Document:

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                                                                   EXHIBIT 10.8

                            PIPELINE LEASE AGREEMENT

                                 by and between

                         MID-AMERICA PIPELINE COMPANY,

                                   as LESSOR,

                                      and

                            NAVAJO PIPELINE COMPANY,

                                   as LESSEE
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                            PIPELINE LEASE AGREEMENT

      THIS PIPELINE LEASE AGREEMENT (this "Lease" or this "Agreement") is
entered into by and between MID-AMERICA PIPELINE COMPANY, a Delaware corporation
("Lessor") and NAVAJO PIPELINE COMPANY, a Delaware corporation ("Lessee").

                                 R-E-C-I-T-A-L-S

      A.    Lessor is the owner of an 8" natural gas liquids pipeline currently
running from Lessor's Kutz Station in San Juan County, New Mexico to Lessor's
Hobbs Station in Gaines County, Texas. Lessor currently uses the 8" pipeline to
transport NGL south from its Kutz Station past White Lakes Station to its Hobbs
Station.

      B.    Lessee, and/or its affiliates, is engaged in the business of
refining crude oil into gasoline and other petroleum products and the
transportation and sale of such products. Lessor and Lessee desire to enter into
a transaction in which Lessee will lease the 8" pipeline from White Lakes
Station to Kutz Station running from Milepost 80.65 through Milepost 415.29, as
encompassed in the Alignment Sheets attached hereto as Exhibit A, together with
all attendant equipment and systems (hereinafter collectively referred to as the
"Pipeline System") and 100% of its capacity on an exclusive basis, subject to
common carrier requirements, for the purpose of transporting petroleum products
from White Lakes Station to Kutz Station. The origin of the Pipeline System will
be Lessor's White Lakes Station and the terminus will be at Lessor's Kutz
Station.

                               W-I-T-N-E-S-S-E-T-H

      NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which being hereby acknowledged, Lessor and Lessee agree as
follows:

      1.    DEMISE. Lessor, for and in consideration of the covenants and
agreements hereinafter set forth to be kept and performed by both parties, does
hereby demise and lease to Lessee for the Lease Term (hereinafter defined) the
Pipeline System and 100% of its capacity for transporting petroleum products
and/or crude oil from White Lakes Station to Kutz Station (provided; however, if
Lessee elects to transport crude oil: (1) it may do so only subject to any
Applicable Laws, which, at Lessee's expense, Lessor shall take reasonable steps
to address; and (2) if NGLs shipped on the Pipeline System by Lessor after
surrender of the Pipeline System by Lessee as referenced in Paragraph 18 are
crude-contaminated in excess of Lessor's specifications in an amount in excess
of 5,000 barrels, Lessor shall notify Lessee and Lessor and Lessee in
consultation and at Lessee's expense shall decontaminate all contaminated NGLs
and take such other steps as are reasonably necessary to resolve the
contamination.).

      2.    LESSOR'S WORK. Attached to this Lease as Exhibit "B" is a
description of

PIPELINE LEASE AGREEMENT--PAGE 1

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work to be performed by Lessor, at its sole cost and expense (hereinafter,
"Lessor's Work"). Such work involves reversing and converting the Pipeline
System from its current use to transportation of petroleum products with a
minimum capacity of 16,000 barrels per day. Lessor covenants and agrees to
perform Lessor's Work as described on Exhibit "B" in a good and workmanlike
manner, in accordance with Applicable Laws (hereinafter defined) and industry
standards and within 180 days of Lessee's providing Lessor written notice to
proceed on Lessor's Work. Lessor may continue to use the Pipeline System until
the onset of Lessor's Work prohibits it.

      3.    LEASE TERM.

            A.    Initial Term. While the Lease will be effective upon
execution, the "Initial Term" of the Lease will commence on the Commencement
Date (hereinafter defined) and expire on that day that is the tenth (10th)
anniversary thereof. The "Commencement Date" will be the earlier to occur of (i)
that date that is the first (1st) day of the sixteenth calendar (16th) month
following the date of this Lease, (ii) one hundred eighty (180) days after
Lessee has provided written notice to Lessor that Lessee desires to commence
shipments on the Pipeline System, or (iii) such earlier date as Lessee actually
commences shipments on the Pipeline System. In the event upon the occurrence of
(i) or (ii) above Lessee's shipments cannot commence by virtue of Lessor not
having fulfilled its obligations hereunder, the Commencement Date shall be
delayed until such time as Lessee is able to commence shipments.

            B.    Option to Renew. Provided that Lessee is not in default under
this Lease beyond applicable notice and cure periods at the time of the exercise
of the Option granted herein, Lessee is granted the option (the "Option") to
renew this Lease for one (1) additional term of ten (10) years (the "Renewal
Term") commencing on the next day after the expiration of the Initial Term.
Lessee shall exercise the Option, if at all, by delivering Lessor written notice
of the exercise of the Option at least one year prior to the expiration of the
Initial Term. Lessee's lease of the Pipeline System during the Renewal Term will
be upon the same terms as for the Initial Term, except that the Base Rent
(hereinafter defined) will adjust as hereinafter provided and during the Renewal
Term Lessee will have no further right to renew this Lease.

            C.    Lease Term. The "Lease Term" shall initially be the Initial
Term and, if Lessee exercises the Option, the "Lease Term" will also include the
Renewal Term.

            D.    Lease Year. As used in this Lease, a "Lease Year" shall
initially mean the twelve (12) month period commencing on the Commencement Date
and ending on the first anniversary thereof. The term "Lease Year" will
thereafter mean the successive twelve (12) month periods ending on the
anniversary of the Commencement Date.

      4.    BASE RENT.

            A.    Initial Term. Lessee agrees to pay to Lessor rent for the
Pipeline System

PIPELINE LEASE AGREEMENT--PAGE 2

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during the Initial Term in one hundred twenty (120) monthly installments, in
advance, beginning on the Commencement Date ("Base Rent"), as follows:

      -     Lease Year 1: $316,666.67 per month ($3,800,000.00 total);

      -     Lease Year 2: $341,666.67 per month ($4,100,000.00 total);

      -     Lease Year 3: $375,000.00 per month ($4,500,000.00 total);

      -     Lease Year 4: $408,333.33 per month ($4,900,000.00 total);

      -     Lease Year 5: $441,666.67 per month ($5,300,000.00 total);

Commencing Lease Year 6 of the Initial Term, and for each Lease Year of the
Initial Term thereafter, the Base Rent shall be the greater of (1) the Base Rent
for Lease Year 5 of the Initial Term or, (2) an amount determined by multiplying
the Base Rent for the immediately preceding Lease Year by the Base Rent
Adjuster. The "Base Rent Adjuster" shall be determined by dividing the Producer
Price Index for Finished Goods (as found in Table 1 of the Product Prices and
Price Indexes published by the U.S. Department of Labor, Bureau of Labor
Statistics) ("PPIFG") for the last month of the immediately preceding Lease Year
for which such index has been published by the United States Government by the
PPIFG published for the same month of the second immediately preceding Lease
Year and subtracting one one-hundredth (0.01) from the quotient so obtained. In
the event the United States Government should no longer publish the PPIFG, then
the parties shall mutually agree upon an alternative index that most nearly
captures the change in prices reflected therein for purposes of calculating the
Base Rent Adjuster.

            B.    Renewal Term. Base Rent for the first Lease Year of the
Renewal Term (the eleventh (11th) Lease Year) shall be the greater of (1)
$441,666.67, multiplied by the quotient obtained by dividing Lessor's posted
tariff for NGL movement from Group 110 to Hobbs in effect on the day the Initial
Term expires by Lessor's posted tariff for NGL movement from Group 110 to Hobbs
on the last day of the fifth (5th) Lease Year of the Initial Term, or (2) the
Base Rent in effect during the tenth (10th) Lease Year of the Initial Term
multiplied by the Base Rent Adjuster; provided, however, in no event shall the
Base Rent be less than $441,666.67. The Base Rent in effect for each subsequent
Lease Year of the Renewal Term shall be the greater of (1) the Base Rent in
effect for the first (1st) Lease Year of the Renewal Term, or (2) the Base Rent
in effect for the immediately preceding Lease Year of the Renewal Term
multiplied by the Base Rent Adjuster.

            C.    Payment of Base Rent. Each installment of Base Rent shall be
due and payable on the first day of each month. Any installment of Base Rent due
for any fractional month shall be prorated based upon the actual number of days
in that month. All obligations of Lessee measured by Lease Years shall be
prorated as appropriate based upon the number of days in the applicable Lease
Year during the term of this Lease divided by the actual number of days in such
Lease Year. Base Rent shall be paid at the times and in the amounts provided for
herein in legal tender of the United States of America to Lessor by wire
transfer of immediately available funds at the address specified in Paragraph 21
hereof or to such other person or at such other

PIPELINE LEASE AGREEMENT--PAGE 3

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address as Lessor may from time to time designate in writing.

      5.    OPERATION OF THE PIPELINE. Lessor shall at all times during the
Lease Term use all reasonable efforts to operate the Pipeline System for the
benefit of Lessee, subject to common carrier requirements as more specifically
discussed herein. Lessor shall operate the Pipeline System and Lessee shall
operate its related facilities in accordance with all Applicable Laws and in
accordance with industry standards. As used herein, the term "Applicable Laws"
means and includes any and all federal, state and local laws, ordinances,
orders, easements and right-of-way agreements of record, rules, and regulations
of all governmental bodies (state, federal, tribal and municipal) applicable to
or having jurisdiction over the use, occupancy, operation and maintenance of the
Pipeline System, as such may be amended or modified from time to time. Lessor
shall not be responsible for measurement "overs and shorts" other than for
product losses arising from fault or failure of Lessor to satisfy its
obligations hereunder.

      6.    SHIPMENTS AND TARIFFS. Lessee shall at all times during the Lease
Term be solely responsible for shipments of product and will publish and file
tariffs in its own name and in accordance with Applicable Laws covering capacity
in the Pipeline System. Lessor shall have the right to review and approve such
tariffs prior to filing, with such approval not to be unreasonably withheld.
Lessee agrees that it will not impair and at its expense will take all
reasonable steps to protect Lessor's rights under all Applicable Laws respecting
the Pipeline System to the extent such rights are materially threatened by
virtue of any act or failure to act of Lessee hereunder. In the event counsel
jointly retained by Lessor and Lessee is of the opinion that such rights are
materially threatened by virtue of an act or failure to act of Lessee, Lessee
must take all the reasonable steps as referenced above in this paragraph 6.
Lessee shall collect for its own account all revenues payable by shippers
applicable to the Pipeline System. From and after the Commencement Date,
Lessee's designated shipper(s) will be responsible for all linefill in the
Pipeline System.

      7.    ALTERATIONS BY LESSEE. Except as expressly permitted hereby, Lessee
may not alter or make any modifications to the Pipeline System without Lessor's
prior written consent, such consent not to be unreasonably withheld. Lessee may,
however, without Lessor's prior written consent, but with notice to Lessor and
at Lessee's sole cost and expense, increase the capacity of the Pipeline System
through the introduction of drag reducing agents, increased horsepower or a
combination thereof. If Lessee desires to increase capacity through any other
means it must obtain the consent of Lessor, with such consent not to be
unreasonably withheld. Lessee may elect to undertake to increase the capacity of
the Pipeline System itself, in which event Lessor shall have the right to
oversee the increase in capacity, or request that Lessor perform such, in which
event Lessee and Lessor shall mutually agree upon a reasonable cost for such
increase in capacity.

      8.    MAINTENANCE AND REPAIR. Lessor, at its sole cost and expense, shall
maintain all aspects of the Pipeline System in good condition and repair, in
accordance with Applicable Laws and in accordance with industry standards. If
any changes, modifications or

PIPELINE LEASE AGREEMENT--PAGE 4

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alterations to the Pipeline System are required during the Lease Term due to the
enactment or amendment of Applicable Laws, then Lessor shall promptly make such
changes, modifications or alterations and will bear the cost thereof.
Notwithstanding Lessor's obligation to repair and maintain the Pipeline System
at its sole cost and expense, Lessee shall be responsible for the incremental
cost of maintaining and repairing those aspects of the Pipeline System relating
solely to alterations or modifications to the Pipeline System requested or made
by Lessee for the sole purpose of increasing the capacity of the Pipeline System
as provided in Paragraph 7 above. Such costs shall be paid by Lessee within
fifteen (15) days of receipt of invoice from Lessor.

      9.    ADDITIONAL PIPELINE CONNECTIONS. Lessor hereby grants Lessee
permission to connect petroleum terminals and pipeline connections to the
Pipeline System at points at or between Lessor's White Lakes Station and Kutz
Station provided that the construction, connection, operation and maintenance of
such will be at Lessee's sole cost and expense and subject to the terms and
provisions of Exhibit B attached hereto.

      10.   REPRESENTATIONS, WARRANTIES AND COVENANTS OF LESSOR. Lessor
represents, warrants and covenants to Lessee that:

            A.    Title. Lessor has good, marketable and indefeasible title to
the Pipeline System, subject only to the easements/rights-of-way on which the
Pipeline System exists and the agreements creating same.

            B.    Organization. Lessor is duly organized, validly existing and
in good standing under the laws of the state of its organization, and is duly
qualified to transact business in the state in which the Pipeline System is
situated.

            C.    Authority. Lessor has all requisite power and authority, has
taken all actions required by its organizational documents and applicable law,
and has obtained all necessary consents, to execute and deliver this Lease and
to consummate the transactions contemplated in this Lease.

            D.    Other Agreements, etc. Neither the execution of this Agreement
nor the confirmation by Lessor of the transactions contemplated hereby will (i)
conflict with or result in any breach of the terms, conditions or provisions of,
or constitute a default under, or result in any termination of easement or
right-of-way on which the Pipeline Systems is located; (ii) violate any
restriction to which Lessor or the Pipeline System is subject; (iii) constitute
the violation of any Applicable Laws; or (iv) result in the creation of any
lien, charge or encumbrance upon the Pipeline System or any part thereof.

