Document:

CONVEYANCE AGREEMENT

     Recording  Requested  by  and When Recorded Return to: Fulbright & Jaworski
L.L.P.,  300  Convent  St.,  Suite  2200, San Antonio, Texas, Attn: Christian G.
Herff.

                              CONVEYANCE AGREEMENT

     This  Conveyance  Agreement  (this "Conveyance"), effective as of 4:58 P.M.
Eastern  Time  on September 30, 2004 (the "Effective Date"), is from PENN OCTANE
CORPORATION,  a  Delaware corporation (herein called "Grantor"), and in favor of
RIO VISTA OPERATING PARTNERSHIP L.P., whose mailing address is 820 Gessner Road,
Suite  1285,  Houston,  TX  77024  (herein  called  "Grantee").

                                    ARTICLE I

                                 GRANTING CLAUSE

     1.1  GRANTING  CLAUSES.  Grantor  hereby  contributes,  conveys,  assigns,
transfers, delivers, and sets over unto Grantee, its successors and assigns, all
right,  title, interests and estate of Grantor in and to the following described
property,  to-wit:

     ALL  OF  THE  ASSETS  SET  FORTH  ON  SCHEDULE  A  ATTACHED  HERETO

     The  property  described  in  this  Section 1.1 shall be referred to herein
collectively  as  the  "Subject  Property".

     TO  HAVE  AND  TO  HOLD  the  Subject  Property,  subject  to the terms and
conditions  hereof,  unto  Grantee,  its  successors  and  assigns,  forever.

                                   ARTICLE II

                      ENCUMBRANCES AND WARRANTY DISCLAIMERS

     2.1  PERMITTED ENCUMBRANCES. This Conveyance is made and accepted expressly
subject  to  (a)  all  liens,  charges,  encumbrances,  contracts,  agreements,
instruments,  obligations, defects, restrictions, security interests, options or
preferential  rights  to  purchase,  adverse  claims,  reservations, exceptions,
easements,  rights-of-way,  conditions,  leases,  other  matters  affecting  the
Subject  Property  or  to  which  it  is  subject; and (b) to all matters that a
current  on  the  ground  survey  or  visual  inspection  would  reflect.

     2.2  CONTRIBUTION  AGREEMENT.  This Conveyance is expressly made subject to
the terms and conditions of that certain Contribution, Conveyance and Assumption
Agreement  dated  as of September 16, 2004, among Grantor, Grantee and the other
parties  thereto  (the  "Contribution  Agreement").  All  capitalized terms used
herein  shall  have  the  meanings  given  to  such  terms  in  the Contribution
Agreement, unless otherwise defined herein. Nothing contained in this Conveyance
shall  in  any way affect the provisions set forth in the Contribution Agreement
nor  shall  this  Conveyance expand or contract any rights or remedies under the
Contribution  Agreement. This Conveyance is intended only to effect the transfer
of the Subject Property to Grantee as provided for in the Contribution Agreement
and  shall  be  governed entirely in accordance with the terms and conditions of
the Contribution Agreement. In the event of a conflict between the terms of this
Conveyance  and  the  terms  of  the  Contribution  Agreement,  the terms of the
Contribution  Agreement  shall  prevail.

     2.3  DISCLAIMER  OF  WARRANTIES;  SUBROGATION. Except as expressly provided
herein  or  in  the  Contribution  Agreement,  this  Conveyance  is made, and is
accepted  by  Grantee, without warranty of title, express, implied or statutory,
and without recourse, but with full substitution and subrogation of Grantee, and
all  persons  claiming by, through, and under Grantee, to the extent assignable,
in  and  to all covenants and warranties by the predecessors in title of Grantor
and  with  full  subrogation of all rights accruing under applicable statutes of
limitation  or  prescription  and  all  rights of action of warranty against all
former owners of the Subject Property. Except as expressly provided herein or in
the  Contribution  Agreement,  any  covenants  implied  by  statute  or  by  the

                                      D-1
<PAGE>
use  of  the  words  "convey",  "sell", "assign", "transfer", "deliver", or "set
over"  or  any  of  them  or any other words used in this Conveyance, are hereby
expressly  disclaimed,  waived  and  negated.

