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Houston-based Par Petroleum Corporation announced on Tuesday a new supply and offtake agreement for its 94,000 bpd refinery in Hawaii.

The deal was signed between Hawaii Independent Energy, LLC (HIE), Par's wholly-owned subsidiary, and J. Aron & Company, the commodity trading arm of Goldman Sachs.

HIE has agreed to purchase from Aron mutually agreed crude oil cargos for use in the refinery. Aron, in turn, will purchase the refined products produced at the facility at market prices. HIE will then repurchase the refined products from Aron and sell them to its customers.

According to Par, this arrangement is expected to result in approximately $20 million in additional cash and liquidity under current market conditions. Added benefits include increased liquidity, a reduction in HIE's crude acquisition cost and increased flexibility to manage market price fluctuations.

As part of the agreement, HIE may defer payments to Aron of up to $125 million or 85 percent of certain receivables and company-owned inventory.

The agreement has a term of three years, with two one-year extension options.

Joseph Israel, Par's president and CEO, said that the deal with Aron provides a cost-effective and flexible structure for its crude oil needs and helps to maximize the capacity utilization of its refinery.

"Securing this new arrangement generates additional liquidity and is an important step towards further improving the future performance of our refinery," he added.