UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

---------------------------

FORM 10-Q

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[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

For the quarterly period ended MARCH 31, 2006

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

For the transition period from _________ to __________

COMMISSION FILE NUMBER 0-6247

ARABIAN AMERICAN DEVELOPMENT COMPANY
(Exact name of registrant as specified in its charter)

DELAWARE 75-1256622
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)

10830 NORTH CENTRAL EXPRESSWAY, SUITE 175 75231
DALLAS, TEXAS (Zip code)
(Address of principal executive offices)

Registrant's telephone number, including area code: (214) 692-7872

Former name, former address and former fiscal year, if
changed since last report.
NONE

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days.

YES [X] NO [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer (as defined in Rule 12b-2 of the
Act).
LARGE ACCELERATED FILER [ ] ACCELERATED FILER [ ] NON-ACCELERATED FILER [X]

Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Act).

YES [ ] NO [X]

Number of shares of the Registrant's Common Stock (par value $0.10 per share),
outstanding at March 31, 2006: 22,731,994.

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

ARABIAN AMERICAN DEVELOPMENT COMPANY AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

MARCH 31, DECEMBER 31,
2006 2005
------------ -----------

ASSETS
CURRENT ASSETS
Cash $ 1,389,938 $ 1,738,558
Trade Receivables, Net 11,409,956 12,972,657
Financial Contracts 501,060 74,752
Inventories 758,600 1,164,674
------------ ------------
Total Current Assets 14,059,554 15,950,641

PLANT, PIPELINE AND EQUIPMENT 18,710,084 17,905,048
Less: Accumulated Depreciation (9,953,101) (9,678,443)
------------ ------------
Net Plant, Pipeline and Equipment 8,756,983 8,226,605

AL MASANE PROJECT 36,976,109 36,804,098
OTHER INTERESTS IN SAUDI ARABIA 2,431,248 2,431,248
MINERAL PROPERTIES IN THE UNITED STATES 1,058,556 1,058,492
OTHER ASSETS 2,816,220 2,476,865
------------ ------------

TOTAL ASSETS $ 66,098,670 $ 66,947,949
============ ============

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts Payable $ 626,431 $ 1,787,353
Accrued Liabilities 3,497,132 1,638,742
Accrued Liabilities in Saudi Arabia 2,162,875 2,407,282
Notes Payable 11,025,833 11,025,833
Current Portion of Long-Term Debt 1,425,932 1,425,932
------------ ------------

Total Current Liabilities 18,738,203 18,285,142

LONG-TERM DEBT 5,854,375 9,838,662
DEFERRED REVENUE 1,655,010 1,732,556
MINORITY INTEREST IN CONSOLIDATED SUBSIDIARIES 806,655 808,443

STOCKHOLDERS' EQUITY
COMMON STOCK-authorized 40,000,000
shares of $.10 par value; issued and
outstanding, 22,431,994 shares in 2006
and 2005 2,247,199 2,243,199
ADDITIONAL PAID-IN CAPITAL 36,568,206 36,512,206
RETAINED EARNINGS (ACCUMULATED DEFICIT) 229,022 (2,472,259)
------------ ------------
Total Stockholders' Equity 39,044,427 36,283,146
------------ ------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 66,098,670 $ 66,947,949
============ ============

See notes to consolidated financial statements.

ARABIAN AMERICAN DEVELOPMENT COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

THREE MONTHS ENDED
MARCH 31
--------------------------
2006 2005
------------ -----------

REVENUES
Petrochemical Product Sales $ 23,586,369 $16,350,780
Processing Fees 730,004 1,034,714
------------ -----------
24,316,373 17,385,494

OPERATING COSTS AND EXPENSES
Cost of Petrochemical Product
Sales and Processing 18,399,203 12,441,134
General and Administrative 1,371,855 1,147,706
Depreciation 274,659 148,732
------------ -----------
20,045,717 13,737,572
------------ -----------

OPERATING INCOME 4,270,656 3,647,922

OTHER INCOME (EXPENSE)
Interest Income 49,688 8,611
Interest Expense (145,852) (228,311)
Minority Interest 1,789 2,099
Miscellaneous Income 103,069 22,383
------------ -----------

8,694 (195,218)
------------ -----------

INCOME FROM CONTINUING
OPERATIONS BEFORE INCOME TAXES 4,279,350 3,452,704

INCOME TAXES 1,578,069 --
------------ -----------

INCOME FROM CONTINUING OPERATIONS 2,701,281 3,452,704

DISCONTINUED OPERATIONS
Income from Operations of Coin -- 487,132
------------ -----------

INCOME FROM DISCONTINUED OPERATIONS -- 487,132
------------ -----------

NET INCOME $ 2,701,281 $ 3,939,836
============ ===========

Basic Earnings per Common Share
Income from Continuing Operations $ 0.119 $ 0.152
Discontinued Operations -- 0.021
------------ -----------
Net Income $ 0.119 $ 0.173
============ ===========
Basic Weighted Average Number
of Common Shares Outstanding 22,765,327 22,731,994
============ ===========

Diluted Earnings per Common Share
Income from Continuing Operations $ 0.118 $ 0.152

Discontinued Operations -- 0.021
------------ -----------
Net Income $ 0.118 $ 0.173
============ ===========
Diluted Weighted Average Number
of Common Shares Outstanding 22,916,106 22,731,994
============ ===========

See notes to consolidated financial statements.

ARABIAN AMERICAN DEVELOPMENT COMPANY AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 2006

RETAINED
COMMON STOCK ADDITIONAL EARNINGS
---------------------- PAID-IN (ACCUMULATED
SHARES AMOUNT CAPITAL DEFICIT) TOTAL
---------- ---------- ----------- ------------ -----------

DECEMBER 31, 2005 22,431,994 $2,243,199 $36,512,206 $ (2,472,259) $36,283,146

Common Stock
Issued to Employees 40,000 4,000 56,000 -- 60,000

Net Income -- -- -- 2,701,281 2,701,281
---------- ---------- ----------- ------------ -----------

MARCH 31, 2006 22,471,994 $2,247,199 $36,568,206 $ 229,022 $39,044,427
========== ========== =========== ============ ===========

See notes to consolidated financial statements.

