exv10w6



 






Exhibit 10.6




CRUDE SALES CONTRACT



This contract by and between Plains Marketing, L.P. (“Plains”) with an address of 333 Clay Street,
Suite 1600, Houston, TX 77002 and Calumet Shreveport Fuels, LLC (“Calumet Shreveport”) with an
address of 3333 Midway Avenue, Shreveport, La 71109, covering the sale and delivery by Plains and
the purchase and receipt by Calumet Shreveport of the hereinafter specified oil is entered into in
accordance with the following terms and conditions:




	 	 	 	 	 	 	 
	CONTRACT NO.	 	 	 	5689-1006
	 
	 	 	 	 	 	 
	1.	 	TERM:	 	Effective March 1,2005 to February 29,2008, or three years from completion date of Plains P/L LP facilities (which ever is later) and continuing month to month thereafter until terminated by either party hereto upon not less than ninety (180) days advance written notice to the other party.
	 
	 	 	 	 	 	 
	2.
	 	QUALITY:	 	1)	 	East Texas Common crude oil and condensate.
	 
	 	 	 	2)	 	North Louisiana Sweet crude oil and condensate.

	 
	 	 	 	3)	 	North Louisiana Sour.
	 
	 	 	 	 	 	 
	3.	 	QUANTITY:	 	Approximately 19,200 barrels per day. Anticipated volumes are 4,500 bopd of condensate, 1,000 North Louisiana Sour, and remaining volume is East Texas Common and North Louisiana Sweet.
	 
	 	 	 	 	 	 
	4.	 	DELIVERY:	 	Shall be made into the following designated facilities or equipment by prior written agreement:
	 
	 	 	 	 	 	 
	 
	 	 	 	1)	 	Into trucks designated by Calumet Shreveport, at Plains P/L Gas Center Station Shreveport, La
	 
	 	 	 	2)	 	Calumet Shreveport Refinery located in Shreveport, La via Plains designated trucks.
	 
	 	 	 	 	 	 
	 
	 	 	 	Or	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	1)	 	Calumet Shreveport Refinery located at Shreveport, La via Plains PIE. L. P.
	 
	 	 	 	2)	 	Caluniet Shreveport Refinery located in Shreveport, La via Plains designated trucks.
	 
	 	 	 	 	 	 
	5.	 	PRICE:	 	For the crude oil sold and delivered hereunder, Calumet Shreveport agrees to pay Plains a price per barrel equal to Plains’ West Texas Intermediate (All Other Areas) crude oil posting, deemed 40.0° API gravity based on equal daily quantities plus Platt’s average P-Plus for the trading month of delivery (excluding weekends and U. S. Holidays) plus a location differential of:
	 
	 	 	 	 	 	 





 









 






	 	 	 	 	 	 	 
	 
	 	 	 	1)	 	Plains P/E. Gas Center Facility
	 
	 	 	 	 	 	Crude/Condensate to Calumet Shreveport designated trucks at Gas Center
	 
	 	 	 	 	 	8.45 per barrel
	 
	 	 	 	 	 	Crude/Condensate to Shreveport Refinery via Truck 80.15 per barrel

	 
	 	 	 	 	 	North Louisiana Sour to Shreveport Refinery via Truck less $1.25 per
	 
	 	 	 	 	 	barrel
	 
	 	 	 	2)	 	Plains Pipeline connection into the
Shreveport Refinery
	 
	 	 	 	 	 	Crude/Condensate to the Shreveport Refinery via Plains P/L Year 1
	 
	 	 	 	 	 	$0.98, Year 2 $0.80, Year 3 $0.80

	 
	 	 	 	 	 	Crude/Condensate to Shreveport Refinery via Truck $0.15 per barrel
	 
	 	 	 	 	 	North Louisiana Sour to Shreveport Refinery via Truck less $1.25 per barrel






     These G&H numbers are based on the current East Texas market. If this market changes
substantially from historic levels then Plains reserves the right to renegotiate the price to
maintain supply. Should Calumet and Plains not be able to agree to a renegotiated price the thruput
agreement shall be reduced by the volume lost.




	6.	 	Thruput commitment Minimum of 12,000 b/d take or pay (rate is $0.25) to be received from
Plains Pit at Gas Center Station or via plains Pit delivered to Shreveport refinery.
Settlement to be annual. The Pit maximum capacity at this point in time is 15,000 b/d.
Calumet to provide and maintain the Lact unit from Plains PIE, into the Shreveport Refinery if
this option is done.






