UNITED STATES Office Serial number
DEPARTMENT OF THE INTERIOR NEW ORLEANS, LA OCS-G 9372
MINERALS MANAGEMENT SERVICED

Rental rate per
acre, or fraction
SULPHUR AND SALT LEASE OF Cash bonus thereof
SUBMERGED LANDS UNDER THE OUTER $ 3,401,757.00 $ 3.00 PER ACRE
CONTINENTAL SHELF LANDS ACT

THIS FORM DOES NOT CONSTITUTE AN INFORMATION COLLECTION AS
DEFINED BY 44 U.S.C. 3502 AND THEREFORE DOES NOT REQUIRE Minimum royalty rate
APPROVAL BY THE OFFICE OF MANAGEMENT AND BUDGET. per acre, or fraction
thereof Royalty rate
$ 3.00 12 1/2 PERCENT - SULPHUR
5 PERCENT - SALT TAKEN OFFSITE

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This lease is effective as of May 1, 1988 (hereinafter called the "Effective
Date") and shall continue for an initial period of TEN years (hereinafter
called the "Initial Period") by and between the United States of America
(hereinafter called the "Lessor"), by the REGIONAL DIRECTOR, GULF OF MEXICO
OCS REGION, Minerals Management Service, its authorized officer, and

FREEPORT-MCMORAN RESOURCE PARTNERS, LIMITED PARTNERSHIP 58.33000%

IMC FERTILIZER, INC. 25.00000%

FELMONT OIL CORPORATION 16.67000%

(hereinafter called the "Lessee"). In consideration of any cash payment
heretofore made by the Lessee to the Lessor and in consideration of the
promises, terms, conditions, and covenants contained herein, including the
Stipulation(s) numbered 1 AND 3 attached hereto, the Lessee and Lessor agree
as follows:

SEC. 1. STATUTES AND REGULATIONS. This lease is issued pursuant to the
Outer Continental Shelf (OCS) Lands Act (43 U.S.C. 1331-1356, (1953)), as
amended, and the regulations issued thereunder (30 CFR Part 256). The lease
is issued subject to the Act; all regulations issued pursuant to the Act and
in existence upon the Effective Date of this lease; all regulations issued
pursuant to the statute in the future which provide for the prevention of
waste and conservation of the natural resources of the Outer Continental
Shelf and the protection of correlative rights therein; and all other
applicable statutes and regulations.

SEC. 2. RIGHTS OF LESSEE. The Lessor hereby grants and leases to the
Lessee the exclusive right and privilege to drill for, develop, and produce
sulphur and salt resources in the submerged lands of the Outer Continental
Shelf containing approximately 4,560.81 acres (hereinafter referred to as the
"leased area"), described as follows:

ALL OF BLOCK 299, MAIN PASS AREA, SOUTH AND EAST ADDITION, OCS LEASING MAP,
LOUISIANA MAP NO. 10A.

These rights include:

(a) the nonexclusive right to conduct within the leased area geological
and geophysical exploration in accordance with applicable regulations;

(b) the nonexclusive right to drill water wells within the leased area,
unless the water is part of geopressured-geothermal and associated resources,
and to use the water produced therefrom for operations pursuant to the Act
free of cost, on the condition that the drilling is conducted in accordance
with procedures approved by the Director of the Minerals Management Service
or the Director's delegate (hereinafter called the "Director"); and

(c) the right to construct or erect and to maintain within the leased
area artificial islands, installations, and other devices permanently or
temporarily attached to the seabed and other works and structures necessary
to the full enjoyment of the lease, subject to compliance with applicable
laws and regulations.

SEC. 3. TERM. This lease shall continue from the Effective Date of the
lease for the Initial Period and so long thereafter as sulphur and/or salt
are produced from the leased area in paying quantities, or drilling or well
reworking operations, as approved by the Lessor, are conducted thereon, or as
otherwise provided by regulations.