ARABIAN AMERICAN DEVELOPMENT COMPANY AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

THREE MONTHS ENDED
MARCH 31,
-------------------------
2006 2005
----------- -----------

OPERATING ACTIVITIES
Net Income $ 2,701,281 $3,939,836
Adjustments to Reconcile Net Income
To Net Cash Provided by Operating Activities:
Depreciation 274,659 148,732
Decrease in Deferred Revenue (77,546) (11,705)
Unrealized Gain on Financial Contracts (426,308) (1,217,120)
Common Stock Compensation Expense 60,000 --
Changes in Operating Assets and Liabilities:
Decrease in Trade Receivables 1,562,701 50,510
(Increase) Decrease in Inventories 406,074 (1,335,351)
Increase in Other Assets (339,355) (137,226)
Increase in Accounts Payable and Accrued Liabilities 721,156 (103,141)
Increase in Accrued Interest (23,688) (120,372)
Increase in Accrued Liabilities in Saudi Arabia (244,407) (249,971)
Other (1,788) (2,099)
----------- -----------
NET CASH PROVIDED BY OPERATING ACTIVITIES 4,612,779 962,093
----------- -----------

INVESTING ACTIVITIES
Additions to Al Masane Project (172,011) (53,787)
Additions to Plant, Pipeline and Equipment (805,037) (800,318)
Reduction in Mineral Properties in the United States (64) (423)
----------- -----------

NET CASH USED IN INVESTING ACTIVITIES (977,112) (854,528)
----------- -----------

FINANCING ACTIVITIES
Additions to Notes Payable and Long-Term Obligations -- 100,000
Reduction of Notes Payable and Long-Term Obligations (3,984,287) (573,771)
----------- -----------

NET CASH USED IN FINANCING ACTIVITIES (3,984,287) (473,771)
----------- -----------

NET DECREASE IN CASH (348,620) (366,206)

CASH AT BEGINNING OF PERIOD 1,738,558 623,202
----------- -----------

CASH AT END OF PERIOD $ 1,389,938 $ 256,996
=========== ===========

See notes to consolidated financial statements.

ARABIAN AMERICAN DEVELOPMENT COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1. BASIS OF PRESENTATION

The consolidated financial statements reflect all adjustments (consisting
only of normal and recurring adjustments) which are, in the opinion of
management, necessary for a fair presentation of Arabian American
Development Company and Subsidiaries financial position and operating
results for the interim period. Interim period results are not necessarily
indicative of the results for the calendar year. For additional
information please refer to the consolidated financial statements and
footnotes thereto and to Management's Discussion and Analysis of Financial
Condition and Results of Operations included in the Company's December 31,
2005 Annual Report on Form 10-K.

These financial statements include the accounts of Arabian American
Development Company (the "Company") and its wholly-owned subsidiary,
American Shield Refining Company (the "Petrochemical Company" or "ASRC"),
which owns all of the capital stock of Texas Oil and Chemical Company II,
Inc. ("TOCCO"). TOCCO owns all of the capital stock of South Hampton
Resources, Inc., formerly known as South Hampton Refining Co. ("South
Hampton"), and, until June 9, 2005, approximately 99.9% of the capital
stock of Productos Quimicos Coin, S.A. de C.V. ("Coin"), a specialty
petrochemical products company located near Coatzacoalcos, Mexico. South
Hampton owns all of the capital stock of Gulf State Pipe Line Company,
Inc. ("Gulf State"). The Company also owns approximately 55% of the
capital stock of a Nevada mining company, Pioche-Ely Valley Mines, Inc.
("Pioche"), which does not conduct any substantial business activity. The
Petrochemical Company and its subsidiaries constitute the Company's
Specialty Petrochemicals Segment. Pioche and the Company's mineral
properties in Saudi Arabia constitute its Mining Segment.

2. INVENTORIES

Inventories include the following:

MARCH 31, 2006 DECEMBER 31, 2005
-------------- -----------------

Petrochemical products $ 758,600 $ 1,164,674
============== =================

Inventories are recorded at the lower of cost, determined on the last-in,
first-out method (LIFO), or market. At March 31, 2006 and December 31,
2005, current cost exceeded LIFO value by approximately $663,000 and
$601,000, respectively,

3. NET INCOME PER COMMON SHARE

The following table (in thousands, except per share amounts) sets forth
the computation of basic and diluted net income per share for the three
months ended March 31, 2006 and 2005, respectively.

THREE MONTHS ENDED THREE MONTHS ENDED
MARCH 31, 2006 MARCH 31, 2005
--------------------------- -------------------------
Per Share Per Share
Income Shares Amount Income Shares Amount

BASIC NET INCOME PER SHARE:
Income from continuing operations $2,701 22,765 $ 0.119 $3,453 22,732 $ 0.152

Dilutive stock options outstanding 151
------ -------- --------- ------ ------ ---------
DILUTED NET INCOME PER SHARE:
Income from continuing operations $2,701 22,916 $ 0.118 $3,453 22,732 $ 0.152
====== ======== ========= ====== ====== =========

THREE MONTHS ENDED THREE MONTHS ENDED
MARCH 31, 2006 MARCH 31, 2005
--------------------------- -------------------------
Per Share Per Share
Income Shares Amount Income Shares Amount

BASIC NET INCOME PER SHARE:
Income from discontinued operations $ -- 22,765 $ 0.000 $ 487 22,732 $ 0.021

Dilutive stock options outstanding 151
------ -------- --------- ------ ------ ---------

DILUTED NET INCOME PER SHARE:
Income from discontinued operations $ -- 22,916 $ 0.000 $ 487 22,732 $ 0.021
====== ======== ========= ====== ====== =========

BASIC NET INCOME PER SHARE:

Net income $2,701 22,765 $ 0.119 $3,940 22,732 $ 0.173

Dilutive stock options outstanding 151
------ -------- --------- ------ ------ ---------

DILUTED NET INCOME PER SHARE:
Net income $2,701 22,916 $ 0.118 $3,940 22,732 $ 0.173
====== ======== ========= ====== ====== =========

For the three months ended March 31, 2005, options for 400,000 shares were
excluded from diluted shares outstanding because their effect was
anti-dilutive.

4. SEGMENT INFORMATION

As discussed in Note 1, the Company has two business segments. The Company
measures segment profit or loss as operating income (loss), which
represents income (loss) before interest, minority interest, miscellaneous
income and foreign exchange transaction gain or loss. Information on the
segments is as follows:

THREE MONTHS ENDED MARCH 31, 2006 PETROCHEMICAL MINING TOTAL
- ------------------------------------ ------------- --------------- ---------------

Continuing operations:
Revenue from external customers $ 24,316,373 $ -- $ 24,316,373
Depreciation 274,621 38 274,659
Operating income (loss) 4,560,727 (290,071) 4,270,656

Total assets $ 25,251,327 $ 40,847,343 $ 66,098,670

THREE MONTHS ENDED MARCH 31, 2005 PETROCHEMICAL MINING TOTAL
- ------------------------------------------------- ------------- -------------- ------------

Continuing operations
Revenue from external customers $ 17,385,494 $ -- $ 17,385,494
Depreciation 148,732 -- 148,732
Operating income (loss) 3,770,559 (122,637) 3,647,922

Discontinued operations (Productos Quimicos Coin)
Revenue from external customers $ 1,331,996 $ -- $ 1,331,996
Depreciation -- -- --
Operating income 366,576 -- 366,576

Total assets $ 13,707,032 $ 40,134,829 $ 53,841,861

Information regarding foreign operations for the three months ended March
31, 2006 and 2005 follows (in thousands). Revenues are attributed to
countries based upon the origination of the transaction.

