnify each Lender Party against and reimburse
each Lender Party for all present and future stamp and other taxes, duties,
levies, imposts, deductions, charges, costs, and withholdings whatsoever
imposed, assessed, levied or collected on or in respect of this Agreement or any
LIBOR Loans or Letters of Credit (whether or not legally or correctly imposed,
assessed, levied or collected), excluding, however, any taxes imposed on or
measured by the overall net income of Administrative Agent or such Lender Party
or any Applicable Lending Office of such Lender Party (or franchise or
equivalent taxes) by any jurisdiction in which such Lender Party or any such
Applicable Lending Office is located (all such non-excluded taxes, levies, costs
and charges being collectively called "Reimbursable Taxes" in this section).
Such indemnification shall be on an after-tax basis, taking into account any
taxes imposed on the amounts paid as indemnity.

        (b)  All payments on account of the principal of, and interest on, each
Lender Party's Loans and Note, and all other amounts payable by Borrower to any
Lender Party hereunder, shall be made in full without set-off or counterclaim
and shall be made free and clear of and without deductions or withholdings of
any nature by reason of any Reimbursable Taxes, all of which will be for the
account of Borrower. In the event of Borrower being compelled by Law to make any
such deduction or withholding from any payment to any Lender Party, Borrower
shall pay on the due date of such payment, by way of additional interest, such
additional amounts as are needed to cause the amount receivable by such Lender
Party after such deduction or withholding to equal the amount which would have
been receivable in the absence of such deduction or withholding. If Borrower
should make any deduction or withholding as aforesaid, Borrower shall within
60 days thereafter forward to such Lender Party an official receipt or other
official document evidencing payment of such deduction or withholding.

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        (c)  If Borrower is ever required to pay any Reimbursable Tax with
respect to any LIBOR Loan, Borrower may elect, by giving to Administrative Agent
and such Lender Party not less than three Business Days' notice, to Convert all
(but not less than all) of any such LIBOR Loan into a Base Rate Loan, but such
election shall not diminish Borrower's obligation to pay all Reimbursable Taxes.

        (d)  Notwithstanding the foregoing provisions of this section, Borrower
shall be entitled, to the extent it is required to do so by Law, to deduct or
withhold (and not to make any indemnification or reimbursement for) income or
other similar taxes imposed by the United States of America (other than any
portion thereof attributable to a change in federal income tax Laws effected
after the date hereof) from interest, fees or other amounts payable hereunder
for the account of any Lender Party, other than a Lender Party (i) who is a U.S.
person for Federal income tax purposes or (ii) who has the Prescribed Forms on
file with Administrative Agent (with copies provided to Borrower) for the
applicable year to the extent deduction or withholding of such taxes is not
required as a result of the filing of such Prescribed Forms, provided that if
Borrower shall so deduct or withhold any such taxes, it shall provide a
statement to Administrative Agent and such Lender Party, setting forth the
amount of such taxes so deducted or withheld, the applicable rate and any other
information or documentation which such Lender Party may reasonably request for
assisting such Lender Party to obtain any allowable credits or deductions for
the taxes so deducted or withheld in the jurisdiction or jurisdictions in which
such Lender Party is subject to tax. As used in this section, "Prescribed Forms"
means such duly executed forms or statements, and in such number of copies,
which may, from time to time, be prescribed by Law and which, pursuant to
applicable provisions of (x) an income tax treaty between the United States and
the country of residence of the Lender Party providing the forms or statements,
(y) the Code, or (z) any applicable rules or regulations thereunder, permit
Borrower to make payments hereunder for the account of such Lender Party free of
such deduction or withholding of income or similar taxes.

        Section 3.8.    Replacement of Lenders.    If any Lender Party seeks
reimbursement for increased costs under Sections 3.2 through 3.7, then within
ninety days thereafter—provided no Event of Default then exists—Borrower shall
have the right (unless such Lender Party withdraws its request for additional
compensation) to replace such Lender Party by requiring such Lender Party to
assign its Loans and Notes and its commitments hereunder to an Eligible
Transferee reasonably acceptable to Administrative Agent and to Borrower,
provided that: (i) all Obligations of Borrower owing to such Lender Party being
replaced (including such increased costs and any breakage costs with respect to
any outstanding LIBOR Loans), but excluding principal and accrued interest on
the Notes being assigned) shall be paid in full to such Lender Party
concurrently with such assignment, and (ii) the replacement Eligible Transferee
shall purchase the Note being assigned by paying to such Lender Party a price
equal to the principal amount thereof plus accrued and unpaid interest and
accrued and unpaid commitment fees thereon. In connection with any such
assignment Borrower, Administrative Agent, such Lender Party and the replacement
Eligible Transferee shall otherwise comply with Section 10.5. Notwithstanding
the foregoing rights of Borrower under this section, however, Borrower may not
replace any Lender Party which seeks reimbursement for increased costs under
Section 3.2 through 3.7 unless Borrower is at the same time replacing all Lender
Parties which are then seeking such compensation.

ARTICLE IV—Conditions Precedent to Credit

        Section 4.1.    Documents to be Delivered.    No Lender has any
obligation to make its first Loan, and LC Issuer has no obligation to issue the
first Letter of Credit, unless Administrative Agent shall have received all of
the following, at Administrative Agent's office in Boston, Massachusetts (or at
such

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other place as Administrative Agent shall authorize), duly executed and
delivered and in form, substance and date satisfactory to Administrative Agent
and Arrangers:

        (a)  This Agreement and any other documents that Lenders are to execute
in connection herewith.

        (b)  Each Note.

        (c)  Each Security Document listed in the Security Schedule including
but not limited to each Guaranty and each Pledge Agreement listed thereon.

        (d)  Certain certificates including:

          (i)  A certificate of the secretary and of the chairman or the
president of General Partner, which shall contain the names and signatures of
the officers and other approved persons of General Partner authorized to execute
Loan Documents on behalf of Pacific Energy Partners, the sole member of
Borrower, and which shall certify to the truth, correctness and completeness of
the following exhibits attached thereto: (1) a copy of resolutions duly adopted
by the Board of Directors of General Partner and in full force and effect at the
time this Agreement is entered into, authorizing the execution of this Agreement
and the other Loan Documents delivered or to be delivered in connection herewith
on behalf of Pacific Energy Partners, the sole member of Borrower and the
consummation of the transactions contemplated herein and therein, (2) a copy of
the charter documents of the General Partner and all amendments thereto,
certified by the appropriate official of the General Partner's jurisdiction of
organization, (3) in its capacity as the general partner of Pacific Energy
Partners, a copy of the charter documents of Pacific Energy Partners and all
amendments thereto, certified by the appropriate official of Pacific Energy
Partner's jurisdiction of organization, (4) a copy of any bylaws of the General
Partner, and (5) in its capacity as the general partner of Pacific Energy
Partners, a copy of any agreement of limited partnership of Pacific Energy
Partners; and

        (ii)  A certificate of the Borrower and Pacific Energy Partners
regarding satisfaction of Section 4.2(a) through (c).

        (e)  A certificate (or certificates) of the due formation, valid
existence and good standing of each Related Person in its respective
jurisdiction of organization, issued by the appropriate authorities of such
jurisdiction, and certificates of each Related Person's good standing and due
qualification to do business, issued by appropriate officials in any
jurisdictions in which such Related Person owns property subject to Security
Documents.

        (f)    Documents similar to those specified in subsections (d)(i) and
(e) of this section with respect to Borrower and each Guarantor and the
execution by it of the Loan Documents to be executed by Borrower or such
Guarantor, as applicable.

        (g)  A favorable opinion of (i) Holme Roberts & Owen LLP, counsel to
Related Persons, in a form satisfactory to Administrative Agent and (ii) local
counsel for the states of California, Colorado, Montana, Utah and Wyoming in a
form satisfactory to Administrative Agent, in each case, in respect of
regulatory matters that Administrative Agent has reasonably requested.

        (h)  The Initial Financial Statements.

        (i)    Certificates or binders evidencing Related Persons' insurance in
effect on the date hereof.

        (j)    Copies of such permits and approvals regarding the property and
business of Related Persons as Administrative Agent may request.

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        (k)  A certificate of Borrower and Pacific Energy Partners in form and
detail acceptable to Administrative Agent confirming the insurance that is in
effect as of the date hereof and certifying that such insurance is customary for
the businesses conducted by Related Persons and is in compliance with the
requirements of this Agreement.

        (l)    Payment of all commitment, facility, agency and other fees
required to be paid to any Lender pursuant to any Loan Documents or any
commitment agreement heretofore entered into.

        (m)  Borrower and Pacific Energy Partners shall have delivered to
Administrative Agent a certificate certifying the Initial Financial Statements
delivered pursuant to clause (h) above and reflecting compliance with each event
specified in Sections 7.10 through 7.12, inclusive.

        (n)  Borrower and Pacific Energy Partners shall have delivered to
Administrative Agent a certificate certifying that the documents attached
thereto are true and correct copies of (i) the Omnibus Agreement (as defined in
the Pacific Energy Partners Registration Statement) and each other material
agreement between any Restricted Person and any Affiliate of a Restricted Person
and (ii) the EPTC Acquisition Documents, in each case, in the form existing on
the Closing Date.

        (o)  Pacific Energy Partners shall have consummated the public offering
of its common units resulting in gross proceeds of at least $165,000,000;
provided that, if the proceeds of such public offering are less than
$170,000,000, then the payment to be made in consideration of the assets and
liabilities contributed to Borrower by the General Partner and its Affiliates as
provided in the "Use of Proceeds" section of the Pacific Energy Partners
Registration Statement shall be reduced by an amount equal to the amount by
which such proceeds are less than $170,000,000.

        (p)  The applicable Borrower Debt Rating shall either (i) be equal to or
more favorable than BBB- by S&P or (ii) be equal to or more favorable than Baa3
by Moody's.

        Section 4.2.    Additional Conditions Precedent.    No Lender has any
obligation to make any Loan (including its first), and LC Issuer has no
obligation to issue any Letter of Credit (including its first), unless the
following conditions precedent have been satisfied:

        (a)  All representations and warranties made by any Restricted Person in
any Loan Document shall be true on and as of the date of such Loan or the date
of issuance of such Letter of Credit as if such representations and warranties
had been made as of the date of such Loan or the date of issuance of such Letter
of Credit except to the extent that such representation or warranty was made as
of a specific date or updated, modified or supplemented as of a subsequent date
with the consent of Majority Lenders.

        (b)  No Default shall exist at the date of such Loan or the date of
issuance of such Letter of Credit.

        (c)  No Material Adverse Change shall have occurred to, and no event or
circumstance shall have occurred that could reasonably be expected to cause a
Material Adverse Change to, Pacific Energy Partners' or Borrower's Consolidated
(or combined, if applicable) financial condition or businesses since the date of
the Initial Financial Statements.

        (d)  The making of such Loan or the issuance of such Letter of Credit
shall not be prohibited by any Law and shall not subject any Lender or any LC
Issuer to any penalty or other onerous condition under or pursuant to any such
Law.

        (e)  The Administrative Agent shall have received, in form and substance
satisfactory to it, such other assurances, documents or consents related to the
foregoing as the Administrative Agent or the Majority Lenders reasonably may
require.

        Section 4.3.    Conditions Precedent to Non-Working Capital Loans.    No
Revolver Lender has any obligation to make any Revolver Loan, other than Working
Capital Loans, unless either (i) the

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Borrower has notified the Revolver Lenders that the EPTC Acquisition will not be
consummated and has specified in the related Borrowing Notice the purpose of
such Revolver Loan or (ii) the following conditions precedent have been
satisfied prior to or contemporaneously with the consummation of the EPTC
Acquisition:

        (a)  All of the transactions contemplated by the EPTC Acquisition
Documents shall have been consummated, substantially as contemplated thereby and
in material compliance with the terms and conditions thereof.

        (b)  All representations and warranties made by any party to the EPTC
Acquisition Documents shall be true and correct in all material respects.

        (c)  After giving effect to each of the transactions under the EPTC
Acquisition Documents, all representations and warranties made in any Loan
Document shall be true on and as of such date as if such representations and
warranties have been made as of the date thereof and each Related Person shall
be in compliance with each covenant by or relating to such Related Person
contained in any Loan Document.

        (d)  Administrative Agent shall have received a certificate of Borrower
confirming compliance with the requirements of Section 4.3(a) and (c).

        (e)  Administrative Agent shall have received copies of each Acquisition
Document.

In the event of a Permitted Acquisition representing all or part of the assets
contemplated by the EPTC Acquisition Documents but on terms not substantially as
contemplated by the EPTC Acquisition Documents then, unless such revised terms
have been approved by Majority Lenders as constituting the EPTC Acquisition, the
EPTC Acquisition Period shall not occur upon such Permitted Acquisition and such
Permitted Acquisition shall not be subject to the conditions of Section 4.3(a)
through (e).

ARTICLE V—Representations and Warranties

        To confirm each Lender's understanding concerning Related Persons and
Related Persons' businesses, properties and obligations and to induce each
Lender to enter into this Agreement and to extend credit hereunder, Pacific
Energy Partners and Borrower represent and warrant to each Lender that:

        Section 5.1.    No Default.    No Related Person is in default in the
performance of any of the covenants and agreements by or relating to such
Related Person contained in any Loan Document. No event has occurred and is
continuing which constitutes a Default.

        Section 5.2.    Organization and Good Standing.    Each Related Person
is duly organized, validly existing and in good standing under the Laws of its
jurisdiction of organization, having all powers required to carry on its
business and enter into and carry out the transactions contemplated hereby. Each
Related Person is duly qualified, in good standing, and authorized to do
business in all other jurisdictions wherein the character of the properties
owned or held by it or the nature of the business transacted by it makes such
qualification necessary except where the failure to so qualify would not
reasonably be expected to cause a Material Adverse Change.

        Section 5.3.    Authorization.    Each Restricted Person has duly taken
all action necessary to authorize the execution and delivery by it of the Loan
Documents to which it is a party and to authorize the consummation of the
transactions contemplated thereby and the performance of its obligations
thereunder. Borrower is duly authorized to borrow funds hereunder.

        Section 5.4.    No Conflicts or Consents.    Except as disclosed in the
Disclosure Schedule, the execution and delivery by the various Restricted
Persons of the Loan Documents to which each is a party, the performance by each
of its obligations under such Loan Documents, and the consummation

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of the transactions contemplated by the various Loan Documents, do not and will
not conflict with any provision of any Law, the organizational documents of any
Related Person or General Partner, or any material agreement, judgment, license,
order or permit applicable to or binding upon any Related Person or General
Partner, result in the acceleration of any Indebtedness owed by any Related
Person or General Partner, or result in or require the creation of any Lien upon
any assets or properties of any Related Person except as expressly contemplated
in the Loan Documents. Except as expressly contemplated in the Loan Documents or
disclosed in the Disclosure Schedule and except that any exercise by the Lenders
of their respective rights and remedies with respect to the Collateral or any
other action taken or proposed to be taken by the Lenders hereunder or under the
other Loan Documents that would result in a change of control of any PUC
Restricted Subsidiary shall be subject to such filings with and prior approval
by the applicable PUC as may be required in respect of a regulated utility under
such agency's regulations, no permit, consent, approval, authorization or order
of, and no notice to or filing, registration or qualification with, any Tribunal
or third party is required in connection with the execution, delivery or
performance by any Restricted Person of any Loan Document or to consummate any
transactions contemplated by the Loan Documents.

        Section 5.5.    Enforceable Obligations.    This Agreement is, and the
other Loan Documents when duly executed and delivered will be, legal, valid and
binding obligations of each Restricted Person which is a party hereto or
thereto, enforceable in accordance with their terms except as such enforcement
may be limited by bankruptcy, insolvency or similar Laws of general application
relating to the enforcement of creditors' rights.

        Section 5.6.    Initial Financial Statements.    Pacific Energy Partners
and Borrower have heretofore delivered to each Lender true, correct and complete
copies of the Initial Financial Statements. The Initial Financial Statements of
Pacific Energy (Predecessor) fairly present the combined financial position of
Pacific Energy (Predecessor) and the combined results of operations of, cash
flows of and parent investment in Pacific Energy (Predecessor) for the periods
thereof, for such entities and such manner as is set forth in the notes thereto.
The Initial Financial Statements of Pacific Energy Partners and the General
Partner as of March 31, 2002 fairly present the respective combined financial
positions for Borrower and General Partner at the date thereof and their
respective results of operations for the periods thereof. Since the date of the
annual Initial Financial Statements as of December 31, 2001, no Material Adverse
Change has occurred, except as reflected in the quarterly Initial Financial
Statements of Pacific Energy Partners or in the Disclosure Schedule. The
financial statements from which the pro forma Initial Financial Statements of
Pacific Energy Partners were derived, were prepared in accordance with GAAP,
with such pro forma adjustments as have been disclosed in the notes thereto.

        Section 5.7.    Other Obligations and Restrictions.    No Restricted
Person has any outstanding Liabilities of any kind (including contingent
obligations, tax assessments, and unusual forward or long-term commitments, but
excluding contractual obligations that are not required to be disclosed under
GAAP in the balance sheet or the footnotes thereto) which are, in the aggregate,
material to Pacific Energy Partners or Borrower or material with respect to
Pacific Energy Partners' or Borrower's Consolidated financial condition and not
shown or reflected in the Initial Financial Statements, disclosed in the
Disclosure Schedule or otherwise permitted under Section 7.1. Except as shown in
the Initial Financial Statements or disclosed in the Disclosure Schedule, no
Related Person is subject to or restricted by any franchise, contract, deed,
charter restriction, or other instrument or restriction which could reasonably
be expected to cause a Material Adverse Change.

        Section 5.8.    Full Disclosure.    No certificate, statement or other
written information (taken as a whole) delivered herewith or heretofore by any
Related Person to any Lender in connection with the negotiation of this
Agreement or in connection with any transaction contemplated hereby, including
but not limited to the Pacific Energy Partners Registration Statement contains
and no certificate, statement or other written information (taken as a whole)
delivered hereafter by a Responsible Officer will contain any untrue statement
of a material fact or omits to state any material fact necessary to make

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the statements contained herein or therein, in light of the circumstances under
which they were made, not materially misleading as of the date made or deemed
made, provided that notwithstanding anything else contained in this Agreement,
none of the Related Persons make any representation, warranty, or guaranty as to
any projections furnished to the Administrative Agent or the Lenders (except
that such projections have been prepared by the applicable Related Person on the
basis of assumptions which were believed to be reasonable as of the date of such
projections in light of current business conditions). There is no fact known to
any Responsible Officer that is not shown in the Initial Financial Statements,
the Pacific Energy Partners Registration Statement disclosed in the Disclosure
Schedule or otherwise disclosed to the Lenders in writing which could, in such
Responsible Officer's reasonable judgment, cause a Material Adverse Change.

        Section 5.9.    Litigation.    Except as disclosed in the Initial
Financial Statements or in the Disclosure Schedule: (i) there are no actions,
suits or legal, equitable, arbitrative or administrative proceedings pending, or
to the knowledge of any Responsible Officer threatened, against any Related
Person or affecting any Collateral (including, without limitation, any which
challenge or otherwise pertain to any Restricted Person's title to any
Collateral) before any Tribunal which could reasonably be expected to cause a
Material Adverse Change, and (ii) there are no outstanding judgments,
injunctions, writs, rulings or orders by any such Tribunal against any Related
Person or any Related Person's stockholders, partners, directors or officers or
affecting any Collateral or any of its material assets or property which could
reasonably be expected to cause a Material Adverse Change.

        Section 5.10.    Labor Disputes and Acts of God.    Except as disclosed
in the Disclosure Schedule, neither the business nor the properties of any
Related Person has been affected by any fire, explosion, accident, strike,
lockout or other labor dispute, drought, storm, hail, earthquake, embargo, act
of God or of the public enemy or other casualty (whether or not covered by
insurance), which could reasonably be expected to cause a Material Adverse
Change.

        Section 5.11.    ERISA Plans and Liabilities.    All currently existing
ERISA Plans are listed in the Disclosure Schedule. Except as disclosed in the
Initial Financial Statements or in the Disclosure Schedule, no Termination Event
has occurred with respect to any ERISA Plan and all ERISA Affiliates are in
compliance with ERISA in all material respects. No ERISA Affiliate is required
to contribute to, or has any other absolute or contingent liability in respect
of, any "multiemployer plan" as defined in Section 4001 of ERISA. Except as set
forth in the Disclosure Schedule: (i) no "accumulated funding deficiency" (as
defined in Section 412(a) of the Code) exists with respect to any ERISA Plan,
whether or not waived by the Secretary of the Treasury or his delegate, and
(ii) the current value of each ERISA Plan's benefits does not exceed the current
value of such ERISA Plan's assets available for the payment of such benefits by
more than $10,000,000.

        Section 5.12.    Compliance with Laws.    Except as set forth in the
Disclosure Schedule, each Related Person has all permits, licenses and
authorizations required in connection with the conduct of its businesses, except
to the extent failure to have any such permit, license or authorization could
not reasonably be expected to cause a Material Adverse Change. Each Related
Person is in compliance with the terms and conditions of all such permits,
licenses and authorizations, and is also in compliance with all other
limitations, restrictions, conditions, standards, prohibitions, requirements,
obligations, schedules and timetables contained in any Law or in any regulation,
code, plan, order, decree, judgment, injunction, notice or demand letter issued,
entered, promulgated or approved thereunder, except to the extent failure to
comply could not reasonably be expected to cause a Material Adverse Change.
Without limiting the foregoing, except as set forth in the Disclosure Schedule,
each Related Person (i) has filed and maintained in all material respects all
tariffs applicable to its business with each applicable commission, (ii) and all
such tariffs are in material compliance with all Laws administered or
promulgated by each applicable commission and (iii) has imposed charges on its
customers in material compliance with such tariffs, all contracts applicable to
its business and all applicable Laws or otherwise in material compliance with
Law. As used herein, "commission" includes

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the Federal Energy Regulatory Commission and each other US federal, Canadian
federal, state, provincial, or local governmental department, commission, board,
bureau, agency or instrumentality having jurisdiction over any Related Person or
its properties.