SEC. 4. RENTALS. The Lessee shall pay the Lessor, on or before the first
day of each lease year which commences prior to a discovery in paying
quantities of sulphur and/or salt on the leased area, a rental as shown on
the face hereof.

SEC. 5. MINIMUM ROYALTY. The Lessee shall pay the Lessor, at the
expiration of each lease year which commences after a discovery of sulphur
and/or salt in paying quantities, a minimum royalty as shown on the face
hereof or, if there is production, the difference between the actual royalty
required to be paid with respect to such lease year and the prescribed
minimum royalty if the actual royalty paid is less than the minimum royalty.

SEC. 6. ROYALTY ON PRODUCTION.

(a) The Lessee shall pay a fixed royalty as shown on the face hereof in
value of production saved, removed, or sold from the leased area. Any Lessee
is liable for royalty payments on sulphur and/or salt lost or wasted from a
lease site when such loss or waste is due to negligence on the part of the
operator of the lease, or due to the failure to comply with any rule or
regulation, order, or citation issued under the Act.

(b) The value of production for purposes of computing royalty on
production from this lease shall never be less than 5 percent of the gross
production or value of the sulphur at the mine. The value of production
shall be the estimated reasonable value of the production as determined by
the Lessor, due consideration being given to the highest price paid for a
part or for a majority of sulphur and/or salt of like quality in the same
general area, to the price received by the Lessee, to posted prices, and to
other relevant matters. Except when the Lessor, in its discretion, determines
not to consider special pricing relief from otherwise applicable Federal
regulatory requirements, the value of production for the purposes of
computing royalty shall not be deemed to be less than the gross proceeds
accruing to the Lessee from the sale thereof. in the absence of good reason
to the contrary, value computed on the basis of the highest price paid or
offered at the time of production in a fair and open market for the major
portion of like quality sulphur produced and sold from the field or area
where the leased area is situated will be considered to be a reasonable value.

(c) Royalties shall be due and payable by the last day of the next
month following the month in which the sulphur and/or salt is produced,
unless the Lessor prescribes a later date.

SEC. 7. PAYMENTS. The Lessee shall make all payments (rentals, royalties,
and any other payments required by this lease) to the Lessor by electronic
transfer of funds, check, draft on a solvent bank, or money order unless
otherwise provided by regulations or by direction of the Lessor. Rentals,
royalties, and any other payments required by this lease shall be made
payable to the Minerals Management Service and tendered to the Director.
Determinations made by the Lessor as to the amount of payment due shall be
presumed to be correct and paid as due.

SEC. 8. BONDS. The Lessee shall maintain at all times the bond(s) required
by regulation prior to the issuance of the lease and shall furnish such
additional security as may be required by the Lessor if, after operations
have begun, the Lessor deems such additional security to be necessary.

SEC. 9. PLANS. The Lessee shall conduct all operations on the leased area
in accordance with approved exploration plans and approved development and
production plans as are required by regulations. The Lessee may depart from
an approved plan only as provided by applicable regulations.

SEC. 10. PERFORMANCE. The Lessee shall comply with all regulations and
Orders. After due notice in writing, the Lessee shall drill such wells and
produce at such rates as the Lessor may require in order that the leased area
or any part thereof may be properly and timely developed and produced in
accordance with sound operating principles.

SEC. 11. SAFETY REQUIREMENTS. The Lessee shall:

(a) maintain all places of employment within the leased area in
compliance with occupational safety and health standards and, in addition,
free from recognized hazards to employees of the Lessee or of any contractor
or subcontractor operating within the lease area;

(b) maintain all operation within the leased area in compliance with
regulations or orders intended to protect persons, property, and the
environment on the Outer Continental Shelf; and

(c) allow prompt access, at the site of any operation subject to safety
regulations, to any authorized Federal inspector and shall provide any
documents and records which are pertinent to occupational or public health,
safety, or environmental protection as may be requested.