THREE MONTHS ENDED
MARCH 31,
--------------------
2006 2005
--------- ---------

REVENUES
United States $ 24,316 $ 17,385
Mexico -- 1,332
Saudi Arabia -- --
--------- ---------
$ 24,316 $ 18,717
========= ========
LONG-LIVED ASSETS
United States $ 9,815 $ 7,201
Mexico -- --
Saudi Arabia 39,407 38,906
--------- --------
$ 49,222 $ 46,107
========= ========

5. LEGAL PROCEEDINGS

For the period ending March 31, 2006, South Hampton had no outstanding
lawsuits.

In August 1997 the Executive Director of the Texas Commission on
Environmental Quality (TCEQ) filed a preliminary report and petition with
TCEQ alleging that South Hampton violated various TCEQ rules, TCEQ permits
issued to South Hampton, a TCEQ order issued to South Hampton, the Texas
Water Code, the Texas Clean Air Act and the Texas Solid Waste Disposal
Act. The violations generally relate to the management of volatile organic
compounds in a manner that allegedly violates TCEQ's air quality rules and
the storage, processing and disposal of hazardous waste in a manner that
allegedly violates TCEQ's industrial and hazardous waste rules. No action
occurred on this item in the first quarter of 2006. See the 10-K Report as
of December 31, 2005 for more detail on this topic.

6. LONG-TERM DEBT

A contract was signed on June 1, 2004 between South Hampton and a supplier
for the purchase of 65,000 barrels per month of natural gasoline on open
account for the period from June 1, 2004 through May 31, 2006 and year to
year thereafter with 30 days written notice of termination by either
party. The contract requires South Hampton to begin reducing its current
debt to the supplier by $250,000 per quarter beginning July 1, 2004.
Therefore, $1.0 million of the balance of approximately $2.38 million has
been classified as current at March 31, 2006. The supplier is currently
the sole provider of the facility's feedstock supply. On June 1, 2005, the
contract was extended to May 31, 2007 and in November 2005 the contract
was amended to cover 80,000 barrels per month.

At March 31, 2005, Coin had a loan to a Mexican bank in the amount of
$2,044,096, payable in quarterly payments through March 2007, bearing
interest at the LIBOR rate plus seven points (LIBOR was 3.34% at June 30,
2005) and collateralized by a second lien on the plant facilities. The
note balance and unpaid interest of $2,601,587 was extinguished when the
stock of Coin was sold on June 9, 2005 (see Note 8).

In the first quarter of 2006 TOCCO paid dividends to ASRC in amounts
sufficient to repay approximately $40,000 of the liability to its
President and Chief Executive Officer. During the first quarter of 2006,
$147,000 of this liability was paid and $1,128,000 remained outstanding.

7. DERIVATIVE INSTRUMENTS

Statement of Financial Accounting Standard (SFAS) No. 133, "Accounting for
Derivative Instruments and Hedging Activities," as amended by SFAS Nos.
138 and 149, establishes accounting and reporting standards for derivative
instruments and hedging activities. SFAS No. 133 establishes accounting
and reporting standards requiring that every derivative instrument be
recorded in the balance sheet as either an asset or liability measured at
its fair value. The statement requires that changes in the derivative
instrument's fair value be recognized currently in earnings unless
specific hedge accounting criteria are met. Special accounting for
qualifying hedges allows a derivative instrument's gains and losses to
offset related results on the hedged item in the income

statement, to the extent effective, and requires that a company must
formally document, designate and assess the effectiveness of transactions
that receive hedge accounting treatment.

On January 30, 1992, the Board of Directors of TOCCO adopted a resolution
authorizing the establishment of a commodities trading account to take
advantage of opportunities to lower the cost of feedstock and natural gas
for its subsidiary, South Hampton. The policy adopted by the Board
specifically prohibits the use of the account for speculative
transactions. The operating guidelines adopted by management generally
limit exposures to 50% of the monthly feed volumes to the facility for up
to six months forward and up to 100% of the natural gas requirements.
Except in rare cases, the account uses options and financial swaps to meet
the targeted goals. These derivative agreements are not designated as
hedges per SFAS 133, as amended. TOCCO had option contracts outstanding as
of March 31, 2006 covering various natural gas price movement scenarios
through October of 2006 and covering from 50% to 100% of the natural gas
requirements for each month. As of the same date, TOCCO had committed to
financial swap contracts for up to 50% of its required monthly feed stock
volume with settlement dates through September of 2006. For the three
months ended March 31, 2006 and 2005, the net realized gain (loss) from
the derivative agreements was approximately $(167,000) and $342,000,
respectively. There was an estimated unrealized gain for the three months
ended March 31, 2006 and 2005 of approximately $426,308 and $1,217,120,
respectively. The realized and unrealized gains are recorded in Cost of
Petrochemical Product Sales and Processing for the periods ended March 31,
2006 and 2005.

In March 2006 a margin call was made on the financial swaps for $700,000,
due to a temporary decrease in the price of natural gasoline. As of March
31, 2006 this amount is recorded in Other Assets in the consolidated
balance sheet, as a prepayment against potential hedge settlements.

8. DISCONTINUED OPERATIONS

A creditor (bank) of Coin, holding a first lien, initiated a mortgage
foreclosure proceeding that resulted in the court ordered public auction
of the plant facilities in Mexico on February 23, 2004. As a result, the
court awarded the plant facilities to the creditor in partial settlement
of the outstanding debt owed by Coin. The court order required legal
transfer of the assets to the creditor within three days; however, the
transfer was delayed by the legal filings of the Company. Ultimately,
management and Coin's legal counsel were unable to determine if or when
the legal transfer of ownership would occur. As a result, management
recorded the loss on the foreclosure of the facility with a charge to
consolidated operations of $2,900,964 during the fourth quarter of 2004.
In April 2005 management ceased operating the plant and shut down the
facility. In late April 2005 management met with a third party who had a
contract with the Mexican bank to take over the Coin facility in the event
the foreclosure proceedings were completed. An agreement was reached
whereby the Company would sign appropriate documentation transferring
title to the facility in exchange for relief from certain outstanding
liabilities. In exchange for an orderly and clean transfer of title, the
Company received relief from the remaining outstanding bank interest and
penalties of approximately $530,000, was relieved of severance liabilities
of approximately $160,000 due the remaining employees at the Coatzacoalcos
location, and received $100,000 cash with which to satisfy miscellaneous
expenses associated with closing the Mexico City office. Documentation was
completed and signed on May 19, 2005.

On June 9, 2005, the Company sold the stock in the Mexican corporation to
an independent third party in Mexico and essentially ceased all operations
in the country. The stock was sold for an immaterial amount and the sale
was designed to allow the third party to make use of the accumulated tax
losses. The Company recorded a gain on disposal of Coin of approximately
$5.9 million. There are no material continuing liabilities associated with
the Company's prior ownership of the Coin operation.

9. SUBSEQUENT EVENTS

On April 27, 2006, Nicholas N. Carter, Secretary/Treasurer of the Company,
and serving as President of the petrochemical companies, was elected to
the Board of Directors to replace Mohammed O. Al-Omair who resigned for
personal reasons effective April 1, 2006. Mr. Carter has worked with the
petrochemical companies since 1977. Mr. Carter is also the sole owner of
Silsbee Trading and Transportation Corp. (STTC) which leases trucks and
equipment to South Hampton for their transportation needs. STTC derives
95% of its income from the leases with South Hampton.

