COMPENSATION AGREEMENT

         THIS AGREEMENT (this "AGREEMENT"),  dated as of the 25th day of January
1999,  by  and  between  Triad  Compressor,  Inc.,  a  Nevada  corporation  (the
"COMPANY"), and Alan D. Propp ("EXECUTIVE").

         WHEREAS,  the Company believes that Executive has unique experience and
skills that would  significantly  benefit the Company in the  management  of the
affairs of the Company; and

         WHEREAS,   the  Company   acknowledges  and  recognizes  the  value  of
Executive's  services and deems it necessary and desirable to retain Executive's
services for a period of three years; and

         WHEREAS,  both Executive and the Company desire to embody the terms and
conditions  of  Executive's  compensation  in a  written  agreement  which  will
supersede all prior agreements of compensation, whether written or oral.

         NOW,  THEREFORE,  in consideration of the premises and of the covenants
and agreements herein contained, the parties hereto agree as follows:

         1.  EMPLOYMENT  TERM.  The Company  agrees to, and does hereby  employ
Executive to serve as Vice President and Secretary of the Company and to perform
the  services as  hereinafter  set forth for a period of three years  commencing
January 25, 1999 and ending December 31, 2001.

         2.  SERVICES  OF  EXECUTIVE.  Executive  agrees to  devote  such of his
business time (exclusive of four weeks of vacation in each calendar year) to the
business and affairs of the Company,  and to use his best efforts to promote the
interests of the Company, and to carry out such duties and perform such services
as may be delegated to Executive  from time to time by the board of directors of
the Company. The Company acknowledges and agrees that Executive will continue to
serve as an officer  and  director  of any  subsidiary  of the  Company  and its
affiliates,  and nothing in this Agreement  shall prohibit  Executive from being
directly or indirectly engaged in the oil and gas business or any other business
in any  capacity  with any  other  corporation,  partnership,  venture  or other
entity.

         3.       COMPENSATION.
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     (a)  In  payment  for the  services  set forth in  paragraph  2 above,  the
          Company  shall pay to  Executive  during the term  hereof at a rate of
          $400  per day  during  the  term of this  Agreement.  Executive  shall
          present reports, at least quarterly, detailing the work done on behalf
          of the company to which he is entitled  compensation.  Executive shall
          also be entitled to participate in any Company plan for the benefit of
          any or all of its employees,  including any deferred compensation plan
          (such as pension,  profit-sharing  or thrift plan), or group hospital,
          disability or life  insurance  plan,  in accordance  with the terms of
          such plan.

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<PAGE>


     (b)  Rate of compensation of Executive may be increased  annually each year
          during the term of this Agreement by an amount determined by the board
          of directors of the Company.

     (c)  In the event that  Compensation  is not  received  by  Executive  when
          payable  pursuant to this  Agreement,  Executive may elect at any time
          after  January 1, 2000 to accept shares of common stock of the Company
          in payment of accrued  unpaid Base Salary at a rate of $0.25 per share
          for 1999  Compensation.  For the years 2000 and 2001, the Compensation
          if paid in  common  stock,  shall be  converted  at 50% of the  volume
          weighted  monthly average trading value of the Company's common stock.
          The  number  of  shares of Common  Stock of the  Company  issuable  to
          Executive  hereunder  as well as the  amount of  accrued  unpaid  Base
          Salary to be paid by  issuance  of such  shares  shall be  subject  to
          adjustment   to   reflect   any   stock   split,    stock    dividend,
          recapitalization, merger consolidation, reorganization, combination or
          exchange of shares or other similar event. In no event shall Executive
          be  obligated  to  accept  shares of common  stock of the  Company  in
          payment of Base Salary.

         4.  EXPENSES.  The Company will  arrange for the payment of  reasonable
expenses  incurred by  Executive in  furtherance  of or in  connection  with the
business of the Company,  including,  but not limited to, all traveling expenses
and all entertainment expenses (whether incurred at Executive's residence, while
traveling, or otherwise). If any such expenses are paid in the first instance by
Executive,  the Company will arrange for his reimbursement therefor. The Company
recognizes that, in the performance of his duties,  Executive may be required to
entertain  various persons and  representatives  of organizations  with whom the
Company  has or would like to have  business  relationships.  The  Company  will
arrange for the reimbursement of Executive upon presentation of expense vouchers
for any  reasonable  such expenses  which are adaptable to the usual  accounting
procedures established by the Company.