SEC. 12. SUSPENSION AND CANCELLATION.

(a) The Lessor may suspend or cancel this lease pursuant to Section 5 of
the Act, and compensation shall be paid when provided by the Act.

(b) The lessor may, upon recommendation of the secretary of Defense,
during a state of war or national emergency declared by Congress or the
President of the United States, suspend operations under the lease, as
provided in section 12(c) of the Act, and just compensation shall be paid to
the Lessee for such suspension.

SEC. 13. INDEMNIFICATION. The Lessee shall indemnify the Lessor for, and
hold it harmless from, any claim, including claims for loss or damage to
property or injury to person caused by or resulting from any operation on the
leased area conducted by or on behalf of the Lessee. However, the Lessee
shall not be held responsible to the Lessor under this section for any loss,
damage, or injury caused by or resulting from:

(a) negligence of the Lessor other than the commission or omission of a
discretionary function or duty on the part of a Federal Agency whether or not
the discretion involved is abused; or

(b) the Lessee's compliance with an order or directive of the Lessor
against which an administrative appeal by the Lessee is filed before the
cause of action for the claim arises and is pursued diligently thereafter.

SEC. 14. PURCHASE OF PRODUCTION. In time of war or when the President of
the United States shall so prescribe, the Lessor shall have the right of
first refusal to purchase at the market price all or any portion of the
sulphur and/or salt produced from the leased area, as provided in Section
12(b) of the Act.

SEC. 15. EQUAL OPPORTUNITY CLAUSE. During the performance of this lease,
the Lessee shall fully comply with paragraphs (1) through (7) of section 202
of Executive Order 11246, as amended (reprinted in 41 CFR 60-1.4(a)), and the
implementing regulations which are for the purpose of preventing employment
discrimination against persons on the basis of race, color, religion, sex, or
national origin. paragraphs (1) through (7) of section 202 of Executive
Order 11246, as amended, are incorporated in this lease by reference.

SEC. 16. CERTIFICATION OF NONSEGREGATED FACILITIES. By entering into this
lease, the Lessee certifies, as specified in 41 CFR 60-1.8, that it does not
and will not maintain or provide for its employees any segregated facilities
at any of its establishments and that it does not and will not permit its
employees to perform their services at any location under its control where
segregated facilities are maintained. As used in this certification, the
term "segregated facilities" means, but is not limited to, any waiting rooms,
work areas, restrooms and washrooms, restaurants and other eating areas,
timeclocks, locker rooms and other storage or dressing areas, parking lots,
drinking fountains, recreation or entertainment areas, transportation, and
housing facilities provided for employees which are segregated by explicit
directive or are in fact segregated on the basis of race, color, religion, or
national origin, because of habit, local custom, or otherwise. The Lessee
further agrees that it will obtain identical certifications from proposed
contractors and subcontractors prior to award of contracts or subcontracts
unless they are exempt under 41 CFR 60-1.5.

SEC. 17. RESERVATIONS TO LESSOR. All rights in the leased area not
expressly granted to the Lessee by the Act, the regulations, or this lease
are hereby reserved to the Lessor. Without limiting the generality of the
foregoing, reserved rights included:

(a) the right to authorize geological and geophysical exploration in
the lease area which does not unreasonably interfere with or endanger actual
operations under the lease, and the right to grant such easements or
rights-of-way upon, through, or in the leased area as may be necessary or
appropriate to working of other lands or to the treatment and shipment of
products thereof by or under authority of the Lessor;

(b) the right to grant leases for any minerals other than sulphur
and/or salt within the leased area, except that operations under such leases
shall not unreasonably interfere with or endanger operations under this lease;

(c) the right, as provided in section 12(d) of the Act, to restrict
operations in the leased area or any part thereof which may be designated by
the Secretary of Defense, with

approval of the President, as being within an area needed for national
defense and, so long as such designation remains in effect, no operations may
be conducted on the surface of the leased area or the part thereof included
within the designation except with the concurrence of the Secretary of
Defense. If operations or production under this lease within any designated
area are suspended pursuant to this paragraph, any payments of rentals and
royalty prescribed by this lease likewise shall be suspended during such
period of suspension of operations and production, the term of this lease
shall be extended by adding thereto any such suspension period, and the
Lessor shall be liable to the Lessee for such compensation as is required to
be paid under the Constitution of the United States.