In April of 2006 the Company entered into negotiations with Bank of
America to establish a new banking relationship including a revolving line
of credit for the petrochemical segment. The President was authorized on
April 26, 2006, to establish the accounts and to enter into such
agreements as necessary to develop the line of credit. Documentation is
being prepared and is expected to be completed in the second quarter of
2006.

In May of 2006 the Company extended its application of the natural gas
hedging program to cover the months of September 2006 through October of
2007 with various structures designed to give the price volatility
protection that management felt should be in place. See RESULTS OF
OPERATIONS for more information.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.

GENERAL

Statements in Part 1, Item 2 as well as elsewhere in, or incorporated by
reference in, this Quarterly Report on Form 10-Q regarding the Company's
financial position, business strategy and plans and objectives of the
Company's management for future operations and other statements that are
not historical facts, are "forward-looking statements" as that term is
defined under applicable Federal securities laws. In some cases,
"forward-looking statements" can be identified by terminology such as
"may," "will," "should," "expects," "plans," "anticipates,"
"contemplates," "proposes," believes," "estimates," "predicts,"
"potential" or "continue" or the negative of such terms and other
comparable terminology. Forward-looking statements are subject to risks,
uncertainties and other factors that could cause actual results to differ
materially from those expressed or implied by such statements. Such risks,
uncertainties and factors include, but are not limited to, general
economic conditions domestically and internationally; insufficient cash
flows from operating activities; difficulties in obtaining financing;
outstanding debt and other financial and legal obligations; competition;
industry cycles; feedstock, specialty petrochemical product and mineral
prices; feedstock availability; technological developments; regulatory
changes; environmental matters; foreign government instability; foreign
legal and political concepts; and foreign currency fluctuations, as well
as other risks detailed in the Company's filings with the U.S. Securities
and Exchange Commission, including this Quarterly Report on Form 10-Q, all
of which are difficult to predict and many of which are beyond the
Company's control.

On August 25, 2005, South Hampton legally changed its name from South
Hampton Refining Co. to South Hampton Resources, Inc. The former name had
been used by South Hampton since the late 1970's when it was involved in
the processing of crude oil and the production of motor fuels. Since South
Hampton had emphasized the petrochemical and specialty product business
for the past twenty years and no longer produced motor fuels of any
nature, it was felt the name was misleading and needed to be changed.

LIQUIDITY AND CAPITAL RESOURCES

The Company operates in two business segments, specialty petrochemicals
(which is composed of the entities owned by the Petrochemical Company) and
mining. Its corporate overhead needs are minimal. A discussion of each
segment's liquidity and capital resources follows.

SPECIALTY PETROCHEMICALS SEGMENT. Historically, this segment has
contributed all of the Company's internally generated cash flows. As the
petroleum markets have fluctuated the last twenty years, South Hampton has
been able to adapt by raising prices, cutting costs, shifting focus, or
developing new markets as necessary. When oil prices began their dramatic
rise in 2004, TOCCO had financial swaps in place which protected it
against sudden and volatile price swings in feedstock prices and to a
lesser extent, fuel gas costs. Product demand also grew in 2004 and
continued into 2005. These conditions allowed the Petrochemical segment to
report significant earnings and to meet continued volatility of the
markets in the future. The Company also moved to take advantage of the
increased demand by increasing its production capacity by 30% in the first
quarter of 2005.

South Hampton obtains its feedstock requirements from a sole source
vendor. On May 7, 2004, South Hampton and the supplier signed a letter of
intent whereby the supplier would assist with the capital required to
expand a toll processing unit for a large customer. As security for the
funds used to purchase capital equipment and to secure outstanding debts
for feedstock purchased from the supplier, South Hampton executed a
mortgage in June 2004 covering most of the existing facility's equipment.
South Hampton elected not to take advantage of the equipment financing
portion of the agreement but continues to purchase feedstock from the
vendor and to secure those purchases with a lien on fixed assets.

A contract was signed on June 1, 2004 between South Hampton and the
supplier for the purchase of 65,000 barrels per month of natural gasoline
on open account for the period from June 1, 2004 through May 31, 2006 and
year to year thereafter with thirty

days written notice of termination by either party. On June 1, 2005, the
contract was extended through May 31, 2007. A provision of the contract
states that South Hampton will begin reducing the current debt to the
supplier by $250,000 per quarter beginning July 1, 2004. Therefore, $1
million of this debt has been classified as current at March 31, 2006. The
supplier is currently the sole provider of feedstock. At March 31, 2006,
South Hampton owed the supplier approximately $2.38 million.

On August 1, 2004, South Hampton entered into a capital lease with Silsbee
Trading and Transportation, which is owned by an officer of the Company,
for the purchase of a diesel powered man lift. The lease is for five years
with title transferring to South Hampton at the end of the term.

As mentioned in Note 6 to the consolidated financial statements, Coin was
not in compliance with certain covenants contained in its loan agreements
at March 31, 2005, and therefore, its creditors had the right to declare
the debt to be immediately due and payable. If this occurred, Coin would
have been unable to pay the entire amount due. On February 23, 2004, the
Coin plant facilities were awarded to a creditor in a foreclosure hearing.
The foreclosure was contested successfully until early 2005. On May 19,
2005, through a negotiated settlement, the facility was transferred to the
acquirer and on June 9, 2005, the stock in Coin was sold (see Note 8).

MINING SEGMENT. This segment is in the development stage. Its most
significant asset is the Al Masane mining project in Saudi Arabia, which
is a net user of the Company's available cash and capital resources.
Implementation of the project has been delayed over the last five years
because open market prices for metals were insufficient to attract
additional investment required to achieve production. As world economy and
metal prices have improved over the last year, investment viability has
improved and steps are being taken to take advantage of the improved
investment climate.

On February 23, 2004, the Company's President received a letter from the
Deputy Minister of Petroleum and Mineral Resources of the Kingdom of Saudi
Arabia stating that the Council of Ministers had issued a resolution,
dated November 17, 2003, which directed the Minister, or whomever he may
designate, to discuss with the President of the Company the implementation
of a work program, similar to that which is attached to the Company's
mining lease, to start during a period not to exceed two years and also
the payment of the past due surface rentals. If agreeable, a document is
to be signed to that effect. The resolution stated further that, if no
agreement is reached, the Ministry of Finance will give the Council of
Ministers its recommendation regarding the $11 million loan granted to the
Company.

