Exhibit 10.4


         COLLATERAL MORTGAGE             *     UNITED STATES OF AMERICA

                    BY                   *     STATE OF LOUISIANA

         SOUTH LOUISIANA ETHANOL, L.L.C  *     PARISH OF PLAQUEMINES
              Mortgagor                  *     *  *  *  *  *  *  *  *  *  *

         IN FAVOR OF                     *     BE IT KNOWN, that on this 31st

         ENGLOBAL ENGINEERING, INC.      *     day of the month of August, in


                                         *     the year of our Lord two thousand
                                         *     seven;
* *  *  *  *  *  *  *  *  *  *  *  *  *  *


     BEFORE ME, FRANCIS J. LOBRANO, a Notary Public, duly commissioned and
qualified, in and for the Parish of Plaquemines, State of Louisiana, therein
residing, and in the presence of the witnesses hereinafter named and
undersigned;

     PERSONALLY CAME AND APPEARED:

     SOUTH LOUISIANA ETHANOL, L.L.C., a Louisiana limited liability company
     domiciled in the Parish of Plaquemines, represented herein by its duly
     authorized Manager Kennett F. Stewart;

           Present Mailing Address: 278 E. Ravenna Road, Myrtle Grove,
                                 Louisiana 70037

which said appearer, hereinafter referred to as "Mortgagor", declared unto me,
Notary, that the purpose of this present act of mortgage is to enable them, when
occasion may require, either to sell hereinafter described mortgage note, or to
pledge or pawn said note as collateral security, from time to time, to secure
any loan or loans it may desire to make or as security for any obligations, upon
such terms and conditions as he may deem advisable and proper, it being
specifically understood that possession of the said mortgage note at any time by
the mortgagor shall not extinguish said note or this present mortgage securing
his payment, and that mortgagor shall have the right to issue and reissue said
note from time to time, as his convenience may require, without in any manner
extinguishing the said note or affecting the obligation of said note or the
security of this mortgage.

     For the purposes aforesaid, mortgagor does by these presents declare and
acknowledge a debt in the sum of FIFTEEN MILLION DOLLARS ($15,000,000.00), in
favor of ENGlobal Engineering, Inc. or any future holder or holders of their
said mortgage note, and, to evidence said indebtedness, has executed, under date
hereof, its Collateral Mortgage Note for the sum of FIFTEEN MILLION DOLLARS
($15,000,000.00) made payable on demand to the order of "Bearer" at 654 N. Sam
Houston Parkway, Suite 400, Houston, Texas 77060 and bearing EIGHTEEN (18.00 %)
PERCENT interest per annum from date until paid, which note, after having been
paraphed "Ne Varietur" by me, Notary, for identification herewith, was delivered
to the said mortgagee who hereby acknowledges receipt thereof.

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     Now, in order to secure the full and final payment of said note, if
negotiated, at its maturity, together with all interest, attorney's fees,
premiums of insurance, taxes, costs and other charges and/or the payment of any
other debt or note, or notes, for which the said mortgage note may be given or
pledged as collateral security, the said mortgagor declares that he does, by
these presents, specially mortgage, affect and hypothecate unto and in favor of
any future holder or holders of said mortgage note, whether the same be held as
an original obligation or in pledge, the hereinafter described property, to-wit:

     TRACT A-1A

     A CERTAIN PORTION OF GROUND located in Alliance and St. Rosalie
     Plantation, Section 5, T16S, R25E, Southeast District of Louisiana,
     West of the Mississippi River, Plaquemines Parish, Louisiana in an
     area bounded by La. State Highway No 23, the Mississippi River, above
     by Citrus Lands of Louisiana, and below by La. Power & Light co.,
     designated as Tract A-1C and described as follows:

