<PAGE>
 
                                                                   EXHIBIT 10.40


                   [LOGO OF FOSTER WHEELER USA CORPORATION]


                        FOSTER WHEELER USA CORPORATION
        2020 DAIRY ASHFORD . HOUSTON, TEXAS 77077 . PHONE 281-597-3000

                                                              September 25, 1997
                                               Letter No.: 13-037624 - 2.1 - 104
                                                           File No.: 37624 - 2.1

Mr. Jim Trigg
General Manager
Seadrift Coke L.P.
P.O. Box 192
Port Lavaca, Texas 77979

SUBJECT:   Seadrift Coke L.P.
           Port Lavaca, Texas
           Coker Expansion Project
           SEADRIFT COKE L.P./FWUSA ENGINEERING, PROCUREMENT AND
           -----------------------------------------------------
           CONSTRUCTION AGREEMENT FOR COKER EXPANSION PROJECT
           --------------------------------------------------

Dear Jim,

Please find attached one fully executed original of the subject Agreement for 
your files.

                                                          Very truly yours,
                                                          /s/ Mike Veit
                                                          Mike Veit
                                                          Project Manager

MV:sw


cc:   M. Autrey
      I. Bremner
      D. Pettit
      J. Archambault, Esq.
<PAGE>
 
                         ENGINEERING, PROCUREMENT, AND

                            CONSTRUCTION AGREEMENT

                                    BETWEEN

                            SEADRIFT COKE, L.P. AND

                      FOSTER WHEELER USA CORPORATION

                                      FOR

                            COKER EXPANSION PROJECT
<PAGE>
 
                                     INDEX
                                     -----
                                        
ARTICLE DESCRIPTION
------- -----------


1       DEFINITIONS
2       SERVICES BY FWUSAC
3       SERVICES BY OWNER
4       PRICE
5       TERMS OF PAYMENT
6       RELATIONSHIP OF THE PARTIES
7       PRICE ADJUSTMENT
8       CHANGES IN THE WORK
9       TIME OF PERFORMANCE
10      INSURANCE
11      INDEMNIFICATION FOR BODILY INJURIES AND PROPERTY DAMAGES
12      TITLE AND RISK OF LOSS TO MATERIALS & EQUIPMENT
13      RECORDS AND ACCOUNTING
14      MECHANICAL ACCEPTANCE; COMPLETION OF THE WORK

15      GUARANTEES AND WARRANTIES
16      INDEMNIFICATION AGAINST PATENT INFRINGEMENT
17      INDUSTRIAL PROPERTY RIGHTS
18      LIEN INDEMNIFICATION
19      CONTINUOUS PROSECUTION OF THE WORK
20      FORCE MAJEURE
21      CONSEQUENTIAL DAMAGES
22      ASSIGNMENT OF AGREEMENT
23      SUBCONTRACTING
24      WAIVER
25      NOTICES
26      SUSPENSION OF THE WORE
27      TERMINATION OF THE WORK
28      CAPTIONS
29      CONTROLLING LAW
30      SEVERABILITY
31      ENTIRETY OF CONTRACT



                                       2
<PAGE>
 
EXHIBIT  DESCRIPTION
-------  -----------


A        SCOPE OF WORK
B        COMPENSATION BASIS
C        PROJECT SCHEDULE
D        PLANT COMPLETION STANDARD


                                       3
<PAGE>
 
  THIS Agreement (hereinafter "Agreement") is made effective the 2nd day of
June, 1997, hereinafter ("EFFECTIVE DATE") between SEADRIFT COKE, L.P.
(hereinafter "OWNER"), a Texas limited partnership, with its principal offices
at Port Lavaca, Texas and FOSTER WHEELER USA CORPORATION (hereinafter "FWUSAC"),
a Delaware corporation, with its principal offices at Perryville Corporate Park,
Clinton, New Jersey.

                                WITNESSETH

  WHEREAS, OWNER desires to have constructed a COKER EXPANSION PROJECT
(hereinafter referred to as the "Plant") on its real property located at the
OWNER's Seadrift, Texas facility;

  WHEREAS, OWNER desires FWUSAC to undertake the performance of certain required
engineering, procurement, and construction work and services for the Plant; and

  WHEREAS, FWUSAC desires to undertake the performance of said work and services
for the Plant;

  NOW, THEREFORE, the parties hereto, in consideration of their respective
obligations, undertakings and commitments hereinafter set forth, covenant and
agree as follows:

1.  DEFINITIONS

  Wherever used in this Agreement or in the other Contract Documents,
hereinafter defined, the following terms have the meanings indicated which are
applicable to both the singular and plural thereof:

1.1  "Agreement" or "Contract" means the Agreement between the parties hereto
covering the Work to be performed as represented and constituted by the Contract
Documents, which are attached to the Agreement and made a part thereof.

1.2  "Completion of Construction" means FWUSAC has:
        a)  Provided erection in accordance with the drawings and
              specifications;
        b)  Completed its portion of the pre-commissioning Work;
        c)  Completed final cleanup, painting and insulation Work; and
        d)  Delivered all required documentation to the OWNER.

1.3  "Construction Aids" means any or all materials, supplies, and temporary
facilities and such other items as are required for construction of the Plant,
but which are not intended to become a permanent part of the Plant.

1.4  "Contract Documents" means and includes this Agreement with all its
Exhibits, attachments and all Specifications, Drawings, Modifications and
Appendices hereto.

1.5  "Contract Price" means the total of the amounts to be paid to FWUSAC
pursuant to this Agreement.

1.6  "Drawings" means all drawings which show the character and scope of the
Work to be performed and which have been produced by or for FWUSAC in the
design, construction, and erection of the Plant.

1.7  "Equipment" means any and all material, supplies, equipment and facilities
of whatever nature designed or specified by FWUSAC hereunder and intended to
become a permanent part of the Plant.

                                       4
<PAGE>
 
1.8   "Modification" means (1) a written amendment to the Contract Documents
signed by both parties hereto or (2) a Change Order as provided for in Article
8 herein.

1.9   "Plant" or "Project" means the COKER EXPANSION PROJECT and related
equipment and systems to be built at OWNER's Seadrift, Texas facility.

1.10  "Project Completion" means Final Acceptance of the Plant has been
achieved.

1.11  "Ready for Commissioning" means the Plant, unit, facility, or part thereof
has been erected in accordance with the drawings, specifications and applicable
codes, to the extent necessary to permit commissioning, and pre-commissioning
activities have been completed by FWUSAC as detailed in Exhibit E.

1.12  "Site" means the land and other places on, under, in or through which the
Plant is to be constructed which includes real property located at the OWNER's
Seadrift, Texas Facility.

1.13  "Specifications" means those portions of the Contract Documents consisting
of written technical descriptions of materials, equipment, construction systems,
standards and workmanship as applied to the Work and certain administrative
details applicable thereto produced by or for FWUSAC in furtherance of the
design, construction, and erection and maintenance of the Plant.

1.14  "Subcontractor" means an individual, firm or corporation having either a
direct contract with FWUSAC or a contract executed by FWUSAC as OWNER's agent,
or any other lower-tier Subcontractor who performs any part of the design or any
part of the Work at the Site.

1.15  "Vendor "means any third party supplying any Equipment or Construction
Aids to FWUSAC with or without the services of supervision of installation at
the Site, but without installation labor at the Site.

1.16  "Work" means the entire completed construction of the Plant or the various
separately identifiable parts thereof required to be furnished under the
Contract Documents and is the result of performing services, furnishing labor
and furnishing and incorporating materials and Equipment into the Plant all as
required by the Contract Documents.

1.17  "Mechanical Completion Date" shall mean the date of completion of erection
of the respective unit or section of the Plant, exclusive of insulation and
painting.

1.18  "Work in Progress" shall mean all portions of the Work and all equipment,
supplies, and materials to be incorporated into the Work, or intended or
earmarked for the Project, while in transit to the Site or while stored in and
off the Site.

1.19  "Mechanical Acceptance" has the meaning defined in Subarticle 14.1.

1.20  "Final Acceptance" has the meaning defined in Subarticle 14.2.

1.21  "FWCI" shall mean Foster Wheeler Constructors, Inc., which is FWUSAC's
construction subcontractor.

                                       5
<PAGE>
 
2.0  SERVICES BY FWUSAC

     FWUSAC shall exercise all reasonable skill, care and diligence in the
     performance of the WORK under the Agreement and shall carry out all his
     responsibilities in accordance with recognized professional standards in
     the United States of America. FWUSAC shall in accordance with the
     provisions of this Agreement perform the following services as required for
     construction of the Plant, as defined in Exhibit A:
      
     2.1  Furnish home office engineering services consisting of process and
          equipment engineering, mechanical design, procurement and general
          engineering services as, and to the extent, required for construction
          of the Plant to be performed by FWUSAC, including the placement of the
          subcontract for construction to FWCI

          .  FWUSAC procurement services shall include equipment inquiries, bid
          evaluations and inspection services to the extent approved by OWNER.

          2.1.1  Under FWUSAC's construction subcontract to FWCI, FWCI shall be
                 responsible for providing the required construction management
                 and supervisory personnel, craft personnel on a direct hire
                 basis, subcontract services as required, small tools,
                 construction equipment, construction procedures, and
                 construction of the Plant.

     2.2  Inspect all Equipment required for the Plant to the extent FWUSAC 
          deems necessary,

     2.3  Furnish required supervisory construction personnel and other required
          personnel including construction subcontract services; Construction
          Aids, small tools, construction equipment and the like, not furnished
          by construction subcontractors; and construct the Plant.

     2.4  Prior to Ready for Commissioning, supply OWNER with:

          a)    The final tracings, and electronic file copies prepared by 
                FWUSAC for the Plant.

          b)    Five (5) sets of Mechanical Catalogs containing bulletins,
                information and data furnished by Vendors; key drawings and data
                prepared by FWUSAC, all and to the extent set forth in attached
                Engineering Standard of Exhibit A .

          c)    Five (5) sets of Process Technical Specifications.

     2.5  Obtain all license and permits required to be obtained in FWUSAC's 
          name for performance of the Work.

     2.6  Nothing in this Agreement shall operate to prevent FWUSAC carrying out
          similar WORK for other clients.

     2.7  Appoint one or more individuals who shall be authorized to act on
          behalf of FWUSAC and with whom OWNER may consult at all reasonable
          times, and whose instructions, requests, and decisions will be binding
          upon FWUSAC as to all matters pertaining to the Services to be
          rendered under this Agreement as defined below.


                                       6
<PAGE>
 
3.0 SERVICES BY OWNER

OWNER shall perform the following services in connection with the work, without
cost to FWUSAC:

     3.1  Provide all necessary basic design data and any other engineering
          services except as otherwise provided herein. This shall include, but
          not be limited to, necessary soil bearing data and foundation design
          criteria, topographical surveys, benchmarks for design and
          construction, and identification of any hazardous, latent, hidden or
          other conditions not discoverable by visual inspection (walk-through)
          of the property at grade level.
           
     3.2  Procure all necessary permits, licenses, easements, rights of way, and
          a clear and level site free of any above and below grade obstructions,
          other than those obstructions identified on Owner's drawings of the
          Site, provided to FWUSAC in the course of performing the Work as
          required for construction and operation of the Plant other than the
          permits and licenses to be obtained by FWUSAC pursuant to Article 2.

     3.3  Issue all purchase orders in OWNER's name for all Equipment and
          materials to be incorporated into the plant, based on requisitions and
          / or bills of materials prepared by FWUSAC and / or FWCI. Procure all
          necessary know-how, engineering agreements and patent licenses
          required for the Plant other than those to be obtained by FWUSAC
          pursuant to Article 2.

     3.4  Provide a clear, well-drained, fenced and policed security area for a
          Construction Storage area, unloading area, and piping fabrication
          area.

     3.5  Provide a clear and well-drained Construction Parking area.

     3.6  Provide a finished surface road from the construction parking area to
          the main work road.

     3.7  Grade and maintain the construction road and access roads to the Work
          site within the OWNER's property.

     3.8  Furnish, consistent with FWUSAC's construction schedule the completely
          furnished and equipped existing building for (a) the control room
          wherein FWUSAC shall install the instrumentation and interconnections
          thereto for the instrumentation of the Plant; and (b) the existing
          electrical control room wherein FWUSAC shall, receive the 5 kV and 480
          kV power and install the electrical switch gear and motor control
          centers and the interconnections thereof required for the Plant.

     3.9  Provide, in a safe and ready for service condition, all new, and /or
          modified existing equipment, piping and materials of OWNER and its
          subcontractors and vendors to which FWUSAC must tie-in, or provide
          interface connections, or incorporate in the Plant, in the performance
          of FWUSAC's Work, including that performed by FWUSAC's Subcontractors.

     3.10 Provide clear access to the Battery Limits, all temporary facilities
          as required for construction of the Plant, and provide a location for
          disposal of waste material.


                                       7
<PAGE>
 
     3.11  Furnish and install all fire-fighting equipment and piping and
           controls for same. Furnish all Utilities and other materials at the
           battery limits of the Plant at quantities and conditions as required
           for construction and testing purposes, including any necessary fill
           or dirt, compressed air, petroleum feedstocks, coke, natural gas,
           fuel oil, electricity, testing water and potable water, and
           telecommunication connections.

     3.12  Furnish all tools, record sheets, log tables, laboratory and testing
           facilities, instrument charts, spare parts, catalysts, chemicals,
           solvents, feedstocks and any other consumable supplies for
           maintenance and operation, including testing of the Plant.