            E.    Proceedings. There are no attachments, executions, assignments
for the benefit of creditors, or voluntary or involuntary bankruptcy
proceedings, or under any debtor relief laws, contemplated by or pending or
threatened against Lessor or the Pipeline System.

PIPELINE LEASE AGREEMENT--PAGE 5

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            F.    Litigation. Lessor is not now a party to any material
litigation, arbitration or administrative proceeding (i) with any person or
entity having or claiming any interest in the Pipeline System, or (ii) affecting
or questioning Lessor's title to the Pipeline System or Lessor's ability to
perform its obligations under this Lease. Lessor knows of no presently pending
or threatened material litigation, arbitration or administrative proceeding
affecting or questioning Lessor's title to, or use of, the Pipeline System or
any part thereof, or Lessor's ability to perform its obligations under this
Lease.

            G.    Compliance with Laws. To the best of Lessor's knowledge and
belief, all Applicable Laws bearing on the construction or operation of the
Pipeline System have been complied with, the Pipeline System currently complies
with all Applicable Laws, and the operation of the Pipeline System as
contemplated by this Lease will not violate any such Applicable Laws.

            H.    Consents. As of the Commencement Date, no consent to the
execution or implementation of this Lease is required from any third party,
including the grantor of any easement on which the Pipeline System is located
and the owner of any right-of-way on which the Pipeline System is located.

            I.    Administrative Notices. Lessor has not received notice of, and
has no other knowledge or information of, any pending or contemplated change in
any Applicable Laws applicable to the Pipeline System, or any pending or
threatened judicial or administrative action, or any action pending or
threatened, or of any natural or artificial condition upon or affecting the
Pipeline System, or any part thereof, any of which would result in any material
change in the condition of the Pipeline System, or any part thereof, or would in
any way limit or impede the operation of the Pipeline System.

            J.    Licenses. Lessor possesses all licenses, certificates and
permits that are required to fulfill all of its obligations hereunder.

            K.    Taxes. There are no unpaid taxes, assessments or charges
against the Pipeline System.

            L.    Condemnation. Lessor has no knowledge of any condemnation,
eminent domain or similar proceedings having been instituted or threatened
against the Pipeline System.

            M.    Encumbrances. Lessor may not further encumber the Pipeline
System or any part thereof without the prior written consent of Lessee, which
consent shall not be unreasonably withheld.

            N.    True and Correct. To Lessor's best knowledge, after reasonable
inquiry, all information and other items heretofore or hereafter submitted to
Lessee by or on behalf of Lessor are true, correct and complete. Lessor is not
aware of any omission to supply Lessee with any material information or other
items with respect to the Pipeline System, its history, prospects or

PIPELINE LEASE AGREEMENT--PAGE 6

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operations, or any information which may be required to prevent the information
or other items already supplied from being misleading.

Lessor acknowledges that the execution of this Lease by Lessee has been made,
and the lease of the Pipeline System by Lessee will have been made, in material
reliance by Lessee on Lessor's representations and warranties contained in this
Paragraph 10.

      11.   REPRESENTATIONS, WARRANTIES AND COVENANTS OF LESSEE. Lessee
represents, warrants and covenants to Lessor that:

            A.    Organization. Lessee is duly organized, validly existing and
in good standing under the laws of the state of its organization, and is duly
qualified to transact business in the state in which the Pipeline System is
situated.

            B.    Authority. Lessee has all requisite power and authority, has
taken all actions required by its organizational documents and Applicable Laws,
and has obtained all necessary consents, to execute and deliver this Lease and
to consummate the transactions contemplated in this Lease.

            C.    Proceedings. There are no attachments, executions, assignments
for the benefit of creditors, or voluntary or involuntary bankruptcy
proceedings, or under any debtor relief laws, contemplated by or pending or
threatened against Lessee.

            D.    Consents. No consent to the execution or implementation of
this Lease is required from any third party.

            E.    Licenses. Lessee possesses or will possess all licenses,
certificates and permits that are required to fulfill its obligations hereunder.

            F.    Liens. Lessee has no authority, express or implied, and will
not create or place any lien or encumbrance of any kind or nature whatsoever
upon, or in any manner bind the interest of Lessor or Lessee in the Pipeline
System or charge the Rent payable hereunder for any claim in favor of any person
dealing with Lessee, including those who may furnish materials or perform labor
for any construction or repairs.

            G.    Litigation. Lessee is not now a party to any material
litigation, arbitration or administrative proceeding affecting or questioning
Lessee's ability to perform its obligation under this Lease.

            H.    True and Correct. To Lessee's best knowledge, after reasonable
inquiry, all information and other items heretofore or hereafter submitted to
Lessor by or on behalf of Lessee are true, correct and complete.

PIPELINE LEASE AGREEMENT--PAGE 7

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Lessee acknowledges that the execution of this Lease by Lessor has been made,
and the lease of the Pipeline System by Lessor will have been made, in material
reliance by Lessor on Lessee's representations and warranties contained in this
Paragraph 11.

      12.   CONTINGENCY FOR REVIEW OF RIGHT OF WAY AGREEMENTS. Lessor agrees to
provide Lessee with copies of all easement, license and right-of-way agreements
and other documents and information pertaining to the Pipeline System, its right
to exist and be operated in its current location and condition and the impact
thereof on the rights of the parties defined under this Lease. As soon as
practicable, if Lessee in good faith determines based upon a review of such
documents and information that the intent and purpose of this Lease cannot be
realized, Lessee will give Lessor written notice thereof. The parties will then
undertake to use their best efforts to overcome the impediment discovered by
Lessee to realizing the intent and purpose of this Lease. If such cannot be
resolved to Lessee's reasonable satisfaction prior to the 180 day notice
referenced in paragraph 2 above, Lessee, at its option, may elect to terminate
this Lease.

      13.   INDEMNIFICATION. Each party hereto shall indemnify, defend, protect
and hold the other free and harmless from and against any and all claims,
liabilities, damages, costs, penalties, forfeitures, losses or expenses
(including attorneys' fees) for death or injury to any person or damage to any
property whatsoever arising or resulting in whole or in part, directly or
indirectly, out of the acts or omissions of the indemnifying party or its
employees, contractors or agents or arising out of any breach by the
indemnifying party of this Lease.

      14.   POWER COSTS. Lessee will be responsible for paying all power costs
associated with the Pipeline System in accordance with Exhibit B hereto and the
method of allocation to be agreed upon within sixty (60) days of execution of
this Agreement. Such costs shall be paid by Lessee within fifteen (15) days of
receipt of invoice from Lessor.

      15.   TAXES AND ASSESSMENTS. Lessor shall be solely responsible for and
shall timely pay all taxes, charges, royalties, levies, assessments and similar
fees and charges which arise from federal or state governmental authorities,
tribal authorities, or private action (collectively, "Taxes") applicable to the
Pipeline System or the easements/rights-of-ways on which the Pipeline System is
located. However, if after the date of this Lease new Taxes are levied against
the Pipeline System or such easements/rights-of-ways, by statute or otherwise,
Lessee will reimburse Lessor for Lessee's appropriate share of such additional
Taxes. Furthermore, Lessor will not agree to any new Taxes without first
conferring with and seeking the input of Lessee.

      16.   INSURANCE.

            A.    Maintenance of Existing Coverage. Lessor and Lessee will
maintain such or similar insurance coverages in place as exist at the time of
execution of this Agreement to the extent pertinent to the respective
obligations of each herein.

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            B.    Waiver of Subrogation. Lessor and Lessee and all parties
claiming under them mutually release and discharge each other from all claims
and liabilities arising from or caused by any casualty or hazard which is
covered by insurance carried on the Pipeline System or carried in connection
with property on or activities conducted on the easements/rights-of-ways on
which the Pipeline Systems is located, and waive any right of subrogation which
might otherwise exist in or accrue to any person on account thereof.

      17.   ASSIGNMENT. This Lease may not be assigned by either party without
the prior written consent of the other party, with such consent not to be
unreasonably withheld, conditioned or delayed. The foregoing restrictions on
assignment shall not apply to (a) a transfer by a party to an affiliate; (b) a
transfer that is part of a merger or consolidation of a party or an affiliate of
a party with another entity in which the aggregate consideration for such merger
or consolidation is at least $100 million; or (c) a transfer that is part of a
broader sale of assets by a party or an affiliate of a party in which the
aggregate purchase price of such assets sold is at least $100 million. Any
assignment or purported assignment in violation of this paragraph 17 shall be
void.

      18.   SURRENDER UPON TERMINATION. Upon the expiration of the Lease Term,
Lessee shall surrender up the Pipeline System to Lessor with all of Lessee's
obligations hereunder fully performed. To the extent that Lessee has made (or
paid for) any alterations, improvements or modifications to the Pipeline System
that can be removed without damage to the Pipeline System, at Lessee's option
such shall remain the property of Lessee and Lessee may remove such at its sole
cost; provided that Lessee shall promptly repair any damage to the Pipeline
System caused thereby and ensure that after the removal of such equipment the
Pipeline System has a minimum capacity of 16,000 barrels per day. If such
improvements cannot readily be removed by Lessee without substantial damage to
or deprivation of the Pipeline System, such shall become the property of Lessor
upon the expiration of the Lease and Lessor shall pay an amount to be agreed
upon by Lessor and Lessee within thirty (30) days after the expiration of the
Lease, with such agreed upon amount not to exceed the depreciated value.

      19.   EVENTS OF DEFAULT

            A.    Events of Default by Lessor. The occurrence of any of the
following shall constitute a material default and breach of this Lease by
Lessor.

                  (1) A failure by Lessor to observe and perform any material
      provision or covenant of this Lease to be observed or performed by the
      Lessor, where such failure continues for thirty (30) days after written
      notice thereof by Lessee to Lessor, except that this thirty (30) day
      period shall be extended for a reasonable period of time if the alleged
      default is not reasonably capable of cure within said thirty (30) day
      period and Lessor proceeds to diligently cure the default.

PIPELINE LEASE AGREEMENT--PAGE 9

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                  (2) Any failure of Lessor's representations or warranties to
      remain true and correct throughout the Lease Term; provided that no event
      of default shall occur if such representation or warranty is again true
      and correct within thirty (30) days after receipt of written notice from
      Lessee.

                  (3) The making by Lessor of any general assignment for the
      benefit of creditors, the filing by or against Lessor of a petition to
      have Lessor adjudged a bankrupt, or a petition for reorganization or
      arrangement under any law relating to bankruptcy (unless, in the case of a
      petition filed against Lessor, the same is dismissed within sixty (60)
      days), the appointment of a trustee or receiver to take possession that is
      not restored to Lessor within thirty (30) days.

            B.    Events of Default by Lessee. The occurrence of any of the
following shall constitute a material default and breach of this Lease by
Lessee:

                  (1)   Any failure by Lessee to pay Rent or make any other
      payment required to be made by Lessee hereunder, where such failure
      continues for thirty (30) days after receipt of written notice from the
      Lessor, subject to the right of Lessee, reasonably exercised, to contest
      any such payment. In the event Lessee withholds any such payment, and it
      is determined that such withholding was wrongful, Lessee shall pay
      interest to Lessor on such monies wrongfully withheld at the rate of 15%
      per annum or the maximum amount allowed by law, whichever is less.

                  (2)   A failure by Lessee to observe and perform any other
      material provision or covenant of this Lease to be observed or performed
      by the Lessee, where such failure continues for thirty (30) days after
      written notice thereof by Lessor to Lessee, except that this thirty (30)
      day period shall be extended for a reasonable period of time if the
      alleged default is not reasonably capable of cure within said thirty (30)
      day period and Lessee proceeds to diligently cure the default.

                  (3)   Any failure of Lessee's representations or warranties to
      remain true and correct throughout the Lease Term; provided that no event
      of default shall occur if such representation or warranty is again true
      and correct within thirty (30) days after receipt of written notice from
      Lessor.

                  (4)   The making by Lessee of any general assignment for the
      benefit of creditors, the filing by or against Lessee of a petition to
      have Lessee adjudged a bankrupt, or a petition for reorganization or
      arrangement under any law relating to bankruptcy (unless, in the case of a
      petition filed against Lessee, the same is dismissed within sixty (60)
      days), the appointment of a trustee or receiver to take possession that is
      not restored to Lessee within thirty (30) days.

      20.   ESTOPPELS. Each party agrees, from time to time, within ten (10)
days after

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request of the other, to deliver to the requesting party, or its designee, an
estoppel certificate stating whether or not this Lease is in full force and
effect, the date to which Base Rent has been paid, the unexpired term of this
Lease and such other factual matters pertaining to this Lease as deemed
reasonably necessary by the requesting party.

      21.   NOTICES. Any notice or communication required or permitted in this
Lease shall be given in writing, sent by (a) personal delivery, or (b) expedited
delivery service with proof of delivery, or (c) United States mail, postage
prepaid, registered or certified mail, return receipt requested, addressed:

      if to Lessor, as follows:

                                Mid-America Pipeline Company
                                1800 South Baltimore
                                Tulsa, OK 74119
                                Attn: President

      and, if to Lessee, as follow

                               Navajo Pipeline Company
                               P. O. Box 159
                               Artesia, NM 88210
                               Attn: President

or to such other address or to the attention of such other person as shall be
designated by the applicable party and on fifteen (15) days notice from time to
time in writing and sent in accordance herewith. Any such notice or
communication shall be deemed to have been given either at the time of personal
delivery or, in the case of delivery service or mail, upon receipt.