        Section 5.13.    Environmental Laws.    As used in this section:
"CERCLA" means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, "CERCLIS" means the Comprehensive
Environmental Response, Compensation and Liability Information System List of
the Environmental Protection Agency, and "Release" has the meaning given such
term in 42 U.S.C. § 9601(22). Without limiting the provisions of Section 5.12
and except as set forth in the Disclosure Schedule:

        (a)  No notice, notification, demand, request for information, citation,
summons or order has been issued, no complaint has been filed, no penalty has
been assessed, and no investigation or review is pending or, to the knowledge of
a Responsible Officer, threatened by any Tribunal or any other Person with
respect to any of the following which in the aggregate could reasonably be
expected to cause a Material Adverse Change (i) any alleged generation,
treatment, storage, recycling, transportation, disposal, or Release of any
Hazardous Materials, either by any Related Person or on any property owned by
any Related Person, (ii) any remedial action which might be needed to respond to
any such alleged generation, treatment, storage, recycling, transportation,
disposal, or Release, or (iii) any alleged failure by any Related Person to have
any permit, license or authorization required in connection with the conduct of
its business or with respect to any such generation, treatment, storage,
recycling, transportation, disposal, or Release.

        (b)  No Related Person otherwise has any known material contingent
liability in connection with any alleged generation, treatment, storage,
recycling, transportation, disposal, or Release of any Hazardous Materials that
has caused, or could reasonably be expected to cause a Material Adverse Change.

        (c)  No Related Person has handled any Hazardous Materials, other than
as a generator, on any properties now or previously owned or leased by any
Related Person to an extent that such handling has caused, or could reasonably
be expected to cause, a Material Adverse Change.

        (d)  Except to the extent that the following in the aggregate has not
caused and could not reasonably be expected to cause a Material Adverse Change:

          (i)  no PCBs are or have been present at any properties now or
previously owned or leased by any Related Person;

        (ii)  no asbestos is or has been present at any properties now or
previously owned or leased by any Related Person;

        (iii)  there are no underground storage tanks for Hazardous Materials,
active or abandoned, at any properties now or previously owned or leased by any
Related Person; and

        (iv)  no Hazardous Materials have been Released at, on or under any
properties now or previously owned or leased by any Related Person.

        (e)  Except to the extent that has not caused and could not reasonably
be expected to cause a Material Adverse Change, no Related Person has
transported or arranged for the transportation of any Hazardous Material to any
location which is listed on the National Priorities List under CERCLA, any
location listed for possible inclusion on the National Priorities List by the
Environmental Protection Agency in CERCLIS nor any location listed on any
similar state list or which is the subject of federal, state or local
enforcement actions or other investigations which may lead to claims against any
Related Person for clean-up costs, remedial work, damages to natural resources
or for personal injury claims, including, but not limited to, claims under
CERCLA.

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        (f)    Except to the extent that has not caused and could not reasonably
be expected to cause a Material Adverse Change, no property now or previously
owned or leased by any Related Person is listed or proposed for listing on the
National Priority list promulgated pursuant to CERCLA, in CERCLIS nor on any
similar state list of sites requiring investigation or clean-up.

        (g)  There are no Liens arising under or pursuant to any Environmental
Laws on any of the real properties or properties owned or leased by any Related
Person, and no government actions of which Borrower is aware have been taken or
are in process which could subject any of such properties to such Liens; nor
would any Related Person be required to place any notice or restriction relating
to the presence of Hazardous Materials at any properties owned by it in any deed
to such properties.

        (h)  There have been no environmental investigations, studies, audits,
tests, reviews or other analyses for ground water or soil contamination relating
to the Release of Hazardous Materials conducted by or which are in the
possession of any Related Person in relation to any properties or facility now
or previously owned or leased by any Related Person which have not been made
available to Administrative Agent.

        (i)    (i) All Related Persons are conducting their businesses in
material compliance with all applicable Environmental Laws, and have and are in
compliance with all licenses and permits required under any such Laws, unless
failure to so comply could not reasonably be expected to cause a Material
Adverse Change; and (ii) no Related Person has filed any notice under any Law
indicating that any such Person is responsible for the improper release into the
environment, or the improper storage or disposal, of any material amount of any
Hazardous Materials or that any Hazardous Materials have been improperly
released, or are improperly stored or disposed of, upon any property of any such
Person, unless such failure to so comply could not reasonably be expected to
cause a Material Adverse Change.

For purposes of this Section 5.13, "Material Adverse Change" is deemed to mean
the incurrence of either of the following, to the extent such amounts are in
excess of available insurance by a financially sound insurer that has not
contested liability: (i) expenditures with respect to all matters referred to
under this Section 5.13 in excess of $10,000,000 in the aggregate in any Fiscal
Year or (ii) liabilities with respect to all matters referred to under this
Section 5.13 in excess of $30,000,000.

        Section 5.14.    Names and Places of Business.    No Restricted Person
has, during the preceding five years, had, been known by, or used any other
trade or fictitious name, except as disclosed in the Disclosure Schedule or
otherwise disclosed to Administrative Agent in writing. Except as otherwise
indicated in the Disclosure Schedule or otherwise disclosed to Administrative
Agent in writing, the chief executive office and principal place of business of
each Restricted Person are (and for the preceding five years have been) located
at the address of Borrower set out in Section 10.3. Except as indicated in the
Disclosure Schedule or otherwise disclosed in writing to the Administrative
Agent, no Restricted Person has any other office or place of business.

        Section 5.15.    Borrower's Subsidiaries.    Borrower does not presently
have any Subsidiary or own any stock in any other corporation or association
except those listed in the Disclosure Schedule or disclosed to Administrative
Agent in writing. Neither Borrower nor any Related Person is a member of any
general or limited partnership, limited liability company, joint venture or
association of any type whatsoever except those listed in the Disclosure
Schedule or disclosed to Administrative Agent in writing. Borrower owns,
directly or indirectly, the Equity Interest in each of its Subsidiaries which is
indicated in the Disclosure Schedule or as disclosed to Administrative Agent in
writing.

        Section 5.16.    Title to Properties; Licenses.    Each Restricted
Person has good title to, or valid leasehold interests in, all of the Collateral
owned or leased by such Restricted Person, all of its Systems and all of its
other material properties and assets necessary or used in the ordinary conduct
of its

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business, except for such defects in title as would not, individually or in the
aggregate, cause a Material Adverse Change, free and clear of all Liens other
than Permitted Liens and of all material impediments to the use of such
properties and assets in such Restricted Person's business. Notwithstanding the
foregoing, to the extent that the exercise by the Lenders of their respective
rights or remedies with respect to the Collateral or any other action taken or
proposed to be taken by the Lenders hereunder or under the other Loan Documents
would result in a change of control of any PUC Restricted Subsidiary, such
exercise is subject to filings with and prior approval by the applicable PUC as
may be required in respect of a regulated utility under such agency's
regulations. Each Restricted Person possesses or licenses all patents,
copyrights, trademarks and trade names, and other intellectual property (or
otherwise possesses the right to use such intellectual property without
violation of the rights of any other Person) which are necessary to carry out
its business as presently conducted and as presently proposed to be conducted
hereafter, and no Restricted Person is in violation in any material respect of
the terms under which it possesses such intellectual property or the right to
use such intellectual property.

        Section 5.17.    Government Regulation.    Except as disclosed in the
Disclosure Schedule, neither Borrower nor any other Related Person is subject to
regulation under the Public Utility Holding Company Act of 1935, the Federal
Power Act, the Investment Company Act of 1940 (as any of the preceding acts have
been amended) or any other Law which regulates the incurring by such Person of
Indebtedness, including Laws relating to common contract carriers or the sale of
electricity, gas, steam, water or other public utility services.    No Related
Person is subject to regulation under the Federal Power Act which would violate,
result in a default of, or prohibit the effectiveness or the performance of any
of the provisions of the Loan Documents.

        Section 5.18.    Insider.    No Related Person, nor any Person having
"control" (as that term is defined in 12 U.S.C. § 375b(9) or in regulations
promulgated pursuant thereto) of any Related Person, is a "director" or an
"executive officer" or "principal shareholder" (as those terms are defined in 12
U.S.C. § 375b(8) or (9) or in regulations promulgated pursuant thereto) of any
Lender, of a bank holding company of which any Lender is a Subsidiary or of any
Subsidiary of a bank holding company of which any Lender is a Subsidiary.

        Section 5.19.    Solvency.    Upon giving effect to the issuance of the
Notes, the execution of the Loan Documents by Borrower and each Guarantor and
the consummation of the transactions contemplated hereby, (i) Borrower and each
Guarantor will be solvent (as such term is used in applicable bankruptcy,
liquidation, receivership, insolvency or similar Laws), and the sum of
Borrower's and each Guarantor's absolute and contingent liabilities, including
the Obligations or guarantees thereof, shall not exceed the fair market value of
such Restricted Person's assets, and (ii) Borrower's and each Guarantor's
capital should be adequate for the businesses in which such Restricted Person is
engaged and intends to be engaged. Neither Borrower nor any Restricted Person
has incurred (whether under the Loan Documents or otherwise), nor does any
Restricted Person intend to incur or believe that it will incur, debts which
will be beyond its ability to pay as such debts mature.

ARTICLE VI—Affirmative Covenants

        To conform with the terms and conditions under which each Lender is
willing to have credit outstanding to Borrower, and to induce each Lender to
enter into this Agreement and extend credit hereunder, Pacific Energy Partners
and Borrower covenant and agree that until the full and final payment of the
Obligations and the termination of this Agreement, unless Majority Lenders, or
all Lenders as required under Section 10.1, have previously agreed otherwise:

        Section 6.1.    Payment and Performance.    Each Restricted Person will
pay all amounts due under the Loan Documents, to which it is a party, in
accordance with the terms thereof and will observe,

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perform and comply with every covenant, term and condition expressed in the Loan
Documents to which it is a party.

        Section 6.2.    Books, Financial Statements and Reports.    Each Related
Person will at all times maintain full and accurate books of account and
records. Pacific Energy Partners and Borrower will maintain and will cause their
Subsidiaries to maintain a standard system of accounting, will maintain its
Fiscal Year, and will furnish, at Related Person's expense, the following
statements and reports to Administrative Agent in electronic form or, if not in
electronic form, in sufficient copies for each Lender:

        (a)  As soon as available, and in any event within ninety (90) days
after the end of each Fiscal Year (i) complete Consolidated financial statements
of Pacific Energy Partners and of Borrower together with all notes thereto,
prepared in accordance with GAAP, together with an unqualified opinion, based on
an audit using generally accepted auditing standards, by KPMG LLP or any other
independent certified public accountants selected by General Partner and
acceptable to Majority Lenders, stating that such Consolidated financial
statements have been so prepared and (ii) unaudited consolidating financial
statements, which include the balance sheets and statements of income of each
Related Person prepared in accordance with GAAP. These financial statements
shall contain a Consolidated balance sheet as of the end of such Fiscal Year and
Consolidated statements of earnings for such Fiscal Year. Such Consolidated
financial statements shall set forth in comparative form the corresponding
figures for the preceding Fiscal Year. In addition, concurrent with the delivery
of such financial statements, Pacific Energy Partners and Borrower will furnish
to Administrative Agent a certificate signed by such accountants stating that in
connection with their audit, nothing came to their attention to cause them to
believe that Borrower or Pacific Energy Partners failed to comply with the
terms, covenants, provisions or conditions of Article VII insofar as they relate
to accounting matters, with the proviso that such audit was not directed
primarily toward obtaining knowledge of such non-compliance.

        (b)  As soon as available, and in any event within forty-five (45) days
after the end of each of the first three Fiscal Quarters of each Fiscal Year
(i) Pacific Energy Partners' and Borrower's Consolidated balance sheet as of the
end of such Fiscal Quarter and Consolidated statements of Pacific Energy
Partners' and Borrower's earnings and cash flows for such Fiscal Quarter and for
the period from the beginning of the then current Fiscal Year to the end of such
Fiscal Quarter, and (ii) unaudited consolidating financial statements, which
include the balance sheets and statements of income of each Related Person, all
prepared in accordance with GAAP, subject to changes resulting from normal
year-end adjustments. In addition Pacific Energy Partners and Borrower will,
together with each such set of financial statements and each set of financial
statements furnished under subsection (a) of this section, furnish a certificate
in the form of Exhibit D signed by the chief financial officer, principal
accounting officer or treasurer of General Partner stating that such financial
statements fairly present, in accordance with GAAP, the financial position and
results of operations of Pacific Energy Partners and Borrower as of the date
thereof (subject to normal year-end adjustments), stating that he has reviewed
the Loan Documents, containing calculations showing compliance (or
non-compliance) at the end of such Fiscal Quarter with the requirements of
Sections 7.10 through 7.12, inclusive and stating that to his or her knowledge
no Default exists at the end of such Fiscal Quarter or at the time of such
certificate or specifying the nature and period of existence of any such
Default.

        (c)  Promptly upon their becoming available, copies of all financial
statements, reports, notices and proxy statements sent by Pacific Energy
Partners to its unit holders and all registration statements, periodic reports
and other statements and schedules filed by Pacific Energy Partners with any
securities exchange, the Securities and Exchange Commission or any similar
governmental authority.

        (d)  As soon as available, and in any event within ninety (90) days
after the commencement of each Fiscal Year, a budget approved by the Board of
Directors of the General Partner for such Fiscal

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Year for Pacific Energy Partners and its Subsidiaries, prepared or caused to be
prepared by the chief financial officer, principal accounting officer or
treasurer of General Partner.

        Section 6.3.    Other Information and Inspections.    Each Related
Person will furnish to each Lender any information which Administrative Agent or
any Lender may from time to time request concerning any covenant, provision or
condition of the Loan Documents, any Collateral or any matter in connection with
Related Persons' businesses and operations. Each Related Person will permit
representatives appointed by Administrative Agent (including independent
accountants, auditors, agents, attorneys, appraisers and any other Persons) to
visit and inspect during normal business hours any of such Related Person's
property, including its books of account, other books and records, and any
facilities or other business assets, and to make extra copies therefrom and
photocopies and photographs thereof, and to write down and record any
information such representatives obtain, and each Related Person shall permit
Administrative Agent or its representatives to investigate and verify the
accuracy of the information furnished to Administrative Agent or any Lender in
connection with the Loan Documents and to discuss all such matters with its
executive officers and, upon prior notice to Borrower, its representatives (so
long as Borrowers' executive officers and other representatives are entitled to
be present). Administrative Agent and such representatives shall maintain the
confidentiality of all such information in accordance with Section 10.6.
Notwithstanding the foregoing or any other provision of this Agreement, in no
event shall Administrative Agent or its representatives, or Lenders or their
representatives, be entitled to any information or to review, inspect or copy
any document or record protected by the attorney/client privilege or work
product doctrine.

        Section 6.4.    Notice of Material Events and Change of
Address.    Borrower will notify each Lender Party, not later than seven
(7) Business Days after any executive officer of a Related Persons has knowledge
thereof, stating that such notice is being given pursuant to this Agreement, of:

        (a)  a determination by an executive officer that a Material Adverse
Change has occurred,

        (b)  the occurrence of any Default,

        (c)  the acceleration of the maturity of any Indebtedness owed by any
Related Person or of any default by any Related Person under any indenture,
mortgage, agreement, contract or other instrument to which any of them is a
party or by which any of them or any of their properties is bound, if such
acceleration or default could reasonably be expected to cause a Material Adverse
Change,

        (d)  the occurrence of any Termination Event that could reasonably be
expected to result in liability in excess of $10,000,000, and

        (e)  the filing of any suit or proceeding, or the assertion in writing
of a claim against any Related Person or with respect to any Related Person's
properties in which an adverse decision could reasonably be expected to cause a
Material Adverse Change.

Upon the occurrence of any of the foregoing, Restricted Persons will take all
necessary or appropriate steps to remedy promptly any such Material Adverse
Change, Default, acceleration, default, or Termination Event to protect against
any such adverse claim, to defend any such suit or proceeding, and to resolve
all controversies on account of any of the foregoing.

        Section 6.5.    Maintenance of Properties.    Each Related Person will
maintain, preserve, protect and keep all Collateral and all other material
property used or useful in the conduct of its business in good condition
(ordinary wear and tear excepted) in accordance with prudent industry standards,
and in material compliance with all applicable Laws, and will from time to time
make all repairs, renewals and replacements needed to enable the business and
operations carried on in connection therewith to be promptly and advantageously
conducted at all times.

        Section 6.6.    Maintenance of Existence and Qualifications.    Each
Related Person will maintain and preserve its existence and its rights and
franchises in full force and effect and will qualify to do business

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in all states or jurisdictions where required by applicable Law, except where
the failure so to qualify could not reasonably be expected to cause a Material
Adverse Change.

        Section 6.7.    Payment of Trade Liabilities, Taxes, etc.    Each
Related Person will (a) timely file all required tax returns including any
extensions; (b) timely pay all taxes, assessments, and other governmental
charges or levies imposed upon it or upon its income, profits or property before
the same shall become delinquent; (c) pay all obligations and liabilities owed
by it on ordinary trade terms to vendors, suppliers and other Persons providing
goods and services used by it in the ordinary course of its business before the
same shall become delinquent; (d) pay and discharge before the same shall become
delinquent all other obligations and liabilities now or hereafter owed by it,
other than royalty payments suspended in the ordinary course of business; and
(e) maintain appropriate accruals and reserves for all of the foregoing in
accordance with GAAP. Each Related Person may, however, delay paying or
discharging any of the foregoing so long as it is in good faith contesting the
validity thereof by appropriate proceedings, if necessary, and has set aside on
its books adequate reserves therefor to the extent required by GAAP.

        Section 6.8.    Insurance.    Each Related Person will at all times
maintain, with financially sound and reputable insurance companies, insurance in
at least such amounts, with at least such limitations on deductibles, and
against at least such casualties, liabilities and other risks as are usually
insured against in the same general area by prudent companies of similar size
engaged in the same or a similar business and will furnish to each Lender, upon
written request, full information as to the insurance carried. All insurance
policies covering Collateral shall be endorsed (a) to provide for payment of
losses to Administrative Agent as its interests may appear, (b) to provide that
such policies may not be canceled or reduced or affected in any material manner
for any reason without ten (10) days prior notice to Administrative Agent, and
(c) to provide for any other matters specified in any applicable Security
Document or which Administrative Agent may reasonably require.

        Section 6.9.    Performance on Borrower's Behalf.    If any Restricted
Person fails to pay any taxes, insurance premiums, expenses, attorneys' fees or
other amounts it is required to pay under any Loan Document, Administrative
Agent may pay the same after notice of such payment by Administrative Agent is
given to Borrower. Borrower shall immediately reimburse Administrative Agent for
any such payments and each amount paid by Administrative Agent shall constitute
an Obligation owed hereunder which is due and payable on the date such amount is
paid by Administrative Agent.

        Section 6.10.    Interest.    Borrower hereby promises to each Lender to
pay interest at the Default Rate on all Obligations (including Obligations to
pay fees or to reimburse or indemnify any Lender) which Borrower has in this
Agreement promised to pay to such Lender and which are not paid when due. Such
interest shall accrue from the date such Obligations become due until they are
paid.

        Section 6.11.    Compliance with Agreements and Law.    Each Related
Person will perform all obligations it is required to perform under the terms of
each indenture, mortgage, deed of trust, security agreement, lease, and
franchise, and each agreement, contract or other instrument or obligation to
which it is a party or by which it, the Systems or any of its properties is
bound except where failure to comply could not reasonably be expected to have a
Material Adverse Change. Each Related Person will conduct its business and
affairs in compliance with all Laws applicable thereto except where failure to
comply could not reasonably be expected to have a Material Adverse Change. Each
Related Person will cause all licenses and permits necessary or appropriate for
the conduct of its business and the ownership and operation of the Systems and
all other property used and useful in the conduct of its business to be at all
times maintained in good standing and in full force and effect except where
failure to comply could not reasonably be expected to have a Material Adverse
Change.

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        Section 6.12.    Environmental Matters; Environmental Reviews.    

        (a)  Each Related Person will comply in all material respects with all
Environmental Laws now or hereafter applicable to such Related Person as well as
all contractual obligations and agreements with respect to environmental
remediation or other environmental matters and shall obtain, at or prior to the
time required by applicable Environmental Laws, all environmental, health and
safety permits, licenses and other authorizations necessary for its operations
and will maintain such authorizations in full force and effect.

        (b)  Borrower will promptly notify Administrative Agent of all
violations, orders, claims, citations, complaints, penalty assessments, suits or
other proceedings of which a Responsible Officer has notice, pending or
threatened against any Related Person by any governmental authority with respect
to (i) any alleged violation of or non-compliance with any Environmental Laws or
any permits, licenses or authorizations in connection with its ownership or use
of its properties or the operation of its business or (ii) any potential
responsibility with respect to any investigation or clean-up of Hazardous
Material at any location, in each such case (i) or (ii) where such Responsible
Officer has concluded that it is reasonable to expect either (A) the same would
cause a Material Adverse Change if resolved adversely against any Related Person
or (B) the potential liability of which exceeds, when aggregated with all other
such violations, orders, claims, citations, complaints, penalty assessments,
suits or other proceedings, $10,000,000 in a Fiscal Year.

        Section 6.13.    Guaranties of Subsidiaries.    

        (a)  Subject to Section 6.13(b), each Restricted Subsidiary of Pacific
Energy Partners (other than Borrower) now existing or created, acquired or
coming into existence after the date hereof shall, promptly upon request by
Administrative Agent, execute and deliver to Administrative Agent an absolute
and unconditional Guaranty of the timely repayment of the Obligations and the
due and punctual performance of the obligations of Borrower hereunder. Subject
to Section 6.13(b), each Restricted Subsidiary of Pacific Energy Partners
existing on the date hereof (other than Borrower) shall duly execute and deliver
such a Guaranty prior to the making of any Loan hereunder. Pacific Energy
Partners and Borrower will cause each of its Restricted Subsidiaries (other than
Borrower) to deliver to Administrative Agent, simultaneously with its delivery
of such a Guaranty, written evidence reasonably satisfactory to Administrative
Agent and its counsel that such Restricted Subsidiary has taken all corporate,
limited liability company or partnership action necessary to duly approve and
authorize its execution, delivery and performance of such Guaranty and any other
documents which it is required to execute.

