Document:

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"Pages where confidential treatment has been requested are marked 'Confidential
Treatment Requested.' The redacted material has been separately filed with the
Commission, and the appropriate section has been marked at the appropriate place
and in the margin with a star (*)."

                                                                   Exhibit 10.13

                                OPERATING AGREEMENT

                                     BETWEEN

                             WARREN PETROLEUM COMPANY,
                               LIMITED PARTNERSHIP

                                       AND

                            CHEVRON PIPE LINE COMPANY

THIS AGREEMENT is made and entered into as of September 1, 1996 by and between,
Warren Petroleum Company, Limited Partnership, a Delaware limited partnership
(hereinafter referred to as "Company"), and Chevron Pipe Line Company, a
Delaware Corporation (hereinafter referred to as "Operator").

WHEREAS, Company is the owner of certain petroleum products pipeline facilities
("Facilities") more particularly identified in Attachment II and Attachment III;
and

WHEREAS, Company does not have a working staff to operate the Facilities and
desires to engage Operator in these respects;

NOW, THEREFORE, in the consideration of the premises and mutual covenants
contained in this Agreement, Company and Operator agree as follows:

Section 1. DEFINITIONS

As used in this Agreement, the following words and terms shall have the meanings
set forth:

"Accounting Procedure" means the accounting procedure set forth in Attachment I,
hereof.

"AFE" means an approval for expenditure in the form approved by Company.

"Affiliate" of another Party means a company that beneficially owns, directly or
indirectly, more than fifty percent of the voting stock of such Party or another
company whose voting stock in turn is more than fifty percent owned by such
company.

"Agreement" means this Operating Agreement together with all Attachments.

<Page>

"Capital Commitment Budget" means the capital budget as further described in
Section 5A. of this Agreement.

"Capital Expenditure Forecast" means the capital expenditure forecast as
further described in Section 5B. of this Agreement.

"Cash Operating Costs" means amounts payable to Operator under Section 3 of this
Agreement.

"Confidential Information" means any information relating to the identity of
shippers using the Facilities, the nature, kind, quantity, destination or
consignee or routing of Products using the Facilities, or any other information
which is in writing and has been labeled by Company as confidential.
Confidential Information shall not include any information which is acquired by
Operator in the course of its activities outside of the scope of this Agreement
or which becomes part of the public knowledge or literature without breach of
this Agreement.

"Costs" means all costs charged to the Company as provided in the Accounting
Procedure.

"Expenditure Authorities" means the expenditure authorities described in
Section 6. of this Agreement.

"Facilities" means the facilities identified in Attachment II and Attachment III
hereto.

"Force Majeure" means an occurrence not within the control of the party and
which by the exercise of reasonable efforts such party is unable to prevent or
overcome, and shall include, but not be limited to, acts of God, strikes,
lockouts, or other industrial disturbances, acts of the public enemy, wars,
blockades, insurrections, riots, epidemics, landslides, lightning, earthquakes,
fires, storms, floods, washouts, hurricanes, storm warnings requiring evacuation
of facilities, arrests or restraints of the government, either federal or state,
civil or military, civil disturbances, explosions, sabotage, breakage or
accident to equipment, machinery or lines of pipe, extreme heat or cold weather,
freezing of machinery, equipment or lines of pipe, electric power shortages,
inability of any Party to obtain necessary materials and supplies, inability of
any Party to obtain necessary permits and/or permissions due to existing or
future rules, orders, laws or governmental authorities (both federal, state and
local), temporary cleaning or testing of facilities, temporary failure of
supply, or any other causes, whether of the kind herein enumerated or otherwise,
which were not reasonably foreseeable on the effective date of this Agreement,
and which are not within the control of the Party claiming suspension and which
such Party is unable to overcome by the exercise of due diligence. The term
"Force Majeure" shall also include those instances in which either Party hereto
is required to furnish materials and supplies for the purpose of constructing
and maintaining facilities or is required to secure permits or permission from
any governmental agency to enable such Party to acquire, or the delays on the
part of such Party in acquiring, at reasonable cost and after the exercise of
due diligence, such materials and supplies, permits and permissions. It is
understood and agreed that the settlement of strikes or lockouts shall be
entirely within the discretion of the Party having the difficulty, and that the
above requirement that any Force Majeure shall be remedied with all reasonable
dispatch shall

                                        -2-
<Page>

not require the settlement of strikes or lockouts by acceding to the demands
of opposing parties when such course is inadvisable in the discretion of the
Party having difficulty. The term "Force Majeure" shall also include any such
event occurring with respect to the facilities or services of either
Operator's or Company's third-party suppliers or customers delivering or
receiving any product, fuel, feedstock, or other substance necessary to the
continuous operation of either Party's plants or facilities or performance of
such Party's obligations, and shall also include curtailment or interruption
of deliveries or service by such third-party suppliers or customers as a
result of (i) another event of Force Majeure or (ii) a breach by such
third-party under the applicable agreement(s).

"Insurance Manual Rates" means the published insurance industry recognized
computations of standard accepted insurance rates.

"Major Maintenance Budget" means the major maintenance budget as further
described in Section 5C. of this Agreement.

"Operating Expense Budget" means the operating expense forecast as further
described in Section 5D. of this Agreement.

"Operator" means Chevron Pipe Line Company acting in its capacity as operator of
Facilities hereunder.

"Parties" or "Party" means the Operator and/or Company.

"Products" means, without restriction natural gas or gas liquids, or product
derived from petroleum.

"Year" means a calendar year.

Section 2. OPERATIONS

Operator agrees to operate, maintain and repair the Facilities, and any
modifications or improvements thereof, and to perform any other duties as may be
requested by Company. Company does hereby authorize and empower Operator, on
behalf of Company, to do and perform or cause to be done and performed by others
any and all acts and things which Operator shall, in the exercise of its
discretion and judgment, deem necessary or advisable for the operation,
maintenance, and repair of such Facilities in accordance with the Expenditure
Authorities of Section 6, to the end that the Facilities may be used in a safe,
efficient and economical manner for receipt, delivery, measurement and
transportation of Products. Without limiting the foregoing, Operator shall:

                                            -3-
<Page>

A. perform such mechanical activities as may be required to receive, deliver,
   transport and/or otherwise handle Products tendered to and accepted into the
   Facilities.

B. submit to Company recommended budgets and other information as set forth
   in Section 5. hereof.

C. purchase or cause to be purchased for and in the name of Company
   materials, supplies and services necessary for the operation of the
   Facilities in accordance with the budgets approved by Company (or as
   otherwise approved under this Agreement);

D. maintain surveillance of the Facilities, periodically inspect the
   Facilities for damage or other conditions which could affect the safe,
   efficient and economical operation of the Facilities, and perform such
   repairs to the Facilities as requested by Company or as required;

E. act as representative for Company in contacts with government agencies
   relating to the physical operation, maintenance and repair of the Facilities,
   where required by laws, rules, regulations, orders, permit conditions, or
   right-of-way agreements;

F. prepare, maintain and implement operating manuals, monitoring programs,
   contingency plans and training programs satisfying all applicable laws,
   rules, regulations, orders and any other requirements of governmental
   authorities together with such other operating procedures or manuals as
   Company may require;

G. prepare run tickets, daily status reports and other appropriate accounting
   materials to document custody transfer and receipt of Products, and sample
   and measure Products received and delivered to verify quality and quantity as
   operations may require;

H. prepare appropriate surveillance, operating and maintenance reports to
   document the performance of the Facilities;

I. file, store and maintain in a manner such that they shall be available for
   periodic inspection by Company all as-built drawings or descriptions of the
   Facilities, construction and maintenance records, inspection and testing
   records, operating procedures and manuals, custody transfer documents, and
   such other records (all collectively "records") as may be necessary or
   appropriate to the operation, maintenance and repair of Facilities, or
   required by applicable laws, rules, regulations, orders and any other
   requirements of governmental authorities, or requested by Company. All of
   such records shall remain the property of Company;

                                            -4-
<Page>

J. to the extent applicable, prepare and file all tariffs subject to approval
   of Company;

K. keep correct and complete accounts of all non-transportation related
   receipts and disbursements made on the Company's behalf.

L. attend, upon request, meetings of Company, or, whenever otherwise
   required by Company, prepare and distribute reports of all financial
   transactions involving the Company hereunder;

M. subject to approval of Company make all statutory and regulatory filings
   required of the Company, including without limitation, all permit
   applications, and filings with the Federal Energy Regulatory Commission and
   state Public Utilities Commissions, Department of Transportation, or other
   regulatory agencies having jurisdiction over Company; and

N. provide equipment, materials and services as legally required or as Company
   may from time to time request, for discharge prevention and response for
   Products and/or hazardous substances. These services shall include, but not
   be limited to preparation, submission, and finalization of discharge
   prevention and/or contingency plans for Products and/or hazardous substances,
   and preparation for, prevention of, response to and/or cleaning up of any
   discharge or threatened discharge of Products and/or hazardous substances.
   Without limiting the foregoing, Operator shall serve as response action
   contractor for Company; and,

O. Provide right-of-way services relating to Facilities.

Notwithstanding the foregoing, Operator shall not perform any transportation
related revenue collection or accounting services on behalf of Company.

Operator agrees to perform all services hereunder in a manner consistent with
the usual and customary practices, codes and standards in the pipeline industry
(including specifically the Federal Energy Regulatory Commission, state Public
Utilities Commissions as well as applicable Department of Transportation and
American National Standards Institute) and in accordance with all valid and
applicable laws, rules, regulations, orders and any other requirements of
governmental authorities. Operator in its capacity as Operator pursuant to this
Agreement, shall assume no other liability to Company except in the case of
Operator's own gross negligence or willful misconduct. Operator shall furnish or
arrange for the necessary personnel to efficiently perform such services. None
of such personnel shall be employees or agents of Company, statutory or
otherwise.

                                     -5-
<Page>

Section 3. PAYMENT FOR OPERATOR SERVICES

        A. Company shall pay and Operator shall receive as full and complete
           compensation for the performance of Operator's services as
           Operator hereunder, the sum of the amounts becoming due as
           described and authorized in Attachment I, Accounting Procedure.
           Company shall make payment in the time and manner specified
           herein. To the extent incurred in the performance of services
           hereunder, amounts of such payment to Operator are hereinafter
           collectively referred to as Cash Operating Costs.

         B. Within the month immediately following the previous month of
            service, Operator shall invoice Company for the actual Cash
            Operating Costs for the immediately prior month. Company shall
            pay to Operator the amount of such invoice, payable upon receipt.

Section 4. ACCOUNTING

Operator shall maintain accurate accounts of all expenditures and liabilities
incurred by it in operating, maintaining and repairing the Facilities and shall
render a monthly statement to Company of all such expenditures and liabilities.
The failure to include any item in the current monthly statement rendered for
the month in which the same was incurred or expended shall not preclude such
item from being brought forward and included in any subsequent monthly
statement. All books, records and accounts shall be open to inspection and audit
by Company or Company's authorized representatives at all reasonable times
during business hours.

Section 5. BUDGETS AND FORECASTS

On or before November 1 of each year, Operator shall prepare and submit to
Company for review, approval, or modification the following annual budgets and
forecasts:

        A. Capital Commitment Budget

           The Capital Commitment Budget shall consist of an itemization of
           commitments for each capital project equal to or in excess of $25,000
           (large projects) and a combined total of all Items less than $25,000
           (small projects) for the following calendar year. Supporting
           justification shall be included for each large project.
           Supporting justification will not be required for small projects.

        B. Capital Expenditure Forecast

           The Capital Expenditure Forecast shall identify separately all
           expenditures for capital items from prior budgets which are not
           yet complete and all capital items

                                         -6-
<Page>

           anticipated to be approved in the pending budget. Large projects
           shall be listed individually and small projects may be combined.
           The forecast shall indicate expenditures by quarter for the
           following calendar year and indicate any appropriate carryover in
           subsequent years.

        C. Major Maintenance Budget

           The Major Maintenance Budget shall consist of an itemization of
           each maintenance project equal to or in excess of $ 25,000 (large
           projects) and a combined total of all items less than $ 25,000
           each (small projects) for the following calendar year. Supporting
           justification shall be included for each large project.

        D. Operating Expense Budget

           The Operating Expense Budget shall identify for the following
           calendar year the expected Operating Expenses including Direct
           Costs, Management Fee, and Major Maintenance items.

Company may at any time supplement or amend the budgets and forecasts as
necessary to carry out the purposes of this Agreement.

Section 6. EXPENDITURE AUTHORITIES

        A. Projects or Expenses not Exceeding $ 25,000

           The Operator shall have the authority to make expenditures for
           any individual capital project, major maintenance project or
           operating expense not exceeding $ 25,000 to the extent that
           Operator deems such expenditures necessary and appropriate for
           the operation or maintenance of the Facilities. The sum of any
           such expenditures may not, during any Year, exceed the amounts
           indicated for all such projects or expenses in the budget which
           has been approved by Company for that Year.

        B. Projects or Expenses in Excess of $ 25,000

           The Operator shall have the authority to make expenditures for
           any individual capital project, major maintenance project or
           operating expense in excess of $25,000 if such project or expense
           was specifically identified in an approved budget and Company has
           approved an AFE for the project. The amount of the Operator's
           authority under this subsection may be overrun by the greater of
           10% or $10,000 without seeking prior approval by Company;
           provided, however that such overrun does not cause any of the
           Capital Expenditure Forecast, Major

                                       -7-
<Page>

                        'Confidential Treatment Requested'

           Maintenance Forecast or Operating Expense Forecast approved by the
           Company to be exceeded.

        C. Emergencies

           In an emergency, the Operator may take such actions and make such
           expenditures as may be reasonably necessary, under laws, rules,
           regulations, orders or good industry practices, in order to cure
           such emergency. This shall be true whether or not the expenditure
           is within an approved budget or the action has prior approval of
           Company. In the event of such an emergency, the Operator shall
           give telephone notice or otherwise contact Company as soon as
           practicable and advise it of the circumstances of such emergency,
           the actions taken or proposed and the expenditures made,
           incurred, committed, or proposed. All expenditures made pursuant
           to this Section 6.C. shall be treated as Cash Operating Costs
           hereunder.

  Section 7. TERM

  This Agreement shall take effect as of the day and year first above written
* and shall continue until [REDACTED]

  Upon termination of this Agreement, Company shall pay Operator the amounts
  chargeable to Company hereunder as of the date of termination which have not
  already been paid by Company; Company shall also reimburse Operator for the
  full amount of any obligations or commitments Operator has made in the
  interest of performing the services hereunder in accordance with the annual
  budget and any approved projects which were not paid by Company prior to the
  date of such termination or, if agreeable to Operator, Company may assume
  such obligations or commitments. Upon termination of this Agreement,
  Operator shall turn over to Company all records, data, and information
  pertaining to operations hereunder, as well as materials, equipment,
  facilities, and operating supplies on hand which had been purchased by
  Company or in its name. Termination of this Agreement shall not affect the
  rights and privileges or duties, liabilities and obligations of either Party
  which arose or accrued prior to the date of termination.

  Section 8. INSURANCE

  Operator shall procure and maintain all insurance required by applicable law
  or regulation for operation of the Facilities, including but not limited to
  Workers' Compensation and Employer's Liability Insurance in accordance with
  all applicable state, federal, and maritime laws. Where permitted, Operator
  may fulfill its Workers' Compensation obligations by approved self-insurance
  and shall charge Company its actual costs of self-insurance which shall not
  exceed Insurance Manual Rates applicable to such operations in the place
  where the same are performed.

                                         -8-
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NEWCO will maintain its own insurance for loss or damage. No other insurance
shall be carried by Operator for the account of Company without prior approval
from Company.

Section 9. INDEMNITY

Company ("Indemnitor") shall indemnify and save harmless Operator, its
affiliates, agents and employees ("Indemnitees") in its or their role as
Operator from and against any and all loss, damage, injury, liability, expense
(including reasonable attorney's fees), and claims thereof which arise from any
injury to or death of a person, including third parties, Indemnitor, its agents
or employees, but excluding Indemnitees, from loss of or damage to property or
from penalties imposed or proceedings brought by government agencies, resulting
directly or indirectly from any operations under or pursuant to this Agreement,
including, but not limited to, the use of equipment provided by others. The
indemnity provided by Indemnitor shall remain in full force and effect
regardless of the passive, active or concurrent negligence of, and regardless of
whether liability without fault is imposed or sought to be imposed on, one or
more of the Indemnitees. However, such indemnity shall not be given effect to
the extent that such indemnity is void or otherwise unenforceable under
applicable law in effect or validly retroactive to the date of the Agreement.
Further excepted from such indemnity shall be any such loss, damage, injury,
liability or claim which is the result of the gross negligence or willful
misconduct of an Indemnitee. Operator shall give Company immediate notice of any
suit brought against Operator with respect to which Company is or may be
obligated to indemnify Operator hereunder.

Operator shall indemnify and save harmless Company, its affiliates, agents and
employees in its or their role as owner of Facilities from and against all loss,
damage, injury, liability, expense (including reasonable attorney's fees), and
claims thereof which arise from any injury to or death of agents or employees of
Operator, or from loss of or damage to property of Operator resulting directly
or indirectly from any operations under or pursuant to this Agreement. The
indemnity provided by Operator shall remain in full force and effect regardless
of the passive, active or concurrent negligence of, and regardless of whether
liability without fault is imposed or sought to be imposed on Company. However,
such indemnity shall not be given effect to the extent that such indemnity is
void or otherwise unenforceable under applicable law in effect or validly
retroactive to the date of this Agreement. Further excepted from such indemnity
shall be any such loss, damage, injury, liability or claim which is the result
of the gross negligence or willful misconduct of Company. Company shall give
Operator immediate notice of any suit brought against Company with respect to
which Operator is or may be obligated to indemnify Company hereunder.

Section 10. CONFIDENTIALITY

A.   Each Party agrees that it will maintain this Agreement, all terms and
     conditions of this Agreement and all other Confidential Information (as
     hereinafter defined) in strictest confidence and that it will not cause or
     permit disclosure of Confidential Information to

                                      -9-

<Page>

     any third Party without the express written consent of the other Party
     hereto. Disclosures of Confidential Information otherwise prohibited by
     this Section 10 may be made by either Party: (i) to the extent necessary
     for such Party to enforce its rights hereunder against the other Party;
     (ii) to the extent a Party is contractually or legally bound to disclose
     financial information to a third Party (such as a shareholder or
     commercial lender); (iii) only to the extent to which a Party hereto is
     required to disclose all or part of this Agreement by a statute or by the
     order of a Court, agency, or other governmental body exercising
     jurisdiction over the subject matter hereof, by order, by regulations, or
     by other compulsory process (including, but not limited to, deposition,
     subpoena, interrogatory, or request for production of documents); (iv) to
     the extent required by the applicable regulations of a securities or
     commodities exchange; or (v) to an Affiliate (but only if such Affiliate
     agrees to be bound by the provisions of this Section 10). "Confidential
     Information" shall mean any information proprietary to either Party and
     maintained by it in confidence or as a trade secret, including, without
     limitation, business plans and strategies, proprietary software, financing
     statements, customer or client lists, personnel records, analysis of
     general energy market conditions, sales, transportation and service
     contracts and the commercial terms thereof, relationships with current
     and potential business partners, supplies customers, service providers
     and financial sources, data base contents and valuable information of a
     like nature relating to the business of such Party. It is understood and
     agreed that Confidential Information shall not include information of a
     Party that (i) was generally available to the public at the
     time of disclosure to the other Party, (ii) after the time of disclosure
     to the other Party, becomes generally available to the public, (iii) the
     Party receiving the information can know that the information was in its
     possession at the time of disclosure, or (iv) was rightfully acquired by
     the recipient from third Persons who did not themselves obtain such
     information under a confidentiality or other similar agreement with the
     disclosing Party.

B.   If either Party is or becomes aware of a fact, obligation, or circumstance
     that has resulted or may result in a disclosure of Confidential Information
     authorized by this Section 10, it shall so notify the other Party promptly
     and shall provide documentation or an explanation of such disclosure as
     soon as it is available. Each Party further agrees to cooperate to the
     fullest extent in seeking confidential status to protect any Confidential
     Information so disclosed.

C.   The Parties hereto acknowledge that independent legal counsel may, from
     time to time, be provided with a copy of this Agreement and agree that
     such disclosure does not require consent by the other Party, provided that
     such counsel agrees to be bound by the provisions of this Section 10.

D.   Each Party will be deemed solely responsible and liable for the actions of
     its employees, independent contractors, officers, agents and Affiliates
     for maintaining the confidentiality commitments of this Section 10, but
     will be required in that regard only to exercise such care in maintaining
     the confidentiality of the Confidential Information as such Party

                                      -10-

<Page>

     normally exercises in preserving the confidentiality of its other
     commercially sensitive information.

Section 11. FORCE MAJEURE

A delay in or failure of performance of either Party hereto shall not constitute
default, nor shall either Party be held liable for loss or damage arising from
such delay or failure to the extent such delay, failure, loss or damage is
caused by Force Majeure.