      22.   RIGHT OF FIRST REFUSAL. If during the Lease Term (or any extension
thereof) or upon the termination of the Lease Lessee should receive a bona fide
third party offer expressing all material terms for the acquisition of any of
its terminals and pipelines connected to or used solely in connection with the
Pipeline System (herein the "Assets") that Lessee wishes to accept, then prior
to accepting such offer, Lessee shall first provide Lessor with notice of the
offer and its terms. Lessor will have thirty (30) days from its receipt of such
offer to elect to acquire the Assets on the same terms and conditions as are set
forth in the third party offer. If Lessor elects to purchase the Assets on such
terms, then the parties will promptly enter into a formal asset sale agreement
embodying the terms contained in the third party offer. If Lessor fails to elect
in writing to purchase the assets on the terms of the third party offer within
this thirty (30) day time period, then Lessor will have forever waived the right
of first refusal with respect to this offer. The right of first refusal granted
herein applies only to a contemplated sale of assets of Lessee in which the
Assets constitute all or substantially all of the assets subject to the sale.
Additionally, the right of first refusal shall not apply to any sale or transfer
of the Assets to an

PIPELINE LEASE AGREEMENT--PAGE 11

<PAGE>

affiliate of Lessee.

      Notwithstanding the above, the term "Assets" specifically excludes any
pipeline or terminals and related equipment constructed by Lessee and running
from Lessee's Artesia, New Mexico refinery to the Lessor's White Lakes Station.
Such pipeline, terminals and related equipment will at all times not be subject
to the foregoing right of first refusal.

      23    NO RENT ABATEMENT FOR PROBLEM AT LESSEE'S FACILITIES. In no event
shall a problem at Lessee's facilities, either its refining facilities or the
petroleum terminals and pipeline connections referenced in paragraph 9 above,
excuse Lessee's obligations to pay rent hereunder, unless and to the extent such
problem was caused or contributed to by Lessor.

      24.   LIMITATION OF LIABILITY. Neither party shall be liable for punitive
or consequential damages of any kind arising out of or in any way connected with
the performance of or failure to perform this Agreement.

      25.   MISCELLANEOUS.

            A.    Confidentiality. Provided that express consent of both parties
has been given, the parties may discuss the existence of this Agreement, but not
the particulars of its terms and conditions.

            B.    Headings/Gender. Words of any gender used in this Lease shall
be held and construed to include any other gender, and words in the singular
number shall be held to include the plural, unless the context otherwise
requires. The captions inserted in this Lease are for convenience only and in no
way define, limit or otherwise describe the scope or intent of this Lease, or
any provision hereof, or in any way affect the interpretation of this Lease.

            C.    Successors and Assigns. Without limiting the terms of
Paragraph 17 above, the terms, provisions and covenants and conditions contained
in this Lease shall apply to, inure to the benefit of, and be binding upon, the
parties hereto and upon their respective heirs, executors, personal
representatives, legal representatives, successors and assigns, except as
otherwise herein expressly provided.

            D.    Entire Agreement. This Lease constitutes the entire
understanding and agreement of the Lessor and Lessee with respect to the subject
matter of this Lease, and contains all of the covenants and agreements of Lessor
and Lessee with respect thereto. Lessor and Lessee each acknowledge that no
representations, inducements, promises or agreements, oral or written, have been
made by Lessor or Lessee, or anyone acting on behalf of Lessor or Lessee, which
are not contained herein, and any prior agreements, promises, negotiations, or
representations not expressly set forth in this Lease are of no force or effect.
This Lease may not be altered, changed or amended except by an instrument in
writing signed by both parties hereto.

PIPELINE LEASE AGREEMENT--PAGE 12

<PAGE>

            E.    Severability. If any clause or provision of this Lease is
illegal, invalid, or unenforceable under present or future laws effective during
the term of this Lease, then and in that event, it is the intention of the
parties hereto that the remainder of this Lease shall not be affected thereby,
and it is also the intention of the parties to this Lease that in lieu of each
clause or provision of this Lease that is illegal, invalid or unenforceable,
there be added, as a part of this Lease, a clause or provision as similar in
terms to such illegal, invalid or unenforceable clause or provision as may be
possible and be legal, valid and enforceable.

            F.    Date of Lease. All references in this Lease to "the date
hereof" or similar references shall be deemed to refer to the last date, in
point of time, on which all parties hereto have executed this Lease.

            G.    Counterparts. This Lease may be executed in counterparts, each
being deemed an original, but together constituting only one instrument.

            H.    Time for Performance TIME IS OF THE ESSENCE WITH RESPECT TO
ALL PERFORMANCE OBLIGATIONS CONTAINED IN THIS LEASE.

            I.    Attorneys' Fees. In the event it becomes necessary for either
party hereto to file a suit respecting the subject matters of this Lease
including without limitation to enforce this Lease or any provisions contained
herein, the party prevailing in such action shall be entitled to recover, in
addition to all other remedies or damages, reasonable attorneys' fees incurred
in such suit.

            J.    Law Governing and Venue. THIS LEASE SHALL BE GOVERNED BY THE
LAWS OF THE STATE OF NEW MEXICO WITHOUT REGARD TO ITS CONFLICT OF LAWS, AND
VENUE AND JURISDICTION FOR ANY ACTION OR PROCEEDING RESPECTING THE SUBJECT
MATTERS OF THIS LEASE INCLUDING WITHOUT LIMITATION TO ENFORCE THIS LEASE OR ANY
PROVISIONS CONTAINED HEREIN SHALL BE EXCLUSIVELY IN THE STATE AND FEDERAL COURTS
LOCATED IN ALBUQUERQUE, NEW MEXICO.

            K.    Waiver. No waiver by either party of any provision of this
Lease or of any default, event of default or breach hereunder shall be deemed to
be a waiver of any other provision of this Lease, or of any subsequent default,
event of default or breach of the same or any other provision. Either party's
consent to or approval of any act requiring consent or approval shall not be
deemed to render unnecessary the obtaining of consent to or approval of any
subsequent act requiring consent. No act or thing done by Lessor or Lessor's
agents during the term of this Lease shall be deemed an acceptance of a
surrender of the Pipeline System, unless done in writing signed by Lessor.

            L.    Interpretation. The parties hereto agree that it is their
intention hereby to

PIPELINE LEASE AGREEMENT--PAGE 13

<PAGE>

create only the relationship of Lessor and Lessee, and no provision hereof, or
act of either party hereunder, shall ever be construed as creating the
relationship of principal and agent, or a partnership, or a joint venture or
enterprise between the parties hereto.

            M.    Amendments. This Lease may not be modified or amended, except
by an agreement in writing signed by Lessor and Lessee. The parties may waive
any of the conditions contained herein or any of the obligations of the other
party hereunder, but any such waiver shall be effective only if in writing and
signed by the party waiving such conditions or obligations, except as
specifically set forth herein.

            N.    Exhibits. All exhibits referenced herein as being attached
hereto are hereby incorporated herein by reference as if set forth in full in
this Lease

      EXECUTED BY LESSOR, this 11th day of March, 1996.

                                           MID-AMERICA PIPELINE COMPANY,
                                           a Delaware corporation

                                           By: /s/ Robert G. Sachse
                                               --------------------
                                           Name:  Robert G. Sachse
                                           Title: Chairman

      EXECUTED BY LESSEE, this 8th day of March, 1996.

                                           NAVAJO PIPELINE COMPANY,
                                           a Delaware corporation

                                           By: /s/ Christopher L. Cebla
                                               ------------------------
                                           Name:  Christopher L. Cebla
                                           Title: V.P. and Secretary

Exhibits:

Exhibit A: Alignment Sheets

Exhibit B: Scope of Work & Operating Procedures

PIPELINE LEASE AGREEMENT--PAGE 14

<PAGE>

                                    EXHIBIT A

                                ALIGNMENT SHEETS

<PAGE>

<TABLE>
<CAPTION>
ALIGNMENT SHEET           MILE POSTS                   COUNTY            STATIONS
---------------           ----------                   ------            --------
<S>               <C>                           <C>                     <C>
5818-AL-16        M.P.  79.96 to M.P.  84.89    Chaves                  White Lakes
                                                                        (M.P. 80.65)
5818-AL-17        M.P.  84.89 to M.P.  90.38    Chaves
5818-AL-18        M.P.  90.38 to M.P.  95.30    Chaves
5818-AL-19        M.P.  95.30 to M.P. 100.80    Chaves
5818-AL-20        M.P. 100.80 to M.P. 106.29    Chaves
5818-AL-21        M.P. 106.29 to M.P. 111.40    Chaves
5818-AL-22        M.P. 111.40 to M.P. 116.53    Chaves
5818-AL-23        M.P. 116.53 to M.P. 121.63    Chaves
5818-AL-24        M.P. 121.63 to M.P. 126.89    Chaves
5818-AL-25        M.P. 126.89 to M.P. 132.50    Chaves & DeBaca
5818-AL-26        M.P. 132.50 to M.P. 137.99    Debaca
5818-AL-27        M.P. 137.99 to M.P. 143.47    Debaca
5818-AL-28        M.P. 143.47 to M.P. 148.58    Debaca
5818-AL-29        M.P. 148.58 to M.P. 153.69    Debaca & Lincoln
5818-AL-30        M.P. 153.69 to M.P. 158.81    Lincoln
5818-AL-31        M.P. 158.81 to M.P. 164.30    Lincoln
5818-AL-32        M.P. 164.30 to M.P. 169.81    Lincoln & Guadalupe
5818-AL-33        M.P. 169.81 to M.P. 175.38    Guadalupe
5818-AL-34        M.P. 175.38 to M.P. 180.53    Guadalupe
</TABLE>

                            EXHIBIT A-1

<PAGE>

<TABLE>
<CAPTION>
ALIGNMENT SHEET           MILE POSTS                   COUNTY            STATIONS
---------------           ----------                   ------            --------
<S>               <C>                           <C>                      <C>
5818-AL-35        M.P. 180.53 to M.P. 185.64    Guadalupe & Torrance
5818-AL-36        M.P. 185.64 to M.P. 191.16    Torrance
5818-AL-37        M.P. 191.16 to M.P. 196.46    Torrance
5818-AL-38        M.P. 196.46 to M.P. 201.57    Torrance
5818-AL-39        M.P. 201.57 to M.P. 206.88    Torrance
5818-AL-40        M.P. 206.88 to M.P. 211.99    Torrance
5818-AL-41        M.P. 211.99 to M.P. 217.25    Torrance
5818-AL-42        M.P. 217.25 to M.P. 222.58    Torrance
5818-AL-43        M.P. 222.58 to M.P. 228.07    Torrance
5818-AL-44        M.P. 228.07 to M.P. 233.35    Torrance
5818-AL-45        M.P. 233.35 to M.P. 239.38    Torrance
5818-AL-46        M.P.  239.4 to M.P.  245.9    Torrance & Sante Fe
5818-AL-47        M.P.  245.9 to M.P.  250.3    Sante Fe
5818-AL-47A       M.P.  250.3 to M.P.  252.3    Sante Fe
5818-AL-47B       M.P.  252.2 to M.P.  255.3    Sante Fe
5818-AL-48        M.P.  255.3 to M.P.  259.6    Sante Fe & Bernalillo
5818-AL-49        M.P.  259.6 to M.P.  265.3    Sandoval & Bernalillo
5818-AL-50        M.P.  265.3 to M.P.  271.0    Sandoval
5818-AL-51        M.P.  271.0 to M.P.  276.5    Sandoval
5818-AL-52        M.P.  276.5 to M.P.  281.8    Sandoval
</TABLE>

                           EXHIBIT A-2

<PAGE>

<TABLE>
<CAPTION>
ALIGNMENT SHEET           MILE POSTS                   COUNTY            STATIONS
---------------           ----------                   ------            --------
<S>               <C>                           <C>                      <C>
5818-AL-53        M.P. 281.8 to M.P. 287.2      Sandoval
5818-AL-54        M.P. 287.2 to M.P. 292.4      Sandoval
5818-AL-55        M.P. 292.4 to M.P. 298.1      Sandoval
5818-AL-56        M.P. 298.1 to M.P. 304.5      Sandoval
5818-AL-57        M.P. 304.5 to M.P. 310.6      Sandoval
5818-AL-58        M.P. 310.6 to M.P. 316.4      Sandoval
5818-AL-59        M.P. 316.4 to M.P. 322.5      Sandoval
5818-AL-60        M.P. 322.5 to M.P. 328.7      Sandoval
5818-AL-61        M.P. 328.7 to M.P. 334.7      Sandoval
5818-AL-62        M.P. 334.7 to M.P. 340.6      Sandoval
5818-AL-63        M.P. 340.6 to M.P. 346.3      Sandoval & McKinley
5818-AL-64        M.P. 346.3 to M.P. 352.1      Sandoval & McKinley
5818-AL-65        M.P. 352.1 to M.P. 357.9      Sandoval
5818-AL-66        M.P. 357.9 to M.P. 363.8      Sandoval
5818-AL-67        M.P. 363.8 to M.P. 369.8      Sandoval & Rio Arriba
5818-AL-68        M.P. 369.8 to M.P. 374.5      Rio Arriba
5819
5819-AL-69        M.P. 374.5 to M.P. 380.3      San Juan & Rio Arriba
5819-AL-70        M.P. 380.3 to M.P. 386.3      San Juan
5819-AL-71        M.P. 386.3 to M.P. 392.1      San Juan
</TABLE>

                             EXHIBIT A-3

<PAGE>

<TABLE>
<CAPTION>
ALIGNMENT SHEET        MILE POSTS                 COUNTY                 STATIONS
---------------        ----------                 ------                 --------
<S>               <C>                           <C>                     <C>
5819-AL-72        M.P. 392.1 to 398.1           San Juan
5819-AL-73        M.P. 398.1 to 403.7           San Juan
5819-AL-74        M.P. 403.7 to 409.8           San Juan
5819-AL-75        M.P. 409.8 to 415.6           San Juan                Kutz
                                                                        (M.P. 415.29)
</TABLE>

                             EXHIBIT A-4

<PAGE>

                                    EXHIBIT B

                      SCOPE OF WORK & OPERATING PROCEDURES

<PAGE>

                      SCOPE OF WORK & OPERATING PROCEDURES

                 FOUR CORNERS 8" CONVERSION TO REFINED PRODUCTS

Summary

The Four Corners 8" pipeline from Kutz Station to White Lakes Station will be
converted from LPG service to refined products service. Flow of the line will be
reversed with product entering the line at White Lakes Station and flowing
northwest to Kutz Station.

