EXHIBIT 10.16

                       THE MERIDIAN RESOURCE CORPORATION
                      TMR EMPLOYEES TRUST WELL BONUS PLAN


                                  ARTICLE I.
                                    PURPOSE

      The Board of Directors of the Company creates this Bonus Plan for
personnel of the Company to be included in the TMR EMPLOYEES TRUST ("the
Trust")intending to advance the best interests of The Meridian Resource
Corporation ("the Company") by attracting and retaining top quality personnel
through this use of incentive bonuses for selected personnel within the eligible
group.

                                  ARTICLE II.
                                  DEFINITIONS

      2.1 "ANNIVERSARY DATE" means the last day of the fiscal year of the
Company.

      2.2 "BONUS" means the right awarded to the Trust to receive a bonus from
the Bonus Pool, pursuant to this Plan, in the amount set out in the Notice of
Bonus. The Trust's Bonus will be expressed as a percentage of the Bonus Pool, as
determined by the Compensation Committee. A Bonus once granted continues
pursuant to this Plan. Bonuses awarded from any given Bonus Pool may not exceed
one hundred percent (100%) of the given Bonus Pool.

      2.3 "BONUS DATE" means the last day of each quarter of each fiscal year of
the Company.

      2.4 "BONUS POOL" means a pool consisting of a percentage of the Net
Profits from a Designated Well, as determined by the Company, paid by the
Company to the Plan. Each Bonus Pool will be the basis for determining the Bonus
to be paid to the Trust. Each Bonus Pool will carry a name, which will
distinguish it from any other Bonus Pool and will include the fiscal year of its
designation. Each Bonus Pool will be separate from all other Bonus Pools. Each
Bonus Pool shall only contain one Designated Well. Each Bonus Pool will continue
until such time as the Compensation Committee, in its sole discretion,
determines no further Net Profits will be generated by the Designated Well for
that Bonus Pool or until the Trust terminates, or as otherwise determined
herein. Any Bonus Pool shall be subject to the terms, conditions, and provisions
of any agreement theretofore or thereafter entered into by the Company, which in
any way affects the Designated Well, monies or common stock of the Company.

      2.5 "CHARGEABLE EXPENDITURES" means the total sum of the following
expenses, incurred by the Company and its Internal Working Interest Partners,
associated, directly or indirectly, with a Designated Well:

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            (i)   the severance, production, excise, ad valorem, windfall
                  profits and other taxes on or measured by production
                  attributable to said Designated Well; PLUS

            (ii)  the cost of operating and maintaining a Designated Well
                  (normal lease operating expenses), exclusive of drilling well
                  overhead rates as provided for in any applicable joint
                  operating agreement, and exclusive of any costs and expenses
                  associated with establishment or enhancement of production
                  including but not limited to the costs of drilling, workovers
                  (other than normal lease operating expenses associated
                  therewith), re-drills, deepening, sidetracking, plugging back,
                  purchasing and setting surface equipment, and/or the
                  construction of pipeline or plant facilities; PLUS ----

            (iii) the fees or other consideration paid by the Company to any
                  third party, other than an affiliate of the Company, for
                  services in connection with marketing production of oil and/or
                  gas (and/or components and by products extracted therefrom)
                  from or attributable to such Designated Well.

      Chargeable Expenditures DOES NOT include any of the following:

            (i)   any and all lease burdens including, but not limited to,
                  landowner royalties, overriding royalties, net profits
                  interest payments, production payments, financing arrangements
                  and other similar interests which may burden any Designated
                  Well as a result of agreements between the Company and any
                  third parties;

            (ii)  capital expenditures associated with wells, production and
                  marketing facilities, including, but not limited to, the costs
                  of drilling, workovers (other than normal lease operating
                  expenses associated therewith), redrills, deepening,
                  sidetracking, plugging back, purchasing and setting surface
                  equipment, and/or the construction of pipeline or plant
                  facilities; and

            (iii) the acquisition and maintenance of mineral interest or the
                  geologic, geophysical and engineering evaluation relative to
                  any Designated Well.

      2.6   "COMPANY" means The Meridian Resource Corporation.

