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CONSULTING ARRANGEMENT

THIS AGREEMENTis dated effective as of the
17th day of July, 2008.

BETWEEN:

TRANS-ORIENT PETROLEUM LTD., a
company incorporated under the laws of British Columbia and having an
office at 999 Canada Place, World Trade Centre, Suite 404, Vancouver,
British Columbia V7C 3E2

(Trans-Orient)

AND:

TAG OIL LTD., a company
incorporated under the laws of British Columbia and having an office at
Suite 1407, 1050 Burrard Street, Vancouver, British Columbia V6Z 2S3

(TAG)

WHEREAS:

(A)          
Trans-Orient has a contractual agreement with Drew Cadenhead dated January 1,
2008, under which Mr. Cadenhead provides consulting and advisory services on
business development matters to Trans-Orient in an amount equal to CDN$240,000
per year, which does not restrict Mr. Cadenhead from entering into an
arrangement with TAG to allow for 50% of Mr. Cadenheads time to be allocated to
TAG;

(B)          
Trans-Orient and TAG have formally acknowledged in a letter dated May 26, 2008,
which is attached as Exhibit A hereto, that Mr. Cadenhead has been providing
consulting and advisory services on business development matters to TAG
(Consulting Services) pursuant to a verbal agreement under which TAG
compensates Mr. Cadenhead for 50% of his contracted monthly compensation with
Trans-Orient in the amount of CDN$10,000 per month since January 1, 2008;
and

(C)          
Trans-Orient wishes to allow Mr. Cadenhead to continue to provide Consulting
Services to TAG on the terms and conditions contained herein;

WITNESSETHthat the parties mutually agree as
follows:

Term and Compensation for Consulting Services

1.1                    
TAG will compensate Mr. Cadenhead in an amount equal to CDN$10,000 per month
(the Fee) on an ongoing basis that is effective January 1, 2008, subject to
Section 1.2.

Termination of Compensation for Consulting
Services

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1.2                    
TAG may approve the termination of the Fee for the Consulting Services at any
time for any cause or reason, or without any cause or reason, and TAG will give
Mr. Cadenhead three (3) months prior written notice of such termination.

1.3                    
In the event of the termination of the Fee for the Consulting Services by TAG,
Mr. Cadenhead will be entitled to payment for the performance of all Consulting
Services provided under this Agreement up to the date of the expiry of the three
(3) month prior written notice of such termination.

Entire Agreement

1.4                    
This Agreement constitutes the entire agreement between the parties and
supersedes and replaces all prior negotiations, written or oral understandings
and agreements made between the parties with respect to compensation.

Counterpart

1.5                    
This Agreement and any other writing delivered pursuant to this Agreement may be
executed in any number of counterparts with the same effect as if all parties to
this Agreement or such other writing had signed the same document and all
counterparts will be construed together and will constitute one and the same
instrument.

IN WITNESS WHEREOF the parties have executed this
Agreement on the day and year first above written.

|TRANS-ORIENT PETROLEUM LTD.      |  |                   
|-------------------------------- |  | ------------------
|                                 |  |                   
|                                 |  | /s/Dan
      Brown
|/s/Garth Johnson                 |  | Witness Signature 
|Garth Johnson, President and CEO |  |                   
|                                 |  |                   
|                                 |  | Name of Witness   
|                                 |  |                   
|TAG OIL LTD.                     |  |                   
|                                 |  | /s/Peter Loretto  
|/s/Giuseppe (Pino)
      Perone  |  | Witness Signature 
|Giuseppe (Pino) Perone, Director |  |                   
|                                 |  |                   
|                                 |  | Name of Witness   

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Exhibit A

ACKNOWLEDGEMENT

|To: | Trans-Orient Petroleum, Ltd.
      (the Company)
|--- | --------------------------------------------------
|    | 999 Canada Place                                  
|    | World Trade Center, Suite 404                     
|    | Vancouver, B.C., V6C 3E2                          

The purpose of this document is to constitute an acknowledgment
(the Acknowledgement) made effective this 26th day of May, 2008, by
TAG Oil Ltd. (TAG) to the Company.

TAG hereby acknowledges that Drew Cadenhead has a contractual
arrangement with the Company for CDN$240,000 per year whereby Mr. Cadenhead
provides consulting and advisory services on business development matters to the
Company under a consulting agreement dated January 1, 2008 (the Consulting
Agreement), and that the Consulting Agreement does not restrict Mr. Cadenhead
from entering into an arrangement with TAG to allow for 50% of Mr. Cadenheads
time to be allocated to TAG, under which TAG will compensate Mr. Cadenhead for
50% of his contracted monthly compensation with the Company in the amount of
CDN$10,000 per month.

TAG and the Company acknowledge that Mr. Cadenhead has been
consulting for TAG since January 2008 pursuant to a verbal agreement and has
been compensated by TAG as described above.

This Acknowledgement, made in the Province of British Columbia,
will be governed by and construed in accordance with the laws of the Province of
British Columbia and the laws of Canada applicable therein.

This Acknowledgement has been executed by TAG as of the day and
year first above written.

Sincerely,

TAG OIL LTD.

/s/Garth Johnson Garth Johnson, CEO

Accepted and agreed to this 26th day of May, 2008.

BY:    TRANS-ORIENT PETROLEUM LTD.

Per:   /s/Michael
Hart
                      
Authorized Signatory



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