                                   ARTICLE III

                                  MISCELLANEOUS

     3.1  FURTHER ASSURANCES. Grantor and Grantee agree to take all such further
actions  and to execute, acknowledge and deliver all such further documents that
are necessary or useful in carrying out the purposes of this Conveyance. So long
as authorized by applicable law so to do, Grantor agrees to execute, acknowledge
and  deliver  to  Grantee  all  such  other  additional  instruments,  notices,
affidavits,  deeds,  conveyances,  assignments and other documents and to do all
such  other  and  further  acts and things as may be necessary or useful to more
fully and effectively grant, assign, convey, transfer and deliver to Grantee the
Subject  Property  conveyed  hereby  or  intended  so  to  be  conveyed.

     3.2  SUCCESSORS  AND  ASSIGNS;  NO THIRD PARTY BENEFICIARY. This Conveyance
shall  be  binding  upon, and shall inure to the benefit of, Grantor and Grantee
and  their  successors  and  assigns.  The provisions of this Conveyance are not
intended  to  and  do  not create rights in any other person or entity or confer
upon  any  other person or entity any benefits, rights or remedies and no person
or  entity  is  or  is  intended  to  be a third party beneficiary of any of the
provisions  of  this  Conveyance.

     3.3  GOVERNING  LAW.  This  Conveyance  and the legal relations between the
parties  shall be governed by, and construed in accordance with, the laws of the
State  of  Texas, excluding any conflict of law rule which would refer any issue
to the laws of another jurisdiction, except when it is mandatory that the law of
the  jurisdiction  wherein  the  Subject  Property  is  located  shall  apply.

     3.4  HEADINGS;  REFERENCES;  DEFINED  TERMS.  All  Section headings in this
Conveyance are for convenience only and shall not be deemed to control or affect
the meaning or construction of any of the provisions hereof. The words "hereof",
"herein"  and  "hereunder"  and  words  of  similar  import,  when  used in this
Conveyance,  shall  refer  to  this  Conveyance  as  a whole, including, without
limitation,  all  Schedules  and  Exhibits  attached  hereto,  and  not  to  any
particular  provision  of  this  Conveyance.

     3.5  COUNTERPARTS.  This  Conveyance  may  be  executed  in  any  number of
counterparts,  all  of  which together shall constitute one agreement binding on
the  parties  hereto.

     3.6  SEVERABILITY.  If any of the provisions of this Conveyance are held by
any  court  of competent jurisdiction to contravene, or to be invalid under, the
laws  of  any political body having jurisdiction over the subject matter hereof,
such  contravention  or  invalidity  shall  not invalidate the entire agreement.
Instead,  this  Conveyance  shall  be  construed  as  if  it did not contain the
particular  provision  or  provisions  held  to  be  invalid  and  an  equitable
adjustment  shall  be made and necessary provision added so as to give effect to
the  intention  of  the  parties  as expressed in this Conveyance at the time of
execution  of  this  Conveyance.

<PAGE>
     IN  WITNESS  WHEREOF, this Conveyance has been duly executed by the parties
hereto  on  the  dates  of the acknowledgments set forth below, to be effective,
however,  as  of  the  Effective  Date.

                                        GRANTOR:

                                        PENN OCTANE CORPORATION

                                        By:/s/ Richard Shore, Jr.
                                           -----------------------------------
                                            Richard Shore, Jr.,
                                            President

                                        GRANTEE:

                                        RIO VISTA OPERATING PARTNERSHIP L.P.

                                        By: Rio Vista Operating GP LLC,
                                        its General Partner

                                            By: Rio Vista Energy Partners L.P.,
                                            its sole member

                                               By: Rio Vista GP LLC,
                                               its General Partner

                                                   By:/s/ Richard Shore, Jr.
                                                      -------------------------
                                                         Richard Shore, Jr.,
                                                         President

<PAGE>
THE STATE OF CALIFORNIA )
                        )
COUNTY OF SAN FRANCISCO )

     This  instrument  was  acknowledged before me on the 15th day of September,
2004,  by Richard Shore, Jr., President of Penn Octane Corporation, on behalf of
and  in  his  capacity  as  President  of  Penn  Octane  Corporation.