         5.   PHYSICAL  EXAM.  Executive  agrees to take a physical  examination
at the Company's expense each year during the term of this Agreement.

         6.   TERMINATION  OF  EMPLOYMENT.   Executive's  employment   with  the
Company may be terminated prior to the expiration of the term hereof as follows:

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<PAGE>

          (a)  The board of directors of the Company may  terminate  Executive's
               employment if (i) the board of directors of the Company  notifies
               Executive in writing that  Executive is in breach or violation of
               this  Agreement,  such written  notice to set forth in detail the
               exact  nature  of  such  breach  or  violation,   (ii)  Executive
               willfully  fails  or  refuses  to  take  such  actions  as may be
               reasonably  required by the board of  directors of the Company to
               cure any breach or violation by Executive of this  Agreement  and
               (iii)  such  failure  or  refusal  shall  continue  for or is not
               corrected  within  30  days  after  warning  from  the  board  of
               directors of the Company in such regard is given to Executive. In
               addition,  the board of  directors  of the  Company  may for good
               cause  terminate  Executive's  employment  under  this  Agreement
               without advance notice.  Termination  shall not affect any of the
               Company's  other  rights and  remedies.  For the  purpose of this
               Agreement, good cause shall be deemed to mean only the following:

               (i)  should  Executive  for reasons  other than illness or injury
                    absent  himself  from his duties  without the consent of the
                    board of directors for more than 20 consecutive days;

               (ii) should  Executive  be  convicted  of a crime  punishable  by
                    imprisonment;

               (iii)should   Executive   commit  gross   negligence  or  willful
                    misconduct in the  performance of his duties  hereunder,  or
                    otherwise  fail to comply with the terms and  conditions  of
                    this Agreement; or

               (iv) should  Executive  willfully  engage in  misconduct  that is
                    materially injurious to the Company, or any affiliate of the
                    Company, monetarily or otherwise.

          (b)  Executive's  employment  with the Company  shall  terminate  upon
               Executive's   death  and   Executive's   estate   or   designated
               beneficiaries  shall  be  entitled  to  the  amount  as  provided
               pursuant to paragraph 6 above and any insurance benefits provided
               pursuant to paragraph 7 above.

          (c)  Executive  may elect to  terminate  this  Agreement  upon 90 days
               prior written notice  thereof to the board of directors.  For the
               purpose  of this  Agreement,  "constructive  termination"  by the
               Company shall be deemed to mean the  resignation  by Executive of
               his  position  with the Company as a result of  Executive's  good
               faith  belief  that the board of  directors  of the  Company  has
               acted, or proposes to act contrary to Executive's objection, in a
               manner  that  (i)  is  illegal,  (ii)  constitutes  a  breach  of
               fiduciary  duty or (iii) is  contrary to advice of counsel to the
               Company.  A  constructive  termination  shall be  deemed  to be a
               termination  by the  Company of  Executive's  employment  without
               cause.

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<PAGE>

          (d)  In the event that the board of directors elects to terminate this
               Agreement  pursuant to paragraph  10(a) above,  the Company shall
               have no further obligation to compensate Executive or provide any
               benefits hereunder  effective upon the date of termination unless
               Executive shall in good faith dispute such termination and submit
               such dispute to arbitration pursuant to paragraph (e) below.

          (e)  In the  event  that  Executive  contests  any  termination  under
               paragraph 10(a) above by written notice to the board of directors
               setting forth in detail Executive's reasons for objection to such
               termination,  such  matter  may  be  submitted  by  Executive  to
               arbitration by an arbitration panel comprised of three members of
               the American Association of Arbitrators,  one of whom is selected
               by  Executive,  one of whom is selected by the board of directors
               and one of whom is  selected by the  arbitrators  selected by the
               Executive and the board of directors. The validity of Executive's
               termination  shall be decided  by a majority  of the votes of the
               arbitrators  and their written  decision shall be  nonappealable.
               Any such  arbitration  shall take place in Dallas,  Texas.  Costs
               will be borne by the party against whom the decision is rendered.