     3.13  OWNER shall assume care, custody and control of the Plant and parts
           thereof after they are Ready for Commissioning. Thereafter, in
           association with FWUSAC and its Subcontractors, and in accordance
           with Exhibit D hereof, OWNER will provide all maintenance, labor,
           materials and utilities necessary to maintain, operate and test the
           Plant, and any unit, or parts thereof. Furnish all labor, including
           standby labor during start-up; and materials and utilities required
           for maintenance and operation of the Plant from the date of Ready
           for Commissioning.

     3.14  OWNER shall provide such approvals as are required under the terms of
           this Agreement in such reasonable time as not to delay or disrupt the
           performance of the WORK.

     3.15  OWNER shall negotiate and obtain at its cost all necessary licenses
           or other approvals that may be required in respect of the WORK from
           the relevant Government and other Authorities, which are not
           required to be obtained by FWUSAC under Article 2.6 above.

     3.16  Appoint one or more individuals who shall be authorized to act on
           behalf of OWNER, with whom FWUSAC may consult at all reasonable
           times, and whose instructions, requests, and decisions will be
           binding upon OWNER as to all matters pertaining to this Agreement and
           to the performance of the parties hereunder.

4.0  PRICE

     4.1   OWNER agrees to pay FWUSAC in the manner, and as designated in
           Article 5.0 hereof as full and complete compensation for FWUSAC's
           services under this Agreement, the sum of the following amounts;
           all the costs and charges incurred in performance of the Work,
           including but not limited to the costs of engineering services,
           procurement services, funding of Equipment (if required), and
           construction of the Plant in accordance with Exhibit B.

     4.2   FWUSAC's rates and prices are exclusive of any taxes, duties and/or
           levies whatsoever which may be or become payable outside the United
           States in respect of the WORK or in connection therewith (such as,
           but not limited to, corporate or personal income tax, withholding
           tax, and any and all sales, export, import, VAT, and other similar
           taxes and duties).

                                       8
<PAGE>
 
5.0  TERMS OF PAYMENT

     5.1   The amounts payable to FWUSAC pursuant to Subsection 4.1, as
           adjusted, shall be due and payable in accordance with the basis
           set forth in Exhibit B, including all reimbursable costs and fees
           earned for Work performed during the previous month and chargeable to
           OWNER under this Agreement, upon OWNER's receipt of FWUSAC's monthly
           invoices therefor. Provided however, Invoices for field construction
           labor shall be submitted on a weekly basis, and paid by OWNER on a
           weekly basis though a zero balance account. Charges for home office
           personnel and salaried personnel on the site will be invoiced on a
           monthly basis. All payments shall be made, within 30 days of receipt
           of invoice by OWNER and shall be made in US Dollars to FWUSAC's
           designated bank in New Jersey. The invoice shall be accompanied by
           itemization of all items of reimbursable costs, and other documents
           to support invoices. Payment by OWNER to vendors and subcontractors
           for purchase orders and subcontracts shall be in accordance with
           their respective terms and approved by FWUSAC as being in conformity
           therewith.

     5.2   OWNER agrees that payments due to FWUSAC shall be paid in full,
           free of any withholdings.


6.0  RELATIONSHIP OF THE PARTIES

     6.1   For purposes of this Agreement and all services to be provided
           hereunder, FWUSAC shall be considered an independent contractor.

     6.2   Neither FWUSAC nor any subcontractor, nor the employees of either
           shall be deemed to be the servants, employees, or otherwise the
           agents of OWNER and is without power of authority to act on behalf
           of OWNER to incur any liability on OWNER's account.


7.0  PRICE ADJUSTMENT

        The Price specified in Subarticle 4.1 shall be adjusted as a change in
        the Work, for the following causes:

     7.1   Increases in the design capacity of the Plant by the addition of
           and/or replacement of any major items of Equipment specified in the
           attached Exhibit A.

     7.2   Changes by OWNER to the design set forth in Exhibit A. 

     7.3   In the event OWNER requires the purchase of equipment other than
           Equipment selected by FWUSAC.

     7.4   Overtime work in FWUSAC's home or branch offices or at the job
           site, including payroll taxes and insurance premiums computed on such
           premiums; provided such overtime is undertaken by FWUSAC with
           OWNER's written authorization.

     7.5   Costs and charges resulting from a decrease in the length of the
           work week required by law or area practices which become effective
           after the effective date of this Agreement.


                                       9
<PAGE>
 
     7.6   Alterations in, additions to, or deletions from the Plant which are
           requested by OWNER or required by the OWNER's Insurance Carriers, or
           soil bearing data, foundation and earthwork or other design criteria
           being at variance with that contained in Exhibit A.

     7.7   Increases or decreases in the costs and charges to FWUSAC resulting
           from any change in OWNER's safety or loss-prevention procedures.

     7.8   Interferences with continuous prosecution of the Work or from
           suspension of the Work by OWNER or Force Majeure causes except
           strikes or other concerted acts of workmen or disputes with workmen.

     7.9   Costs and charges for changes in the Work as set forth in the
           Agreement but not above specified.


8.0     CHANGES IN THE WORK

     8.1   OWNER shall have the right at any time prior to Mechanical
           Acceptance of the Plant, to request alterations in, additions to or
           deletions from the Work. In each case, FWUSAC shall promptly
           prepare and submit to OWNER a detailed estimate of the net effect
           of such change on the Contract Price, and on the reimbursable costs
           set forth in Article 4 hereof and including the cost of preparation
           of the estimate whether on a lump sum, time and material, or
           reimbursable rate basis. Upon approval of the estimate by OWNER, the 
           said Contract Price shall be adjusted by the amounts set forth in
           such estimate.

           In the event that OWNER elects not to have the change effected
           after FWUSAC's preparation of the estimate as set forth herein,
           OWNER shall pay to FWUSAC the costs and charges occurred in
           preparation of the estimate.

     8.2   In the event any changes in laws, rules, regulations, (including
           taxes) applicable FWUSAC's performance of the Work, occur after the
           effective date of this Agreement, such changes shall result in a
           Change in the Work for the benefit of FWUSAC.

     8.3   In the event Changes in the Work affect FWUSAC's guarantees
           hereunder and OWNER requires FWUSAC to implement such Changes,
           FWUSAC's guarantee shall be modified accordingly.

     8.4   If a Change in the Work causes a revision in the time required for
           achieving Mechanical Completion of the Plant, the contemplated date
           of completion shall be accordingly adjusted.

9.0     TIME OF PERFORMANCE

        FWUSAC shall promptly commence the Work and with its best efforts, and
        endeavor to attain Mechanical Completion of the Plant on or about
                        , 1998. If FWUSA fails to meet the mutually agreed upon
        ------------- --
        Mechanical Completion Date, the sole remedy of the Owner and the sole
        liability of FWUSAC, shall be that OWNER shall retain, and FWUSAC shall
        forego receipt, of the schedule component of the at-risk fee associated
        the achievement of agreed upon the Mechanical Completion Date.

                                      10
<PAGE>
 
10.0 INSURANCE

     10.1  FWUSAC shall obtain and maintain during the performance of the Work
           hereunder the following insurance:

           10.1.1 Workmen's Compensation Insurance and Employer's Liability
                  Insurance in accordance with the laws of the state in which
                  FWUSAC may be required to pay compensation, with limits for
                  Employer's Liability of $1,000,000 per accident or diseases,
                  aggregate as to disease.

           10.1.2 Commercial General Liability including Contractual Liability,
                  Products, Completed Operations, covering claims for bodily
                  injury, including death, and damage to property, with
                  combined single limits of $1,000,000 for bodily injury and
                  property damage per occurrence /aggregate.

           10.1.3 Automobile Liability Insurance with a combined single limit
                  for bodily injury and property damage of $1,000,000.

           10.1.4 Excess Liability Insurance, in excess of the coverages under
                  Articles 10.1.2 and 10.1.3, which in combination with the
                  coverages under Articles 10.1.2 and 10.1.3 shall have a
                  combined single limit of US $5.000,000 per occurrence
                  /aggregate.

     10.2  OWNER shall obtain and maintain during the performance of the Work
           hereunder the following insurance:

           10.2.1 Builder's All-Risk Insurance including inland transportation
                  covering all Equipment, material, machinery, and structures
                  intended to become a permanent part of the Plant and temporary
                  facilities used in or incidental to performance of the
                  Work, while in transit to the Job Site, awaiting and during
                  erection, and until Final Acceptance, shall be maintained by
                  the OWNER, with a deductible of (One-Hundred Thousand Dollars)
                  $100,000. FWUSAC shall be responsible for the deductible of
                  $100,000 under the OWNER's Builder's All-Risk Insurance for
                  claims due to the negligence of FWUSAC and its subcontractor,
                  Foster Wheeler Constructors, Inc. OWNER will waive its
                  insurer's rights of subrogation under this policy.

     10.3  The insurance to be provided pursuant to Subarticle 10.1 and
           Subarticle 10.2 shall be subject to the normal limitations and
           exclusions applying to each type of policy of insurance. All
           insurance to be carried pursuant to this Article 10.0 shall be
           endorsed to require the insurer to furnish FWUSAC and OWNER with
           thirty (30) days' written notice prior to the effective date of any 
           modification or cancellation of such insurance.

     10.4  FWUSAC shall furnish OWNER with certificates showing that the
           insurance policies to be carried by FWUSAC in accordance with
           Subarticle 10.1 have been issued. FWUSAC shall reinstate the
           aggregate of its Commercial General Liability or Excess Liability
           policy in the event the required limits of (Five Million Dollars)
           $5,000,000 per occurrence/ aggregate are impaired by losses not
           relating to this Agreement, during the term of this Agreement.



                                      11
<PAGE>
 
11.0 INDEMNIFICATION FOR BODILY INJURIES AND PROPERTY DAMAGES

     11.1  FWUSAC shall hold harmless and indemnify OWNER against any claims
           for bodily injury (including death) to employees of OWNER, FWUSAC,
           and its subcontractors, and for damage to or loss of property of
           OWNER, occurring or sustained during performance of the Work
           hereunder, and to the extent caused by the negligent acts or
           omissions of FWUSAC, and its Subcontractors in the performance of
           the Work, provided FWUSAC's and its Subcontractor's liability for
           damage to the property of OWNER shall be limited to the aggregate
           total of amount of U.S. $100,000.

     11.2  OWNER does hereby release and agrees to hold harmless and indemnify
           FWUSAC and its Subcontractors from any claim, loss or liability
           resulting from damage to the Plant, and for damage to other property
           of OWNER and the property of OWNER'S personnel, in excess of the
           aggregate total amount of $100,000. OWNER shall obtain from its
           Business Interruption, Extra Expense and Property Damage insurers a
           Waiver of Subrogation in favor of FWUSAC and its Subcontractors and
           their respective affiliates for loss or damage to OWNER's property
           in excess of the aggregate total amount of U.S. $100,000.

     11.3  OWNER shall indemnify and hold harmless FWUSAC and its
           subcontractors from and against any and all liability for death,
           illness or injury to any third party or for loss or damage to any
           third party's property and against all claims, demands, proceedings
           and causes of action resulting from FWUSAC'S performance of Work
           under this Agreement, except to the extent such third party claim
           is caused by the negligence of FWUSAC.

12.0  TITLE AND RISK OF LOSS TO MATERIALS & EQUIPMENT

     12.1  Title and Risk of Loss to all Equipment and Materials shall pass to
           OWNER as and when title and Risk of Loss passes from the Vendor or
           Supplier.

13.0 RECORDS & ACCOUNTING

     13.1  FWUSAC shall keep full and detailed accounts and records in
           accordance with its established accounting procedures.

     13.2  FWUSAC shall permit OWNER to have access to and review and audit at
           all reasonable time its records and accounts relating to any costs
           reimbursable, to FWUSAC by OWNER, pursuant to this Agreement,
           provided however, OWNER's audit rights shall not apply to
           CONTRACTOR's fixed rates, overlays, multipliers, fixed mark-up
           rates, and fixed percentage charges, fixed amounts, or lumpsum
           amounts, such as but not limited to benefits, bond rates, tools,
           insurance, overhead, and fee for profit. Such periodic reviews and
           audits shall be made during the performance of the Work; final audits
           shall be made within twelve (12) months after the Completion of the
           Work.

14.0 MECHANICAL ACCEPTANCE; COMPLETION OF THE WORK

     14.1  Upon completion of the erection of the Plant, or any part thereof
           capable of being isolated by temporary physical boundaries from
           uncompleted parts of the Plant and consisting of equipment and
           facilities which can be properly and safely commissioned
           independently from uncompleted parts of the Plant, except insulation
           and painting, and upon completion of pre-commissioning work as
           specified in attached Exhibit D [Plant Completion Standard 05A1],
           FWUSAC shall give

                                      12
<PAGE>
 
           OWNER written notice that the Plant or part thereof as herein defined
           is Ready for Commissioning. Within five working days after the
           receipt of said notice, OWNER shall give FWUSAC a letter of
           Mechanical Acceptance or shall notify FWUSAC in writing of any items
           requiring completion, correction or repair. Upon completion,
           correction or repair of every item about which OWNER has notified
           FWUSAC, FWUSAC shall give OWNER written notice of such completion,
           correction or repair, and within five working days after receipt of
           said notice, OWNER shall give FWUSAC the letter of Mechanical
           Acceptance, or shall notify FWUSAC in writing of all items requiring
           completion, correction or repair. The notification procedure shall
           be repeated until OWNER issues the letter of Mechanical Acceptance.
           If OWNER does not comply with the provisions of the preceding
           notification procedure, OWNER shall be deemed to have Mechanically
           Accepted the Plant, or part thereof, covered by said FWUSAC notice
           as of the fifth working day after the receipt of said FWUSAC notice.
           After Mechanical Acceptance, OWNER may start commissioning the Plant
           or part thereof.