                                           /s/  Barbara  Booth
                                           -------------------------------------
                                           NOTARY  PUBLIC

My Commission Expires: Nov. 12, 2006
                     ---------------

THE STATE OF CALIFORNIA )
                        )
COUNTY OF SAN FRANCISCO )

     This  instrument  was  acknowledged before me on the 15th day of September,
2004,  by Richard Shore, Jr., President of Rio Vista GP LLC, on behalf of and in
his  capacity  as  President  of  Rio  Vista  GP  LLC.

                                           /s/ Barbara Booth
                                           -------------------------------------
                                           NOTARY  PUBLIC

My Commission Expires: Nov. 12, 2006
                     ---------------

<PAGE>
                                   SCHEDULE A

<PAGE>DISTRIBUTION AGREEMENT

                                 BY AND BETWEEN

                             PENN OCTANE CORPORATION

                                       AND

                 RIO VISTA ENERGY PARTNERS L.P. AND SUBSIDIARIES

                               SEPTEMBER 16, 2004

<PAGE>
                             DISTRIBUTION AGREEMENT

     THIS DISTRIBUTION AGREEMENT (this "Agreement") is dated September 16, 2004,
by and among PENN OCTANE CORPORATION., a Delaware corporation ("POC"), RIO VISTA
ENERGY  PARTNERS  L.P.,  a  Delaware  limited  partnership  ("RVP"), and the Tax
Subsidiaries  (as  defined  in  Article  1)  of  RVP.

                                   WITNESSETH:

     WHEREAS,  POC  is the sole limited partner of RVP and owner of common units
representing a 98% limited partner interest in RVP (the "RVP Common Units"); and

     WHEREAS,  POC  desires  to  distribute  to  its stockholders all of the RVP
Common  Units;

     NOW,  THEREFORE,  in  consideration  of  the premises and the mutual terms,
covenants  and  conditions  herein  contained, and intending to be legally bound
hereby,  the  parties  hereto  hereby  agree  as  follows:

                                    ARTICLE 1

                               CERTAIN DEFINITIONS

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

     1.1  "Affiliate"  shall  mean, with respect to POC or RVP, any Person, that
directly or indirectly, is in control of, is controlled by, controls or is under
common  control  of  POC  or  RVP,  as  the  case  may  be. For purposes of this
definition,  control  shall include the ownership of 50% or more of the legal or
beneficial  interest in any Person or the power 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. A Person who is an Affiliate shall
only  be considered an Affiliate for so long as that Person meets the definition
of  an  Affiliate.  An  officer,  director,  general partner, managing member or
trustee of a Person or Affiliate of such Person shall not be considered to be an
Affiliate  unless  such Person is under the direct or indirect control or common
control  of POC or RVP, as the case may be. For purposes of clarity, POC and RVP
shall  not  be  considered  to be an Affiliate of the other, nor shall any other
company in which a director or officer of POC or RVP is also a director, officer
or  stockholder  be  considered an Affiliate of POC or RVP unless POC or RVP, as
the  case  may  be,  itself  controls  such  company.

     1.2     "Agreement"  shall  have  the  meaning  specified  in the preamble.

     1.3     "Business  Day" shall mean any day other than Saturday, Sunday or a
day  on  which  commercial  banks  located  in  Houston,  Texas  are required or
authorized  by  law  to  close.

     1.4     "Code"  shall  mean  the Internal Revenue Code of 1986, as amended.

     1.5     "Common  Unit" shall mean the common units of RVP as defined in the
RVP  First  Amended  and  Restated  Agreement  of  Limited  Partnership.

                                        1
<PAGE>
     1.6  "Distribution"  shall mean the distribution by POC to its stockholders
of  the  RVP  Common  Units.

     1.7  "Distribution  Agent"  shall  mean  Computershare  Investor  Services.

     1.8  "Distribution  Date"  shall  mean  the  time  and date as of which the
Distribution  is  effective.

     1.9  "Liability"  shall  mean  any  and  all  claims, demands, liabilities,
responsibilities,  disputes,  causes  of  action,  losses, damages, assessments,
costs  and  expenses  (including  interest,  awards,  judgments,  penalties,
settlements,  fines,  costs  of  remediation,  diminutions  in  value, costs and
expenses  incurred  in connection with investigating and defending any claims or
causes  of  action  (including, without limitation, attorneys' fees and expenses
and  all  fees  and  expenses  of  consultants  and  other  professionals))  and
obligations  of  every  nature  whatsoever, liquidated or unliquidated, known or
unknown,  matured  or  unmatured,  or  fixed  or  contingent.

