EXHIBIT 10.4

                       NONQUALIFIED STOCK OPTION AGREEMENT


      This Nonqualified Stock Option Agreement  ("Option  Agreement") is between
Howell    Corporation,    a   Delaware    corporation    (the   "Company")   and
___________________ (the "Optionee").

                        W I T N E S S E T H:

      WHEREAS, to carry out the purposes of the Howell Corporation Omnibus Stock
Awards and  Incentive  Plan (the "Plan") by  providing  for the  acquisition  of
proprietary  interests in the Company through the award of a nonqualified  stock
option providing for acquisition  rights in the common stock of the Company,  to
retain and attract personnel of outstanding  ability,  and to provide additional
motivation to the Employee to continue to exert  Employee's best efforts for the
success  and   welfare  of  the  Company  and  the  benefit  of  the   Company's
stockholders,  the  Committee (as defined in the Plan) has  determined  that the
Company's  interests  will  be  advanced  by  the  issuance  to  Optionee  of  a
nonqualified stock option under the Plan.

      NOW THEREFORE,  for and in consideration of these premises it is agreed as
follows:

      1. Option.  Subject to the  terms and  conditions  contained  herein,  the
Company hereby irrevocably grants to Optionee the right and option ("Option") to
purchase  from  the  Company  _____________________  (_________)  shares  of the
Company's  common  stock,  $1.00  par  value  ("Common  Stock"),  at a price  of
$__________ per share.

      2. Option Period.  The Option herein  granted may be exercised by Optionee
in whole or in part at any time  during a ten  (10)  year  period  (the  "Option
Period") beginning on ________________,  1999 (the "Grant Date"), subject to the
limitation  that said Option shall not be exercisable for more than a percentage
of the  aggregate  number of shares  offered by this  Option  determined  by the
number of full years of employment with the Company or its Affiliates  beginning
on the Grant Date in accordance with the following schedule:

             Number of                       Percentage of
             Full Years                   Shares Purchasable
           -------------                  ------------------
           Less than one                          0%
           One                                   25%
           Two                                   50%
           Three                                 75%
           Four or more                         100%

Notwithstanding  anything in this Agreement to the contrary,  the Committee,  in
its sole discretion may waive the foregoing schedule of vesting and upon written
notice to the  Optionee,  accelerate  the earliest date or dates on which any of
the Options granted hereunder are exercisable.
<PAGE>

      3. Procedure for  Exercise.  The Option herein granted may be exercised by
written  notice by Optionee to the  Secretary of the Company  setting  forth the
number of  shares of Common  Stock  with  respect  to which the  Option is to be
exercised accompanied by payment for the shares to be purchased,  and specifying
the address to which the certificate for such shares is to be mailed. The notice
shall be accompanied by (i) cash, cashier's check, bank draft, postal or express
money order payable to the order of the Company, or other immediately  available
funds,  or (ii) at the election of the Optionee and agreed to by the  Committee,
certificates  representing  shares of Common Stock theretofore owned by Optionee
duly  endorsed  for  transfer to the Company,  or (iii) any  combination  of the
preceding, equal in value to the aggregate exercise price. The Committee, in its
sole discretion,  may allow for a "cashless  exercise" as described in the Plan.
Notice may also be delivered by fax or telecopy provided that the exercise price
of such shares is received by the Company via wire  transfer on the same day the
fax or telecopy  transmission is received by the Company.  An option to purchase
shares of Common  Stock in  accordance  with this Plan,  shall be deemed to have
been  exercised  immediately  prior  to the  close of  business  on the date (i)
written  notice of such exercise and (ii) payment in full of the exercise  price
for the  number  of shares  for which  Options  are  being  exercised,  are both
received by the Company and  Optionee  shall be treated for all  purposes as the
record holder of such shares of Common Stock as of such date.

      As  promptly  as  practicable  after  receipt of such  written  notice and
payment,  the Company shall deliver to Optionee  certificates  for the number of
shares  with  respect to which  such  Option  has been so  exercised,  issued in
Optionee's name or such other name as Optionee directs; provided,  however, that
such delivery  shall be deemed  effected for all purposes when a stock  transfer
agent of the Company shall have deposited such certificates in the United States
mail, addressed to Optionee at the address specified pursuant to this Section 3.

