Exhibit 10.1

AMENDMENT NO.1 TO
WATER AND FUEL OIL AGREEMENT

THIS AMENDMENT NO. 1 TO WATER AND FUEL OIL AGREEMENT (this “Amendment”) is made
as of March 21, 2007 (the “Effective Date”), by and among Otter Tail
Corporation, d/b/a Otter Tail Power Company, as operating agent (“Offer Tail”)
for Montana-Dakota Utilities Co., a division of MDU Resources Group, Inc.,
NorthWestern Energy, a division of NorthWestern Corporation, and Otter Tail
Power Company (individually “Party” or “Owner” and collectively the “Parties” or
“Big Stone Plant Co-Owners”), having its principle office at the offices of
Otter Tail Power company, 215 South Cascade Street, City of Fergus Falls, State
of Minnesota, and Northern Lights Ethanol, LLC, having its principal office at
1303 East Fourth Avenue, Milbank, South Dakota (“Northern Lights”).

RECITALS

WHEREAS, the Parties desire to amend, as of the Effective Date, that certain
Water and Fuel Oil Agreement among the Parties, dated as of August 15, 2001 (the
“Agreement”), to reflect changes to the amount of water available to Northern
Lights’ ethanol facility and supporting elements located near the Big Stone
Generation Plant (the “Project”) as a result Northern Lights’ expansion.

NOW, THEREFORE, in consideration of the agreements and covenants set forth
herein, and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, and intending to be legally bound by this
Amendment, the Parties covenant and agree as follows:

1.             Amendment.  The Agreement is amended as follows:

a.             Attachment A:

1) Attachment A is hereby amended to provide that the TDS parameter of “<1,000
mg/liter” is hereby replaced with “<10,000 mg/liter.”

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2)     In the first sentence of Attachment A, the words “Cooling Pond” shall be
replaced with the words “Holding Pond.”

b.             Attachment B:

The Attachment B, attached to the Agreement, is hereby replaced by the
Attachment B that is attached to this Amendment.

c.             Section Two shall be deleted in its entirety and replaced by the
following:

“Section Two. Distilled Water and Cooling Pond Water:

2.1           Otter Tail will:

a.             Provide to the Project up to 300 gallons per minute (“gpm”) of
distilled water from its brine concentrator and/or makeup pond upon a schedule
which will permit Northern Lights to maintain continuous operation, with the
Project providing storage capacity at its location of 40,000 gallons of
distilled water.

b.             Provide to the Project up to 400.gpm of water from its Cooling
Pond after Northern Lights’ first uses an annual average of 250 gpm of distilled
water.  Said Cooling Pond water shall be provided on an “as is” basis.

c.             Determine the amount of distilled water and Cooing Pond water
actually provided to the Project and bill Northern Lights for water delivered to
the Project at the rates set forth in Attachment B attached hereto and made a
part hereof.

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2.2           Northern Lights will:

a.             Construct, maintain and pay all costs associated with the
construction and maintenance of pumps and pipelines to transport water from the
Big Stone Plant brine concentrator, makeup pond, and Cooling Pond to the
Project.

b.             Install and maintain, at Northern Lights’ sole expense, a water
meter and measure the water received by Northern Lights from Otter Tail’s brine
concentrator, makeup pond, cooling pond.

c.             Pay to Otter Tail, within 30 days of receipt of Otter Tail’s
invoice for water received from the brine concentrator, makeup pond, and/or
Cooling Pond, at the rates set forth in Attachment B.

d.             Use all water for industrial use pursuant to the Big Stone Plant
Water Appropriation Permit.

e.             Maintain a storage capacity for distilled water of at least
40,000 gallons.

f.              Grant Otter Tail access to inspect water meter and make
measurement as described in 2.1.

d.             A new Section Six is added. Section Six shall provide as follows:

“Section Six. In case of prolonged drought, Otter Tail may need to curtail
distilled and/or Cooling Pond water to the Project.  Otter Tail, at its sole
discretion, may take this action whenever Big Stone Lake level drops below 967
feet Mean Sea Level for more than 90 continuous days.”

2.             Continuing Effect; Ratification.  Except as expressly amended
herein, all other terms, covenants and conditions contained in the Agreement
shall continue to remain unchanged and in full force and effect and are hereby
ratified and confirmed.

3.             Governing Law.  This Amendment shall be interpreted and enforced
in

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accordance with the laws of the State of South Dakota, notwithstanding any
conflict of law provision to the contrary.

4.             Captions.  All titles, subject headings, Section titles and
similar items are provided for the purpose of reference and convenience and are
not intended to affect the meaning of the content or scope of this Amendment.

5.             Counterparts.  This Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which, when so executed and delivered, shall be deemed to be an original, and
all of which, taken together, shall constitute but one in the same instrument.

6.             Authority.  Each signatory to this Amendment represents that
he/she has the authority to execute and deliver this Amendment on behalf of the
Party set forth above its signature.

[SIGNATURE PAGES FOLLOW -
THE REMAINDER OF THIS PAGE IS INTENTIONALLY BLANK]

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IN WITNESS WHEREOF, the Parties hereto have caused their names to be hereunto
subscribed by their officers, intending thereby that this Amendment shall be
effective as of the Effective Date.

OWNERS:

 

 

 

OTTER TAIL CORPORATION

 

Doing business as Otter Tail Power Company,

 

As Agent for Co-Owners

 

 

 

 

 

By:

/s/ Jeffrey D. Endrizzi

 

 

 

 

 

 

Printed Name:

JEFFREY D. ENDRIZZI

 

 

 

 

 

 

Title:

PLANT MANAGER

 

 

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IN WITNESS WHEREOF, the Parties hereto have caused theft names to be hereunto
subscribed by their officers, intending thereby that this Amendment shall be
effective as of the Effective Date.

NORTHERN LIGHTS ETHANOL, LLC

 

 

 

 

 

By:

/s/ Delton Strasser

 

 

 

 

 

 

Printed Name:

DELTON STRASSER

 

 

 

 

 

 

Title:

PRESIDENT

 

 

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ATTACHMENT B

RATES

Water

Northern Lights’ shall pay for Distilled water at the rate of $4.00 per 1,000
gallons.

Water from the Cooling Pond shall be billed initially at $1.00 per 1,000
gallons.  The rates for distilled water and Cooling Pond water are subject to an
annual adjustment as follows: The water charge shall be adjusted by the change
in the average Btu cost of fuel to the Big Stone Plant with that change
multiplied by 50%.

Also, Northern Lights first shall use an annual average of 250 gpm of distilled
water before drawing water from the Big Stone Cooling Pond.

Rail Access

Rail access shall be assessed initially at $7.50 per car brought across the Big
Stone spur line to the Northern Lights’ spur line. (Across spur line implies
round trip.) Rail access assessment shall be subject to adjustment every five
year period as follows:

The rail access assessment shall be adjusted upwards by 10% every five years.

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