     1.10  "Nasdaq"  shall  mean  The  Nasdaq  Stock  Market,  Inc.

     1.11  "POC"  shall  mean  Penn  Octane Corporation, a Delaware corporation.

     1.12  "POC  Common  Stock"  shall  mean POC's common stock, $.01 par value.

     1.13  "Person" shall mean an individual, partnership, corporation, business
trust,  limited  liability  company,  limited liability partnership, joint stock
company,  trust,  unincorporated  association,  joint  venture,  governmental
authority  or  other  entity  of  whatever  nature.

     1.14 "RVP" for purposes of the assumption and indemnification provisions of
this  Agreement,  shall  include  Rio Vista Energy Partners L.P. and any and all
predecessors  or  successors  thereto,  whether  by  merger,  purchase  or other
acquisition  of  substantially  all  of the assets or otherwise, and any and all
predecessors  or  successors  to  such  entities.

     1.15  "RVP  Assets"  shall mean, collectively, all the property, assets and
rights,  tangible  and  intangible,  owned  or operated by the RVP Companies on,
before  or  after  the  Distribution  Date.

     1.16  "RVP  Common  Units"  shall  have  the  meaning  specified  in  the
introduction  to  this  Agreement.

     1.17  "RVP  Company"  shall  mean  any  Subsidiary  of  RVP.

     1.18  "RVP  First  Amended  and  Restated Agreement of Limited Partnership"
shall mean that certain limited partnership agreement of RVP dated September 16,
2004.

     1.19  "RVP  Properties"  shall  mean the properties currently or previously
owned  or  operated  by  any  RVP  Company.

     1.20  "Record Date" shall have the meaning specified in Section 2.1 hereof.

<PAGE>
     1.21 "SEC" shall mean the United States Securities and Exchange Commission.

     1.22 "Subsidiary" shall mean, with respect to any Person, (i) a corporation
a  majority  of whose Voting Stock is at the time, directly or indirectly, owned
by  such  Person,  by one or more wholly owned subsidiaries of such Person or by
such  Person  and  one  or more wholly owned subsidiaries of such Person, (ii) a
partnership in which such Person or a wholly owned subsidiary of such Person is,
at  the date of determination, a general or limited partner of such partnership,
but  only  if  such Person or its wholly owned subsidiary is entitled to receive
more  than  fifty percent of the assets of such partnership upon its dissolution
or  (iii)  any  other  Person (other than a corporation or partnership) in which
such  Person, a wholly owned subsidiary of such Person or such Person and one or
more  wholly  owned  subsidiaries of such Person, directly or indirectly, at the
date of determination thereof, has (x) at least a majority ownership interest or
(y)  the power to elect or direct the election of a majority of the directors or
other  governing  body  of  such  Person.

     1.23 "Tax Subsidiary" shall mean, with respect to POC or RVP as the context
may require, (i) any corporation or association taxable as a corporation that is
connected in an unbroken chain of stock ownership satisfying the requirements of
Section  1504(a)  of  the  Code  beginning  with  POC  or RVP as the case may be
(provided  that,  for  this  purpose,  after the Distribution Date, RVP shall be
regarded  as a corporation that is the common parent of the RVP Group); (ii) any
entity  not  a corporation that is a "disregarded" entity for federal income tax
purposes  pursuant to Treasury Regulations Sections 301.7701-3 and that is owned
by  POC,  RVP  or  any Tax Subsidiary of either (determined after application of
clause  (i)  above)  and (iii) any "disregarded" entity owned by POC, RVP or any
Tax  Subsidiary  of either (determined after application of clauses (i) and (ii)
above).

     1.24  "Transfer  Agent"  shall  mean  Computershare  Investor  Services.

     1.25  "Voting  Stock" shall mean, with respect to any Person, securities of
any  class  or  classes  of  capital  stock in such Person entitling the holders
thereof  (whether  at  all times or only so long as no senior class of stock has
voting  power  by  reason  of  any  contingency)  to vote in the election of the
members  of  the  board  of  directors  or  other governing body of such Person.