          Commence from the intersection of the upper line of La. Power &
     Light Co. Property and the original easterly right of way line of La.
     State Highway 23 said point having coordinates X=2,430,858.48,
     Y=366,504.59 and go North 21(degree)56'19" West a distance of 416.07;
     thence go North 69(degree)07'01" East a distance of 2111.83 feet to
     the POINT OF BEGINNING. Thence continue North 69(degree)07'01" East a
     distance of 210.64 feet; thence go of North 20(degree)52'59" West a
     distance of 1301.27 feet; thence go of North 69(degree)07'01" East a
     distance of 1221.80 feet; thence go of South 24(degree)30'41" East a
     distance of 95.98 feet; thence go South 20(degree)53'09" East a
     distance of 505.11 feet; thence go of South 13(degree)29'42" East a
     distance of 159.40 feet; thence go of South 29(degree)50'59" East a
     distance of 220.75 feet; thence go of South 20(degree)49'56" East a
     distance of 332.00 feet; thence go of North 69(degree)07'01" East a
     distance of 170.23 feet; thence go of South 20(degree)43'33" East a
     distance of 358.55 feet; thence go of South 69(degree)08'57" West a
     distance of 1397.84 feet; thence go of North 20(degree)47'37" West a
     distance of 222.20 feet; thence go of North 63(degree)58'24" West a
     distance of 55.28 feet; thence go of South 69(degree)12'23" West a
     distance of 186.13 feet; thence go of North 20(degree)52'59" West a
     distance of 102.66 feet to the POINT OF BEGINNING.

          All as shown on a plan of resubdivision by Dufrene Surveying &
     Engineering Inc. dated July 3, 2006 and containing 48.9831 acres.

     Together with all the buildings and improvements, appurtenances and
attachments, rights, ways, privileges, servitudes, advantages, thereunto
belonging or in anywise appertaining, including all immovables by nature or
destination, now or hereafter forming part of and attached to or connected with
said property or used in connection therewith.

     Said property shall remain specially mortgaged, affected and hypothecated
unto and in favor of mortgagee and any future holder or holders of the
hereinafter described note until the full and final payment thereof, or up to
the full value of said note, together with interest, attorney's fees, costs and
other charges, said mortgagor hereby binding himself not to sell, mortgage,
encumber or deteriorate said property to the prejudice of this act.

     The said mortgagor further declared that it does by these presents,
consent, agree and stipulate that in the event said note is not paid punctually
when said note is due and matures, either as to principal or interest, or if
mortgagor herein becomes insolvent or applies to the bankruptcy court in any
proceeding under bankruptcy law or for adjudication in voluntary bankruptcy, or
if proceedings be instituted against mortgagor in involuntary bankruptcy, or any
proceedings be instituted against mortgagor looking toward the appointment of a
receiver, curator or syndic, or in the event of the non-payment of any taxes and
assessments levied against the herein described property, as hereinafter
required, or in the event that mortgagor failed to effect and maintain the
insurance required herein upon the improvements on the mortgaged property, or

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create or suffer to be created any other lien or charge superior in rank to the
mortgage herein granted, or if any proceedings shall be commenced against
mortgagor under any other mortgage, either superior or subordinate in rank to
this mortgage, bearing on and affecting all or any part of the property
mortgaged herein, or generally fail to do and perform any of the covenants
herein contained, then, in any event, at the option of any holder or holders of
the within described note, said note shall, ipso facto, become due, exigible and
payable, without any demand, protest or notice of any kind whatsoever, and
without any formal putting in default, or any other proceedings, and it shall be
lawful for, and mortgagor hereby authorizes the then holder or holders of said
herein described note to cause, all and singular, the property herein mortgaged
to be seized and sold under executory process, or any other process, issued by
any competent court, mortgagor hereby confessing judgment in favor of mortgagee
or any future holder or holders of the said note, and consenting, in the event
executory process be not resorted to, that by virtue of the confession of
judgment herein contained, mortgagor waives allotment, citation and all legal
notices and delays and consents that judgment may be rendered, signed and
executed immediately, either in vacation, or term time. Mortgagor specifically
waives the benefit of any and all laws, or parts of laws, relative to the
appraisement of property seized or sold under executory process, or any other
process, and consents and agrees that said property may be sold without
appraisement to the highest bidder, for cash, said mortgagor hereby expressly
dispensing with all and any appraisement of said property.