After discussions with the Deputy Minister, the Company President
responded in a letter to the Minister dated March 23, 2004, that the
Company will agree to abide by the resolution and will start implementing
the work program to build the mine, treatment plant and infrastructure
within two years from the date of the signed agreement. The work program
was prepared by the Company's technical consultants and attached to the
letter. The Company also agreed to pay past due surface rentals, which
totaled approximately $586,000, in two equal installments, the first on
December 31, 2004 and the second on December 31, 2005, and to continue to
pay surface rentals as specified in the Mining Lease Agreement. On May 15,
2004, an agreement was signed with the Ministry covering these provisions.
If the Company does not implement the program during the two-year period,
the matter will be referred to the Ministry to seek direction in
accordance with the Mining Code and other concerned codes. The Company is
currently in the preliminary stages of negotiations with a viable joint
venture partner and feels that sufficient progress will be made by the May
deadline to justify an extension of time, if necessary, on agreement with
the Ministry. The Company paid $266,000 of the back lease payments on
January 3, 2005, and the remaining $320,000 on December 27, 2005. The
lease payments were brought fully current in the first quarter of 2006
with the payment of $234,000 for the years 2005 and 2006. The 2007 lease
payment of $117,000 will be due on January 1, 2007.

The Company is making preparations to implement the work program. After
initialization, the program will take approximately twenty-two months to
complete, after which commercial production would begin. The Company, on
April 20, 2005, signed an agreement with SNC-Lavalin Engineering and
Construction Company of Toronto, Canada ("SNC-Lavalin"), to update the
feasibility study. The updated study will allow the Company to pursue
potential joint venture partners to manage the project and to obtain
acceptable financing to commercially develop the program. The prices of
zinc, copper, gold and silver have increased significantly over the last
two years. The updated study was completed in August of 2005. The study by
SNC-Lavalin updated the estimated capital cost and operating expenses of
the project. The firm concluded that capital expenditure of approximately
$115 million is needed to bring the mine into production with an
additional $6.7 million for a cyanide leach process for gold recovery. The
study was then turned over to a separate and independent consultant for
further analysis and to allow the economic feasibility to be reviewed. The
consultant, Molinari and Associates, Inc. of Toronto, Canada, ("Molinari")
concluded that the study by SNC-Lavalin was conservative and there were
many opportunities for cost savings and improvements in the

projections as presented.

Metal prices were at record lows worldwide during 2003, and therefore,
mining projects were not economically feasible. As the prices have
recovered for the 2004-2005 time period,the project becomes near breakeven
over the three year period. If spot prices as of March 31, 2006, are used
in the analysis, or even the ten year average of prices is used, the
project becomes very economically attractive. Mining economics, as with
other capital intensive extractive industries such as offshore petroleum
exploration, will vary over time as market prices rise and fall with
worldwide economic performance.

The following chart illustrates the change from the low prices of 2003 and
2004 to current levels:

AVERAGE PRICE SPOT PRICE AS OF
FOR 2003-2005 03/31/2006 INCREASE

GOLD $406.00 per ounce $584.00 per ounce $178.00 per ounce
SILVER $ 6.29 per ounce $ 11.76 per ounce $ 5.47 per ounce
COPPER $ 1.26 per pound $ 2.42 per pound $ 1.16 per pound
ZINC $ 0.49 per pound $ 1.18 per pound $ 0.69 per pound

There is no assurance that even with favorable economic reports, a joint
venture partner can be located, a joint venture formed or, if it is
formed, that the joint venture would be able to obtain acceptable
financing for the project. Without a joint venture, the work program
cannot be accomplished as planned. Financing for the updated feasibility
study was provided by an advance from a major shareholder.

The Minister of Petroleum and Mineral Resources announced on April 2, 2002
that a new revised Saudi Arabian Mining Code would be issued, which would
expedite the issuance of licenses and has new incentives to encourage
investment by the private Sector, both Saudi and foreign, in the
development of mineral resources in Saudi Arabia. The mining code was
revised, approved by the Council of Ministers, and issued by Royal Decree
prior to the end of 2004.

The Company has communicated to the Minister of Petroleum and Mineral
Resources that the unreasonable delay in granting of the mining lease from
1983 to 1993 and the unreasonable threat of cancellation during 2000 to
2003, which was lifted in 2004, were the underlying reasons for the
Company's losses while maintaining its legal position in Saudi Arabia, and
which further caused the severe drop in the share price of its stock. A
request for fair compensation was made by the Company and denied by the
Ministry, as was a request for arbitration. The Company is consulting with
counsel on further steps which might be taken; however, any such action
will not affect the Company's right to implement the Al Masane project.

On June 22, 1999, the Company submitted a formal application for a
five-year exclusive mineral exploration license for the Greater Al Masane
Area of approximately 2,850 square kilometers, which surrounds the Al
Masane mining lease area and includes the Wadi Qatan and Jebel Harr areas.
The Company previously worked in the Greater Al Masane Area after
obtaining written authorization from the Saudi Ministry of Petroleum and
Mineral Resources, and has expended over $3 million in exploration work.
Geophysical, geochemical and geological work and diamond core drilling on
the Greater Al Masane area has revealed mineralization similar to that
discovered at Al Masane. The application for the new exploration license
is still pending and may be acted upon now that the new Saudi Arabian
Mining Code was issued; however, as is frequently the case when making
such applications with the Ministry, there is no timetable for action on
the application.

Management is also addressing two other significant financing issues
within this segment. These issues are the $11 million note payable to the
Saudi Arabian government and accrued salaries and termination benefits of
approximately $1,007,000 due employees working in Saudi Arabia (this
amount does not include any amounts due the Company's President and Chief
Executive Officer who also primarily works in Saudi Arabia and was owed
approximately $1,255,000 at December 31, 2005 and $1,128,000 as of March
31, 2006).

Regarding the note payable, this loan was originally due in ten annual
installments beginning in 1984. The Company has neither made any
repayments nor received any payment demands or other communications
regarding the note payable from the Saudi government. By memorandum to the
King of Saudi Arabia in 1986, the Saudi Ministry of Finance and National
Economy recommended that the $11 million note be incorporated into a loan
from the Saudi Industrial Development Fund ("SIDF") to finance 50% of the
cost of the Al Masane project, repayment of the total amount of which
would be made through a mutually agreed upon repayment schedule from the
Company's share of the operating cash flows generated by the project. The
Company remains active in Saudi Arabia and received the Al Masane mining
lease at a time when it had not made any of the agreed upon repayment
installments. Based on its experience to date, management believes that as
long as the Company diligently attempts to explore and develop the Al
Masane project no repayment demand will be made. Based on its
interpretation of the Al Masane

mining lease and other documents, management believes the government is
likely to agree to link repayment of this note to the Company's share of
the operating cash flows generated by the commercial development of the Al
Masane project and to a long-term installment repayment schedule. In the
event the Saudi government demands immediate repayment of this obligation,
which management considers unlikely, the Company would be unable to pay
the entire amount due.

With respect to the accrued salaries and termination benefits due
employees working in Saudi Arabia, the Company plans to continue employing
these individuals depending upon the needs of the mining operation.
Management believes it has sufficient resources to manage this severance
liability as necessary. The President was paid approximately $140,000 in
early 2006, and plans are to further reduce the balance on a periodic
basis.