History

The 8" Four Corners line was installed in 1972 to transport LPG from northwest
New Mexico to Gaines County, Texas. This line is currently paralleled with 10"
and 12" pipelines, all transporting LPG.

Future Service

Navajo Pipeline Company will transport refined products and/or crude oil from
Artesia, New Mexico to the White Lakes Station. The 8" Four Corners line will
transport the refined products to Navajo terminals which may be constructed at
points between White Lakes Station and Kutz Station.

Pump Stations

There is one existing pump at each of four existing pump stations on the 8" line
which will be dedicated to refined products service. The pumps are located at
White Lakes, Duran, Edgewood, and San Luis pump stations. All pumps are driven
by gas turbines with the exception of Edgewood which is powered by an electric
motor. MAPL will continue to operate two pumps in LPG service at each station.

Energy costs for the dedicated pumps utilized by Navajo will be paid by Navajo
and measured with dedicated meters. Energy use for shared services (electricity
for air compressors, motorized valve operators, controls, lights, etc.) will be
allocated 1/3 Navajo and 2/3 MAPL.

Measurement

Navajo will be responsible for operations and maintenance of receipt and
delivery meters on the system. MAPL will receive pressure, temperature, flow and
gravity information from the measurement facilities for use in pipeline control.

Operation and Maintenance

MAPL will continue to operate and maintain the existing 8" line from White Lakes
Station to Kutz Station in accordance with DOT Part 195 regulations, and Navajo
will also comply with all DOT Part 195 regulations with respect to any
connections Navajo may make to the 8" Four Corners Line, MAPL Pipeline Control
in Tulsa will continue to operate and schedule the line. Navajo will operate and
maintain the line to White Lakes Station as well as any delivery terminals and
related facilities it may have constructed.

                                   EXHIBIT B-1

<PAGE>

Over Pressure Protection

Navajo will provide adequate over pressure safety devices to protect any
delivery terminals. MAPL will deliver products at pressures not to exceed 1650
psig. MAPL will provide over pressure devices for the protection of its system.
Receipt pressure at White Lakes shall not exceed 1650 psig nor shall it be less
than 150 psig.

MAPL Modifications

MAPL will make the following modifications to its system at its own expense:

     Pipeline:         The existing 8" line will be reversed to allow for flows
                       from White Lakes Station to Kutz Station. LPG will be
                       displaced from the line with nitrogen, check valves will
                       be removed and the line blinded off from the existing LPG
                       system.

     Connections:      Receipt and delivery connections will be in the form of a
                       8", 900# ANSI block valve at the White Lakes Station
                       fence and on the mainline and at the edge of the ROW at
                       terminals constructed by Navajo.

     Pumps:            Piping will be modified at White Lakes, Duran, Edgewood
                       and San Luis pump stations to allow for a dedicated pump
                       on the 8" line to pump products from White Lakes Station
                       to Kutz Station. These pumps are currently identified as
                       the "#1 blue unit" at each pump station

     SCADA:            A communications system will be installed to transmit
                       data from the delivery and receipt meters to Tulsa.

     Energy:           Meters will be installed to measure the energy used by
                       each dedicated pump.

Navajo Modifications

Navajo will make the following installations at its expense:

     Pipeline:         A products pipeline may be installed to the receipt
                       connection at White Lakes Station and to the delivery
                       connections at terminals constructed by Navajo.

     Connections:      Pipeline connections to the receipt and delivery block
                       valves will include cathodic insulation kits for
                       electrical isolation.

     Meters:           Receipt and delivery meters will be installed at Artesia
                       and at terminal interconnects constructed by Navajo.

March 7, 1996                      EXHIBIT B-2

<PAGE>

     SCADA:            Flow, temperature, pressure and gravity information will
                       be provided at the delivery and receipt meters for MAPL's
                       use in pipeline control. Adequate space and location will
                       be given within the facility for locating MAPL's
                       equipment. Electrical power will be provided to power the
                       SCADA equipment.

     Safety:           Over pressure protection devices to protect downstream
                       equipment will be installed at terminal interconnects
                       constructed by Navajo.

Linefill

Linefill from White Lakes Station to Kutz Station is approximately 116,860 bbl
and will be provided by Navajo. Navajo will also be responsible for all costs
and expense (pigs, product, inhibitors, etc.) associated with the linefill. MAPL
will perform all venting, pigging and other operational activities.

Product Quality

All products shipped within the line will meet the specifications as required
under applicable tariffs. MAPL assumes no liability for the quality of product
delivered.

Batching

Product batches will not be separated by pigs, spheres or other physical
devices. MAPL will use its best efforts to minimize interfaces or contamination
of products shipped.

Capacity Expansion

Should Navajo desire to expand the capacity of the 8" pipeline beyond its
existing 100% capacity, Navajo will bear all expenses associated with the
design, engineering, procurement, construction, fabrication, installation and
commissioning of such equipment or modifications. All modifications and or
equipment installed shall be overseen by, with the approval of and in accordance
with the specifications of MAPL.

MAPL shall operate and maintain any and all equipment installed on the 8"
pipeline or at any of the pumping stations. Should any equipment or
modifications provided for capacity expansion require additional operations or
maintenance resources or manpower above current requirements, or require any
additional utilities, consumables or chemicals, or result in an increase in
operating or maintenance expense, these additional or increased expenses shall
be the sole responsibility of Navajo and shall be reimbursed as invoiced by
MAPL. All of these costs and expenses shall be identified and agreed to during
the design phase of any such modifications or installation.

March 7, 1996                      EXHIBIT B-3<PAGE>
                                                                    EXHIBIT 10.9

                            TRANSPORTATION AGREEMENT

                                      AMONG

                          RIO GRANDE PIPELINE COMPANY,

                       AMOCO RIO GRANDE PIPELINE COMPANY,

                            JUAREZ PIPELINE COMPANY,

                             NAVAJO SOUTHERN, INC.,

                          MID-AMERICA PIPELINE COMPANY

                                       AND

                             P.M.I. TRADING LIMITED

                             DATED NOVEMBER 21, 1995

<PAGE>

                                TABLE OF CONTENTS
<Table>
<Caption>
                                                          Page No.
                                                          --------
<S>                                                       <C>
ARTICLE 1 DEFINITIONS ........................................   2

ARTICLE 2 DEVELOPMENT AND CONSTRUCTION .......................   7

     (a) The U.S. Pipeline ...................................   7

     (b) The Mexican Pipeline ................................   7

     (c) Subcontractors ......................................  10

     (d) Compliance with Mexican Laws ........................  12

     (e) Obligations of PMI ..................................  12

     (f) Completion of Improvements to the Mendez Terminal ...  15

     (g) Transfer of Risk ....................................  15

     (h) Project Team; Reporting .............................  16

     (i) Modifications .......................................  17

     (j) Warranty ............................................  17

     (k) Indemnity ...........................................  19

     (l) Taxes, Duties, Levies and Charges ...................  21

ARTICLE 3 SHIPMENTS BY PMI ...................................  22

     (a) Cumulative Volume; Yearly Committed Volume ..........  22

     (b) Additional Volume ...................................  22

ARTICLE 4 COMMON CARRIER; TARIFF .............................  23

     (a) Common Carrier ......................................  23

     (b) Tariff ..............................................  23

     (c) Tariff Modifications ................................  23

     (d) Unaffiliated Shipper ................................  26

ARTICLE 5 TRANSPORTATION CHARGES .............................  26

     (a) Volume Incentive Rate ...............................  26

     (b) Reduction of the Volume Incentive Rate ..............  27

     (c) Deficiency Payments .................................  28

     (d) Adjustments .........................................  29

ARTICLE 6 MEXICAN PIPELINE ...................................  30

ARTICLE 7 MEASUREMENT; REPORTS ...............................  32

ARTICLE 8 LIABILITY OF CERTAIN AFFILIATES ....................  33

ARTICLE 9 TIME OF COMPLETION .................................  33

</Table>

<PAGE>

<Table>
<S>                                                             <C>
ARTICLE 10 FORCE MAJEURE .....................................  35

     (a) Events of Force Majeure .............................  35

     (b) Effects .............................................  35

ARTICLE 11 PIPELINE INTERCONNECT AGREEMENT ...................  36

ARTICLE 12 ARBITRATION; GOVERNING LAW ........................  36

     (a) Settlement by Arbitration ...........................  36

     (b) Finality of Award ...................................  37

     (c) Governing Law .......................................  37

ARTICLE 13 ENTIRE AGREEMENT ..................................  37

ARTICLE 14 NO WAIVER; CUMULATIVE REMEDIES;
           LIMITATION OF LIABILITY ...........................  38

     (a) No Waiver; Cumulative Remedies ......................  38

     (b) Limitation of Liability .............................  38

ARTICLE 15 AMENDMENTS AND WAIVERS ............................  39

ARTICLE 16 ASSIGNMENT ........................................  39

ARTICLE 17 SEVERABILITY OF PROVISIONS ........................  40

ARTICLE 18 NOTICES ...........................................  40

ARTICLE 19 HEADINGS ..........................................  41

ARTICLE 20 REFERENCES ........................................  41

EXHIBITS
</Table>

                                       ii
<PAGE>

                                    EXHIBITS

EXHIBIT A           Scope of the U.S. Pipeline Project

EXHIBIT B           Scope of the Mexican Pipeline Project and the Improvements
                    to the Mendez Terminal and Specifications for the Mexican
                    Pipeline Project

EXHIBIT C           Specifications for the Improvements to the Mendez Terminal

EXHIBIT D           Product Specifications

EXHIBIT E           Form of Tariff

EXHIBIT F           Acceptance and Testing Procedures

EXHIBIT G           Insurance Requirements

EXHIBIT H           Goods and Materials to be Imported by PMI

EXHIBIT I           Goods and Materials to be Made Available on Site by PMI

EXHIBIT J           Adjustment Table

EXHIBIT K           Form of Unaffiliated Shipper Letter

<PAGE>
                            TRANSPORTATION AGREEMENT

         TRANSPORTATION AGREEMENT, dated as of November 21, 1995, by and among
RIO GRANDE PIPELINE COMPANY, a Texas general partnership ("RGPC"), represented
herein by Juarez Pipeline Company, a general partner, which is represented by
its President, R. T. Cronk, whose authority is evidenced by a duly executed
certificate signed by its Assistant Secretary, AMOCO RIO GRANDE PIPELINE
COMPANY, a Delaware corporation ("ARGPC"), represented herein by its President,
S. K. Setliff, whose authority is evidenced by a certificate duly executed by
its Secretary, JUAREZ PIPELINE COMPANY, a Delaware corporation ("JPC"),
represented herein by its President, R. T. Cronk, whose authority is evidenced
by a certificate duly executed by its Assistant Secretary, NAVAJO SOUTHERN,
INC., a Delaware corporation ("NSI"), represented herein by its President,
William J. Gray, whose authority is evidenced by a certificate duly executed by
its Assistant Secretary, MID-AMERICA PIPELINE COMPANY, a Delaware corporation,
in its individual capacity ("MAPL") and represented herein by its President, R.
T. Cronk, whose authority is evidenced by a certificate duly executed by its
Assistant Secretary, and P.M.I. TRADING LIMITED, an Irish corporation ("PMI"),
represented herein by its Director General, Eduardo Martinez del Rio, whose
authority is evidenced by a resolution of its Board of Directors duly notarized
in Mexico City, Mexico.

                                   WITNESSETH

         WHEREAS, PMI intends to enter into agreements with third parties
pursuant

<PAGE>

to which PMI will purchase certain quantities of LPG for export to the
Mendez Terminal;

         WHEREAS, PMI has agreed to transport or cause to be transported certain
minimum quantities of such LPG through the U.S. Pipeline which shall be operated
by RGPC and shall connect with the Mexican Pipeline;

         WHEREAS, MAPL has agreed with RGPC to provide the transportation
services contemplated to be provided by RGPC by this Agreement and shall publish
the Tariff jointly with RGPC; and

         WHEREAS, RGPC also has agreed to construct and to deliver to Pemex,
without any charge to PMI or any PMI Designated Affiliate, the Mexican Pipeline
and the Improvements to the Mendez Terminal, subject to the terms and conditions
of this Agreement.