     Mortgagor binds himself to keep the buildings and improvements on the
property herein mortgaged constantly insured against loss by fire and against
such other risks as mortgagee may designate up to the full amount of the
aforesaid note and to transfer the policy or policies of insurance to the holder
or holders of the said note, hereby consenting and agreeing that any holder of
said note shall have the right to transfer any such policy to any future holder
or holders of said note. In case of the mortgagor's failure to effect such
insurance, the holder or holders of the said note shall have the right to do so,
and the reimbursement of any sums paid for that purpose shall be secured by the
within mortgage, but this clause shall not be construed as obligatory on any
holder or holders of said note, or as making any of them liable for any loss,
damage or injury which may result from the non-insurance of said buildings and
improvements. In any event, it shall be at the exclusive option of the holder or
holders of the said note to treat mortgagor's failure to insure said buildings
and improvements as a breach of mortgagor's obligations hereunder, maturing the
said note and authorizing the holder or holders of said note to proceed either
by executory process, or other legal process, as hereinabove provided.

     Mortgagor specifically agrees to pay all taxes, charges or assessments on
said property, and, in the event that tax charges or assessments become
delinquent, any holder or holders of said note, at his or their option, is fully
authorized to pay the same, and thereby become subrogated to all the rights and
privileges of the City, Parish or the State, or other governmental taxing
authority, it being agreed that any holder or holders of said note shall be
entitled to interest at the rate of EIGHTEEN (18%) percent per annum on any
amount so advanced or paid from the date of such payment until reimbursement,
the mortgage hereinabove granted being extended to cover the amount of such
taxes, charges, assessments, interest and all costs. In any event, it shall be
at the exclusive option of the holder or holders of said note to treat
mortgagor's failure to pay such taxes, charges and assessments as a breach of
mortgagor's obligation hereunder, maturing the said note and authorizing the
holder or holders of said note to proceed either by executory process, or other
legal process, as hereinabove provided.

     It is further understood and agreed that in the event of the passage, after
the date of this mortgage, of any law deducting from the value of land for the
purpose of taxation, any lien thereon, or changing in any way the laws now in
force for the taxation of mortgages or debts secured by mortgages or the manner
of the collection of any such taxes, so as to affect this mortgage or in any
manner seeking to enforce the payment of such taxes by the mortgagee or any
future holder or holders of the said note, then and in any of said events the
mortgagor binds and obligates himself to pay any and all taxes which may be
assessed against the mortgagee by reason of this mortgage, to the complete

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exoneration and discharge of said mortgagee. In default of such payment by the
mortgagor, the mortgagee may pay said tax, and the amount so paid, with interest
thereon at the rate set forth in the said note from date of such payment, shall
be secured by the mortgage herein granted.

     The said mortgagor further binds and obligates himself to keep the
mortgaged property, including all fences, buildings and other improvements now
on the said premises or hereafter put thereon, in good condition and repair, and
generally to do no act by which the value of said mortgaged premises may be
impaired.

     Mortgagor warrants that there are no unpaid labor or materialmen's or other
claims, liens or privileges for repairs or renovations to or constructions upon
the herein described property outstanding and unpaid on the date hereof which
would prime the mortgage herein granted. It is further understood and agreed
that after the date of this mortgage said mortgagor, before entering into any
contract or agreement, either verbal or written, recorded or unrecorded, whereby
any lien, privilege, mortgage or other encumbrance in favor of any mechanic,
builder, artisan, workman, laborer, or any other person, or in favor of any
furnisher of material, supplies, machinery or fixtures is created, shall obtain
the written consent of the mortgagee, and in default of such written consent,
the entering into of such agreement or contract shall be deemed a fraud upon the
rights of the holder or holders of said note and shall entitle said holder or
holders of said note to declare the entire debt herein secured immediately due
and payable, and to institute foreclosure proceedings thereon.

     In the event default is made in payment of any installment, if the note or
notes secured by this mortgage provide for payment thereof in installments, or
in the event default is made in payment of any note, if a series of notes is
secured by this mortgage, at the option of any holder thereof, all remaining
unpaid installments and/or notes may be declared at once due and payable in
full.

