Black Wax Crude is a unique form of crude and is desirable for its low sulfur content and potential for the creation of high value wax and lube products, Calumet said in an announcement released Thursday. Current Black Wax Crude production and drilling activities within the basin have been curtailed due to limited takes by Salt Lake City refiners driven by the entry of Canadian crude oil supply into the marketplace.

The memorandum contemplates transportation of Black Wax Crude from Utah to Calumets Shreveport, La., refinery in the short term, and the potential construction of refining and processing facilities on the Ute Reservation.

Maxine Natchees, chairman of the Ute Tribe, said, the tribe needs to secure a long-term market for its crude resource, and after studying all of the options and potential partners, selected Calumet for its specialty refining expertise to jointly develop strategies to increase refining capacity for Utah Black Wax Crude, including the potential development of a greenfield refinery in northeast Utah.

F. William Grube, president and CEO of Calumet, said the company has been familiar with the tribes Black Wax Crude for several years and has experience refining its unique characteristics. We look forward to exploring the potential for a long-term, mutually beneficial relationship with the tribe, he said.

Posted paraffinic base oil prices are unchanged in the United States this week. Crude closed at $61.89 per barrel yesterday on the New York Mercantile Exchange, according to Bloomberg. That was $2.75 below the price a week ago.