      2.7 "COMPENSATION COMMITTEE" means the Committee established by the Board
of Directors of the Company to administer this Plan.

      2.8 "DESIGNATED WELL" means a well (whether or not operated by the
Company) designated by the Compensation Committee, in its sole discretion, to be
included in this Plan. The Company may drill wells (whether or not operated by
the Company) that will not become a Designated Well.

      2.9 "INTERNAL WORKING INTEREST PARTNERS" means any and all parties
designated as such by the Company and who hold a cost sharing ownership
interest, either actual or beneficial, on a cash 

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basis by virtue of an agreement between the Company and any such parties in and
to any Designated Well.

      2.10 "NET PROFITS" means the proceeds received by the Company from the
sale of the oil, gas and minerals (including components and by products
extracted therefrom) that are produced, saved and sold from a Designated Well,
free and clear of all costs and expenses of exploration, development, operation,
production, marketing, processing, treating and transportation to the sales
point, LESS Chargeable Expenditures. If Chargeable Expenditures in any calendar
month exceed the proceeds in the same month for a particular well resulting in a
net loss, such net loss shall be carried forward and applied against the Net
Profits of the succeeding month, or months, for that particular well. The Net
Profits shall be subject to the terms, conditions and provisions of any joint
operating agreement or similar agreement at any time heretofore or hereafter
entered into by the Company with any third parties covering any Designated Well
including, but not limited to, provisions requiring forfeiture of interest for
nonparticipation and recoupment of multiple recovery costs. In the event any
such provisions of any third party agreement come into effect the Net Profit
payments shall be suspended until such costs are recovered or such cause for
suspension is removed. The Net Profits shall also be subject to the terms,
conditions and provisions of any farmout or other agreements under which the
Company acquires or may acquire its mineral interest in a Designated Well. In
the event the interest of the oil, gas and minerals owned by the Company is or
becomes reduced, the Net Profits shall be proportionately reduced to the
proportion thereof, which the working interest owned by the Company in said
Designated Well bears to the entire working interest for said Designated Well.

      2.11 "NOTICE OF BONUS" means the notice that will be issued to the Trust,
substantially in the form attached hereto as EXHIBIT "A".

      2.12 "PLAN" means this The Meridian Resource Corporation TMR Employees
Trust Well Bonus Plan, as amended from time to time.

                                 ARTICLE III.
                                ADMINISTRATION

      3.1 COMPOSITION AND INDEMNITY OF THE COMPENSATION COMMITTEE. The
Compensation Committee shall be composed of those persons, not less than two, as
are appointed by the Board of Directors of the Company, to serve at its
pleasure. The Compensation Committee shall administer and construe this Plan. No
member of the Compensation Committee shall be liable for any act or any
determination made in good faith. The Company shall, to the fullest extent
permitted by law, indemnify and hold each member of the Compensation Committee
harmless from any and all claims, causes of action, damages and expenses
(including reasonable attorneys' fees and expenses) incurred by the member in
connection with or otherwise relating to his service in that capacity.

      3.2 ADMINISTRATION OF PLAN. Construction by the Compensation Committee of
any provision of this Plan shall be final, conclusive and non-appealable. The
Compensation Committee shall determine, in its sole discretion subject to the
provisions of the Plan:

            (a)   the percentage of the Net Profits that will be paid by the
                  Company to each Bonus Pool;

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            (b)   the calculation of the Net Profits;

            (c)   which wells, of the wells the Company drills or acquires or
                  participates in, if any, will be a Designated Well; and

            (d)   the terms and conditions, if any, not inconsistent with the
                  terms of this Plan, that are to be placed upon the award of a
                  Bonus to the Trust or from a Bonus Pool.

      3.3 DELEGATION. The Compensation Committee may, in its discretion,
delegate one of more of its duties to an officer or a committee composed of
officers of the Company, but may not delegate its authority to construe this
Plan or to make the determinations set out in Section 3.2.

      3.4 AWARD OF BONUS. The Compensation Committee will issue to the Trust a
"Notice of Bonus", within fifteen (15) working days after the drilling spud date
of each Designated Well. The Notice of Bonus shall set out the determination of
the Compensation Committee, for such Bonus Pool, regarding the matters set out
in Section 3.2.