The Party claiming Force Majeure as an excuse for delay in or failure of
performance shall immediately notify the other Party of the event and any steps
being taken to remove the impediment to performance.

Force Majeure shall not prevent either Party from terminating this Agreement
under Section 7.

Section 12. ASSIGNMENT

This Agreement shall be binding upon and shall inure to the benefit of the
successors and assigns of the Parties hereto; provided, however, that such
Agreement and the obligations of the Parties hereunder shall not be assignable
by either Party hereto without the express prior written consent of the other
Party hereto, except that any Party may assign this Agreement without consent,
including the performance thereof, in whole or in part to (1) an Affiliate of
the Party or the Party's shareholders; (ii) the successor of all or
substantially all the Party's business and assets; or (iii) a corporation which
such Party may merge into or be consolidated in. An assignment hereunder shall
not be effective unless and until the assignee agrees to be bound by all the
terms and conditions of this Agreement. Further, no assignment hereunder shall
relieve the assignor of any duties, liabilities or obligations accruing
hereunder before the effective date of the assignment. Any assignments
prohibited hereunder shall be void. This Agreement shall not be assignable by
operation of law and shall not become an asset in any bankruptcy or receivership
proceedings.

Section 13. NOTICES

Any notice, request, consent, approval or other similar communication of a
routine nature required or permitted under this Agreement shall be in writing
(including facsimile) and shall be deemed to have been properly given or
delivered to a Party when delivered personally to the person designated below to
receive such communication for each Party or when sent by telegram or United
States mail with postage prepaid and properly addressed to the Party to whom
given. Any such notice or other communication sent or mailed shall be deemed
given at the time it is received by the office of the individual to whom sent.
For purposes hereof the proper addresses

                                      -11-
<Page>

of the Parties (unless otherwise designated in writing which each Party may
do from time to time) shall be as follows:

     If to Company:

          Warren Petroleum Company, Limited Partnership
          13430 Northwest Freeway, Suite 1200
          Houston, Texas 77040-6095
          Attention: Vice President _______________
          Telecopy: (713) 507-_________

          with a copy to:

          Vice President & General Counsel
          Warren Petroleum Company, Limited Partnership
          13430 Northwest Freeway
          Suite 1200
          Houston, Texas 77040-6095
          Phone: (713) 507-3725
          Telecopy: (713) 507-6834

     If to Operator:

          Chevron Pipe Line Company
          1400 Woodloch Forest Drive
          The Woodlands, Texas 77380
          Attention: Corridor Team Leader

Section 14. GOVERNING LAW

The validity, nature, obligations, effect and construction of this Agreement
shall be governed by the laws of the State of Texas.

Section 15. ATTACHMENTS

Attachment I, Attachment II, and Attachment III attached hereto are incorporated
in and made a part of this Agreement. In the event of any inconsistency between
the Attachments and this Agreement, the Agreement shall control.

                                      -12-
<Page>

Section 16. GIFTS PROHIBITED

The Parties shall maintain complete and accurate records in connection with any
commission, fee, rebate, gift or entertainment of significant cost or value in
connection with the performance of this Agreement and all transactions related
thereto for at least twenty-four months from the date of invoice to Company and
Operator. No director, officer, employee or agent of any Party hereto shall
give or receive any commission, fee, rebate, gift or entertainment of
significant cost or value in connection with the performance of this Agreement.

Section 17. FEDERAL COMPLIANCE

       A.   Insofar as applicable hereto, each Party hereto shall comply with
            Executive Order No. I1246, as amended by Executive Order No.
            I1375, and the rules and regulations issued thereunder, to ensure
            that applicants are employed, and that employees are treated
            during employment without regard to their race, creed, color, sex
            or national origin. Also, if applicable, each Party hereto shall
            comply with all provisions of the Vietnam Era Veterans'
            Readjustment Assistance Act of 1974 and the rules and regulations
            issued thereunder, including 41 C.F.R., Chapter 60, Part 60-250.
            Each Party hereto shall also, if applicable, comply with all
            provisions of the Rehabilitation Act of 1973, and the rules and
            regulations issued thereunder including 41 C.F.R., Chapter 60,
            Part 60-74. Operator agrees and covenants that none of its
            employees or employees of its subcontractors who provide services
            to Company pursuant to this Agreement are unauthorized aliens as
            defined in the Immigration Reform and Control Act of 1986. All
            acts, orders, rules and regulations hereinabove referred to are
            hereby incorporated by reference unless this Agreement is
            excepted by appropriate federal law, rules, regulations or orders.

       B.   Company and Operator shall comply with all laws and regulations
            applicable to Company and Operator relating to Facilities
            hereunder, including but not limited to any regulations of the
            United States Department of Transportation applicable to
            facilities operated by Company that are connected to or a part of
            Facilities hereunder.

Section 18. SECTION HEADINGS

The headings contained in this Agreement are for reference purposes only and
shall not affect the meaning or interpretation of this Agreement.

                                      -13-
<Page>

Section 19. WAIVER

No waiver by either Party of any breach of any of the terms and conditions
contained in this Agreement shall be construed as a waiver of any subsequent
breach of the same or any other terms or conditions.

Section 20. ENTIRE AGREEMENT

This Agreement and its Exhibits constitute the sole and entire Agreement among
the Parties pertaining to the subject matter hereof. Effective as of the
commencement of the term hereof, this Agreement supersedes and cancels any and
all other prior or contemporaneous oral or written agreements or understandings
between or assumed by the Parties or any of them with respect to the foregoing
matters or any part thereof. No amendments to this Agreement shall be effective
unless in writing and executed by a duly authorized representative of each
Party.

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed
as of the day and year first above written.

COMPANY,

WARREN PETROLEUM COMPANY,
LIMITED PARTNERSHIP
BY: WARREN PETROLEUM, G.P., INC.
    ITS GENERAL PARTNER

By:  /s/ Stephen A. Furbacher
    -----------------------------

Its: PRESIDENT
    -----------------------------

OPERATOR,

CHEVRON PIPE LINE COMPANY

By:  /s/ [ILLEGIBLE]
    -----------------------------

Its: ASSISTANT SECRETARY
    -----------------------------

                                      -14-

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                        'Confidential Treatment Requested'

                                   ATTACHMENT I

                               OPERATING AGREEMENT

                              ACCOUNTING PROCEDURE

1.   DEFINITIONS

     Unless defined otherwise below, terms used in this Accounting Procedure
     shall have the same meaning as defined in the Agreement.

     "Management Fee" means the management fees referenced in Section 2.B.
     of this Attachment.

     "Person" means any individual, partnership, association, trust,
     corporation, government authority or other entity.

     "Personal Expenses" means travel expenses and other reasonable
     reimbursable expenses of employees in the operation and maintenance of
     Facilities and in any other activities required of the Operator pursuant
     to this Agreement; Operator's Affiliate(s) and employees covered under
     the Management Fee, when such Affiliates and employees perform
     activities pursuant to this Agreement.

2.   COSTS

     A.   DIRECT COSTS

          Operator shall charge Company with the following items to the
          extent such charges are incurred for the operation and maintenance
          of Facilities and in any other activities required of the Operator
          pursuant to the Agreement:

          1.   LABOR AND BENEFITS

               a.   Salaries and wages of Operator's employees (or employees
                    of Operator's Affiliate) directly assigned to the
                    operation and maintenance of Facilities, including that
                    portion of such employees' time related to ancillary
                    activities such as training required by Operator, and in
                    any other activities required of the Operator pursuant to
                    the Agreement.

               b.   Overhead related to direct labor salaries and wages, to
*                   be calculated as [REDACTED] of the amount provided for in
                    A.1.a. above.

                                     -15-
<Page>

               c.   Operator's cost of all payroll taxes, and benefits and
                    allowances and any other payment paid or contributed by
                    the Operator which is measured by Operator's employees'
                    compensation; the above to include without limitation
                    F.I.C.A., Operator's cost of holiday, vacation, sickness
                    and disability and other customary allowances, Operator's
                    current costs of established plans for employees' group
                    life insurance, hospitalization, retirement, stock
                    purchase, and other benefit plans of a like nature. Such
                    costs will be charged on a percentage assessment rate on
                    the amount of salaries and wages chargeable to the
                    Company under Paragraph 1.a. of this Section. The
                    percentage assessment rate shall be based on the
                    Operator's actual cost experience for the preceding
                    quarter and adjusted for any known modification.

          2.   EMPLOYEE EXPENSES

               a.   Reasonable Personal Expenses of those employees whose
                    salaries and wages are chargeable to the Company under
                    Paragraph 1.a. of this Section, and for which expenses the
                    employees are reimbursed under the Operator's usual
                    practices.

               b.   Reasonable Personal Expenses of those employees whose
                    activities are chargeable to the Company through the
                    Management Fee described in Section 2.B. of this
                    Attachment I, when such activities are required of the
                    Operator pursuant to the Agreement and for which expenses
                    are reimbursed under the Operator's usual practices.

          3.   MATERIALS AND SUPPLIES

               Material purchased or furnished by Operator for use in the
               operation and maintenance of Facilities shall be charged to
               the Company at the price paid by Operator after deduction of
               all discounts received. Cost of warehousing and handling
               material shall be chargeable to the Company. The accumulation
               of surplus stocks shall be avoided, and if surplus stocks are
               accumulated, such stocks shall be timely disposed of. Proceeds
               from such disposition shall be credited to the Company at the
               time they are received by Operator. Operator does not warrant
               the material furnished. In the case of material found to be
               defective, or returned to a vendor or the Operator for any
               other reason, Operator shall credit the Company when
               adjustment is received by Operator.

                                     -16-
<Page>

          4.   CONTRACTS AND SERVICES

               The cost of contracts and subcontracts, contract services
               (including those for technical personnel), professional
               consultants, equipment, and utilities employed in the
               operation and maintenance of the Facilities under the general
               direction of Operator.

          5.   EQUIPMENT FURNISHED BY OPERATOR

               a.   Use of equipment owned by Operator at rates commensurate
                    with costs of ownership and operation. Such rates shall
                    include costs of maintenance, repairs, other operating
                    expense, insurance, taxes, depreciation, and interest on
                    unrecovered investment at the prime rate charged by the
                    Citibank N.A. of New York, New York on ninety day loans
                    to substantial and responsible commercial borrowers, or
                    the maximum rate charged by law, whichever is less. In
                    lieu of rates based on costs of ownership and operation
                    of equipment, Operator may elect to use average
                    commercial rates prevailing in the immediate area of
                    Company facilities.

               b.   Whenever requested, Operator shall inform Company in
                    advance of the rates it proposes to charge.

          6.   LEGAL EXPENSES

               Expenses of investigating litigation or claims, incurred in or
               resulting from the operation and maintenance of Facilities
               under the Agreement; provided, however that no direct charge
               for services of Operator's legal staff or fees or expense of
               attorneys shall be made unless previously agreed to by
               Company. All other legal expense incurred by Operator
               hereunder is considered to covered by the overhead provisions
               of Section 2.B. below, unless otherwise agreed to by Company.

          7.   TAXES

               All taxes of every kind and nature assessed or levied upon, or
               in connection with the Company operations, property or
               Facilities and which have been paid for the benefit of
               Company, excluding any income or franchise taxes.

          8.   INSURANCE

               In accordance with Section 8 of the Agreement, net premiums
               paid for insurance required by law or by the Company to be
               carried for operation,

                                     -17-
<Page>

               maintenance and repair of Facilities and for the protection of
               the Company.

          9.   COMMUNICATIONS

               Costs of purchasing, leasing, installing, operating, and
               maintaining communications equipment and services necessary
               for the conduct of Facilities' operation and maintenance.

          10.  ECOLOGICAL AND ENVIRONMENTAL

               Costs incurred for the benefit of the Company as a result of
               statutory regulation for archeological and geophysical surveys
               relative to the identification and protection of cultural
               resources, or other ecological surveys as may be required by
               regulatory authority. Also, costs to provide or have available
               pollution containment and removal equipment, plus costs of
               actual control, cleanup and resulting responsibilities of oil
               spills as required by applicable laws and regulations.

          11.  PERMITS AND RIGHT-OF-WAY

               Costs incurred in obtaining or maintaining permits, licenses,
               leases, certificates, rights-of-way, easements, and other
               similar items necessary for the operation or maintenance of
               the Facilities.

          12.  DISMANTLING, REMOVAL, AND RESTORATIVE COSTS

               Costs incurred for dismantling, removal, and restoration of
               Company property to the extent such costs are incurred.

          13.  RENTALS

               Rentals paid by Operator for the benefit of the Company in the
               conduct of Facilities' operation and maintenance.

          14.  OTHER EXPENDITURES

               Any other expenditures directly attributable to Facilities'
               operation and maintenance not covered and dealt with in the
               foregoing provisions of this Section 2.A., and which are
               incurred by the Operator in the necessary and proper conduct
               of Facilities' operation and maintenance, and which are:

               (a)  within the scope of the Agreement and

                                     -18-
<Page>

               (b)  are included in the approved operating budget.

          15.  DISCOUNTS AND ALLOWANCES

               Operator shall take advantage of and credit to the Company all
               cash and trade discounts, freight allowances and equalization.
               annual volume and other allowances, credits, salvages,
               commissions, insurance discount dividends and retrospective
               premium adjustments, and other such items which accrue.

     B.   MANAGEMENT FEE

          The purpose of this Section 2.B. is to provide for the
          reimbursement of Operator's overhead in conjunction with services
          rendered. Operator shall charge the Company as follows to cover any
          portion of costs and expenses resulting from the performance of
          services for Facilities not otherwise chargeable under Section 2.A.
          herein:

          1.   OPERATOR'S MANAGEMENT FEE

               Operator shall receive as an annual charge, hereinafter
               referred to as "Operator's Management Fee" to cover all of
               Operator's overhead and indirect costs incurred in the
               performance of services for the Facilities. Such Operator's
               management duties hereunder shall not be subcontracted by
               Operator to any other entity, without prior approval of
               Company. The Operator's Management Fee shall be established
               pursuant to the Operating Expense Budget submitted and
               approved annually under Section 5 of the Operating Agreement.

                                     -19-
<Page>

                                 ATTACHMENT II
                              PIPELINE FACILITIES

1.   SHELL CHEM. GRADE PROPYLENE (WARREN "b"):
This 6" line runs from the Warrengas Term. @ Galena Park to Arco Jct. where
it ties into an 8" line that is leased from Shell. The segment leased from
Shell runs from Arco Jct. to the Shell tie-in @ Witter St.

-   (3.27 mi.) 17,291' of 6",.219 w.t.,1960, (Warren Pet.) This line
    segment includes 794' of pipe leased from Arco Pipe Line Co. for the
    Houston Ship Channel Crossing, referenced as the #11-8" line in the Arco
    Tunnel.
-   (1.6 mi.)8,530' of 8",no w.t.,1942, (Shell Lease Line)

2.   ARCO JCT. LINE (WARREN "c"):
This 6" line runs from Arco Jct. to Warrengas and carries various LPG'S.
-   (2.82 mi.)14,870' of 6",.219 w.t.,1954 This line segment includes 753' of
    pipe leased from Arco Pipe Line Co. for the Houston Ship Channel
    Crossing, referenced as the #2-6" line in the Arco Tunnel.

3.   GATX LINE ("c"LATERAL):
This 6" line runs from the Warrengas Terminal, under the Ship Channel and
through GATX to a connection on the Utility Line/South Route at the Port
Terminal R.R. It is used deliver various LPG'S to GATX and Crown Pet.
-   (1.84 mi.)9,714' of 6",.280 w.t.,1987

4.   UTILITY LINE (SOUTH ROUTE FROM GATX CONNECTION TO ARCO JCT.):
This 6" line is used for deliveries to Crown Pet. and as the loop back to
Warrengas Terminal from Arco Jct. through the GATX Line. (also called Arco
Jct. to Mobil in Feedstock Man.)various LPG'S
-   (2.86 mi.)15,079' of 6",.250 w.t.,1954

5.   SOUTH ROUTE (WARREN "d" AND BAYTOWN "c")
This is a 6"/8" line from Warren Mont Belvieu through Baytown and the Exxon
BOP Plant, to the Warrengas Galena Park Terminal. The channel crossing at
Warrengas is made through an 8" line laid in 1992 (de-bottleneck project)
along the GATX east fenceline and the east property line of Huntco Steel then
through one of the five lines installed in the Ship Channel Project. This
line in conjunction with the Deer Park to Texas City line delivers isobutane
from Warrengas Terminal to the Amoco and Marathon Plants in Texas City.
-  (27.2 mi.)143,625' of 6"/8",.280 w.t.,1954 (Warren South Route)

6.   CEDAR BAYOU DOCK LINE:
This is an idle 8" line that is tied into the South Route @ approx. M.P. 2
and runs southeast of Hwy. 146 to the old Mobay Plant and then west a short
distance to the Warren Cedar Bayou Dock.
-   (3.7 mi.)19,552' of 8",.250 w.t.,1956

                                     -20-
<Page>

7.   NORTH ROUTE (WARREN "e" LINE):
This is an 8" line that runs north and west from the Warren Terminal @ Mt.
Belvieu to the San Jacinto River Crossing at the Lyondell Refinery, and enters
the Warrengas Terminal from the north. This line is used to deliver various LPG
Products.
-   (24.22 mi.)127,869' of 8",.250 w.t.,1957

8.   PHIBRO LINE:
This 4" line runs from Arco Jct. through the Lyondell-Citgo Refinery, under
Sims Bayou and terminates in the Phibro Plant. This line is currently leased
to Phibro and the lease agreement stipulates that they be responsible for the
operation and maintenance of this system.
-   (2.5 mi.)13,151' of 4",.188 w.t.,1956

9.   6" PHIBRO LINE:
This 6" line runs from Arco Jct. through the Lyondell-Citgo Refinery, under
Sims Bayou and terminates in the Phibro Plant. Various LPG'S
-   (2.5 mi.)13,151' of 6",.280 w.t.,1956

10.  FANNETT TO PT. ACRES (OLD FRIO PIPELINE):
This is an 8" line that runs from the Fannett Terminal to Pt. Acres.
-   (16.18 mi.) 85405' of 8",.250 w.t.,1958

11.  TENNECO LINE (TO NITEMARE JCT.):
This 8" line runs from the Warren Mt. Belvieu Terminal, north along Hwy. 146
to Nitemare Jct. It is used to deliver and receive various LPG Products.
-   (1.01 mi.)5,316' of 8",.322 w.t.,1977

12.  ARCO #1 LINE (TO NITEMARE JCT.):
This is a 6" line that runs from the Warren Mt. Belvieu Terminal, north along
Hwy. 146 to Nitemare Jct. It is used to deliver and receive LPG Products.
-   (1.02 mi.)5,402' of 6",.250 w.t.,1956

13.  DOW PRODUCTS LATERAL:
This 6" lateral runs northwest from the Warren Mt. Belvieu Terminal, and ties
into a Dow Pipeline approx. 1,000' northwest of Winfree Rd. and the S.P.RR
Tracks. This line is in E.P. Mix Service.
-   (1.01 mi.)5,319' of 6",.432 w.t.,1972

14.  6"MAG. LINE (NITEMARE JCT.):
This is a 6" line that runs from the Warren Mt. Belvieu Terminal, north along
Hwy. 146 to nitemare jct. It is used to deliver and receive various LPG
products.
-   (1.02 mi.)5,421' of 6",.250 w.t.,1958

                                     -21-
<Page>

15.  6" OXYCHEM TIE-IN (PLACID LINE):
This is a 6" line that runs from the Warren Mt. Belvieu Terminal, north to
the Oxychem meter sta. on F.M. 1942 and Fitzgerald Rd.
-   (1.7 mi.)9.016' of 6",.280 w.t.. 1979

16.  6" ARCO BLACK LAKE LINE (PLACID LINE):
This line and the Oxychem line run parallel north to the entrance of the old
Placid Refinery. This line is used for LPG's.
-   (2.3 mi.)12.098' of 6",.280 w.t., 1979

17.  4" TEXAS PETRO-CHEM LPG LATERAL:
This is a short lateral that runs from Arco Jct. to a Texas Petro-Chem line,
within the Lyondell-Citgo Refinery. Various LPG'S
-   (.1 mi.) 829' of 4",.237 w.t.,

18.  4" UNOCAL LATERAL(INACTIVE)
This lateral is tied into the old LPG Gathering System east of Fannett Term.
-   (1.08 mi.)5,686' of 4",.237 w.t.,1989

21.  8"NATURAL GAS PIPELINE WARRENGAS TERMINAL ("A" LINE):
This line is used to transport fuel gas from a gas utility to the Warrengas
Terminal at Galena Park.
-   (1.79 mi.)9,439' of 8",.250 w.t.,1946

22.  6"/8" DEER PARK TO TEXAS CITY (STERLING) ISOBUTANE
   (ACQUIRED FROM CHEV CHEM IN 1996)
The Texas City deliveries are made through a section of the former 8"/6" Chevron
Chemical ethylene system, Texas City Leg. This segment was converted from
ethylene to Iso Butane service in April 1995 and is tied into the South Route at
sta.+ 197+90.
-   (27.35 mi.)144,436' of 8",.250 w.t.,1978 (CCCT.C. Leg to T.C. PRS)
-   (2.44 mi.)12,864' of 6",.280 w.t.,1952 (CCC T.C. PRS to Sterling)

23.  8"/6" WARREN-KOCH LINE
This is a new connection that, when completed, will provide a dedicated line
from Warren Mt. Belvieu to Koch's Meter Facility. Approx. 6,000' of new 8"
was recently laid from Warren north along Hwy. 146, then west along F.M. 1942
to tie into an existing 6,820' segment of idle 6" Placid Line. From the
tie-in point approx. 3,500' of the idle 6" will be used to connect to Koch.
-   (1.19 mi.)6,281' of 8".322 w.t.,1995 (new lay)
-   (.66 mi.)3,500' of 6",.280 w.t.,1979 (idle segment to be used)
-   (.63 mi.)3,320' of 6",.280 w.t.,1979 (idle 6" not used)

                                     -22-
<Page>

25.  8" CEDAR BAYOU TO WARREN LPG
     (FROM LINE # 27 CONNECTION TO WARREN MT. BELVIEU)
This line is connected to Line # 27 on the east side of Cedar Bayou at the HL&P
corridor. The line runs northeast within the CPL 200' ROW, crosses the Southern
Pacific RR. (2 8"lines in a 24"casing.1 spare line) then enters the Warren
Property at the west fenceline. The line runs north along the fence to a point
just past the west gate, where it enters a swab trap and ties into the 8"sch.80
plant piping that Warren installed through the pipe rack.
-   (.79 mi.)4,158' of 8",.312 w.t. 1991 (CPL installed section)

26.  20" LPG IMPORT PIPELINE (ACQUIRED FROM CPL IN 1996)
A 20" OD x 0.344" wall thickness pipeline that runs 25.3 miles in Harris and
Chambers Counties from Warrengas - Galena Park to Warren Mont Belvieu Terminal
Storage Facility. Built in 1977. There are no intermediate connections or pump
stations on this pipeline. Warren furnishes pumping equipment at Galena Park and
Mont Belvieu.