                                    ARTICLE 2

                            MECHANICS OF DISTRIBUTION

     2.1  Mechanics  of  RVP Distribution. The Distribution shall be effected by
          -------------------------------
the  distribution to each holder of record of POC Common Stock, as of the record
date  designated for the Distribution by or pursuant to the authorization of the
Board  of  Directors  of  POC  (the "Record Date"), of one Common Unit for every
eight  shares  of  POC Common Stock held by such holder. No fraction of a Common
Unit shall be issued, but in lieu thereof POC shall cause the Distribution Agent
to aggregate all fractional shares that would be issued but for this Section 2.1
and  sell  such  aggregated  fractional  shares  in  the  public  market and the
aggregate net cash proceeds of those sales shall be distributed ratably to those
POC  stockholders  who  would  otherwise have received the fractional interests.

<PAGE>
     2.2  Timing  of  Distribution. The Board of Directors of POC shall formally
          ------------------------
or  waiver of the conditions set forth in Article 3, by delivery of certificates
for  RVP  Common Units to the Transfer Agent for delivery of Common Units to the
holders  entitled thereto. The Distribution shall be deemed to be effective upon
notification  by  POC  to  the  Transfer  Agent  that  the Distribution has been
declared  and  that  the  Transfer  Agent  is  authorized  to  proceed  with the
distribution  of  the  Common  Units.

                                    ARTICLE 3

                        CONDITIONS TO OBLIGATIONS OF POC

     The  obligations  of  POC to consummate the Distribution hereunder shall be
subject  to  the  fulfillment  of  each  of  the  following  conditions:

          (a) The Board of Directors of POC and the Independent Committee of the
Board  of  Directors  of POC shall be satisfied that, after giving effect to the
Distribution  and  the  transactions  contemplated  under  the  Contribution,
Conveyance  and Assumption Agreement dated September 16, 2004 (the "Contribution
Agreement") by and among POC, RVP, the GP (as defined therein), the Operating GP
(as defined therein) and the Operating Partnership (as defined therein), (i) POC
will not be insolvent and will not have unreasonably small capital with which to
engage  in  its  businesses and (ii) the POC surplus (as such term is defined by
Delaware  General  Corporation  Law)  will  be  sufficient  to  permit,  without
violation  of  Delaware  law,  the  Distribution.

          (b)  POC  and RVP (or its Subsidiary) shall have executed the Purchase
Contract  for  the  sale  of  liquified  petroleum  gas  by  POC  to RVP (or its
Subsidiary).

          (c) POC and RVP shall have executed the Omnibus Agreement, which is to
govern the business relationship between POC and RVP following the Distribution.

          (d)  The  transactions  contemplated  under the Contribution Agreement
shall  have  been  effected.

          (e)  The  Common  Units  shall  have  been approved for trading on the
National Market System of the Nasdaq Stock Market or on such other public market
acceptable to the Board of Directors of POC, and the Nasdaq Stock Market or such
other  public  market  shall not have (i) withdrawn its certification filed with
the  SEC  that  the  Common Units have been approved for listing, (ii) suspended
trading  in  either the Common Units or the POC Common Stock or (iii) filed with
the SEC a Form 25 to strike either the Common Units or the POC Common Stock from
listing  and  registration  thereof.

          (f)  RVP's  Registration  Statement  on  Form  10  shall  have  become
effective  pursuant  to  Section  12  of the Securities Exchange Act of 1934, as
amended, and the SEC shall not have commenced any action to prohibit or restrict
the  Distribution  in  any  way.

<PAGE>
          (g)  All  material governmental and third party approvals and consents
necessary  to  consummate the transactions contemplated under this Agreement and
the  Contribution  Agreement  shall  have  been  obtained.

          (h)  No  order,  injunction or decree issued by any court or agency of
competent  jurisdiction  or  other legal restraint or prohibition preventing the
Distribution or any of the other transactions contemplated by this Agreement and
the  other  agreements  relating  to  the  Distribution  may  be  in  effect.

          (i) The Board of Directors of POC and the Independent Committee of the
Board of Directors of POC shall have received a copy of an independent appraisal
of the assets to be transferred pursuant to the Contribution Agreement, and each
of  the  Board of Directors of POC and the Independent Committee of the Board of
Directors  of  POC  have determined in their sole discretion that, based on such
independent  appraisal, the estimated tax liabilities to be incurred by POC as a
result  of  the  Distribution  are  acceptable.

