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nonparticipating royalty

1. n. [Oil and Gas Business]

A percentage share of production, or the value derived from production, which is free of the costs of drilling and producing, created by the lessor or royalty owner and borne by the lessor or royalty owner out of the lessor royalty. This royalty is paid to nonparticipating interest holders who do not share or participate in bonus or rentals, or a right to explore, or a right to execute oil and gas leases.

See: lessor royaltyoil and gas leaseroyalty