     14.2  After Mechanical Acceptance, FWUSAC shall complete the painting and
           insulation work and perform final clean-up of the Plant or part
           thereof as heretofore defined. After completion of all painting,
           all insulation work and final clean-up, FWUSAC shall notify OWNER
           in writing that construction is complete. Within five working
           days after the date of receipt of said FWUSAC notice, OWNER shall
           give FWUSAC a letter of Final Acceptance stating that the work has
           been completed and accepted, or shall notify FWUSAC in writing of any
           painting, insulation or clean-up items requiring completion,
           correction or repair. Upon completion, correction or repair of all
           such items about which OWNER has notified FWUSAC, FWUSAC shall give
           OWNER written notice of such completion, correction or repair.
           Within five (5) working days after the receipt of said FWUSAC notice,
           OWNER shall give FWUSAC the letter of Final Acceptance stating that
           the work has been completed and accepted or shall notify FWUSAC
           in writing of any painting, insulation or clean-up items requiring
           completion, correction or repair. The notification procedure shall
           be repeated until OWNER issues the letter of Final Acceptance. If
           OWNER does not comply with the provisions of the preceding
           notification procedure, OWNER shall be deemed to have issued said
           letter of Final Acceptance as of the fifth working day after the
           receipt of said FWUSAC notice. After Final Acceptance, OWNER may
           start operating the Plant or part thereof.

15.0   GUARANTEES & WARRANTIES

     15.1  If any part of the Plant designed by FWUSAC is found to be defective
           in service by reason of FWUSAC's faulty mechanical design within
           twelve (12) months after Mechanical Completion thereof, FWUSAC
           shall, make such changes in the said Plant design as are required to
           correct such deficiencies and OWNER shall reimburse FWUSAC for the
           costs of such correction at the same compensation rates as set forth
           in Exhibit B, exclusive however of any costs of reperforming FWUSAC
           engineering services, which cost of reperformed engineering services
           shall be for the account of FWUSAC.

     15.2  Equipment
           ---------

           On any Equipment or any part thereof furnished hereunder by FWUSAC,
           FWUSAC shall endeavor to obtain from vendors and subcontractors the
           most advantageous guarantees with respect to the Equipment. In all
           cases, except with written contrary authorization from OWNER, FWUSAC
           shall request from vendors and subcontractors, a guarantee period of
           twelve (12) months from date of



                                      13
<PAGE>
 
           completion of their work, or eighteen months from the date of
           shipment of vendor equipment, whichever occurs first. FWUSAC shall
           assist OWNER in enforcing such guarantees, but OWNER shall be
           responsible for the cost or expenses of FWUSAC relating to litigation
           to enforce such guarantees.

     15.3  Field Workmanship

           If within twelve months from the date of Mechanical Acceptance of the
           Plant any part of the Plant pursuant to Section 14.1 is found to be
           defective as a result of faulty field workmanship performed,
           directed or supervised by FWUSAC, or its subcontractor FWCI, FWUSAC
           shall provide, and bear the cost of, supervision, construction
           tools, and craft labor performed by FWUSAC and its subcontractor
           FWCI, to correct such defective workmanship, and the cost of any
           and all Equipment and materials required for such correction will
           be the responsibility of OWNER and paid for by OWNER. FWUSAC shall
           not be responsible for any repairs or replacements made by OWNER or
           by others, without the prior written approval of FWUSAC to OWNER
           for such repair or replacement.

     15.4  FWUSAC's liability for all warranties and guarantees pursuant to
           this Agreement is conditioned upon:

           (a)   Operation of the Plant in accordance with the designs,
                 drawings, specification, instructions, safety procedures, and
                 other information and data furnished by FWUSAC hereunder.

           (b)   OWNER giving FWUSAC prompt written notice upon discovery of
                 each and every defect.

           Defects caused by normal corrosion, erosion, wear and tear, changes
           or repairs not authorized by FWUSAC in writing, faulty or improper
           maintenance or abnormal operating conditions or operating at
           conditions more severe than design criteria are excluded.


15.5   THE REMEDIES AND WARRANTIES SET FORTH IN THIS CONTRACT ARE GIVEN IN LIEU
       OF ALL OTHER WARRANTIES AND GUARANTEES, EXCEPT THAT OF TITLE, AND SHALL
       APPLY ON AN EXCLUSIVE BASIS. FWUSAC EXPRESSLY DISCLAIMS ANY OTHER
       WARRANTIES OR GUARANTEES ON THE REMEDIES AND WORK, EXPRESS OR IMPLIED
       WHETHER WRITTEN OR ORAL OR IMPLIED IN THE FACT OR IN LAW, AND WHETHER
       OR NOT BASED ON STATUTE, CONTRACT, TORT, NEGLIGENCE, STRICT LIABILITY
       OR OTHERWISE, INCLUDING BUT NOT LIMITED TO, ANY WARRANTIES OF
       MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, OR ANY WARRANTY
       ARISING FROM COURSE OF DEALING OR USAGE OF TRADE. TO THE EXTENT THAT ANY
       IMPLIED WARRANTIES MAY NOT BE DISCLAIMED UNDER THE APPLICABLE LAW, SUCH
       WARRANTIES ARE EXPRESSLY LIMITED TO THE DURATION OF THE WARRANTY PERIODS
       STATED IN THIS ARTICLE 15. WHERE A REMEDY IS NOT PROVIDED IN THIS
       AGREEMENT, THE PARTIES WILL HAVE THE RIGHTS AND REMEDIES AVAILABLE AT LAW
       OR EQUITY.


                                      14
<PAGE>
 
     15.6  FWUSAC shall not be liable for any defects in the Work to the extent
           that they arise from inaccuracy of any information, and/or data
           provided by, or on behalf of, OWNER to FWUSAC.
           
     15.7  FWUSAC's cumulative overall liability to OWNER for entering into this
           Agreement, whether under the provisions of the Agreement, contract,
           statute, strict liability, tort (including negligence) or otherwise
           at law, shall not exceed the amount paid by OWNER to FWUSAC
           hereunder. FWUSAC, and its subcontractor FWCI, shall be released from
           all liability for occurrences after the expiration of the warranty
           period stated above.

16.0 INDEMNIFICATION AGAINST PATENT INFRINGEMENT

     16.1  FWUSAC shall hold OWNER harmless from, and shall defend at its own
           expense any suit instituted against OWNER because of OWNER's use of
           any of FWUSAC's process designs or apparatus or Equipment specially
           designed by FWUSAC, provided that:

           16.1.1 the equipment has been operated in accordance with FWUSAC's
                  design specifications, drawing, and instructions; 

           16.1.2 suit is based upon a charge of infringement of a claim of any
                  patent granted prior to the effective date of this Agreement;

           16.1.3 OWNER promptly notified FWUSAC in writing of any institution 
                  of such suit or of any warning or claim of infringement;

           16.1.4 OWNER complies with all reasonable requests for assistance 
                  made by FWUSAC.

           Subject to the limits of the provisions of Section 16.3 FWUSAC shall
           pay judgment and court costs awarded against OWNER in such suit and
           all compensation and expenses of FWUSAC's own counsel and experts.
           OWNER may be represented by counsel of OWNER's selection at OWNER's
           expense. Upon receiving such notice from OWNER or from third persons,
           FWUSAC shall have the right to procure for OWNER at FWUSAC's expense
           the right to continue using said process of Equipment, or in the
           alternative, to replace said Equipment or process with a non-
           infringing Equipment or process or to modify said process or
           Equipment to the extent required to avoid infringement, provided such
           replacement or modification does not adversely affect the ability of
           the Plant to meet the guarantees set forth in this Agreement.

     16.2  In connection with any Equipment purchased by OWNER for incorporation
           into the Plant, OWNER shall obtain from Vendors and Subcontractors 
           protection against patent infringement to the extent as may be
           reasonably obtainable.

     16.3  FWUSAC's liability to OWNER for patent infringement is solely limited
           to that stated in Sections 16.1 and monetary limits in the amount of 
           the purchase price of said Equipment designed and manufactured by
           FWUSAC.
 
     16.4  If OWNER select or licenses any process carried out by materials
           including Equipment, apparatus and accessories or combinations
           thereof included in the Work, or if OWNER supplies information
           pursuant to this Agreement, and if as a


                                      15
<PAGE>
 
            result of the foregoing valid patents held by a third party are 
            infringed or claimed to be infringed, OWNER shall hold FWUSAC 
            harmless from any infringement, or any claim of infringement, of 
            such patents, provided that FWUSAC:

            16.4.1      Promptly transmits to OWNER all papers received by 
                        FWUSAC regarding possible infringement or served upon
                        FWUSAC in any suit alleging infringement; and
      
            16.4.2      Permits OWNER to take complete charge of the defense
                        of such suit; and
      
            16.4.3      Complies with all reasonable requests for assistance
                        made by OWNER

17.0  INDUSTRIAL PROPERTY RIGHTS
      
      17.1  Title to all Contract Documents including but not limited to all 
            drawings, bills of material, flow diagrams, specifications, designs,
            information and data and Contract Document prepared by FWUSAC
            hereunder shall remain the property of FWUSAC. OWNER or its assigns
            pursuant to Article 22.0 shall have the right to use the information
            furnished it by FWUSAC solely for construction, reconstruction or
            replacement in kind, operation, repair and maintenance, of the
            Plant, and shall not disclose it to others except to the extent
            necessary to accomplish the foregoing and provided the recipient
            executes a confidentiality agreement in form and substance as set
            forth in Section 17.2

      17.2  OWNER agrees to hold in confidence any and all information 
            disclosed, directly or indirectly, to OWNER by FWUSAC or its
            affiliates under this Agreement. OWNER shall not willfully disclose
            any such information. Such obligation shall not apply to:

            (a)   information which at the time of disclosure is in the public 
                  domain;

            (b)   information which after disclosure is published or otherwise
                  becomes part of the public domain through no fault of OWNER
                  (but only after, and only to the extent that, it is published
                  or otherwise becomes part of the public domain);

            (c)   information which OWNER can show was in its possession at the
                  time of disclosure and was not acquired, directly or 
                  indirectly, from FWUSAC or its affiliates or from a third
                  party under an obligation of confidence; and

            (d)   information which OWNER can show was received by it after the
                  time of disclosure hereunder from a third party who did not
                  require OWNER to hold it in confidence and who did not acquire
                  it, directly or indirectly, from FWUSAC or its affiliates
                  under an obligation of confidence.

17.3  For the purpose of the provisions of Section 17.2 disclosures made to 
      OWNER under this Agreement which are specific, e.g., as to engineering and
      design practices and techniques, equipment, products, operating conditions
      and/or catalyst for treating specific feedstock, etc. shall not be deemed
      to be within the foregoing exceptions merely because they are embraced by
      general disclosures in the public domain or in the possession of OWNER. In
      addition, any combination of features shall not be deemed to be within the
      foregoing exceptions merely because individual features are in the public
      domain or in the possession.



                                      16
<PAGE>
 
 
     of OWNER, but only if the combination itself and its principle of 
     operation are in the public domain or in the possession of OWNER.

17.4 OWNER agrees to promptly disclose to FWUSAC any inventories or improvements
     which are conceived by any of OWNER's employees within a period of ten (10)
     years from date of Final Acceptance of the Plant, which inventions or
     improvements are based upon or derived from FWUSAC information required to
     be maintained in confidence by OWNER pursuant to Section 17.2 hereof, and
     OWNER agrees to grant and hereby grants to FWUSAC a non-exclusive
     worldwide, irrevocable, royalty-free license, including the right to
     sublicense others, under any and all such inventions and improvements,
     whether patentable or not, which are based on or derived from such FWUSAC
     information.

17.5 In the event OWNER desires to file a patent application on any invention or
     improvement in which any technical information furnished by FWUSAC is to be
     disclosed, OWNER agrees to provide FWUSAC prior to filing, with a copy of
     that part of the application which contains such information. If FWUSAC
     advises OWNER that the technical information included in the application is
     information to be held in confidence by OWNER under Section 17.2 hereof and
     OWNER is unable to prove otherwise to the reasonable satisfaction of
     FWUSAC, OWNER agrees not to permit the publication in any country of a
     patent based on such application; FWUSAC agrees, however, that such consent
     shall not be unreasonably withheld.

18.0 LIEN INDEMNIFICATION

     FWUSAC shall indemnify and save OWNER harmless from and against all claims,
     liens, attachments or charges, in the nature of mechanics or materialmen's
     liens, in favor of FWUSAC or any party performing services pursuant to this
     Agreement, payments to whom will be processed through or made by FWUSAC,
     provided OWNER (a) has paid FWUSAC all amounts then due and payable in
     accordance with this Agreement and (b) notifies FWUSAC promptly of any
     claim, lien attachment or charge of which it receives notice and (c)
     permits FWUSAC to defend any such claim, lien, attachment or charge, or
     post bond.

     In the event FWUSAC fails to discharge it s obligations within this
     paragraph OWNER may interplead any disputed funds in its possession into
     the registry of the appropriate state court in Calhoun County, Texas and
     shall be indemnified and held harmless from and against any liability,
     claim, demand, costs and expenses, including attorney fees and litigation
     costs relating to any claim or liens for labor performed or material
     furnished or relating to any security interest or any other kind of lien,
     charge or encumbrance arising directly or indirectly out of or in
     connection with the Work.

