On September 25, 2008, Blackwater New Orleans, L.L.C. ("BNO"), a wholly-owned subsidiary of Blackwater Midstream Corp. (the "Company"), entered into an agreement (the "Purchase Agreement") with NuStar Terminals Operations Partnership L.P. ("NuStar") to purchase certain assets of NuStar, including but not limited to, approximately 26.5 acres of land located at the Port of New Orleans, Westwego, Louisiana, including the 800,000 barrel chemical storage facility and other improvements thereon, as well as certain licenses and permits to operate such facility (collectively, the "Storage Facility"). The Storage Facility is being purchased by BNO "as-is".

The purchase price for the Storage Facility is $4,800,000, subject to certain adjustments for prepaid third-party fees, adjustment to inventory and NuStar's transaction-related expenses. BNO paid $75,000 to NuStar on July 28, 2008 and $75,000 to NuStar upon execution of the Purchase Agreement, each of which constitutes a non-refundable payment towards the purchase price. In the event that asset purchase contemplated in the Purchase Agreement fails to close for any reason, NuStar will retain such deposit as a break-up fee. The balance of the purchase price is due at the closing.

Pursuant to the Purchase Agreement, each of NuStar and BNO agreed to indemnify the other for certain losses not to exceed $750,000, and the parties released one another from other liabilities. Certain conditions specified in the Purchase Agreement must be met prior to closing. If the closing does not take place by October 31, 2008, any party not in breach of the Purchase Agreement may terminate the Purchase Agreement.

In connection with the Purchase Agreement, JP Morgan Chase Bank, N.A. delivered a non-binding proposal to finance a portion of the purchase price of the Storage Facility, not to exceed the lesser of $2,500,000 or 50% of the cost of the acquisition.

(d) Exhibits.

EXHIBIT NO.        DESCRIPTION
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10.1               Asset Purchase Agreement dated September 25, 2008, by and
                   between NuStar Terminals Operations Partnership L.P. and
                   Blackwater New Orleans, L.P.
99.1               Press Release dated September 29, 2008