Blue Dolphin Energy Company (BDCO)

[56Chevy]

Agree on all points EI.

Arbitration situation aside the take-aways from this report are that all parties remain engaged and focused on a solution/settlement. And I'm particularly encouraged to see the improvements to the plant have been completed.

During the year ended December 31, 2017, we continued aggressive actions to improve operations and liquidity. We began selling certain of our refined petroleum products immediately following production, which minimizes inventory, improves cash flow, and reduces commodity risk/exposure. We completed construction on several new petroleum storage tanks at the Nixon Facility. Increased petroleum storage capacity: (i) assists with de-bottlenecking the facility, (ii) supports increased refinery throughput up to approximately 30,000 bpd, and (iii) provides an opportunity to generate additional tank rental revenue by leasing to third-parties. We also reduced our working capital requirements in a rising cost environment by decreasing costs, reducing inventory levels, improving our sales cycle, and requiring pre-payments from certain customers.