FIRSTAMENDMENT TO CREDIT AGREEMENT

Loans. The Bank has heretofore made a $2,500,000 term loan to the Borrower and upon satisfaction of the conditions precedent set forth in this First Amendment, the Bank agrees to make a $2,150,000 non-revolving line of credit available to the Borrower to finance a portion of the construction of three tanks and a dock on the Property. Advances will be made monthly upon the Bank's receipt of a request for advance, copies of any draw request and for copies of invoices related to the work to be completed.

Distributions. Redeem, retire, purchase or otherwise acquire, directly or indirectly, any of its Equity Interests, return any contribution to an Equity Owner or, other than stock dividends and dividends paid to the Borrower, declare or pay any Distributions; provided, however, that if there is no existing default under this Agreement or any other Related Documents and to do so will not cause a default under any of such agreements, the Borrower may pay Distributions to its Equity Owner (Blackwater Midstream Corp) up to the maximum amount of $2,150,000 during any fiscal year beginning with the fiscal year ending March 31, 2011.

Convertible Notes. The Borrower will cause Backwater Midstream Corp. ("BWMS") to restructure its convertible debt notes in the aggregate amount of $3,000,000, so that (i) by June 30, 2010 the holders of at least $1,000,000 of said notes will have either extended the maturity date of said notes to a date not earlier than September 30, 2014, or converted said notes to common stock of BWMS, or a combination of both; (ii) by August 31, 2010 the holders of an aggregate of at least $2,000,000 of said notes will have either extended the maturity date of said notes to a date not earlier than September 30, 2014 or converted said notes to common stock of BWMS, or a combination of both; and (iii) by October 31, 2010, the holder of an aggregate of at least $2,850,000 of such notes will have either extended the maturity of said notes to a date not earlier than September 30, 2014 or will have converted said notes to common stock of BWMS, or a combination of both. For purposes of this provision replacement of the notes with other notes with a maturity date not earlier than September 30, 2014 shall be considered the same as an extension of the maturity date of the original notes. So long as the payment thereof will not cause an Event of Default under Section 5.2M, the Borrower may make principal payments during prior to September 30, 2014 in an aggregate amount not to exceed $150,000.