        (b)  Pacific Pipeline System LLC, Pacific Terminals LLC and each other
PUC Restricted Subsidiary shall not be required to provide a Guaranty pursuant
to Section 6.13(a) unless regulatory approval shall have been obtained for such
Guaranty from the applicable public utility commission having such regulatory
authority over such PUC Restricted Subsidiary (in this Section called the
applicable "PUC"). Pacific Energy Partners and Borrower shall cause the PUC
Restricted Subsidiary to use its best efforts to obtain the approval of the
applicable PUC for a Guaranty of the Obligations (i) on or prior to the
consummation of the EPTC Acquisition, or if the EPTC Acquisition is abandoned or
terminated, as promptly as possible after such abandonment or termination, in
the case of Pacific Pipeline System LLC, (ii) upon consummation of the EPTC
Acquisition, in the case of Pacific Terminals LLC and, (iii) upon acquisition of
such PUC Restricted Subsidiary, in the case of another PUC Restricted
Subsidiary. Pacific Energy Partners and Borrower shall cause the PUC Restricted
Subsidiary to use such best efforts to obtain the approval of the applicable PUC
for an absolute and unconditional Guaranty except to the extent that Restricted
Persons reasonably determine that a request for a limited Guaranty substantially
increases the likelihood of obtaining such approval, and, to the extent
expressly required by the applicable PUC, the maximum principal amount of such
Guaranty shall be limited to the maximum amount specified by the applicable PUC
approval; provided further that such request for

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approval shall be for not less than $176,000,000 in the case of Pacific Pipeline
System LLC and not less than the purchase price for the assets to be acquired
under the EPTC Acquisition Documents in the case of Pacific Terminals LLC.

        (c)  In the event Pacific Energy Partners and Borrower shall be unable
to obtain approval of the applicable PUC for any such Guaranty after the
exercise of their best efforts, Pacific Energy Partners and Borrower shall use
their best efforts to obtain the approval of the applicable PUC for a debt
obligation satisfactory to Administrative Agent issued by such PUC Restricted
Subsidiary payable to Borrower, and for the pledge by Borrower of such debt
obligation to Administrative Agent for the benefit of the Lenders to secure the
Obligations. At the time such approval is obtained (if at all), Borrower shall
cause such PUC Restricted Subsidiary to incur such debt obligation and shall
pledge such debt obligation to Administrative Agent for the benefit of the
Lenders, which debt obligation and pledge shall be reasonably satisfactory to
the Administrative Agent in form and substance. Borrower will deliver to the
Administrative Agent, simultaneously with its delivery of such debt obligation
and such pledge, written evidence reasonably satisfactory to Administrative
Agent and its counsel that Borrower and such PUC Restricted Subsidiary have
taken all corporate, limited liability company or partnership action to approve
and authorize its execution, delivery and performance of such debt obligation
and pledge. If the debt obligation and pledge contemplated by the preceding two
sentences are permitted without the approval of the applicable PUC, during such
period that the Guaranty is not provided by the applicable PUC Restricted
Subsidiary pursuant to this Section 6.13, upon request of Majority Lenders, the
applicable PUC Restricted Subsidiary shall incur such debt obligation and
Borrower shall provide such pledge as contemplated by the preceding two
sentences.

        (d)  Neither this Section 6.13 nor any other provision of any Loan
Document shall require a Guaranty by a PUC Restricted Subsidiary, or the
incurrence of debt obligation by a PUC Restricted Subsidiary and pledge thereof,
in either case to the extent that such PUC Restricted Subsidiary shall not have
obtained the required approval of the applicable PUC after the exercise of its
best efforts in accordance with subsection (b) or (c) of this Section 6.13.

        Section 6.14.    Regarding the Systems.    Each Restricted Person will
cause to be maintained in full force and effect all easements, rights of way,
servitudes, leases, and other agreements necessary to the operations of the
Systems and will properly and timely pay all rents and other payments due under
the provisions thereof, except with respect to all of the foregoing where
failure to comply could not reasonably be expected to cause a Material Adverse
Change. No Restricted Person will permit any of its Systems (taken as a whole)
or any material part thereof to be leased to a third party, to cease to operate
or to be abandoned, except in the ordinary course of business, as a result of
customary events of force majeure or as permitted by Section 7.5.

        Section 6.15.    Clean Down Period.    During each Fiscal Year in which
Working Capital Loans are made which are used to fund distributions by Pacific
Energy Partners (such Working Capital Loans used to fund distributions by
Pacific Energy Partners being herein called "Distribution Loans"), there shall
be a fifteen (15) consecutive day period (the "Clean Down Period") during which
(a) there are no Distribution Loans outstanding, and (b) no Distribution Loans
will be made. The Clean Down Period for a Fiscal Year may begin on any date that
is after the first Distribution Loan is made in such Fiscal Year.

        Section 6.16.    Agreement to Deliver Security Documents.    

        (a)  Subject to Section 6.16(b) and Section 7.2(n), Borrower agrees to
deliver and to cause each other Restricted Person to deliver, to further secure
the Obligations and any Lender Hedging Obligations whenever requested by
Administrative Agent in its sole and absolute discretion, deeds of trust,
mortgages, pledge agreements, security agreements, financing statements,
continuation statements, extension agreements, acknowledgments, and other
Security Documents in form and substance reasonably satisfactory to
Administrative Agent, in each case for the purpose of granting, confirming,

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protecting and perfecting Liens or security interests in any real property,
fixtures and contract rights necessary to the operation of the pipeline systems,
gathering systems and storage facilities owned by such Restricted Person
(excluding all cash, inventory, accounts, other personal property, products and
proceeds related to any of the foregoing) (collectively, the "Real Property
Collateral") now owned or hereafter acquired by any Restricted Person (other
than the property of Pacific Marketing and Transportation LLC existing on the
date hereof and expansions of, additions to, or replacements for, such existing
property of Pacific Marketing and Transportation LLC), including Liens in Equity
Interests in each other Restricted Subsidiary now owned or hereafter acquired by
any Restricted Person or in such other property which is at such time Collateral
or which was intended to be Collateral pursuant to any Security Document
previously executed and not then released by Administrative Agent; provided that
to the extent any such property is not wholly owned by such Restricted Person,
Borrower shall cause such Restricted Person to use its best efforts to obtain
any necessary consents to the grant of such Liens or security interests where
commercially reasonable to do so. Borrower also agrees to deliver, whenever
requested by Administrative Agent in its sole and absolute discretion, favorable
opinions from legal counsel acceptable to Administrative Agent with respect to
the enforceability of the Liens created by the Security Documents, in a form and
substance reasonably acceptable to the Administrative Agent.

        (b)  Pacific Pipeline System LLC, Pacific Terminals LLC and each other
PUC Restricted Subsidiary shall not be required to execute and deliver any
Security Document pursuant to Section 6.16(a) unless regulatory approval shall
have been obtained for such Security Document from the applicable public utility
commission having such regulatory authority over such PUC Restricted Subsidiary
(in this Section called the applicable "PUC"). Pacific Energy Partners and
Borrower shall cause the PUC Restricted Subsidiary to use its best efforts to
obtain the approval of the applicable PUC for Liens and security interests
covering any Real Property Collateral now owned or hereafter acquired by such
Person to secure the Obligations in such PUC Restricted Subsidiary's Guaranty
(if delivered pursuant to Section 6.13) (i) on or prior to the consummation of
the EPTC Acquisition, or if the EPTC Acquisition is abandoned or terminated, as
promptly as possible after such abandonment or termination, in the case of
Pacific Pipeline System LLC, (ii) upon consummation of the EPTC Acquisition, in
the case of Pacific Terminals LLC and, (iii) upon acquisition of such PUC
Restricted Subsidiary, in the case of another PUC Restricted Subsidiary.

        (c)  Neither this Section 6.16 nor any other provision of any Loan
Document shall require a PUC Restricted Subsidiary to deliver any Security
Document pursuant to Section 6.16(a) to the extent that such PUC Restricted
Subsidiary shall not have obtained the required approval of the applicable PUC
after the exercise of its best efforts in accordance with subsection (b) of this
Section 6.16.

        Section 6.17.    Subsidiaries; Unrestricted Subsidiaries.    The
Borrower and Pacific Energy Partners:

        (a)  will promptly, and in any event within 10 days, notify the
Administrative Agent if any additional Subsidiary is formed or acquired after
the Closing Date and whether such Subsidiary is an Unrestricted Subsidiary or a
Restricted Subsidiary;

        (b)  will not, and will not permit any Restricted Person to, incur any
Guaranty Obligations in respect of any Indebtedness of any of the Unrestricted
Subsidiaries;

        (c)  will not permit the aggregate amount of Investments by Restricted
Persons in all Unrestricted Subsidiaries at any one time (being the sum of (but
without duplication) (i) the purchase price of Equity Interests of such
Unrestricted Subsidiaries plus (ii) the amount of cash and the fair market value
of property contributed to or loans to such Unrestricted Subsidiary minus
(iii) any distributions representing a return of such equity, contributed
capital or loans, but excluding any other changes in the book values of such
Investments, such as from retained earning and losses) to exceed $75,000,000;

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        (d)  will not permit any Unrestricted Subsidiary to hold any equity or
other ownership interest in, or any Indebtedness of, any Restricted Person;

        (e)  will operate each Unrestricted Subsidiary in such a manner as to
make it apparent to all creditors of such Unrestricted Subsidiary that such
Unrestricted Subsidiary is a legal entity separate and distinct from all of the
Restricted Persons and as such is solely responsible for its debts;

        (f)    will not permit any Restricted Person to incur Indebtedness owing
to any Unrestricted Subsidiary;

        (g)  will not permit any Unrestricted Subsidiary to engage directly or
indirectly in any business or conduct any operations except in connection with
or incidental to its Present and Related Businesses; and

        (h)  will cause each Unrestricted Subsidiary to incur Indebtedness only
under notes, loan agreements or other applicable agreements that expressly state
that such Indebtedness is being incurred by such Unrestricted Subsidiary on a
basis that is non-recourse to the Restricted Persons.

        Section 6.18.    Designation and Conversion of Restricted and
Unrestricted Subsidiaries.    

        (a)  Unless designated as an Unrestricted Subsidiary after the date of
this Agreement in writing to the Administrative Agent, any Person that becomes a
Subsidiary of the Borrower or Pacific Energy Partners or any of their Restricted
Subsidiaries shall be classified as a Restricted Subsidiary.

        (b)  The Borrower and Pacific Energy Partners may designate any of its
Subsidiaries (including a newly formed or newly acquired Subsidiary) as an
Unrestricted Subsidiary if, after giving effect to such designation, no Default
or Event of Default would exist; provided, however, that neither Pacific
Pipeline System LLC, Pacific Terminals LLC, Rocky Mountain Pipeline System LLC
nor any other Subsidiary whose net earnings (or pro forma net earnings in the
case of a newly formed Subsidiary) as of the most recent Fiscal Quarter end
prior to such designation exceeded 10% of Consolidated net earnings of Pacific
Energy Partners may be designated as an Unrestricted Subsidiary and no material
assets (other than cash) of any Restricted Subsidiary may be contributed to an
Unrestricted Subsidiary except assets acquired by a Restricted Subsidiary after
the date of this Agreement and contributed to an Unrestricted Subsidiary within
ninety (90) days after the date such assets are acquired by the Restricted
Subsidiary. Except as provided in this Section 6.18, no Restricted Subsidiary
may be redesignated as an Unrestricted Subsidiary.

        (c)  The Borrower and Pacific Energy Partners may designate any
Unrestricted Subsidiary to be a Restricted Subsidiary if, after giving effect to
such designation, no Default or Event of Default would exist.

        Section 6.19.    Change of Name and other Matters.    No Restricted
Person will cause or permit any change to be made in its name, identity,
corporate, limited liability company or partnership structure, the jurisdiction
of its formation, or its federal employer identification number, unless such
Restricted Person shall notify Administrative Agent of such change prior to the
effective date of such change and thereafter shall promptly take all actions
reasonably required by Administrative Agent for the purpose of further
perfecting or protecting the Liens granted to or held by Administrative Agent.

ARTICLE VII—Negative Covenants

        To conform with the terms and conditions under which each Lender is
willing to have credit outstanding to Borrower, and to induce each Lender to
enter into this Agreement and make the Loans, Pacific Energy Partners and
Borrower covenant and agree that until the full and final payment of the

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Obligations and the termination of this Agreement, unless Majority Lenders, or
all Lenders as required under Section 10.1, have previously agreed otherwise:

        Section 7.1.    Indebtedness.    No Restricted Person will in any manner
owe or be liable for Indebtedness except:

        (a)  the Obligations and the Indebtedness existing on the date of this
Agreement and listed on the Disclosure Schedule, which Indebtedness will be
satisfied, repaid, refinanced, or purchased on the Closing Date;

        (b)  Indebtedness of Pacific Energy Partners, Borrower or a Restricted
Subsidiary that is a Guarantor arising under a Hedging Contract permitted under
Section 7.3;

        (c)  Indebtedness of any Restricted Person owing to any other Restricted
Person, including, without limitation, Indebtedness arising from the purchase by
Borrower of the indebtedness under the Citibank Credit Agreement; provided,
however, any Indebtedness owing to a Restricted Person (other than Borrower)
that is not a Guarantor shall be subordinated to the Obligations and the Lender
Hedging Obligations on terms satisfactory to Administrative Agent in its sole
and absolute discretion;

        (d)  Indebtedness of Pacific Energy Partners or Borrower that is
Subordinated Indebtedness;

        (e)  Indebtedness of any Restricted Person in respect to leases or
financing of trucks or vehicles having rental or other payments not exceeding
$2,000,000 in any twelve (12) month period in the aggregate in respect of all
such leases and financings;

        (f)    Indebtedness of Pacific Energy Partners, Borrower or a Subsidiary
that is a Guarantor (without duplicating amounts considered as Guaranty
Obligations for the same Indebtedness), other than specified under paragraphs
(a) through (e) of this Section 7.1 not to exceed in the aggregate a principal
amount of $40,000,000 at any one time outstanding.

        Section 7.2.    Limitation on Liens.    No Restricted Person will
create, assume or permit to exist (i) any Lien upon any accounts, inventory,
cash or investment securities except (A) Permitted Inventory Liens,
(B) statutory Liens securing payables arising from the purchase of oil or gas at
the wellhead and (C) Liens of the type described in clauses (a), (c), (d),
(e) and (f) below or (ii) any Lien upon any of the other properties or assets
that it now owns or hereafter acquires except the following (Liens, to the
extent permitted by this Section 7.2, herein called "Permitted Liens"):

        (a)  Liens created pursuant to this Agreement or the Security Documents
and Liens existing on the date of this Agreement and listed in the Disclosure
Schedule.

        (b)  Liens imposed by any governmental authority for taxes, assessments
or charges not yet due or the validity of which is being contested in good faith
and by appropriate proceedings, if necessary, for which adequate reserves are
maintained on the books of any Restricted Person in accordance with GAAP;

        (c)  pledges or deposits of cash or securities under worker's
compensation, unemployment insurance or other social security legislation;

        (d)  carriers', warehousemen's, mechanics', materialmen's, repairmen's,
landlord's, or other like Liens (including, without limitation, Liens on
property of any Restricted Person in the possession of storage facilities,
pipelines or barges) arising in the ordinary course of business for amounts
which are not more than 60 days past due or the validity of which is being
contested in good faith and by appropriate proceedings, if necessary, and for
which adequate reserves are maintained on the books of any Restricted Person in
accordance with GAAP;

        (e)  Liens under or with respect to accounts with brokers or
counterparties with respect to Hedging Contracts encumbering cash, commodities
or futures contracts, options, securities, instruments,

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and other like assets held in such accounts securing only Hedging Contracts
permitted under Section 7.3;

        (f)    deposits of cash or securities to secure the performance of bids,
trade contracts (other than for borrowed money), leases, statutory obligations,
surety and appeal bonds, performance bonds and other obligations of a like
nature incurred in the ordinary course of business;

        (g)  easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business and encumbrances
consisting of zoning restrictions, easements, licenses, restrictions on the use
of real property or minor imperfections in title thereto which, in the
aggregate, are not material in amount, and which do not in any case materially
detract from the value of the property subject thereto or interfere with the
ordinary conduct of the business of any Restricted Person;

        (h)  Liens in respect of purchase money obligations, operating leases
and Capital Leases provided that Indebtedness is permitted under Section 7.1;

        (i)    rights reserved to or vested in any governmental authority by the
terms of any right, power, franchise, grant, license or permit, or by any
provision of law, to revoke or terminate any such right, power, franchise,
grant, license or permit or to condemn or acquire by eminent domain or similar
process;

        (j)    rights reserved to or vested by Law in any governmental authority
to, in any manner, control or regulate in any manner any of the properties of
any Restricted Person or the use thereof or the rights and interests of any
Restricted Person therein, in any manner under any and all Laws;

        (k)  rights reserved to the grantors of any properties of any Restricted
Person, and the restrictions, conditions, restrictive covenants and limitations,
in respect thereto, pursuant to the terms, conditions and provisions of any
rights-of-way agreements, contracts or other agreements therewith;

        (l)    inchoate Liens in respect of pending litigation or with respect
to a judgment which has not resulted in an Event of Default under Section 8.1;

        (m)  restrictions, conditions, terms and other provisions and rights,
reserved by the issuing authority under all leases, licenses and permits
constituting part of, or used in connection with, the Systems; and

        (n)  any Lien existing on any property or asset of any Person that
becomes a Subsidiary of Borrower or Pacific Energy Partners after the date of
this Agreement prior to the time such Person becomes a Subsidiary; provided that
(i) such Lien is not created in contemplation of or in connection with such
Person becoming a Subsidiary, (ii) such Lien shall not apply to any other
property or assets of Borrower or Pacific Energy Partners or any of their
respective Subsidiaries, (iii) such Lien shall secure only those obligations
which it secures on the date such Person becomes a Subsidiary and any renewals,
extensions and modifications (but not increases) thereof, (iv) the Indebtedness
secured by Liens permitted by this subsection is permitted under Section 7.1,
and (v) Borrower or Pacific Energy Partners, as applicable, shall demonstrate
pro forma compliance with this Section 7.2(n) at the closing of such
acquisition.

        Section 7.3.    Hedging Contracts.    No Restricted Person will be a
party to or in any manner be liable on any Hedging Contract, except:

        (a)  Hedging Contracts entered into by Pacific Energy Partners, Borrower
or a Guarantor with the purpose and effect of fixing interest rates on a
principal amount of indebtedness of such Person that is accruing interest at a
variable rate, provided that (i) the aggregate notional amount of such contracts
never exceeds one hundred percent (100%) of the anticipated outstanding
principal balance of the indebtedness to be hedged by such contracts or an
average of such principal balances calculated using a generally accepted method
of matching interest swap contracts to declining principal balances, (ii) the
floating rate index of each such contract generally matches the index used to
determine the floating

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rates of interest on the corresponding indebtedness to be hedged by such
contract and (iii) each such contract is with a counterparty or has a guarantor
of the obligation of the counterparty who (unless such counterparty is a Lender
or an Affiliate of any Lender at the time such contract is entered into) at the
time the contract is made has long-term unsecured and unenhanced debt
obligations rated A or A2 or better, respectively, by either Rating Agency or is
otherwise acceptable to Majority Lenders.

        (b)  Hedging Contracts entered into by Pacific Energy Partners, Borrower
or a Guarantor with the purpose and effect of converting to a variable interest
rate on a principal amount of indebtedness of such Person that is accruing
interest at a fixed rate, provided that (i) the aggregate notional amount of
such contracts never exceeds one hundred percent (100%) of the anticipated
outstanding principal balance of such indebtedness or an average of such
principal balances calculated using a generally accepted method of matching
interest swap contracts to declining principal balances, and (ii) each such
contract is with a counterparty or has a guarantor of the obligation of the
counterparty who (unless such counterparty is a Lender or an Affiliate of any
Lender at the time such contract is entered into) at the time the contract is
made has long-term unsecured and unenhanced debt obligations rated A or A2 or
better, respectively, by either Rating Agency or is otherwise acceptable to
Majority Lenders.

        (c)  Hedging Contracts entered into by Pacific Energy Partners, Borrower
or a Guarantor as an Offsetting Position to a Petroleum Inventory Position,
provided that at all times: (i) no such contract fixes a price for a term of
more than twelve (12) months after the date the contract is entered into;
(ii) the aggregate quantity covered by all such contracts (determined, in the
case of contracts that are not settled on a monthly basis, by a monthly
proration acceptable to Administrative Agent) at any one time does not exceed
2,000,000 barrels, and (iii) each such contract is either (A) New York
Mercantile Exchange contract or (B) with a counterparty or has a guarantor of
the obligation of the counterparty who (unless such counterparty is a Lender or
an Affiliate of any Lender at the time such contract is entered into) at the
time the contract is made has long-term obligations rated A or A2 or better,
respectively, by either Rating Agency or is otherwise acceptable to Majority
Lenders.

        Section 7.4.    Limitation on Mergers, Issuances of
Securities.    Except for Permitted Acquisitions and as expressly provided in
this section, no Restricted Person will (a) enter into any transaction of merger
or consolidation or amalgamation, or liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution), (b) acquire any business or property
from, or capital stock of, or be a party to any acquisition of, any Person
except for purchases of inventory and other property to be sold or used in the
ordinary course of business and Investments permitted under Section 7.7 hereof
or (c) sell, transfer, lease, exchange, alienate or otherwise dispose of, in one
transaction or a series of transactions, any part of its business or property,
whether now owned or hereafter acquired, except for sales, transfers, leases,
exchanges, alienations or other dispositions not prohibited by Section 7.5
hereof. Any Person, other than Borrower, that is a Subsidiary of a Restricted
Person may, however, be merged into or consolidated with another Subsidiary of
such Restricted Person, so long as a Restricted Person is the surviving business
entity, or such Restricted Person, so long as such Restricted Person is the
surviving business entity. Pacific Energy Partners will not issue any securities
other than (i) limited partnership interests and any options or warrants giving
the holders thereof only the right to acquire such interests, and (ii) general
partnership interests issued to the General Partner. Except as disclosed in the
Disclosure Schedule, no Restricted Subsidiary of Pacific Energy Partners will
issue any additional Equity Interests or other securities or any options,
warrants or other rights to acquire such additional Equity Interests or other
securities except a direct Restricted Subsidiary of a Restricted Person may
issue additional Equity Interests or other securities to such Restricted Person
so long as such Restricted Subsidiary is a Wholly Owned Subsidiary of Pacific
Energy Partners after giving effect thereto. No Subsidiary of Borrower which is
a partnership will allow any diminution of Borrower's interest (direct or
indirect) therein.