                                  ARTICLE IV.
                            CALCULATION OF BONUSES

      4.1 CALCULATION OF BENEFITS BASED UPON BONUS POOL. As soon as
administratively possible after each Bonus Date, the Compensation Committee
shall calculate the dollar amount of the Bonus to be paid to the Trust in each
Bonus Pool.

      4.2 CALCULATION OF BONUS POOL BASED UPON DISPOSITION OF DESIGNATED WELLS
FOR A BONUS POOL. The Company shall always be entitled to, at any time, dispose
of any and all interests it may hold with respect to any or all Designated
Wells. The time, price, terms and conditions of such disposal will be as the
Company may determine. When a Designated Well is sold or otherwise disposed of,
the amount to be paid to the Bonus Pool shall be a percentage of the net
proceeds received by the Company from any such sale or disposition (as
determined by the Company), minus a percentage of the costs incurred by the
Company in such sale or
disposition (as determined by the Company) and all taxes, which may be assessed
against the Designated Well, because of the sale or disposition, other than
income taxes payable by the Company for its share of said proceeds, if any.

      4.3 CALCULATION OF BONUS UPON LIQUIDATION OF COMPANY. The existence of
outstanding Bonus awards will not affect in any way the right or power of the
Company to make or authorize any or all adjustments or recapitalization or other
changes in the Company's capital structure or its business. Should the Company
elect to liquidate or to enter into any transaction in which it is not the
surviving company ("a Transaction"), unless the surviving or successor company
has formally adopted this Plan and agreed to continue it, in lieu of any Bonus
otherwise payable or to become payable at any time in the future under the Plan,
each Bonus Pool shall be entitled to a payment of an amount equal to the
aggregate present value of the estimated future Net Profits, which may be
expected to be payable by the Company to each Bonus Pool. Calculation of those
estimated future Net Profits shall be determined by the Company, in its sole
discretion, using the Company's latest available external engineering estimate
or the internal estimate if no external estimate exits, of proven recoverable
reserves, annual production rates, revenues, production costs, value's
determined 

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(as a part of a Transaction) for any well or any other factors deemed relevant.
The annual values shall then be discounted to a present value as of the date of
payment at the rate of fifteen percent (15%) per annum. Payment of this
estimated amount will unconditionally relieve, discharge and acquit the Company
of any further obligation to pay any additional amounts to any Bonus Pool, or
the Trust under this Plan. The Compensation Committee shall then pay to the
Trust the Bonus from each Bonus Pool, as calculated pursuant to the Plan.

      4.4 COMPANY'S RIGHT TO SUSPEND, SHUT-IN OR ABANDON ANY DESIGNATED WELL
WITHIN A BONUS POOL. The Company retains the unconditional right at any time, in
its sole discretion, to suspend production from, shut-in or abandon any
Designated Well, which may be included in any Bonus Pool.

                                  ARTICLE V.
                               PAYMENT OF BONUS

      5.1 TIME AND METHOD OF PAYMENT. The Trust shall be entitled to receive
payment of the Bonus as soon as administratively feasible, but in no event,
later than sixty (60) days following any Bonus Date. Each Bonus shall be paid in
cash and/or common stock of the Company, as determined in the sole discretion of
the Compensation Committee. It is contemplated that up to seventy-two percent
(72%) of any payment of a Bonus may be made in the publicly traded stock of the
Company. No interest shall be paid or payable on any Bonus awarded under the
Plan. The Company shall be entitled to deduct from any Bonus paid to the Trust,
the sums required by federal, state or local law to be withheld with respect to
the payment of such Bonus. The Company shall not be required to make any payment
until the appropriate withholding is provided for.

      5.2 LENGTH OF PERIOD PARTICIPANT WILL RECEIVE BENEFIT. The Trust's right
to receive a Bonus from a given Bonus Pool shall continue, for as long as each
Bonus Pool continues, pursuant to Section 2.4, unless the Trust forfeits its
rights under this Plan. In the event of
termination or dissolution of the Trust, the Company shall suspense payments
until the Company has received documents, satisfactory to Company's counsel,
evidencing to whom future payments should be made.