          (j) The Board of Directors of POC and the Independent Committee of the
Board  of  Directors of POC shall not have determined, in their sole discretion,
to  abandon,  defer  or  modify  the  Distribution  or  the  terms  thereof.

                                    ARTICLE 4

                                  MISCELLANEOUS

     4.1  RVP  Covenants.  To  assure  the performance of the obligations of RVP
          -------------
under this Agreement, RVP hereby covenants and agrees that it will not, and will
cause  its  respective  Subsidiaries not to, merge, convert into another entity,
engage  in  a share exchange for a majority of its units, liquidate or transfer,
assign  or  otherwise convey or allocate, directly or indirectly, in one or more
transactions,  whether  or  not related, a majority of its assets (determined in
good  faith  by  a board resolution prior to the transaction on a fair value and
consolidated  basis)  to  any  Person  unless the acquiring Person (i) expressly
assumes  the  obligations  of it hereunder, (ii) executes and delivers to POC an
agreement,  in  form  and substance satisfactory to POC, agreeing to be bound by
each and every provision of this Agreement as if it were RVP and (iii) has a net
worth  on  a  pro forma basis after giving effect to the acquisition or business
combination  equal  to or greater than that of RVP (on a consolidated basis) and
RVP's  compliance  with  the  provisions  Article  3 of this Agreement. Any such
assumption  of  liability by the acquiring Person shall not release RVP from its
obligations  under  this  Agreement.

     4.2  Governing  Law.  All  questions  arising out of this Agreement and the
          -------------
rights  and  obligations  created  herein,  or  its  validity,  existence,
interpretation,  performance  or  breach,  shall be governed by and construed in
accordance  with  the internals laws of the State of Texas, without regard to or
the  application  of  the  rules  of  conflicts  of laws set forth in such laws.

     4.3  Notices.  All  notices  and  other  communications to be given or made
          -------
hereunder  shall be in writing and shall be (a) personally delivered with signed
receipt  obtained  acknowledging  delivery;  (b)  transmitted by postage prepaid
registered  mail,  return  receipt requested (air mail if international); or (c)
transmitted  by  facsimile;  to  a  party  at  the  address  set

<PAGE>
out below (or at such other address as it may have provided notification for the
purposes  hereof  to  the  other  party hereto in accordance with this Section).

<TABLE>
<CAPTION>
<S>                                   <C>
          If to RVP or to any of the  Rio Vista GP LLC
          Tax Subsidiaries of RVP:    820 Gessner Road, Suite 1285
                                      Houston, Texas  77024
                                      Fax number:  (713) _________
                                      Attention:   President

                                      With a copy to:

                                      Fulbright & Jaworski L.L.P.
                                      300 Convent St., Suite 2200
                                      San Antonio, Texas 78205
                                      Fax number:  (210) 270-7205
                                      Attention:  Phillip M. Renfro

          If to POC:                  Penn Octane Corporation
                                      77-530 Enfield Lane, Building D
                                      Palm Desert, CA 92211
                                      Fax number:  (760) 772-8588
                                      Attention:   President

                                      With a copy to:

                                      Fulbright & Jaworski L.L.P.
                                      300 Convent St., Suite 2200
                                      San Antonio, Texas 78205
                                      Fax number:  (210) 270-7205
                                      Attention:  Phillip M. Renfro
</TABLE>

     4.4  Expenses.  Except  as  otherwise  set forth herein or in any agreement
          --------
executed  in  connection  herewith  all  costs  and  expenses  related  to  the
Distribution  and  the  transactions  contemplated hereby shall be borne by POC.

     4.5  Entire Agreement. This Agreement, including the Schedules, Annexes and
         ----------------
other  writings  referred  to  herein  or delivered pursuant hereto, the Omnibus
Agreement  dated  of even date herewith between POC and RVP and the Contribution
Agreement  constitute  the  entire  agreement  between  POC,  RVP  and  the  Tax
Subsidiaries  of RVP with respect to the subject matter hereof and supersede all
other  agreements,  representations,  warranties,  statements,  promises  and
understandings,  whether  oral  or  written,  with respect to the subject matter
hereof.  This  Agreement  may  not  be  amended, altered or modified except by a
writing  signed by duly authorized officers of POC, RVP and the Tax Subsidiaries
of  RVP.