	7.
	 	
Plains reserves the right to enter a B/S agreement on portion of the overall supply,
contingent on reaching an acceptable net-out agreement. Maximum volume will be limited to
7,000 b/d. Should Calumet/Shreveport be required to post letter of credit to a third party to
supply barrels to Plains for this obligation. The Letter of Credit described in paragraph 8
below shall be reduced by an equal volume of barrels.







	8.	 	PAYMENT: Until further arrangements for payment or credit are mutually agreed to, Calumet
Shreveport agrees to pay Plains:






	 	1)	 	Weekly Estimated Settlements: On or before close of business each Wednesday
during the term of this agreement, Calumet will wire transfer funds to Plains for all
net barrels metered and sold to Calumet Shreveport during the previous Wednesday
through Tuesday. The amount per barrel to be paid in the weekly estimated settlement
shall be the Plains’ West Texas Intermediate (All Other Areas) month-to-date average
crude oil posting deemed 40° API plus Plan’s average P-Plus for the trading month of
delivery (excluding weekends and U.S. holidays) plus a location differential as shown
in paragraph 5 herein.
	 
	 	2)	 	Upon receipt of monthly settlement invoices, final monthly net payment shall be
made by wire transfer of funds on or about the twentieth (20th) day of the
month following the month of delivery. Wire transfer funds to Plains per the wire
instructions shown on Plains’ settlement invoices.




 









 












	9.	 	CREDIT SUPPORT: On or before November 29, 2004 or until otherwise mutually agreed, Calumet
Shreveport agrees to provide Plains an irrevocable letter of credit, issued by a bank
acceptable to Plains utilizing a form acceptable to Plains in an amount equal to eight (8)
days of oil delivered pursuant to this agreement. Plains agrees to continue periodic reviews
of Calumet Shreveport’s credit worthiness until such possible time Calumet Shreveport supports
and open line of credit.





     PMLP’s General Provisions dated February 1, 2001 are incorporated herein by reference and made
a part hereof. To the extent of any conflict between the provisions herein and the General
Provisions, the provisions herein shall govern.



	 	 	 	 	 	 
	 	Buyer

	 	 	Seller	 
	 	Calumet Shreveport Fuels, LLC

	 	 	Plains Marketing, LP	 
	 	Agreed to and accepted this 15th day of
October, 2004

	 	 	Agreed to and accepted this
18th day of October, 2004	 
	 	By: /s/ Robert M. Mills

	 	 	By: /s/ George Coiner	 
	 	Robert M. Mills
Vice President, Crude Oil Supply

	 	 	Senior Group Vice President,
Plains Marketing L.P.	 
	 





 









 






PLAINS MARKETING, L. P.

By Plains Marketing GP Inc.

Its General Partner

GENERAL PROVISIONS/OIL PURCHASE CONTRACT





	I.	 	PAYMENT: As soon as possible after the dose of each calendar month during which deliveries
are made, Seller shall invoice Buyer for the crude oil delivered. Unless otherwise provided
herein, payment for the oil purchased hereunder shall be made by the twentieth (20th) of the
month following the month of delivery, subject to timely receipt by Buyer of invoice and
written confirmation of invoiced quantity from the receiving facility. If the payment date
falls on a Saturday or Non-Friday bank holiday, payment will be due on the next succeeding
work day. All deliveries hereunder shall be deemed a single on-going transaction.
	 
	II.	 	SET-OFFS: In the event either party shall tail to make timely
delivery of any crude oil and/or condensate or other applicable
products due and owing to the other party, or in the event that
either party shall fail to make timely payment of any monies due and
owing to the party, the other party may set off any deliveries or
payments due under this or any other agreement between the parties.
Party for the purposes of this paragraph shall include for each party
its affiliates (including, but not limited to, both parent and
subsidiary companies). It is the intent of the parties to this
contract to treat each party hereto and its respective affiliates
(including, but not limited to, both parent and subsidiary corporate
entities) as a single legal entity for the purposes of set-off
regarding debts and claims.
	 
	III.	 	RIGHT TO AUDIT: In the event the price of the crude oil or condensate
sold hereunder is based on an average acquisition cost, Seller agrees
to maintain and retain all pertinent books, records and documents
relating to the transactions hereunder for a period of not less than
two (2) years following termination of this agreement, and Buyer or
its duly authorized representatives shall have access to such
records, and the right to audit the same, at all reasonable times
during the existence of this Contract, and for such two (2) year
period following its termination.
	 