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        Section 7.5.    Limitation on Sales of Property.    No Restricted Person
will sell, transfer, lease, exchange, alienate or dispose of any Collateral or
any of its assets or properties (including, without limitation, capital stock of
any of its Subsidiaries) or any material interest therein except:

        (a)  equipment which is worthless or obsolete or no longer necessary or
useful to the proper conduct of its business or which is replaced by equipment
of equal suitability and value;

        (b)  (i) sales or transfers by a Person (other than Borrower) that is a
Subsidiary of a Restricted Person to such Restricted Person or to a Wholly Owned
Subsidiary of such Restricted Person that is a Guarantor and (ii) to the extent
not covered by clause (i), transfers by a Restricted Person to a Restricted
Person (other than to Pacific Energy Partners if such transfer is not in respect
of capital contributions made to Pacific Energy Partners in connection with the
public offering contemplated in Section 4.1(o)) in respect of capital
contributions permitted under clause (d) of the definition of Permitted
Investments;

        (c)  sales or transfers by a Restricted Person of inventory in the
ordinary course of business;

        (d)  sales or transfers of other property for fair consideration, which
is in the best interests of the Company and will not materially impair or
diminish the value of the Collateral or any Restricted Person's financial
condition, business or operations; provided that:

          (i)  prior to and immediately after giving effect to such proposed
sale or transfer no Default or Event of Default shall exist and be continuing,
and the consummation of any such transaction would not result in a violation of
Section 7.10, 7.11 or 7.12, calculated for such purpose as of the date on which
such sale is to be consummated on a pro forma basis after giving effect to any
such sale, with Consolidated EBITDA calculated as at the last day of the most
recently ended fiscal quarter as if such sale had occurred on the first day of
the relevant four quarter period;

        (ii)  such sale or transfer is for consideration consisting of not less
than 75% cash;

        (iii)  in the event that the aggregate Net Proceeds of all such sales or
transfers from the date hereof through the date any Net Proceeds are received
(less the amount thereof previously applied in accordance with clause (x) of
this clause (iii)) exceeds 5% of Pacific Energy Partners' Consolidated assets
measured as of the close of the then most recent Fiscal Quarter end (such excess
amount being herein called "Excess Sale Proceeds"), Restricted Persons shall,
within 180 days of the date on which such Net Proceeds exceeded any such
limitation, cause an amount equal to such Excess Sale Proceeds to be applied
(x) to the acquisition of substantially similar assets in replacement of the
assets so disposed of or other Permitted Acquisitions or to other Reinvestments,
or (y) to the extent not applied pursuant to the immediately preceding
clause (x), to prepay the Loans as provided in Section 2.6 and, to the extent
required by Section 2.6, permanently reduce the Maximum Revolver Facility
Amount;

        (iv)  upon receipt of Excess Sale Proceeds by a Restricted Person and
until the application thereof as provided in clause (iii)(x) or (y), such
Restricted Person shall either, or in combination equal to the total of such
Excess Sale Proceeds, both (A) maintain such Excess Sale Proceeds in a
segregated account that is a Cash Equivalent Investment or (B) apply such Excess
Sale Proceeds to prepay the Revolver Loans but without reduction of the Revolver
Commitment; and

        (v)  satisfaction of the requirements of clauses (i) and (ii) of this
Section 7.5 (d) have been set forth in reasonable detail in an officer's
certificate satisfactory to the Administrative Agent, delivered to the
Administrative Agent as promptly as possible and in no event less than five
Business Days prior to the consummation of such sale;

        (e)  in the case of Pacific Terminals LLC, leases of tanks and other
equipment or property in the ordinary course of business; and

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        (f)    sales or transfers to an Unrestricted Subsidiary, subject to
compliance with Sections 6.17 and 6.18.

No Restricted Person will discount, sell, pledge or assign any notes payable to
it, accounts receivable or future income.

        Section 7.6.    Limitation on Dividends, Redemptions and
Prepayments.    No Restricted Person will declare or pay any dividends on, or
make any other distribution in respect of, any class of its capital stock or any
partnership, limited liability company or other interest in it, nor will any
Restricted Person directly or indirectly make any capital contribution of any
nature to or purchase, redeem, acquire or retire any shares of the capital stock
of or partnership or limited liability company interests in any Restricted
Person (whether such interests are now or hereafter issued, outstanding or
created), or cause or permit any reduction or retirement of the capital stock of
any Restricted Person, while any Loan or commitment hereunder is outstanding.
Notwithstanding the foregoing, but subject to Section 7.5, (i) Subsidiaries of
Borrower, or of any Guarantor shall not be restricted, directly or indirectly,
from declaring and paying dividends or making any other distributions to
Borrower, or any such Guarantor, respectively, (ii) no Restricted Person shall
be restricted from making capital contributions of any nature to a Wholly Owned
Subsidiary of such Restricted Person that is a Guarantor, and (iii) so long as
no Default or Event of Default has occurred and is continuing or would result
therefrom, Borrower shall not be restricted from making quarterly distributions
to Pacific Energy Partners and Pacific Energy Partners shall not be restricted
from making distributions to its partners of Available Cash (other than amounts
required to be applied as otherwise required in any Loan Document) in accordance
with the Partnership Agreement. No Restricted Person will pay any principal
amount of any Subordinated Indebtedness prior to its scheduled maturity.

        Section 7.7.    Limitation on Investments and New Businesses; Limitation
on Credit Extensions.    No Restricted Person will (a) engage directly or
indirectly in any business or conduct any operations except in connection with
or incidental to its Present and Related Businesses, (b) make any acquisitions
of or capital contributions to or other Investments in any Person, other than
Permitted Investments or Permitted Acquisitions, or (c) make any acquisitions of
material properties or assets of, or capital stock of, another Person other than
Permitted Acquisitions or Permitted Investments. All transactions permitted
under the foregoing subsection (a) are subject to Section 7.5. No Restricted
Person will extend credit, make advances or make loans, except for Permitted
Investments and Hedging Contracts permitted under Section 7.3. Pacific Energy
Partners will not engage in any material business other than the ownership of
the Borrower.

        Section 7.8.    Transactions with Affiliates.    Except as disclosed in
the Disclosure Schedule, no Restricted Person will engage in any material
transaction with any of its Affiliates except: (a) transactions among Borrower
and Wholly Owned Subsidiaries of Borrower, subject to the other provisions of
this Agreement, (b) transactions entered into in the ordinary course of business
of such Restricted Person on terms which are no less favorable to such
Restricted Person than those which would have been obtainable at the time in
arm's-length transactions with Persons other than such Affiliates, and
(c) transactions between Restricted Persons and their Affiliates pursuant to
which Affiliates provide personnel for the management and operation of the
businesses conducted by Restricted Persons and various administrative and
overhead services and functions, including, without limitation, insurance,
information technology, credit facilitation, treasury and accounting, health and
safety, and legal, in each case in accordance with the Partnership Agreement.

        Section 7.9.    Prohibited Contracts.    Except as expressly provided
for in the Loan Documents and as described in the Disclosure Schedule, no
Restricted Person will, directly or indirectly, enter into, create, or otherwise
allow to exist any contract or other consensual restriction on the ability of
any Restricted Person to: (a) pay dividends or make other distributions in
respect of the Equity Interest held in it by another Restricted Person,
(b) redeem any Equity Interests held in it by another

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Restricted Person, (c) repay loans and other indebtedness owing by it to another
Restricted Person, or (d) transfer any of its assets to another Restricted
Person. Except as disclosed in the Disclosure Schedule, no Restricted Person
will, directly or indirectly, enter into, create, or otherwise allow to exist
any contract or other consensual restriction on its ability or the ability of
any other Restricted Person to grant Liens on its assets, other than the
restrictions contained in this Agreement. No Restricted Person will enter into
any material "take-or-pay" contract or other contract or arrangement for the
purchase of goods or services which obligates it to pay for such goods or
service regardless of whether they are delivered or furnished to it other than
contracts for pipeline capacity or for services in either case reasonably
anticipated to be utilized in the ordinary course of business. No Restricted
Person will amend or permit any amendment to any contract or lease which
releases, qualifies, limits, makes contingent or otherwise detrimentally affects
in any material respect the rights and benefits of Administrative Agent or any
Lender under or acquired pursuant to any Security Documents. No ERISA Affiliate
will incur any obligation to contribute to any "multiemployer plan" as defined
in Section 4001 of ERISA that is subject to Title IV of ERISA.

        Section 7.10.    Leverage Ratio.    The ratio of (a) Consolidated Funded
Indebtedness to (b) Consolidated EBITDA for the four Fiscal Quarter period most
recently ended prior to the date of determination for which financial statements
contemplated by Section 6.2(a) or (b) are available to Pacific Energy Partners
will not be greater than the amount set forth below for the applicable time set
forth below:

          (i)  During the EPTC Acquisition Period: 5.25 to 1.0

        (ii)  Other than the EPTC Acquisition Period:

        (A)  From the date hereof through December 31, 2003 and at any time
thereafter that the Borrower Debt Rating shall be equal to or more favorable
than either BBB- by S&P or Baa3 by Moody's: 4.25 to 1.0; and

        (B)  From and after December 31, 2003 provided that Borrower Debt Rating
shall be less favorable than BBB- by S&P and Baa3 by Moody's: 4.00 to 1.0.

For purposes of this Section 7.10, if, since the beginning of the four Fiscal
Quarter period ending on the date for which Consolidated EBITDA is determined,
any Restricted Person shall have made any asset disposition or acquisition,
shall have consolidated or merged with or into any Person (other than another
Restricted Person), or shall have made any disposition or acquisition of a
Restricted Person, Consolidated EBITDA shall be calculated giving pro forma
effect thereto as if the disposition, acquisition, consolidation or merger had
occurred on the first day of such period. Such pro forma effect shall be
determined (i) in good faith by the chief financial officer, principal
accounting officer or treasurer of Borrower and acceptable to Administrative
Agent, and (ii) without giving effect to any anticipated or proposed change in
operations, revenues, expenses or other items included in the computation of
Consolidated EBITDA, except with the consent of Majority Lenders and
Administrative Agent. Such pro forma effect shall include (a) for the four
Fiscal Quarter period ending (i) June 30, 2002, three-quarters (75%) of the BP
Annual Pro Forma EBITDA, (ii) September 30, 2002, one-half (50%) of the BP
Annual Pro Forma EBITDA, and (iii) December 31, 2002, one-quarter (25%) of the
BP Annual Pro Forma EBITDA, and shall also include (b) for the four Fiscal
Quarter period ending (i) on the last day of the Fiscal Quarter in which the
EPTC Acquisition is consummated (the "EPTC Acquisition Quarter"), all (100%) of
the EPTC Annual Pro Forma EBITDA, (ii) on the last day of the first Fiscal
Quarter following the EPTC Acquisition Quarter, three-quarters (75%) of the EPTC
Annual Pro Forma EBITDA, (iii) on the last day of the second Fiscal Quarter
following the EPTC Acquisition Quarter, one-half (50%) of the EPTC Annual Pro
Forma EBITDA, and (iv) on the last day of the third Fiscal Quarter following the
EPTC Acquisition Quarter, one-fourth (25%) of the EPTC Annual Pro Forma EBITDA.
Further, if, since the beginning of the four Fiscal Quarter period ending on the
date for which Consolidated EBITDA is determined, any Restricted Person shall
have made any

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asset disposition (including through a consolidation or merger), or shall have
made any disposition of a Restricted Person, in either case to any Person other
than another Restricted Person and that would require an adjustment to
Consolidated EBITDA under the immediately preceding sentence, then, for a period
of 180 days after such disposition, for purposes of this Section 7.10, the
amount of the Net Proceeds thereof shall be subtracted from Consolidated Funded
Indebtedness to the extent that such Net Proceeds (x) are held by Restricted
Persons for the purposes of applying them to the acquisition of substantially
similar assets in replacement of the assets so disposed of or to other Permitted
Acquisitions or to other Reinvestments, (y) have not yet been so applied and
have not otherwise been applied to the payment of Indebtedness, and (z) are held
in a segregated account that is a Cash Equivalent Investment. As used above, "BP
Annual Pro Forma EBITA" means the annual pro forma EBITDA previously furnished
by Borrower to Administrative Agent and Lenders with respect to the acquisition
of certain assets from BP Corporation North America Inc. and BP Pipelines (North
America) Inc., which closed in December, 2001 and on March 1, 2002, and "EPTC
Annual Pro Forma EBITDA" means the annual pro forma EBITDA previously furnished
by Borrower to Administrative Agent and Lenders with respect to the EPTC
Acquisition.

        Section 7.11.    Interest Coverage Ratio.    At the end of each Fiscal
Quarter, beginning September 30, 2002, the ratio of (a) Consolidated EBITDA to
(b) Consolidated Interest Expense for the four Fiscal Quarter period then ended
(the "Interest Coverage Ratio") will not be less than 3.0 to 1.0; provided that,
for the four Fiscal Quarters immediately following the EPTC Acquisition, the
Interest Coverage Ratio will not be less than 2.5 to 1.0.

        Section 7.12.    Debt to Capital Ratio.    The ratio of (a) all
Consolidated Funded Indebtedness to (b) the sum of Consolidated Funded
Indebtedness plus Consolidated Net Worth (such Consolidated Net Worth to be the
amount determined as of the end of the most recently ended Fiscal Quarter prior
to the date of determination for which financial statements contemplated by
Section 6.2(a) or (b) are available to Pacific Energy Partners adjusted to
reflect only changes therein subsequent to the end of the most recently ended
Fiscal Quarter and prior to the date of determination resulting from
contributions to capital, issuances of Equity Interests or from dividends or
distributions) will never be greater than 0.70 to 1.0 at any time.

        Section 7.13.    Open Position; Trading.    No Restricted Person shall
at any time have any Open Positions other than physical inventories of Petroleum
Inventory consisting of (a) tank bottoms and line fill, or (b) other inventory
of up to 200,000 barrels in the aggregate at the end of any settlement period.
No Restricted Person will engage in trading, purchasing, selling or exchanging
Petroleum Inventory or any contract therefor except incidental to the business
of gathering, transporting, blending, storing or marketing by Restricted
Persons.

        Section 7.14.    Operating Agreements.    No Restricted Person shall
permit any amendment or modification to any of its articles, bylaws, or
partnership or limited liability company organization or operating documents or
agreements, or any amendment or modification of any agreements with Affiliates
of the type referred to in clause (c) of Section 7.8, if such amendment or
modification could reasonably be expected to materially and adversely affect
Lenders; provided, however, that the Lenders acknowledge that the Partnership
Agreement has not been executed as of the date of this Agreement and will be
executed (in substantially the form attached to the Pacific Energy Partners
Registration Statement) in connection with the closing of the transactions
contemplated by the Pacific Energy Partners Registration Statement.

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ARTICLE VIII—Events of Default and Remedies

        Section 8.1.    Events of Default.    Each of the following events
constitutes an Event of Default under this Agreement:

        (a)  Any Restricted Person fails to pay the principal component of any
Loan or any reimbursement obligation with respect to any Letter of Credit when
due and payable, whether at a date for the payment of a fixed installment or as
a contingent or other payment becomes due and payable or as a result of
acceleration or otherwise;

        (b)  Any Restricted Person fails to pay any Obligation (other than the
Obligations in subsection (a) above) when due and payable, whether at a date for
the payment of a fixed installment or as a contingent or other payment becomes
due and payable or as a result of acceleration or otherwise, within three
Business Days after the same becomes due;

        (c)  Any Restricted Person fails to duly observe, perform or comply with
any covenant, agreement or provision of Section 6.4 or Article VII made by or on
behalf of such Related Person; provided however, that in the case of
non-consensual Liens not permitted under Section 7.2, such failure remains
unremedied for a period of five (5) days after notice of such failure is given
by Administrative Agent to Borrowers;

        (d)  Any Related Person fails (other than as referred to in subsections
(a), (b) or (c) above) to duly observe, perform or comply with any covenant,
agreement, condition or provision of any Loan Document made by or on behalf of
such Related Person, and such failure remains unremedied for a period of thirty
(30) days after notice of such failure is given by Administrative Agent to
Borrower;

        (e)  Any representation or warranty previously, presently or hereafter
made in writing by or on behalf of any Related Person in connection with any
Loan Document shall prove to have been false or incorrect in any material
respect on any date on or as of which made, or any Loan Document at any time
ceases to be valid, binding and enforceable as warranted in Section 5.5 for any
reason other than its release or subordination by Administrative Agent;

        (f)    Any Related Person shall default in the payment when due of any
principal of or interest on any of its other Indebtedness in excess of
$10,000,000 in the aggregate (other than Indebtedness the validity of which is
being contested in good faith by appropriate proceedings and for which adequate
reserves with respect thereto are maintained on the books of such Related Person
to the extent required by GAAP), or any event specified in any note, agreement,
indenture or other document evidencing or relating to any such Indebtedness
shall occur if the effect of such event is to cause, or (with the giving of any
notice or the lapse of time or both) to permit the holder or holders of such
Indebtedness (or a trustee or agent on behalf of such holder or holders) to
cause, such Indebtedness to become due, or to be prepaid in full (whether by
redemption, purchase, offer to purchase or otherwise), prior to its stated
maturity;

        (g)  Either any "accumulated funding deficiency" (as defined in
Section 412(a) of the Code) in excess of $10,000,000 exists with respect to any
ERISA Plan, whether or not waived by the Secretary of the Treasury or his
delegate, or any Termination Event occurs with respect to any ERISA Plan and the
then current value of such ERISA Plan's benefit liabilities exceeds the then
current value of such ERISA Plan's assets available for the payment of such
benefit liabilities by more than $10,000,000 (or in the case of a Termination
Event involving the withdrawal of a substantial employer, the withdrawing
employer's proportionate share of such excess exceeds such amount);

        (h)  General Partner or any Related Person:

          (i)  has entered against it of a judgment, decree or order for relief
by a Tribunal of competent jurisdiction in an involuntary proceeding commenced
under any applicable bankruptcy, insolvency or other similar Law of any
jurisdiction now or hereafter in effect, including the federal

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Bankruptcy Code, as from time to time amended, or has any such proceeding
commenced against it, in each case, which remains undismissed for a period of
sixty days; or

        (ii)  commences a voluntary case under any applicable bankruptcy,
insolvency or similar Law now or hereafter in effect, including the federal
Bankruptcy Code, as from time to time amended; or applies for or consents to the
entry of an order for relief in an involuntary case under any such Law; or makes
a general assignment for the benefit of creditors; or is generally unable to pay
(or admits in writing its inability to so pay) its debts as such debts become
due; or takes corporate or other action to authorize any of the foregoing; or

        (iii)  has entered against it the appointment of or taking possession by
a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official of all or a substantial part of its assets or any part of the
Collateral in a proceeding brought against or initiated by it, and such
appointment or taking possession is neither made ineffective nor discharged
within sixty days after the making thereof, or such appointment or taking
possession is at any time consented to, requested by, or acquiesced to by it; or

        (iv)  has entered against it a final judgment for the payment of money
in excess of $10,000,000 (in each case not covered by insurance satisfactory to
Administrative Agent in its discretion), unless the same is discharged within
thirty days after the date of entry thereof or an appeal or appropriate
proceeding for review thereof is taken within such period and a stay of
execution pending such appeal is obtained; or

        (v)  suffers a writ or warrant of attachment or any similar process to
be issued by any Tribunal against all or any substantial part of its assets or
any part of the Collateral, and such writ or warrant of attachment or any
similar process is not stayed or released within thirty days after the entry or
levy thereof or after any stay is vacated or set aside; or

        (i)    Any Change in Control occurs.

Upon the occurrence of an Event of Default described in subsection (h)(i),
(h)(ii) or (h)(iii) of this section with respect to Borrower or Pacific Energy
Partners, all of the Obligations shall thereupon be immediately due and payable,
without demand, presentment, notice of demand or of dishonor and nonpayment,
protest, notice of protest, notice of intention to accelerate, declaration or
notice of acceleration, or any other notice or declaration of any kind, all of
which are hereby expressly waived by Borrower and each Restricted Person who at
any time ratifies or approves this Agreement. Upon any such acceleration, any
obligation of any Lender to make any further Loans and any obligation of LC
Issuer to issue Letters of Credit hereunder shall be permanently terminated.
During the continuance of any other Event of Default, Administrative Agent at
any time and from time to time may (and upon written instructions from Majority
Lenders, Administrative Agent shall), without notice to Borrower or any other
Restricted Person, do either or both of the following: (1) terminate any
obligation of Lenders to make Loans hereunder and any obligation of LC Issuer to
issue Letters of Credit hereunder, and (2) declare any or all of the Obligations
immediately due and payable, and all such Obligations shall thereupon be
immediately due and payable, without demand, presentment, notice of demand or of
dishonor and nonpayment, protest, notice of protest, notice of intention to
accelerate, declaration or notice of acceleration, or any other notice or
declaration of any kind, all of which are hereby expressly waived by Borrower
and each Restricted Person who at any time ratifies or approves this Agreement.

        Section 8.2.    Remedies.    If any Event of Default shall occur and be
continuing, Majority Lenders or Administrative Agent, at the direction of
Majority Lenders, may proceed (or direct Administrative Agent to proceed) to
protect and enforce its rights under the Loan Documents by any appropriate
proceedings, including proceedings for specific performance of any covenant or
agreement contained in any Loan Document. All rights, remedies and powers
conferred upon Lender Parties under the Loan

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Documents shall be deemed cumulative and not exclusive of any other rights,
remedies or powers available under the Loan Documents or at Law or in equity.

        Section 8.3.    Application of Proceeds after Acceleration.    If
Administrative Agent collects or receives money on account of the Obligations
after the acceleration of the Obligations as provided in Section 8.1,
Administrative Agent shall distribute all money so collected or received:

        (a)  first to any reimbursements due Administrative Agent hereunder or
under any of the Security Documents; and

        (b)  then ratably to the payment of the Obligations, including LC
Obligations (and among the outstanding Obligations in the manner provided in
Section 3.1), and the Lender Hedging Obligations.

        Notwithstanding the foregoing provisions of this Article VIII, to the
extent that the exercise by the Lenders of their rights or remedies under this
Article VIII with respect to the Collateral would result in a change of control
of any PUC Restricted Subsidiary, such exercise is subject to filing with and
prior approval of the applicable PUC as may be required in respect of a
regulated utility under such agency's regulations.

ARTICLE IX—Administrative Agent

        Section 9.1.    Appointment and Authority.    Each Lender Party hereby
irrevocably authorizes Administrative Agent, and Administrative Agent hereby
undertakes, to receive payments of principal, interest and other amounts due
hereunder as specified herein and to take all other actions and to exercise such
powers under the Loan Documents as are specifically delegated to Administrative
Agent by the terms hereof or thereof, together with all other powers reasonably
incidental thereto. The relationship of Administrative Agent to the other Lender
Parties is only that of one commercial lender acting as administrative agent for
others, and nothing in the Loan Documents shall be construed to constitute
Administrative Agent a trustee or other fiduciary for any Lender Party or any
holder of any participation in a Note nor to impose on Administrative Agent
duties and obligations other than those expressly provided for in the Loan
Documents. With respect to any matters not expressly provided for in the Loan
Documents and any matters which the Loan Documents place within the discretion
of Administrative Agent, Administrative Agent shall not be required to exercise
any discretion or take any action, and it may request instructions from Lenders
with respect to any such matter, in which case it shall be required to act or to
refrain from acting (and shall be fully protected and free from liability to all
Lender Parties in so acting or refraining from acting) upon the instructions of
Majority Lenders (including itself), provided, however, that Administrative
Agent shall not be required to take any action which exposes it to a risk of
personal liability that it considers unreasonable or which is contrary to the
Loan Documents or to applicable Law. Upon receipt by Administrative Agent from
Borrower of any communication calling for action on the part of Lenders or upon
notice from Borrower or any Lender to Administrative Agent of any Default or
Event of Default, Administrative Agent shall promptly notify each other Lender
thereof.