27. 8" PRODUCTS PIPELINE (ACQUIRED FROM CPL IN 1996)
An 8" OD x 0.250" wall thickness pipeline that runs 23.5 miles in Harris and
Chambers Counties from Warrengas Galena Park - to Chevron Chemical Cedar Bayou
Plant with one interconnection to a Warren-owned pipeline at Cedar Bayou. Built
in 1957. Pumping is furnished by Warren at Galena Park and by Chevron Chemical
at Cedar Bayou.

                                     -23-
<Page>

                                ATTACHMENT III

                               MAP OF FACILITIES

                                     -24-<Page>

                                                                   Exhibit 10.14

"Pages where confidential treatment has been requested are marked 'Confidential
Treatment Requested.' The redacted material has been separately filed with the
Commission, and the appropriate section has been marked at the appropriate place
and in the margin with a star (*)."

                     NATURAL GAS LIQUIDS PURCHASE AGREEMENT

     THIS NATURAL GAS LIQUIDS PURCHASE AGREEMENT (this "Agreement") is made
and entered into effective the 1st day of February, 2002, by and between DYNEGY
LIQUIDS MARKETING AND TRADE, a Delaware partnership with offices at 1000
Louisiana, Suite 5800, Houston, TX 77002 (hereinafter referred to as "Dynegy"),
and TEXACO EXPLORATION AND PRODUCTION INC. ("TEPI"), a Delaware corporation with
offices at 1301 McKinney Street, Houston, TX 77010 and TEXACO NATURAL GAS INC.
("TNGI"), a Delaware corporation with offices at 1301 McKinney Street, Houston,
TX 77010, but only to the extent TNGI continues to control the NGLs (as such
term is defined hereinafter) owned by Four Star Oil and Gas Company ("Four
Star") (TEPI and TNGI are sometimes hereinafter collectively referred to as
"Texaco").

                                  WITNESSETH:

     WHEREAS, Texaco has quantities of NGLs available for sale from certain gas
processing plants and fractionation plants that it desires to sell to Dynegy,
and Dynegy desires to purchase such NGLs from Texaco.

     NOW, THEREFORE, in consideration of the premises and for the mutual benefit
of the Parties as well as for other good and valuable consideration, Dynegy and
Texaco agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

     1.1 As used in this Agreement, the following terms shall have the following
meanings:

         ACCOUNTING PERIOD shall mean a period of one (1) month commencing at
         12:01 a.m. local time on the first day of a calendar month and ending
         at 12:01 a.m. local time on the first day of the next succeeding month.

         AFFILIATE shall mean any Person that directly or indirectly through one
         or more intermediaries, controls or is controlled by or is under common
         control with the Person specified. The term "control" (including the
         terms "controlled by" or "under common control with") means the
         possession, directly or indirectly, of the power to direct or cause the
         direction of the management and policies of a Person, whether through
         ownership, by contract, or otherwise. Any Person shall be deemed to be
         an Affiliate of any specified Person if such Person owns 50% or more of
         the voting securities of the specified Person, if the specified Person
         owns 50% or more of the voting securities of such Person, or if 50% or
         more of the voting securities of the specified Person and such Person
         are under common control.

         ALTERNATE INDEX shall have the meaning specified in Section 5.3 of this
         Agreement.

<Page>

         BANKRUPTCY EVENT shall mean the occurrence of one or more of the
         following events with respect to a Party: (A) the entry of a decree or
         order for relief against a Party by a court of competent jurisdiction
         in any involuntary case brought against a Party under any bankruptcy
         insolvency or other similar law (collectively, "Debtor Relief Laws")
         generally affecting the rights of creditors and relief of debtors now
         or hereafter in effect, (B) the appointment of a receiver, liquidator,
         assignee, custodian, trustee, sequestrator, or other similar agent
         under applicable Debtor Relief Laws for a Party or for any substantial
         part of its assets or property, (C) the ordering of the winding up or
         liquidation of a Party's affairs, (D) the filing of a petition in any
         such involuntary bankruptcy case, which petition remains undismissed
         for a period of 180 days or which is not dismissed or suspended
         pursuant to Section 305 of the Federal Bankruptcy Code (or any
         corresponding provision of any future United States bankruptcy law),
         (E) the commencement by a Party of a voluntary case under any
         applicable Debtor Relief Law now or hereafter in effect, (F) the
         consent by a Party to the entry of an order for relief in an
         involuntary case under any such law or to the appointment of or the
         taking of possession by a receiver, liquidator, assignee, trustee,
         custodian, sequestrator or other similar agent under any applicable
         Debtor Relief Laws for a Party or for any substantial part of its
         assets or property, or (G) the making by a Party of any general
         assignment for the benefit of its creditors.

         BARREL shall mean forty-two (42) U.S. Gallons.

         BASE RATE shall mean the lesser of (i) two percent (2%) above the per
         annum rate of interest announced from time to time as the "prime rate"
         for commercial loans by Bank One, Chicago, as such "prime rate" may
         change from time to time, or (ii) the maximum applicable non-usurious
         rate of interest.

         BUSINESS DAY shall mean a day on which Federal Reserve member banks in
         New York City are open for business.

         COMPONENT(S) shall mean the individual hydrocarbon constituents of Raw
         NGL Mix, including, but not limited to, Propane, Normal Butane,
         Isobutane, Natural Gasoline and Ethane.

         DAY OR DAILY (and day or daily) shall mean a twenty-four (24) hour
         period commencing 12:01 a.m. local time and extending until 12:01 a.m.
         local time on the following day.

         DELIVERY POINT(S) shall have the meaning specified in Section 6.2 of
         this Agreement.

         DISPUTE NOTICE shall have the meaning specified in Section 13.2 of this
         Agreement.

         EFFECTIVE DATE shall mean February 1, 2002.

         EPO DELIVERY POINTS shall have the meaning specified in Section 4.2.1
         of this Agreement.

                                       2
<Page>

         ETHANE shall mean a liquid hydrocarbon stream which meets the ethane
         specifications set forth in Exhibit "A", or the ethane specifications
         of the fractionator where such Fractionated NGL is produced, if
         fractionated at a stand-alone fractionator.

         FRACTIONATED NGLS shall mean liquid hydrocarbons fractionated from Raw
         NGL Mix, including, but not limited to, Propane, Normal Butane,
         Isobutane, Natural Gasoline and Ethane.

         GALLON shall mean the unit of volume used for the purpose of
         measurement of liquid. One (1) U.S. liquid Gallon contains two hundred
         thirty-one (231) cubic inches when the liquid is at a temperature of
         sixty degrees Fahrenheit (60 DEG. F) and at the vapor pressure of the
         liquid being measured.

         ISOBUTANE shall mean a liquid hydrocarbon stream which meets the
         isobutane specifications set forth in Exhibit "A", or the isobutane
         specifications of the fractionator where such Fractionated NGL is
         produced, if fractionated at a stand-alone fractionator.

         MONTH OR MONTHLY (and month or monthly) shall mean a period commencing
         at 12:01 a.m. local time on the first day of a calendar month and
         extending until 12:01 a.m. local time on the first day of the next
         succeeding calendar month.

         MIXED BUTANE shall mean a liquid hydrocarbon stream which meets the
         specifications of the pipeline utilized to transport same or, if trucks
         are utilized to transport such Mixed Butanes, the mixed butane
         specifications set forth in Exhibit "A".

         NATURAL GASOLINE shall mean a liquid hydrocarbon stream which meets the
         natural gasoline specifications set forth in Exhibit "A", or the
         natural gasoline specifications of the fractionator where such
         Fractionated NGL is produced, if fractionated at a stand-alone
         fractionator.

         NETBACK PRICE shall mean the price obtained by Dynegy in an arm's
         length sale of NGLs to a third Person who is not an Affiliate of
         Dynegy, or in a sale under an existing TEPI or TNGI contract
         administered by Dynegy as TEPI's or TNGI's agent, less Transportation
         Costs and/or T&F Costs that are reasonably incurred in connection
         therewith.

         DYNEGY DEFICIENCY QUANTITY shall have the meaning specified in Section
         14.1 of this Agreement.

         NEW TAXES shall mean any Taxes enacted and effective after the
         Effective Date, including that portion of any Taxes or New Taxes that
         constitutes an increase either in rate or breadth of coverage.

         NGL shall mean Raw NGL Mix, if delivered to Dynegy from a gas
         processing plant, or Fractionated NGLs, if delivered to Dynegy from a
         fractionator.

         NORMAL BUTANE shall mean a liquid hydrocarbon stream which meets the
         normal butane specifications set forth in Exhibit "A", or the normal
         butane specifications of the

                                       3
<Page>

         fractionator where such Fractionated NGL is produced, if fractionated
         at a stand-alone fractionator.

         OFFSPEC NGLS shall have the meaning specified in Section 7.1 of this
         Agreement.

         PARTY shall mean individually either Texaco or Dynegy (including their
         respective successors and permitted assigns), collectively, the
         "PARTIES."

         PERSON shall mean any individual, corporation, partnership, limited
         liability company, association, joint venture, trust, or other
         organization of any nature or kind.

         PROPANE shall mean a liquid hydrocarbon stream which meets the propane
         specifications set forth in Exhibit "A", or the propane specifications
         of the fractionator where such Fractionated NGL is produced, if
         fractionated at a stand-alone fractionator.

         RAW NGL MIX shall mean the mixed liquid hydrocarbon stream produced at
         a gas processing plant and delivered to Dynegy at the Delivery Point at
         the tailgate of said plant meeting the specifications of the pipeline
         utilized to transport same or, if trucks are utilized to transport such
         Raw NGL Mix, such Raw NGL Mix shall meet the demethanized raw product
         specifications set forth in Exhibit "A".

         TAXES shall mean any and all ad valorem, property, occupation,
         severance, production, extraction, first use, conservation, Btu or
         energy, gathering, transport, pipeline, utility, gross receipts, gas or
         oil revenue, gas or oil import, privilege, sales, use, consumption,
         excise, lease, transaction, environmental, and other taxes,
         governmental charges, duties, licenses, fees, permits, and assessments.

         T&F COSTS shall mean all Transportation Costs and the costs and
         expenses incurred in connection with the receipt and fractionation of
         NGLs received by Dynegy from Texaco or that would have been incurred if
         fractionated, including any loss allowance imposed at the applicable
         fractionator. Fractionation of Texaco's NGLs at any facility other
         than the EPO Fractionator (as defined in Section 4.2) shall be subject
         to separate negotiations, the final decision of which shall be agreed
         upon by Texaco. T&F costs shall include any shrinkage and loss
         allowance, if any, charged by the pipeline and/or fractionator utilized
         to transport and fractionate, as applicable, Texaco's Raw NGL Mix
         and/or Fractionated NGLs.

         TRANSPORTATION COSTS shall mean all costs and expenses reasonably
         incurred in connection with the transportation of NGL(s) hereunder,
         including, without limitation, pipeline, rail car, barges, and truck
         costs, NGL losses that occur during transportation for reasons other
         than the negligence or willful misconduct of Dynegy and all costs and
         expenses reasonably incurred in loading, unloading, transporting,
         terminaling, storing (if required), and handling such NGLs. With
         respect to barges, trucks and any other modes of transportation owned
         by Dynegy or its Affiliates, the applicable Transportation Costs shall
         not exceed the fair market value of the use of such modes of
         transportation in transporting NGLs hereunder. In those situations when
         it is necessary to transport NGLs

                                       4
<Page>

         by truck or rail cars to a pipeline receipt point, such costs shall be
         included as part of the Transportation Costs. It is understood and
         agreed that Transportation Costs shall not include any portion of
         Dynegy's general and administrative costs and expenses.

         YEAR (and year) shall mean a period of twelve (12) consecutive months
         commencing from the Effective Date.

     1.2 Other Definitions. Other terms may be defined elsewhere in the text of
this Agreement and shall have the meanings indicated throughout this Agreement.

                                   ARTICLE II
                         REPRESENTATIONS AND WARRANTIES

     2.1 Texaco hereby represents and warrants to Dynegy that on and as of the
date hereof:

         (a)      It has all requisite corporate power and authority to carry on
                  the business in which it is engaged and to perform its
                  respective obligations under this Agreement;

         (b)      The execution and delivery of this Agreement have been duly
                  authorized and approved by all requisite corporate action;

         (c)      It has all the requisite corporate power and authority to
                  enter into this Agreement and perform its obligations
                  hereunder;

         (d)      The execution and delivery of this Agreement does not, and
                  consummation of the transactions contemplated herein will not,
                  violate any of the material provisions of its organizational
                  documents, any material agreement pursuant to which Texaco or
                  its properties are bound or, to its knowledge, any material
                  laws applicable to Texaco; and

         (e)      This Agreement is valid, binding, and enforceable against it
                  in accordance with its terms, subject to bankruptcy,
                  moratorium, insolvency, and other laws generally affecting
                  creditor's rights and general principles of equity (whether
                  applied in a proceeding in a court of law or equity).

     2.2 Dynegy hereby represents and warrants to Texaco that on and as of
the date hereof:

         (a)      It has all requisite power and authority to carry on the
                  business in which it is engaged and to perform its respective
                  obligations under this Agreement;

         (b)      The execution and delivery of this Agreement have been duly
                  authorized and approved by all requisite partnership action;

                                       5
<Page>

         (c)      It has all the requisite power and authority to enter into
                  this Agreement and perform its obligations hereunder;

         (d)      The execution and delivery of this Agreement does not, and
                  consummation of the transactions contemplated herein will not,
                  violate any of the material provisions of its organizational
                  documents, any material agreement pursuant to which Dynegy or
                  its properties are bound or, to its knowledge, any material
                  laws applicable to Dynegy; and

         (e)      This Agreement is valid, binding, and enforceable against it
                  in accordance with its terms, subject to bankruptcy,
                  moratorium, insolvency, and other laws generally affecting
                  creditor's rights and general principles of equity (whether
                  applied in a proceeding in a court of law or equity).

                                   ARTICLE III
                                      TERM

     3.1 Unless otherwise provided herein, this Agreement shall remain in full
force and effect from February 1, 2002 through August 31, 2006 (the "Primary
Term"), and shall continue in effect from year to year thereafter unless
terminated by either Party hereto at the end of the Primary Term or any yearly
anniversary thereafter by giving the other Party at least ninety (90) days, but
not more than one hundred twenty (120) days, advance written notice of its
intention to so terminate.

     3.2 Notwithstanding Section 3.1 above, this Agreement may be terminated as
follows:

         (a)      By the non-defaulting Party, upon thirty (30) days written
                  notice to the other Party, after it has been determined
                  through the dispute resolution procedures of Article XIII that
                  a Material Default has occurred in the performance of a
                  Party's obligations hereunder (it being understood that, for
                  purposes of the foregoing, "Material Default" shall mean that
                  the arbitrators have determined that (i) in consequence of
                  such default, the objectives of this Agreement are not being
                  met and (ii) the defaulting Party failed to take the steps
                  necessary to accomplish such objectives);

         (b)      In the event either Party is dissolved (unless the successor
                  to such dissolved Party or its assets is an Affiliate of
                  Texaco or Dynegy, Inc.);

         (c)      If a Bankruptcy Event occurs with respect to either Party; or

         (d)      By Texaco as provided in Section 11.2 of this Agreement.

     3.3 Upon the termination of this Agreement, any monies due and owing either
Party shall be paid to the other Party pursuant to the terms hereof and any
refunds due either Party shall be made at the earliest possible time, and in any
event no later than sixty (60) days after the

                                       6
<Page>

expiration or termination of this Agreement. All audit rights shall survive for
the period prescribed by Section 11.6.

     3.4 Termination of this Agreement hereunder shall be cumulative of any
other rights or remedies that the terminating Party may have in connection with
such termination, including, but not limited to, damages and injunctive
relief.

                                   ARTICLE IV
                                    QUANTITY

     4.1 During the term of this Agreement, unless Dynegy is excused from
purchasing NGLs, or Texaco is excused from selling NGLs pursuant to the terms
and provisions hereof or in Exhibits "B", "C" or "D", Texaco agrees to sell
to Dynegy, and Dynegy agrees to purchase from Texaco, all of Texaco's right,
title and interest in the NGLs produced at the processing or fractionation
plants (the "Plants") listed in Exhibits "B", "C" and "D" which are attached
hereto and made a part hereof, not otherwise committed to Dynegy or any of
its Affiliates ("Texaco's NGLs"), provided, however, this Agreement shall not
be deemed a dedication of leases or properties behind such Plants and nothing
contained herein shall prevent or preclude Texaco from selling or otherwise
disposing of any interest it has in (a) the leases or properties behind such
plants or (b) the plants themselves. Notwithstanding the foregoing, any
transfers of leases and/or interest from Texaco to Chevron U.S.A. Inc. or any
of its Affiliates shall remain subject to this Agreement. It is understood
and agreed that TNGI and TEPI shall not be required to sell to Dynegy
pursuant to this Agreement any NGLs that are committed to an agreement in
effect prior to the Effective Date hereof between TNGI or TEPI and any third
party (a "Pre-existing Agreement"), it being further understood and agreed
that Dynegy will administer any such Pre-existing Agreements on behalf of
TNGI or TEPI and will be entitled to receive from TNGI a mutually agreeable
administration fee for administering each such agreement until such agreement
is either (a) terminated, or (b) assigned to Dynegy (with Dynegy's consent),
at which point the NGLs previously committed to such Pre-existing Agreement
shall be sold to Dynegy under this Agreement.

     4.2 The provisions of this Section 4.2 are applicable only to Raw NGL Mix
produced at one or more of the Plants and delivered for fractionation to the
fractionator operated by Enterprise Products Operating Company ("EPO") situated
in Mont Belvieu, Texas (the "EPO Fractionator").

     4.2.1 Texaco and Dynegy acknowledge that (i) the Raw NGL Mix produced at
one or more of the Plants may be dedicated and/or delivered to the EPO
Fractionator, (ii) with respect to such Raw NGL Mix fractionated at the EPO
Fractionator, Texaco will retain title to such Raw NGL Mix, cause such Raw NGL
Mix to be fractionated at the EPO Fractionator and cause the resulting
Fractionated NGLs to be delivered to Dynegy, at Dynegy's election, at the
tailgate of the EPO Fractionator, at the outlet of the storage facility utilized
in connection with the operation of the EPO Fractionator, or at any delivery
point where Texaco has the right to receive Fractionated NGLs from the EPO
Fractionator (the "EPO Delivery Points"), and (iii) for product distribution
purposes, Texaco will designate Dynegy to act as Texaco's agent under the
agreement governing the fractionation of Texaco's Raw NGL Mix at the EPO
Fractionator

                                       7
<Page>

pursuant to a mutually agreeable agency agreement. Such agency agreement will
grant to Dynegy the broadest authority that Texaco can grant related to the
distribution of Fractionated NGLs. As agent, Dynegy will be required to use the
same care in acting on Texaco's behalf that Dynegy would use in conducting its
own commercial activities. Until such time as (y) the agency agreement
referenced in (iii) above is entered into and (z) the operator of the EPO
Fractionator acknowledges Dynegy's rights under such agency agreement, Texaco
will continue to perform scheduling and logistic functions associated with the
Raw NGL Mix fractionated at the EPO Fractionator and will sell to Dynegy the
Fractionated NGLs produced from Texaco's Raw NGL Mix at the EPO Delivery Points.
During this time period, Texaco will provide full time day-to-day distribution
assistance to Dynegy sufficient to insure Dynegy's ability to effectively market
the Fractionated NGLs and maximize the distribution options in a manner
consistent with industry trading practices in Mont Belvieu, Texas.