As noted previously, the Company's mineral interests in the United States
are its ownership interest in Pioche, which has been inactive for many
years. Its properties include 48 patented and 5 unpatented claims totaling
approximately 1,500 acres in Lincoln County, Nevada. There are prospects
and mines on these claims that previously produced silver, gold, lead,
zinc and copper. There is also a 300-ton-a-day processing mill on property
owned by Pioche. The mill is not currently in use and a significant
expenditure would be required in order to put the mill into continuous
operation, if commercial mining is to be conducted on the property. In
August 2004, the Company exercised its option to purchase 720,000 shares
of the common stock of Pioche at $0.20 a share for a total amount of
$144,000. Pioche agreed to accept payment for the stock purchase by the
cancellation of $144,000 of debt it owed to the Company. This purchase
increased the Company's ownership interest in Pioche to approximately 55%.

At this time, the Company has no definitive plans for the development of
its domestic mining assets. It periodically receives proposals from
outside parties who are interested in possibly developing or using certain
assets. Management will continue to review these proposals as they are
received, but at this time does not anticipate making any significant
domestic mining capital expenditures or receiving any significant proceeds
from the sale or use of these assets.

If the Company seeks additional outside financing to proceed with the
development of the mining segment, either foreign or domestic, there is no
assurance that sufficient funds can be obtained. It is also possible that
the terms of any additional financing that the Company would be able to
obtain would be unfavorable to the Company and its existing shareholders.

The Company's management and Board of Directors have many years of
experience in the exploration for, and development of, mineral prospects
in various parts of the world. Mr. John Crichton, Chairman of the Board,
has world wide experience as a renowned oil and mineral consultant to
major companies. He is the holder of a MSc. Degree in Petroleum
Engineering from MIT. Mr. Hatem El-Khalidi, who holds an MSc. Degree in
Geology from Michigan State University, is also a consultant in oil and
mineral exploration. Mr. El-Khalidi is the person who discovered the Al
Masane deposits, which under his direct supervision were subsequently
developed by the Company. The third board member, Mr. Ghazi Sultan, a
Saudi citizen, holds a MSc. Degree in Geology from the University of
Texas. Mr. Sultan served as the Saudi Deputy Minister of Petroleum and
Mineral Resources 1965-1988 and was responsible for the massive expansion
of the mineral resources section of the Ministry. In that position, a two
hundred million dollar annual budget was under his direct control and
supervision. Mr. Sultan supervised the work of the USGS (United States
Geological Survey) Mission in Saudi Arabia, the BRGM (French Government
Mineral Survey), and the British Riofenix Mission (owned by Rio Tinto
Mining Company). All of these studies explored and evaluated many mineral
deposits for the Ministry in Saudi Arabia with some becoming mines. The
fourth member of the Board is a Saudi citizen, Mr. Mohammad Al-Omair. Mr.
Al-Omair is the Senior Executive Vice President of Fal Holdings Company of
Saudi Arabia. Fal Holdings is one of the large industrial and business
holding companies in the Kingdom with offices in Riyadh, London, and
Portland, Oregon. Mr. Al-Omair recently submitted a letter to the Company
expressing his intention to resign for personal reasons as director
effective April 1, 2006 after serving since May of 1993. Mr. Sultan and
Mr. Al-Omair are members of the Audit and Executive Committees of the
Company. Mr. Nicholas Carter, the Company's Secretary and Treasurer, is a
graduate of Lamar University with a BBA Degree in Accounting, is a CPA,
and has extensive experience in the management of the Company's
petrochemical plant. His employment in the petrochemical business predates
the acquisition by the Company in 1987. Mr. Carter replaced Mr. Al-Omair
on the Board effective April 27, 2006.

RESULTS OF OPERATIONS

SPECIALTY PETROCHEMICALS SEGMENT. In the quarter ended March 31, 2006,
total petrochemical product sales and processing fees from continuing
operations increased approximately $6,931,000 or 40%, while the cost of
petrochemical sales and processing (excluding depreciation) increased
approximately $5,958,000 or 48% from the same period in 2005.
Consequently, the total gross profit margin on revenue in the first
quarter of 2006 increased approximately $973,000 or 20% compared to the
same period in 2005.

Sales from discontinued operations (the Productos Quimicos Coin
subsidiary) for the quarter decreased approximately $1,332,000 or 100%,
while its cost of sales (excluding depreciation) decreased approximately
$748,000 or 100%. Discontinued operations had no effect on gross profit
margin on product sales in this quarter, compared to a positive gross
profit margin of approximately $584,000 in the same quarter in 2005.

The Petrochemical segment completed a de-bottlenecking project on the
solvents unit during the later part of the first quarter of 2005. The
project added two new, larger fractionation towers and divided the solvent
production into two trains. Total capacity of the unit was increased by
approximately 30% and was functional by March 31, 2005. The Company
experienced typical mechanical reliability issues since the startup with
the increased volume. These issues were resolved as they arose, and the
Company is generally satisfied with the performance of the additional
equipment. Consistent operation at full capacity of the expanded equipment
was attained in the early part of the third quarter 2005. The project cost
approximately $1.5 million and was accomplished using current maintenance
department employees. No reportable injuries were recorded during the
effort.

During the first nine months of 2005 the Company experienced high
feedstock prices that fluctuated within a range, rather than continuing
the steady increase experienced in 2004--the exception being late August
when Hurricane Katrina hit the Gulf Coast. The damage in the Gulf
producing regions from Hurricane Katrina, followed by Hurricane Rita,
spiked the prices of all petroleum related materials. The Company was able
to maintain sufficient cash flow to cover increased natural gas and
transportation costs by keeping its product pricing at sufficient levels
coupled with the positive contribution from the hedging program.
Importantly, sales demand remained high during the last eighteen months
despite constant price increases to customers. Management attributes the
strong sales demand to improved general economic activity during the past
year and to growth in the industries served by the petrochemical product
lines. Growth of markets served has generally been 2% to 3% annually over
the last ten years. The Company's growth in volume has generally matched
that trend over the same time period, although with the recently expanded
capacity, the growth rate in sales has increased above the industry wide
growth rate.

By January of 2006 most of the feedstock price fluctuation generated by
the hurricanes had worked out of the markets, and prices remained fairly
steady throughout the quarter with only normal changes occurring. Sales
prices generated acceptable margins, and no price increases were
instituted. Demand remained very strong on most products, and the process
ran at near practical capacity with a 92% utilization rate. Small
operational equipment modifications were made as the Company continued to
fine tune the equipment which was added in the previous year.

Since late 2003 the Company has entered into derivative agreements to
dampen sudden price spikes and provide feedstock price protection.
Management believes that if the derivative agreements can moderate rate of
change in the overall cost of feedstock, product prices can be raised
sufficiently as needed to avoid the large losses experienced at times in
the past. Approximately 50% of the Company's monthly feedstock
requirements is covered at any one time. This ratio cushions price
increases and allows the Company to experience partial benefit when the
price drops. In the first quarter of 2006 the natural gasoline derivative
agreements had a realized loss of approximately $85,000 and an estimated
unrealized gain of approximately $426,000 for a total positive effect of
approximately $341,000. The program is designed to be insurance against
unforeseen dramatic price swings rather than as a speculative profit
center. It operates mostly as a "buy and hold" program.

