1. n. [Oil and Gas Business]

A contract between mineral owner, otherwise known as the lessor, and a company or working interest owner, otherwise known as the lessee, in which the lessor grants the lessee the right to explore, drill, and produce oil, gas, and other minerals for a specified primary term and as long thereafter as oil, gas, or other minerals are being produced in paying quantities. This lease gives the lessee a working interest. The oil and gas lease is granted in exchange for royalty payments to the lessor.

See related terms: paid-up lease,  royalty,  term lease,  top lease,  working interest