SEC. 18. TRANSFER OF LEASE. The Lessee shall file for approval with the
appropriate field office of the Minerals Management Service any instrument of
assignment or other transfer of this lease, or any interest therein, in
accordance with applicable laws and regulations.

SEC. 19. SURRENDER OF LEASE. The Lessee may surrender this entire lease or
any officially designated subdivision of the leased area by filing with the
appropriate field office of the Minerals Management Service a written
relinquishment, in triplicate, which shall be effective as of the date of
filing. No surrender of this lease or of any portion of the leased area
shall relieve the Lessee or its surety of the obligation to pay all accrued
rentals, royalties, and other financial obligations or to abandon all works
on the area to be surrendered in a manner satisfactory to the Director.

SEC. 20. REMOVAL OF PROPERTY ON TERMINATION OF LEASE. Within a period of 1
year after termination of this lease in whole or in part, the Lessee shall
remove all devices, works, and structures from the premises no longer subject
to the lease in accordance with applicable regulations and orders of the
Director. However, the Lessee may, with the approval of the Director,
continue to maintain devices, works, and structures on the leased area for
drilling or producing on other Leases.

SEC. 21. REMEDIES IN CASE OF DEFAULT.

(a) Whenever the Lessee fails to comply with any of the provisions of
the Act, the regulations issued pursuant to the Act, or the terms of this
lease, the lease shall be subject to cancellation in accordance with the
provisions of section 5(c) and (d) of the Act and the Lessor may exercise any
other remedies which the Lessor may have, including the penalty provisions of
section 24 of the Act. Furthermore, pursuant to section 8(o) of the Act, the
Lessor may cancel the lease if it is obtained by fraud or misrepresentation.

(b) Nonenforcement by the Lessor of a remedy for any particular
violation of the provisions of the Act, the regulations issued pursuant to
the Act, or the terms of this lease shall not prevent the cancellation of
this lease or the exercise of any other remedies under paragraph (a) of this
section for any other violation or for the same violation occurring at any
other time.

SEC. 22. UNLAWFUL INTEREST. No member of, or Delegate to, Congress, or
Resident Commissioner, after election or appointment, or either before or
after they have qualified, and during their continuance in office, and no
officer, agent, or employee of the Department of the Interior, except as
provided in 43 CFR Part 20, shall be admitted to any share or part in this
lease or derive any benefit that may arise therefrom. The provisions of
Section 3741 of the Revised Statutes, as amended, 41 U.S.C. 22, and the Act
of June 25, 1948, 62 Stat. 702, as amended, 18 U.S.C. 431-433, relating to
contracts made or entered into or accepted by or on behalf of the United
States, form a part of this lease insofar as they may be applicable.

SEC. 23. SPECIAL PROVISIONS.

(a) Any lease issued for an initial period of 10 years will be canceled
after 5 years, following notice pursuant to the Outer Continental Shelf Lands
Act, where drilling of an exploratory well has not been commenced before the
end of the 5th year, or if the well has not been drilled in conformance with
the approved exploration plan criteria, or if there is not a suspension of
operations in effect.

(b) The Lessee is granted the exclusive right to drill salt wells
within the leased area and to use the salt produced therefrom for
sulphur-mining operations pursuant to the Act free of royalty on the lease,
on the condition that the drilling is conducted in accordance with procedures
approved by the Director.

(c) The Lessee shall pay no royalty on salt produced and consumed or
otherwise used on the lease for the production of sulphur. The Lessee shall
pay a fixed royalty of 5% at the mine for any salt produced and used or
otherwise disposed of off the leased area for purposes other than sulphur
production.