19.0 CONTINUOUS PROSECUTION OF THE WORK

     This Agreement contemplates continuous prosecution of the Work and all
     additional costs and charges incurred by FWUSAC resulting from
     interferences beyond FWUSAC's control or resulting from any Force Majeure
     causes shall be paid to FWUSAC by OWNER as a Change in the Work pursuant to
     Article 8.0 hereof.







                                      17
<PAGE>
 
20.0 FORCE MAJEURE

     Any delay in or failure of performance by FWUSAC shall not constitute
     default hereunder as and to the extent such delay or failure is caused by
     an occurrence beyond the control of FWUSAC, including: acts of God or the
     public enemy; expropriation or confiscation of facilities; compliance with
     any order of any governmental authority; acts of war, rebellion or sabotage
     or damage resulting therefrom; fires; floods; explosions; accidents; riots;
     strikes or other concerted acts of workmen or disputes with workmen; or any
     occurrence, whether or not of the same class or kind as those specifically
     above mentioned, which is not within the control of FWUSAC, and which by
     the exercise of reasonable diligence, FWUSAC is unable to prevent.

21.0 CONSEQUENTIAL DAMAGES        
    
     21.1  Each party hereto, does hereby release the other party hereto, and
           such other party's respective Subcontractors and their respective
           affiliates, of liability for any and all consequential, special,
           incidental, and indirect damages such as, but not limited to, loss of
           anticipated profits or revenue, loss of use of revenue, cost of
           capital, extra cost or increased cost of production, cost of
           replacement production, failure to achieve, or delay in achieving
           anticipated profits, or other damages of any nature sustained in
           connection with or as a result of the Work to be performed hereunder,
           whether based upon contract, tort, negligence, strict liability or
           otherwise.

     21.2  For any such loss or damages within the contemplation of Section
           21.1, each party shall obtain a Waiver of Subrogation rights of its
           Business Interruption, Extra Expense and Property Damage insurers in
           favor of other party hereto, and such other party's respective
           Subcontractors and their respective affiliates.

22.0 ASSIGNMENT OF AGREEMENT

     22.1  The Agreement shall not be assigned by either party without the prior
           written consent of the other party hereto, except that it may be
           assigned without such consent to the successor of either party or to
           a person, firm or corporation acquiring all, or substantially all, of
           the business and assets of such party and except that OWNER hereby
           agrees that FWUSAC may assign in whole or in part, any of FWUSAC's
           rights and obligations under the Agreement to any affiliates or
           subsidiaries of Foster Wheeler Corporation. No assignment of the
           Agreement shall be valid until and unless the potential assignee
           shall agree to assume it. When duly assigned in accordance with the
           foregoing, the Agreement shall be binding upon, and shall inure to
           the benefit of, the assignee.

23. SUBCONTRACTING

    FWUSAC may subcontract any portions of the Work which in FWUSAC's opinion
    may be subcontracted to the advantage of the Work, including the subcontract
    to FWCI for the construction portion of the Work. Such subcontracting shall
    not relieve FWUSAC of any of its obligations or warranties under this
    Agreement.



                                      18

<PAGE>
 
24.0 WAIVER

     The failure of either party to enforce at any time any of the provisions of
     this Agreement or any rights in respect thereto, or to exercise an election
     herein provided, shall in no way be considered a waiver of such provisions,
     rights, or election or in any way affect the validity of this Agreement.

25.0 NOTICES

     Any written notices hereunder may be given by either party, either by
     personal delivery (delivery by Express Mail, or by courier such as DHL, or
     Federal Express, shall be considered personal delivery) or by facsimile
     addressed to the other party at the address specified below or to such
     other address as may be specified in writing from time to time. The
     effective date of such notices shall be the date of receipt.

     In the case of OWNER:-

           SEADRIFT COKE, L.P.
           An Affiliate of the Carbide/Graphite Group. Inc.
           P.O. Box 192
           Port Lavaca, Texas 77979
           Facsimile 1 512 552 8327
           For the attention of: Mr. Jim Trigg, General Manager

     In the case of FWUSAC:-

           Foster Wheeler USA Corporation,
           Perryville Corporate Park,
           Clinton, New Jersey 08809-4000,

           Facsimile 1 908 730 5315

           For the attention of Mr. Carl Bartoli, President

26.0 SUSPENSION OF THE WORK

      OWNER may at any time stop the Work or any part thereof by written notice 
      to FWUSAC. Performance shall be resumed by FWUSAC within ten (10) days 
      after the date of resumption fixed in a written notice from OWNER to 
      FWUSAC and all additional costs and charges incurred by FWUSAC resulting 
      from such suspension of the Work or part thereof, shall be paid to FWUSAC
      by OWNER as a Change in the Work pursuant to Article 7.10 hereof.

27.0 TERMINATION OF THE WORK

      27.1  OWNER shall have the right at any time to terminate the Work upon
            thirty (30) days written notice to FWUSAC. FWUSAC shall have the 
            right to terminate the Work or any part thereof in the event that 
            OWNER repeatedly suspends the Work or has suspended the Work or such
            part thereof under Section 26.0 above and OWNER does not within
            thirty (30) days after the date of suspension give written notice
            to FWUSAC to resume performance within such thirty (30) day period.

                                      19
<PAGE>
 
     27.2  In the event of termination of the Work as set forth in Section 27.1 
           above, OWNER shall pay to FWUSAC for amounts invoiced through the
           date of termination, plus those costs and charges incurred through
           orderly termination as follows:

           (a)  The cost of FWUSAC's salaries and wages plus an agreed upon 
                overlay of 100% to cover burdens and overhead, plus

           (b)  All FWUSAC's costs and charges for items identified in the 
                attached Exhibit B, except for costs and charges covered
                in (a) above, plus

           (c)  A termination charge of 10% of the sum of (a) and (b) above

            OWNER shall not be liable to FWUSAC for any consequential or
            indirect damages, such as loss of anticipated profits, loss of use
            of revenue, or other special or incidental damages of any nature on
            account of such termination.

     27.3  FWUSAC agrees, upon payments by OWNER as required in Section 27.2 
           above, to execute and deliver to OWNER all documents, in form
           satisfactory to OWNER and to take all steps necessary to fully vest
           in OWNER the right and benefits of FWUSAC under existing commitments
           to suppliers and others.

28.0 CAPTIONS
     
     Captions and headings of the Articles and other portions of the Agreement
     have been inserted for convenience of reference only and shall not in any
     manner affect the construction, meaning, or effect of anything herein
     contained, nor govern the rights and liabilities of the parties hereto.


29.0 CONTROLLING LAW

     This AGREEMENT shall be construed and interpreted in accordance with the 
     laws of the State of Texas, United States of America.

30.0 SEVERABILITY 

     If any provision of this Agreement is found to be illegal or unenforceable,
     such provision shall be deemed not to be a part of this Agreement, and the
     remaining provisions of this Agreement shall continue in full force and
     effect, but shall be interpreted to give effect to the extent feasible to
     the original written intent of the parties.

31.0 ENTIRETY OF AGREEMENT

     This Agreement together with the Exhibits referred to herein and other 
documents incorporated by reference, constitute the entire understanding between
the parties hereto concerning the Work and services and there are not other 
representations, promises, contracts, guarantees, remedies or warranties 
affecting the Work and services; all previous figures, proposals, 
representations and agreements are hereby superseded and canceled. Any changes, 
alterations or additions to this Agreement shall be in writing, dated subsequent
hereto and signed by duly authorized representatives of the parties. In the 
event of any conflict between this Agreement and any Exhibit, the terms of this 
Agreement shall govern. In the event of any conflict among Exhibits, the Exhibit
of latest date shall govern. The following Exhibits are attached hereto and 
incorporated herein:


                                      20
<PAGE>
 
                EXHIBIT A -              SCOPE OF WORK
                EXHIBIT B -              COMPENSATION BASIS
                EXHIBIT C -              PROJECT SCHEDULE
                EXHIBIT D -              PLANT COMPLETION STANDARD

IN WITNESS where the parties hereto have caused this Agreement to be signed by 
their respective duly authorized representatives.


ACCEPTED AND AGREED:                      ACCEPTED AND AGREED:

SEADRIFT COKE, L.P.                       FOSTER WHEELER USA CORPORATION

By:  /s/ Jim Trigg                        By:  /s/ Gasper P. Tiranno
   ----------------------------              -------------------------------
   General Manager                           General Manager

                                          Executive Vice President
--------------------------------          ----------------------------------
(Title)                                   (Title)


<PAGE>
 
                   [LOGO OF FOSTER WHEELER USA CORPORATION]
 
                        FOSTER WHEELER USA CORPORATION

                              SEADRIFT COKE L.P.
                            FW CONTRACT 13-037624

                           COKER EXPANSION PROJECT



                                                                       EXHIBIT A
                                                                   SCOPE OF WORK
 
<PAGE>
 
                                SCOPE OF WORK
                                -------------

Scope of Services
-----------------

       The scope of FWUSAC services includes provision of engineering, design,
       inspection and construction services for expansion of an existing needle
       coker facility. The scope of services are outlined as follows:

2.1.1  Engineering and Design
       ----------------------

       . Review of Process Flow Diagrams and process design basis for
         establishing requirements for expansion of the plant as established
         by Seadrift Coke

       . Completion of basic process engineering, existing systems interfaces
     
       . Process safety and environmental compliances as defined by Seadrift
         Coke
     
       . Project specifications and standards
     
       . Detailed engineering and design of facilities encompassing areas of:
     
         - Civil/Structural
         - Piping
         - Electrical
         - Instrumentation
         - Equipment

       . Constructibility studies
     
       . Equipment and material requisitions for procurement by Seadrift Coke
     
       . Equipment drawings review for compliance with purchase requisitions
         and project specifications
     
       . Field design and interface with construction management team of FWCI



                                                                       EXHIBIT A
 
                                    Page 1
<PAGE>
 
2.1.2  Procurement Services for Equipment and Materials 
       ------------------------------------------------              
 
       . Standards and specifications
        
       . Development of vendor list for approval

       . Issue of inquiries for equipment and materials as required by Seadrift
         Coke

       . Commercial and technical evaluation of vendor quotations

       . Bid clarification meetings
        
       . Bid tabulations for equipment and material
        
       . Vendor recommendation for purchase by Seadrift Coke

       . Inspection Plan

       . Traffic coordination for delivery of equipment and materials as
         required by Seadrift Coke.

       . Equipment Status reports
 
2.1.3  Project Management
       ------------------
 
       . Project management to insure engineering design and construction
         coordination
 
       . QA/QC Program to insure compliance with engineering practices of
         FWUSAC
 
       . Project control system covering the following areas:
 
         - Engineering
         - Design
         - Vendor Coordination
         - Inspection
         - Construction

         The project control system will cover all aspects of planning,
         scheduling, cost control, progress measurement, and document
         management.

       . Monthly progress and cost reports for services by FWUSAC
 
                                    Page 2
<PAGE>
 
2.1.4  Construction
       ------------
 
       . Constructibility studies
 
       . Construction execution plan
 
       . Detail construction schedule and cost control
 
       . Coordination with project management for engineering and design
         deliverables.
 
       . Staffing of construction management and direct hire labor.
 
       . Early mobilization of field team for interface with engineering
         design.
 
       . Temporary facilities for piping fabrication and construction utilities
         as required to incorporate the work.
 
       . Materials and Equipment warehousing and laydown coordination for
         receipt of equipment and materials purchased directly by Seadrift Coke.
 
       . Field QA/QC program to insure full compliance with safety and proper
         construction procedures.
 
       . Installation of new equipment, foundations, structures, instrument
         controls and electrical distribution as required by design of the
         facility expansion.

       . Modification of existing equipment and facilities as defined by
         Seadrift Coke.
 
       . NDE and testing of equipment and installed material.
 