         NOW, THEREFORE, in consideration of the premises and the mutual
covenants hereinafter set forth, the parties hereby agree as follows:

                                    ARTICLE 1

                                   DEFINITIONS

         For purposes of this Agreement, the following terms shall have the
meanings indicated below which shall be equally applicable to the singular and
plural forms thereof:

                 (a) "AFFILIATE" shall mean, with respect to any Person, any
other Person or a group of Persons which directly or indirectly Controls, or is
under common Control with, or is Controlled by such Person;

                 (b) "AGREEMENT" shall mean this Transportation Agreement,
including all

                                       2
<PAGE>

                     Exhibits hereto, as the same may be amended from time to
time;

                 (c) "BPD" shall mean barrels per Day;

                 (d) "CONTROL" (including the correlative terms "controlled by",
"controlling", and "under common control with") shall mean, with respect to any
Person, possession of the power, directly or indirectly, to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise;

                 (e) "CUMULATIVE VOLUME" shall mean 45.625 million barrels;

                 (f) "DAY" shall mean a calendar day;

                 (g) "DELIVERY PERIOD" shall mean the period commencing with the
earlier of (i) the date on which Start-Up of Operations shall occur or (ii) the
date which is 630 Days after the date of this Agreement, and ending on the tenth
anniversary date of the commencement;

                 (h) "DELIVERY YEAR" shall mean each consecutive 365-Day period
commencing with the start of the Delivery Period and occurring within the
Delivery Period or such shorter consecutive Day period ending on the Day the
Cumulative Volume shall have been shipped;

                 (i) "EL PASO LINE" shall mean the new, approximately fifteen
(15) mile, eight (8) inch diameter petroleum products pipeline running from a
point of connection with the NSI line to the point on the U.S./Mexico border, as
generally described in Exhibit A, to be constructed by RGPC pursuant to Article
2 of this Agreement;

                 (j) "FERC" shall mean the United States Federal Energy
Regulatory

                                       3
<PAGE>
Commission;

                 (k) "GOVERNMENTAL BODY" shall mean any national, state,
municipal, or other local government, any subdivision, agency, court, commission
or authority thereof, or any quasi-governmental or private body exercising any
regulatory or taxing authority thereunder;

                 (1) "ICA" shall mean the United States Interstate Commerce Act,
49 U.S.C. Section 1, et seq.;

                 (m) "IMPROVEMENTS TO THE MENDEZ TERMINAL" shall mean the
completion of the Mendez Terminal to accept deliveries of LPG in accordance with
the scope set forth in Exhibit B and the specifications set forth in Exhibit C,
as such Exhibits may be modified in accordance with this Agreement, including,
without limiting the generality of the foregoing, the construction of the
pipeline connection and associated measurement equipment, six (6) truck loading
spots, two (2) truck unloading spots, buildings necessary for operation of the
Mexican Pipeline and the Mendez Terminal, and safety and odorization systems;

                 (n) "JOINT VENTURE PARTICIPANTS" shall mean ARGPC, JPC and NSI
in their respective individual capacities;

                 (o) "JOINT VENTURE PARTICIPANT PARENT" shall mean, with respect
to ARGPC, Amoco Pipeline Company, a Maine corporation; with respect to JPC,
Mid-America Pipeline Company, a Delaware corporation; and with respect to NSI,
Navajo Refining Company, a Delaware corporation;

                 (p) "LPG" shall mean propane or a blend of propane and butane
meeting

                                       4
<PAGE>

the specifications set forth in Exhibit D having a composition in the range of
70%/30% propane to butane to 100% propane;

                 (q) "MAPL LINE" shall mean the existing eight (8) inch diameter
petroleum products pipeline running from Hobbs to Odessa, Texas, as generally
described in Exhibit A, and currently owned and operated by MAPL;

                 (r) "MENDEZ TERMINAL" shall mean the Pemex LPG terminal located
in Mendez, State of Chihuahua, Mexico;

                 (s) "MEXICAN PIPELINE" shall mean the new, approximately 14.5
mile, eight (8) inch diameter petroleum products pipeline, which shall be
constructed by RGPC in accordance with Article 2 of this Agreement, running from
a point of connection with the El Paso line on the U.S./Mexico border to the
Mendez Terminal, as generally described and meeting the specifications in
Exhibit B, as such Exhibit may be modified in accordance with this Agreement;

                 (t) "MEXICO" shall mean the United Mexican States;

                 (u) "MONTH" shall mean a calendar month;

                 (v) "NSI LINE" shall mean the existing, approximately 220 miles
of eight (8) inch diameter pipeline running from the point of interconnection
with the MAPL line near Odessa to Milepost 192 near El Paso, Texas, as generally
described in Exhibit A, that is currently owned by Navajo Pipeline Company and
used for refined products, and that is to be converted to LPG use by RGPC
pursuant to Article 2 of this Agreement;

                 (w) "PEMEX" shall mean Pemex Gas y Petroquimica Basica, a
decentralized public agency of the Government of Mexico;

                                       5
<PAGE>

                 (x) "PERSON" shall mean any individual, corporation, trust,
partnership, association, joint venture, other business entity, or Governmental
Body;

                 (y) "PIPELINE INTERCONNECT AGREEMENT" shall mean the Pipeline
Interconnect Agreement, to be entered into between RGPC and a PMI Designated
Affiliate pursuant to Article 11 of this Agreement;

                 (z) "PMI DESIGNATED AFFILIATE" shall mean an Affiliate of PMI
(including, without limitation, Pemex) which PMI shall notify RGPC as a
transferee or assignee of any of PMI's rights or obligations under this
Agreement;

                 (aa) "START-UP OF OPERATIONS" shall mean the commencement of
continuous operations of the Mexican Pipeline and the Mendez Terminal to receive
LPG from the interconnection point with the U.S. Pipeline upon the issuance of
the acceptance certificates in accordance with Articles 2(e)(vi) and 2(e)(vii);

                 (ab) "TARIFF" shall mean the tariff, substantially in the form
of Exhibit E, to be used by RGPC pursuant to FERC regulations for transportation
services on the U.S. Pipeline, as may be revised from time to time in accordance
with applicable FERC regulations and the terms of this Agreement;

                 (ac) "UNITED STATES" or "U.S." shall mean the United States of
America;

                 (ad) "U.S. PIPELINE" shall mean the eight (8) inch diameter
petroleum products pipeline to be developed by RGPC in accordance with Article 2
of this Agreement (including the integration of the MAPL line, the NSI line and
the El Paso line) and running from Hobbs to a point of connection on the United
States/Mexico border, as generally described in Exhibit A;

                                       6
<PAGE>

                 (ae) "U.S. DOLLARS" or "U.S.$" shall mean dollars of the United
States; and

                 (af) "YEARLY COMMITTED VOLUME" shall mean, for each Delivery
Year, 4.5625 million barrels shipped in accordance with Article 3(a).

                                    ARTICLE 2

                          DEVELOPMENT AND CONSTRUCTION

         (a) THE U.S. PIPELINE. RGPC, at its sole cost and expense, shall
construct, integrate and otherwise develop the U.S. Pipeline in accordance with
(i) generally accepted practices of the industry and trades involved and (ii)
the project scope jointly established in Exhibit A. RGPC shall ensure that the
U.S. Pipeline complies with the terms and conditions of this Agreement, is
complete in every respect and ready for use in the manner indicated or
manifestly implied in this Agreement and is generally safe to operate and
maintain.

         (b) THE MEXICAN PIPELINE AND THE IMPROVEMENTS TO THE MENDEZ TERMINAL.
Except as provided in Article 2(e), RGPC, at its sole cost and expense, shall
construct, integrate and otherwise develop the Mexican Pipeline and the
Improvements to the Mendez Terminal in accordance with generally accepted
practices of the industry and trades involved; the project scope jointly
established in Exhibit B; and the respective specifications contained in
Exhibits B and C. If and to the extent that the parties shall mutually determine
that any modifications to either or both of Exhibit B and Exhibit C is required,
the parties shall so modify such Exhibits; provided, however, that any such
modification shall be made not later than ninety (90) Days after the date of
this Agreement. RGPC shall ensure that the

                                       7
<PAGE>

Mexican Pipeline and the Improvements to the Mendez Terminal in each case
complies with the terms and conditions of this Agreement, is complete in every
respect and ready for use in the manner indicated or manifestly implied in this
Agreement and is generally safe to operate and maintain. Without limiting the
generality of the foregoing, the obligations of RGPC in carrying out the
construction of the Mexican Pipeline and the Improvements to the Mendez Terminal
shall include:

                  (i)      developing the basic engineering and detailed
                           engineering for the Mexican Pipeline and the
                           Improvements to the Mendez Terminal based on the
                           respective specifications contained in Exhibits B and
                           C, as such Exhibits may be modified in accordance
                           with this Agreement;

                  (ii)     constructing the Mexican Pipeline and integrating it
                           with the El Paso line and the Mendez Terminal;

                  (iii)    constructing the Improvements to the Mendez Terminal;

                  (iv)     installing a supervisory control and data acquisition
                           system (SCADA) consistent with that used for the U.S.
                           Pipeline;

                  (v)      except to the extent that PMI provides any such
                           materials in accordance with this Agreement,
                           procuring and supplying all materials for the Mexican
                           Pipeline and the Improvements to the Mendez Terminal
                           in conformity with the respective specifications
                           contained in Exhibits B and C, as such Exhibits may
                           be modified in accordance with this Agreement;

                                       8
<PAGE>

                  (vi)     providing for all inspections and testing of
                           materials during fabrication or preparation and on
                           site;

                  (vii)    providing all civil works in connection with the
                           construction of the Mexican Pipeline and the
                           Improvements to the Mendez Terminal;

                  (viii)   providing, or causing to be provided, all management,
                           labor, equipment, materials, tools, consumables and
                           facilities required to perform its obligations
                           hereunder;

                  (ix)     conducting and successfully completing the
                           performance testing of the Mexican Pipeline and the
                           Improvements to the Mendez Terminal in accordance
                           with the procedures set forth in Exhibit F hereto;

                  (x)      providing PMI or a PMI Designated Affiliate with all
                           documents, manuals, instructions and training
                           necessary to operate, manage, repair and maintain the
                           Mexican Pipeline and the Improvements to the Mendez
                           Terminal at optimum capacity and efficiency, in the
                           most economical way and in accordance with the
                           generally accepted safety standards of the pipeline
                           industry (it being understood that the applicable
                           training methodology, procedures and certifications
                           will be set forth definitively in the Pipeline
                           Interconnect Agreement);

                  (xi)     granting or causing to be granted to PMI or a PMI
                           Designated Affiliate any necessary patent rights and
                           licenses for the

                                       9
<PAGE>

                           operation of the Mexican Pipeline and the
                           Improvements to the Mendez Terminal; and

                  (xii)    replacing or repairing such parts of the Mexican
                           Pipeline and the Improvements to the Mendez Terminal
                           as shall be found to be defective or unsound prior to
                           acceptance by PMI or a PMI Designated Affiliate.

         It is expressly understood that the obligations of RGPC under this
Agreement shall include and provide for all works which are not explicitly set
forth or described herein, but which are necessary or appropriate in the
judgment of RGPC and PMI, the inclusion of which such works shall be based on
mutually agreeable terms on cost and scheduling for the successful construction,
testing and start up of the Mexican Pipeline and the Improvements to the Mendez
Terminal in accordance with this Agreement.

         (c) SUBCONTRACTORS. In performing any of its obligations hereunder,
RGPC may subcontract the whole or any part of the work to be performed by it to
reputable subcontractors; provided, however, that RGPC shall (i) remain solely
responsible for the quality and the proper and timely execution of the work as
if such subcontracting had not taken place and (ii) be fully liable for the
acts, defaults, omissions and negligence of any and all subcontractors, their
respective agents, employees and workers. RGPC shall require its contractors,
affiliate subcontractors and any other party engaged to discharge the
obligations of RGPC under this Agreement to:

                  (i)      have full regard for the safety of all persons
                           entitled to be upon the sites, keep the sites (so far
                           as the same is under its control) in an orderly state
                           appropriate for the avoidance of danger to

                                       10
<PAGE>

                           such persons, and, in addition thereto with respect
                           to any work to be performed in Mexico, comply with
                           Pemex's Reglamento de Seguridad e Higiene, a copy of
                           which has been furnished to RGPC;

                  (ii)     provide and maintain at their own cost all safety
                           equipment, lights, guards, fencing and warning signs,
                           when and where necessary or, with respect to any work
                           to be performed in Mexico, as may be from time to
                           time reasonably required by PMI or a PMI Designated
                           Affiliate, or by any duly constituted authority for
                           the protection of the Mexican Pipeline or the Mendez
                           Terminal or for the safety and convenience of the
                           public or others;

                  (iii)    keep the sites reasonably free from all unnecessary
                           obstructions, store or dispose of contractors'
                           equipment and surplus materials, and clear away and
                           remove from the sites any wreckage, rubbish or
                           materials no longer required and occasioned by the
                           performance of RGPC or its subcontractors of the
                           obligations of RGPC under this Agreement;

                  (iv)     take all reasonable steps to protect the environment
                           on and off the sites and to avoid causing damage or
                           nuisance or committing waste to persons or to
                           property of the public or others resulting from
                           pollution, noise or other causes arising as

                                       11
<PAGE>
                           consequence of its methods of construction; and

                  (v)      maintain in force throughout the period beginning
                           with the commencement of construction and ending upon
                           final acceptance by PMI or a PMI Designated Affiliate
                           of the Mexican Pipeline and the Improvements to the
                           Mendez Terminal, all insurance coverage required to
                           be maintained in accordance with Exhibit G or such
                           other coverage as Pemex may from time to time
                           generally require in connection with its construction
                           projects, which such coverage shall be provided by
                           such insurers as PMI or any PMI Designated Affiliate
                           may consent to in writing, which such consent shall
                           not be unreasonably withheld.

         (d) COMPLIANCE WITH MEXICAN LAWS. RGPC shall perform its obligations
hereunder with respect to the Mexican Pipeline and the Improvements to the
Mendez Terminal in strict compliance with all local, state and national laws,
rules, codes and regulations in force in Mexico at the time of signature of this
Agreement and from time to time thereafter enacted and published, including
without limitation, labor laws. RGPC shall cause all contractors and
subcontractors to acknowledge and observe all such laws, rules, codes and
regulations, and shall assure that all required licenses and permits are
obtained prior to and maintained until final acceptance of the Mexican Pipeline
and the Improvements to the Mendez Terminal by PMI or the PMI Designated
Affiliates.