United States
Department of the Interior
Minerals Management Service

Outer Continental Shelf, Central Gulf of Mexico
Sulphur and Salt Lease Sale

OCS-G 9372

STIPULATION NO. 1--PROTECTION OF ARCHAEOLOGICAL RESOURCES

(1) "Archaeological resource" means any prehistoric or historic district,
site, building, structure, or object (including shipwrecks); such term
includes artifacts, records, and remains which are related to such a
district, site, building, structure, or object (Section 301(5), National
Historic Preservation Act, as amended, 16 U.S.C. 470w(5)). "Operations"
means any drilling, mining, or construction or placement of any structure for
exploration, development, or production of the lease.

(2) If the Regional Director (RD) believes an archaeological resource may
exist in the lease area, the RD will notify the lessee in writing. The
Lessee shall then comply with subparagraphs (a) through (c).

(a) Prior to commencing any operations, the lessee shall prepare a
report, as specified by the RD, to determine the potential existence of any
archaeological resource that may be affected by operations. The report,
prepared by an archaeologist and a geophysicist, shall be based on an
assessment of data from remote-sensing surveys and of other pertinent
archaeological and environmental information. The lessee shall submit this
report to the RD for review.

(b) If the evidence suggests that an archaeological resource may be
present, the lessee shall either:

(i) Locate the site of any operation so as not to adversely affect
the area where the archaeological resource may be; or

(ii) Establish to the satisfaction of the RD that an archaeological
resource does not exist or will not be adversely affected by operations.
This shall be done by further archaeological investigation, conducted by an
archaeologist and a geophysicist, using survey equipment and techniques
deemed necessary by the RD. A report on the investigation shall be submitted
to the RD for review.

(c) If the RD determines that an archaeological resource is likely to
be present in the lease area and may be adversely affected by operations, the
RD will notify the lessee immediately. The lessee shall take no action that
may adversely affect the archaeological resource until the RD has told the
lessee how to protect it.

(3) If the lessee discovers any archaeological resource while conducting
operations on the lease area, the lessee shall report the discovery
immediately to the RD. The lessee shall make every reasonable effort to
preserve the archaeological resource until the RD has told the lessee how to
protect it.

STIPULATION NO. 3--HYDROCARBON DISCOVERIES STIPULATION

Sulphur and salt leases are granted separately from oil and gas leases.
Therefore, any hydrocarbons discovered by the sulphur and salt lessee cannot
be produced under this lease. If the lessee discovers hydrocarbons while
conducting sulphur and salt operations on the lease area, the lessee shall
report the discovery immediately to the Regional Director (RD). If the RD
determines that the discovery is significant and the Director determines that
release of the information is necessary for the proper development of the
filed or area, then a public announcement of the significant hydrocarbon
discovery will be made pursuant to 30 CFR 250.3.

IMC Fertilizer, Inc. Felmont Oil Corporation
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(Lessee) (Lessee)

/s/ James L. Frye /s/ Richard A. Mills
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(Signature of Authorized Officer (Signature of Authorized Officer)

James L. Frye Richard A. Mills
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(Name of Signatory) (Name of Signatory)

Vice President, Service Operations Vice president
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(Title) (Title)

March 28, 1988 March 30, 1988
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(Date) (Date)

2315 Sanders Rd. 350 Glenborough, Ste. 300
Northbrook, Il 60062 Houston, TX 77067
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(Address of Lessee) (Address of Lessee)
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(Lessee) (Lessee)

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(Signature of Authorized Officer) (Signature of Authorized Officer)

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(Name of Signatory) (Name of Signatory)

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(Title) (Title)

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(Date) (Date)

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(Address of Lessee) (Address of Lessee)

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IF THIS LEASE IS EXECUTED BY A CORPORATION, IT MUST BEAR THE CORPORATE SEAL.