The price of natural gas (fuel gas), which is the petrochemical
operation's largest single operating expense, continued to be high during
the first quarter of 2006 as compared to historical levels. Of course what
is historically considered a "high" price has changed within the industry
as the Company's natural gas price, including the effect of the hedge
program, has fluctuated within the $6.00 to $8.00 per mmbtu range for the
last twenty-four months. The Company has option contracts in place for
fuel gas through the third quarter of 2006 in order to minimize the impact
of price fluctuations in the market (see Note 9). The Company has also
been able to pass through price increases as they have occurred. In the
first quarter of 2006, the natural gas derivative agreements had a
realized loss of approximately $81,000. No unrealized gain occurred due to
the fact that the agreements outstanding had a net effect of zero.

Toll processing fee revenue for the first quarter of 2006 of approximately
$730,000 represents a decrease of approximately $305,000 or 29% below the
fees for the same period in 2005. This decrease can be attributed to the
shut down of one unit due to lack of feedstock availability from the
customer. The customer had resolved the feedstock shortage by the end of
the first

quarter and toll processing fees have rebounded sharply. The toll
processing customers are very active and remain on long-term contracts.
While there are some fluctuations in tolling volumes handled, toll
processing has developed into a stable business and the Company intends to
continue to develop opportunities when available. Toll processing fees are
expected to rise in the remainder of 2006 and beyond as expanded
facilities for a major customer were completed in October 2005. The
revised contract with this customer will generate additional processing
fees and contains a capital repayment feature. The project began
operations on schedule (considering the hurricane caused delay) and is
producing high quality products in the volumes requested by the customer.
There are shortages in the markets served by this process, and it is
expected the expanded unit will run at capacity for the remainder of 2006.

Interest expense decreased in the later part of 2005 primarily due to a
reduction in notes payable and the replacement of the factoring agreement
with a line of credit. While the volume of feedstock purchased is rising
because of expanded capacity, significant price changes in the petroleum
markets have also increased the dollar amount of such purchases. The
Company has absorbed most of the increased working capital needs through
cash flow, and the line of credit is only partially used. Insurance
expenses are expected to remain flat throughout 2006 with the exception of
property coverage. The hurricanes are expected to cause the premiums for
that line of coverage to increase significantly upon renewal in June of
2006. Various means of negating the effect of this increase will be
considered.

MINING SEGMENT AND GENERAL CORPORATE EXPENSES. None of the Company's other
operations generate significant operating or other revenues. The minority
interest amount represents the Pioche minority stockholders' shares of the
losses from the Pioche operations. Pioche losses are primarily
attributable to the costs of maintaining the Nevada mining properties.

The Company assesses the carrying values of its assets on an ongoing
basis. Factors which may affect the carrying values of the mining
properties include, but are not limited to, mineral prices, capital cost
estimates, estimated operating costs of any mines and related processing,
ore grade and related metallurgical characteristics, design of any mines
and the timing of any mineral production. Prices currently used to assess
the recoverability of the Al Masane project costs for 2006 are $2.42 per
pound for copper and $1.18 per pound for zinc for the projected life of
the mine. Copper and zinc comprise in excess of 80% of the expected value
of production. Using these price assumptions, there were no asset
impairments at March 31, 2006. There are no assurances that, particularly
in the event of a prolonged period of depressed mineral prices, the
Company will not be required to take a material write-down of its mineral
properties in the future.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK.

Other than as disclosed, there have been no material changes in the
Company's exposure to market risk from the disclosure included in the
Company's Annual Report on Form 10-K for the fiscal year ended December
31, 2005.

ITEM 4. CONTROLS AND PROCEDURES.

The Company carried out an evaluation, under the supervision and with the
participation of Company management, including the Company's President and
Chief Executive Officer and Treasurer, of the effectiveness of the
Company's disclosure controls and procedures, as of the end of the period
covered by this report. Based upon that evaluation, the President and
Chief Executive Officer and Treasurer concluded that, as of the end of the
period covered by this report, the Company's disclosure controls and
procedures were effective such that information relating to the Company
(including its consolidated subsidiaries) required to be disclosed in the
Company's Securities and Exchange Commission reports (i) is recorded,
processed, summarized and reported within the time periods specified in
the Securities and Exchange Commission rules and forms and (ii) is
accumulated and communicated to the Company's management, including the
President and Chief Executive Officer and Treasurer, as appropriate, to
allow timely decisions regarding required disclosure.

During the period covered by this report, there were no changes in the
Company's internal control over financial reporting that have materially
affected, or are reasonably likely to materially affect, the Company's
internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

Reference is made to Note 5 to the consolidated financial statements
contained in this Report for a discussion of material pending legal
proceedings.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

ISSUER PURCHASES OF EQUITY SECURITIES

The following table sets forth information about the Company's Common
Stock repurchases during the three months ended March 31, 2006:

(c) (d)
(a) Total Number of Shares Maximum Number of
Total Number of (b) Purchased as Part of Shares that May Yet
Shares Average Price Publicly Announced be Purchased Under
Period Purchased Paid Per Share Plans or Programs the Plans or Programs
- ------------------------ --------------- -------------- ---------------------- ----------------------

January 1, 2006 through
January 31, 2006 -- $ -- -- --

February 1, 2006 through
February 28, 2006 -- $ -- -- --

March 1, 2006 through
March 31, 2006 -- $ -- -- --
-------------- ---------------------- ----------------------

Total -- $ -- -- --
============== ====================== ======================

ITEM 3. DEFAULTS ON SENIOR SECURITIES.

Reference is made to Notes 5, 6 and 8 to the consolidated financial
statements and Part I. Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations contained in this Report for
a discussion of the $11 million note payable to the Saudi Arabian
government.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

NONE.

ITEM 5. OTHER INFORMATION.

NONE.

ITEM 6. EXHIBITS.

The following documents are filed or incorporated by reference as exhibits
to this Report. Exhibits marked with an asterisk (*) are management
contracts or a compensatory plan, contract or arrangement.

EXHIBIT
NUMBER DESCRIPTION
- ------- ----------------------------------------------------------------------------

3(a) - Certificate of Incorporation of the Company as amended through the
Certificate of Amendment filed with the Delaware Secretary of State on July
19, 2000 (incorporated by reference to Exhibit 3(a) to the Company's Annual
Report on Form 10-K for the year ended December 31, 2000 (File No. 0-6247)).

3(b) - Bylaws of the Company, as amended through March 4, 1998 (incorporated by
reference to Exhibit 3(b) to the Company's Annual Report on Form 10-K for
the year ended December 31, 1999 (File No. 0-6247)).

10(a) - Contract dated July 29, 1971 between the Company, National Mining
Company and Petromin (incorporated by reference to Exhibit 10(a) to the
Company's Annual Report on Form 10-K for the year ended December 31, 1999
(File No. 0-6247)).

10(b) - Loan Agreement dated January 24, 1979 between the Company, National
Mining Company and the Government of Saudi Arabia (incorporated by reference
to Exhibit 10(b) to the Company's Annual Report on Form 10-K for the year
ended December 31, 1999 (File No. 0-6247)).