	IV.	 	MEASUREMENTS AND TEST: Quantities of oil delivered hereunder shall be
determined from tank gauges on 100% tank table basis or by the use of
mutually acceptable automatic measuring equipment. Volume and gravity
of said quantities shall be corrected for temperature to 60°
Fahrenheit in accordance with the latest A.S.T.M.-I.P. Petroleum
Measurement Tables. The oil delivered hereunder shall be merchantable
and acceptable to the carriers involved but not to exceed one percent
(1%) S&W. Full deduction shall be made for all S&W content as
determined by tests conducted according to the latest A.S.T.M.
standard method in effect.
	 
	V.	 	Tests for quality shall be made at regular intervals by Seller in accordance with recognized
procedures. Each party shall have the right to have a representative or independent inspector
(which cost shall be shared equally between the parties hereto) present to witness all gauges,
tests and measurements.




 









 






	VI.	 	WARRANTY: Seller warrants title, free and clear of all taxes, liens
and encumbrances which are customarily paid by Seller prior to
delivery, to the oil sold and delivered hereunder and warrants that
said oil has been produced, handled and transported to the delivery
point hereunder in accordance with the laws, rules and regulations
of all local, state or federal authorities having jurisdiction
thereof. In this regard, Seller agrees to provide Buyer with any
transaction documentation requested.
	 
	VII.	 	FORCE MAJEURE: Continued performance by either party of any
obligation except as to payment due hereunder, may be suspended
immediately to the extent caused or contributed to by acts of God,
fire, labor or trade disturbance, war, civil commotion or act of the
public enemy, unavailability of transportation, storage,
manufacturing, refining or distributing facilities, compliance in
good faith with any applicable foreign or domestic regulation or
order, whether or not it later proves to be invalid, or any cause
beyond the reasonable control of either Buyer or Seller whether
similar or dissimilar to the enumeration contained herein, except
inability to discharge financial obligations when due. The party
suspending performance under this clause shall give prompt notice
and shall use its best efforts to cure promptly the cause for such
suspension. Upon cessation of the cause for suspension, performance
shall resume (or commence) immediately. However, if any given Force
Majeure condition continues beyond ninety (90) days. the party not
claiming said condition shall have the option of terminating this
contract upon the giving of written notice thereof to the other
party.
	 
	VIII.	 	TITLE AND RISK OF LOSS: Title and risk of loss to crude oil
delivered into storage, tankers, barges, tank trucks, and/or
pipeline facilities shall pass to Buyer as the crude oil enters the
intake pipes of such equipment of the receiving facility, or is
in-line transferred.
	 
	IX.	 	ENTIRETY OF AGREEMENT, MODIFICATION, WAIVER, AND ASSIGNMENT: This
Contract and amendments constitute the entire understanding of the
parties relating to the sale of the crude oil specified herein.
There shall be no modification or amendment of this Contract except
by writing, signed by both parties hereto. Waiver of performance of
any obligations by either party of default by the other hereunder
shall not operate as a waiver of performance of any other obligation
or a future waiver of the same obligation or a waiver of any future
default. Neither party shall assign this Contract to a person or
firm except upon written consent of the other party, such consent,
however, shall not be. unreasonably withheld. This Contract shall be
binding upon and inure to the benefit of the successors and assigns
of the parties hereto.
	 
	X.	 	EQUAL DAILY DELIVERIES: Except for delivery by truck tanker, for the purpose of invoicing,
any crude oil delivered hereunder shall be deemed to have been delivered in equal daily
quantities during the calendar month in which deliveries occur.
	 
	XI.	 	CHOICE OF LAW: This Contract shall be constructed in accordance
with, and governed by, the law of, and Buyer and Seller consent to
the jurisdiction of the courts of, the State of Texas.




 









 






	XII.	 	DEFAULT: In the event Seller shall fail to make timely deliveries
due Buyer under this Contract, or if Seller is otherwise in default
hereunder, Buyer may, on written notice to Seller terminate this
contract or suspend performance of all obligations hereunder during
default.
	 
	XIII.	 	NOTICE: Any notice required or permitted hereunder shall be deemed
given when deposited in the U.S. Mail as registered or certified
mail, return receipt requested, postage prepaid, and addressed to
the party to whom the notice is being given at the address set forth
on the first page hereof (or such other address as is provided by
written notice in accordance with this provision). During the term
of this Contract Seller herein agrees to notify Buyer immediately in
writing upon Seller’s corporate reorganization, merger, or
acquisition by another, or any other similar corporate structural
change.