     4.2.2 Until such time as the agency agreement referenced in Section 4.2.3
below is fully effective, in order to determine the volumes of NGLs sold to
Dynegy each month, on or prior to the 25th day of the month during the month
NGLs are to be delivered to Dynegy hereunder (the "Month of Nomination"), Texaco
shall nominate in writing or by e-mail to Dynegy the total volumes of each
Fractionated NGL Texaco expects to deliver to Dynegy at the EPO Delivery Points
during such month (the "Nominated Volumes"). If the 25th day of the month falls
on a day that is not a Business Day, such nominations shall be made on the
immediately preceding Business Day prior to such non-Business Day. If the actual
volumes of Fractionated NGLs delivered to Dynegy during a particular Month of
Nomination are more or less than the Nominated Volumes applicable for such Month
of Nomination, the volumes in excess of, or less than, the Nominated Volumes
will be sold to or purchased from Dynegy in a balancing transaction, based on
the applicable price during the month immediately following the Month of
Nomination.

     4.2.3 If, upon the sale of Texaco's interest in the EPO Fractionator,
Texaco is able to make Dynegy its agent under the new agreement governing the
fractionation of Texaco's Raw NGL Mix and the delivery of the Fractionated NGLs
resulting therefrom, Dynegy and Texaco will enter into a mutually acceptable
agency agreement pursuant to which Dynegy will be responsible for coordinating
all movements of Raw NGL Mix from the field plant locations through the
appropriate pipelines and gathering systems and scheduling the Raw NGL Mix to
the EPO Fractionator. Dynegy will also be responsible for arranging with the
operator of the EPO Fractionator for Dynegy to take title to, and custody of,
the Fractionated NGLs downstream of the fractionator, at which point Dynegy will
purchase the Finished Product from Texaco as provided above. As agent, Dynegy
will be required to use the same care in acting on Texaco's behalf that Dynegy
would use in conducting its own commercial activities. Dynegy will not receive
any additional payment for these agency services beyond those fees set forth in
this Agreement.

     4.2.4 Notwithstanding anything in this Agreement to the contrary, it is
understood and agreed that the quantity of NGLs fractionated in the EPO
Fractionator and purchased each month by Dynegy from Texaco pursuant to this
Agreement will be the Fractionated NGLs available for sale at the tailgate of
the EPO Fractionator. It is further understood and agreed that Dynegy shall not
be responsible for any prior month adjustments to Texaco's allocated volumes of
Raw NGL

                                       8
<Page>

                      'Confidential Treatment Requested'

Mix and/or Fractionated NGLs due to plant reallocations, true-ups or for any
other reasons outside of Dynegy's control. Each Party shall notify the other
Party immediately of any such adjustments and the Parties will take appropriate
actions to verify the accuracy thereof and contest any adjustments that do not
appear to be justified.

     4.3 Texaco and Dynegy acknowledge that the marketing of Texaco's Raw NGL
Mix and Fractionated NGLs by Dynegy is mutually beneficial to both parties.
Accordingly, Texaco and Dynegy agree that, if in the future Texaco has
uncommitted Raw NGL Mix and/or Fractionated NGLs not otherwise subject to this
Agreement available for sale, Texaco and Dynegy will endeavor in good faith
determine the appropriate exhibit and/or pricing basis for such uncommitted Raw
NGL Mix and/or Fractionated NGLs and, if an agreement is reached, shall amend
this Agreement accordingly.

     4.4 The Parties shall use every reasonable effort to deliver and receive,
as applicable, NGLs on a ratable daily basis.

                                    ARTICLE V
                                      PRICE

     5.1 Except as otherwise provided herein, Dynegy shall pay TEPI for the NGLs
purchased from TEPI hereunder as follows:

         (a)      For the volumes of NGLs produced at the Plants listed in
                  Exhibit "B", and delivered to Dynegy at the applicable
                  Delivery Point at (i) the tailgate of such Plants for
                  subsequent transportation by pipeline or for exchange to Mont
                  Belvieu, Texas, or (ii) at the EPO Delivery Points, a price
*                 equal to the [REDACTED] as quoted by the Oil Price
                  Information Service ("OPIS") for Mont Belvieu, Texas
                  (Non-TET) for the month in which NGLs are delivered to
                  Dynegy, less (1) applicable T&F Costs and distribution fees
                  charged by the fractionator and/or storage operator
                  ("Distribution Fees"), unless Fractionated NGLs are
                  delivered to Dynegy at the EPO Delivery Points, in which
                  case the T&F Costs and Distribution Fees will be paid
*                 directly by TEPI, and (2) an administration fee of [REDACTED]
                  per gallon. Notwithstanding the foregoing, (y) Ethane shall
*                 be priced based on the [REDACTED] as quoted by OPIS
                  (Non-TET) at Mont Belvieu, Texas, when the Raw NGL Mix
                  produced at the Plants is fractionated at the EPO
                  Fractionator, but otherwise shall be priced based on
*                 [REDACTED] as quoted by OPIS (Non-TET) at Mont Belvieu, if,
                  for any reason, the Raw NGL Mix is fractionated at Cedar
                  Bayou Fractionators in Mont Belvieu, Texas, and (z) Propane
*                 shall be priced based on [REDACTED] as quoted by OPIS at
                  Mont Belvieu (TET), unless such Propane can not be delivered
                  into TET for any reason outside of Dynegy's control, in
                  which event, such Propane shall be priced based on the
*                 [REDACTED] as quoted by OPIS at Mont Belvieu, Texas
                  (Non-TET). Dynegy agrees to notify TEPI as soon as reasonably

                                       9
<Page>

                        'Confidential Treatment Requested'

                  possible whenever Propane can not be delivered into TET for
                  any reason outside of Dynegy's control.

         (b)      For the volumes of NGLs produced and delivered to Dynegy at
                  the tailgate of the Maysville or Patrick Draw Plants, and
                  immediately resold into a local market, the price shall be
*                 [REDACTED] of the Netback Price. Dynegy shall not make local
                  sales from any of the Plants listed in Exhibit "B" other
                  than the Maysville and Patrick Draw Plants, or substantially
                  increase the percentage of available NGLs sold into local
                  markets from the Maysville or Patrick Draw Plants, unless
                  Dynegy in good faith expects such sales to produce a better
                  economic result for TEPI, after all associated costs and
                  fees paid to Dynegy, than the Mont Belvieu alternative and
                  TEPI has given its written consent to such additional local
                  market sales as hereinafter provided. If Dynegy becomes
                  aware of an opportunity to make local sales of NGLs from the
                  Plants listed on Exhibit "B" other than the Maysville and
                  Patrick Draw Plants, or to increase local sales from the
                  Maysville or Patrick Draw Plants, at a price expected to
                  produce more net revenue for TEPI than the price referenced
                  in Section 5.1(a), Dynegy shall advise TEPI of such
                  opportunity and TEPI shall determine whether its other
                  contractual commitments and other considerations permit it
                  to take advantage of the local market opportunity. As to any
                  such additional local market sales entered into by Dynegy
                  with TEPI's written consent, the price payable to TEPI
*                 hereunder shall be [REDACTED] of the Netback Price. In the
                  event actual experience over any twelve month period
                  beginning after the Effective Date shows that such local
                  sales from any Plant listed on Exhibit "B" do not produce
                  better economic results for TEPI, TEPI may revoke or reduce
                  the local sale authority previously granted for any Plant
                  with a Mont Belvieu sale option; provided that any existing
                  third party commitments made by Dynegy may be honored during
                  their remaining term. Should TEPI exercise its option to
                  require such a reduction, during the Primary Term of this
                  Agreement, in local sales volume from the Maysville or
                  Patrick Draw Plants below the Historical Annual Gallons
                  stipulated in the table below, Dynegy will be compensated by
                  TEPI for the resulting reduction in Dynegy's expected
                  revenues, according to the following formula:

*                 [REDACTED]

                  Where:

                  AP = the payment due to Dynegy for the 12-month period
                  following any revocation of local sales authority by TEPI

                  HAG = Historical Annual Gallons of local sales from Maysville
                  and Patrick Draw, which for purposes of this formula are
                  stipulated to be as follows:

<Table>
<Caption>

PLANT                                          PRODUCT                      HISTORICAL ANNUAL
                                                                                  GALLONS
-----------------------------------------------------------------------------------------------------
<S>                                            <C>                          <C>

</Table>

                                       10

<Page>

                                 'Confidential Treatment Requested'

<Table>
<S>                                       <C>                                    <C>
  -----------------------------------------------------------------------------------------------------
*           Maysville                           Isobutane                          [REDACTED]
  -----------------------------------------------------------------------------------------------------
*           Maysville                         Normal Butane                        [REDACTED]
  -----------------------------------------------------------------------------------------------------
*           Maysville                       Field Grade Butane                     [REDACTED]
  -----------------------------------------------------------------------------------------------------
*           Maysville                        Natural Gasoline                      [REDACTED]
  -----------------------------------------------------------------------------------------------------
*           Maysville                            Propane                           [REDACTED]
  -----------------------------------------------------------------------------------------------------
*          Patrick Draw                      Natural Gasoline                      [REDACTED]
  -----------------------------------------------------------------------------------------------------
*          Patrick Draw                          Propane                           [REDACTED]
  -----------------------------------------------------------------------------------------------------
</Table>

                  NAG = the gallons of each NGL product anticipated to be sold
                  in the local market during the immediately succeeding twelve
                  month period as a result of and in accordance with TEPI's
                  revocation or reduction of local sales authority, which shall
                  be calculated by subtracting from the total gallons of each
                  NGL product sold in the local market during the immediately
                  preceding twelve month period, the volumes of each NGL product
                  affected by TEPI's reduction and/or revocation of local sales
                  authority. If all of the volumes of a particular NGL product
                  are affected by such reduction or revocation, the volumes so
                  affected shall be based on the gallons of such NGL product
                  sold in the local market during the immediately preceding
                  twelve month period.

                  APG = Assumed Price per Gallon, which for purposes of this
                  formula is stipulated to be as follows:

<Table>
<Caption>

                       PRODUCT                                   ASSUMED PRICE PER GALLON
  -----------------------------------------------------------------------------------------------------
  <S>                                                                    <C>
*                     Isobutane                                          [REDACTED]
  -----------------------------------------------------------------------------------------------------
*                   Normal Butane                                        [REDACTED]
  -----------------------------------------------------------------------------------------------------
*                 Field Grade Butane                                     [REDACTED]
  -----------------------------------------------------------------------------------------------------
*                  Natural Gasoline                                      [REDACTED]
  -----------------------------------------------------------------------------------------------------
*                      Propane                                           [REDACTED]
  -----------------------------------------------------------------------------------------------------
</Table>

                  As soon as possible after the end of any twelve month period
                  following an election by TEPI to require a reduction in local
                  sales volumes from the referenced Plants, Dynegy shall invoice
                  TEPI for any compensatory payment due to Dynegy under this
                  Section, and payment shall be made by TEPI, subject to Section
                  11.3 hereof, within 30 days after receipt of Dynegy's invoice.
                  Dynegy may continue to calculate and invoice TEPI for such
                  compensatory payments on an annual basis during the Primary
                  Term of this Agreement unless TEPI subsequently authorizes
                  local sales from such Plants at a level at least as high as
                  the Historical Monthly Gallons stipulated above. Any payments
                  calculated under this formula shall be prorated for any
                  calculation period that includes less than twelve months due
                  to the expiration of the Primary Term.

         (c)      For any volumes of NGLs delivered to Dynegy at the applicable
                  Delivery Point at the tailgate of the Plants listed in Exhibit
*                 "C", [REDACTED] of (i) the Netback Price, if such NGLs are
                  immediately sold by Dynegy into a local market, or (ii) a
*                 price equal to [REDACTED] as quoted by OPIS for

                                       11
<Page>

                         'Confidential Treatment Requested'

                  Mont Belvieu, Texas (Non-TET), less T&F Costs to and at Mont
*                 Belvieu, Texas, less an administrative fee of [REDACTED] per
                  Gallon, if such Raw NGL Mix or Fractionated NGLs are stored
                  by Dynegy for its own account during the applicable delivery
                  month. Dynegy shall use every reasonable effort to obtain
                  the highest Netback Price for any NGLs sold at a Netback
                  Price.

         (d)      For any exchanges of Raw NGL Mix, the Price will be determined
                  based on the location where Dynegy receives Fractionated NGLs,
                  less all applicable T&F costs, less any exchange fees paid by
                  Dynegy, plus any exchange fees received by Dynegy, less
*                 an administrative fee of [REDACTED] per Gallon.

         (e)      TEPI shall remain responsible for any exchange and/or delivery
                  imbalances until such time as the TEPI exchange agreements are
                  assigned to Dynegy, and subsequent to such assignment, Dynegy
                  shall be responsible for all exchange and/or delivery
                  imbalances accruing subsequent to the assignment.

     5.2 Except as otherwise provided herein, Dynegy shall pay TNGI for NGLs
produced by Four Star and delivered to Dynegy under this Agreement a price as
set forth on Exhibit "D".

     5.3 With respect to the Raw NGL Mix delivered by or on behalf of Texaco to
Dynegy, the prices set forth in Sections 5.1 or 5.2 above shall be based on the
Components contained in the Raw NGL Mix delivered to Dynegy at the tailgate of
the applicable processing Plant, less applicable T&F costs and other fees as
set forth in Section 5.1 above.

     5.4 If for any reason the OPIS index for a particular NGL should cease to
be published, the Parties shall promptly and in good faith endeavor to negotiate
a mutually satisfactory Alternate Index or substitute methodology for
calculating the price for such NGL (the "Alternate Index"). If, on or before
thirty (30) days after the index used to determine the price ceases to be
published, the Parties are unable to agree on an Alternate Index upon which to
base the calculation of the price, the Parties shall submit such determination
to dispute resolution in accordance with the provisions of Article XIII of this
Agreement, which arbitration procedure will determine the Alternate Index. From
the date on which the index price used to determine the price for a particular
NGL ceases to be available until the Alternate Index is determined, the price
for such NGL shall be the average of the prices in effect (or that would have
been in effect) during the twelve (12) months preceding the month in which the
index upon which the price was based ceased to be available, which price shall
be effective until the effective date of the Alternate Index determined as set
forth in this Section 5.3. Upon the determination of an Alternate Index, the
price will be adjusted retroactively to the date on which the index upon which
the price previously was based ceased to be available, plus interest thereon at
the Base Rate.

     5.5 In the event conditions change such that this Agreement causes, or
could reasonably be expected to cause, a material long term economic or
operational hardship to either Party, upon the written request of either Party,
Texaco and Dynegy shall meet to renegotiate in good faith such burdensome terms
and provisions so as to make them fair and equitable. Such renegotiations shall
occur within thirty (30) days of the date of the non-requesting Party's receipt

                                       12
<Page>

of such written request for such renegotiations. If the Parties are unable to
agree on new provisions to replace such burdensome terms and provisions within
ninety (90) days of the nonrequesting Party's receipt of such written request,
the matter shall be submitted to the dispute resolution procedures set forth in
Article XIII hereof. It is understood and agreed that the rights granted in this
Section 5.5 can only be used by a Party to commence good faith renegotiations
once during each year during the term hereof. If new or revised provisions are
agreed upon under this Section 5.5, whether by renegotiation, arbitration, or
otherwise, such new or revised provisions shall be effective as of, and shall,
if necessary, be made retroactive to, the date on which the notice commencing
renegotiations under this Section 5.5 was given. In the event such new or
revised provisions are determined to be effective retroactively and result in
money owing from one Party to the other, such amount owing shall bear interest
at the Base Rate.

                                   ARTICLE VI
                                   DELIVERIES

     6.1 The NGLs to be sold by Texaco hereunder shall be delivered by Texaco
(or at Texaco's direction) to Dynegy or to Dynegy's designated representative
for the account of Dynegy, at the Delivery Points (as defined in Section 6.2).

     6.2 The point(s) of delivery for NGLs sold and delivered hereunder
(hereinafter the "Delivery Point(s)") shall be determined as follows:

         (a)      In the event delivery is to be to or from a pipeline, the
                  Delivery Point shall be located, and delivery of NGLs shall be
                  deemed to occur, at the point at which such NGLs pass the
                  pipeline meter. If pipeline delivery is by in-line inventory
                  transfer, delivery shall be deemed to occur on the date and
                  time that the relevant pipeline carrier advises Texaco and
                  Dynegy, by product transfer order, book transfer, or letter of
                  transfer, that NGLs have been transferred to Dynegy's account,
                  and the Delivery Point shall be the location of the NGLs in
                  the pipeline of the pipeline carrier on the day and time that
                  such in-line transfer of NGLs is deemed to occur. The Parties
                  hereto understand and agree that Dynegy has no control over
                  the operations of the pipeline carrier and therefore cannot
                  control when NGLs are transferred to Dynegy's account by the
                  pipeline carrier, or if such a transfer will, in fact, occur.

         (b)      In the event delivery is to be by or into a rail car, truck,
                  or barge owned, operated, leased, or hired by Dynegy, the
                  Delivery Point shall be located, and delivery of NGLs shall be
                  deemed to occur, at the point at which the NGLs pass from the
                  flange connecting the loading facility to Dynegy's owned,
                  operated, leased, or hired rail car, truck, or barge whether
                  said rail car, truck, or barge is loaded by Texaco or Dynegy
                  directly or on behalf of Texaco or Dynegy through Texaco's or
                  Dynegy's agent.

         (c)      Consistent with contractual commitments that now exist or may
                  be made in the future by Texaco, the Delivery Point for all
                  NGLs attributable to the Plants listed on Exhibit "B" shall be
                  the EPO Delivery Points, except where (i) certain NGLs

                                       13
<Page>

                  were committed to other contracts or locations by Texaco prior
                  to the Effective Date, (ii) local sales from such Plants are
                  specifically authorized on Exhibit "B", or (iii) Texaco, after
                  the Effective Date, consents in writing to alternate
                  arrangements for such NGLs

     6.3 Title to and risk of loss (other than those losses described in Section
6.4 (f) of this Agreement) associated with the NGLs delivered hereunder shall
pass from Texaco to Dynegy upon the commencement of the delivery of such NGLs at
the Delivery Points. Nothing contained in this Section 6.3 shall in any way
affect Dynegy's rights as set forth in Article VII or Texaco's indemnity set
forth in Section 7.2 of this Agreement. Except as otherwise provided in Section
7.2 of this Agreement, Dynegy shall indemnify and save Texaco harmless against
any claims for damages and losses arising from injuries to persons or property
attributable to the NGLs delivered hereunder after delivery thereof has been
made to Dynegy; conversely, Texaco shall indemnify and hold Dynegy harmless
against any claims for damages and losses arising from injuries to persons or
property attributable to the NGLs prior to delivery. In addition, each of the
Parties (Dynegy and Texaco) hereto shall indemnify and hold the other harmless
from any losses and damages arising out of the operations conducted hereunder by
such indemnifying Party to the extent resulting from the negligent acts or
willful misconduct of such indemnifying Party, its agents or its employees.

     6.4 The following rules shall be applicable to the transportation and
loading of NGLs at the Delivery Point(s) situated at facilities neither owned
nor operated by Dynegy:

         (a)      The loading of NGLs at the applicable Delivery Point(s) shall
                  be performed in accordance with schedules mutually agreed to
                  by the Parties.

         (b)      If rail cars subject to payment of demurrage or any other
                  similar charges to a third Person not affiliated with either
                  Party are used to transport NGLs from the Delivery Point, the
                  Party responsible for loading such cars agrees to load or
                  cause to be loaded and start the relevant cars on the return
                  trip in accordance with the detention policy of the owner or
                  operator of such rail car equipment and such Party further
                  agrees to pay any and all such charges that may be due
                  thereunder.

         (c)      Texaco shall be liable for the payment of invoices from the
                  railroad for demurrage and hazardous materials storage charges
                  incurred by Dynegy as the prepaid shipper due to Texaco's
                  inability to receive a rail car and/or have a rail car placed
                  on Texaco's siding, unless such charges are incurred as a
                  result of Dynegy's negligence.

         (d)      If Dynegy's owned or leased trucks are used to transport NGLs
                  from the Delivery Point, Texaco agrees to load such trucks
                  upon arrival at the Delivery Point, and Texaco's failure to do
                  so in a timely manner shall render Texaco liable to Dynegy for
                  any actual damages incurred as a result of such delay.
                  Notwithstanding the foregoing, Texaco shall have the right
                  to refuse to load any truck that fails to meet Department of
                  Transportation or other applicable laws, rules, regulations or
                  standards.