         7. DISCLOSURE OF INFORMATION.  Executive  hereby  acknowledges  that he
will have access to certain trade secrets and  confidential  information  of the
Company and of affiliates of the Company and that such  information  constitutes
valuable,  special  and unique  property  of the  Company  and such  affiliates.
Executive  shall  not,  during  or after the term of his  employment  hereunder,
disclose any such trade  secrets or  confidential  information  to any person or
entity  for any  reason or purpose  whatsoever  except to the  extent  that such
information  becomes  publicly  disclosed (other than as a result of a breach of
this Agreement by Executive) or to the extent required by law. Executive further
agrees that unless  otherwise  agreed by the board of  directors of the Company,
any intellectual property developed by Executive in the course of his employment
with the Company  shall be developed on behalf of, and for the ownership of, the
Company.

         8. ACTIONS OF BOARD; AFFILIATES. For the purpose of this Agreement, all
actions or consents  required or  permitted to be taken or given by the board of
directors of the Company with respect to this Agreement  shall be to refer to an
action or  consent  approved  by a  majority  of the board of  directors  of the
Company  other than  Executive  and including at least two directors who are not
employees of the Company.

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<PAGE>
         9. CONSOLIDATION OR MERGER. Other than a transaction with affiliates of
the Company not resulting in a change of control of the Company, in the event of
any  consolidation  or merger of the Company into or with  another  corporation,
partnership  or other  entity,  or the sale of all or  substantially  all of the
assets of the Company during the term of this Agreement or any renewal  thereof,
Executive may, in his sole and absolute discretion,  elect to (i) terminate this
Agreement  without fault, or (ii) continue his employment  pursuant to the terms
hereof in which case such corporation,  partnership or other entity shall assume
this  Agreement and become  obligated to perform all of the terms and conditions
hereof,  and Executive's  obligations  hereunder shall continue in favor of such
corporation, partnership or other entity.

         10.  NOTICE.  Any  consent,  notice,  warning  or  other  communication
("Notice") to be given hereunder shall be in writing and shall be deemed to have
been properly given when mailed by first class U.S.  Mail,  when sent by prepaid
telegram,  or when  delivered in person,  addressed or delivered in each case to
the address set forth across from each party's signature below, or to such other
address  as either of the  parties  shall  designate  to the other in the manner
provided for giving notice.

         11. NATURE OF AGREEMENT. No right, title, interest or benefit hereunder
shall  ever be liable  for or charged  with any of the torts or  obligations  of
Executive or of any person  claiming under  Executive,  or subject to seizure by
any  creditor of  Executive  or any person  claiming  under  Executive.  Neither
Executive  nor any  person  claiming  under  Executive  shall  have the power to
anticipate or dispose of any right, title,  interest or benefit hereunder in any
manner until the same shall have been actually distributed to him free and clear
of the terms of this Agreement.

         12.  BINDING  EFFECT.  Subject to the provisions of paragraph 13 above,
this  Agreement  shall be binding upon and inure to the benefit of any successor
to the Company and all persons lawfully claiming under Executive. This Agreement
cannot be assigned by Executive.

         13.  ENTIRE  AGREEMENT.  The parties  hereto  agree that this  document
contains the entire understanding and agreement between them with respect to the
matters set forth herein and cannot be amended,  modified or supplemented in any
respect  except by an  agreement  in writing  signed by the party  against  whom
enforcement of any amendment, modification or supplement is sought.

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<PAGE>

         14. WAIVER.  The failure of either party to insist,  in any one or more
instances,  upon performance of any of the terms or conditions of this Agreement
shall not be  construed  as a waiver or a  relinquishment  of any right  granted
hereunder or of the future performance of any such term,  covenant or condition,
but the  obligations of either party with respect thereto shall continue in full
force and effect.

         IN WITNESS  WHEREOF,  the Company has caused this  Agreement to be duly
executed by its executive  officer duly  authorized,  and Executive has executed
this Agreement, all effective as of the date first above written.

Address:                                          TRIAD COMPRESSOR, INC.

                                                  By:__________________________
                                                  Name:________________________
------------------------------------              Title:_______________________
------------------------------------


Address:                                          EXECUTIVE


------------------------------------              -----------------------------
------------------------------------              Alan D. Propp










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