         (e) OBLIGATIONS OF PMI. PMI shall cooperate, directly or through the
assistance

                                       12
<PAGE>

of PMI Designated Affiliates, with RGPC in the construction of the Mexican
Pipeline and the Improvements to the Mendez Terminal by:

                  (i)      defining the routing of the Mexican Pipeline and
                           acquiring, or causing to be acquired, as promptly as
                           possible, all easements, rights of way, rights of
                           passage, permits, licenses and other governmental
                           authorizations and approvals necessary for the
                           construction of the Mexican Pipeline and the
                           Improvements to the Mendez Terminal by RGPC;

                  (ii)     assisting RGPC generally in complying with Mexican
                           law and, to the extent possible, in resolving
                           disputes that may arise in the construction of the
                           Mexican Pipeline and the Improvements to the Mendez
                           Terminal (it being understood that, notwithstanding
                           the foregoing, RGPC shall be responsible in all
                           respects for complying with all applicable Mexican
                           laws except to the extent that any non-compliance is
                           caused or contributed to by the negligence or willful
                           misconduct of PMI or any PMI Designated Affiliate and
                           such non-compliance could not have been avoided by
                           the exercise by RGPC of reasonable care, in which
                           case each party shall bear liability in proportion to
                           its fault);

                  (iii)    providing to RGPC copies of, or access to, existing
                           engineering plans and other documents relating to the
                           construction of the Mendez Terminal that are in the
                           possession of PMI or Pemex;

                                       13
<PAGE>

                  (iv)     importing into Mexico and entrusting to RGPC during
                           the period of construction of the Mexican Pipeline
                           and the Improvements to the Mendez Terminal, those
                           goods and materials specified in Exhibit H and such
                           other goods and materials as may, from time to time,
                           be required in connection with the construction of
                           the Mexican Pipeline and the Improvements to the
                           Mendez Terminal and which shall be used by RGPC
                           solely in the discharge of its obligations under this
                           Agreement; it being understood that, if such goods
                           and materials are acquired in the first instance by
                           RGPC, title thereto shall pass to PMI or a PMI
                           Designated Affiliate at or prior to the U.S./Mexico
                           border, at no cost to PMI or such PMI Designated
                           Affiliate, and that RGPC shall bear all risk and
                           liability with respect to such goods and materials up
                           to acceptance of the Mexican Pipeline and the
                           Improvements to the Mendez Terminal, notwithstanding
                           the fact that PMI shall be the importer of record of
                           such goods and materials;

                  (v)      making available to RGPC for use in the construction
                           of the Improvements to the Mendez Terminal such goods
                           and materials of the type described in Exhibit I as
                           PMI and RGPC may, from time to time, mutually agree;

                  (vi)     issuing and delivering to RGPC the acceptance
                           certificate for

                                       14
<PAGE>

                           those Improvements to the Mendez Terminal specified
                           in Exhibit F ("Mendez Terminal" section) required for
                           expansion of its capacity to accept truck deliveries
                           within a period of two (2) weeks after successful
                           completion of the performance tests for such
                           Improvements set forth in Exhibit F (it being
                           understood that the issuance of such acceptance
                           certificate shall not release RGPC from its
                           obligations under Article 2(j); and

                  (vii)    issuing and delivering to RGPC the acceptance
                           certificate for the Mexican Pipeline and the
                           Improvements to the Mendez Terminal specified in
                           Exhibit F, within a period of two (2) weeks after
                           the successful completion of the performance tests
                           for the Mexican Pipeline and the Improvements to the
                           Mendez Terminal set forth therein (it being
                           understood that the issuance of such acceptance
                           certificate shall not release RGPC from its
                           obligations with respect to hidden defects in the
                           Mexican Pipeline and the Improvements to the Mendez
                           Terminal under Article 2(j)).

         (f) COMPLETION OF IMPROVEMENTS TO THE MENDEZ TERMINAL. Subject to the
provisions of Article 10, RGPC shall complete construction of the Improvements
to the Mendez Terminal in accordance with the specifications in Exhibit C and
perform the tests set forth in Exhibit F not later than 270 Days from the date
of this Agreement.

         (g) TRANSFER OF RISK. Except as otherwise contemplated by this
Agreement, upon

                                       15
<PAGE>

issuance of the acceptance certificates referred to in Articles 2(e)(vi) and
(vii), risk of loss, damage and civil property liability with respect to the
corresponding facilities, shall pass to PMI or its PMI Designated Affiliate,
free of any charge or cost to PMI or such PMI Designated Affiliate which shall
have the sole ownership of the Mexican Pipeline or the Improvements to the
Mendez Terminal, as the case may be. RGPC shall execute such documents and take
such steps as may be reasonably requested by PMI or the PMI Designated
Affiliates to disclaim any ownership interest in or any claim against the
Mexican Pipeline, the Mendez Terminal or the Improvements to the Mendez Terminal
except for any rights that may be granted to RGPC pursuant to Article 6.

         (h) PROJECT TEAM; REPORTING. PMI shall form a project team which will
have the right to consult with RGPC's project management and request and receive
all information relating to all aspects of the project, as well as to witness
tests performed on the Mexican Pipeline and the Improvements to the Mendez
Terminal. On or before the fifteenth Day of each Month, RGPC shall provide to
the project team a detailed report showing the progress of the work performed
during the preceding Month, including the status of permits and approvals,
engineering procurement and construction, and indicating any difficulties which
may cause delay in the project and the action proposed to be taken by RGPC to
deal with such difficulties. On or before the fifteenth Day of each Month, PMI
or its PMII Designated Affiliate shall provide a report to RGPC showing the
status of all easements, rights of way, rights of passage, permits, licenses and
other governmental authorizations and approvals to be acquired by PMI in
accordance with Article 2(e)(i). Except with respect to PMI's performance of its
obligations under Article 2(e), it is expressly understood that

                                       16
<PAGE>

RGPC shall have sole responsibility for the project management and execution,
and that the foregoing rights of PMI and the PMI Designated Affiliates to
receive information and consult with RGPC shall not in any way limit the
responsibility of RGPC for proper completion of the Mexican Pipeline and the
Improvements to the Mendez Terminal.

         (i) MODIFICATIONS. Any modifications to drawings, documents and
specifications constituting the basis for the project design of the Mexican
Pipeline and the Improvements to the Mendez Terminal and not otherwise
contemplated by Article 2(b) shall be jointly approved in a timely manner by
RGPC and PMI (or by a PMI Designated Affiliate) and shall only be modified with
the approval of PMI's project team. RGPC shall propose any of its standards, new
or different approaches to design, and mechanical specifications where such
alternatives will reduce costs, improve the schedule and reliability, or
otherwise benefit the project. All such proposals should be brought to the
attention of PMI's project team as early as possible in order to avoid any delay
in RGPC's design progress.

         (j) WARRANTY. (i) RGPC warrants to PMI that all workmanship performed
in connection with this Agreement shall be in strict conformity with the
respective specifications contained in Exhibits B and C, as the same may be
modified in accordance with this Agreement, with respect to the Mexican Pipeline
and the Improvements to the Mendez Terminal and otherwise in accordance with
accepted industry standards. This warranty shall apply to any nonconformity or
defect in workmanship that is discovered within twelve (12) Months after the
date of issuance of the acceptance certificates referred to in Articles 2(e)(vi)
and 2(e)(vii). PMI shall notify RGPC in writing, by telephone or telex,
confirmed in writing, whenever PMI discovers a nonconformity or defect covered
by

                                       17
<PAGE>

this warranty. RGPC shall promptly propose a method of correcting the
nonconformity or defect which meets the requirements of this Agreement. PMI, at
its sole discretion, may elect to have RGPC complete any proposed repair or
replacement, or, with RGPC's prior approval, which shall not be unreasonably
withheld, perform any repair or replacement itself. All costs and expenses
incurred in connection with any repair or replacement made pursuant to this
warranty shall be for the account of RGPC. PMI may assign its rights under this
Article 2(j) to any of its Affiliates.

                 (ii) With respect to goods or materials used in connection with
the construction of the Improvements to the Mendez Terminal or the Mexican
Pipeline (other than any goods or materials which may be supplied by PMI or its
PMI Designated Affiliate in accordance with this Agreement) RGPC shall secure
from the vendors thereof such warranties as are customarily made by such vendors
in connection with work similar to that to be performed under this Agreement.
RGPC shall use its best efforts to cause such warranties to be assigned to PMI
or its PMI Designated Affiliate. If and to the extent that RGPC is unable to
assign any such warranty to PMI or its PMI Designated Affiliate, RGPC, for so
long as any rights may exist under such warranty, shall hold such warranty in
trust for the benefit of PMI or its PMI Designated Affiliate, and, at the
request and expense of PMI or its PMI Designated Affiliate, shall enforce the
rights granted under such warranty. RGPC shall notify PMI or its PMI Designated
Affiliate of the expiration date of any unassigned warranty not later than
thirty (30) Days prior to such expiration date and, at the request and expense
of PMI or its PMI Designated Affiliate, shall exercise any option or other right
to extend such warranty.

                                       18
<PAGE>

             (iii) Neither PMI nor any PMI Designated Affiliate shall have any
liability whatsoever to RGPC, any of the Joint Venture Participants or any of
RGPC's contractors, subcontractors and their respective agents, employees or
workers with respect to any defect in any goods or materials provided to RGPC
for use in the construction of the Mexican Pipeline or the Improvements to the
Mendez Terminal. IT IS UNDERSTOOD AND AGREED BY RGPC THAT PMI MAKES NO WARRANTY,
EITHER EXPRESS OR IMPLIED, OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE OF ANY GOODS OR MATERIALS PROVIDED TO RGPC PURSUANT TO THIS AGREEMENT.
Notwithstanding the foregoing, PMI or its PMI Designated Affiliate, as the case
may be, shall undertake to enforce any warranty given with respect to such goods
or materials by the vendors thereof.

             (iv) EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, RGPC MAKES NO
OTHER WARRANTY, EITHER EXPRESS OR IMPLIED, WITH RESPECT TO ITS WORKMANSHIP OR
ANY GOODS OR MATERIALS, INCLUDING WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE. Neither RGPC nor any Joint Venture Participant shall have
any liability to PMI, its PMI Designated Affiliate or any of their respective
agents, employees or workers for any defect or nonconformity in any goods or
materials used in connection with the construction of the Improvements to the
Mendez Terminal or the Mexican Pipeline which such defect or nonconformity would
not be identifiable in the course of using generally accepted industry practices
or in applying the specifications set forth in Exhibits B and C.

         (k)      INDEMNITY. (i) RGPC, and each of the Joint Venture
                  Participants in its

                                       19
<PAGE>

individual capacity, jointly and severally, shall indemnify and hold harmless
PMI and each of its Affiliates, and their respective officers, directors,
agents and representatives, from and against any and all actions, suits, claims,
demands, losses, damages, costs and expenses, including attorney's fees and
court costs, and other liabilities of any kind arising out of or in connection
with any of the following, except to the extent that the same shall have been
caused or contributed to by the negligence or willful misconduct of PMI or any
PMI Designated Affiliate in which case each party shall bear liability in
proportion to its fault:

         (A)      any damage or injury to any person or to any property which
                  may arise out of or in consequence of the performance or
                  nonperformance of RGPC's obligations hereunder by RGPC or any
                  subcontractors engaged by RGPC and their respective agents,
                  workers and personnel;

         (B)      any injury suffered by the employees, agents, invitees or
                  licensees of RGPC or any subcontractor;

         (C)      any infringement of any patent, trademark or other protected
                  rights used in connection with or for incorporation into the
                  U.S. Pipeline, the Mexican Pipeline or the Improvements to the
                  Mendez Terminal; and

         (D)      any violation by RGPC, its contractors or subcontractors of
                  any statute, law, rule, regulation or order of any duly
                  constituted authority that may be applicable to the U.S.
                  Pipeline, the Mexican Pipeline or the Improvements to the
                  Mendez Terminal

                                       20
<PAGE>

                  or the performance of the obligations of RGPC hereunder,
                  including, without limitation, any statute, law, rule,
                  regulation or order applicable to the environment or the
                  generation, handling, storage, transportation, release or
                  disposal of any substance which is the subject of regulation
                  by a Governmental Body.

         PMI may assign its rights under this Article 2(k) to any PMI Designated
Affiliate.

         (ii) PMI or its PMI Designated Affiliate shall indemnify and hold
harmless RGPC, its contractors, subcontractors and their respective officers,
directors, agents and representatives from and against any and all actions,
suits, claims, demands, losses, damages and expenses, including attorney's fees
and court costs, and other liabilities of any kind as a result of and to the
extent that any such action, suit, claim, demand, loss, expense or liability
arises out of environmental conditions at the Mendez Terminal existing as of the
date of this Agreement.

         (l) TAXES, DUTIES, LEVIES AND CHARGES. RGPC shall bear and pay all
taxes, duties, levies, fees, tariffs, and charges of any nature, now existing or
which may hereafter come into effect, imposed by any Governmental Body on RGPC,
its subcontractors or their respective agents, employees and workers in
connection with the entering into or performance of this Agreement, including
without limitation, the following:

                  (i)      taxes and levies on wages and salaries of, and other
                           payments to personnel and all applicable social
                           insurance contributions and labor charges; and

                                       21
<PAGE>

                  (ii)     customs and import duties and value added taxes
                           (Impuesto al Valor Agregado) which may become due
                           upon the importation into Mexico of materials and
                           equipment for construction of the Mexican Pipeline
                           (except such duties and taxes imposed upon those
                           goods and materials provided or made available by PMI
                           in accordance with this Agreement which shall be
                           borne by PMI).

                                    ARTICLE 3

                                SHIPMENTS BY PMI

         (a) CUMULATIVE VOLUME; YEARLY COMMITTED VOLUME. During the Delivery
Period, PMI agrees to ship or cause to be shipped through the U.S. Pipeline the
Cumulative Volume. For each Delivery Year, shipments constituting the Yearly
Committed Volume shall average not less than 12,500 BPD on a ratable basis and
shall be within the capabilities of the system capacity of 24,000 BPD (or such
larger capacity as the U.S. Pipeline may have at a later date) until the
Cumulative Volume is shipped. All shipments are to be made in accordance with
the Tariff as applicable on the date of shipment. Notwithstanding the foregoing,
it is agreed and understood that any volumes delivered in accordance with
Article 9(b) shall constitute volumes shipped by or on behalf of PMI in
satisfaction of its obligations to ship the Cumulative Volume and Yearly
Committed Volumes.

