BORCO

I met with Jaime Vargas, President of BORCO and his staff including Matthew=
Missick, Maxwell Sweeting and Jan Olson on Monday morning regarding the pr=
oposed tank repair financing for storage payback. BORCO is highly motivated=
to do this deal and wants to supersize it ($10 million). Jaime's confident=
ial comment to Jan "was we need to do this deal." Last Thursday, BORCO had =
their board meeting in Freeport and all of the PDVSA attendees approved the=
structure and concept of our deal. Jaime went on to say that PDVSA would l=
ook favorably on any term product purchase due to our new relationship with=
BORCO. Obviously, the devil is in the monthly storage numbers and our wi=
llingness to commit, but we can get very cheap tankage relative to other Ca=
rib storage facilities. BORCO is going to revert with monthly fees for one =
and two turns on all of the following liquid fuels: crude, jet, diesel, gas=
oline and resid. They are also checking the premium to LIBOR they are willi=
ng to pay and if we can lower the interest rate premium they will in turn r=
educe the storage rate further.=20

Please give this storage opportunity some thought and I will soon schedule =
a video conference to discuss.