Mineral Lease
Gridlync land and infrastructure glossary.
A mineral lease grants the right to explore for and produce minerals, such as oil, gas, or other resources, from a property, typically in exchange for a bonus, rentals, and royalties. The surface and mineral estates may be owned separately. Such leases usually include a primary term during which drilling must begin, a royalty on production often between one-eighth and one-fourth, and delay rentals to hold the lease before production starts. The lease ends if drilling or production does not occur within the agreed period.
Mineral leases sit alongside surface and right-of-way agreements in an operator’s land record. Gridlync keeps the related documents and payments connected.
Example
The Schmidt family leases the minerals under 640 acres to Lone Butte Energy for a $200 per acre bonus, a one-fifth royalty, and a three-year primary term. Lone Butte must spud a well within those three years or the lease lapses.