                                  ARTICLE VI.
                             LIMITATION OF RIGHTS

      Nothing in this Plan shall be construed:

            (a)   to give any beneficiary of the Trust or the Trust any right to
                  be awarded a Bonus other than in the sole discretion of the
                  Compensation Committee;

            (b)   to limit in any way the right of the Company to terminate the
                  Trust or any beneficiary's employment with the Company at any
                  time;

            (c)   to evidence any agreement or understanding, express or
                  implied, that the Company will employ any beneficiary of the
                  Trust in any particular capacity or for any particular
                  remuneration;

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            (d)   to give the Trust or any beneficiary of the Trust any right to
                  challenge, change or overturn any decision of the Compensation
                  Committee, as such decision may be made in the Compensation
                  Committee's sole discretion; or


            (e)   to require or obligate the Company to conduct any drilling,
                  completion or producing operations regarding any Designated
                  Well.

                                 ARTICLE VII.
                            ALIENATION OF BENEFITS

      No benefit provided by this Plan shall be transferable by the Trust,
except as provided in this Plan. No right or benefit under this Plan shall be
subject to anticipation, alienation, sale, assignment, pledge, encumbrance or
charge. Any attempt to transfer, anticipate, alienate, sell, assign, pledge,
encumber or charge any right or benefit under this Plan shall be void. No right
or benefit under this Plan shall, in any manner, be liable for or subject to any
debts, contracts, liabilities or torts of the person entitled to the right or
benefit. If the Trust becomes bankrupt or attempts to transfer, anticipate,
alienate, assign, pledge, sell, encumber or charge any right or benefit under
this Plan, then the right or benefit shall, in the sole discretion of the
Compensation Committee, cease.

                                 ARTICLE VIII.
                       AMENDMENT AND TERMINATION OF PLAN

      8.1 AMEND OR TERMINATE AT ANY TIME. The Board of Directors of the Company
may, in its sole discretion, amend or terminate this Plan at any time, subject
to Section 8.2 hereof.

      8.2 NO RETROACTIVE EFFECT UPON AWARDED BONUSES. Any amendment or
termination of this Plan will not affect the rights of the Trust to a Bonus,
which has already been awarded under this Plan prior to the time of the
amendment or the termination.

      8.3 AUTOMATIC TERMINATION. If at any time the appropriate governmental
unit determines that the Plan is not a bonus program, but instead a pension or
welfare benefit plan within the meaning of the applicable provisions of the
Employee Retirement Income Security Act of 1974 or similar statute, rule or
order, this Plan shall automatically terminate as of the date the Company
receives notice of that determination.

                                  ARTICLE IX.
                  RELIANCE UPON GENERAL CREDIT OF THE COMPANY

      It is specifically recognized that this Plan is only a general corporate
commitment and that the Trust must rely upon the general credit of the Company
for the fulfillment of its obligations under the Plan. Though the Company may
hold a Designated Well, which has been designated for a given Bonus Pool,
neither the Plan nor the Bonus Pool creates any claim, lien, encumbrance, right,
title or other interest of any kind whatsoever in the Trust in any well,
property or portion of a property containing such well or in the Net Profits
derived from it. The designation of a well is only a part of the procedure used
in calculating a Bonus due the Trust under the Plan and provides no legal
entitlement to those specific assets. No specific assets of the Company have
been set aside or pledged in any way for the performance of the Company's duties
under this Plan nor will any future assets be pledged or set aside in any manner
to assure the performance of the Company under this 

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Plan. However, the Company may, but is not required to create a rabbi trust in
connection with this Plan, but only if it has received a ruling from the
Internal Revenue Service that the creation of that trust does not cause this
Plan to be "funded" as that term is generally used in the Employee Retirement
Income Security Act. Thus, the rights of the Trust and any persons claiming
under the Trust shall be those solely of unsecured creditors of the Company.

                                  ARTICLE X.
                                 GOVERNING LAW

      This Plan shall be governed by the laws of the State of Texas. All of the
Parties irrevocably consents to the exclusive jurisdiction of any Texas or
United States Federal Court sitting in Harris County over any action or
proceeding arising out of this Plan. All Parties waive any objections to venue
in Texas and any objection to any action or proceeding in Texas on the basis of
forum non conveniens.