2.2    List of Deliverables
       --------------------

       FWUSAC documents and drawings deliverables are listed below:

       . Project engineering and management
         - Coordination procedure
         - Project specifications
         - Overall project master schedule - EPC
         - Front-end and detailed schedules
              -  Engineering
              -  Design
              -  Procurement Services
              -  Construction

         - Updated Process Flow Diagrams
         - Heat and Material Balances
         - Design Pressure/Temperature Diagrams
         - Materials of Construction Diagrams
         - Updated P&ID's
 
                                    Page 3
<PAGE>
 
         - Line list for P&ID's
         - Utility summaries
         - Header and utility flow diagrams
         - Effluent summary
         - Flare load summary
         - Relief valve list/design basis/calculations
         - Control valve data sheets and specifications
         - Flow element data sheets
         - Functional description for DCS system
         - Shutdown and interlock sequence logic
         - Requisition Index
         - Equipment List for all new and modified equipment
         - Drawing Index
         - Instrument Index
         - Vendor document Index
         - Specifications Index

       . Equipment engineering - mechanical/electrical/instruments

         - Inquiry requisitions for Mechanical Equipment

           - Towers/drums/tanks
           - S/T Exchangers/Air Coolers
           - Compressors/Pumps
           - Mechanical Package Equipment

         - Electrical equipment requisitions
         - Control Valve and Relief Valve Requisitions
         - Tagged instruments requisitions
         - Certified vendor drawings
         - Mechanical catalogs
         - Spare Parts List

       . Civil/Structural

         - Criteria for foundation/structure/underground and trench designs
         - Design drawings showing plans, elevations, sections, details, MTO,
           and rebar quantities as required for the following:

           - Underground systems
           - Concrete foundations and structures
           - Steel structures
           - Pipe racks
           - Platforms/ladders/circular platforms
           - Electrical/instrument buildings
           - MCC buildings

         - Package equipment 
 
                                    Page 4
<PAGE>
 
       . Piping

         - Piping design schematics
         - Mechanical and material specifications for all piping and valves
         - Requisitions for valves
         - Requisitions for alloy pipe materials
         - Underground piping drawings
         - Key plot plans
         - Equipment location plans
         - Piping plans and sections
         - Piping isometrics for all lines 3/4" and larger
         - Pipe support location plans
         - Fire water piping loop diagram and isometrics
         - Bulk material requisitions

           - Alloy steel piping material
           - Carbon steel piping material
           - Spring hangers and special pipe supports
           - Specialty piping items

         - Steam tracing tabulation with material summaries

       . Instrumentation
         - Instrument location plans
         - Instrument wiring drawings/cable tray layout
         - Instrument installation details
         - Instrument loop diagrams
         - Bulk material requisitions
 
           - Instrument fittings
           - Field instrument cable
           - Junction boxes
           - Installation materials

       . Electrical

         - Electrical load summary
         - One-line diagram
         - Area classification drawing
         - Power/lighting layout drawings
         - Motor control schematics
         - Grounding details drawings
         - Cable and raceway schedules
         - Bulk material requisitions for electrical items
 
                                    Page 5
<PAGE>
 
       . Insulation/fireproofing/steam tracing/painting

         - Insulation requirements including quantities summary
         - Fireproofing requirements for vessel skirts and structures
         - Steam tracing requirements and material summary
         - Painting requirements including quantities summary

 
 
                                    Page 6
<PAGE>
 
                   [LOGO OF FOSTER WHEELER USA CORPORATION]
 
                        FOSTER WHEELER USA CORPORATION
                                        
                              SEADRIFT COKE L.P.
                             FW CONTRACT 13-037624
 

                            COKER EXPANSION PROJECT



                                                                       EXHIBIT B
                                                              COMPENSATION BASIS
<PAGE>
 
                       COMMERCIAL BASIS OF COMPENSATION
                       --------------------------------
                     ENGINEERING AND PROCUREMENT SERVICES
                     ------------------------------------
                                        


SECTION 1
---------

1.1  Basis of Reimbursement
     ----------------------

     1.1.1  Bare Salaries and Mark-Up of Straight-Time Reimbursable Labor

            Foster Wheeler shall be reimbursed for all the time devoted to the
            work by its personnel at the rate of wages and salaries, plus an
            overlay of 75% of bare wages and salaries to cover payroll burdens,
            benefits, and overhead expenses. This rate applies to all
            management, technical, and support personnel of Foster Wheeler USA's
            Houston Engineering Center. The range of bare salary rates and
            salary policies applicable to reimbursable personnel is shown in
            Commercial Appendix 3D.

     1.1.2  Miscellaneous Home Office Expenses

            In addition to the reimbursement of labor, Foster Wheeler shall be
            reimbursed for miscellaneous home office expenses associated with
            the work, such as long-distance communication, technical computer
            applications, reproduction and others, at $6.50 per manhour.

            1.1.3  Travel and Living

            Travel and Living expenses will be reimbursed as follows:

            1.     Actual reasonable expenses incurred for meals, lodging and
                   rental car for Foster Wheeler personnel in travel status
                   away from the office in connection with the project business

            2.     Travel by personal automobile at $0.30 per mile.

            3.     Air travel at economy class fare

     1.1.4  Rental of Site Trailer

            It is understood and agreed that Seadrift Coke, L.P. will provide
            gratis a 14' x 70' trailer on site furnished per Foster Wheeler's
            requirements. Utilities for the trailer will be paid for by Seadrift
            Coke. L.P.
 
                                  Page 1 of 2
<PAGE>
 
                       COMMERCIAL BASIS OF COMPENSATION
                       --------------------------------
                     ENGINEERING AND PROCUREMENT SERVICES
                     ------------------------------------
                                        

     1.1.5  Fixed Fee

            In addition to reimbursement of labor, miscellaneous home office
            expenses, and travel and living expenses, Foster Wheeler will be
            reimbursed a fixed fee of $150,000 for profit.
 
 
     1.1.6  Earned Fee

            In addition to the above, a further $150,000 may be earned based on
            meeting mutually agreed objectives relating to schedule, cost, and
            quality in equal $50,000 portions.


     1.1.7  Shared Cost Underrun

            In addition to the above cost reimbursements, fixed fee, and earned
            fee, Foster Wheeler will share with Seadrift Coke, L.P. on a 50/50
            basis any underrun of the Target Price to be established upon
            completion of the definitive estimate and schedule.
 
 
                                  Page 2 of 2
<PAGE>
 
                                             Commercial Appendix 3D
                                             Rev. 4
                                             February 1997


                  SALARY RATE RANGES - REIMBURSABLE PERSONNEL
                  -------------------------------------------
                        FOSTER WHEELER USA CORPORATION
                        ------------------------------
                          HOUSTON ENGINEERING CENTER
                          --------------------------
 
<TABLE>
<CAPTION>
                                  January 1997
                                  Salary Ranges
Position Classification            U.S. $1/Hour
------------------------------  -----------------
<S>                             <C>     <C> <C>
FLOWSHEET DRAFTING              12.77   -   18.34
DESIGN AND DRAFTING             11.22   -   37.50
PROJECT ENGINEERING             19.58   -   50.41
PROJECT MANAGEMENT              43.04   -   63.09
SPECIALTY ENGINEERING           12.98   -   44.84
ENGINEERING SUPPORT SERVICES    11.00   -   16.39
PROCUREMENT SERVICES            14.51   -   34.13
PROCESS ENGINEERING             19.23   -   42.12
ESTIMATING                      14.32   -   42.86
PROJECT CONTROL                 11.58   -   44.75
DOCUMENT CONTROL                10.93   -   33.55
COMPUTER SERVICES               14.64   -   39.15
WORD PROCESSORS                 12.35   -   15.11
PROJECT ACCOUNTING               8.54   -   30.35
SECRETARIAL & CLERICAL           9.00   -   18.62
SUPERVISORS/CHIEFS/                       
DESIGN ENGINEERS                18.02   -   59.13
DEPARTMENT HEADS                44.71   -   64.85
 
</TABLE>
See applicable notes on tile following page.
<PAGE>
 
                                             Commercial Appendix 3D
                                             Rev. 4
                                             February 1997


                  SALARY RATE RANGES - REIMBURSABLE PERSONNEL
                  -------------------------------------------
                        FOSTER WHEELER USA CORPORATION
                        ------------------------------
                          HOUSTON ENGINEERING CENTER
                          --------------------------

NOTES:
----- 

1.   Salaries and wages are calculated for straight-time only and are exclusive
     of company benefits, payroll burdens, and overhead. Rates are applicable to
     personnel of Foster Wheeler USA Corporation, Houston payroll only.

2.   Hourly rates are calculated on tile basis of 2,080 hours per year, 173 1/3
     hours per month, or 40 hours per week.

3.   The standard workweek is 40 hours per week. In accordance with Foster
     Wheeler's salary policies, overtime is defined as work in excess of eight
     hours a day or forty hours a week, and will be invoiced to the client as
     follows:

     a.   Overtime hours worked by exempt employees shall be invoiced at zero
          percent premium.

     b.   Overtime hours worked by nonexempt employees shall be invoiced at 50
          percent premium.

     c.   Overtime hours worked by Design and Flowsheet Drafting employees shall
          be invoiced at 50 percent premium for overtime work on Monday
          through Saturday, and at 100 percent premium for overtime work on
          Sundays and holidays.

4.   Salary ranges are valid as of January 1997.

5.   Actual salaries reimbursable on a particular contract will vary according
     to personnel assignments. During contract execution, tile actual salaries
     of the personnel assigned may fall outside the ranges shown as a result of
     individual merit increases, promotions, addition of personnel, or economic
     changes. Billings will be made on the basis of actual salaries.
<PAGE>
 
                       COMMERCIAL BASIS OF COMPENSATION
                       --------------------------------
                             CONSTRUCTION SERVICES
                             ---------------------
                                        

                               COMMERCIAL TERMS
                               ----------------
                                      FOR
                                      ---
                    COST REIMBURSABLE CONSTRUCTION SERVICES
                    ---------------------------------------


I.   Introduction
     ------------

     The Contractor shall be compensated for work performed on a cost
     reimbursable basis through the payment of field costs. Wage rates are
     subject to escalation upon mutual agreement between the client and FWCI.

II.  Reimbursable Field Costs
     ------------------------

     The Contractor shall be reimbursed for the following costs at the rates
     specified or, if no rate is specified, at actual cost to the Contractor.

     1.   Field Labor - The Contractor shall be reimbursed for all field payroll
          -----------                                                           
          labor costs of personnel employed on the jobsite such as craft
          supervisor, foremen, craftsmen, helpers, laborers, field clerks,
          technicians, etc.

          Field labor will be reimbursed at actual straight time wages of all
          hours worked plus a mark-up of forty-six (46%) percent to include the
          following items:

          a.   Wages - Including straight time, show-up time and overtime.
               (Premium portion of overtime shall be reimbursed at cost without
               mark-up.)

          b.   Fringe benefits - Covers the cost of medical, life insurance,
               vacation, retirement savings, holiday pay, and administrative
               cost for our benefit program for field hired employees.

          c.   Taxes and insurance - Imposed by federal, state or local
               governmental authorities on field payrolls such as FICA Tax
               (Social Security), federal unemployment insurance, state
               unemployment insurance and workmen's compensation. Also included
               is an allowance to cover liability insurance coverage by FWCI.
 
                                  Page 1 of 3
<PAGE>
 
                       COMMERCIAL BASIS OF COMPENSATION
                       --------------------------------
                             CONSTRUCTION SERVICES
                             ---------------------
                                        

          d.   Small tools and consumables valued under $1000.00.

          The field hire craft labor rates (inclusive of the above) will be
          established through mutual agreement between FWCI and Seadrift for
          this project. Straight time rate is payable for the first forty (40)
          hours in the work week and overtime rate is payable for all hours over
          forty (40) in the work week at a rate of time and one half and all
          company holidays at a rate of double the straight time wage.

 
     2.   Contractor's Salaried Employees - The Contractor shall be reimbursed
          ------------------------------- 
          for all of Contractor's salaried personnel who are employed on the
          project (both home office and field) on the basis of actual salary
          plus sixty-five (65%) percent for all hours worked.

          In addition to the above, Purchaser shall reimburse all travel
          expenses incurred in traveling to and returning from the jobsite (if
          required), and all living expenses (such as local transportation, food
          and lodging) incurred while on assignment at actual cost without mark-
          up in accordance with FWCI's travel and relocation allowance policy
          which is included herein.

     3.   Subcontracts - The Contractor shall be reimbursed for all subcontract
          ------------   
          cost for work or services entered into by the Contractor at the price
          charged to the Contractor by the Subcontractor.

     4.   Capital Tools - The Contractor may provide capital tools owned by the
          -------------                                                        
          Contractor when such capital tools are available and time permits
          their shipment to the jobsite. The Contractor shall be reimbursed for
          such capital tools at the monthly rates and terms specified in the
          attached Capital Tool List and Small Tool List.

          The Contractor shall be reimbursed for all capital tools rented or
          leased by the Contractor from others at the price charged to the
          Contractor.

     5.   Small Tools and Consumables - A listing of typical small tools and
          ---------------------------                                       
          consumables is attached hereto. Small Tools and Consumables are
          included in the base wage mark-up as noted in Section II.1.d.
 
                                  Page 2 of 3
<PAGE>
 
                       COMMERCIAL BASIS OF COMPENSATION
                       --------------------------------
                             CONSTRUCTION SERVICES
                             ---------------------
                                        

     6.   Miscellaneous Field Materials - Miscellaneous field materials are
          ----------------------------- 
          materials required for the work which are not considered as
          consumables under Item II.5 (Small Tools & Consumables) and are not
          provided by the Contractor under Item II.3 (Subcontracts). The
          Contractor shall be reimbursed for all such field materials at the
          price charged to the Contractor.

     7.   Field Office Expenses - Field office expenses are items required for
          ---------------------   
          the operation of the Contractor's field office such as telephone, fax,
          postage, stationary, post office box rental, reproduction, electrical,
          etc. The Contractor shall be reimbursed for all field office expenses
          at the price charged to the Contractor.

     8.   Intangible Items The Contractor shall be reimbursed at actual cost for
          ----------------                                                      
          permits, fees and royalties, and all sales, use, property, gross
          receipts, gross income, excise or other similar taxes which the
          Contractor's may be required to pay.

     9.   Other Field Expenses - The Contractor shall be reimbursed at actual
          --------------------  
          cost for all other field expenses not covered by the above
          reimbursable items.

     10.  Safety Related Costs - The Contractor will be reimbursed for safety
          --------------------                           
          related costs including but not limited to:
 
          A.   Safety Training required by the owner or Federal, State or local
               law.

          B.   Specialized safety equipment including Nomex suits, Scott air
               packs, monitoring equipment, medical examinations, etc.

          Labor costs will be billed at the employers rate plus burdens and
          benefits. All other safety related costs will be billed at actual
          cost.

     11.  Terms of Payment - FWCI has not included in its rates consideration
          ----------------  
          for cost of money associated with payment terms. FWCI mutually agreed
          with Seadrift Coke a payment schedule which minimizes out of pocket
          costs. FWCI will be paid weekly for field labor. Monthly invoicing
          with thirty (30) day payment for home office expenses including
          salaried supervisory costs and third party purchases.
 