                                       14
<Page>

         (e)      For NGLs purchased hereunder (other than in the situation when
                  a Netback Price is paid which will be based on actual volumes
                  sold), Texaco will be liable for all tank car shortages
                  claimed by Dynegy in excess of one percent (1%) of the net
                  Gallons reflected on the bill of lading and acknowledged by
                  the railroad agent's signature prior to unloading; provided,
                  however, that such shortages, if any, are reported in writing
                  to Texaco within seventy two (72) hours after delivery by the
                  carrier and prior to the unloading of the shipment in which
                  the relevant shortage occurs. Dynegy shall ask Texaco for
                  permission to unload, and Texaco, at its expense, shall have
                  the right to inspect each car at its destination within forty
                  eight (48) hours after receipt of written notice of such
                  shortage. All demurrage charges arising from the failure of
                  Texaco to release the car for unloading within such
                  forty-eight (48) hour period shall be paid by Texaco.
                  Similarly, Texaco shall be liable for all truck shortages
                  claimed by Dynegy in excess of three percent (3%) of the net
                  Gallons reflected on the bill of lading; provided, however,
                  that such shortages, if any, are noted on the delivery ticket
                  and acknowledged by the truck driver's signature prior to
                  unloading. The failure of Dynegy to observe this provision or
                  any action by Dynegy which impedes identification of an
                  alleged defect shall operate as a waiver of Dynegy's rights to
                  make any such claim.

     6.5 Notwithstanding anything contained herein to the contrary, Texaco shall
be allowed to consolidate its deliveries of NGLs behind one or more Delivery
Points so long as (i) sufficient notice is provided Dynegy and (ii) such
consolidation does not result in an economic or operational hardship on Dynegy.

                                   ARTICLE VII
                                     QUALITY

     7.1 All NGLs sold by Texaco and purchased by Dynegy hereunder shall meet
the applicable specifications as referenced in the definitions in Article I of
this Agreement of each type of NGL and shall not contain any contaminates or
other deleterious substances. Except as otherwise provided in Section 7.2,
Dynegy shall have the right to reject any NGLs which fail to meet such quality
specifications ("Offspec NGL"). All costs associated with the return, disposal
and/or treatment of Offspec NGL shall be borne by Texaco.

     7.2 Should the NGLs delivered hereunder to Dynegy, or to Dynegy's
designated representative for the account of Dynegy, fail at any time to conform
to the applicable specifications, either Party shall notify the other Party of
any such failure, and Texaco immediately shall undertake and diligently pursue
such acts as may be necessary to correct such failure so as to deliver NGLs
conforming to such specifications; but nothing contained in this Article VII
shall be construed to limit Dynegy's right, at any time and from time to time,
to reject any NGL not conforming to said specifications and to refuse or suspend
receipt until it is established to Dynegy's reasonable satisfaction that
subsequent deliveries of NGLs will conform to said specifications.
Notwithstanding the foregoing, Dynegy shall not have the right to reject (a)
Offspec NGLs produced at and delivered from a processing or fractionation plant
operated by Dynegy, unless caused by Texaco's negligence, or (b) Offspec NGLs
that can be sold by Dynegy

                                       15
<Page>

in the normal course of business under terms that do not result in adverse
economic consequences to Dynegy. The term of this Agreement shall not be
extended by the length of time of any period or periods when deliveries have
been rejected, refused, or suspended as provided for herein. The knowing
acceptance by Dynegy of Offspec NGL shall constitute a waiver by Dynegy of any
and all other rights and remedies available to Dynegy under this Agreement or
otherwise with respect to Texaco's tender of such Offspec NGL, and all risk of
loss, damage or liability arising out of Dynegy's ownership, control,
possession, or use of such Offspec NGLs shall pass to and be borne by Dynegy. If
it is subsequently determined that Dynegy unknowingly accepted Offspec NGLs, the
Parties will mutually agree upon a discounted price for such Offspec NGLs to
reflect their diminution in value, if any, from NGLs meeting the specifications
hereof. If the Parties are unable to agree on a mutually acceptable discount
price for such Offspec NGLs, the matter shall be subjected to the dispute
resolution procedures set forth in Article XIII hereof Texaco agrees to
INDEMNIFY and HOLD HARMLESS Dynegy, its Affiliates, and their respective
officers, directors, employees, agents, and contractors, from all actual losses,
costs, expenses, claims (including, without limitation, personal injury or
property damage claims), damages, and causes of action, including, without
limitation, reasonable attorneys' fees and costs of court (collectively, the
"Losses") incurred by Dynegy, such Persons, or such Affiliates arising out of,
or in any way associated with, the delivery to Dynegy of NGLs that fail to meet
the applicable specifications and which are unknowingly accepted by Dynegy.
Notwithstanding the foregoing, Dynegy shall not be entitled to a discounted
price for (a) any Offspec NGLs produced at and delivered from a processing or
fractionation plant owned and/or operated by Dynegy if, immediately prior to the
Effective Date of this Agreement, such Dynegy owned or operated plant was
producing, or if not then producing, was capable of producing, NGLs that meet
the applicable specifications, unless caused by Texaco's negligence, or (b)
Offspec NGLs that can be sold by Dynegy in the normal course of business under
terms that do not result in adverse economic consequences to Dynegy.

     7.3 From time to time during the term hereof, Dynegy may request Texaco to
provide certain NGLs that exceed the normal specifications as set forth in
Exhibit "A" ("Purity NGLs"). The Parties acknowledge that providing such Purity
NGLs may be to the mutual benefit of both Parties and that neither Party should
suffer an economic loss as a result thereof.

                                  ARTICLE VIII
                                WARRANTY OF TITLE

     8.1 Texaco warrants title to all NGLs sold and delivered by it to Dynegy,
and further warrants that Texaco has the right to sell such NGLs and that such
NGLs are free from all liens, mortgages, security interests, encumbrances and
adverse claims or other charges. Texaco shall be responsible for paying all
royalties, production payments, payments to other working interest owners,
overriding royalties, taxes, license fees or other charges on the NGLs (other
than taxes, license fees or other charges applicable to Dynegy's share of the
NGLs) and Texaco agrees to and does hereby indemnify and save Dynegy (including
its directors, officers, employees, agents, representatives, affiliates and
subsidiaries) harmless from and against any and all claims, suits, causes of
action, debts, accounts, damages, losses, costs and expenses (including
reasonable attorney's fees) arising out of or in any way connected with (i) any
adverse title and/or warranty claims to the NGLs, or (ii) the payment of
royalties, overriding royalties, production payments

                                       16
<Page>

and payments to other working interest owners, if any. THERE ARE, HOWEVER, NO
OTHER WARRANTIES OF ANY KIND WHATSOEVER, EITHER EXPRESS OR IMPLIED, INCLUDING,
WITHOUT LIMITATION, ANY WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE,
MERCHANTABILITY, CONFORMITY TO MODELS OR SAMPLES, OR OTHERWISE, AND ALL SUCH
WARRANTIES ARE HEREBY EXPRESSLY DISCLAIMED BY Texaco AND EXCLUDED FROM THIS
AGREEMENT.

                                   ARTICLE IX
                                      TAXES

     9.1 Texaco shall be liable for and shall pay, or cause to be paid, or
reimburse Dynegy, if Dynegy has paid, all Taxes applicable to the processing of
gas and the recovery of the NGLs sold hereunder upstream of the Delivery
Point(s). If Dynegy is required to remit such Tax, the amount thereof shall be
deducted from any sums becoming due to Texaco hereunder and shall be itemized on
the statement provided by Dynegy in accordance with Section 11.1. Dynegy shall
be liable for and shall pay, cause to be paid, or reimburse Texaco, if Texaco
has paid, all Taxes applicable to the sale and/or delivery of NGLs hereunder at
and downstream of the Delivery Point(s) including any Taxes imposed or collected
by a taxing authority with jurisdiction over Dynegy, provided, however, when
laws, ordinances or regulations permit or impose upon Texaco the obligation to
collect or pay Taxes applicable to the sale and/or delivery of NGL hereunder at
the Delivery Point, Texaco shall collect all such Taxes from Dynegy, which shall
be in addition to the applicable Price, and remit the same to the appropriate
governmental authority, unless Dynegy furnishes a certificate of exemption.
TEXACO SHALL INDEMNIFY, DEFEND, AND HOLD DYNEGY HARMLESS FROM AND AGAINST ANY
LIABILITY WITH RESPECT TO THE TAXES FOR WHICH TEXACO IS LIABLE AND DYNEGY SHALL
INDEMNIFY, DEFEND, AND HOLD TEXACO HARMLESS FROM AND AGAINST ANY LIABILITY WITH
RESPECT TO THE TAXES FOR WHICH DYNEGY IS LIABLE.

     9.2 Each Party will notify the other of the enactment of any New Taxes as
promptly as practical after it obtains knowledge thereof. It is understood and
agreed that the enactment of any material New Taxes shall constitute a hardship
under the provisions of Section 5.4 above.

     9.3 To claim an exemption from payment of a Tax, a Party shall provide a
certificate of exemption or other reasonably satisfactory evidence of exemption
from any Tax, and each Party agrees to cooperate with the other Party in
obtaining any such exemption. In addition, Dynegy has provided Texaco with, and
Texaco acknowledges receipt of, the disclosure statement from Dynegy (as set
forth in Section 4101 of the Internal Revenue Code of 1986).

                                    ARTICLE X
                            MEASUREMENT AND ANALYSES

     10.1 On all deliveries into or out of rail cars, the quantity shall be
determined by official tank car capacity tables or slip tube gauges in
accordance with GAS PROCESSORS ASSOCIATION ("GPA") PUBLICATION 8162, latest
revision. On all deliveries into or out of truck equipment, quantities shall be
determined by meter, rotary gauge, weighing, or other measuring

                                       17
<Page>

devices that meet industry standards, in accordance with GPA PUBLICATIONS
8162 AND 8186, latest revision. On all deliveries into or out of pipelines,
quantities shall be determined by pipeline meter in accordance with the
American Petroleum Institute ("API") Manual of Petroleum Measurement
Standards. For raw make mixtures, volumes of the Components shall be
determined (where practical) on a mass (pound) measurement basis in
accordance with the latest edition of GPA PUBLICATIONS 8173 AND 8182. On all
deliveries into or out of shore tanks, quantities shall be determined either
by meter or gauge from a static tank in accordance with the API Manual of
Petroleum Measurement Standards and based upon the practice of the relevant
terminal. All quantities shall be corrected to standard conditions of sixty
degrees Fahrenheit (60 DEG. F) and equilibrium vapor pressure in accordance
with the API Manual of Petroleum Measurement Standards, Chapter 14, Section
B. The quantity and quality of NGLs covered by this Agreement shall be
measured according to the current versions of the applicable standards of API
and the American Society for Testing Materials, if available. Each Party
shall be entitled to have its representatives present during all loadings,
unloadings, tests, and measurements involving NGLs delivered hereunder. If
the Parties cannot agree on measurement or quality tests results, the
measurements and quality tests required to determine the volume of receipts
or shipments or the conformity of the NGLs delivered to the specifications
set forth herein shall be made by an independent inspector selected jointly
by the Parties, the cost of which shall be shared equally by the Parties.

                                   ARTICLE XI
                               BILLING AND PAYMENT

     11.1 By not later than thirty (30) days following the month NGLs are
produced in a gas processing or fractionation plant operated by Dynegy or
fifteen (15) Business Days after Dynegy's receipt of the Operator's Statement or
other applicable statements covering delivery of the NGLs to Dynegy at the
Delivery Points, setting forth the required actual (as opposed to estimated)
volume information, or ten (10) days following the end of the month in which
NGLs are sold in the situation where a Netback Price is applicable, Dynegy shall
provide Texaco with a statement setting forth the volumes of NGLs received, the
price or Netback Price, as applicable, of such NGLs, the amount due Texaco for
such NGLs, and such other information and detail as may be mutually agreeable to
the Parties, along with payment for such NGLs, which shall be remitted by wire
transfer of funds into an account designated by Texaco. If the day on which any
payment is due is not a Business Day, then the relevant payment shall be due
upon the immediately preceding Business Day, except if such payment due date is
a Sunday or Monday, then the relevant payment shall be due upon the immediately
succeeding Business Day. Dynegy's statements rendered hereunder shall itemize
separately the NGLs owned by Four Star, controlled by TNGI, and sold under this
Agreement. TNGI shall provide to Dynegy, on a timely basis, such information as
may be necessary to facilitate preparation of such itemized statements.

     11.2 If either Party should fail to remit any amounts in full when due as
required hereunder, or if any adjustments are made under this Agreement,
including, without limitation, adjustments as the result of the conclusion of
any audits or as a result of the resolution of a billing dispute, interest on
the unpaid portion shall accrue from the date upon which such payment should
have been made hereunder until paid in full at the Base Rate. All such accrued
interest shall be added to the amount reflected as being owed hereunder by
either Dynegy or

                                       18
<Page>

Texaco, as the case may be, on the next invoice or by separate invoice. In
addition, if Dynegy falls to pay any amount due, as reflected in Dynegy's
statement, within ten (10) days after the due date, or if Dynegy fails to
provide a statement as required by Section 11. 1 above, Texaco shall have the
right, upon written notice to Dynegy, to (i) immediately suspend any further
deliveries of NGLs until such statement has been provided and all amounts due,
including interest at the Base Rate, have been paid, and (ii) to provide notice
to Dynegy that this Agreement shall terminate if such statement is not provided
and the payment default has not been cured within sixty (60) days after the date
such written notice is received by Dynegy.

     11.3 If a good faith dispute arises as to the amount payable in any
statement, the amount not in dispute shall be paid. If either Party elects to
withhold any payment otherwise due as a consequence of the good faith dispute,
the withholding Party shall provide the other Party with written notice of its
reasons for withholding payment, and shall simultaneously place the disputed
amount into an escrow account at a mutually acceptable commercial bank, pending
resolution of the dispute. Any such dispute shall be resolved in accordance with
the dispute resolution procedures of Article XIII. The performance of both
Parties under this Agreement shall continue pending the outcome of such
procedures. If it is subsequently determined, whether by mutual agreement of the
Parties or otherwise, that the withholding Party is required to pay all or any
portion of the disputed amounts to the other Party, the withholding Party, in
addition to paying over such amounts, shall also pay interest accrued on such
amounts from the original due date through the date actually paid, at the Base
Rate.

     11.4 No retroactive adjustments may be made for any overcharge or
undercharge after a period ending twenty-four (24) months from the end of the
month in which the NGL invoice or statement forming the basis of the overcharge
or undercharge was delivered or not delivered, as the case may be, unless a
claim for such adjustment shall have been presented prior to the end of such
period. Any payment with respect to a retroactive adjustment shall include an
amount equal to interest on all amounts past due from the original due date
through the date actually paid at the Base Rate, except in instances where
neither Party knew that the overcharge or undercharge occurred, in which case
interest shall run from the date of demand for payment.

     11.5 Either Party, upon notice in writing to the other, shall have the
right at reasonable' hours to audit the accounts and records of the other Party,
and any relevant records of third parties as to which a Party hereto has the
right to grant access, relating to the accounting or billing under the
provisions of any article hereof; provided, however, that the auditing Party
must take written exception to and make claim upon the other Party for all
discrepancies disclosed by said audit within twenty-four (24) months of the
rendition of any statement or invoice forming the basis of such claim. Such
audit shall be conducted by the auditing Party's representative or auditor at
the auditing Party's expense.

     11.6 ALL DISPUTES ARISING UNDER THIS ARTICLE XI THAT ARE NOT OTHERWISE
RESOLVED AS PROVIDED HEREIN SHALL BE SUBMITTED TO THE DISPUTE RESOLUTION
PROCEDURES AS SET FORTH IN ARTICLE XIII HEREOF. TO THE EXTENT THAT ANY SUCH
UNRESOLVED DISPUTE HAS NOT BEEN SUBMITTED TO SUCH DISPUTE RESOLUTION PROCEDURES
WITHIN TWENTY-FIVE (25)

                                       19
<Page>

MONTHS AFTER THE EVENT CAUSING THE DISPUTE IS DISCOVERED OR REASONABLY SHOULD
HAVE BEEN DISCOVERED, THE PARTY ASSERTING THE CLAIM IN DISPUTE SHALL BE DEEMED
TO HAVE WAIVED ANY SUCH CLAIM AND ALL RIGHTS HEREUNDER WITH RESPECT THERETO.

11.7 All payments will be made without set off or counterclaim; provided,
however, that upon a Party's (the "defaulting Party") failure to make payment of
undisputed amounts on the due date, the other Party (the "non-defaulting Party")
may, at its option and in its sole discretion, set off against any amounts owed
to the defaulting Party, any amounts owed by the defaulting Party under this
Agreement or otherwise. The obligations of the non-defaulting Party and the
defaulting Party under this Agreement in respect of such amounts shall be deemed
satisfied and discharged to the extent of any such set off. The non-defaulting
Party will give the defaulting Party notice of any set off made under this
Section 11.7 as soon as practicable after the set off is made, provided that
failure to give such notice shall in no way affect the validity of the set off

                                   ARTICLE XII
                                  FORCE MAJEURE

     12.1 In the event either Party is rendered unable, wholly or in part, by
Force Majeure to carry out its obligations under this Agreement, other than the
obligation to make payment of money due hereunder, it is agreed that upon such
Party's giving notice and reasonably full particulars of such Force Majeure in
writing to the other Party after the occurrence of the cause relied on, then the
obligations of the Party giving such notice, so far as and to the extent that
they are affected by such Force Majeure, shall be suspended during the
continuance of any inability so caused, but for no longer period, and such cause
shall so far as possible be remedied with all reasonable dispatch. This
Agreement shall not be terminated by reason of any such cause, but shall remain
in full force and effect, and this Agreement shall not be extended regardless of
such curtailment or cessation.

     12.2 The term "Force Majeure" as used herein shall mean acts of God,
strikes, lockouts, or other industrial disturbances, acts of the public enemy,
wars, blockades, insurrections, riots, epidemics, landslides, lightning,
earthquakes, fires, tornadoes, hurricanes, or storms, tornado, hurricane, or
storm warnings which in any Parties' judgment require the precautionary shutdown
of a gas processing plant or other related facilities, floods, washouts, arrests
or restraints of the government, either federal or state, civil or military,
civil disturbances, explosions, sabotage, breakage or accident to equipment,
machinery or lines of pipe, freezing of machinery, equipment, wells, or lines of
pipe, electric power shortages, failure of pipelines or carriers to transport,
partial or entire failure of wells, inability of any Party to obtain necessary
permits and/or permissions due to existing or future rules, orders, laws or
governmental authorities (both federal, state and local), temporary cleaning or
testing of facilities (including, but not limited to, scheduled gas processing
facility turnarounds and shutdowns for safety maintenance), shutdowns due to
explosion or other extraordinary incident, or any other causes, whether of the
kind herein enumerated or otherwise, and which are not within the control of the
Party claiming suspension and which such Party is unable to overcome by the
exercise of due diligence. It is understood and agreed that the settlement of
strikes or lockouts shall be entirely

                                       20
<Page>

within the discretion of the Party having the difficulty, and that the above
requirement that any Force Majeure shall be remedied with all reasonable
dispatch shall not require the settlement of strikes or lockouts by acceding to
the demands of opposing Parties when such course is inadvisable in the
discretion of the Party having difficulty. The term "Force Majeure" shall also
include any event of Force Majeure occurring with respect to the facilities or
services of either Texaco's or Dynegy's third Party suppliers or customers
delivering or receiving any product, fuel, feedstock, or other substance
necessary to the performance of such Party's obligations, and shall also include
curtailment or interruption of deliveries or service by such third Party
suppliers or customers as a result of an event of Force Majeure.

                                  ARTICLE XIII
                          DISPUTE RESOLUTION PROCEDURES
                          -----------------------------

     13.1 Any dispute arising out of or relating to this Agreement shall be
resolved in accordance with the procedures specified in this Article XIII, which
shall be the sole and exclusive procedures for the resolution of any such
disputes, and the Parties hereby expressly waive all rights to have any such
disputes heard before a court of law, except the right to enforce an arbitration
award as described hereinafter.

     13.2 The Parties shall attempt in good faith to resolve any dispute arising
out of or relating to this Agreement promptly by negotiation between executives
who have authority to settle the controversy and who are at a higher level of
management than the persons with direct responsibility for administration of
this contract. Any Party may give the other Party written notice of any dispute
(a "Dispute Notice") not resolved in the normal course of business. Within 15
days after delivery of a Dispute Notice, the receiving Party shall submit to the
other a written response. The Dispute Notice and the response shall include (a)
a statement of each Party's position and a summary of arguments supporting that
position, and (b) the name and title of the executive who will represent that
Party and of any other person who will accompany the executive. Within 30 days
after delivery of the disputing Party's Dispute Notice, the executives of both
Parties shall meet at a mutually acceptable time and place, and thereafter as
often as they reasonably deem necessary, to attempt to resolve the dispute. All
reasonable requests for information made by one Party to the other will be
honored. All negotiations pursuant to this clause are confidential and shall be
treated as compromise and settlement negotiations for purposes of applicable
rules of evidence.