      4. Termination of  Employment.  If Optionee's  employment with the Company
or its Affiliates is terminated during the Option Period for any reason, Options
which are exercisable by the Optionee  pursuant to Section 2 on the date of such
termination of employment shall expire on the earlier of (i) six months from the
date of the Optionee's  termination  of employment or (ii) the remaining  Option
Period  established  for the Option pursuant to Section 2. Any Options which are
not  exercisable  by the  Optionee  pursuant  to  Section  2 on the  date of the
Optionee's   termination  of  employment  shall  expire  on  the  date  of  such
termination of employment.

      5.  Transferability.  This Option  shall not be  transferable  by Optionee
otherwise  than by Optionee's  will or by the laws of descent and  distribution.
During the lifetime of Optionee,  the Option shall be  exercisable  only by him.
Any heir or legatee of Optionee shall take rights herein granted  subject to the
terms and conditions  hereof. No such transfer of this Option Agreement to heirs
or legatees  of  Optionee  shall be  effective  to bind the  Company  unless the
Company shall have been furnished with written notice thereof and a copy of such
evidence as the  Committee  may deem  necessary to establish the validity of the
transfer and the  acceptance by the  transferee or  transferees of the terms and
conditions hereof.

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<PAGE>
      6.  No  Rights  as  Stockholder.  Optionee  shall  have  no  rights  as  a
stockholder  with respect to any shares of Common  Stock  covered by this Option
Agreement  until the Option is exercised by written  notice and  accompanied  by
payment as provided in Section 3 above.  Until such time,  Optionee shall not be
entitled  to  dividends  attributable  to such  shares or to vote such shares at
meetings of the  stockholders  of the  Company.  Except as provided in Section 8
hereof,  no adjustment shall be made for dividends  (ordinary or  extraordinary,
whether in cash or securities or other property) paid or  distributions or other
rights granted in respect of any share of Common Stock for which the record date
for such  payment,  distribution  or grant is prior to the date  upon  which the
Optionee  shall have  exercised said Option by written notice and payment to the
Company, as provided hereinabove.

      7. Corporate Transactions.

           a. If the  Company  is  reorganized,  merged  or  consolidated  or is
otherwise a party to a plan of exchange  with  another  corporation  pursuant to
which reorganization, merger, consolidation or plan of exchange, shareholders of
the Company  receive any shares of Common  Stock or other  securities  or if the
Company shall distribute  ("Spin Off") securities of another  corporation to its
shareholders,  there  shall  be  substituted  for  the  shares  subject  to  the
unexercised  portion of the Option an  appropriate  number of shares of (i) each
class of stock or other securities which were distributed to the shareholders of
the Company in respect of such shares in the case of a  reorganization,  merger,
consolidation  or plan of  exchange,  or (ii)  in the  case of a Spin  Off,  the
securities  distributed to shareholders  of the Company  together with shares of
Common Stock, such number of shares or securities to be determined in accordance
with the  provisions  of Section 425 of the Internal  Revenue  Code of 1986,  as
amended (the "Code") (or other applicable  provisions of the Code or regulations
issued  thereunder which may from time to time govern the treatment of incentive
stock options in such a transaction);  provided, however, that the Option may be
canceled  by the  Company  as of the  effective  date  of (x) a  reorganization,
merger,  consolidation,  plan of exchange or Spin Off or (y) any  dissolution or
liquidation  of the  Company,  by giving  notice to the Optionee or his personal
representative  of its intention to do so and by  permitting  the purchase for a
period of at least  thirty  days  during  the sixty  days  next  preceding  such
effective date of all of the shares subject to the Option;  and provided further
that in the  event of a Spin  Off,  the  Company  may,  in lieu of  substituting
securities or accelerating and canceling the Option as contemplated above, elect
(i) to reduce the purchase  price for each share of Common Stock  subject to the
Option by an amount equal to the fair market value,  as determined in accordance
with the provisions of Section II(m) of the Plan, of the securities  distributed
in respect of each outstanding  share of Common Stock in the Spin Off or (ii) to
reduce   proportionately   the   purchase   price  per  share  and  to  increase
proportionately  the number of shares of Common  Stock  subject to the Option in
order to  reflect  the  economic  benefits  inuring to the  shareholders  of the
Company as a result of the Spin Off.