        Section 9.2.    Exculpation, Administrative Agent's Reliance,
Etc.    Neither Administrative Agent nor any of its directors, officers, agents,
attorneys, or employees shall be liable for any action taken or omitted to be
taken by any of them under or in connection with the Loan Documents, INCLUDING
THEIR NEGLIGENCE OF ANY KIND, except that each shall be liable for its own gross
negligence or willful misconduct. Without limiting the generality of the
foregoing, Administrative Agent (a) may treat the payee of any Note as the
holder thereof until Administrative Agent receives written notice of the
assignment or transfer thereof in accordance with this Agreement, signed by such
payee and in form satisfactory to Administrative Agent; (b) may consult with
legal counsel (including counsel for Borrower), independent public accountants
and other experts selected by it and shall not be liable for any action taken or
omitted to be taken in good faith by it in accordance with the advice of such

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counsel, accountants or experts; (c) makes no warranty or representation to any
other Lender Party and shall not be responsible to any other Lender Party for
any statements, warranties or representations made in or in connection with the
Loan Documents; (d) shall not have any duty to ascertain or to inquire as to the
performance or observance of any of the terms, covenants or conditions of the
Loan Documents on the part of any Restricted Person or to inspect the property
(including the books and records) of any Restricted Person; (e) shall not be
responsible to any other Lender Party for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of any Loan Document or any
instrument or document furnished in connection therewith; (f) may rely upon the
representations and warranties of each Restricted Person or Lender Party in
exercising its powers hereunder; and (g) shall incur no liability under or in
respect of the Loan Documents by acting upon any notice, consent, certificate or
other instrument or writing (including any facsimile, telegram, cable or telex)
believed by it to be genuine and signed or sent by the proper Person or Persons.

        Section 9.3.    Credit Decisions.    Each Lender Party acknowledges that
it has, independently and without reliance upon any other Lender Party, made its
own analysis of Borrower and the transactions contemplated hereby and its own
independent decision to enter into this Agreement and the other Loan Documents.
Each Lender Party also acknowledges that it will, independently and without
reliance upon any other Lender Party and based on such documents and information
as it shall deem appropriate at the time, continue to make its own credit
decisions in taking or not taking action under the Loan Documents.

        Section 9.4.    Indemnification.    EACH LENDER AGREES TO INDEMNIFY
ADMINISTRATIVE AGENT (TO THE EXTENT NOT REIMBURSED BY BORROWER WITHIN TEN
(10) DAYS AFTER DEMAND) FROM AND AGAINST SUCH LENDER'S PERCENTAGE SHARE OF ANY
AND ALL LIABILITIES, OBLIGATIONS, CLAIMS, LOSSES, DAMAGES, PENALTIES, FINES,
ACTIONS, JUDGMENTS, SUITS, SETTLEMENTS, COSTS, EXPENSES OR DISBURSEMENTS
(INCLUDING REASONABLE FEES OF ATTORNEYS, ACCOUNTANTS, EXPERTS AND ADVISORS) OF
ANY KIND OR NATURE WHATSOEVER (IN THIS SECTION COLLECTIVELY CALLED "LIABILITIES
AND COSTS") WHICH TO ANY EXTENT (IN WHOLE OR IN PART) MAY BE IMPOSED ON,
INCURRED BY, OR ASSERTED AGAINST ADMINISTRATIVE AGENT GROWING OUT OF, RESULTING
FROM OR IN ANY OTHER WAY ASSOCIATED WITH THE COLLATERAL, ANY OF THE LOAN
DOCUMENTS AND THE TRANSACTIONS AND EVENTS (INCLUDING THE ENFORCEMENT THEREOF) AT
ANY TIME ASSOCIATED THEREWITH OR CONTEMPLATED THEREIN (WHETHER ARISING IN
CONTRACT OR IN TORT OR OTHERWISE AND INCLUDING ANY VIOLATION OR NONCOMPLIANCE
WITH ANY ENVIRONMENTAL LAWS BY ANY PERSON OR ANY LIABILITIES OR DUTIES OF ANY
PERSON WITH RESPECT TO HAZARDOUS MATERIALS FOUND IN OR RELEASED INTO THE
ENVIRONMENT).

        THE FOREGOING INDEMNIFICATION SHALL APPLY WHETHER OR NOT SUCH
LIABILITIES AND COSTS ARE IN ANY WAY OR TO ANY EXTENT OWED, IN WHOLE OR IN PART,
UNDER ANY CLAIM OR THEORY OF STRICT LIABILITY OR CAUSED, IN WHOLE OR IN PART, BY
ANY NEGLIGENT ACT OR OMISSION OF ANY KIND BY ADMINISTRATIVE AGENT,

provided only that no Lender shall be obligated under this section to indemnify
Administrative Agent for that portion, if any, of any liabilities and costs
which is proximately caused by Administrative Agent's own individual gross
negligence or willful misconduct, as determined in a final judgment. Cumulative
of the foregoing, each Lender agrees to reimburse Administrative Agent promptly
upon demand for such Lender's Percentage Share of any costs and expenses to be
paid to Administrative Agent by Borrower under Section 10.4(a) to the extent
that Administrative Agent is not timely reimbursed for such expenses by Borrower
as provided in such section. As used in this section the term "Administrative
Agent" shall refer not only to the Person designated as such in Section 1.1 but
also to each director, officer, agent, attorney, employee, representative and
Affiliate of such Person.

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        Section 9.5.    Rights as Lender.    In its capacity as a Lender,
Administrative Agent shall have the same rights and obligations as any Lender
and may exercise such rights as though it were not Administrative Agent.
Administrative Agent may accept deposits from, lend money to, act as trustee
under indentures of, and generally engage in any kind of business with any
Restricted Person or their Affiliates, all as if it were not Administrative
Agent hereunder and without any duty to account therefor to any other Lender.

        Section 9.6.    Sharing of Set-Offs and Other Payments.    Each Lender
Party agrees that if it shall, whether through the exercise of rights under
Security Documents or rights of banker's lien, set off, or counterclaim against
Borrower or otherwise, obtain payment of a portion of the aggregate Obligations
owed to it which, taking into account all distributions made by Administrative
Agent under Section 3.1, causes such Lender Party to have received more than it
would have received had such payment been received by Administrative Agent and
distributed pursuant to Section 3.1, then (a) it shall be deemed to have
simultaneously purchased and shall be obligated to purchase interests in the
Obligations as necessary to cause all Lender Parties to share all payments as
provided for in Section 3.1, and (b) such other adjustments shall be made from
time to time as shall be equitable to ensure that Administrative Agent and all
Lender Parties share all payments of Obligations as provided in Section 3.1;
provided, however, that nothing herein contained shall in any way affect the
right of any Lender Party to obtain payment (whether by exercise of rights of
banker's lien, set-off or counterclaim or otherwise) of indebtedness other than
the Obligations. Borrower expressly consents to the foregoing arrangements and
agrees that any holder of any such interest or other participation in the
Obligations, whether or not acquired pursuant to the foregoing arrangements, may
to the fullest extent permitted by Law and, subject to the provisions of
Section 6.16, exercise any and all rights of banker's lien, set-off, or
counterclaim as fully as if such holder were a holder of the Obligations in the
amount of such interest or other participation. If all or any part of any funds
transferred pursuant to this section is thereafter recovered from the seller
under this section which received the same, the purchase provided for in this
section shall be deemed to have been rescinded to the extent of such recovery,
together with interest, if any, if interest is required pursuant to the order of
a Tribunal to be paid on account of the possession of such funds prior to such
recovery.

        Section 9.7.    Investments.    Whenever Administrative Agent in good
faith determines that it is uncertain about how to distribute to Lender Parties
any funds which it has received, or whenever Administrative Agent in good faith
determines that there is any dispute among Lender Parties about how such funds
should be distributed, Administrative Agent may choose to defer distribution of
the funds which are the subject of such uncertainty or dispute. If
Administrative Agent in good faith believes that the uncertainty or dispute will
not be promptly resolved, or if Administrative Agent is otherwise required to
invest funds pending distribution to Lender Parties, Administrative Agent shall
invest such funds pending distribution; all interest on any such Investment
shall be distributed upon the distribution of such Investment and in the same
proportion and to the same Persons as such Investment. All moneys received by
Administrative Agent for distribution to Lender Parties (other than to the
Person who is Administrative Agent in its separate capacity as a Lender Party)
shall be held by Administrative Agent pending such distribution solely as
Administrative Agent for such Lender Parties, and Administrative Agent shall
have no equitable title to any portion thereof.

        Section 9.8.    Benefit of Article IX.    The provisions of this Article
are intended solely for the benefit of Lender Parties, and no Restricted Person
shall be entitled to rely on any such provision or assert any such provision in
a claim or defense against any Lender (other than in relation to the reference
to Section 6.16 contained in Section 9.6 or the right to reasonably approve a
successor Administrative Agent under Section 9.9). Lender Parties may waive or
amend such provisions as they desire without any notice to or consent of
Borrower or any other Restricted Person.

        Section 9.9.    Resignation.    Administrative Agent may resign at any
time by giving written notice thereof to Lenders and Borrower. Each such notice
shall set forth the date of such resignation. Upon

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any such resignation Majority Lenders shall have the right to appoint a
successor Administrative Agent, subject to the approval of Borrower, unless a
Default has occurred and is continuing, which approval will not be unreasonably
withheld. A successor must be appointed for any retiring Administrative Agent,
and such Administrative Agent's resignation shall become effective when such
successor accepts such appointment. If, within thirty days after the date of the
retiring Administrative Agent's resignation, no successor Administrative Agent
has been appointed and has accepted such appointment, then the retiring
Administrative Agent may appoint a successor Administrative Agent, which shall
be a commercial bank organized or licensed to conduct a banking or trust
business under the Laws of the United States of America or of any state thereof.
Upon the acceptance of any appointment as Administrative Agent hereunder by a
successor Administrative Agent, the retiring Administrative Agent shall be
discharged from its duties and obligations under this Agreement and the other
Loan Documents. After any retiring Administrative Agent's resignation hereunder
the provisions of this Article IX shall continue to inure to its benefit as to
any actions taken or omitted to be taken by it while it was Administrative Agent
under the Loan Documents.

        Section 9.10.    Other Agents.    Neither the Syndication Agent nor the
Co-Documentation Agents ("Co-Agents"), in such capacities, shall have any duties
or responsibilities or incur any liabilities in such agency capacities (as
opposed to its capacity as a Lender) under or in connection with this Agreement
or under any of the other Loan Documents. The relationship between Borrower, on
the one hand, and the Co-Agents and Administrative Agent, on the other hand,
shall be solely that of borrower and lender. None of the Co-Agents shall have
any fiduciary responsibilities to Borrower or any of its Affiliates. None of the
Co-Agents undertakes any responsibility to Borrower or any of its respective
Affiliates to review or inform Borrower of any matter in connection with any
phase of Borrower's or such Affiliate's business or operations.

ARTICLE X—Miscellaneous

        Section 10.1.    Amendment and Consents.    

        Except to the extent otherwise expressly provided for herein or therein,
no amendment or waiver of any provision of this Agreement or any of the other
Loan Documents, nor consent to any departure by any of the Restricted Persons
therefrom, shall in any event be effective unless the same shall be in writing
and signed by Majority Lenders, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given; provided, however, that:

        (a)  no amendment, waiver or consent shall, unless in writing and signed
by all of the Lenders, do any of the following at any time:

          (i)  waive any of the conditions specified in Section 4.1;

        (ii)  except to the extent contemplated herein, release all or
substantially all of the Subsidiaries that are a party to a Guaranty from their
Obligations thereunder or release all or substantially all of the Collateral;

        (iii)  amend this Section 10.1 or the definition of Majority Lenders; or

        (iv)  permit the Borrower to select an Interest Period having a duration
longer than six months;

        (b)  no amendment, waiver or consent shall, unless in writing and signed
by the Majority Lenders and each Lender affected by such amendment, waiver or
consent:

          (i)  increase the Revolver Commitment or Term Commitment of such
Lender; or

        (ii)  change the order of application of any prepayment set forth in
Section 2.5 or

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        Section 2.6 in any manner that materially affects such Lender;

        (c)  no amendment, waiver or consent shall, unless in writing and signed
by each of the Revolver Lenders (without the necessity of the signatures of
Majority Lenders):

          (i)  reduce, forgive or waive the principal of, or interest on, the
Revolver Notes or any fees or other amounts payable hereunder to Revolver
Lenders; or

        (ii)  postpone, waive or otherwise defer any date scheduled for any
payment of principal of or interest on the Revolver Notes or any fees or other
amounts payable to Revolver Lenders;

        (d)  no amendment, waiver or consent shall, unless in writing and signed
by each of the Term Lenders (without the necessity of the signatures of Majority
Lenders):

          (i)  reduce, forgive or waive the principal of, or interest on, the
Term Notes or any fees or other amounts payable hereunder to Term Lenders; or

        (ii)  postpone, waive or otherwise defer any date scheduled for any
payment of principal of or interest on the Term Notes or any fees or other
amounts payable to Term Lenders;

        (e)  no amendment, waiver or consent shall, unless in writing and signed
by Revolver Lenders whose Revolver Percentage Shares exceed 50% waive any of the
conditions specified in Section 4.2 or Section 4.3 to a Revolving Loan or the
issuance of a Letter of Credit;

provided further that no amendment, waiver or consent shall, unless in writing
and signed by the LC Issuer, in addition to the Lenders required above to take
such action, affect the rights or duties of the LC Issuer under this Agreement
or any of the other Loan Documents; and provided furtherthat no amendment,
waiver or consent shall, unless in writing and signed by the Administrative
Agent in addition to the Lenders required above to take such action, affect the
rights or duties of the Administrative Agent under this Agreement or any of the
other Loan Documents. Notwithstanding any of the foregoing provisions of this
Section 10.1, (a) Administrative Agent may release Collateral relating to sales
or transfers of property as permitted under Section 7.5, and (b) none of the
defined terms set forth in Section 1.1 shall be amended, supplemented or
otherwise modified hereafter in any manner that would change the meaning,
purpose or effect of this Section 10.1 or any Section referred to herein unless
such amendment, supplement or modification is agreed to in writing by the number
and percentage of Lenders (and the LC Issuer and Administrative Agent, in each
case if applicable) otherwise required to amend such Section under the terms of
this Section 10.1.

        Section 10.2.    Survival of Agreements; Cumulative Nature.    All of
Restricted Persons' various representations, warranties, covenants and
agreements in the Loan Documents shall survive the execution and delivery of
this Agreement and the other Loan Documents and the performance hereof and
thereof, including the making or granting of the Loans and the delivery of the
Notes and the other Loan Documents, and shall further survive until all of the
Obligations are paid in full to each Lender Party and all of Lender Parties'
obligations to Borrower are terminated. All statements and agreements contained
in any certificate or other instrument delivered by any Restricted Person to any
Lender Party under any Loan Document shall be deemed representations and
warranties by Borrower or agreements and covenants of Borrower under this
Agreement. The representations, warranties, indemnities, and covenants made by
Restricted Persons in the Loan Documents, and the rights, powers, and privileges
granted to Lender Parties in the Loan Documents, are cumulative, and, except for
expressly specified waivers and consents, no Loan Document shall be construed in
the context of another to diminish, nullify, or otherwise reduce the benefit to
any Lender Party of any such representation, warranty, indemnity, covenant,
right, power or privilege. In particular and without limitation, no exception
set out in this Agreement to any representation, warranty, indemnity, or
covenant herein contained shall apply to any similar representation, warranty,
indemnity, or covenant contained in any other Loan Document,

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and each such similar representation, warranty, indemnity, or covenant shall be
subject only to those exceptions which are expressly made applicable to it by
the terms of the various Loan Documents.

        Section 10.3.    Notices.    All notices, requests, consents, demands
and other communications required or permitted under any Loan Document shall be
in writing, unless otherwise specifically provided in such Loan Document
(provided that Administrative Agent may give telephonic notices to the other
Lender Parties), and shall be deemed sufficiently given or furnished if
delivered by personal delivery, by facsimile or other electronic transmission,
by delivery service with proof of delivery, or by registered or certified United
States mail, postage prepaid, to Borrower and Restricted Persons at the address
of Borrower specified on the signature pages hereto and to each Lender Party at
its address specified on the signature pages hereto (unless changed by similar
notice in writing given by the particular Person whose address is to be
changed). Any such notice or communication shall be deemed to have been given
(a) in the case of personal delivery or delivery service, as of the date of
first attempted delivery during normal business hours at the address provided
herein, (b) in the case of facsimile or other electronic transmission, the
Business Day it is sent and confirmed (if sent before 5:00 p.m. local time of
the receiving party) or the next Business Day (if sent after 5:00 p.m. local
time of the receiving party), or (c) in the case of registered or certified
United States mail, three days after deposit in the mail; provided, however,
that no Borrowing Notice or Continuation/Conversion Notice shall become
effective until actually received by Administrative Agent. Electronic mail may
be used only to distribute routine communications, such as financial statements
and other information, and to distribute Loan Documents for execution by the
parties thereto, and shall not be recognized hereunder for any other purpose.

        Section 10.4.    Payment of Expenses; Indemnity.    

        (a)    Payment of Expenses.    Whether or not the transactions
contemplated by this Agreement are consummated, Borrower will promptly (and in
any event, within 30 days after any invoice or other statement or notice) pay:
(i) all transfer, stamp, mortgage, documentary or other similar taxes,
assessments or charges levied by any governmental or revenue authority in
respect of this Agreement or any of the other Loan Documents or any other
document referred to herein or therein, (ii) all reasonable out of pocket third
party costs and expenses incurred by or on behalf of Administrative Agent
(including attorneys' fees, consultants' fees and engineering fees) in
connection with (1) the negotiation, preparation, execution and delivery of the
Loan Documents, and any and all consents, waivers or other documents or
instruments relating thereto, (2) the filing, recording, refiling and
re-recording of any Loan Documents and any other documents or instruments or
further assurances required to be filed or recorded or refiled or re-recorded by
the terms of any Loan Document, (3) the borrowings hereunder and other action
reasonably required in the course of administration hereof, (4) monitoring or
confirming (or preparation or negotiation of any document related to) any
Related Person's compliance with any covenants or conditions contained in this
Agreement or in any Loan Document, and (iii) all reasonable out of pocket third
party costs and expenses incurred by or on behalf of any Lender Party (including
attorneys' fees, consultants' fees and accounting fees) in connection with the
defense or enforcement of any of the Loan Documents (including this section),
any attempt to cure any breach thereunder by any Related Person or the defense
of any Lender Party's exercise of its rights thereunder.

        (b)    Indemnity.    Borrower agrees to indemnify each Lender Party,
upon demand, from and against any and all liabilities, obligations, claims,
losses, damages, penalties, fines, actions, judgments, suits, settlements,
costs, expenses or disbursements (including reasonable fees of attorneys,
accountants, experts and advisors) of any kind or nature whatsoever (in this
section collectively called "liabilities and costs") which to any extent (in
whole or in part) may be imposed on, incurred by, or asserted against such
Lender Party growing out of, resulting from or in any other way associated with
the Collateral, the Loan Documents and the transactions and events (including
the enforcement or defense thereof) at any time associated therewith or
contemplated therein whether arising in contract or in tort or otherwise

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and including any violation or noncompliance with any Environmental Laws by any
Lender Party or any other Person or any liabilities or duties of any Lender
Party or any other Person with respect to Hazardous Materials found in or
released into the environment).

        THE FOREGOING INDEMNIFICATION SHALL APPLY WHETHER OR NOT SUCH
LIABILITIES AND COSTS ARE IN ANY WAY OR TO ANY EXTENT OWED, IN WHOLE OR IN PART,
UNDER ANY CLAIM OR THEORY OF STRICT LIABILITY OR CAUSED, IN WHOLE OR IN PART, BY
ANY NEGLIGENT ACT OR OMISSION OF ANY KIND BY ANY LENDER PARTY,

provided only that no Lender Party shall be entitled under this section to
receive indemnification for that portion, if any, of any liabilities and costs
which is proximately caused by its own individual gross negligence or willful
misconduct, as determined in a final judgment. If any Person (including Borrower
or any of its Affiliates) ever alleges such gross negligence or willful
misconduct by any Lender Party, the indemnification provided for in this section
shall nonetheless be paid upon demand, subject to later adjustment or
reimbursement, until such time as a court of competent jurisdiction enters a
final judgment as to the extent and effect of the alleged gross negligence or
willful misconduct. As used in this section the term "Lender Party" shall refer
not only to each Person designated as such in Section 1.1 but also to
Syndication Agent, Co-Documentation Agents, Co-Arrangers, Co-Book Managers and
each director, officer, agent, attorney, employee, representative and Affiliate
of each Lender Party and each such Person.

        Section 10.5.    Joint and Several Liability; Parties in Interest;
Assignments; Replacement Notes.    

        (a)  All Obligations which are incurred by two or more Restricted
Persons shall be their joint and several obligations and liabilities unless
otherwise required pursuant to a regulatory approval as specified in
Section 6.13. All grants, covenants and agreements contained in the Loan
Documents shall bind and inure to the benefit of the parties thereto and their
respective successors and permitted assigns; provided, however, that no
Restricted Person may assign or transfer any of its rights or delegate any of
its duties or obligations under any Loan Document without the prior consent of
all Lenders. Neither Borrower nor any Affiliates of Borrower shall directly or
indirectly purchase or otherwise retire any Obligations owed to any Lender nor
will any Lender accept any offer to do so, unless each Lender shall have
received substantially the same offer with respect to the same Percentage Share
of the Obligations owed to it. If Borrower or any Affiliate of Borrower at any
time purchases some but less than all of the Obligations owed to all Lender
Parties, such purchaser shall not be entitled to any rights of any Lender under
the Loan Documents unless and until Borrower or its Affiliates have purchased
all of the Obligations.