10(c) - Mining Lease Agreement effective May 22, 1993 by and between the
Ministry of Petroleum and Mineral Resources and the Company (incorporated by
reference to Exhibit 10(c) to the Company's Annual Report on Form 10-K for
the year ended December 31, 1999 (File No. 0-6247)).

10(d) - Stock Option Plan of the Company, as amended (incorporated by reference
to Exhibit 10(d) to the Company's Annual Report on Form 10-K for the year
ended December 31, 1999 (File No. 0-6247)).*

10(e) - Letter Agreement dated May 3, 1991 between Sheikh Kamal Adham and the
Company (incorporated by reference to Exhibit 10(j) to the Company's Annual
Report on Form 10-K for the year ended December 31, 1999 (File No. 0-6247)).

10(f) - Promissory Note dated February 17, 1994 from Hatem El-Khalidi to the
Company (incorporated by reference to Exhibit 10(k) to the Company's Annual
Report on Form 10-K for the year ended December 31, 1999 (File No. 0-6247)).

10(g) - Letter Agreement dated August 15, 1995 between Hatem El-Khalidi and the
Company (incorporated by reference to Exhibit 10(l) to the Company's Annual
Report on Form 10-K for the year ended December 31, 1999 (File No. 0-6247)).

10(h) - Letter Agreement dated August 24, 1995 between Sheikh Kamal Adham and
the Company (incorporated by reference to Exhibit 10(m) to the Company's
Annual Report on Form 10-K for the year ended December 31, 1999 (File No.
0-6247)).

10(i) - Letter Agreement dated October 23, 1995 between Sheikh Fahad Al-Athel
and the Company (incorporated by reference to Exhibit 10(n) to the Company's
Annual Report on Form 10-K for the year ended December 31, 1999 (File No.
0-6247)).

EXHIBIT
NUMBER DESCRIPTION
- ------- ----------------------------------------------------------------------------

10(j) - Letter Agreement dated November 30, 1996 between Sheikh Fahad Al-Athel
and the Company (incorporated by reference to Exhibit 10(o) to the Company's
Annual Report on Form 10-K for the year ended December 31, 2001 (File No.
0-6247)).

10(k) - Purchase and Sale Agreement/Security Agreement dated July 29, 2003
between Southwest Bank of Texas, N.A. and South Hampton Refining Company,
together with related Restricted Payments Letter Agreement and Guaranty of
Texas Oil & Chemical Co. II, Inc. (incorporated by reference to Exhibit
10(s) to the Company's Annual Report on Form 10-K for the year ended
December 31, 2002 (File No. 0-6247)).

10(l) - Equipment Lease Agreement dated November 14, 2003, between Silsbee
Trading and Transportation Corp. and South Hampton Refining Company
(incorporated by reference to Exhibit 10(o) to the Company's Annual Report
on Form 10-K for the year ended December 31, 2003 (File No. 0-6247)).

10(m) - Pledge Agreement dated as of May 15, 2001, by Arabian American
Development Company, American Shield Refining Company, Fahad Al-Athel, Hatem
El-Khalidi, Ingrid El-Khalidi and Preston Peak (incorporated by reference to
Exhibit 10(p) to the Company's Annual Report on Form 10-K for the year ended
December 31, 2003 (File No. 0-6247)).

10(n) - Security Agreement and Deed of Trust dated June 1, 2004 between South
Hampton Refining Company and Martin Operating Partnership, L.P.
(incorporated by reference to Exhibit 10(p) to the Company's Quarterly
Report on Form 10-Q for the quarter ended June 30, 2004 (File No. 0-6247)).

10(o) - Addendum to Equipment Lease Agreement dated August 1, 2004, between
Silsbee Trading and Transportation Corp. and South Hampton Refining Company
(incorporated by reference to Exhibit 10(q) to the Company's Quarterly
Report on Form 10-Q for the quarter ended September 30, 2004 (file No.
0-6247)).

10(p) - Letter Agreement dated May 7, 2005 between Sheikh Fahad Al-Athel and the
Company (incorporated by reference to Exhibit 10(p) to the Company's
Quarterly Report on Form 10-Q for the quarter ended March 31, 2005 (file No.
0-6247)).

10(q) - Loan Agreement dated June 30, 2005 between Texas Oil & Chemical Co.
II/South Hampton Refining Co. and The Catalyst Fund, LTD/Southwest/Catalyst
Capital, LTD. (incorporated by reference to Exhibit 10(q) to the Company's
Quarterly Report on Form 10-Q for the quarter ended June 30, 2005 (file No.
0-6247)).

10(r) - Judicial Agreement dated May 19, 2005 between Fabricante Y
Comercializadora Beta, S.A. de C.V. and Productos Coin, S.A.de C.V.
(incorporated by reference to Exhibit 10(r) to the Company's Quarterly
Report on Form 10-Q for the quarter ended June 30, 2005 (file No. 0-6247)).

10(s) - Agreement dated June 6, 2005 between Fabricante Y Comercializadora Beta,
S.A. de C.V. and Productos Quimicos Coin, S.A. de C.V. (incorporated by
reference to Exhibit 10(s) to the Company's Quarterly Report on Form 10-Q
for the quarter ended June 30, 2005 (file No. 0-6247)).

EXHIBIT
NUMBER DESCRIPTION
- ------- ----------------------------------------------------------------------------

10(t) - Mercantile Shares Purchase and Sale Agreement dated June 9, 2005 between
Texas Oil & Chemical Co. II. Inc. and Ernesto Javier Gonzalez Castro and
Mauricio Ramon Arevalo Mercado. (incorporated by reference to Exhibit 10(t)
to the Company's Quarterly Report on Form 10-Q for the quarter ended June
30, 2005 (file No. 0-6247)).

10(u) - Natural Gasoline Feedstock Handling Agreement dated September 21, 2005
between South Hampton Resources, Inc. and Martin Gas Sales (incorporated by
reference to Exhibit 10(u) to the Company's Quarterly Report on Form 10-Q
for the quarter ended September 30, 2005 (file No. 0-6247)).

10(v) - Pipeline Use, Right of Way Option and Right of First Refusal Agreement
dated September 21, 2005 between Gulf State Pipe Line Co., Inc. and Martin
Gas Sales Sales (incorporated by reference to Exhibit 10(v) to the Company's
Quarterly Report on Form 10-Q for the quarter ended September 30, 2005 (file
No. 0-6247)).

10(w) - Loan Agreement dated October 31, 2005 between South Hampton Resources,
Inc. and Amegy Bank National Association Sales (incorporated by reference to
Exhibit 10(w) to the Company's Annual Report on Form 10-K for the year ended
December 31, 2005 (file No. 0-6247)).

31.1 - Certification of Chief Executive Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.

31.2 - Certification of Chief Financial Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.

32.1 - Certification of Chief Executive Officer pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2 - Certification of Chief Financial Officer pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

DATE: May 15, 2006 ARABIAN AMERICAN DEVELOPMENT COMPANY
----------------------------------------
(Registrant)

By: /s/ NICHOLAS CARTER
------------------------------------
Nicholas Carter Secretary/Treasurer
(Authorized Officer and Principal
Financial Officer)