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<PAGE>
           b. The Option shall become fully exercisable upon a Change in Control
of the  Company (as  defined in the next  sentence).  "Change in Control" of the
Company  shall be  conclusively  deemed to have occurred if (and only if) any of
the following shall have taken place: (i) a change in control is reported by the
Company in response to Item 1 of Form 8-K (or any successor  item of Form 8-K or
any similar item of any other report  required to be filed by the Company  under
the  Securities  Exchange Act of 1934, as amended  ("Exchange  Act"));  (ii) any
"person"  (as such term is used in Sections  13(d) and  14(d)(2) of the Exchange
Act) is or becomes  the  "beneficial  owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Company representing
forty  percent  or more of the  combined  voting  power  of the  Company's  then
outstanding securities; or (iii) following the election or removal of directors,
a majority  of the Board  consists  of  individuals  who were not members of the
Board two years  before such  election or removal,  unless the  election of each
director  who was not a director at the  beginning of such  two-year  period has
been  approved in advance by directors  representing  at least a majority of the
directors  then in office who were  directors  at the  beginning of the two-year
period.

           c.  Except  as  hereinbefore  expressly  provided,  the  issue by the
Company  of shares of stock of any  class,  or  securities  convertible  into or
exchangeable  for shares of stock of any  class,  for cash or  property,  or for
labor or  services,  either upon  direct sale or upon the  exercise of rights or
warrants to subscribe  therefor,  or upon conversion of shares or obligations of
the Company  convertible  into or exchangeable  for shares of stock of any class
shall not affect, and no adjustment by reason thereof shall be made with respect
to,  the  number of  shares  of  Common  Stock  subject  to the  Option  granted
hereunder.

      8. Changes  in  Capital  Structure.  The existence of outstanding  Options
shall  not  affect  in  any  way  the  right  or  power  of the  Company  or its
shareholders  to make or authorize  any or all  adjustments,  recapitalizations,
reorganizations  or other  changes in the  Company's  capital  structure  or its
business,  or any merger or  consolidation  of the  Company,  or any issuance of
Common  Stock  or  subscription  rights  thereto,  or  any  issuance  of  bonds,
debentures, preferred or prior preference stock ahead of or affecting the Common
Stock or the rights  thereof,  or the dissolution or liquidation of the Company,
or any sale or  transfer  of all or any part of its assets or  business,  or any
other corporate act or proceedings, whether of a similar character or otherwise.
If the  outstanding  shares of Common Stock of the Company  shall at any time be
changed or exchanged by a subdivision or consolidation of shares of Common Stock
or other capital readjustment,  a declaration of a stock dividend,  stock split,
combination  of  shares,  or  recapitalization,  the  number  and kind of shares
subject to the Plan or  subject  to any  Options  theretofore  granted,  and the
Option prices,  shall be appropriately and equitably  adjusted so as to maintain
the proportionate number of shares without changing the aggregate Option price.

      9.  Compliance With  Securities  Laws. Upon the  acquisition of any shares
pursuant to the exercise of the Option herein  granted,  Optionee (or any person
acting under Section 5) will enter into such written representations, warranties
and  agreements  as the Company may  reasonably  request in order to comply with
applicable securities laws or with this Option Agreement.

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<PAGE>
      10.  Compliance With  Laws.  Notwithstanding  any of the other  provisions
hereof,  Optionee agrees that he will not exercise the Option(s) granted hereby,
and that the Company will not be obligated to issue any shares  pursuant to this
Option  Agreement,  if the  exercise of the  Option(s)  or the  issuance of such
shares of Common  Stock would  constitute  a violation by the Optionee or by the
Company of any provision of any law or regulation of any governmental authority.