     13.3 If the dispute has not been resolved by negotiation within 45 days
after delivery of the disputing Party's Dispute Notice, or if the Parties failed
to meet within 30 days, the Parties shall endeavor to settle the dispute by
mediation under the then current CPR Mediation Procedure. Unless otherwise
agreed, the Parties will select a mediator from the CPR Panels of Distinguished
Neutrals.

     13.4 Any dispute arising out of or relating to this contract including the
breach, termination or validity thereof which has not been resolved by a
non-binding procedure as provided herein within 90 days after the initiation of
such procedure, shall be settled by arbitration in accordance with the CPR Rules
for Non-Administered Arbitration in effect on the date of this agreement, by
three arbitrators, none of whom shall be appointed by either Party;

                                       21
<Page>

provided, however, that if either Party will not participate in a non-binding
procedure, the other may initiate arbitration before expiration of the above
period. The arbitration shall be governed by the Federal Arbitration Act, 9
U.S.C. Sections 1-16, and judgment upon the award rendered by the
arbitrator(s) may be entered by any court having jurisdiction thereof. The
place of arbitration shall be Houston, Texas. The arbitrator(s) are not
empowered to award damages in excess of compensatory damages and each Party
expressly waives and foregoes any right to punitive, exemplary or similar
damages unless a statute requires that compensatory damages be increased in
specified manner.

     13.5 The statute of limitations of the State of Texas applicable to the
commencement of a lawsuit shall apply to the commencement of an arbitration
hereunder, except that no defenses shall be available based upon the passage of
time during any negotiation or mediation called for by the preceding paragraphs
of this Article XIII, which shall be deemed to have commenced on the date the
receiving Party receive a Dispute Notice from the disputing Party.

                                   ARTICLE XIV
                              LIMITATION OF DAMAGES
                              ---------------------

     14.1 Unless performance is excused by another provision of this Agreement,
if Dynegy fails to accept delivery of all quantities of NGLs tendered by Texaco
that Dynegy is obligated to receive during the term of this Agreement, Dynegy
shall pay to Texaco, within ten (10) days after Dynegy's receipt of Texaco's
invoice therefor, an amount equal to the sum of the following amounts: (a) the
arithmetic product obtained by multiplying (i) the difference between the
quantity of NGLs actually accepted by Dynegy and the quantity of NGLs tendered
by Texaco (the "Dynegy Deficiency Quantity") by (ii) the positive difference, if
any, obtained by subtracting from the price that Dynegy would have otherwise
paid as provided herein, an amount derived from (1) the price obtained by Texaco
in an arms-length sale to a third party of a quantity of NGLs sold by Texaco, up
to or equal to the amount of the Dynegy Deficiency Quantity, less (2)
incremental transportation and storage costs incurred by Texaco; PLUS (b) an
amount, as liquidated damages, equal to one quarter of one cent per Gallon
($0.0025/Gallon) multiplied by the Dynegy Deficiency Quantity to cover Texaco's
administrative and operational costs and expenses.

     14.2 FOR BREACH OF ANY PROVISION FOR WHICH AN EXPRESS REMEDY OR MEASURE OF
DAMAGES IS PROVIDED IN THIS AGREEMENT, SUCH EXPRESS REMEDY OR MEASURE OF DAMAGES
SHALL BE THE SOLE AND EXCLUSIVE REMEDY HEREUNDER, AND THE OBLIGOR'S LIABILITY
SHALL BE LIMITED AS SET FORTH IN SUCH PROVISION, AND ALL OTHER REMEDIES OR
DAMAGES ARE WAIVED. IF NO REMEDY OR MEASURE OF DAMAGES IS EXPRESSLY PROVIDED
HEREIN, THE OBLIGOR'S LIABILITY SHALL BE LIMITED TO DIRECT ACTUAL DAMAGES ONLY,
EXCLUDING LOST PROFITS, AND SUCH DIRECT ACTUAL DAMAGES SHALL BE THE SOLE AND
EXCLUSIVE REMEDY HEREUNDER, AND ALL OTHER REMEDIES OR DAMAGES ARE WAIVED. IN NO
EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY UNDER ANY PROVISION OF
THIS AGREEMENT (INCLUDING, WITHOUT LIMITATION, ANY INDEMNITY PROVISION HEREOF)
FOR PUNITIVE OR

                                       22
<Page>

EXEMPLARY DAMAGES IN TORT OR CONTRACT. EXCEPT AS EXPRESSLY PROVIDED HEREIN,
NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY UNDER ANY PROVISION OF THIS
AGREEMENT FOR CONSEQUENTIAL, INCIDENTAL, OR INDIRECT DAMAGES. THE PRECEDING
SENTENCE SHALL NOT BE CONSTRUED AS LIMITING THE OBLIGATION OF EITHER PARTY
HEREUNDER TO INDEMNIFY THE OTHER PARTY AGAINST CLAIMS ASSERTED BY THIRD
PARTIES, INCLUDING, BUT NOT LIMITED TO, THIRD PARTY CLAIMS FOR CONSEQUENTIAL,
INCIDENTAL, OR INDIRECT DAMAGES, BUT EXCLUDING CLAIMS FOR SUCH DAMAGES UNDER
ARTICLE IX. TO THE EXTENT ANY PAYMENT REQUIRED TO BE MADE PURSUANT TO ANY
PROVISION OF THIS AGREEMENT IS AGREED BY THE PARTIES TO CONSTITUTE LIQUIDATED
DAMAGES, THE PARTIES ACKNOWLEDGE THAT THE DAMAGES ARE DIFFICULT OR IMPOSSIBLE
TO DETERMINE, AND THAT SUCH PAYMENT CONSTITUTES A REASONABLE APPROXIMATION OF
THE AMOUNT OF SUCH DAMAGES.

                                   ARTICLE XV
                                  MISCELLANEOUS
                                  -------------

     15.1 This Agreement and the operations hereunder shall be subject to the
valid and applicable federal and state laws and the valid and applicable
orders, laws, local ordinances, rules, and regulations of any local, state or
federal authority having jurisdiction, but nothing contained herein shall be
construed as a waiver of any right to question or contest any such order,
laws, rules, or regulations in any forum having jurisdiction in the premises.
If any provision of this Agreement is held to be illegal, invalid, or
unenforceable under the present or future laws effective during the term of
this Agreement, (i) such provision will be fully severable, (ii) this
Agreement will be construed and enforced as if such illegal, invalid, or
unenforceable provision had never comprised a part of this Agreement, and
(iii) the remaining provisions of this Agreement will remain in full force
and effect and will not be affected by the illegal, invalid, or unenforceable
provision or by its severance from this Agreement. Furthermore, in lieu of
such illegal, invalid, or unenforceable provision, there will be added
automatically as a part of this Agreement a provision similar in terms to
such illegal, invalid, or unenforceable provision as may be possible and as
may be legal, valid, and enforceable. If a provision of this Agreement is or
becomes illegal, invalid, or unenforceable in any jurisdiction, the foregoing
event shall not affect the validity or enforceability in that jurisdiction of
any other provision of this Agreement nor the validity or enforceability in
other jurisdictions of that or any other provision of this Agreement.

     15.2 THIS AGREEMENT AND THE RIGHTS AND DUTIES OF THE PARTIES ARISING OUT
OF THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED, ENFORCED, AND PERFORMED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, AS THE SAME MAY BE AMENDED
FROM TIME TO TIME, WITHOUT GIVING EFFECT TO ANY CHOICE OR CONFLICT OF LAW
PROVISION OR RULE THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY
JURISDICTION OTHER THAN THE STATE OF TEXAS.

                                       23
<Page>

     15.3 This Agreement, including, without limitation, all exhibits hereto,
integrates the entire understanding between the Parties with respect to the
subject matter covered and supersedes all prior understandings, drafts,
discussions, or statements, whether oral or in writing, expressed or implied,
dealing with the same subject matter. This Agreement may not be amended or
modified in any manner except by a written document signed by both Parties
that expressly amends this Agreement. No waiver by Texaco or Dynegy of any of
the provisions of this Agreement shall be deemed or shall constitute a waiver
of any other provision hereof (whether or not similar) nor shall such waiver
constitute a continuing waiver unless expressly provided. No waiver shall be
effective unless made in writing and signed by the Party to be charged with
such wavier. The delay or failure on the part of a Party to insist, in any
one instance or more, upon strict performance of any of the terms or
conditions of this Agreement, or to exercise any right or privilege herein
conferred, shall not be construed as a waiver of any such terms, conditions,
rights or privileges, and the same shall continue and remain in full force
and effect.

     15.4 The terms, covenants and conditions of this Agreement shall inure
to and be binding upon the Parties hereto and their successors and permitted
assigns; provided, however, that neither Party may assign this Agreement in
whole or in part without the prior written consent of the other Party, which
consent shall not be unreasonably withheld, and provided further, that either
Party may assign its rights hereunder to any Affiliate without the approval
of the other Party, but any such assignment shall in no way relieve or
release such assigning Party from any obligations hereunder, whether accrued
or unaccrued, unless agreed to in writing by the non-assigning Party; further
provided that each Party may, for collateral purposes, mortgage, pledge,
encumber or grant a security interest in or a lien on its interest in this
Agreement and/or its rights hereunder to any commercial bank, trustee or
other Person acting on behalf of any such commercial bank without the consent
of the other Party. Any transfer or assignment in violation of this Section
shall be void.

     15.5 Dynegy acknowledges that there may be hazards associated with the
loading, unloading, transporting, handling, or use of the NGL sold hereunder,
which may require that warning be communicated to or other precautionary
action taken with all Persons handling, coming into contact with, or in any
way concerned with the NGLs sold hereunder. Dynegy assumes as to its
employees, independent contractors, and subsequent purchasers of the NGLs
sold hereunder all responsibility for all such necessary warnings or other
precautionary measures relating to hazards to Person and property associated
with the NGLs sold hereunder and, furthermore, Dynegy shall defend at its own
expense, indemnify fully and hold harmless Texaco and its parents,
subsidiaries and Affiliates and its and their agents, officers, directors,
employees, representatives, successors and assigns from and against any and
all liabilities; losses; damages; demands; claims; penalties; fines; actions;
suits; legal, administrative or arbitration or alternative dispute resolution
proceedings; judgments, orders, directives, injunctions, decrees or awards of
any jurisdiction; costs and expenses (including, but not limited to,
reasonable attorneys' fees and related costs) arising out of or in any manner
related to Dynegy's failure to provide necessary warnings or other
precautionary measures in connection with the NGLs sold hereunder.

                                       24
<Page>

     15.6 Except as otherwise provided herein, each Party reserves to itself
all rights, set-offs, counterclaims, and other remedies and/or defenses which
such Party is or may be entitled to arising from or out of this Agreement or
as otherwise provided by law.

     15.7 Confidentiality Provisions.

         (a)      Each Party agrees that it will maintain this Agreement, all
                  terms and conditions of this Agreement, and all other
                  Confidential Information (as hereinafter defined) in strictest
                  confidence, and that it will not cause or permit disclosure of
                  Confidential Information to any third Person without the
                  express written consent of the other Party hereto. Disclosures
                  of Confidential Information otherwise prohibited by this
                  Section 15.7 may be made by either Party: (i) to the extent
                  necessary for such Party to enforce its rights hereunder
                  against the other Party; (ii) to the extent a Party is
                  contractually or legally bound to disclose information to a
                  third Person (such as a shareholder or commercial lender);
                  (iii) only to the extent to which a Party hereto is required
                  to disclose all or part of this Agreement by a statute or by
                  the order of a court, agency, or other governmental body
                  exercising jurisdiction over the subject matter hereof, by
                  order, by regulations, or by other compulsory process
                  (including, but not limited to, deposition, subpoena,
                  interrogatory, or request for production of documents); (iv)
                  to the extent required by the applicable regulations of a
                  securities or commodities exchange; or (v) to an Affiliate
                  (but only if such Affiliate agrees to be bound by the
                  provisions of this Section). "Confidential Information" shall
                  mean any information, proprietary to either Party and
                  maintained by it in confidence or as a trade secret,
                  including, without limitation, business plans and strategies,
                  proprietary software, financial statements, customer or client
                  lists, personnel records, analysis of general energy market
                  conditions, sales, transportation, and service contracts and
                  the commercial terms thereof, relationships with current and
                  potential business partners, supplies customers, service
                  providers and financial sources, data base contents and
                  valuable information of a like nature relating to the business
                  of such Party. It is understood and agreed that Confidential
                  Information shall not include information of a Party that (w)
                  becomes generally available to the public at the time of
                  disclosure to the other Party, or (x) after the time of
                  disclosure to the other Party, was generally made available to
                  the public without breach of this Agreement, or (y) the Person
                  receiving the information can show was rightfully in its
                  possession at the time of disclosure, or (z) was rightfully
                  acquired by the recipient from third Persons who did not
                  themselves obtain such information under a confidentiality or
                  other similar agreement with the Party whose information was
                  disclosed.

         (b)      If either Party is or becomes aware of a fact, obligation, or
                  circumstance that has resulted or may result in a disclosure
                  of Confidential Information authorized by this Section 15.7,
                  it shall so notify the other Party promptly and shall provide
                  documentation or an explanation of such disclosure as soon as
                  it is available. Each Party further agrees to cooperate to the
                  fullest extent in seeking confidential status to protect any
                  Confidential Information so disclosed.

                                       25
<Page>

         (c)      The Parties hereto acknowledge that independent legal counsel,
                  certified public accountants, or other consultants or
                  independent contractors of a Party (collectively, "Outside
                  Consultants") may, from time to time, be provided with a copy
                  of this Agreement if, in the judgment of the disclosing Party,
                  the information contained in this Agreement is necessary to
                  the performance of such Outside Consultants' duties.
                  Accordingly, the Parties agree that such disclosure does not
                  require consent by the other Party, provided that any such
                  Outside Consultants agree to be bound by the provisions of
                  this Section 15.7.

         (d)      Each Party will be deemed solely responsible and liable for
                  the actions of its employees, Outside Consultants, officers,
                  and agents for maintaining the confidentiality commitments of
                  this Section 15.7, but will be required in that regard only to
                  exercise such care in maintaining the confidentiality of the
                  Confidential Information as such Party normally exercises in
                  preserving the confidentiality of its other commercially
                  sensitive information.

     15.8 Nothing contained in this Agreement shall be construed to create an
association, trust, partnership, or joint venture or impose a trust or
partnership duty, obligation, or liability on or with regard to either Party.

     15.9 In construing this Agreement, the following principles shall be
followed:

         (a)      no consideration shall be given to the fact or presumption
                  that one Party had a greater or lesser hand in drafting this
                  Agreement;

         (b)      examples shall not be construed to limit, expressly or by
                  implication, the matter they illustrate;

         (c)      the word "includes" and its syntactical variants mean
                  "includes, but is not limited to" and corresponding
                  syntactical variant expressions; and

         (d)      the plural shall be deemed to include the singular and vice
                  versa, as applicable.

     15.10 EACH PARTY EXECUTING THIS AGREEMENT HEREBY WAIVES ITS RESPECTIVE
RIGHTS, IF ANY, UNDER THE DECEPTIVE TRADE PRACTICES--CONSUMER PROTECTION ACT,
SECTION 17.41 ET SEQ., TEXAS BUSINESS & COMMERCE CODE, A LAW THAT GIVES
CONSUMERS SPECIAL RIGHTS AND PROTECTIONS. AFTER CONSULTATION WITH AN ATTORNEY
OF ITS OWN SELECTION, EACH PARTY EXECUTING THIS AGREEMENT VOLUNTARILY
CONSENTS TO THIS WAIVER. IN ADDITION, EACH PARTY EXECUTING THIS AGREEMENT
HEREBY REPRESENTS AND WARRANTS TO THE OTHER PARTY THAT (i) SUCH PARTY'S LEGAL
COUNSEL WAS NOT DIRECTLY OR INDIRECTLY IDENTIFIED, SUGGESTED, OR SELECTED BY
THE OTHER PARTY OR BY AN AGENT OF SUCH OTHER PARTY, AND (ii) NEITHER PARTY
EXECUTING THIS AGREEMENT IS IN A SIGNIFICANTLY DISPARATE BARGAINING POSITION.

                                    26
<Page>

     15.11 Any notice or other communication provided for in this Agreement
or any notice which either Party may desire to give to the other shall be in
writing and shall be deemed to have been properly given if and when sent by
facsimile transmission, delivered by hand; or, if sent by mail, upon deposit
in the United States mail, either U.S. Express Mail, registered mail, or
certified mail, with all postage fully prepaid; or, if sent by courier, by
delivery to a bonded courier with charges paid in accordance with the
customary arrangements established by such courier, in each case addressed to
the Parties at the following addresses:

     If to Dynegy:    DYNEGY LIQUIDS MARKETING AND TRADE
                      1000 Louisiana, Suite 5800
                      Houston, Texas 77002
                      Attention: Senior Vice President--Marketing
                      Telephone: (713) 507-6801
                      Telecopy: (713) 507-6588

              with a copy to:

                      Senior Vice President & General Counsel
                      DYNEGY LIQUIDS MARKETING AND TRADE
                      1000 Louisiana, Suite 5800
                      Houston, Texas 77002
                      Attention: President
                      Telephone: (713) 507-3725
                      Telecopy: (713) 507-6987

       If to Texaco:  NOTICES AND CORRESPONDENCE
                      Texaco Exploration and Production, Inc.
                      P.O. Box 2100
                      Houston, TX 77252-2100
                      Attention: Jay Ellzey
                      Telephone: 713-754-3170
                      Telecopy: 713-754-2536

                      STATEMENTS
                      Chevron U.S.A. Inc.
                      P.0. Box J
                      Concord CA. 94524
                      Attention: Section 980
                      Telephone: (510) 827-7382
                      Telecopy: (510) 680-4372

                                       27
<Page>

                      PAYMENTS SHALL BE MADE BY WIRE TRANSFER TO:
                      Chevron U.S.A. Production Company
                      Account No. 5951704
                      First National Bank of Chicago--Chicago, IL
                      ABA Ref. No. 071 000 013

              Notices, Correspondence and Payments shall be directed to TNGI
              for itself and as representative for TEPI.

or at such other address as either Party shall designate by written notice to
the other. A notice sent by facsimile shall be deemed to have been received
by the close of the Business Day following the day on which it was
transmitted and confirmed by transmission report or such earlier time as
confirmed orally or in writing by the receiving Party. Notice by U.S. Mail,
whether by U.S. Express Mail, registered mail or certified mail, or by
overnight courier shall be deemed to have been received by the close of the
second Business Day after the day upon which it was sent, or such earlier
time as is confirmed orally or in writing by the receiving Party. Routine
operating notices may be transmitted by electronic mail, as may other
communications where electronic mail is specifically authorized by other
provisions of this Agreement. Any Party may change its address or facsimile
number by giving notice of such change in accordance with herewith.

     15.12 No director, employee, or agent of either Party shall give or
receive any commission, fee, rebate, gift, or entertainment of significant
cost or value in connection with this Agreement. Any mutually agreeable
representative(s) authorized by either Party may audit the applicable records
of the other Party solely for the purpose of determining whether there has
been compliance with this section, but no more often than once during each
year during the term hereof.

     15.13 Each Party shall provide the other Party such reports as may be
mutually agreeable to both Parties. Each Party shall maintain such records
and accounts as may be necessary to the performance of its respective duties
and obligations hereunder, in accordance with good business practices.

     15.14 This Agreement is for the sole benefit of the Parties and their
respective successors and permitted assigns, and shall not inure to the
benefit of any other Person whomsoever, it being the intention of the Parties
that no third Person shall be deemed a third Party beneficiary of this
Agreement.

     15.15 Each Party shall take such acts and execute and deliver such
documents in form and substance reasonably satisfactory to each of them, in
order to effectuate the purposes of this Agreement.

                   [End of document--signatures on next page]

                                       28

<Page>

         IN WITNESS WHEREOF, the Parties hereto have executed this Agreement the
day and year first above written.

                                      DYNEGY LIQUIDS MARKETING
                                          AND TRADE

                                      BY:  DYNEGY MIDSTREAM SERVICES,
                                           LIMITED PARTNERSHIP, General
                                           Partner of Dynegy Liquids Marketing
                                           and Trade

                                      BY:  DYNEGY MIDSTREAM G.P., INC.,
                                           General Partner of Dynegy Midstream
                                           Services, Limited Partnership

                                      By: /s/ Vincent T. McConnell
                                         ------------------------------------
                                      Name:   Vincent T. McConnell
                                           ----------------------------------
                                      Title: Sr. Vice President Liquids Trading
                                           ----------------------------------

                                      TEXACO EXPLORATION AND
                                      PRODUCTION INC.

                                      By: /s/ [ILLEGIBLE]
                                         ------------------------------------
                                      Name:   [ILLEGIBLE]
                                           ----------------------------------
                                      Title:  Vice President
                                            ---------------------------------

                                      TEXACO NATURAL GAS INC.