         (b) ADDITIONAL VOLUME. During the Delivery Period, PMI shall take
commercially

                                       22
<PAGE>

reasonable steps to increase its shipments through the U.S. Pipeline up to
16,000 BPD if it (x) has demand from Mexican buyers for imports of LPG from the
U.S. to the State of Chihuahua and (y) is able to acquire LPG for delivery
through the U.S. Pipeline to the Mendez Terminal at a delivered price no less
favorable than would be available through alternative methods of delivery to the
Mendez Terminal.

                                    ARTICLE 4

                             COMMON CARRIER; TARIFF

         (a) COMMON CARRIER. RGPC represents that the U.S. Pipeline will be
subject to the provisions of the ICA and, as such, will be operated as a
"common carrier" thereunder. Subject to the provisions of the ICA, RGPC shall
operate, or cause to be operated, the U.S. Pipeline so as to allow PMI, and any
shipper consigning products to or for the benefit of PMI, to fulfill PMI's
obligations under this Agreement.

         (b) TARIFF. Prior to commencement of operations on the U.S. Pipeline,
but in time sufficient to commence operation of the U.S. Pipeline upon
completion thereof and the Mexican Pipeline, MAPL and RGPC shall file or cause
to be filed a tariff for transportation services on the U.S. Pipeline
substantially in the form of the Tariff set forth in Exhibit E. In accordance
with FERC regulations, RGPC shall simultaneously notify all shippers and
subscribers of record, including PMI, under the Tariff applicable to the U.S.
Pipeline of any change to the rules, regulations, and conditions of any Tariff
prior to the filing thereof.

         (c) TARIFF MODIFICATIONS. (i) Except as specifically set forth below in
Article 4(c)(ii), neither MAPL nor RGPC shall, at any time during the Delivery
Period, increase

                                       23
<PAGE>

the volume incentive rate of U.S.$1.68 per barrel for an annual volume
commitment of 12,500 BPD on a ratable basis. In addition to the foregoing,
neither MAPL nor RGPC shall, except with the prior written consent of PMI,
voluntarily modify any of the terms of the Tariff in a manner which would
adversely affect the rights of PMI or its designated shipper under this
Agreement. Without limiting the generality of the foregoing, neither MAPL nor
RGPC shall modify any of the following terms of the Tariff except with the prior
written consent of PMI.

                  (A)      Shippers shall be required to have title to product
                           while in transit;

                  (B)      Each shipper shall hold a minimum inventory volume in
                           the U.S. Pipeline equal to such shipper's aggregate
                           volume of receipts for the immediately preceding
                           seven (7) Days;

                  (C)      Subject to scheduling, product received by RGPC for a
                           shipper's account shall be available for delivery
                           seven (7) Days after the Day of receipt;

                  (D)      Shippers shall be invoiced upon delivery to the
                           interconnection point on the U.S./Mexico border with
                           payment due in U.S. currency net fourteen (14) Days
                           after the date of invoice;

                  (E)      MAPL shall provide to each shipper twenty-one (21)
                           Days of free storage of product at its Hobbs, Texas
                           facility for a quantity of product based upon the
                           greater of such shipper's daily average throughput
                           for the past twelve (12) Months to the

                                       24
<PAGE>

                           interconnection point at the U.S./Mexico border, or
                           such shipper's annual volume commitment expressed as
                           a daily average;

                  (F)      Shippers shall have the right to lease storage on the
                           MAPL system; and

                  (G)      Product movements shall be subject to carrier
                           scheduling and minimum batch size requirements which
                           would be determined in accordance with operational
                           and scheduling requirements of the U.S. Pipeline.

It is agreed and understood that PMI shall not have the right to consent to any
modification to the Tariff to the extent that such modification is part of a
system-wide modification being implemented by MAPL.

         (ii) Notwithstanding the provisions of Article 4(c)(i), RGPC may adjust
the volume incentive rate contained in the Tariff beginning on the second
anniversary of Start-Up of Operations in accordance with an annual inflation
adjustment to reflect increases in the Producer Price Index for Finished Goods
(as found in Table 1 of the Product Prices and Price Indexes published by the
U.S. Department of Labor, Bureau of Labor Statistics) for each successive twelve
(12) Month period commencing on the first anniversary date of Start-Up of
Operations. The amount of any such inflation adjustment for any such twelve (12)
Month period shall be equal to (x) the difference between the then applicable
volume incentive rate and U.S.$0.42 multiplied by (y) the percentage increase in
said Producer Price Index for such twelve (12) Month period. Such inflation
adjustment shall be added to the

                                       25
<PAGE>

then applicable volume incentive rate to determine the adjusted volume incentive
rate. PMI agrees that it shall not, at any time during the Delivery Period, file
or join in any protest before the FERC regarding the application of the
inflation adjustment mechanism provided for in this Article 4(c)(ii).

         (iii) Except as expressly set forth in Article 4(c)(ii), nothing in
this Agreement shall constitute any waiver by PMI of its right to file or join
in any protest before the FERC regarding any modification to the Tariff in
respect of which PMI shall not have consented and PMI hereby expressly reserves
such right.

         (d) UNAFFILIATED SHIPPER. At the request of RGPC, PMI shall sign and
deliver to RGPC a letter, substantially in form of Exhibit K, stating its
intention to utilize the services of the U.S. Pipeline.

                                    ARTICLE 5

                             TRANSPORTATION CHARGES

         (a) VOLUME INCENTIVE RATE. MAPL and RGPC, jointly, shall establish and
publish the Tariff for transportation services on the U.S. Pipeline in
accordance with accepted FERC methodology. Notwithstanding the foregoing, the
transportation charges during the Delivery Period applicable to PMI or any other
shipper making an annual volume delivery commitment of 12,500 BPD on a ratable
basis through the U.S. Pipeline shall be initially U.S.$1.68 per barrel and,
after the filing of the initial Tariff, at the rate contained in the Tariff
approved by FERC (subject at all times to the limitations set forth in Article
4(c)) and a credit of U.S.$0.084 per barrel shall be provided for each barrel
shipped by a shipper

                                       26
<PAGE>

in any calendar quarter in which the average daily volume of the U.S. Pipeline
for total, aggregate volumes of all shippers to destinations at or beyond
Milepost 192 on the NSI line equals or exceeds 20,000 BPD. All such credits
shall be automatically applied against subsequent transportation charges
incurred by such shippers and such credits shall remain in effect for a period
of twelve (12) Months following the end of the calendar quarter in which the
same shall have been earned.

         (b) REDUCTION OF THE VOLUME INCENTIVE RATE. During the Delivery Period,
the transportation charges (including the volume incentive rate) included in the
Tariff shall be reduced by U.S.$0.42 per barrel for LPG delivered, either
through the U.S. Pipeline to the U.S./Mexico interconnection point or otherwise
in accordance with Article 9(b), at such time as the aggregate volume of such
products (x) delivered through the U.S. Pipeline to the U.S./Mexico border
interconnection point or otherwise in accordance with Article 9(b) or (y) for
which a deficiency payment has been made in accordance with the terms of the
Tariff, equals or exceeds 36.125 million barrels. Notwithstanding the foregoing,
such aggregate volume shall be adjusted in accordance with Article 5(d) to
reflect:
                (i)       any increase or decrease in the capital cost for
                          construction as determined by reference to Exhibit J
                          of the Mexican Pipeline and the Improvements to the
                          Mendez Terminal if the final cost is not U.S. $7.5
                          million; it being understood and agreed that, for
                          purposes of making any such adjustment, "final cost"
                          shall mean the total price for the construction of the
                          Mexican Pipeline and the Improvements to the Mendez
                          Terminal as set forth in the awards to the contractors

                                       27
<PAGE>
                          constructing the same;

                 (ii)     any changes required by the Internal Revenue Service
                          in the 10-year straight-line cost recovery methodology
                          used by RGPC for the agreed investment in the Mexican
                          Pipeline and the Improvements to the Mendez Terminal
                          and reflected in Exhibit J;

                 (iii)    the amount, if any, of value added tax that may be
                          imposed on RGPC by Mexico as a result of the
                          relinquishment of control by RGPC of the Improvements
                          to the Mendez Terminal and the Mexican Pipeline upon
                          completion of the construction of the same for PMI;
                          provided, however, that PMI or its PMI Designated
                          Affiliate shall, at its option, have the right to pay
                          the full amount of any such tax upon its assessment by
                          Mexico in which event no adjustment to Exhibit J as
                          contemplated by this clause (iii) shall be made; and

                 (iv)     any increase in insurance costs incurred by RGPC as a
                          result of any changes required by Pemex in the
                          insurance coverage required to be maintained in
                          accordance with Article 2(c)(v).

Each of the Joint Venture Participants will provide PMI annually with a
certificate, executed by an authorized officer, specifying the method by which
the cost of the Mexican Pipeline and the Improvements to the Mendez Terminal are
recovered in its U.S. federal income tax return.

         (c) DEFICIENCY PAYMENTS. Subject to the provisions of Article 10 and
the last sentence of this Article 5(c), if PMI or its designated shipper shall
fail to ship the Yearly

                                       28
<PAGE>

Committed Volume in any Delivery Year, PMI shall pay, or cause to be paid, to
RGPC, in accordance with the terms and conditions of the Tariff, a deficiency
payment equal to the difference between (x) the Yearly Committed Volume for such
Delivery Year and (y) the actual volume shipped during such Delivery Year
multiplied by the applicable volume incentive rate. Any deficiency payments made
in respect of any Delivery Year shall be deemed to be, and shall be applied on a
current basis as, prepaid transportation charges at the applicable tariff rates
for any volumes shipped in excess of PMI's Yearly Committed Volume for the
subsequent Delivery Year. Notwithstanding the foregoing, no deficiency payment
shall be payable with respect to any unshipped volumes if and to the extent that
the actual volume shipped during any Delivery Year is less than the Yearly
Committed Volume as a result of any allocation of capacity made in accordance
with the Tariff.

         (d) ADJUSTMENTS. Any adjustment required by this Agreement (including
Article 9) to the aggregate volume referred to in Article 5(b) shall be made, in
the case of a dollar adjustment, by adding to or subtracting from, as the case
may be, U.S.$7.5 million, the amount of such dollar adjustment, with the
adjusted aggregate volume being that volume corresponding to the result of the
foregoing calculation as set forth in Exhibit J; and, in the case of a barrel
adjustment, by adding to or subtracting from, as the case may be, 36.125
million, the amount of such barrel adjustment, with the adjusted aggregate
volume being the result of the foregoing calculation.

                                       29
<PAGE>

                                    ARTICLE 6

                                MEXICAN PIPELINE

         To the extent that Mexican law permits the ownership by private parties
of an interest in the Mexican Pipeline or the Mendez Terminal and PMI or its PMI
Designated Affiliate, during the period commencing with the date of this
Agreement and ending on the later of (a) eleventh anniversary date thereof or
(b) the termination of the Delivery Period, receives from an unaffiliated third
party (whether through public solicitation of bids or otherwise) an offer to
purchase a controlling interest in either or both of the Mexican Pipeline and
the Mendez Terminal which such offer PMI or such PMI Designated Affiliate
desires to accept, PMI or such PMI Designated Affiliate, promptly after the
close of the period for receipt of offers in the case of offers received
through public solicitation of bids, or, in the case of an unsolicited offer,
promptly upon receipt of such unsolicited offer, shall notify RGPC in writing of
the terms of the offer PMI or such PMI Designated Affiliate desires to accept.
If and to the extent that RGPC (or, in the event that Mexican law limits foreign
ownership of an offeror, an Affiliate of RGPC or any Joint Venture Participant
which meets such foreign ownership requirements) meets the minimum criteria, if
any, that PMI or a PMI Designated Affiliate shall have established for offerors,
RGPC shall have the right to match the terms and conditions of such offer. Such
right shall be exercisable by written notice to PMI or its PMI Designated
Affiliate given (a), in the case of a public solicitation of bids, not later
than five (5) Days prior to the date by which PMI or its PMI Designated
Affiliate is required to award the winning bid in accordance with the terms of
the solicitation, or (b), in the case of an unsolicited offer, fifteen (15) Days
after receipt

                                       30
<PAGE>

from PMI or its PMI Designated Affiliate of notice of such offer or, in the
event that such unsolicited offer shall remain open for a period of less than
fifteen (15) Days, at such time within the period for which such offer remains
open as shall permit PMI or its PMI Designated Affiliate a reasonable
opportunity to review the offer by RGPC prior to the expiration of the period
for which such unsolicited offer remains open. If RGPC shall elect to exercise
the right described in the preceding sentence, PMI or its Designated Affiliate
shall sell, and RGPC shall purchase, the interest in the assets which are the
subject of the offer in accordance with terms and conditions thereof.
Notwithstanding anything that may be contained herein to the contrary, the right
herein granted to RGPC shall be at all times subject to all requirements of all
applicable laws of Mexico, including, without limitation, the Ley de
Adquisiciones y Obras Publicas, the Ley de Bienes Nacionales and Article 134
of the Political Constitution of Mexico, and any applicable approvals required
by any Governmental Body of Mexico. Nothing herein shall, or shall be deemed or
construed to, (a) require PMI or its PMI Designated Affiliate to solicit or
consider any offer from any unaffiliated third party to purchase either or both
of the Mendez Terminal and the Mexican Pipeline; (b) limit the ability of PMI or
its PMI Designated Affiliate to establish such minimum criteria for offerors or
offers to purchase, or both, as PMI or its PMI Designated Affiliate, in the
exercise of its sole discretion, may deem advisable or as may be required by
law; or (c) impair in any way the right of PMI or its PMI Designated Affiliate
to reject any and all offers received therefor for any reason whatsoever. The
provisions of this Article 6 shall not apply to (i) any transfer by PMI or its
PMI Designated Affiliate of any interest in either or both of the Mendez
Terminal and the Mexican Pipeline to any one or

                                       31
<PAGE>

more of its Affiliates; (ii) any transfer which occurs in connection with any
transaction entered into by PMI or its PMI Designated Affiliate or any
Affiliate which is in the nature of a financing; nor (iii) any offer to purchase
an interest in assets of PMI or its PMI Designated Affiliate of which such
assets either or both of the Mexican Pipeline and the Mendez Terminal do not
constitute substantially all of the assets which are the subject of such offer.