                                  Page 3 of 3
<PAGE>
 
                                 CONFIDENTIAL
                                 ------------
                                                                        02/02/97
                        FOSTER WHEELER CONTRUCTORS INC

                                     1997
                REIMBURSABLE BARE SALARIES AND CLASSIFICATIONS
                ----------------------------------------------
                              SALARY RATE RANGES
                              ------------------
<TABLE>
<CAPTION>
===============================================================================================
 COST                                             $/MO    $/MO    $/MO    $/HR    $/HR    $/HR
 CODE  DESCRIPTION                                HIGH    LOW     AVE     HIGH    LOW     AVE
===============================================================================================
<S>    <C>                                       <C>     <C>     <C>     <C>     <C>     <C>
FIELD SUPERVISORY POSITIONS
---------------------------
 8811  CONST MANGR/PROJECT SUPT                  $9,900  $5,000  $7,300  $57.12  $28.85  $42.12
 8812  FIELD & AREA SUPT                         $8,000  $4,800  $5,800  $48.15  $27.69  $33.46
 8831  CONSTRUCTION ENGINEERING                  $7,000  $2,600  $4,500  $40.38  $15.00  $25.96
 8841  PROJECT CONTROL                           $7,500  $2,500  $4,000  $43.27  $14.42  $23.08
 8851  MATERIAL MANAGER                          $6,000  $3,600  $4,600  $34.62  $20.77  $26.54
 8861  GENERAL ADMINISTRATION                    $6,500  $2,000  $4,700  $37.50  $11.54  $27.12
 8862  SAFETY SUPERVISION                        $6,000  $3,500  $4,700  $34.62  $20.19  $27.12
 8871  SUBCONTRACT ADMIN                         $8,500  $3,500  $5,800  $49.04  $20.19  $33.46
 8813  GENERAL CRAFT SUPV                        $6,500  $3,500  $4,900  $37.50  $20.19  $28.27
 8832  QUALITY CONTROL                           $6,500  $4,300  $4,900  $37.50  $24.81  $28.27
 8833  WELD TECHNICIANS                          $5,500  $3,800  $4,900  $31.73  $21.92  $28.27
 
HOME OFFICE POSITIONS
---------------------
 
 8461  ADMINISTRATION                            $9,900  $1,900  $3,280  $57.12  $10.96  $18.92
 8411  CONST DIRS & MANAGERS                     $9,900  $6,900  $7,680  $57.12  $39.81  $44.31
 8431  CONST ENG & QA/QC                         $6,900  $3,900  $5,300  $39.81  $22.50  $30.58
 8441  PROJECT CONTROL                           $7,500  $3,200  $5,500  $43.27  $18.46  $31.73
 8471  SUBCONTRACTS & PURCH.                     $8,500  $1,700  $5,300  $49.04   $9.81  $30.58
 8421  PROPOSALS & ESTIMATING                    $8,500  $2,850  $6,100  $49.04  $16.44  $35.19
 8451  CONST TOOLS & EQUIP NJ                    $6,500  $2,100  $3,900  $37.50  $12.12  $22.50
 8452  CONST TOOLS & EQUlP TX                    $5,600  $1,500  $2,600  $32.31   $8.65  $15.00 
===============================================================================================
</TABLE>
<PAGE>
 
                       COMMERCIAL BASIS OF COMPENSATION
                       --------------------------------
                             CONSTRUCTION SERVICES
                             ---------------------
                                        

            REIMBURSABLE CONSTRUCTION COST WITH AT-RISK PROFIT FEE
            ------------------------------------------------------


Foster Wheeler Constructors, Inc. (FWCI) agrees to perform construction services
for the Seadrift Coke, L.P. Coker Expansion Project located at Port Lavaca,
Texas on a Cost Reimbursable basis with an At-Risk Fee for profit and general
and administrative expenses based on meeting mutually agreed target budget and
project schedule.

FWCI is committed to the use of incentives because of our strong belief that
incentive programs develop team spirit and overall project excellence with an
emphasis on safety.  FWCI is proposing that our profit is entirely at risk and
based upon criteria specified below. FWCI will distribute a twenty (20%) percent
share of its earned incentive as a bonus pool to site project supervision and
labor. Seadrift Coke will also contribute a share of the bonus pool based upon a
savings resulting from an underrun of the target manhours established for the
project. The criteria for this employee distribution is that the individual must
either be reassigned to another FWCI project or receive a reduction in force at
Seadrift Coke. Employees who quit or are terminated for cause are not eligible.
Bonus money to employees is determined by using a formula based on a percentage
applied to the individuals gross wages.

The At-Risk Profit Fee is earned by achieving or surpassing performance targets
set through mutual agreement between Seadrift Coke and FWCI.

The components of the overall profit fee be structured in three parts as
follows:

     1. Budget
        ------

        A construction cost budget for the project will be established by late
        September, 1997 through mutual agreement between FWCI and Seadrift.

        If FWCI completes the project within the set budget, $250,000 will be
        paid to cover general administrative, overhead and profit.

     2. Schedule
        --------

        A construction schedule for the project will be established by late
        September, 1997 through mutual agreement between FWCI and Seadrift

        If FWCI completes the project within the scheduled time period, an
        additional $250,000 will be paid as an additional incentive fee.
 
                                  Page 1 of 2
<PAGE>
 
                       COMMERCIAL BASIS OF COMPENSATION
                       --------------------------------
                             CONSTRUCTION SERVICES
                             ---------------------
                                        

     3. Budget Underrun
        ---------------

        As an incentive to complete the project for less than the established
        cost budget, FWCI and Seadrift will share in the cost underrun.

        If FWCI underruns the budget by more than $250,000, 50% of cost underrun
        greater than $250,000 will be paid to FWCI as additional fee for general
        and administrative expenses and profit.

     4. Manhour Underrun
        ----------------

        Seadrift Coke will contribute to the bonus pool to site project
        supervision and field hired labor $7.00 per hour for each hour. The
        actual hours expended (direct and indirect) are under the mutually
        agreed target.  100% of these savings will be distributed to the above
        employees.

FWCI is proposing this structure as we are confident that we have the
supervisory and craft talent available to execute the project in a highly
satisfactory manner. In addition, we have unique expertise in constructability,
safety, planning, scheduling and cost control. We also feel that by including
all of our personnel into project goals and rewards the project will achieve our
mutual objectives. To this end, we will communicate our joint objectives to our
workforce throughout the project.
 
Attached for your ease in reviewing this incentive plan, is a sample calculation
assuming certain project results.
 
 
                                  Page 2 of 2
<PAGE>
 
                       COMMERCIAL BASIS OF COMPENSATION
                       --------------------------------
                             CONSTRUCTION SERVICES
                             ---------------------
                                        


                      SEADRIFT COKE L.P., SEADRIFT TEXAS

             LABOR RATES TO APPLY TO THE ABOVE REFERENCED PROJECT
 
<TABLE>
<CAPTION>
--------------------------------------------
Classification                      Wage
--------------------------------------------
<S>                              <C>
Craft Supervisor                 19.00-24.00
--------------------------------------------
Foreman                             17.50
--------------------------------------------
Mechanic A - Inst. Tech             16.00
--------------------------------------------
Mechanic A - Comb Welder            15.50
--------------------------------------------
Mechanic A                          15.00
--------------------------------------------
Mechanic B                          14.50
--------------------------------------------
Helper I                            12.00
--------------------------------------------
Helper II                           10.00
--------------------------------------------
Helper III                           8.50
--------------------------------------------
Laborer/Fire Watch/Hole Watch        8.00
--------------------------------------------
Technician                          13.50
--------------------------------------------
Secretary                           10.00
--------------------------------------------
Timekeeper/Clerk                     8.00
--------------------------------------------
</TABLE>
 
The above listed will receive time and half pay for working on approved
holidays.
<PAGE>
 
                       COMMERCIAL BASIS OF COMPENSATION
                       --------------------------------
                             CONSTRUCTION SERVICES
                             ---------------------
                                        



                              SAMPLE CALCULATION
                   INCENTIVE FEE AND BONUS POOL DISTRIBUTION
                   -----------------------------------------


BASIS OF CALCULATIONS
---------------------

     . Construction Cost budget: $10,000,000
     . Construction Labor Hours Budget (Direct/Indirect): 160,000
     . Final Project Cost: $750,000 under Budget
     . Project Completed within Target Schedule
     . Labor Hours (Direct/Indirect): 15,000 Hours under Budget

 
INCENTIVE FEE EARNINGS FOR FWCI
-------------------------------
 
     . Final Project Costs within Budget:                  $250,000
     . Project Completed within Project Schedule           $250,000
     . Final Project Costs Underrun                        $250,000
       (500,000 x 50%)                             
                                                           --------
     . Total FWCI Incentive Fee Earned                     $750,000
 
BONUS POOL DISTRIBUTED TO PROJECT SUPERVISION AND ALL FIELD HIRED EMPLOYEES
---------------------------------------------------------------------------
 
     . FWCI Share: 20% of $750,000                         $150,000
     . Seadrift Share: (15,000 hrs x $7.00/hr)             $105,000
                                                
                                                           --------
       TOTAL Bonus Pool Distribution                       $255,000
 
 
                                  Page 1 of 1
<PAGE>
 
                   [LOGO OF FOSTER WHEELER USA CORPORATION]
 
                        FOSTER WHEELER USA CORPORATION
                                        

                              SEADRIFT COKE L.P.

                            FW CONTRACT 13-037624



                           COKER EXPANSION PROJECT



                                                                     EXHIBIT C
                                                  PRELIMINARY PROJECT SCHEDULE
<PAGE>
 
<TABLE>
<CAPTION>
                               ----------------------------------------------------------------------------------------------------
                                                                                 1997  
                               ----------------------------------------------------------------------------------------------------
                                       MAY              JUN           JUL                AUG              SEP            OCT      
                               ----------------------------------------------------------------------------------------------------
                                                                                                                               
    Description       Start    8, 5, 12, 19, 26   2, 9, 16, 23   30, 7, 14, 21, 28   4, 11, 18, 25   1, 8, 15, 22   29, 6, 13 20 27
-----------------------------------------------------------------------------------------------------------------------------------
<S>                 <C>  
ENGINEERING                   

Process Design       05MAY97A 
                              
Retail Engineering            
 & Procurement       01JUL97A 
                              
Equipment                     
 Deliveries          03NOV97*      
                                                                         [GRAPH APPEARS HERE]
CONSTRUCTION                  
------------------------------
Field Mobilization   08SEP97*     
                              
Civil                15SEP97*     
                              
Piping               29SEP97*     
                              
Equipment Erection   27OCT97*     
                              
Electrical           10NOV97*        
                              
Instrumentation      01DEC97*        
                              
Insulation/Painting  15DEC97*        
                              
Equipment Relocation 26JAN98* 
                              
Work Commences       16FEB98* 
                              
Mechanical                    
 Completion (T/A)    26FEB98* 
                              
Mechanical                    
 Completion                   
 (Post T/A Work)     31MAR98* 
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
<S>          <C>       <C>            <C>                   <C>                                  <C>                   <C>
Start        01MAY97   -------------  Early Bar                                                   Sheet 1 of1  
Finish       31MAR98   -------------  Progress Bar               Seadrift Coke L.P.    
Date         01SEP97                                          Seadrift Coker Expansion                                  EXHIBIT C
Date         05SEP97                                        Preliminary Project Schedule
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
                               ----------------------------------------------------------------------------------------------
                                              1997                                           1998                         
                               ----------------------------------------------------------------------------------------------
                                      NOV              DEC                 JAN                FEB               MAR          
                               ----------------------------------------------------------------------------------------------
                                                                                                                             
    Description       Start     3, 10, 17, 24    1, 8, 15, 22,29        5, 12, 19, 26     2, 9, 16, 23      2, 9, 16, 23, 3  
-----------------------------------------------------------------------------------------------------------------------------
<S>                 <C>  
ENGINEERING                   

Process Design       05MAY97A 
                              
Retail Engineering            
 & Procurement       01JUL97A 
                              
Equipment                     
 Deliveries          03NOV97*      
                                                                         [GRAPH APPEARS HERE]
                              
CONSTRUCTION                  
------------------------------
Field Mobilization   08SEP97*     
                              
Civil                15SEP97*     
                              
Piping               29SEP97*     
                              
Equipment Erection   27OCT97*     
                              
Electrical           10NOV97*        
                              
Instrumentation      01DEC97*        
                              
Insulation/Painting  15DEC97*        
                              
Equipment Relocation 26JAN98* 
                              
Work Commences       16FEB98* 
                              
Mechanical                    
 Completion (T/A)    26FEB98* 
                              
Mechanical                    
 Completion                   
 (Post T/A Work)     31MAR98* 
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>


<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
<S>          <C>       <C>            <C>                   <C>                                  <C>                   <C>
Start        01MAY97   -------------  Early Bar                                                   Sheet 1 of1  
Finish       31MAR98   -------------  Progress Bar               Seadrift Coke L.P.    
Date         01SEP97                                          Seadrift Coker Expansion                                  EXHIBIT C
Date         05SEP97                                        Preliminary Project Schedule
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>


<PAGE>
 
[LOGO]                                          PROJECT SPECIFICATION 37624-05A1
FOSTER WHEELER         PLANT COMPLETION         PAGE          1
USA CORPORATION                                 REV           1
                                                DATE          September 4, 1997
 

                                   CONTENTS

PARA.NO.    SUBJECT                                                         PAGE
--------    -------                                                         ----
      I.    SCOPE                                                             2
     II.    REFERENCES                                                        2

            A. API PUBLICATION 700                                            2
            B. ISA RECOMMENDED PRACTICE 7.1                                   2