                                      By: /s/ R.C. Neff
                                         ------------------------------------
                                      Name:   R.C. Neff
                                           ----------------------------------
                                      Title:  Manager Midstream
                                              Executive Vice President
                                            ---------------------------------

          SIGNATURE PAGE TO NATURAL GAS LIQUIDS PURCHASE AGREEMENT
          BETWEEN TEXACO EXPLORATION AND PRODUCTION, INC., TEXACO
          NATURAL GAS INC., AND DYNEGY LIQUIDS MARKETING AND TRADE

                                      29

<Page>

                                   EXHIBIT "A"

         ATTACHED TO AND MADE A PART OF THAT CERTAIN NATURAL GAS
         LIQUIDS PURCHASE AGREEMENT BETWEEN TEXACO EXPLORATION AND
         PRODUCTION, INC., TEXACO NATURAL GAS INC., AND DYNEGY LIQUIDS
         MARKETING AND TRADE

                           INDEX OF THE SPECIFICATIONS
                           ---------------------------
                          FOR NGLS PURCHASED BY DYNEGY
                          ----------------------------

<Table>
<Caption>

         Number                            Name
         ------                            ----
         <S>                     <C>
         S-101                   Demethanized Raw Product--Trucked
         S-104                   Propane-Butane Mix
         S-105                   Butane-Natural Gasoline
         S-200                   80-20 Ethane-Propane Mix
         S-202                   Purity Ethane
         S-300                   Propane
         S-400                   Normal Butane
         S-401                   Isobutane
         S-402                   Mixed Butanes
         S-500                   Normal Pentane
         S-501                   Isopentane
         S-600                   Natural Gasoline
         S-601                   Hexanes Plus

</Table>
<Page>

                                   EXHIBIT "B"

ATTACHED TO AND MADE A PART OF THAT CERTAIN NATURAL GAS LIQUIDS PURCHASE
AGREEMENT BETWEEN TEXACO EXPLORATION AND PRODUCTION, INC., TEXACO NATURAL GAS
INC., AND DYNEGY LIQUIDS MARKETING AND TRADE

                            TEPI NGL SALES TO DYNEGY
                              (Mont Belvieu Option)
<Table>
<Caption>
--------------------------------------------------------
PLANT/SOURCE      STATE    PRICING LOCATION *1
--------------------------------------------------------
<S>               <C>      <C>
Rangely Weber     CO       Mont Belvieu
--------------------------------------------------------
Buckeye C(2)      NM       Mont Belvieu
--------------------------------------------------------
Eunice            NM       Mont Belvieu
--------------------------------------------------------
Eunice-Monument   NM       Mont Belvieu
--------------------------------------------------------
Baker *2          OK       Mont Belvieu
--------------------------------------------------------
Maysville *2, *3  OK       Mont Belvieu or local sales
--------------------------------------------------------
Bradford Ranch    TX       Mont Belvieu
--------------------------------------------------------
Garden City       TX       Mont Belvieu
--------------------------------------------------------
Goldsmith         TX       Mont Belvieu
--------------------------------------------------------
Headlee           TX       Mont Belvieu
--------------------------------------------------------
Ozona             TX       Mont Belvieu
--------------------------------------------------------
Seminole Hess     TX       Mont Belvieu
--------------------------------------------------------
Wasson - Denver   TX       Mont Belvieu
--------------------------------------------------------
Wasson - ODC      TX       Mont Belvieu
--------------------------------------------------------
OPAL              WY       Mont Belvieu
--------------------------------------------------------
Patrick Draw *3   WY       Mont Belvieu or local sales
--------------------------------------------------------
</Table>

*1 If for any reason outside of Dynegy's control, Raw NGL Mix is not capable of
   being fractionated at Mont Belvieu, the price for such Raw NGL Mix as set
   forth in this agreement shall not apply. In such event, the appropriate
   index and/or basis differential for such Raw NGL Mix will be mutually agreed
   to by the parties.

*2 As to these facilities, Dynegy shall have the right to cause the Raw NGL Mix
   to fractionated either at Conway or at Mont Belvieu. The price for the Raw
   NGL Mix produced at these facilities shall be the Mont Belvieu based price
   irrespective of whether the Raw NGL Mix is actually fractionated at Mont
   Belvieu or Conway.

*3 Dynegy may make local sales of NGLs from these facilities as provided for in
   Section 5.1(b) of the Natural Gas Liquids Purchase Agreement.

4  With the exception of the Plants addressed in Notes 2 and 3 above, Dynegy
   shall not cause Raw NGL Mix produced from the Plants listed on this Exhibit
   and purchased by Dynegy hereunder to be fractionated at any location other
   than the EPO Fractionator without first obtaining Texaco's prior written
   consent.

<Page>

                                   EXHIBIT "C"

ATTACHED TO AND MADE A PART OF THAT CERTAIN NATURAL GAS LIQUIDS PURCHASE
AGREEMENT BETWEEN TEXACO EXPLORATION AND PRODUCTION, INC., TEXACO NATURAL GAS
INC., AND DYNEGY LIQUIDS MARKETING AND TRADE

                            TEPI NGL SALES TO DYNEGY
                               (Local Sales Only)
<Table>
<Caption>
----------------------------------------------------------
PLANT / SOURCE    STATE    MARKET              PRODUCTS
----------------------------------------------------------
<S>               <C>      <C>                 <C>
ANETH*            UT       Sale at Tailgate    Y-grade
----------------------------------------------------------
OLD OCEAN         TX       Sale at Tailgate    Purity
----------------------------------------------------------
PEGASUS           TX       Sale at Tailgate    Y-grade
----------------------------------------------------------
PEGASUS           TX       Sale at Tailgate    Ethane
----------------------------------------------------------
PEGASUS           TX       Sale at Tailgate    Propane
----------------------------------------------------------
WILSON CREEK      CO       Sale at Tailgate    Y-grade
----------------------------------------------------------
</Table>

*Production from Aneth Plant is to be sold under this Agreement only until
alternate arrangements are made by TEPI (expected to occur approximately June
1, 2002).

<Page>

                            DEMETHANIZED RAW PRODUCT
                          TRUCK TRANSPORT SPECIFICATION

                                                                           S-101
                                                          Effective Date: 3/1/96

Product characteristics with test methods are herein specified for any
demethanized raw material of natural gas liquids transported by insulated
tank trucks for receipt by Dynegy.

<Table>
<Caption>
                                                                                                  TEST METHODS
PRODUCT CHARACTERISTICS                                    MINIMUM         MAXIMUM              LATEST REVISION
-----------------------                                  -----------    --------------          ---------------
<S>       <C>                                            <C>            <C>                     <C>
1.        COMPOSITION                                                                              ASTM E-260
          Percent by Liquid Volume                       Predominantly Ethane, Propane
                                                         Butanes & Natural Gasoline
                                                         (Pentanes & Heavier)                      GPA 2177
          Methane & Ethylene                                            2.0 of Ethane
          Ethylene                                                      1.0 of Ethane
          Propylene                                                     5.0 of Propane             ASTM D-2163
          Butylene                                                      1.0 of Butanes

2.     PRODUCT VAPOR PRESSURE                                           275 psig                   ASTM D-1267

3.     LOADING TEMPERATURE
        Minimum Product Loading
        Temperature, DEG. F                              0

4.     CORROSION
        Copper Strip@ 100 DEG. F                                        1-b                        ASTM D-1838
        (Invalid if additive or
        inhibitor is used.)
        Corrosion Additive or
        Inhibitor, PPM by Weight                                        1                          Applicable Industry
                                                                                                   Practices
5.     TOTAL SULFUR
        PPM by Weight in Liquid                                         150                        ASTM D-3246

6.     CARBON DIOXIDE
        PPM by Weight in Liquid                                         1000                       GPA 2177

7.     DRYNESS                                                          No Free Water              Visual

8.     PENTANES & HEAVIER                                               No Color                   Visual using white
                                                                        cup method
       Perform the Saybolt color test after
       weathering sample to 70 DEG. F if white
       cup indicates possible color.
       COLOR
       Saybolt No.                                       Plus 25                                   ASTM D-156
       DISTILLATION
       End Point DEG. F                                                 375                        ASTM D-216

9.     ODORIZATION
       This product shall not be odorized.

10.    DELETERIOUS SUBSTANCES (PPM BY WEIGHT IN LIQUID)
        COS                                                             1
        Ammonia                                                         1
        Fluorides                                                       1
</Table>

PRODUCT ACCOUNTING
For accounting purposes, methane and ethylene shall be considered ethane,
propylene shall be considered propane, and butylenes shall be considered
normal butane within the above listed specification limits.

<Page>

Any excess of these hydrocarbon components above the specification limits
shall not be accounted for.

METHANOL
Shippers should reduce methanol levels to the lowest practical level.
Injection rates above the minimum are expensive and wasteful and methanol can
destroy catalyst beds in downstream operations.

<Page>

                             PROPANE-BUTANE MIXTURE
                                 SPECIFICATION

                                                                          S-104
                                                         Effective Date: 3/1/96

Product characteristics with test methods are herein specified for
propane-butane mixtures received by Dynegy.

<Table>
<Caption>

                                                                                                  TEST METHODS
PRODUCT CHARACTERISTICS                                   MINIMUM         MAXIMUM                LATEST REVISION
-----------------------                                  ---------       ---------              -----------------
<S>                                                    <C>               <C>                    <C>
1.     COMPOSITION                                                                                ASTM E-260
       Percent by Liquid Volume                        Predominantly     Propane, Isobutane &
                                                       Normal Butane
       Ethane                                                            2.0 of Propane           ASTM D-2597
       Propylene                                                         1.0 of Propane           ASTM D-2163
       Butylene                                                          1.0 of Isobutane
       Pentanes & Heavier                                                2.0 of Butanes

2.     CORROSION
       Copper Strip @ 100 DEG. F                                         1-b                      ASTM D-1838
       (Invalid if additive or
       inhibitor is used.)
       Corrosion Additive or
       Inhibitor, PPM by Weight                                          1                        Applicable Industry Practices

3.     TOTAL SULFUR
        PPM by Weight in Liquid                                          150                      ASTM D-3246

4.     VOLATILE RESIDUE
        95% Evaporated, Temperature, DEG.F                               +36                      ASTM D-1837

5.     DRYNESS                                                           No Free Water            Visual

6.     CARBONYL SULFIDE
       PPM by Weight in Liquid                                           2                        Field - Length of
       (Field test invalid if                                                                     Stain Tube
       C4+ exceeds 1.0 LV%)                                                                       Lab - UOP 212 or UOP 791
                                                                                                  Lab-Gas Chromatography with
                                                                                                  Flame Photometric Detector
7.     HYDROGEN SULFIDE
       PPM by Weight in Liquid                                           1                        Field - Length of Stain Tube.
       (Lab test required if field                                                                Lab - Gas Chromatography
       test is positive.)                                                                         with Flame Photometric Detector

THE FOLLOWING TESTS ARE OPTIONAL, DEPENDING
UPON PRODUCT SOURCE:
--------------------------------------------

8.     AMMONIA (PPM BY WEIGHT IN LIQUID)
       PPM by Weight in Liquid                                           1                        Field - Length of Stain Tube
                                                                                                  Lab - UOP 430
9.     FLUORIDES (PPM BY WEIGHT IN LIQUID)
        PPM by Weight in Liquid as                                       1                        Field - Length of
        Monatomic Fluorine                                                                        Stain Tube
                                                                                                  Lab-UOP 619-83

10.    PENTANES & HEAVIER                                                No Color                 Visual using white cup
       (For C5+ > 2% LV)                                                                          method
       Perform the following Saybolt color test
       after weathering sample to 70 DEG. F if
       white cup indicates possible color.
              COLOR
             Saybolt No.                                   Plus 25                                ASTM D-156

             DISTILLATION
             End Point, DEG. F                                           375                      ASTM D-216
</Table>

PRODUCT ACCOUNTING
For accounting purposes, ethane and propylene shall be considered propane,
butylenes shall be considered normal butane, and pentanes and heavier shall be
considered normal butane within the above listed specification limits. Any
excess of these hydrocarbon components above the specification limits shall not
be accounted for.

NOTE: The test method for Item 4 is not necessary if an adequate
compositional analysis is available which indicates compliance with this
requirement.

<Page>

                         BUTANE-NATURAL GASOLINE MIXTURE
                                  SPECIFICATION

                                                                          S-105
                                                         Effective Date: 3/1/96

Product characteristics with test methods are herein specified for
butane-natural gasoline mixtures received by Dynegy.

<Table>
<Caption>

                                                                                                      TEST METHODS
PRODUCT CHARACTERISTICS                                    MINIMUM         MAXIMUM                   LATEST REVISION
-----------------------                                   ---------       ---------                 -----------------
<S>                                                       <C>            <C>                        <C>
1.   COMPOSITION                                                         Predominantly Isobutane,   ASTM E-260
         Percent by Liquid Volume                                        Normal Butane & Natural
                                                                         Gasoline (Pentanes &
                                                                         Heavier)                   GPA 2177
                                                                                                    ASTM D2597
         Propane                                                         3.0 of Isobutane
         Butylene                                                        1.0 of Isobutane

2.   CORROSION
        Copper Strip @ 100 DEG. F                                        1-b                        ASTM D-1838
        (Invalid if additive or
        inhibitor is used.)
        Corrosion Additive or                                                                       Applicable Industry
        Inhibitor, PPM by Weight                                         1                          Applicable Industry
                                                                                                    Practices
3.     TOTAL SULFUR
         PPM by Weight in Liquid                                         150                        ASTM D-3246
                                                                                                    or Gas Chromatography
                                                                                                    with Flame Photometric
                                                                                                    Detection

4.     DRYNESS                                                           No Free Water              Visual

5.     AMMONIA
         PPM by Weight in Liquid                                         1                          Field - Length of
                                                                                                    Stain Tube
                                                                                                    LaB - UOP 430
6.     HYDROGEN SULFIDE
        PPM by Weight in Liquid                                          1                          Field - Length of
        (Lab test required if field                                                                 Stain Tube
        test is positive)                                                                           Lab - Gas Chromatography
                                                                                                    with Flame Photometric
                                                                                                    Detection

7.     PENTANES & HEAVIER                                                No Color                   Visual using
       (Only if C5+ > 2 LV%)                                                                        White Cup Method
       Perform the Saybolt color test
       after weathering sample to 70 DEG. F
       if white cup test indicates possible
       color.
             COLOR
             Saybolt No.                                    Plus 25                                 ASTM D-156
             DISTILLATION
             End Point, DEG. F                                           375                        ASTM D-216

8.     FLUORIDES
         PPM by weight in liquid                                         1

</Table>

PRODUCT ACCOUNTING

For accounting purposes, propane shall be considered isobutane and butylenes
shall be considered normal butane within the above listed specification limits.

Any excess of these hydrocarbon components above the specification limits shall
not be accounted for.

<PAGE>

                                 ETHANE-PROPANE
                                  80-20 MIXTURE
                                  SPECIFICATION

                                                                          S-200
                                                         Effective Date: 3/1/96

Product characteristics with test methods are herein specified for
ethane-propane 80-20 mixtures received by Dynegy.

<Table>
<Caption>
                                                                                                TEST METHODS
PRODUCT CHARACTERISTICS                            MINIMUM          MAXIMUM                    LATEST REVISION
-----------------------                           ---------        ---------                  -----------------
<S>                                               <C>              <C>                        <C>
1.   COMPOSITION                                                                              ASTM E-260
         Percent by Liquid Volume
         Methane (Percent of Ethane)                                   2.0                    GPA 2177
         Ethylene (Percent of Ethane)                                  1.0
         Methane, Ethane & Ethylene                     78.0           82.0
         Propane, Propylene & Butanes                   18.0           22.0                   ASTM D-2163
         Propylene                                                     1.0
         Butanes                                                       0.8

2.   CORROSION
         Copper Strip @ 100 DEG. F                                     1-b                    ASTM D-1838
         (Invalid if additive or
         inhibitor is used.)
         Corrosion Additive or
         Inhibitor, PPM by Weight                                      1                      Applicable Industry
                                                                                              Practices
3.   TOTAL SULFUR
         PPM by Weight in Liquid                                       120                    ASTM D-3246

4.   DRYNESS                                                           No Free Water          Visual

5.   CARBON DIOXIDE
         PPM by Weight in Liquid                                       1,000                  GPA 2177
</Table>

PRODUCT ACCOUNTING

For accounting purposes, methane and ethylene shall be considered ethane,
propylene and butanes shall be considered propane within the above listed
specification limits.

Any excess of these hydrocarbon components above the specification limits shall
not be accounted for.

<PAGE>

                          PURITY ETHANE SPECIFICATION

                                                                          S-202
                                                         Effective Date: 3/1/96

Product characteristics with test methods are herein specified for purity ethane
received by Dynegy.

<Table>
<Caption>
                                                                                             TEST METHODS
PRODUCT CHARACTERISTICS                           MINIMUM         MAXIMUM                   LATEST REVISION
-----------------------                          ---------       ---------                 -----------------
<S>                                               <C>              <C>                     <C>

1.   COMPOSITION                                                                             ASTM E-260
          Percent by Liquid Volume
          Methane                                                      3.0                   GPA-2177
          Ethane                                        95.0           100.0
          Ethylene                                                     1.0
          Heavier than Ethane                                          3.5                   ASTM D-2163
          Propylene                                                    1.0

2.   CORROSION
          Copper Strip @ 100 DEG. F                                    1-b                   ASTM D-1838
          (Invalid if additive or
          inhibitor is used.)
          Corrosion Additive or
          Inhibitor, PPM by Weight                                     1                     Applicable Industry
                                                                                             Practices
3.   TOTAL SULFUR
          PPM by Weight in Liquid                                      30                    ASTM D-3246

4.   DRYNESS                                                           No Free Water         Visual

5.   CARBON DIOXIDE

          PPM by Weight in Liquid                                      1,000                 GPA 2177

</Table>

PRODUCT ACCOUNTING

For accounting purposes, methane and ethylene shall be considered ethane,
propylene and butanes shall be considered propane within the above listed
specification limits.

Any excess of these hydrocarbon components above the specification limits shall
not be accounted for.

<Page>

                                   PROPANE
                                SPECIFICATION

                                                                          S-300
                                                         Effective Date: 3/1/96

Product characteristics with test methods are herein specified for propane
received by Dynegy. This product meets the requirement of the GPA HD-5
propane specification.

<Table>
<Caption>
                                                                                                  TEST METHODS
 PRODUCT CHARACTERISTICS                                MINIMUM              MAXIMUM             LATEST REVISION
-------------------------                             -----------      -------------------       ---------------
<S>                                                   <C>              <C>                       <C>
1.     COMPOSITION                                                                                ASTM E-260
       Percent by Liquid Volume Ethane                                 As limited by other
                                                                       components & vapor
                                                                       pressure.
       Propane                                          90.0           100
       Propylene                                                       5.0                        ASTM D-2163
       Butanes & Heavier                                               2.5

2.     VAPOR PRESSURE
       Psig @ 100 DEG. F                                               208                        ASTM D-1267

3.     CORROSION
       Copper Strip @ 100 DEG. F                                       1-b                        ASTM D-1838
       (Invalid if additive or
       inhibitor is used.) Corrosion
       Additive or Inhibitor, PPM by Weight                            1                          Applicable Industry Practices

4.     TOTAL SULFUR
       PPM by Weight in Liquid                                         120                        ASTM D-3246

5.     HYDROGEN SULFIDE
       PPM by Weight in Liquid                                         1                          Field-Length of Stain Tube
       (Lab test required if field test is positive.)                                             Lab Chromatography with
                                                                                                  Flame Photometric Detector
6.     CARBONYL SULFIDE
       PPM by Weight in Liquid                                         2                          Field-Length of
       (Field test invalid if C(4)+ exceeds                                                       Stain Tube
       1.0 LV%) (Lab test required if                                                             Lab-UOP 212 or UOP 791
       field test is positive.)                                                                   Lab-Gas Chromatography with
                                                                                                  Flame Photometric Detector
7.     NON-VOLATILE RESIDUE
        a) Milliliters @ 100 DEG. F                                    0.05                       ASTM D-2158
        b) Oil Stain                                                   Pass

THE FOLLOWING TESTS ARE OPTIONAL, DEPENDING UPON THE PRODUCT SOURCE:

8.     DRYNESS
         Freeze Valve, Seconds                                         60 (Note 2)                ASTM D-2713

9.     VOLATILE RESIDUE
         95% Evaporated-Temperature, DEG. F                            -37                        ASTM D-1837

10.    AMMONIA
        PPM by Weight in Liquid                                        1                          Field-Length of
                                                                                                  Stain Tube
                                                                                                  Lab - UOP 430
11.    FLUORIDES
       PPM by Weight in Liquid as                                      5                          Field-Length of Stain Tube
       Monatomic Fluorine                                                                         Lab-UOP-619-83

<Page>

12.    OTHER DELETERIOUS SUBSTANCES (PPM BY WEIGHT IN LIQUID)
         Includes but not limited to                                   1                          Gas chromatography with flame
         (Isoprene, Butadiene, Vinyl                                                              ionization or electron
         Chloride, glycol, amine, caustic)                                                        capture detection or other
                                                                                                  industry accepted methods
</Table>

NOTES: (1) The test methods for items 2 and 7 are not necessary if a
           compositional analysis is available which indicates compliance with
           these requirements.