      11.  Withholding of Tax. To the extent that the exercise of this Option or
the  disposition  of shares of Common Stock  acquired by exercise of this Option
results in  compensation  income to the Optionee for federal or state income tax
purposes,  the Optionee shall pay to the Company at the time of such exercise or
disposition (or such other time as the law permits if the Optionee is subject to
Section  16(b) of the  Exchange  Act) such  amount of money as the  Company  may
require to meet its obligation under applicable tax laws or regulations; and, if
the Optionee fails to do so, the Company is authorized to withhold from any cash
remuneration then or thereafter payable to the Optionee,  any tax required to be
withheld  by  reason  of such  resulting  compensation  income  or  Company  may
otherwise refuse to issue or transfer any shares otherwise required to be issued
or transferred  pursuant to the terms hereof.  Payment of the withholding tax by
the Optionee shall be made in accordance with Section XII(e) of the Plan.

      12. Resolution of  Disputes.  As a condition of the granting of the Option
hereby,  the  Optionee  and his heirs and  successors  agree that any dispute or
disagreement  which may arise  hereunder shall be determined by the Committee in
its sole  discretion  and  judgment,  and that  any such  determination  and any
interpretation  by the Committee of the terms of this Option  Agreement shall be
final and shall be binding and conclusive,  for all purposes,  upon the Company,
Optionee, his heirs and personal representatives.

      13. Legends on  Certificate.  The certificates  representing the shares of
Common  Stock  purchased  by exercise of an Option will be stamped or  otherwise
imprinted  with  legends in such form as the  Company or its counsel may require
with respect to any  applicable  restrictions  on sale or transfer and the stock
transfer  records of the Company will reflect  stop-transfer  instructions  with
respect to such shares.

      14. Compliance With. Every  notice hereunder shall be in writing and shall
be given by  registered  or certified  mail.  All notices of the exercise of any
Option hereunder shall be directed to Howell Corporation,  1500 Howell Building,
1111 Fannin, Houston, Texas 77002-6923,  Attention:  Secretary. Any notice given
by the  Company  to  Optionee  directed  to him at his  address on file with the
Company  shall be effective  to bind him and any other person who shall  acquire
rights hereunder.  The Company shall be under no obligation whatsoever to advise
Optionee of the existence,  maturity or termination of any of Optionee's  rights
hereunder  and Optionee  shall be deemed to have  familiarized  himself with all
matters  contained  herein and in the Plan  which may  affect any of  Optionee's
rights or privileges hereunder.

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<PAGE>
      15. Construction and Interpretation.  Whenever the term "Optionee" is used
herein  under  circumstances  applicable  to any other person or persons to whom
this  award,  in  accordance  with the  provisions  of Section 5 hereof,  may be
transferred,  the word  "Optionee"  shall be deemed to  include  such  person or
persons.  References  to the  masculine  gender herein also include the feminine
gender for all purposes.

      16.  Agreement  Subject to Plan. This  Option  Agreement is subject to the
Plan. The terms and provisions of the Plan (including any subsequent  amendments
thereto) are hereby  incorporated herein by reference thereto. In the event of a
conflict between any term or provision  contained herein and a term or provision
of the Plan,  the  applicable  terms and  provisions of the Plan will govern and
prevail.  All  definitions  of words and terms  contained  in the Plan  shall be
applicable to this Option Agreement.

      17. Employment  Relationship.  Employees  shall be considered to be in the
employment  of the Company as long as they remain  employees of the Company or a
parent or subsidiary  corporation  (as defined in Section 424 of the Code).  Any
questions as to whether and when there has been a termination of such employment
and the cause of such termination, shall be determined by the Committee, and its
determination  shall be final.  Nothing  contained  herein shall be construed as
conferring upon the Optionee the right to continue in the employ of the Company,
nor shall  anything  contained  herein be construed or  interpreted to limit the
"employment at will" relationship between the Optionee and the Company.

      18. Binding Effect.  This Option Agreement shall be binding upon and inure
to the  benefit  of any  successors  to the  Company  and all  persons  lawfully
claiming under Optionee.

      IN WITNESS WHEREOF,  this Option Agreement has been executed as of the ___
day of _____________, 1999.

ATTEST:                        HOWELL CORPORATION



______________________________ By:_________________________________




                               OPTIONEE



                               ____________________________________


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