    III.    DEFINITIONS                                                       2

            A. PRE-COMMISSIONING                                              2
            B. READY FOR COMMISSIONING                                        2
            C. COMMISSIONING                                                  2
            D. COMPLETION OF CONSTRUCTION                                     3

     IV.    GENERAL PROCEDURES                                                4

            A. MANUFACTURER OR VENDOR SERVICE                                 4
            B. PERMITS                                                        4
            C. INSTRUCTION                                                    4
            D. PACKING AND SEALS                                              5
            E. REMOVAL OF TEMPORARY BRACING                                   5
            F. ROTATION AND ALIGNMENT                                         5
            G. TIE-INS AT UNIT LIMITS                                         6
            H. LEAK AND PRESSURE TESTS                                        6
            I. INSPECTION                                                     7
            J. PRESSURE/VACUUM SAFETY RELIEF DEVICES                          8
            K. FLUSHING AND CHEMICAL/MECHANICAL CLEANING                      8
            L. TEMPORARY SCREENS, STRAINERS AND BLINDS                        9
            M. PURGING/INSERTING                                              9
            N. DRYING OUT                                                     9
            0. VESSEL PACKING AND FIXED BEDS                                 10
            P. HOUSEKEEPING                                                  10
            Q. MAINTENANCE, SPARE PARTS AND SPECIAL TOOLS                    10

      V.    SPECIFIC PROCEDURES                                              11

            A. VESSELS                                                       11
            B. SHELL AND TUBE EXCHANGERS                                     11
            C. AIR-COOLED EXCHANGERS                                         12
            D. FIRED HEATERS                                                 12
            E. PUMPS, COMPRESSORS AND DRIVERS                                13
            F. TANKS                                                         13
            G. PIPING SYSTEMS                                                14
            H. ELECTRICAL POWER AND LIGHTING SYSTEMS                         14
            I. INSTRUMENT SYSTEMS                                            17
            J. WATER SYSTEMS (SERVICE WELLS, COOLING
               TOWERS, FIRE WATER, SEA WATER)                                19
               
                                                                       EXHIBIT D
<PAGE>
 
[LOGO]                                          PROJECT SPECIFICATION 37624-05A1
FOSTER WHEELER         PLANT COMPLETION         PAGE          2
USA CORPORATION                                 REV           1
                                                DATE          September 4, 1997
 
 

        I.  SCOPE

            This standard is intended to define the transfer of responsibility
            from Foster Wheeler to the Constructor, if applicable; and to Owner
            for the care, custody and control of various units, systems or
            facilities of a plant.  A tabulation of the specific work
            performance responsibilities required to place process equipment or
            systems into operation is presented.

            The responsibilities of the Constructor are included on this listing
            or if the Constructor is contracted by FW USA then the Constructor's
            responsibilities are contractually those of FW USA.

        II. References

            A. API Publication 700, Second Edition, September, 1980.  The
               preceding content of this standard is derived from API 700.  The
               major difference is that it indicates which items Foster Wheeler
               expects to undertake versus those which the Owner is expected to
               complete.

            B. ISA Recommended Practice 7.1

       III. DEFINITIONS

            This section presents definitions which, along with the General and
            Specific Procedures given in Sections IV. and V., serve to clarify
            the basic principles associated with the transfer of responsibility
            from Foster Wheeler to the Owner at commissioning time.

            A. Pre-commissioning:  Pre-commissioning activities are the
               nonoperating adjustments and cold alignment checks made by Foster
               Wheeler as detailed in Sections IV. and V.

            B. Ready for Commissioning:  The plant, or part thereof, is "ready
               for commissioning" when the plant, unit, or facility, or any part
               thereof, has been erected in accordance with drawings,
               specifications, and applicable codes, to the extent necessary to
               permit commissioning, and when the pre-commissioning activities
               detailed in Sections IV. and V. have been completed.

            C. Commissioning:  The commissioning period follows the completion
               of the precommissioning activities performed by Foster Wheeler.
               Commissioning activities are associated with the operation of
               items of equipment or facilities in preparation for plant startup
               and may continue through the initial operation of the plant.
               These activities are the Owner's responsibilities unless the
               contract specifically provides otherwise.
<PAGE>
 
[LOGO]                                          PROJECT SPECIFICATION 37624-05A1
FOSTER WHEELER         PLANT COMPLETION         PAGE          3
USA CORPORATION                                 REV           1
                                                DATE          September 4, 1997



            D. Completion of Construction:  Completion of construction means
               that Foster Wheeler has:

               1.   Erected the Plant.

               2.   Completed pre-commissioning work.

               3.   Completed all special commissioning activities.  Special
                    commissioning activities are defined as those activities not
                    specifically covered herein and dictated by contractual
                    agreements as being specifically required.

               4.   Completed final cleanup, painting, and thermal insulation
                    work.
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[LOGO]                                          PROJECT SPECIFICATION 37624-05A1
FOSTER WHEELER         PLANT COMPLETION         PAGE          4
USA CORPORATION                                 REV           1
                                                DATE          September 4, 1997

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            IV.  GENERAL PROCEDURES

               The general work procedures listed below outline the work to be
               performed by Foster Wheeler and by the Owner.  Procedures
               applicable to specific systems or items of equipment are covered
               separately in Section V.

               A. Manufacturer or Vendor Service Assistance
                                                                                         X        X
                  1.  Obtain the assistance of the manufacturer or vendor when
                      necessary to make a satisfactory installation as agreed
                      upon by Foster Wheeler and the Owner.

                  2.  Obtain the assistance of the manufacturer or vendor, as                            X
                      required, for technical assistance during run-in by the
                      Owner's operating and maintenance personnel, for training,
                      or for informational and operating purposes.

                  3.  Furnish names and telephone numbers, including contacts,                           X
                      of manufacturer's and vendors; technical service
                      representatives for use by the Owner.

                B.  Permits

                  1. Make applications for all permits issued in the Owner's                             X
                     name that are required for plant installation, use,
                     occupancy, and operation.

               C. Instructions

                  1.  Maintain an adequate vendor instruction file so that                               X
                      information may be readily retrieved throughout plant
                      commissioning.
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FOSTER WHEELER     PLANT COMPLETION             PAGE          5
USA CORPORATION                                 REV           1
                                                DATE          September 4, 1997
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                   2. Transmit to the Owner all applicable vendor's or                   X
                      manufacturer's instructions and drawings.

                   3. Provide the Owner with any special                                 X        X
                      instructions.

                D. Packing and Seals

                   1. Install mechanical seals and accessories, as required                       X

                   2.  Install permanent packing and accessories, as required.                    X

                   3. Adjust and replace mechanical                                                      X
                      seals, packing, and accessories, as
                      necessary, during the commissioning
                      period.

                E. Removal of Temporary Bracing

                   1. Remove all temporary supports, bracing, or other foreign                    X
                      objects that were installed in vessels, transformers,
                      rotating machinery, or other equipment to prevent damage
                      during shipping, storage, and erection and repair any
                      damage sustained.

                   2. Remove other items as specified in items V.C.1, V.G.8 and                   X
                      V.J.1 for the appropriate equipment type.

                F. Rotation and Alignment

                   1. Check rotating machinery for correct direction of rotation                  X
                      and for freedom of moving parts before connecting driver.

                   2. Perform cold alignment to the                                               X
                      manufacturer's tolerances.

                   3. Perform hot alignment.                                                             X

                   4. Perform any doweling required.                                                     X

</TABLE>
<PAGE>
 
[LOGO]                                          PROJECT SPECIFICATION 37624-05A1
FOSTER WHEELER     PLANT COMPLETION             PAGE        6
USA CORPORATION                                 REV         1
                                                DATE        September 4, 1997
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                  5.  Obtain the services of a factory representative to witness                         X
                      installation of equipment, as required.

               G. Tie-ins at Unit Limits

                  1.  Identify each tie-in location and tag.                                             X

                  2.  Prepare all Systems for safe tie-ins.                                              X

                  3.  Obtain approval and make the necessary tie-ins at the unit                  X
                      limits, as required by the specifications and as directed
                      by the Owner.

                  4.  Remove blinds, car seals and so                                                    X
                      forth, as required.

               H. Leak and Pressure Tests

                  1.  Provide Test pressures on isometrics.                              X

                  2.  Notify the Owner of the schedule for non-operating field                    X
                      leak tests or field pressure tests on piping and field
                      fabricated equipment, unless otherwise directed by the
                      Owner.

                  3.  Provide any special media for test purposes and facilities                         X
                      for their disposal.

                  4.  Conduct all tests in accordance with applicable codes,                      X
                      specifications and regulations.

                  5.  Witness tests.                                                                     X

                  6.  Maintain records, as required.                                              X      X

                  7.  Dispose of test media in accordance                                         X
                      with the Owner's instructions.

</TABLE>
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[LOGO]                                          PROJECT SPECIFICATION 37624-05A1
FOSTER WHEELER     PLANT COMPLETION             PAGE          7
USA CORPORATION                                 REV           1
                                                DATE          September 4, 1997
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                  8.  Conduct all operational tightness tests.                                           X

                      Note:  Individual items of equipment of the following
                      types, if pressure tested in the fabricator's shop,
                      will not require retesting in the field, unless specified
                      by the Owner.  Such individual items of equipment shall be
                      included in the testing of attendant piping systems
                      whenever practical and approved by the Owner.

                      1. Vessels
                      2. Shell and tube exchangers
                      3. Air cooled exchangers

                I. Inspection

                  1.  Conduct flow diagram check of installed systems.                   X        X

                  2.  Provide inspection of the plant to verify that erected                      X
                      facilities conform to flow diagrams, construction
                      drawings, vendor prints, and specifications.

                  3.  Verify that specified materials have been installed in the                  X
                      plant and document verification to the extent required by
                      the Contract.

                  4.  Verify and approve the plant check. Note any exceptions on                         X
                      a separate work order list (punch list).

                  5.  Provide for special inspections, such as those required by                  X      X
                      insurance or governmental agencies.

                  6.  Perform and report routine shop                                    X
                      inspection and witness tests.

                  7.  Perform shop inspection and witness                                                X
                      tests, as desired.
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[LOGO]                                          PROJECT SPECIFICATION 37624-05A1
FOSTER WHEELER     PLANT COMPLETION             PAGE          8
USA CORPORATION                                 REV           1
                                                DATE          September 4, 1997
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                   8. Witness final shop inspections, as                                                 X
                      desired.

                      NOTE:  Shop inspected equipment will not be reopened for
                      inspection in the field except as specifically noted in
                      Section V.A.

                J. Pressure/Vacuum Safety Relief Devices

                   1. Provide the Owner with a list of                                   X
                      proper pressure settings.

                   2. Transfer relief devices to and from the Owner's specified                   X
                      testing facility.

                   3. Test, adjust and tag all safety devices and seal wherever                          X
                      necessary or desirable.

                   4. Install all devices after testing,                                          X
                      adjusting and tagging.

                   5. Maintain records, as required.                                                     X

               K. Flushing and Chemical/Mechanical Cleaning

                   1. Except as noted in IV.P, V.D, V.E, V.F, V.J, V.K and V.M:

                      a. Conduct all flushing, blowing, and chemical/mechanical                          X
                         cleaning operations where such operations can be
                         accomplished without using permanently installed
                         equipment.

                      b. Conduct all flushing and blowing operations where                               X
                         permanently installed equipment must be used to obtain
                         proper line velocities.

                     c.  Provide any special media for                                                   X
                         flushing and/or cleaning
                         purposes.

</TABLE>
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[LOGO]                                          PROJECT SPECIFICATION 37624-05A1
FOSTER WHEELER     PLANT COMPLETION             PAGE          9
USA CORPORATION                                 REV           1
                                                DATE          September 4, 1997
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                       d.  Dispose of all media in                                                       X
                           accordance with the Owner's
                           instructions.

                   2. Turn systems over to the client                                             X
                      free of trash and construction
                      debris (not necessarily free of
                      welding slag).

                   3.  Maintain records, as required.                                                    X

               L. Temporary Screens, Strainers, and Blinds

                   1.  Provide and install all required temporary strainers.                      X

                   2.    Clean strainers, as required,                                            X
                         during circulation.

                   3.    Remove strainers when system is                                          X
                         adequately cleaned.

                   4.    Provide, install, and remove all                                         X
                         blinds required for flushing.

                   5.    Provide, install and remove all                                          X
                         blinds required for isolation.

               M. Purging/Inserting
                   1.    Install purge/inserting connections.                            X

                   2.    Provide purge materials and conduct                                      X
                         necessary purge operations.

                   3.    Provide inserting materials and                                          X
                         introduce where specified.

               N. Drying Out

                   1. Dry out facilities, as required to prevent contamination                    X
                      of catalysts, operating materials and/or product.

                   2. Dry out systems, refractories and linings when this drying                  X
                      operation is to be accomplished with temporary facilities
                      such as in refractory lined ducts and vessels.

</TABLE>
<PAGE>
 
[LOGO]                                          PROJECT SPECIFICATION 37624-05A1
FOSTER WHEELER     PLANT COMPLETION             PAGE          10
USA CORPORATION                                 REV           1
                                                DATE          September 4, 1997
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                  3.  Dry out systems, refractories, and linings when this                               X
                      drying can be accomplished by means of permanently
                      installed equipment such as fired heaters.

                O. Vessel Packing and Fixed Beds

                  1.  Install all inert materials such as sand, gravel, balls,                           X
                      rings, and saddles.

                  2.  Install all materials other than the materials                                     X
                      specifically noted in Section V.

                  3.  Install all mixed beds involving combinations of materials                         X
                      covered 1. and 2. above.