     The said mortgagor moreover binds himself in case it should become
necessary to place said note in the hands of an attorney for collection or to
protect the rights of any holder thereunder, or to institute suit for the
recovery of the amount of said note, or any interest, or any part thereof, to
pay the fees of the attorney-at-law who may be employed for that purpose, which
fees are hereby fixed at 25% PERCENT on the amount due or sued for.

     Now to secure the faithful performance of all of mortgagor's obligations,
and the reimbursement and payment of said note and attorney's fees, taxes and
premiums of insurance, as above specified, the mortgagor does by these presents
further specially mortgage and hypothecate the hereinabove described property
unto and in favor of said mortgagee and all future holder or holders of said
note hereby confessing judgment for the full amount of said note in principal
and interest, together with all costs, attorney's fees, taxes and premiums of
insurance.

     The mortgagor binds and obligates himself to reinscribe this mortgage in
the manner in which the original recordation was made in the records of the
Recorder of Mortgages for the Parish in which said original recordation was made
on or before one year prior to the date of the expiration of each successive
period after which this mortgage would be barred by prescription unless
reinscribed, said reinscription to be made at the expense and cost of the
mortgagor. In the event mortgagor shall default in complying with this
obligation to reinscribe this act on or before the date specified, and in the
manner provided, then and in that case, the entire amount due on the note, or
notes secured by this mortgage, together with all interest, attorney's fees,
insurance premiums, costs and expenses, shall at the option of the holder or
holders of the said note or notes, immediately become due and payable, or, in
the alternative, the holder or holders of the said note or notes, may at his or
their option, cause this mortgage to be reinscribed in the records of the
aforesaid Recorder of Mortgages, at the cost of mortgagor.

     The mortgagor agrees that the herein mortgaged property shall not be sold
or transferred with the right of assumption of the balance due on the herein
mortgage without the prior written consent of the mortgagee, or any future
holder or holders of the note or notes secured by this mortgage, the mortgagee
reserving the right to demand the immediate payment of the balance on the
aforesaid note, with interest, should the mortgagor violate these covenants.

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     Any extensions granted or allowed for the payment of said note or notes, or
any installment thereof, or for the performance of any other obligations assumed
herein by the mortgagor, shall not be construed as a waiver of any of the rights
of the mortgagee or any holder or holders of said note or notes.

     It is specifically understood that the stipulations and obligations of the
within described note or notes, and of this mortgage, are joint and solidary as
to the makers of the said note or notes and the mortgagor herein. It is
specifically understood that all the obligations of the said note or notes and
this said act shall be binding upon the heirs, successors, executors,
administrators, representatives and assigns of each and every note maker or
mortgagor hereunder, and that whenever used herein any word importing the
singular shall as well include the plural and any pronoun importing gender shall
include the masculine, feminine or neuter. "Mortgagee" shall be deemed to
include the named mortgagee herein as well as any and all future holder or
holders of the note or notes secured hereby.

     The parties hereto acknowledge that there has been called to their
attention by the undersigned Notary encroachments and restrictions, if any, as
shown on a survey or in the chain of title, and they hereby release and relieve
the attorney who examined the title and the undersigned Notary from any and all
responsibility in connection therewith.

     Mortgagor warrants that there are no unpaid labor or materialmen's or other
claims or privileges for repairs or renovations to or constructions upon the
herein described property outstanding and unpaid on the date hereof which would
prime the mortgage herein granted.

     The parties to this Act waive all Certificates required by law and relieve
and release me, Notary, from the non-production of same.

     THUS DONE AND PASSED in my office in the Parish and on the day, month and
year herein first above written, in the presence of the undersigned competent
witnesses, who hereunder sign their names with the said appearers, and me,
Notary, after reading of the whole.

WITNESSES:                                  MORTGAGOR

                                            SOUTH LOUISIANA ETHANOL, L.L.C.


---------------------------------           ------------------------------------
                                            BY:  KENNETT F. STEWART
                                            TITLE:  MANAGER


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                    ----------------------------------------
                                  NOTARY PUBLIC



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