       (2) The addition of methanol in the distribution system should be on a
           spot basis and must not exceed a rate of 5 gallons per 10,000
           gallons of product.

<Page>

                                  NORMAL BUTANE
                                  SPECIFICATION

                                                                          S-400
                                                         Effective Date: 3/1/96

Product characteristics with test methods are herein specified for normal
butane received by Dynegy.

<Table>
<Caption>
                                                                                                  TEST METHODS
 PRODUCT CHARACTERISTICS                                MINIMUM              MAXIMUM             LATEST REVISION
-------------------------                             -----------      -------------------       ---------------
<S>                                                   <C>              <C>                       <C>
1.       COMPOSITION                                                                              ASTM E-260
           Percent by Liquid Volume

           Isobutane and Lighter                                       5.0                        ASTM D-2163
           Butylene (Percent of N.Butane)                              1.0
           N. Butane & Butylene                         95.0           100                        GPA 2165
           Pentanes & Heavier                                          2.0

2.       VAPOR PRESSURE
           Psig @ 100 DEG. F                                           50                         ASTM D-1267

3.       CORROSION
           Copper Strip @100 DEG. F                                    1-b                        ASTM D-1838
           (Invalid if additive
           or inhibitor is used.)
           Corrosion Additive or
           Inhibitor, PPM by Weight                                    1                          Applicable Industry
                                                                                                  Practices
4.       TOTAL SULFUR
           PPM by Weight in Liquid                                     140                        ASTM D-3246

5.       VOLATILE RESIDUE
           95% Evaporated-Temperature, DEG. F                          +36                        ASTM D-1837

6.       DRYNESS                                                       No Free Water              Visual
</Table>

NOTE: The test methods for Items 2 and 5 are not necessary if a compositional
analysis indicates compliance with these requirements.

<Page>

                                    ISOBUTANE
                                  SPECIFICATION

                                                                          S-401
                                                         Effective Date: 3/1/96

Product characteristics with test methods are herein specified for isobutane
received by Dynegy.

<Table>
<Caption>
                                                                                                  TEST METHODS
 PRODUCT CHARACTERISTICS                                MINIMUM              MAXIMUM             LATEST REVISION
-------------------------                             -----------      -------------------       ---------------
<S>                                                   <C>              <C>                       <C>
1.       COMPOSITION                                                                              ASTM E-260
           Percent by Liquid Volume
           Propane, Propylene and Lighter                              3.0                        ASTM D-2163
           Isobutane                                    96.0           100
           Butylene, Normal Butane
            & Heavier                                                  4.0

2.       VAPOR PRESSURE
           Psig @ 100 DEG. F                                           62                         ASTM D-1267

3.       CORROSION
           Copper Strip @ 100 DEG. F                                   1-b                        ASTM D-1838
           (Invalid if additive or
           inhibitor is used.)
           Corrosion Additive or
           Inhibitor, PPM by Weight                                    1                          Applicable Industry
                                                                                                  Practices
4.       TOTAL SULFUR
           PPM by Weight in Liquid                                     140                        ASTM D-3246

5.       VOLATILE RESIDUE
           95% Evaporated-Temperature DEG. F                           +16                        ASTM D-1837

6.       DRYNESS                                                        No Free Water              Visual
</Table>

NOTE: The test methods for Items 2 and 5 are not necessary if an adequate
compositional analysis is available which indicates compliance with these
requirements.

<Page>

                                MIXED BUTANES
                                SPECIFICATION

                                                                          S-402
                                                         Effective Date: 3/1/96

Product characteristics with test methods are herein specified for commercial
butane received by Dynegy.

<Table>
<Caption>
                                                                                                  TEST METHODS
 PRODUCT CHARACTERISTICS                                MINIMUM              MAXIMUM             LATEST REVISION
-------------------------                             -----------      -------------------       ---------------
<S>                                                   <C>              <C>                       <C>
1.      COMPOSITION                                                    Predominately Isobutane    ASTM E-260
          Percent by Liquid Volume                                     & Normal Butane

          Propane                                                      3.0 of Isobutane           ASTM D-2163
          Butylene                                                     1.0 of Isobutane
          Pentanes & Heavier                                           2.0 of Butanes

2.      VAPOR PRESSURE
          Psig @ 100 DEG. F                                            70                         ASTM D-1267

3.      CORROSION
          Copper Strip @ 100 DEG. F                                    1-b                        ASTM D-1838
          (Invalid if additive or
          inhibitor is used.)
          Corrosion Additive or
          Inhibitor, PPM                                               1                          Applicable Industry
                                                                                                  Practices
4.      TOTAL SULFUR
          PPM by Weight in Liquid                                      140                        ASTM D-3246

3.      VOLATILE RESIDUE
          95% Evaporated, Temperature, DEG. F                          +36                        ASTM D-1837

6.      DRYNESS                                                        No Free Water              Visual

7.      BUTADIENE
          Percent by Liquid Volume                                     0.5                        Gas Chromatography
</Table>

PRODUCT ACCOUNTING

For Accounting purposes, propane shall be considered isobutane, butylenes
shall be considered normal butane, and pentanes and heavier shall be
considered normal butane within the above listed specification limits.

Any excess of these hydrocarbon components above the specification limits
shall not be accounted for.

NOTE: The test methods for Items 2 and 5 are not necessary if an adequate
compositional analysis is available which indicates compliance with these
requirements.

<Page>

                                 NORMAL PENTANE
                                 SPECIFICATION

                                                                          S-500
                                                         Effective Date: 3/1/96

Product characteristics with test methods are herein specified for normal
pentane received by Dynegy.

<Table>
<Caption>
                                                                                                  TEST METHODS
 PRODUCT CHARACTERISTICS                                MINIMUM              MAXIMUM             LATEST REVISION
-------------------------                             -----------      -------------------       ---------------
<S>                                                   <C>              <C>                       <C>
1.      COMPOSITION                                                                               ASTM E-260
          Percent by Liquid Volume
          Isopentane & Lighter                                         5.0                        GPA 2165
          Normal Pentane                                90             100                        ASTM D-2597
          Heavier than Normal Pentane                                  7.0

2.      VAPOR PRESSURE
          Psi @ 100 DEG. F, Reid                                       17                         ASTM D-323

3.      CORROSION
          Copper Strip @ 100 DEG. F                                    1-b                        ASTM D-1838
          (Invalid if additive or
          inhibitor is used.)
          Corrosion Additive or
          Inhibitor, PPM by Weight                                     1                          Applicable Industry
                                                                                                  Practices

4.      DRYNESS                                                        No Free Water              Visual

5.      TOTAL SULFUR
          PPM by Weight in Liquid                                      150                        ASTM D-3246
                                                                                                  or Gas Chromatography
                                                                                                  with Flame Photometric
                                                                                                  Detection
</Table>

<Page>

                                   ISOPENTANE
                                  SPECIFICATION

                                                                          S-501
                                                         Effective Date: 3/1/96

Product characteristics with test methods are herein specified for isopentane
received by Dynegy.

<Table>
<Caption>
                                                                                                   TEST METHODS
   PRODUCT CHARACTERISTICS                             MINIMUM        MAXIMUM                     LATEST REVISION
-----------------------------                         ---------      ---------                    ---------------
<S>                                                    <C>            <C>                         <C>
1.    COMPOSITION
        Percent by Liquid Volume                                                                  ASTM E-260
        Normal Butane & Lighter                                        5.5                        ASTM D-2597
        Isopentane                                      94.0           100                        GPA 2165
        Neopentane                                                     2.0
        Normal Pentane & Heavier                                       4.0

2.    VAPOR PRESSURE
        Psi @ 100 DEG. F, Reid                                         22                         ASTM D-323

3.    CORROSION
        Copper Strip @ 100 DEG. F                                      1-b                        ASTM D-1838
        (Invalid if additive or
        inhibitor is used.)
        Corrosion Additive or
        Inhibitor, PPM by Weight                                       1                          Applicable Industry
                                                                                                  Practices

4.    DRYNESS                                                          No Free Water              VISUAL

5.    TOTAL SULFUR
        PPM by Weight in Liquid                                        150                        ASTM D-3246
                                                                                                  or Gas Chromatography
                                                                                                  with Flame Photometric
                                                                                                  Detection
</Table>

<Page>

                                NATURAL GASOLINE
                                  SPECIFICATION

                                                                          S-600
                                                         Effective Date: 3/1/96

Product characteristics with test methods are herein specified for natural
gasoline received by Dynegy.

<Table>
<Caption>
                                                                                                  TEST METHODS
     PRODUCT CHARACTERISTICS                         MINIMUM           MAXIMUM                   LATEST REVISION
----------------------------------                  ---------         ---------                  ---------------
<S>                                                  <C>               <C>                       <C>
1.    COMPOSITION                                                                                  ASTM E-260
        Percent by Liquid Volume
        Butanes & Lighter                                               3.0                        GPA 2165
        Pentanes & Heavier                              97              100

2.    VAPOR PRESSURE
        Psi @ 100 DEG. F, Reid                                          16                         ASTM D-323

3.    CORROSION
        Copper Strip @ 104 DEG. F                                       1-b                        ASTM D-130
        (Invalid if additive or
        inhibitor is used.)
        Corrosion Additive or
        Inhibitor, PPM by Weight                                        1                          Applicable Industry
                                                                                                   Practices

4.    DOCTOR TEST                                                       Negative                   GPA 1138

5.    DRYNESS                                                           No Free Water              Visual

6.    COLOR                                             plus 25         No Color                   Field White Cup Method
                                                                                                   Lab-ASTM D-156

7.    DISTILLATION
        End Point, DEG. F                                               375                        ASTM D-216
</Table>

NOTE: The test methods for Items 2 and 7 are not necessary if an adequate
compositional analysis is available which indicates compliance with these
requirements.

     An RVP of 16 Psi as set forth in Item 2 will be acceptable as long as
the state and federal laws, rules and regulations allow for same. If the
allowed RVP changes, these specifications shall change accordingly.

<Page>

                                  HEXANES PLUS
                                 SPECIFICATION

                                                                          S-601
                                                         Effective Date: 3/1/96

Product characteristics with test methods are herein specified for hexanes plus
received by Dynegy.

<Table>
<Caption>
                                                                                                  TEST METHODS
     PRODUCT CHARACTERISTICS                          MINIMUM         MAXIMUM                    LATEST REVISION
----------------------------------                   ---------       ---------                   ---------------
<S>                                                   <C>             <C>                        <C>
1.    COMPOSITION                                                                                 ASTM E-260
        Percent by Liquid Volume
        Normal Pentane and Lighter                                     5.0
        Heavier than Normal Pentane                     95.0           100                        GPA 2165

2.    VAPOR PRESSURE
        Psi @ 100 DEG. F, Reid                                         8                          ASTM D-323

3.    CORROSION
        Copper Strip @ 100^ DEG. F                                     1-b                        ASTM D-130
        (Invalid if additive or
        inhibitor is used.)
        Corrosion Additive or
        Inhibitor, PPM by Weight                                       1                          Applicable Industry
                                                                                                  Practices

4.    DRYNESS                                                          No Free Water              VISUAL

5.    DISTILLATION ENDPOINT                                            375 DEG. F                 ASTM D-216
</Table>

<Page>

                                   EXHIBIT "B"

ATTACHED TO AND MADE A PART OF THAT CERTAIN NATURAL GAS LIQUIDS PURCHASE
AGREEMENT BETWEEN TEXACO EXPLORATION AND PRODUCTION, INC., TEXACO NATURAL GAS
INC., AND DYNEGY LIQUIDS MARKETING AND TRADE

           TEPI NGL SALES TO DYNEGY
             (Mont Belvieu Option)
<Table>
<Caption>
PLANT/SOURCE      STATE    PRICING LOCATION *1
----------------  ------   -------------------
<S>               <C>      <C>
Rangely Weber     CO       Mont Belvieu
Buckeye C0(2)     NM       Mont Belvieu
Eunice            NM       Mont Belvieu
Eunice-Monument   NM       Mont Belvieu
Baker *2          OK       Mont Belvieu
Maysville *2, *3  OK       Mont Belvieu or local sales
Bradford Ranch    TX       Mont Belvieu
Garden City       TX       Mont Belvieu
Goldsmith         TX       Mont Belvieu
Headlee           TX       Mont Belvieu
Ozona             TX       Mont Belvieu
Seminole Hess     TX       Mont Belvieu
Wasson - Denver   TX       Mont Belvieu
Wasson - ODC      TX       Mont Belvieu
OPAL              WY       Mont Belvieu
Patrick Draw *3   WY       Mont Belvieu or local sales
</Table>

*1  If for any reason outside of Dynegy's control, Raw NGL Mix is not capable of
    being fractionated at Mont Belvieu, the price for such Raw NGL Mix as set
    forth in this agreement shall not apply. In such event, the appropriate
    index and/or basis differential for such Raw NGL Mix will be mutually agreed
    to by the parties.

*2  As to these facilities, Dynegy shall have the right to cause the Raw NGL Mix
    to fractionated either at Conway or at Mont Belvieu. The price for the Raw
    NGL Mix produced at these facilities shall be the Mont Belvieu based price
    irrespective of whether the Raw NGL Mix is actually fractionated at Mont
    Belvieu or Conway.

*3  Dynegy may make local sales of NGLs from these facilities as provided for in
    Section 5.1(b) of the Natural Gas Liquids Purchase Agreement.

*4  With the exception of the Plants addressed in Notes 2 and 3 above, Dynegy
    shall not cause Raw NGL Mix produced from the Plants listed on this Exhibit
    and purchased by Dynegy hereunder to be fractionated at any location other
    than the EPO Fractionator without first obtaining Texaco's prior written
    consent.

<Page>

                                   EXHIBIT "C"

ATTACHED TO AND MADE A PART OF THAT CERTAIN NATURAL GAS LIQUIDS PURCHASE
AGREEMENT BETWEEN TEXACO EXPLORATION AND PRODUCTION, INC., TEXACO NATURAL GAS
INC., AND DYNEGY LIQUIDS MARKETING AND TRADE

<Table>
<Caption>
                            TEPI NGL SALES TO DYNEGY
                               (Local Sales Only)

 PLANT/SOURCE     STATE       MARKET         PRODUCTS
--------------    -----       ------         --------
<S>              <C>       <C>               <C>
ANETH*            UT       Sale at Tailgate  Y-grade
OLD OCEAN         TX       Sale at Tailgate  Purity
PEGASUS           TX       Sale at Tailgate  Y-grade
PEGASUS           TX       Sale at Tailgate  Ethane
PEGASUS           TX       Sale at Tailgate  Propane
WILSON CREEK      CO       Sale at Tailgate  Y-grade
</Table>

*Production from Aneth Plant is to be sold under this Agreement only until
alternate arrangements are made by TEPI (expected to occur approximately June 1,
2002).

<Page>

                       'Confidential Treatment Requested'

                                   EXHIBIT "D"

                   Attached to and made a part of that certain
                 Natural Gas Liquids Purchase Agreement between
        Texaco Exploration and Production, Inc., Texaco Natural Gas Inc.,
                     and Dynegy Liquids Marketing and Trade

                  TNGI NGL SALES TO DYNEGY (FOUR STAR VOLUMES)

For NGLs produced by Four Star and delivered by TNGI to Dynegy under this
Agreement, the pricing shall be as follows:

     (a) For the volumes of NGLs produced at the BAKER NORTH AND SAN JUAN
     PLANTS, and delivered to Dynegy at the applicable Delivery Point at (i) the
     tailgate of such Plants for subsequent transportation by pipeline or for
     exchange to Mont Belvieu, Texas, or (ii) at the EPO Delivery Points, a
*    price equal to [REDACTED] as quoted by the Oil Price Information Service
     ("OPIS") for Mont Belvieu, Texas (Non-TET) for the first Business Day of
     the month in which NGLs are delivered to Dynegy, less (1) applicable T&F
     Costs and distribution fees charged by the fractionator and/or storage
     operator ("Distribution Fees"), unless Fractionated NGLs are delivered to
     Dynegy at the EPO Delivery Points, in which case the T&F Costs and
     Distribution Fees will be paid directly by Texaco, and (2) an
*    administration fee of [REDACTED] per gallon. Notwithstanding the
*    foregoing, (y) Ethane shall be priced based on [REDACTED] as quoted by
     OPIS (Non-TET) at Mont Belvieu, Texas, for the first Business Day of the
     month in which Raw NGL Mix produced at the Plants is fractionated at the
     EPO Fractionator and such Ethane is delivered to Dynegy, but otherwise
*    shall be priced based on [REDACTED] as quoted by OPIS (Non-TET) at Mont
     Belvieu for the first Business Day of the month in which such Raw NGL Mix
     produced at the Plants is fractionated, if, for any reason, the Raw NGL
     Mix is fractionated at Cedar Bayou Fractionators in Mont Belvieu, Texas,
*    and (z) Propane shall be priced based on [REDACTED] as quoted by OPIS at
     Mont Belvieu (TET) for the first Business Day of the month in which such
     Propane is delivered to Dynegy, unless such Propane can not be delivered
     into TET for any reason outside of Dynegy's control, in which event, such
*    Propane shall be priced based on [REDACTED] as quoted by OPIS at Mont
     Belvieu, Texas (Non-TET) for the first Business Day of the month such
     Propane is delivered to Dynegy. Dynegy agrees to notify Texaco as soon as
     reasonably possible whenever Propane can not be delivered into TET for any
     reason outside of Dynegy's control.

     (b) For the volumes of NGLs produced at the Headlee Plant, and delivered to
     Dynegy at the applicable Delivery Point at (i) the tailgate of such Plant
     for subsequent transportation by pipeline or for exchange to Mont Belvieu,
*    Texas, or (ii) at the EPO Delivery Points, a price equal to [REDACTED] as
     quoted by the Oil Price Information Service ("OPIS") for Mont Belvieu,
     Texas (Non-TET) on the first Business Day of the month in which NGLs are
     delivered to Dynegy, less (1) applicable T&F Costs and distribution fees
     charged by the fractionator and/or

                                       1
<Page>

                      'Confidential Treatment Requested'

     storage operator ("Distribution Fees"), unless Fractionated NGLs are
     delivered to Dynegy at the EPO Delivery Points, in which case the T&F Costs
     and Distribution Fees will be paid directly by Texaco, and (2) an
*    administration fee of [REDACTED] per gallon. Notwithstanding the
*    foregoing, (y) Ethane shall be priced based on [REDACTED] as quoted by OPIS
     (Non-TET) at Mont Belvieu, Texas, for the first Business Day of the month
     in which Raw NGL Mix produced at the Plant is fractionated at the EPO
*    Fractionator, but otherwise shall be priced based on [REDACTED] as quoted
     by OPIS (Non-TET) at Mont Belvieu for the first Business Day of the month
     in which such Raw NGL Mix produced at the Plant if fractionated, if, for
     any reason, the Raw NGL Mix is fractionated at Cedar Bayou Fractionators in
*    Mont Belvieu, Texas, and (z) Propane shall be priced based on [REDACTED] as
     quoted by OPIS at Mont Belvieu (TET) for the first Business Day of the
     month such Propane is delivered to Dynegy, unless such Propane can not be
     delivered into TET for any reason outside of Dynegy's control, in which
*    event, such Propane shall be priced based on [REDACTED] as quoted by OPIS
     at Mont Belvieu, Texas (Non-TET) for the first Business Day of the month
     such Propane is delivered to Dynegy. Dynegy agrees to notify Texaco as
     soon as reasonably possible whenever Propane can not be delivered into
     TET for any reason outside of Dynegy's control.

     (c) For any volumes of NGLs delivered to Dynegy at the applicable Delivery
*    Point at the tailgate of the Hatters Pond Plant, [REDACTED] of the
*    Netback Price, less an administration fee of [REDACTED] per gallon. It is
     understood and agreed that TNGI shall not be obligated to sell Natural
     Gasoline to Dynegy and Dynegy shall not be obligated to purchase Natural
     Gasoline from TNGI for as long as such Natural Gasoline is sold by TNGI to
     either Equiva or any of TNGI's affiliates. Notwithstanding the foregoing,
     with respect to Propane, for as long as the Exchange Agreement between TNGI
     and Enterprise Products Operating Company (which will be assigned to
     Dynegy) remains in force and effect, the price payable by Dynegy to TNGI
*    shall be equal to [REDACTED] as quoted by the Oil Price Information
     Service ("OPIS") for Hattiesburg, Mississippi, for the first Business Day
     of the month in which Propane is delivered to Dynegy, less (1) the
*    exchange differential payable to Enterprise, (2) [REDACTED] per gallon
     for storage considerations and inconsistencies in product movements and
*    (3) an administration fee of [REDACTED] per gallon.

Note: It is understood and agreed that TNGI currently has the right to market
NGLs produced by Four Star Oil and Gas Company under a separate marketing
agreement between TNGI and Four Star. In the event that such agreement is
terminated prior to termination of this Agreement, TNGI shall have no further
obligations to deliver Four Star NGLs to Dynegy hereunder. TNGI shall notify
Dynegy as soon as possible of any such termination of its Four Star marketing
agreement.

                                       2

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