                                  ARTICLE XI.
                                CONFIDENTIALITY

      11.1 Any information, data or knowledge which is related directly or
indirectly to, any Designated Well, the Bonus Pool, any property or portion of
any property containing any Designated Well, or any geological prospect
containing a Designated Well, is information the
Company considers secret, proprietary and confidential (the "Confidential
Information"). By acceptance of a Bonus, the Trust agrees and any beneficiary of
the Trust that for as long as the Trust is receiving a Bonus and for a period of
twelve (12) months after receipt of the final Bonus, the Trust and any
beneficiary of the Trust will keep all Confidential Information confidential and
will not (i) disclose or permit the disclosure of any Confidential Information;
and/or (ii) solicit to employ or attempt to employ or divert any employee of the
Company or any of its affiliates with knowledge of Confidential Information. The
Confidential Information will not include information in the public domain or
generally known by the public. In the event the Trust and any beneficiary of the
Trust breaches this Section 11.1 the Company, in addition to any other remedy to
which it may be entitled at law or in equity, shall be entitled to terminate its
obligation to make any further payments of any Bonus and to an injunction or
injunctions (without the posting of any bond) to prevent breaches or threatened
breaches of this Plan and/or to compel specific performance of this Plan and the
Trust will not oppose the gravity of such relief including all costs and
expenses, including attorney's fees.

                                 ARTICLE XII.
                                EFFECTIVE DATE

      This Plan shall become operative and effective on November 5, 1997.

                                 ARTICLE XIII.
                                 MISCELLANEOUS

      13.1 The article headings used in this Plan are inserted for convenience
only and shall be disregarded in construing this Plan.

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      13.2 If any portion of this Plan is rendered invalid by a court of proper
jurisdiction, the balance of this Plan shall continue in full force and effect.

      13.3 To be effective, any notice, request or other communication permitted
or required to be given by either party hereunder shall be given in writing and
may be effected by placing the same in the United States mail, certified with
return receipt requested, postage prepaid, by delivery by courier service, by
prepaid telegram or by facsimile transmission, and shall be deemed given the
date and hour three (3) days following the date and hour at which the same is
deposited with a clerk of the United States Postal Service, or when so delivered
by courier service or personally delivered or by prepaid telegram filed with a
telegraph company or on completion and confirmation of a facsimile transmission,
addressed to the respective party to be notified.

      13.4 This Plan shall be binding upon the parties hereto and their
respective heirs, executors and successors.

      13.5 Neither the adoption and existence of the Plan, nor any payment,
contribution or other participation by the Company in the Plan, shall be
considered a contract between the Trust or any Trust beneficiary and the
Company, or consideration for, or inducement with respect to, any Trust
beneficiary's continued employment by the Company.

      13.6 The Trust represents to the Company and agrees that it: (i) was
specifically advised to and fully understands its rights to discuss all aspects
of this Plan with an attorney, (ii) has to the extent it desires, availed itself
of these rights, (iii) has carefully read and fully understands the provisions
of the Plan, and (iv) is responsible for any federal and/or state income or
other tax liability that may result as a consequence of the receipt of any
Bonus.

      13.7 This Plan sets forth the entire agreement between the Company and the
Trust and fully supersedes all prior written and oral agreements, understandings
and representations between the parties including but not limited to those
concerning the Trust rights to receive any monies from the Company from or in
respect of any Designated Well or from or in respect of any Company prospect.

THE MERIDIAN RESOURCE CORPORATION



By:/s/JOSEPH A. REEVES, JR.
      JOSEPH A. REEVES, JR., Chairman

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                                  EXHIBIT "A"


                                NOTICE OF BONUS



Name of Bonus Pool:               ________________________________________(YEAR)


Designated Well:                  _____________________________________________


Bonus Percentage:                 _____________________________________________


Date of Bonus:                    _____________________________________________



COMPENSATION COMMITTEE



By: _________________________________
    JOSEPH A. REEVES, JR., Director



By: _________________________________
    MICHAEL J. MAYELL, Director