        (b)  No Lender shall sell any participation interest in its commitment
hereunder or any of its rights under its Loans or under the Loan Documents to
any Person unless the agreement between such Lender and such participant at all
times provides: (i) that such participation exists only as a result of the
agreement between such participant and such Lender and that such transfer does
not give such participant any right to vote as a Lender or any other direct
claims or rights against any Person other than such Lender, (ii) that such
participant is not entitled to payment from any Restricted Person under Sections
3.2 through 3.7 of amounts in excess of those payable to such Lender under such
sections (determined without regard to the sale of such participation), and
(iii) unless such participant is an Affiliate of such Lender, that such
participant shall not be entitled to require such Lender to take any action
under any Loan Document or to obtain the consent of such participant prior to
taking any action under any Loan Document, except for actions which would
require the consent of all Lenders under subsection (a) of Section 10.1. No
Lender selling such a participation shall, as between the other parties hereto
and such Lender, be relieved of any of its obligations hereunder as a result of
the sale of such participation. Each Lender which sells any such participation
to any Person (other than an Affiliate of such Lender) shall give prompt notice
thereof to Administrative Agent and Borrower; provided, however, that no
liability shall arise if any Lender fails to give such notice to Borrower.

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        (c)  Except for sales of participations under the immediately preceding
subsection, no Lender shall make any assignment or transfer of any kind of its
commitments or any of its rights under its Loans or under the Loan Documents,
except for assignments to an Eligible Transferee, or, subject to the provisions
of subsection (g) below, to an Affiliate and then only if such assignment is
made in accordance with the following requirements:

          (i)  In the case of an assignment by a Revolver Lender of less than
all of its Revolver Loans, LC Obligations, and Revolver Commitments, each such
assignment shall apply to a consistent percentage of all Revolver Loans and LC
Obligations owing to the assignor Revolver Lender hereunder and to the same
percentage of the unused portion of the assignor Revolver Lender's Revolver
Commitments, so that after such assignment is made both the assignee Revolver
Lender and the assignor Revolver Lender shall have a fixed (and not a varying)
Revolver Percentage Share in its Revolver Loans and LC Obligations and be
committed to make that Revolver Percentage Share of all future Revolver Loans
and make that Revolver Percentage Share of all future participations in LC
Obligations, and the Revolver Commitment of the assignee shall equal or exceed
$5,000,000;

        (ii)  In the case of an assignment by a Term Lender, after such
assignment is made the outstanding Term Loans of the assignee shall equal or
exceed $1,000,000, except with respect to an assignment of all such Lender's
Term Loans or such lesser amount as may be agreed to by the Administrative Agent
and Borrower (except that no such minimum shall be applicable with respect to an
assignment to a Lender);

        (iii)  The parties to each such assignment shall execute and deliver to
Administrative Agent, for its acceptance and recording in the "Register" (as
defined below in this section), an Assignment and Acceptance in the form of
Exhibit E, appropriately completed, together with the Note subject to such
assignment and a processing fee payable by such assignor Lender (and not at
Borrower's expense) to Administrative Agent of $3,500. Upon such execution,
delivery, and payment and upon the satisfaction of the conditions set out in
such Assignment and Acceptance, then (i) Borrower shall issue new Notes to such
assignor and assignee upon return of the old Notes to Borrower, and (ii) as of
the "Settlement Date" specified in such Assignment and Acceptance the assignee
thereunder shall be a party hereto and a Lender hereunder and Administrative
Agent shall thereupon deliver to Borrower and each Lender a revised Schedule 1
hereto showing the revised Revolver Percentage Shares and Percentage Shares of
such assignor Lender and such assignee Lender and the Revolver Percentage Shares
and Percentage Shares of all other Lenders; and

        (iv)  Each assignee Lender which is not a United States person (as such
term is defined in Section 7701(a)(30) of the Code) for Federal income tax
purposes, shall (to the extent it has not already done so) provide
Administrative Agent and Borrower with the "Prescribed Forms" referred to in
Section 3.7(d).

        (d)  Any Lender may at any time pledge all or any portion of its Loans
and Notes (and related rights under the Loan Documents including any portion of
its Notes) to any of the twelve (12) Federal Reserve Banks organized under
Section 4 of the Federal Reserve Act, 12 U.S.C. Section 341. No such pledge or
enforcement thereof shall release any such Lender from its obligations under any
of the Loan Documents; provided that all related costs, fees and expenses in
connection with any such pledge shall be for the sole account of such Lender. In
addition, any Term Lender may at any time, without consent of Borrower or
Administrative Agent, pledge all or any portion of its Term Loan to any trustee
or holder (or other representative of such holder) (for purpose of this
Section 10.5(d), each such trustee, holder or representative is referred to as a
"pledgee") of obligations owed, or debt securities issued by, such Term Lender,
as security for such obligations or debt securities; provided that (i) the
agreement between such Term Lender and such pledgee at all times provides that
such pledge does not

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give such pledgee any right to vote as a Lender or any other direct claims or
rights against any Person other than such pledging Term Lender, and imposes no
obligations on the part of Borrower or Administrative Agent, (ii) no such pledge
(or enforcement thereof) shall release any such pledging Term Lender from its
obligations under any of the Loan Documents or permit or authorize any Person to
become a Lender unless it has complied with Section 10.5(c), and (iii) all
related costs, fees and expenses in connection with any such pledge shall be for
the sole account of such pledging Term Lender.

        (e)  By executing and delivering an Assignment and Acceptance, each
assignee Lender thereunder will be confirming to and agreeing with Borrower,
Administrative Agent and each other Lender Party that such assignee understands
and agrees to the terms hereof, including Article IX hereof.

        (f)    Administrative Agent shall maintain a copy of each Assignment and
Acceptance and a register for the recordation of the names and addresses of
Lenders and the Percentage Shares of, and principal amount of the Loans owing
to, each Lender from time to time (in this section called the "Register"). The
entries in the Register shall be conclusive, in the absence of manifest error,
and Borrower and each Lender Party may treat each Person whose name is recorded
in the Register as a Lender Party hereunder for all purposes. The Register shall
be available for inspection by Borrower or any Lender Party at any reasonable
time and from time to time upon reasonable prior notice.

        (g)  Any Lender may assign or transfer its commitment or its rights
under its Loans or under the Loan Documents to (i) any Affiliate that is
wholly-owned direct or indirect subsidiary of such Lender or of any Person that
wholly owns, directly or indirectly, such Lender, or (ii) if such Lender is a
fund that invests in bank loans, any other fund that invests in bank loans and
is advised, administered, or managed by (A) the same investment advisor as any
Lender or (B) any Affiliate of such investment advisor that is a wholly-owned
direct or indirect subsidiary of any Person that wholly owns, directly or
indirectly, such investment advisor, subject to the following additional
conditions (x), (y) and (z), with respect to assignments pursuant to clause (i)
above, and subject to the following additional conditions (y) and (z) with
respect to assignments pursuant to clause (ii) above:

        (x)  any right of such Lender assignor and such assignee to vote as a
Lender, or any other direct claims or rights against any other Persons, shall be
uniformly exercised or pursued in the manner that such Lender assignor would
have so exercised such vote, claim or right if it had not made such assignment
or transfer;

        (y)  such assignee shall not be entitled to payment from any Restricted
Person under Sections 3.2 through 3.7 of amounts in excess of those payable to
such Lender assignor under such sections (determined without regard to such
assignment or transfer); and

        (z)  if such Lender assignor is a Revolver Lender that assigns or
transfers to such assignee any of such Revolver Lender's Revolver Commitment,
such assignee may become primarily liable for such Revolver Commitment, but such
assignment or transfer shall not relieve or release such Revolver Lender from
such Revolver Commitment.

        (h)  Upon receipt of an affidavit reasonably satisfactory to Borrower of
an officer of any Lender as to the loss, theft, destruction or mutilation of any
of such Lender's Note or any Security Document which is not of public record,
and, in the case of any such loss, theft, destruction or mutilation, upon
cancellation of such Note or such Security Document, Borrower will execute and
deliver, in lieu thereof, a replacement Note in the same principal amount
thereof and otherwise of like tenor (or each Restricted Person a party to any
such Security Document will execute and deliver a replacement Security Document
of like tenor).

        Section 10.6.    Confidentiality.    Each Lender Party agrees (on behalf
of itself and each of its Affiliates, and each of its and their directors,
officers, agents, attorneys, employees, and representatives and for which such
Lender Party shall be responsible) that it (and each of them) will take all

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reasonable steps to keep confidential any non-public information supplied to it
by or at the direction of any Related Person so identified when delivered,
provided, however, that this restriction shall not apply to (a) information
which has at the time in question entered the public domain, (b) any disclosure
which is required to be made by Law (whether valid or invalid) of any Tribunal,
provided that, in making such disclosure such Lender Party discloses only that
portion thereof that such Lender Party determines is required to be disclosed,
promptly notifies Borrower thereof and supports Borrower in any intervention by
the Related Persons, (c) any disclosure to any Lender Party's Affiliates,
auditors, attorneys, or agents who such Lender Party determines have a bona fide
need to know and who have been made aware of this obligation of confidentiality,
(d) any disclosure to any other Lender Party or to any purchaser or prospective
purchaser of participations or other interests in any Loan or Loan Document
(provided each such Person first agrees to hold such information in confidence
on the terms provided in this Section 10.6), or (e) any disclosure in the course
of enforcing its rights and remedies during the existence of an Event of
Default.

        Section 10.7.    Bank Accounts; Offset.    Each Lender shall have a
right of offset, each of which shall be in addition to all other interests,
liens, and rights of any Lender at common Law, under the Loan Documents, or
otherwise, and each of which shall be upon and against any and all moneys,
securities or other property (and the proceeds therefrom) of such Restricted
Person now or hereafter held or received by or in transit to any Lender from or
for the account of such Restricted Person, whether for safekeeping, custody,
pledge, transmission, collection or otherwise, any and all deposits (general or
special, time or demand, provisional or final) of such Restricted Person with
any Lender, and any other credits and claims of such Restricted Person at any
time existing against any Lender, including claims under certificates of
deposit. At any time and from time to time during the continuance of any Event
of Default, each Lender is hereby authorized to offset against the Obligations
then due and payable (in either case without prior notice to any Restricted
Person), any and all items hereinabove referred to. Each Lender agrees to
promptly notify such Restricted Person and the Administrative Agent after any
such set-off and application made by such Lender; provided, however, that the
failure to give such notice shall not affect the validity of such set-off and
application. The remedies of foreclosure and offset are separate and cumulative,
and either may be exercised independently of the other without regard to
procedures or restrictions applicable to the other.

        Section 10.8.    Governing Law; Submission to Process.    EXCEPT TO THE
EXTENT THAT THE LAW OF ANOTHER JURISDICTION IS EXPRESSLY ELECTED IN A LOAN
DOCUMENT, THE LOAN DOCUMENTS SHALL BE DEEMED CONTRACTS AND INSTRUMENTS MADE
UNDER THE LAWS OF THE STATE OF NEW YORK AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK AND THE LAWS
OF THE UNITED STATES OF AMERICA, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAW. BORROWER HEREBY AGREES THAT ANY LEGAL ACTION OR PROCEEDING AGAINST BORROWER
WITH RESPECT TO THIS AGREEMENT, THE NOTES OR ANY OF THE LOAN DOCUMENTS MAY BE
BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES OF
AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK AS LENDER PARTIES MAY ELECT, AND,
BY EXECUTION AND DELIVERY HEREOF, BORROWER ACCEPTS AND CONSENTS FOR ITSELF AND
IN RESPECT TO ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE NON-EXCLUSIVE
JURISDICTION OF THE AFORESAID COURTS. BORROWER AGREES THAT SECTIONS 5-1401 AND
5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK SHALL APPLY TO
THE LOAN DOCUMENTS AND WAIVES ANY RIGHT TO STAY OR TO DISMISS ANY ACTION OR
PROCEEDING BROUGHT BEFORE SAID COURTS ON THE BASIS OF FORUM NON CONVENIENS. IN
FURTHERANCE OF THE FOREGOING, BORROWER HEREBY IRREVOCABLY DESIGNATES AND
APPOINTS CORPORATION SERVICE COMPANY, 80 STATE STREET, ALBANY, NEW YORK 12207,
AS AGENT OF BORROWER TO RECEIVE SERVICE OF ALL PROCESS BROUGHT AGAINST BORROWER
WITH RESPECT TO ANY SUCH PROCEEDING IN ANY SUCH COURT IN NEW YORK, SUCH SERVICE
BEING HEREBY ACKNOWLEDGED BY BORROWER TO BE EFFECTIVE AND BINDING SERVICE IN
EVERY RESPECT. COPIES OF ANY SUCH PROCESS SO SERVED SHALL ALSO BE SENT BY
REGISTERED MAIL TO BORROWER AT ITS ADDRESS SET FORTH BELOW, BUT THE FAILURE OF
BORROWER TO RECEIVE SUCH COPIES SHALL NOT AFFECT IN ANY WAY THE SERVICE OF SUCH
PROCESS AS AFORESAID.

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BORROWER SHALL FURNISH TO LENDER PARTIES A CONSENT OF CORPORATION SERVICE
COMPANY AGREEING TO ACT HEREUNDER PRIOR TO THE EFFECTIVE DATE OF THIS AGREEMENT.
NOTHING HEREIN SHALL AFFECT THE RIGHT OF LENDER PARTIES TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF LENDER PARTIES TO
BRING PROCEEDINGS AGAINST BORROWER IN THE COURTS OF ANY OTHER JURISDICTION. IF
FOR ANY REASON CORPORATION SERVICE COMPANY SHALL RESIGN OR OTHERWISE CEASE TO
ACT AS BORROWER'S AGENT, BORROWER HEREBY IRREVOCABLY AGREES TO (A) IMMEDIATELY
DESIGNATE AND APPOINT A NEW AGENT ACCEPTABLE TO ADMINISTRATIVE AGENT TO SERVE IN
SUCH CAPACITY AND, IN SUCH EVENT, SUCH NEW AGENT SHALL BE DEEMED TO BE
SUBSTITUTED FOR CORPORATION SERVICE COMPANY FOR ALL PURPOSES HEREOF AND
(B) PROMPTLY DELIVER TO AGENT THE WRITTEN CONSENT (IN FORM AND SUBSTANCE
SATISFACTORY TO ADMINISTRATIVE AGENT) OF SUCH NEW AGENT AGREEING TO SERVE IN
SUCH CAPACITY.

        Section 10.9.    Limitation on Interest.    Lender Parties, Restricted
Persons and any other parties to the Loan Documents intend to contract in strict
compliance with applicable usury Law from time to time in effect. In furtherance
thereof such Persons stipulate and agree that none of the terms and provisions
contained in the Loan Documents shall ever be construed to create a contract to
pay, for the use, forbearance or detention of money, interest in excess of the
maximum amount of interest permitted to be contracted for, charged, or received
by applicable Law from time to time in effect. Neither any Restricted Person nor
any present or future guarantors, endorsers, or other Persons hereafter becoming
liable for payment of any Obligation shall ever be liable for unearned interest
thereon or shall ever be required to pay interest thereon in excess of the
maximum amount that may be lawfully contracted for, charged, or received under
applicable Law from time to time in effect, and the provisions of this
Section 10.9 shall control over all other provisions of the Loan Documents which
may be in conflict or apparent conflict herewith. Lender Parties expressly
disavow any intention to contract for, charge, or receive excessive unearned
interest or finance charges in the event the maturity of any Obligation is
accelerated. If (a) the maturity of any Obligation is accelerated for any
reason, (b) any Obligation is prepaid and as a result any amounts held to
constitute interest are determined to be in excess of the legal maximum, or
(c) any Lender or any other holder of any or all of the Obligations shall
otherwise collect moneys which are determined to constitute interest which would
otherwise increase the interest on any or all of the Obligations to an amount in
excess of that permitted to be contracted for, charged or received by applicable
Law then in effect, then all sums determined to constitute interest in excess of
such legal limit shall, without penalty, and to the extent permitted by
applicable Law be promptly applied to reduce the then outstanding principal of
the related Obligations or, at such Lender's or holder's option, promptly
returned to Borrower or other payor thereof upon such determination. In
determining whether or not the interest paid or payable, under any specific
circumstance, exceeds the maximum amount permitted under applicable Law, Lender
Parties and Restricted Persons (and any other payors thereof) shall to the
greatest extent permitted under applicable Law, (i) characterize any
non-principal payment as an expense, fee or premium rather than as interest,
(ii) exclude voluntary prepayments and the effects thereof, and (iii) amortize,
prorate, allocate, and spread the total amount of interest throughout the entire
contemplated term of the instruments evidencing the Obligations in accordance
with the amounts outstanding from time to time thereunder and the maximum legal
rate of interest from time to time in effect under applicable Law in order to
lawfully charge the maximum amount of interest permitted under applicable Law.

        Section 10.10.    Termination; Limited Survival.    In its sole and
absolute discretion Borrower may at any time that no Obligations are owing or
outstanding elect in a written notice delivered to Administrative Agent to
terminate this Agreement. Upon receipt by Administrative Agent of such a notice,
if no Obligations are then owing or outstanding this Agreement and all other
Loan Documents shall thereupon be terminated and the parties thereto released
from all prospective obligations thereunder. Notwithstanding the foregoing or
anything herein to the contrary, any waivers or admissions made by any
Restricted Person in any Loan Document, any Obligations under Sections 3.2

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through 3.7, any obligations which any Person may have to indemnify or
compensate any Lender Party, and the obligations of each Lender Party under
Section 10.6 shall survive any termination of this Agreement or any other Loan
Document. At the request and expense of Borrower, Administrative Agent shall
prepare and execute all necessary instruments to reflect and effect such
termination of the Loan Documents. Administrative Agent is hereby authorized to
execute all such instruments on behalf of all Lenders, without the joinder of or
further action by any Lender.

        Section 10.11.    Foreign Lenders.    Each Lender that is a "foreign
corporation, partnership or trust" within the meaning of the Code (a "Foreign
Lender") shall deliver to the Administrative Agent, prior to receipt of any
payment subject to withholding under the Code (or after accepting an assignment
of an interest herein), two duly signed completed copies of either IRS
Form W-8BEN or any successor thereto (relating to such Person and entitling it
to an exemption from withholding tax on all payments to be made to such Person
by Borrower pursuant to this Agreement) or IRS Form W-8ECI or any successor
thereto (relating to all payments to be made to such Person by Borrower pursuant
to this Agreement) or such other evidence satisfactory to Borrower and the
Administrative Agent that such Person is entitled to an exemption from U.S.
withholding tax. Thereafter and from time to time, each such Person shall
(a) promptly submit to the Administrative Agent such additional duly completed
and signed copies of one of such forms (or such successor forms as shall be
adopted from time to time by the relevant United States taxing authorities) as
may then be available under then current United States laws and regulations to
avoid, or such evidence as is satisfactory to Borrower and the Administrative
Agent of any available exemption from United States withholding taxes in respect
of all payments to be made to such Person by Borrower pursuant to this
Agreement, (b) promptly notify the Administrative Agent of any change in
circumstances which would modify or render invalid any claimed exemption, and
(c) take such steps as shall not be materially disadvantageous to it, in the
reasonable judgment of such Lender, and as may be reasonably necessary
(including the re-designation of its Lending Office) to avoid any requirement of
applicable Laws that Borrower make any deduction or withholding for taxes from
amounts payable to such Person. If such Person fails to deliver the above forms
or other documentation, then the Borrower may withhold from any interest payment
to such Person an amount equivalent to the applicable withholding tax imposed by
Sections 1441 and 1442 of the Code, without reduction. If any Tribunal asserts
that the Administrative Agent did not properly withhold any tax or other amount
from payments made in respect of such Person, such Person shall indemnify the
Administrative Agent therefor, including all penalties and interest, any taxes
imposed by any jurisdiction on the amounts payable to the Administrative Agent
under this Section 10.11, and costs and expenses (including Attorney Costs) of
the Administrative Agent. The obligation of the Lenders under this Section 10.11
shall survive the payment of all Obligations and the resignation or replacement
of the Administrative Agent.

        Section 10.12.    No General Partner's Liability.    The Lenders agree
for themselves and their respective successors and assigns, including any
subsequent holder of any Note, no claim arising against Borrower or any
Restricted Person under any Loan Document shall be asserted against the General
Partner and no judgment, order or execution entered in any suit, action or
proceeding, whether legal or equitable, on this Agreement, such Note or any of
the other Loan Documents shall be obtained or enforced against the General
Partner or its assets for the purpose of obtaining satisfaction and payment of
such Note, the Indebtedness evidenced thereby or any claims arising thereunder
or under this Agreement or any other Loan Document, any right to proceed against
the General Partner individually or its respective assets being hereby expressly
waived, renounced and remitted by the Lenders for themselves and their
respective successors and assigns. Nothing in this Section 10.12, however, shall
be construed so as to prevent the Administrative Agent, any Lender or any other
holder of any Note from commencing any action, suit or proceeding with respect
to or causing legal papers to be served upon the General Partner for the purpose
of (i) obtaining jurisdiction over Pacific Energy Partners or any Related Person
or (ii) obtaining judgment, order or execution against General Partner arising
out of

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any fraud or intentional misrepresentation by General Partner in connection with
the Loan Documents or of recovery of moneys received by General Partner in
violation of the terms of this Agreement.

        Section 10.13.    Severability.    If any term or provision of any Loan
Document shall be determined to be illegal or unenforceable all other terms and
provisions of the Loan Documents shall nevertheless remain effective and shall
be enforced to the fullest extent permitted by applicable Law.

        Section 10.14.    Counterparts.    This Agreement may be separately
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to
constitute one and the same Agreement.