                                    ARTICLE 7

                              MEASUREMENT; REPORTS

         For purposes of determining the transportation charges applicable to
any delivery, measurement of the volume of all LPG transported through the U.S.
Pipeline to the Mendez Terminal shall take place at the custody transfer meter
located on the U.S. side at the U.S./Mexico border in accordance with the
methodology set forth in the Pipeline Interconnect Agreement and, absent
manifest error, such measurement shall be conclusive. Within five (5) working
Days after the end of each Month during the Delivery Period, RGPC shall provide
a report to PMI setting forth (a) the volumes of all LPG transported during such
Month and (b) the aggregate volume of all LPG transported or for which a
deficiency payment has been made through the end of such Month. Notwithstanding
the foregoing, RGPC shall not be obligated to provide any information regarding
any shipper from which a consent to the release of such information has not been
received. RGPC shall immediately notify PMI when the aggregate volume reaches
36.125 million barrels or such lesser or greater volume determined in accordance
with Article 5(b) of this Agreement.

                                       32
<PAGE>

                                    ARTICLE 8

                         LIABILITY OF CERTAIN AFFILIATES

         (a) It is understood that Pemex, except to the extent that Pemex is the
PMI Designated Affiliate, shall have no obligation or liability to RGPC, MAPL
or any of the Joint Venture Participants under this Agreement and that nothing
in this Agreement shall create any obligation of Pemex to third parties
resulting from performance by RGPC, its contractors or subcontractors or MAPL of
their respective obligations under this Agreement.

         (b) If at any time during the term of this Agreement, PMI shall
determine, in the exercise of its good faith judgment, that the financial
condition of any Joint Venture Participant is insufficient to satisfy its
obligations under this Agreement, PMI may request from such Joint Venture
Participant, and such Joint Venture Participant shall provide, a duly executed
guarantee of the obligations of such Joint Venture Participant from its Joint
Venture Participant Parent.

                                    ARTICLE 9

                               TIME OF COMPLETION

         (a) If Start-Up of Operations shall occur prior to the date which is
450 Days from the date of this Agreement, then for each thirty (30) consecutive
Day period, or part thereof, during which the U.S. Pipeline and the Mexican
Pipeline are operational and occurring prior to the 450th Day after the date of
this Agreement, the aggregate volume that must be shipped prior to any reduction
of the volume incentive rate contemplated by Article 5(b), shall be adjusted in
accordance with Article 5(d) by an amount equal to the greater of (x) 10,000 BPD
or (y) the actual volume, which, in each case, is delivered between the

                                       33
<PAGE>
Start-Up of Operations and the 450th Day after the date of this Agreement.

         (b) Notwithstanding the provisions of Article 10, if Start-Up of
Operations of the U.S. Pipeline and the Mexican Pipeline shall not have occurred
by the date which is 630 Days after the date of this Agreement, RGPC, for so
long as Start-Up of Operations shall not have occurred, shall deliver or cause
to be delivered, to the Mendez Terminal by such alternate means of
transportation as it deems appropriate all volumes (up to a maximum of 12,500
BPD) of LPG that would otherwise have been delivered through the U.S. Pipeline
to the U.S./Mexico border at the same transportation costs for such LPG that PMI
would have incurred had Start-Up of Operations occurred. If PMI shall request
deliveries of LPG in excess of 12,500 BPD, the parties shall negotiate in good
faith to arrive at a mutually agreeable transportation cost therefor. All other
terms and conditions of this Agreement shall apply to the volumes delivered
pursuant to this paragraph, including, without limitation, Article 5(c).

         (c) The provisions of Article 9(b) shall be the sole and exclusive
remedy of PMI in the event that Start-Up of Operations shall not have occurred
by the date set forth therein.

         (d) It is agreed and understood that the 450 Day and 630 Day periods
referred to above shall be extended by an amount of time equal to the duration
of any delays in Start-Up of Operations caused or contributed to by PMI or its
PMI Designated Affiliate in the performance of the obligations of PMI under this
Agreement.

                                       34
<PAGE>

                                   ARTICLE 10

                                  FORCE MAJEURE

         (a) EVENTS OF FORCE MAJEURE. Except as expressly set forth otherwise in
this Agreement, neither party hereto shall have any liability for any delay or
nonperformance hereunder when caused in whole or in part by force majeure. Force
majeure shall include, without limitation, acts of God or the public enemy;
floods or fire; hostilities; war (declared or undeclared); blockade; quarantine
restrictions or epidemics; compliance with any order, decree, law or regulation
issued by a Governmental Body in Mexico or the United States which prohibits the
transactions contemplated hereby; delays in the permitting, acquisition of
rights of way, rights of passage or other authorizations necessary for
construction and operation of the U.S. Pipeline, the Mexican Pipeline or the
Improvements to the Mendez Terminal; any other cause beyond the reasonable
control of the affected party whether or not reasonably foreseeable; or labor
trouble, strike, lockout or injunction (whether or not such labor event is
within the reasonable control of such party). Notwithstanding the foregoing, no
party shall be relieved of its obligation to diligently pursue the issuance of
all permits or authorizations or the acquisition of all rights of way and rights
of passage required for the performance by such party of its obligations of this
Agreement. Any party claiming force majeure shall promptly notify the other of
the occurrence of the event of force majeure relied upon, and shall estimate the
length of time that the force majeure condition is expected to continue. Such
party shall also promptly notify the other of the cessation of force majeure
conditions.

         (b) EFFECTS. If, as a result of the effects of one or more events of
force majeure,

                                       35
<PAGE>

LPG is not being transported through the U.S. Pipeline and the Mexican Pipeline,
then, for all purposes of this Agreement including, without limitation, the
calculation of deficiency payments under Article 5(c) in any Delivery Year,
PMI's Yearly Committed Volume shall be adjusted on a pro rata basis for such
Delivery Year without altering the applicable volume incentive rate. It is
further agreed and understood that if the Cumulative Volume shall not have been
reached at the end of the Delivery Period as a result of the effects of one or
more events of force majeure, then the Delivery Period shall be extended until
such time as the Cumulative Volume shall be shipped.

                                   ARTICLE 11

                         PIPELINE INTERCONNECT AGREEMENT

         Promptly after the execution and delivery of this Agreement but in no
event less than one hundred twenty (120) Days prior to the start-up of
operations of the U.S. Pipeline and the Mexican Pipeline, RGPC, MAPL and a PMI
Designated Affiliate shall enter into the Pipeline Interconnect Agreement
pursuant to which the parties shall establish those operating procedures
intended to ensure efficient operation of the U.S. and Mexican Pipelines.

                                   ARTICLE 12

                           ARBITRATION; GOVERNING LAW

         (a) SETTLEMENT BY ARBITRATION. All disputes arising under or relating
to this Agreement shall be settled finally by arbitration in New York, New York,
conducted in

                                       36
<PAGE>
accordance with the Rules of Conciliation and Arbitration of the International
Chamber of Commerce ("ICC") in effect at such time. The number of arbitrators
shall be three (3). Each of (i) RGPC (including, for purposes hereof, all Joint
Venture Participants who may be parties to any arbitration) and MAPL, and (ii)
PMI (including, for purposes hereof, all PMI Designated Affiliates  who may
be parties to any arbitration) shall have the right to name a single arbitrator
and the ICC shall name a third, who shall act as chairman. If either (i) RGPC,
the Joint Venture Participants, and MAPL or (ii) PMI and the PMI Designated
Affiliates cannot agree on a single arbitrator, such arbitrator shall be named
by the ICC. Any arbitration shall be conducted in the English language.

         (b) FINALITY OF AWARD. The arbitrators award shall be final,
non-appealable and binding on the parties. Judgment may be entered upon the
award in any court of competent jurisdiction.

         (c) GOVERNING LAW. This Agreement shall be governed by and interpreted
in accordance with the laws of New York, without giving effect to its principles
of conflicts of laws.

                                   ARTICLE 13

                                ENTIRE AGREEMENT

         This Agreement and the Exhibits hereto constitute the entire agreement
between the parties pertaining to the subject matter hereof and supersede all
prior agreements between the parties. No prior contract or course of dealing
between the parties, and no statement of any agent, employee or representative
of any party or any of their respective Affiliates made prior to the execution
of this Agreement shall be admissible in construing the terms

                                       37
<PAGE>
of this agreement.

                                   ARTICLE 14

            NO WAIVER; CUMULATIVE REMEDIES; LIMITATION OF LIABILITY

         (a) NO WAIVER; CUMULATIVE REMEDIES. No failure or delay on the part of
any party exercising any right, power or remedy hereunder and no course of
dealing between RGPC and PMI or any of their respective Affiliates shall operate
as a waiver of any such right, power or remedy; nor shall any single or partial
exercise of any such right, power or remedy preclude any other or further
exercise thereof or the exercise of any other right, power or remedy hereunder.
Without prejudice to Article 12 and subject to Article 9 hereof, all rights,
powers or remedies provided hereunder are (whether or not expressly stated
elsewhere in this Agreement with respect to any particular remedy) cumulative
and not exclusive of any other rights, powers or remedies provided by law or
otherwise. Except as required by this Agreement, no notice or demand by one
party in any case shall entitle any other party to any other or future notice or
demand in similar or other circumstances or constitute a waiver of the right of
the first party to take other or further action in any such circumstances
without notice or demand.

         (b) LIMITATION OF LIABILITY. No party shall be liable for prospective
profits or special, punitive, indirect or consequential losses or damages of any
kind arising out of or in any way connected with the performance of or failure
to perform this Agreement, including, but not limited to, losses or damages
resulting from a shutdown of plants or inability to perform sales or any other
contracts arising out of or in connection with the

                                       38
<PAGE>

performance or nonperformance of this Agreement. Notwithstanding anything in
this Article 14(b) that may be to the contrary, in the event of a breach by PMI
of its obligations under Article 3(b), nothing herein shall preclude RGPC from
seeking, as part of its actual damages, the transportation charges that would
have been applicable to any additional volumes that would have been shipped but
for the breach of Article 3(b) by PMI.

                                   ARTICLE 15

                             AMENDMENTS AND WAIVERS

         Any amendment of this Agreement must be made upon the express written
agreement of the parties, and any waiver of any provision of this Agreement by
any party must be upon the express written agreement of the party against which
enforcement of such waiver is sought.

                                   ARTICLE 16

                                   ASSIGNMENT

         Except in the case of a transfer or assignment by PMI to one or more
PMI Designated Affiliates of any of PMIs rights or obligations under this
Agreement, no party may transfer or assign this Agreement or any of its rights
or obligations hereunder without the prior written consent of the parties. No
assignment by PMI as contemplated herein shall relieve PMI of any of its
liability under this Agreement except as may be mutually agreed. Any purported
assignment not in accordance with this Article shall be void and of no force and
effect.

                                       39
<PAGE>

                                   ARTICLE 17

                           SEVERABILITY OF PROVISIONS

         The invalidity, illegality or unenforceability of any one or more of
the provisions of this Agreement shall in no way affect or impair the validity
and enforceability of the remaining provisions hereof.

                                   ARTICLE 18

                                    NOTICES

         Except as otherwise provided, all notices and other communications
hereunder to a party shall be in writing and unless otherwise specified herein
shall be effective when received by registered mail, telex, facsimile or courier
to such party at its address listed below:

         If to PMI:  P.M.I. Trading Ltd.
                     Avenida Marina Nacional No. 329
                     Torre Ejecutiva Piso 22
                     Mexico D.F., CP. 11311

                     Telex No.: 1773509
                     Facsimile No.: (525)227-0140/(713)567-0140
                     Attn: Director of Products

         If to RGPC, any of the Joint Venture Participants or MAPL:

                     c/o Mid-America Pipeline Company
                     1800 South Baltimore Avenue
                     Tulsa, Oklahoma 74119

                     Facsimile No.: 918-581-1470
                     Attn: President

or at such address as may be notified by one party to the other in the manner
above

                                       40
<PAGE>

provided. In the case of communications from RGPC relating to construction,
copies shall be sent to Pemex by registered mail, telex, facsimile or courier at
the address listed below:

                     Pemex Gas y Petroquimica Basica
                     Avenida Marina Nacional 329
                     Edificio B1, 7 Piso
                     11311 Mexico, D.F. Mexico

                     Facsimile No.: (525) 722-2500 ext. 22359
                     Attn: Manager of Projects and Construction

                                   ARTICLE 19

                                    HEADINGS

         All Article headings used in this Agreement are for convenience only
and shall not affect the construction or interpretation of any of the terms
hereof.

                                   ARTICLE 20

                                   REFERENCES

         Unless otherwise specified, all Article and Exhibit references
contained in this

                                       41
<PAGE>
Agreement are to the Articles hereof and the Exhibits hereto.

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers or representatives on the date first
above written.

<Table>

<S>                                      <C>
P.M.I. TRADING, LTD.                     RIO GRANDE PIPELINE COMPANY
                                         by  JUAREZ PIPELINE COMPANY,
                                              GENERAL PARTNER

/s/ EDUARDO MARTINEZ DEL RIO             /s/ R. T. CRONK
---------------------------------        ----------------------------------
By: Eduardo Martinez del Rio             By: R. T. Cronk
Title: General Director                  Title: President

AMOCO RIO GRANDE PIPELINE COMPANY        JUAREZ PIPELINE COMPANY

/s/ S. K. SETLIFF                        /s/ R. T. CRONK
---------------------------------        ----------------------------------
By: S. K. Setliff                        By: R. T. Cronk
Title: President                         Title: President

NAVAJO SOUTHERN, INC.                    MID AMERICA PIPELINE COMPANY

/s/ WILLIAM J. GRAY                      /s/ R. T. CRONK
---------------------------------        ----------------------------------
By: William J. Gray                      By: R. T. Cronk
Title: President                         Title: President
</Table>

                                       42

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