     4.6  Waiver. No consent or waiver, express or implied, by a party hereto to
          ------
or of any breach or default by the other party hereto in the performance by such
other  party  of  its

<PAGE>
obligations  hereunder  will be deemed or construed to be a consent or waiver to
or  of any other breach or default in the performance by such other party of the
same or any other obligations of such other party hereunder. Failure on the part
of  a  party  to  complain of any act or failure to act of the other party or to
declare  the  other  party  in  default,  irrespective  of how long such failure
continues,  will  not constitute a waiver by such party of its rights hereunder.
The giving of consent by a party in any one instance will not limit or waive the
necessity  to  obtain  such  party's  consent  in  any  future  instance.

     4.7  Binding  Effect;  Assignment;  No  Third  Party  Benefit.
          --------------------------------------------------------

          (a)  This  Agreement  will be binding upon and inure to the benefit of
and  be  enforceable  by  the parties hereto and their respective successors and
permitted  assigns.  None of the parties to this Agreement may assign its rights
under  this  Agreement  without  the  prior  written consent of all of the other
parties;  provided,  however,  POC  may assign any of its rights and obligations
under  this Agreement to any Subsidiary of POC, without the consent of any other
party  to  this  Agreement.

          (b)  Nothing  in this Agreement, express or implied, is intended to or
shall  confer  upon  any person other than RVP, POC, the RVP Indemnified Parties
and  the  Tax Subsidiaries of RVP any rights, benefits or remedies of any nature
whatsoever  under  or  by  reason  of  this  Agreement.

     4.8  Counterparts.  This Agreement may be executed simultaneously in two or
          ------------
more  counterparts,  each of which shall be deemed an original, but all of which
together  shall  constitute  one  and  the  same  agreement.

     4.9  References. All references in this Agreement to Articles, Sections and
          ----------
other  subdivisions  refer  to  the Articles, Sections and other subdivisions of
this  Agreement unless expressly provided otherwise. The words "this Agreement",
"herein",  "hereof",  "hereby", "hereunder" and words of similar import refer to
this Agreement as a whole and not to any particular subdivision unless expressly
so  limited.

     4.10  Terminology.  All  personal  pronouns used in this Agreement, whether
           -----------
used  in  the  masculine,  feminine  or  neuter  gender,  will include all other
genders;  and  the singular will include the plural and vice versa. The headings
of the Articles and Sections of this Agreement are included for convenience only
and  will  not  be  deemed to constitute part of this Agreement or to affect the
construction  hereof  or  thereof.

     4.11  Severability.  Any  provision of this Agreement that is determined by
           ------------
arbitration  as  provided  herein  or  a  court  of competent jurisdiction to be
invalid,  illegal  or  unenforceable  shall be ineffective to the extent of such
invalidity,  illegality  or  unenforceability,  without affecting in any way the
remaining  provisions hereof in such jurisdiction or rendering that or any other
provision  of  this  Agreement invalid, illegal or unenforceable, so long as the
material  purposes  of  this Agreement can be determined and effectuated. Should
any  provision  of  this  Agreement  be  so  declared  invalid,  illegal  or
unenforceable,  the  parties  shall agree on a valid provision to substitute for
it.

<PAGE>
     4.12 Further Assurances. Each party hereto agrees to do all acts and things
          ------------------
and  to make, execute and deliver such written instruments, as will from time to
time  be  reasonably  required  to  carry  out  the terms and provisions of this
Agreement.

     4.13  Amendments.  Any  term  of  this  Agreement  may  be  amended and the
           ----------
observance  of  any  term  of  this  Agreement  may be waived, only by a written
instrument  executed  by  POC,  RVP  and  the  Tax  Subsidiaries  of  RVP.

                         [SIGNATURES ON FOLLOWING PAGE]

<PAGE>
     IN  WITNESS  WHEREOF,  the  parties  hereto have executed this Distribution
Agreement  as of the date first set forth in the introduction to this Agreement.

                                     PENN  OCTANE  CORPORATION

                                     By: /s/ Richard Shore, Jr.
                                        -----------------------------------
                                             Richard  Shore,  Jr.,
                                             President

                                     RIO VISTA ENERGY PARTNERS L.P.

                                     By: RIO VISTA GP LLC,
                                         its General Partner

                                         By:/s/ Richard Shore, Jr.
                                            -------------------------------
                                                Richard Shore, Jr.,
                                                President

<PAGE>

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