        Section 10.15.    Waiver of Jury Trial, Punitive Damages,
etc.    RESTRICTED PERSONS AND LENDER PARTIES MUTUALLY HEREBY KNOWINGLY,
VOLUNTARILY, AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY IN RESPECT OF
ANY CLAIM BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH, THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENTS CONTEMPLATED TO BE EXECUTED IN CONNECTION
HEREWITH OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER
VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY. THIS WAIVER CONSTITUTES A MATERIAL
INDUCEMENT FOR LENDERS TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
AND MAKE THE LOANS. BORROWER AND EACH LENDER PARTY HEREBY FURTHER
(A) IRREVOCABLY WAIVES, TO THE MAXIMUM EXTENT NOT PROHIBITED BY LAW, ANY RIGHT
IT MAY HAVE TO CLAIM OR RECOVER IN ANY SUCH LITIGATION ANY "SPECIAL DAMAGES," AS
DEFINED BELOW, (B) CERTIFIES THAT NO PARTY HERETO NOR ANY REPRESENTATIVE OR
AGENT OR COUNSEL FOR ANY PARTY HERETO HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
OR IMPLIED THAT SUCH PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO
ENFORCE THE FOREGOING WAIVERS, AND (C) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO
ENTER INTO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS AND THE TRANSACTIONS
CONTEMPLATED HEREBY AND THEREBY BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS CONTAINED IN THIS SECTION. AS USED IN THIS SECTION, "SPECIAL
DAMAGES" INCLUDES ALL SPECIAL, CONSEQUENTIAL, EXEMPLARY, OR PUNITIVE DAMAGES
(REGARDLESS OF HOW NAMED), BUT DOES NOT INCLUDE ANY PAYMENTS OR FUNDS WHICH ANY
PARTY HERETO HAS EXPRESSLY PROMISED TO PAY OR DELIVER TO ANY OTHER PARTY HERETO.

        Section 10.16.    Waiver/Acknowledgments    

        (a)    Waivers.    No failure or delay (whether by course of conduct or
otherwise) by any Lender in exercising any right, power or remedy which such
Lender Party may have under any of the Loan Documents shall operate as a waiver
thereof or of any other right, power or remedy, nor shall any single or partial
exercise by any Lender Party of any such right, power or remedy preclude any
other or further exercise thereof or of any other right, power or remedy. No
waiver of any provision of any Loan Document and no consent to any departure
therefrom shall ever be effective unless it is in writing and signed as provided
below in this section, and then such waiver or consent shall be effective only
in the specific instances and for the purposes for which given and to the extent
specified in such writing. No notice to or demand on any Restricted Person shall
in any case of itself entitle any Restricted Person to any other or further
notice or demand in similar or other circumstances. This Agreement and the other
Loan Documents set forth the entire understanding between the parties hereto
with respect to the transactions contemplated herein and therein and supersede
all prior discussions and understandings with respect to the subject matter
hereof and thereof.

        (b)    Acknowledgments and Admissions.    Borrower hereby represents,
warrants, acknowledges and admits that (i) it has been advised by counsel in the
negotiation, execution and delivery of the Loan Documents to which it is a
party, (ii) it has made an independent decision to enter into this Agreement and
the other Loan Documents to which it is a party, without reliance on any
representation, warranty, covenant or undertaking by Administrative Agent or any
other Lender Party, whether written, oral or implicit, other than as expressly
set out in this Agreement or in another Loan Document delivered on or after the
date hereof, (iii) there are no representations, warranties, covenants,
undertakings or agreements by any Lender Party as to the Loan Documents except
as expressly set out in this

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Agreement or in another Loan Document delivered on or after the date hereof,
(iv) no Lender Party has any fiduciary obligation toward Borrower with respect
to any Loan Document or the transactions contemplated thereby, (v) the
relationship pursuant to the Loan Documents between Borrower and the other
Restricted Persons, on one hand, and each Lender Party, on the other hand, is
and shall be solely that of debtor and creditor, respectively, (vi) no
partnership or joint venture exists with respect to the Loan Documents between
any Restricted Person and any Lender Party, (vii) Administrative Agent is not
Borrower's Administrative Agent, but Administrative Agent for Lenders,
(viii) should an Event of Default or Default occur or exist, each Lender Party
will determine in its sole discretion and for its own reasons what remedies and
actions it will or will not exercise or take at that time, (ix) without limiting
any of the foregoing, Borrower is not relying upon any representation or
covenant by any Lender Party, or any representative thereof, and no such
representation or covenant has been made, that any Lender Party will, at the
time of an Event of Default or Default, or at any other time, waive, negotiate,
discuss, or take or refrain from taking any action permitted under the Loan
Documents with respect to any such Event of Default or Default or any other
provision of the Loan Documents, and (x) all Lender Parties have relied upon the
truthfulness of the acknowledgments in this section in deciding to execute and
deliver this Agreement and to become obligated hereunder.

        (c)    Representation by Lenders.    Each Lender hereby represents that
it will acquire its Note for its own account in the ordinary course of its
commercial lending business; however, the disposition of such Lender's property
shall at all times be and remain within its control and, in particular and
without limitation, such Lender may sell or otherwise transfer its Note, any
participation interest or other interest in its Note, or any of its other rights
and obligations under the Loan Documents subject to compliance with Sections
10.5(b) through (f), inclusive, and applicable Law.

        (d)    Joint Acknowledgment.    THIS WRITTEN AGREEMENT AND THE OTHER
LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES.

        There are no unwritten oral agreements between the parties.

        Section 10.17.    Restatement.    Effective as of the Closing Date, the
Existing US Bank Agreement, all Loan Documents and Security Documents (as such
terms are defined therein), and all Liens and security interests created
thereunder will be assigned to Administrative Agent, on behalf of the Term
Lenders. Accordingly, this Agreement amends and restates the Existing US Bank
Agreement in its entirety, effective as of the Closing Date. The loans and all
other obligations outstanding under the Existing US Bank Agreement shall be
deemed to be outstanding Term Loans under and governed by this Agreement,
effective as of the Closing Date.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]

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        IN WITNESS WHEREOF, this Agreement is executed as of the date first
written above.

BORROWER:   PACIFIC ENERGY GROUP LLC
 
 
 
 
By:
 
/s/  LYNN T. WOOD                  

--------------------------------------------------------------------------------

Lynn T. Wood
Vice President
PACIFIC ENERGY PARTNERS:
 
PACIFIC ENERGY PARTNERS, L.P.     By:   PACIFIC ENERGY GP, INC.,
its general partner
 
 
 
 
By:
 
/s/  LYNN T. WOOD                  

--------------------------------------------------------------------------------

Lynn T. Wood
Vice President

      Address for Borrower and Pacific Energy Partners:
 
 
 
5900 Cherry Street
Long Beach, California 90805       Attention: Irvin Toole, Jr.       Telephone:
(562) 728-2800       Fax: (562) 728-2823

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FLEET NATIONAL BANK,
Administrative Agent, LC Issuer and
a Lender
 
By:
/s/  TERRENCE RONAN      

--------------------------------------------------------------------------------

Terrence Ronan
Managing Director

 
Address:
 
100 Federal Street
Boston, Massachusetts 02110   Attention: Terrence Ronan   Mail Code: MADE 10008D
  Telephone: (617) 434-5472   Fax: (617) 434-3652

 
FLEET SECURITIES, INC.,
Co-Lead Arranger and Co-Book Manager
 
By:
/s/  RICHARD MAKIN      

--------------------------------------------------------------------------------

Richard Makin
Managing Director

75

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U.S. BANK NATIONAL ASSOCIATION
Syndication Agent, Co-Lead Arranger and
Co-Book Manager and a Lender
 
By:
/s/  MATTHEW J. PURCHASE      

--------------------------------------------------------------------------------

Matthew J. Purchase
Assistant Vice President

76

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THE BANK OF NOVA SCOTIA
Co-Documentation Agent and a Lender

 

By:

/s/  N. BELL      

--------------------------------------------------------------------------------

N. Bell
Senior Manager

77

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FORTIS CAPITAL CORP.
Co-Documentation Agent and a Lender
 
By:
/s/  DEIRDRE SANBORN      

--------------------------------------------------------------------------------

Deirdre Sanborn
Vice President
 
By:
/s/  JOHN C. PRENETA      

--------------------------------------------------------------------------------

John C. Preneta
Executive Vice President

78

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BNP PARIBAS
Lender
 
By:
/s/  J. ONISCHUK      

--------------------------------------------------------------------------------

J. Onischuk
Director

 

By:

/s/  GREG SMOTHERS      

--------------------------------------------------------------------------------

Greg Smothers
Vice President

79

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CITICORP USA, INC.
Lender
 
By:
/s/  J. CHRISTOPHER LYONS      

--------------------------------------------------------------------------------

J. Christopher Lyons
Vice President

80

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LENDER SCHEDULE

Lender:   FLEET NATIONAL BANK
Lender's Revolver Commitment:
 
$37,000,000
Lender's Revolver Percentage Share:
 
18.50%
Lender's Term Commitment:
 
$225,000,000
Domestic Lending Office:
 
 
100 Federal Street
Boston, Massachusetts 02110
 
 
LIBOR Lending Office:
 
 
100 Federal Street
Boston, Massachusetts 02110
 
 
Notices:
 
 
100 Federal Street
Global Energy, MADE 10008A
Boston, Massachusetts 02110
 
 

Attention:
 
Terrence Ronan Telephone:   (617) 434-5472
Attention:
 
Michael Brochetti Telephone:   (617) 434-3017
Fax:
 
(617) 434-3652

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LENDER SCHEDULE

Lender:   U.S. BANK NATIONAL ASSOCIATION
Lender's Revolver Commitment:
 
$36,000,000
Lender's Revolver Percentage Share:
 
18.0%
Lender's Term Commitment:
 
$0.00

Domestic Lending Office:
555 SW Oak, PD-OR-P7LN
Portland, OR 97208 Attention:   Suzanne Patton Telephone:   (503) 275-4122 Fax:
  (503) 275-8181
LIBOR Lending Office:
555 SW Oak, PD-OR-P7LN
Portland, OR 97208 Attention:   Suzanne Patton Telephone:   (503) 275-4122 Fax:
  (503) 275-8181
Notices:
918 17th Street, DNCOBB3E
Denver, Colorado 80202 Attention:   Monte E. Deckerd Telephone:   (303) 585-4212
Fax:   (303) 585-4362

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LENDER SCHEDULE

Lender:   THE BANK OF NOVA SCOTIA
Lender's Revolver Commitment:
 
$36,000,000
Lender's Revolver Percentage Share:
 
18.0%
Lender's Term Commitment:
 
$0.00

Domestic Lending Office:
600 Peachtree Street, N.E., Suite 2700
Atlanta, Georgia 30308
LIBOR Lending Office:
600 Peachtree Street, N.E., Suite 2700
Atlanta, Georgia 30308
Notices:
600 Peachtree Street, N.E., Ste 2700
Atlanta, Georgia 30308 Attention:   Donna Gardner Telephone:   (404) 877-1559
Fax:   (404) 888-8998
With Copy to:
Houston Representative Office
1100 Louisiana, Ste 3000
Houston, Texas 77002 Attention:   Bryan Bulawa/Tracy Butz Telephone:   (713)
759-3427; -3448 Fax:   (713) 752-2425

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LENDER SCHEDULE

Lender:   FORTIS CAPITAL CORP.
Lender's Revolver Commitment:
 
$36,000,000
Lender's Revolver Percentage Share:
 
18.0%
Lender's Term Commitment:
 
$0.00

Domestic Lending Office:
100 Crescent Court, Suite 1777
Dallas, Texas 75201
LIBOR Lending Office:
100 Crescent Court, Suite 1777
Dallas, Texas 75201
Notices:
100 Crescent Court, Suite 1777
Dallas, Texas 75201 Attention:   Darrell W. Holley/Deirdre Sanborn Telephone:  
(214) 754-0009 Fax:   (214) 754-5951

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LENDER SCHEDULE

Lender:   BNP PARIBAS
Lender's Revolver Commitment:
 
$30,000,000
Lender's Revolver Percentage Share:
 
15.0%
Lender's Term Commitment:
 
$0.00

Domestic Lending Office:
1200 Smith Street, Suite 3100
Houston, Texas 77002
LIBOR Lending Office:
1200 Smith Street, Suite 3100
Houston, Texas 77002
Notices:
1200 Smith Street, Suite 3100
Houston, Texas 77002 Attention:   Joe Onischuk/Greg Smothers Telephone:   (713)
982-1161; 1151 Fax:   (713) 659-6915

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LENDER SCHEDULE

Lender:   CITICORP USA, INC.
Lender's Revolver Commitment:
 
$25,000,000
Lender's Revolver Percentage Share:
 
12.50%
Lender's Term Commitment:
 
$0.00

Domestic Lending Office:
399 Park Avenue
New York, New York 10043
LIBOR Lending Office:
399 Park Avenue
New York, New York 10043
Borrowing Notices:
Two Penn's Way, 2nd Floor
New Castle, Delaware 19720 Attention:   Diane Stewart
Other Notices:
1200 Smith Street, Suite 2000
Houston, Texas 77002 Attention:   Amy Pincu Telephone:   (713) 654-2820 Fax:  
(713) 654-2849

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SCHEDULE 2

DISCLOSURE SCHEDULE

87

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SCHEDULE 3

SECURITY SCHEDULE

        1.    Guaranty by Pacific Energy Partners in favor of Administrative
Agent.

        2.    Guaranty by each of Anschutz Ranch East Pipeline LLC, Pacific
Marketing and Transportation LLC, Ranch Pipeline LLC and Rocky Mountain Pipeline
System LLC in favor of Administrative Agent.

        3.    Pledge Agreement by Borrower in favor of Administrative Agent
pledging all member interests in each of its Restricted Subsidiaries (the
"Borrower Pledge Agreement").

        4.    UCC-1 Financing Statement filed in connection with the Borrower
Pledge Agreement with the Secretary of State of Delaware.

        5.    Pledge Agreement by Pacific Energy Partners in favor of
Administrative Agent pledging all member interests in Borrower (the "Pacific
Energy Partners Pledge Agreement").

        6.    UCC-1 Financing Statement filed in connection with the Pacific
Energy Partners Pledge Agreement with the Secretary of State of Delaware.

        7.    Note Pledge Agreement by Borrower in favor of Administrative Agent
pledging the Pledged Note described therein (the "Note Pledge Agreement").

        8.    Deed of Trust, Mortgage, Assignment, Security Agreement, Fixture
Filing and Financing Statement dated as of March 1, 2002 executed by Rocky
Mountain Pipeline System LLC in favor of U.S. Bank National Association, as
assigned to Administrative Agent for the benefit of Lenders, as amended.

        9.    Mortgage, Assignment, Security Agreement, Fixture Filing and
Financing Statement (Colorado) dated as of March 1, 2002 executed by Rocky
Mountain Pipeline System LLC in favor of U.S. Bank National Association, as
assigned to Administrative Agent for the benefit of Lenders, as amended.

        10.  Mortgage, Assignment, Security Agreement, Fixture Filing and
Financing Statement (Wyoming) dated as of March 1, 2002 executed by Rocky
Mountain Pipeline System LLC in favor of U.S. Bank National Association, as
assigned to Administrative Agent for the benefit of Lenders, as amended.

        11.  Mortgage, Assignment, Security Agreement, Fixture Filing and
Financing Statement (Montana) dated as of March 1, 2002 executed by Rocky
Mountain Pipeline System LLC in favor of U.S. Bank National Association, as
assigned to Administrative Agent for the benefit of Lenders, as amended.

        12.  UCC-1 Financing Statements filed in connection with the Security
Documents listed as items 8 through 11 above.

88

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EXHIBIT A-1

PROMISSORY NOTE
[Revolver Note]

$                            New York, New York                            , 200
  

        FOR VALUE RECEIVED, the undersigned, Pacific Energy Group LLC, a
Delaware limited liability company (herein called "Borrower"), hereby promises
to pay to the order of                        
                                                 ,
a                        (herein called "Lender"), the principal sum
of                                                 Dollars
($                        ), or, if greater or less, the aggregate unpaid
principal amount of the Revolver Loans made under this Note by Lender to
Borrower pursuant to the terms of the Credit Agreement (as hereinafter defined),
together with interest on the unpaid principal balance thereof as hereinafter
set forth, both principal and interest payable as herein provided in lawful
money of the United States of America at the offices of Administrative Agent
under the Credit Agreement, 100 Federal Street, Boston, Massachusetts, or at
such other place as from time to time may be designated by the holder of this
Note.

        This Note (a) is issued and delivered under that certain Credit
Agreement dated July 19, 2002, among Borrower, Pacific Energy Partners, L.P.,
Fleet National Bank, as Administrative Agent, the other agents and the arrangers
referred to therein, and the lenders (including Lender) referred to therein
(herein, as from time to time supplemented, amended or restated, called the
"Credit Agreement"), and is a "Revolver Note" as defined therein, (b) is subject
to the terms and provisions of the Credit Agreement, which contains provisions
for payments and prepayments hereunder and acceleration of the maturity hereof
upon the happening of certain stated events, and (c) is secured by and entitled
to the benefits of certain Security Documents (as identified and defined in the
Credit Agreement). Payments on this Note shall be made and applied as provided
herein and in the Credit Agreement. Reference is hereby made to the Credit
Agreement for a description of certain rights, limitations of rights,
obligations and duties of the parties hereto and for the meanings assigned to
terms used and not defined herein and to the Security Documents for a
description of the nature and extent of the security thereby provided and the
rights of the parties thereto.

        For the purposes of this Note, the following terms have the meanings
assigned to them below:

        "Base Rate Payment Date" means (i) the last day of each March, June,
September and December, beginning September 30, 2002, and (ii) any day on which
past due interest or principal is owed hereunder and is unpaid. If the terms
hereof or of the Credit Agreement provide that payments of interest or principal
hereon shall be deferred from one Base Rate Payment Date to another day, such
other day shall also be a Base Rate Payment Date.

        "LIBOR Rate Payment Date" means, with respect to any LIBOR Loan: (i) for
LIBOR Loans having an Interest Period of one (1), two (2), or three (3) months,
the day on which the related Interest Period ends, (ii) for LIBOR Loans having
an Interest Period of six (6) months, the day on which the Interest Period ends
and on the last day of each Fiscal Quarter, and (iii) any day on which past due
interest or past due principal is owed hereunder with respect to such LIBOR Loan
and is unpaid. If the terms hereof or of the Credit Agreement provide that
payments of interest or principal with respect to such LIBOR Loan shall be
deferred from one LIBOR Rate Payment Date to another day, such other day shall
also be a LIBOR Rate Payment Date.

        The principal amount of this Note, together with all interest accrued
hereon, shall be due and payable in full on the Revolver Maturity Date.

89

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        Unless the Default Rate shall apply, (i) each Base Rate Loan shall bear
interest on each day outstanding at the Base Rate plus the applicable Base Rate
Margin in effect on such day and (ii) each LIBOR Loan shall bear interest on
each day during the related Interest Period at the related LIBOR Rate plus the
applicable LIBOR Rate Margin in effect on such day. During a Default Rate
Period, all Loans shall bear interest on each day outstanding at the Default
Rate. If an Event of Default under Section 8.1(a) or Section 8.1(b), or with
respect to Borrower, Section 8.1(h)(i), (h)(ii) or (h)(iii), of the Credit
Agreement exists and the Loans are not bearing interest at the Default Rate, the
past due principal and past due interest shall bear interest on each day
outstanding at the Default Rate. The interest rate shall change whenever the
applicable Base Rate, the applicable Base Rate Margin, the applicable LIBOR Rate
or the applicable LIBOR Rate Margin changes. In no event shall the interest rate
on any Loan exceed the Highest Lawful Rate.

        Notwithstanding the foregoing paragraph and all other provisions of this
Note, in no event shall the interest payable hereon, whether before or after
maturity, exceed the maximum interest which, under applicable Law, may be
charged on this Note, and this Note is expressly made subject to the provisions
of the Credit Agreement which more fully set out the limitations on how interest
accrues hereon.

        On each Base Rate Payment Date, Borrower shall pay to the holder hereof
all unpaid interest which has accrued on the Base Rate Loans to but not
including such Base Rate Payment Date. On each LIBOR Rate Payment Date relating
to such LIBOR Loan, Borrower shall pay to the holder hereof all unpaid interest
which has accrued on such LIBOR Loan to but not including such LIBOR Rate
Payment Date. All interest on past due principal of and past due interest on the
Loan shall be due and payable daily as it accrues.

        If this Note is placed in the hands of an attorney for collection after
default, or if all or any part of the indebtedness represented hereby is proved,
established or collected in any court or in any bankruptcy, receivership, debtor
relief, probate or other court proceedings, Borrower and all endorsers, sureties
and guarantors of this Note jointly and severally agree to pay reasonable
attorneys' fees and collection costs to the holder hereof in addition to the
principal and interest payable hereunder.

        Borrower and all endorsers, sureties and guarantors of this Note hereby
severally waive demand, presentment, notice of demand and of dishonor and
nonpayment of this Note, protest, notice of protest, notice of intention to
accelerate the maturity of this Note, declaration or notice of acceleration of
the maturity of this Note, diligence in collecting, the bringing of any suit
against any party and any notice of or defense on account of any extensions,
renewals, partial payments or changes in any manner of or in this Note or in any
of its terms, provisions and covenants, or any releases or substitutions of any
security, or any delay, indulgence or other act of any trustee or any holder
hereof, whether before or after maturity.

        THIS NOTE AND THE RIGHTS AND DUTIES OF THE PARTIES HERETO SHALL BE
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW), EXCEPT TO THE EXTENT THE SAME ARE GOVERNED BY APPLICABLE
FEDERAL LAW.

 
 
PACIFIC ENERGY GROUP LLC
 
 
By:
 
         

--------------------------------------------------------------------------------

          Name:           Title:

90

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EXHIBIT A-2

PROMISSORY NOTE
[Term Note]

$                            New York, New York                            , 200
  

        FOR VALUE RECEIVED, the undersigned, Pacific Energy Group LLC, a
Delaware limited liability company (herein called "Borrower"), hereby promise to
pay to the order of                        
                                                 ,
a                        (herein called "Lender"), the principal sum
of                                                 ($                        ),
or, if greater or less, the aggregate unpaid principal amount of the Term Loan
made under this Note by Lender to Borrower pursuant to the terms of the Credit
Agreement (as hereinafter defined), together with interest on the unpaid
principal balance thereof as hereinafter set forth, both principal and interest
payable as herein provided in lawful money of the United States of America at
the offices of Administrative Agent under the Credit Agreement, 100 Federal
Street, Boston, Massachusetts, or at such other place as from time to time may
be designated by the holder of this Note.

        This Note (a) is issued and delivered under that certain Credit
Agreement dated July 19, 2002 among Borrower, Pacific Energy Partners, L.P.,
Fleet National Bank, as Administrative Agent, the other agents and arrangers
referred to therein, and the lenders (including Lender) referred to therein
(herein, as from time to time supplemented, amended or restated, called the
"Credit Agreement"), and is a "Term Note" as defined therein, (b) is subject to
the terms and provisions of the Credit Agreement, which contains provisions for
payments and prepayments hereunder and acceleration of the maturity hereof upon
the happening of certain stated events, (c) is secured by and entitled to the
benefits of certain Security Documents (as identified and defined in the Credit
Agreement), and (d) is given in partial renewal and extension (but not in
extinguishment or novation) of certain indebtedness as described in the Credit
Agreement. Payments on this Note shall be made and applied as provided herein
and in the Credit Agreement. Reference is hereby made to the Credit Agreement
for a description of certain rights, limitations of rights, obligations and
duties of the parties hereto and for the meanings assigned to terms used and not
defined herein and to the Security Documents for a description of the nature and
extent of the security thereby provided and the rights of the parties thereto.