                  4.  Inspect vessel interior before and during loading to                               X
                      ensure proper installation.

                  5.  Maintain records as required.                                                      X

                P.  Housekeeping

                  1.  At completion of construction, remove excess materials,                     X
                      temporary facilities, and scaffolding; rough sweep or rake
                      the area; and pick up trash.  Washing or further cleanup
                      is not included.

                  2.  After completion of construction, maintain adequate                                X
                      housekeeping practices, as required for safe operation.

               Q. Maintenance, Spare Parts and Special Tools

                  1.  Before and during precommissioning, protect equipment from                  X
                      normal weather conditions, corrosion or damage.

</TABLE>
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[LOGO]                                          PROJECT SPECIFICATION 37624-05A1
FOSTER WHEELER     PLANT COMPLETION             PAGE          11
USA CORPORATION                                 REV           1
                                                DATE          September 4, 1997
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          2.  After precommissioning is complete, provide adequate maintenance                           X
              for equipment, including the cleaning of strainers and the
              repairing of steam traps.

          3.  Provide the Owner with spare parts lists as recommended by the             X
              manufacturers.

          4.  After precommissioning, maintain adequate spare parts and supplies.                        X

    V.  Specific Procedures

        In addition to the work responsibilities described in Section IV, the
        detailed procedures outlined below further define the work
        responsibilities of Foster Wheeler and the Owner for specific systems
        and items of equipment.

        A.  Vessels

          1.  Open vessels after erection and put in place any internals                          X
              requiring field installation.  These internals will be inspected
              before and after installation.

          2.  Open both internal and external manways for inspection of vessel                    X
              by the Owner, unless otherwise specified.

          3.  Witness inspections to the extent desired.                                                 X

          4.  Head up after proper execution of closure permits.                                  X

        B. Shell and Tube Exchangers

          1.  Perform field inspection, if required, of exchangers that have                             X
              been shop tested.

</TABLE>
<PAGE>
 
[LOGO]                                          PROJECT SPECIFICATION 37624-05A1
FOSTER WHEELER     PLANT COMPLETION             PAGE          12
USA CORPORATION                                 REV           1
                                                DATE          September 4, 1997
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               C. Air-Cooled Exchangers

                  1.  Inspect exchangers to ensure that temporary shipping                        X
                      supports and erection material have been removed.

                  2.  Adjust fan assemblies to obtain                                             X
                      specified tip clearance and test.

                  3.  Check operation of louvers and                                              X
                      operating linkage.

               D. Fired Heaters

                  1.  Perform pressure test in accordance with the applicable                     X
                      codes and specifications.

                  2. Provide all nonoperating prefiring checks in accordance                      X
                     with manufacturer's instructions.

                  3.  Blow fuel lines, check them for cleanliness, and connect                    X
                      burner piping.

                  4.  Check operation of registers and dampers, and verify                        X
                      position of indicators.

                  5.  Check operation of air preheaters, blowers and soot                                X
                      blowers.

                  6.  Dry refractories during initial firing by following the                            X
                      manufacturer's temperature cycles.

                  7.  Conduct boilout, chemical cleaning,                                                X
                      and flushing operations as
                      required.  Dispose of wastes and
                      cleaning media.

                  8.  Obtain and charge liquid heat                                                      X
                      transfer media, if required.

                  9.  Conduct lightoff, drying, and                                                      X
                      purging operations.

</TABLE>
<PAGE>
 
[LOGO]                                          PROJECT SPECIFICATION 37624-05A1
FOSTER WHEELER     PLANT COMPLETION             PAGE          13
USA CORPORATION                                 REV           1
                                                DATE          September 4, 1997
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                  10. Obtain service engineer for technical assistance during                            X
                      installation or startup, if desired.

                E. Pumps, Compressors, and Drivers

                  1.  Level baseplates and soleplates grout all bearing                           X
                      surfaces.

                  2.  Alleviate any excess piping stresses that may be imposed                    X
                      on pipes, compressors, and drivers.

                  3.  Chemically clean any completed lube                                         X
                      and seal oil system, when
                      specified.  Dispose of wastes and
                      cleaning media in accordance with
                      the Owner's instructions.

                  4.  Charge the lube oil, seal oil, and                                                 X
                      oil cooling systems with flushing
                      oil.

                  5.  Circulate flushing oil through lube oil, seal oil and oil                          X
                      cooling systems for cleaning purposes. Dispose of any
                      flushing oil.

                  6.  Charge the lube oil, seal oil, and oil cooling systems                      X
                      with the operating oil recommended by the manufacturer.

                  7.  Operate equipment and make vibration, trip, governor, and                          X
                      safety device checks, and any operating tests and
                      adjustments required.

                  8.  Obtain the assistance of a service engineer for technical                   X
                      advise during installation or startup, if desired.
                  9.  Maintain records as required.                                                      X

</TABLE>
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[LOGO]                                          PROJECT SPECIFICATION 37624-05A1
FOSTER WHEELER     PLANT COMPLETION             PAGE          14
USA CORPORATION                                 REV           1
                                                DATE          September 4, 1997
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                F.  Tanks

                  1.  After erection and installation, install any internals                      X
                      which require field installation.

                  2.  Test tank and internals, as required.  Dispose of test                      X
                      water in accordance with the Owner's instructions.

                  3.  Conduct chemical cleaning or flushing operations, as                               X
                      required. Dispose of wastes and cleaning media.

                  4.  Witness test and inspections to the                                              X
                      extent desired.

                  5.  Close after proper execution of                                             X
                      closure permits.

                G.  Piping Systems

                  1.  Notify the Owner of test schedule.                                          X

                  2.  Hydrostatically or pneumatically                                            X
                      test all piping as required by the
                      codes and specifications.

                  3.  Witness field pressure tests when                                                  X
                      noticed.

                  4.  Drain system and install orifice plates.  Orifice plates                    X
                      should not be installed before testing.  If installed,
                      they will be removed as necessary.  (See Section V.J. for
                      the removal or isolation of other inline components.)
 
                  5.  Remove blinds and perform tightness                                                X
                      tests, as required.

                  6.  Insulate or paint flanges, threaded joints, or field welds                  X
                      after the specified testing of each item has been
                      completed unless instructed otherwise by the Owner.

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[LOGO]                                          PROJECT SPECIFICATION 37624-05A1
FOSTER WHEELER     PLANT COMPLETION             PAGE          15
USA CORPORATION                                 REV           1
                                                DATE          September 4, 1997
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                                                                                              RESPONSIBILITY

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<CAPTION>
                  7.  Leave exposed all welded joints (longitudinal, girth, and                   X
                      nozzle) in underground piping that have not been shop
                      tested until the specified testing has been completed.
                      This does not apply to the longitudinal fabrication joint
                      in ERW pipe.  After final testing of these joints, cover
                      the system.

                  8.  Check pipehangers, supports, guides, and pipe specialties                   X
                      for the removal of all shipping and erection stops and for
                      the correctness of cold settings for the design service.
                      Also, provide the Owner with instructions for hot
                      settings.

                  9.  Check pipehangers, supports, guides, and pipe specialties                          X
                      for hot settings and make minor adjustments as necessary.

                  10. Install permanent filter elements as required.                              X

                  11. Verify that specified valve packing has been provided on                    X
                      valves installed in the plant.

                  12. Install car seals or chain locks on valves where required                          X
                      by Engineering Flow Diagrams.

                  13. Check and record position of all car-sealed or chain-                              X
                      locked valves; identify valves as specified.

                  14. Correct support, vibration, and thermal expansion problems                  X
                      detected during commissioning.

                  15. Retorque all hot and cold service bolting during                                   X
                      commissioning as required.

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[LOGO]                                          PROJECT SPECIFICATION 37624-05A1
FOSTER WHEELER     PLANT COMPLETION             PAGE          16
USA CORPORATION                                 REV           1
                                                DATE          September 4, 1997
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                H. Electrical Power and Lighting Systems

                  1.  Notify the Owner of the test schedule.                                      X

                  2.  Witness tests when notified and record test data if                                X
                      desired.

                  3.  Using a megohmmeter, make insulation tests on all wiring                    X
                      except lighting wiring.

                  4.  Using a megohmmeter, make insulation tests on motor and                     X
                      transformer windings from phase to phase and phase to
                      ground.

                  5.  Make grounding system tests to determine the continuity of                  X
                      connections and the value of resistance to ground.

                  6.  Arrange for breakdown tests on oil samples from oil                         X
                      insulated transformers larger than 100 kva absolute.

                  7.  Charge electrical gear with oil and/or other media, when                    X
                      required.

                  8.  Perform trials and adjustments on all switchgear, motor                     X
                      control equipment and generators.

                  9.  Test and set switchgear and circuit breaker relays for                      X
                      proper coordination as required by ENG STD 70A2.

                  10. Obtain local inspector's approval                                                  X
                      where required.

                  11. Energize all substations, with approval of the Owner,                       X
                      after completion of all tests.
 
                  12. Check phase sequence and polarity.                                          X

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[LOGO]                                          PROJECT SPECIFICATION 37624-05A1
FOSTER WHEELER     PLANT COMPLETION             PAGE          17
USA CORPORATION                                 REV           1
                                                DATE          September 4, 1997
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                  13. Check installation of emergency power and lighting                          X
                      systems, including light intensity.

                  14. Provide the Owner with a record of                                          X
                      work completed.

                  15. Measure light intensity if                                                         X
                      required.

                I. Instrument Systems

                  1.  Conduct any nonoperating checks to ensure instrument                        X
                      operability, e.g., remove all shipping stops; check
                      pointer travels; and verify instrument capability to
                      measure, operate, and stroke in the direction and manner
                      required by the process application.

                  2.  As directed by the Owner's practice, bench or field                                X
                      calibrate instruments with standard test equipment and
                      make all required adjustments and control point settings.

                  3.  Clean all transmission and control tubing by blowing with                   X
                      cooled and filtered clean air before connecting to
                      instrument components.

                  4.  Clean all air-supply headers by blowing with clean air and                  X
                      check them for tightness.

                  5.  Leak test pneumatic control circuits in accordance with                     X
                      the latest edition of ISA Recommended practice 7.1:
                      Pneumatic Control Circuit Pressure Test.

                  6.  Check piping from instruments to                                            X
                      process piping for tightness.

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[LOGO]                                          PROJECT SPECIFICATION 37624-05A1
FOSTER WHEELER     PLANT COMPLETION             PAGE          18
USA CORPORATION                                 REV           1
                                                DATE          September 4, 1997
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                                                                                              RESPONSIBILITY

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                  7.  Install and connect all system hardware and verify their                    X
                      conformance to specifications and design criteria for
                      function and range.

                  8.  Check all electrical signals and alarm wiring for                           X
                      continuity, correct source of power, and polarity.

                  9.  Check thermocouples for proper joining of wires, position                   X
                      of elements in wells, proper polarity, and continuity of
                      receiving instruments.

                  10. Identify orifice plates by tagging and deliver to the                       X
                      Owner.

                  11. Check and record bores of orifice plates and install after                  X
                      completion of flushing operations.

                  12. Isolate or remove, if necessary, inline components such as                  X
                      control valves, positive displacement meters, and turbine
                      meters for pressure testing.  Reinstall these items after
                      testing the system with the components removed or
                      isolated.

                  13. Isolate or remove inline components for flushing                                   X
                      operations and reinstall them on the completion of these
                      operations.

                  14. Install any sealing fluids, as                                              X
                      required.

                  15. Fully pressurize and energize the transmitting and control                         X
                      signal system(s) by opening process connections at primary
                      sensors and final regulators, and by making control mode
                      settings for automatic operation of equipment as the
                      process unit is charged and brought on stream.

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[LOGO]                                          PROJECT SPECIFICATION 37624-05A1
FOSTER WHEELER     PLANT COMPLETION             PAGE          19
USA CORPORATION                                 REV           1
                                                DATE          September 4, 1997
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                                                                                              RESPONSIBILITY

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                  16.  Provide a schedule of recorder                                                    X
                      charts.

                J. Water Systems (Service Wells, Cooling                                                 X
                   Towers, Fire Water Systems, and Sea Water Systems)

                  1. Inspect for completeness and                                                 X
                     correctness of installation and make any
                     nonoperating checks that may be required.

                  2. Clean the cooling tower basin and                                            X
                     install screens in the suction pit before
                     water circulation.

                  3. Provide test pump for wells; test                                            X
                     well delivery; and flush wells when wells
                     are provided by Foster Wheeler.

                  4. Flush, drain, and clean the cooling tower basins.                                   X

                  5.  Clean intake screens after flushing.                                               X

                  6. Adjust cooling tower fans to obtain                                          X
                      specified tip clearance and test.

                  7.  Operate fire pumps to check output of systems.                                     X

                  8.  Head up reservoirs, vessels, tanks, and other water                                X
                      systems equipment as required, fill with water, check for
                      leaks, and flush to clean.

                  9.  Provide insurance company inspection of the fire system as                         X
                      required.

                  10  Obtain and install all required fire fighting chemicals                            X
                      and portable equipment such as hoses, fire extinguishers,
                      and related equipment.
 
 
</TABLE>
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[LOGO]                                          PROJECT SPECIFICATION 37624-05A1
FOSTER WHEELER     PLANT COMPLETION             PAGE          20
USA CORPORATION                                 REV           1
                                                DATE          September 4, 1997
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                  11. Establish water treatment program.                                                 X

                  12. Obtain the services of a water consultant to advise and                            X
                      monitor the water treatment.
                                                                                                         X

                                                                                                         X

</TABLE>