        For the purposes of this Note, the following terms have the meanings
assigned to them below:

        "Base Rate Payment Date" means (i) the last day of each March, June,
September and December, beginning September 30, 2002; (ii) the date the full
remaining principal balance of this Note shall become due and payable; and
(iii) any day on which past due interest or principal is owed hereunder and is
unpaid. If the terms hereof or of the Credit Agreement provide that payments of
interest or principal hereon shall be deferred from one Base Rate Payment Date
to another day, such other day shall also be a Base Rate Payment Date.

        "LIBOR Rate Payment Date" means, with respect to any LIBOR Loan: (i) for
LIBOR Loans having an Interest Period of one (1), two (2), or three (3) months,
the day on which the related Interest Period ends, (ii) for LIBOR Loans having
an Interest Period of six (6) months, the day on which the Interest Period ends
and on the last day of each Fiscal Quarter, and (iii) any day on which past due
interest or past due principal is owed hereunder with respect to such LIBOR Loan
and is unpaid. If the terms hereof or of the Credit Agreement provide that
payments of interest or principal with respect to such LIBOR Loan shall be
deferred from one LIBOR Rate Payment Date to another day, such other day shall
also be a LIBOR Rate Payment Date.

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        The principal amount of this Note, together with all interest accrued
hereon, shall be due and payable in full on the Term Loan Maturity Date.

        Unless the Default Rate shall apply, (i) each Base Rate Loan shall bear
interest on each day outstanding at the Base Rate plus the applicable Base Rate
Margin in effect on such day and (ii) each LIBOR Loan shall bear interest on
each day during the related Interest Period at the related LIBOR Rate plus the
applicable LIBOR Rate Margin in effect on such day. During a Default Rate
Period, all Loans shall bear interest on each day outstanding at the Default
Rate. If an Event of Default under Section 8.1(a) or Section 8.1(b), or with
respect to Borrower, Section 8.1(h)(i), (h)(ii) or (h)(iii), of the Credit
Agreement exists and the Loans are not bearing interest at the Default Rate, the
past due principal and past due interest shall bear interest on each day
outstanding at the Default Rate. The interest rate shall change whenever the
applicable Base Rate, the applicable Base Rate Margin, the applicable LIBOR Rate
or the applicable LIBOR Rate Margin changes. In no event shall the interest rate
on any Loan exceed the Highest Lawful Rate.

        Notwithstanding the foregoing paragraph and all other provisions of this
Note, in no event shall the interest payable hereon, whether before or after
maturity, exceed the maximum interest which, under applicable Law, may be
charged on this Note, and this Note is expressly made subject to the provisions
of the Credit Agreement which more fully set out the limitations on how interest
accrues hereon.

        On each Base Rate Payment Date, Borrower shall pay to the holder hereof
all unpaid interest which has accrued on the Base Rate Loans to but not
including such Base Rate Payment Date. On each LIBOR Rate Payment Date relating
to such LIBOR Loan, Borrower shall pay to the holder hereof all unpaid interest
which has accrued on such LIBOR Loan to but not including such LIBOR Rate
Payment Date. All interest on past due principal of and past due interest on the
Loan shall be due and payable daily as it accrues.

        If this Note is placed in the hands of an attorney for collection after
default, or if all or any part of the indebtedness represented hereby is proved,
established or collected in any court or in any bankruptcy, receivership, debtor
relief, probate or other court proceedings, Borrower and all endorsers, sureties
and guarantors of this Note jointly and severally agree to pay reasonable
attorneys' fees and collection costs to the holder hereof in addition to the
principal and interest payable hereunder.

        Borrower and all endorsers, sureties and guarantors of this Note hereby
severally waive demand, presentment, notice of demand and of dishonor and
nonpayment of this Note, protest, notice of protest, notice of intention to
accelerate the maturity of this Note, declaration or notice of acceleration of
the maturity of this Note, diligence in collecting, the bringing of any suit
against any party and any notice of or defense on account of any extensions,
renewals, partial payments or changes in any manner of or in this Note or in any
of its terms, provisions and covenants, or any releases or substitutions of any
security, or any delay, indulgence or other act of any trustee or any holder
hereof, whether before or after maturity.

        THIS NOTE AND THE RIGHTS AND DUTIES OF THE PARTIES HERETO SHALL BE
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW), EXCEPT TO THE EXTENT THE SAME ARE GOVERNED BY APPLICABLE
FEDERAL LAW.

 
 
PACIFIC ENERGY GROUP LLC
 
 
By:
 
         

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          Name:           Title:

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EXHIBIT B

BORROWING NOTICE

        Reference is made to that certain Credit Agreement dated as of July 19,
2002 (as from time to time, supplemented, amended or restated, the "Agreement"),
by and among Pacific Energy Group LLC ("Borrower"), Pacific Energy Partners,
L.P. ("Pacific Energy Partners"), Fleet National Bank, as Administrative Agent,
the other agents and the arrangers referred to therein, and certain financial
institutions ("Lenders"). Terms which are defined in the Agreement are used
herein with the meanings given them in the Agreement. Pursuant to the terms of
the Agreement Borrower hereby requests Lenders to make [Revolver/Term] Loans to
Borrower in the aggregate principal amount of
$                                           and
specifies                        ,             , as the date Borrower desires
for Lenders to make such [Revolver/Term] Loans and for Administrative Agent to
deliver to Borrower the proceeds thereof.

Type of Loans: [LIBOR Loans][Base Rate Loans]
Length of Interest Periods for LIBOR Loan (1, 2, 3 or 6 months)
Specify amount of Distribution Loans, if any: $                        

        To induce Lenders to make such [Revolver/Term] Loans, Pacific Energy
Partners and Borrower hereby represent, warrant, acknowledge, and agree to and
with Administrative Agent and each Lender that:

        (a)  The officer of Borrower signing this instrument is the duly
elected, qualified and acting officer of Borrower as indicated below such
officer's signature hereto having all necessary authority to act for Borrower in
making the request herein contained.

        (b)  The officer of General Partner signing this instrument is the duly
elected, qualified and acting officer of General Partner as indicated below such
officer's signature hereto having all necessary authority to act for the General
Partner, on behalf of Pacific Energy Partners, in making the request herein
contained.

        (c)  The representations and warranties of Pacific Energy Partners and
Borrower set forth in the Agreement and the other Loan Documents are true and
correct on and as of the date hereof (except to the extent that the facts on
which such representations and warranties are based have been changed by the
extension of credit under the Agreement or to the extent that such
representation or warranty was made as of a specific date or updated, modified
or supplemented, as of a subsequent date with the consent of Majority Lenders),
with the same effect as though such representations and warranties had been made
on and as of the date hereof.

        (d)  There does not exist on the date hereof any condition or event
which constitutes a Default which has not been waived in writing as provided in
Section 10.1 of the Agreement; nor will any such Default exist upon Borrower's
receipt and application of the Loans requested hereby. No Material Adverse
Change has occurred to, and no event or circumstance has occurred that could
reasonably be expected to cause a Material Adverse Change to, Pacific Energy
Partners' or Borrower's Consolidated financial condition or businesses since the
date of the Initial Financial Statements. Borrower will use the [Revolver/Term]
Loans hereby requested in compliance with Section 2.4 of the Agreement.

        (e)  Each of the applicable conditions precedent to Loans contained in
the Agreement remains satisfied.

        (f)    [Neither the Revolver Facility Usage nor] the Facility Usage,
after the making of the [Revolver/Term] Loans requested hereby, will [not] be in
excess of the Maximum Facility Amount [or the Maximum Revolver Facility Amount,
respectively,] on the date requested for the making of such Loans.

93

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        (g)  The Loan Documents have not been modified, amended or supplemented
by any unwritten representations or promises, by any course of dealing, or by
any other means not provided for in Section 10.1 of the Agreement. The Agreement
and the other Loan Documents are hereby ratified, approved, and confirmed in all
respects.

        The officer of General Partner and Borrower signing this instrument
hereby certifies (as an officer of the General Partner or Borrower,
respectively, and not in his/her individual capacity), that to the best of his
knowledge after due inquiry, the above representations, warranties,
acknowledgments, and agreements of Pacific Energy Partners and Borrower,
respectively, are true, correct and complete in all material respects.

        IN WITNESS WHEREOF, this instrument is executed as
of                        ,             .

 
 
PACIFIC ENERGY PARTNERS, L.P.
 
 
By:
 
PACIFIC ENERGY GP, Inc., its general partner
 
 
By:
 
         

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        Name:
Title:
 
 
PACIFIC ENERGY GROUP LLC
 
 
By:
 
         

--------------------------------------------------------------------------------

        Name:
Title:

94

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EXHIBIT C

CONTINUATION/CONVERSION NOTICE

        Reference is made to that certain Credit Agreement dated as of July 19,
2002 (as from time to time amended, the "Agreement"), by and among Pacific
Energy Group LLC ("Borrower"), Pacific Energy Partners, L.P. ("Pacific Energy
Partners"), Fleet National Bank, N.A., as Administrative Agent, the other agents
and the arrangers referred to therein, and certain financial institutions
("Lenders"). Terms which are defined in the Agreement are used herein with the
meanings given them in the Agreement.

Borrower hereby requests a conversion or continuation of existing [Term]
[Revolver] Loans into a new Borrowing pursuant to Section 2.3 of the Agreement
as follows:

Existing Borrowing(s) of [Term] [Revolver] Loans to be Continued or Converted:

$                      of LIBOR Loans with Interest Period ending
                               $                      of Base Rate Loans       
              

    Aggregate amount of new [Term] [Revolver] Borrowing:   $              

--------------------------------------------------------------------------------

    Type of Loans in new Borrowing:                

--------------------------------------------------------------------------------

    Date of Continuation or Conversion:                

--------------------------------------------------------------------------------

    Length of Interest Period for LIBOR
Loans (1, 2, 3 or 6 months):       months        

--------------------------------------------------------------------------------

 

        Pacific Energy Partners and Borrower hereby represent, warrant,
acknowledge, and agree to and with each Lender that:

        (a)  The officer of Borrower signing this instrument is the duly
elected, qualified and acting officer of Borrower as indicated below such
officer's signature hereto having all necessary authority to act for Borrower in
making the request herein.

        (b)  The officer of General Partner signing this instrument is the duly
elected, qualified and acting officer of General Partner as indicated below such
officer's signature hereto having all necessary authority to act for General
Partner, on behalf of Pacific Energy Partners, in making the request herein
contained.

        (c)  There does not exist on the date hereof any condition or event
which constitutes a Default which has not been waived in writing as provided in
Section 10.1 of the Agreement; nor will any such Default exist upon Borrower's
receipt and application of the Loans requested hereby.

        (d)  The Loan Documents have not been modified, amended or supplemented
by any unwritten representations or promises, by any course of dealing, or by
any other means not provided for in Section 10.1 of the Agreement. The Agreement
and the other Loan Documents are hereby ratified, approved, and confirmed in all
respects.

        The officer of General Partner and Borrower signing this instrument
hereby certifies (as an officer of the General Partner or Borrower,
respectively, and not in his/her individual capacity), that to the best of his
knowledge after due inquiry, the above representations, warranties,
acknowledgments, and agreements of Pacific Energy Partners and Borrower,
respectively, are true, correct and complete in all material respects.

95

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        IN WITNESS WHEREOF, this instrument is executed as
of                        ,             .

 
 
PACIFIC ENERGY PARTNERS, L.P.
 
 
By:
 
PACIFIC ENERGY GP, Inc., its general partner
 
 
By:
 
 
         

--------------------------------------------------------------------------------

        Name:
Title:
 
 
PACIFIC ENERGY GROUP LLC
 
 
By:
 
 
B        

--------------------------------------------------------------------------------

          Name:
Title:

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EXHIBIT D

CERTIFICATE ACCOMPANYING
FINANCIAL STATEMENTS

        Reference is made to that certain Credit Agreement dated as of July 19,
2002 (as from time to time amended, the "Agreement"), by and among Pacific
Energy Group LLC ("Borrower"), Pacific Energy Partners, L.P. ("Pacific Energy
Partners"), Fleet National Bank, as Administrative Agent, the other agents and
the arrangers referred to therein, and certain financial institutions
("Lenders"), which Agreement is in full force and effect on the date hereof.
Terms which are defined in the Agreement are used herein with the meanings given
them in the Agreement.

        This Certificate is furnished pursuant to Section 6.2(b) of the
Agreement. Together herewith Pacific Energy Partners is furnishing to
Administrative Agent and each Lender Pacific Energy Partners'
*[audited/unaudited] financial statements (the "Financial Statements") as
at                        (the "Reporting Date"). Pacific Energy Partners and
Borrower hereby represent, warrant, and acknowledge to Administrative Agent and
each Lender that:

        (a)  the officer of Borrower signing this instrument is the duly
elected, qualified and acting                        of Borrower and as such is
Borrower's [chief financial officer/principal accounting officer];

        (b)  the officer of General Partner signing this instrument is the duly
elected, qualified and acting                        of General Partner and as
such is General Partner's [chief financial officer/principal accounting
officer];

        (c)  the Financial Statements fairly present, in accordance with GAAP,
the financial position and results of operations of Pacific Energy Partners and
Borrower as of the date thereof [(subject, in the case of such unaudited
financial statements to normal year-end adjustments)];

        (d)  attached hereto is a schedule of calculations showing Pacific
Energy Partners' and Borrower's compliance as of the Reporting Date with the
requirements of Sections 7.10 - 7.12 of the Agreement *[and Pacific Energy
Partners' and Borrower's non-compliance as of such date with the requirements of
Section(s)                         of the Agreement];

        (e)  to such officer's knowledge, no Default existed on the Reporting
Date or otherwise exists on the date of this instrument *[except for Default(s)
under Section(s)                        of the Agreement, which *[is/are] more
fully described on a schedule attached hereto].

        The officer of General Partner and Borrower signing this instrument
hereby certifies (as an officer of the General Partner or Borrower,
respectively, and not in his/her individual capacity) that he/she is familiar
with the terms of the Loan Documents and has reviewed the Financial Statements.

97

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        IN WITNESS WHEREOF, this instrument is executed as
of                        ,             .

 
 
PACIFIC ENERGY PARTNERS, L.P.
 
 
By:
 
PACIFIC ENERGY GP, Inc., its general partner
 
 
By:
 
         

--------------------------------------------------------------------------------

        Name:
Title:
 
 
PACIFIC ENERGY GROUP LLC
 
 
By:
 
         

--------------------------------------------------------------------------------

        Name:
Title:

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EXHIBIT E

ASSIGNMENT AND ACCEPTANCE
[Term Loans] [Revolver Loans](1)]

        Reference is made to the Credit Agreement dated as of July 19, 2002 (the
"Credit Agreement") among Pacific Energy Group LLC, a Delaware limited liability
company (the "Borrower"), Pacific Energy Partners, L.P. ("Pacific Energy
Partners"), the Lenders (as defined in the Credit Agreement) and Fleet National
Bank, as Administrative Agent for the Lenders (the "Administrative Agent").
Terms defined in the Credit Agreement are used herein with the same meaning.

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(1)A separate Assignment and Acceptance shall be required for Term Loans and for
Revolver Loans.

--------------------------------------------------------------------------------

        The "Assignor" and the "Assignee" referred to on Schedule 1 agree as
follows:

        1.    The Assignor hereby sells and assigns to the Assignee, without
recourse and without representation or warranty except as expressly set forth
herein, and the Assignee hereby purchases and assumes from the Assignor, an
interest in and to the Assignor's rights and obligations under the Credit
Agreement and the other Loan Documents as of the date hereof equal to the
percentage interest specified on Schedule 1 of all outstanding rights and
obligations under the Credit Agreement and the other Loan Documents. [After
giving effect to such sale and assignment, the Assignee's Revolver Commitment
and the amount of the Revolver Loans owing to the Assignee will be as set forth
on Schedule 1. After giving effect to such sale and assignment, the Assignee's
Term Commitment and the amount of the Term Loans owing to the Assignee will be
as set forth on Schedule 1.]

        2.    The Assignor (i) represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim; (ii) makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with the Loan Documents
or the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Loan Documents or any other instrument or document furnished
pursuant thereto; (iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of any Restricted Person
or the performance or observance by any Restricted Person of any of its
obligations under the Loan Documents or any other instrument or document
furnished pursuant thereto; and (iv) attaches the Note held by the Assignor and
requests that Administrative Agent exchange such Note for [a new Note payable to
the order of the Assignee.] [new Notes in an amount equal to the [Revolver/Term]
Commitment assumed by the Assignee pursuant hereto and to the Assignor in an
amount equal to the [Revolver/Term] Commitment retained by the Assignor, if any,
as specified on Schedule 1.]

        3.    The Assignee (i) confirms that it has received a copy of the
Credit Agreement, together with copies of the financial statements referred to
in Section [            ] thereof and such other documents and information as it
has deemed appropriate to make its own credit analysis and decision to enter
into this Assignment and Acceptance; (ii) agrees that it will, independently and
without reliance upon Administrative Agent, the Assignor or any other Lender and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Credit Agreement; (iii) confirms that it is an Eligible Transferee;
(iv) appoints and authorizes Administrative Agent to take such action as agent
on its behalf and to exercise such powers and discretion under the Credit
Agreement as are delegated to Administrative Agent by the terms thereof,
together with such powers and discretion as are reasonably incidental thereto;
(v) agrees that it will perform in accordance with their terms all of the
obligations that by the terms of the Credit Agreement are required to be
performed by it as a Lender; and (vi) attaches any U.S. Internal Revenue Service
or other forms required under Section [            ].

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        4.    Following the execution of this Assignment and Acceptance, it will
be delivered to Administrative Agent for acceptance and recording by
Administrative Agent. The effective date for this Assignment and Acceptance (the
"Effective Date") shall be the date of acceptance hereof by Administrative
Agent, unless otherwise specified on Schedule 1.

        5.    Upon such acceptance and recording by Administrative Agent, as of
the Effective Date, (i) the Assignee shall be a party to the Credit Agreement
and, to the extent provided in this Assignment and Acceptance, have the rights
and obligations of a Lender thereunder and (ii) the Assignor shall, to the
extent provided in this Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Credit Agreement.

        6.    Upon such acceptance and recording by Administrative Agent, from
and after the Effective Date, Administrative Agent shall make all payments under
the Credit Agreement and the Notes in respect of the interest assigned hereby
(including, without limitation, all payments of principal, interest and
commitment fees with respect thereto) to the Assignee. The Assignor and Assignee
shall make all appropriate adjustments in payments under the Credit Agreement
and the Notes for periods prior to the Effective Date directly between
themselves.

        7.    This Assignment and Acceptance shall be governed by, and construed
in accordance with, the Laws of the State of New York.

        8.    This Assignment and Acceptance may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement. Delivery of an executed
counterpart of Schedule 1 to this Assignment and Acceptance by telecopier shall
be effective as delivery of a manually executed counterpart of this Assignment
and Acceptance.

        IN WITNESS WHEREOF, the Assignor and the Assignee have caused Schedule 1
to this Assignment and Acceptance to be executed by their officers thereunto
duly authorized as of the date specified thereon.

100

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SCHEDULE 1
to
ASSIGNMENT AND ACCEPTANCE

Percentage interest assigned:       %      

--------------------------------------------------------------------------------

    Assignee's [Revolver/Term] Commitment:   $            

--------------------------------------------------------------------------------

    Aggregate outstanding principal amount   $       of [Revolver/Term] Loans
assigned:    

--------------------------------------------------------------------------------

   
Principal amount of [Revolver/Term] Note
 
$
 
 
  payable to Assignee:    

--------------------------------------------------------------------------------

   
Principal amount of [Revolver/Term] Note
 
$
 
 
  payable to Assignor:    

--------------------------------------------------------------------------------

   
Effective Date (if other than date
 
*
 
,
  of acceptance by Administrative Agent):    

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

       

    [NAME OF ASSIGNOR], as Assignor
 
 
By:
 
 
 
 
 
       

--------------------------------------------------------------------------------

      Title:
 
 
Dated:
 
,
 
 
         

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

   
 
 
[NAME OF ASSIGNEE], as Assignee
 
 
By:
 
 
 
 
 
       

--------------------------------------------------------------------------------

      Title:
 
 
Domestic Lending Office:
 
 
LIBOR Lending Office:

*This date should be no earlier than five Business Days after the delivery of
this Assignment and Acceptance to Administrative Agent.

101

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Accepted [and Approved] **
this    day of                        ,    
FLEET NATIONAL BANK
 
 
By:
 
 
 
     

--------------------------------------------------------------------------------

        Name:
Title:    
[Approved this            day
of                        ,            
 
 
PACIFIC ENERGY GROUP LLC
 
 
By:
 
 
 
     

--------------------------------------------------------------------------------

        Name:
Title:**
   

**Required if the Assignee is an Eligible Transferee solely by reason of
subsection (b) of the definition of "Eligible Transferee."

102

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QuickLinks

Exhibit 10.1

CREDIT AGREEMENT
TABLE OF CONTENTS
CREDIT AGREEMENT
W I T N E S S E T H
ARTICLE I— Definitions and References
ARTICLE II— The Loans and Letters of Credit
ARTICLE III— Payments to Lenders
ARTICLE IV— Conditions Precedent to Credit
ARTICLE V— Representations and Warranties
ARTICLE VI— Affirmative Covenants
ARTICLE VII— Negative Covenants
ARTICLE VIII— Events of Default and Remedies
ARTICLE IX— Administrative Agent
ARTICLE X—Miscellaneous
LENDER SCHEDULE

SCHEDULE 2

DISCLOSURE SCHEDULE

SCHEDULE 3

SECURITY SCHEDULE

EXHIBIT A-1

PROMISSORY NOTE [Revolver Note]

EXHIBIT A-2

PROMISSORY NOTE [Term Note]

EXHIBIT B

BORROWING NOTICE

EXHIBIT C

CONTINUATION/CONVERSION NOTICE

EXHIBIT D

CERTIFICATE ACCOMPANYING FINANCIAL STATEMENTS

EXHIBIT E

ASSIGNMENT AND ACCEPTANCE [Term Loans] [Revolver Loans](1)]
SCHEDULE 1 to ASSIGNMENT AND ACCEPTANCE