# Habendum Clause: How Long an Oil & Gas Lease Really Lasts
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> The habendum (term) clause of an oil and gas lease sets its duration: a fixed primary term plus a secondary term that continues "as long thereafter as oil or gas is produced." What "produced in paying quantities" means, held-by-production, shut-in and Pugh clauses, and why a lease can hold your minerals for decades.

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**Generated:** 2026-08-16 (heuristic; server-side extraction)

## Answer
The habendum clause — often called the "term clause" — is the provision in an oil and gas lease that fixes how long the lease lasts: a fixed primary term of a stated number of years, followed by a secondary term that continues the lease indefinitely for "as long thereafter as oil or gas is produced" from the leased land. Frequently asked questions What is a habendum clause in an oil and gas lease? It is the term clause that sets how long the lease lasts: a fixed primary term of a set number of years, plus a secondary term continuing the lease "as long thereafter as oil or gas is produced" from the land. It controls when a lease ends or continues — the single most important provision for a mineral owner. What does "held by production" (HBP) mean? Once a well produces before the primary term ends, the habendum clause's secondary term keeps the lease in force for as long as production continues — automatically, with no renewal. A single producing well, even a marginal one, can hold the entire leased tract indefinitely. That is why decades-old leases can still bind minerals today. What does "produced in paying quantities" mean? Courts read "produced" to mean production that yields a profit over the well's operating and marketing costs, judged over a reasonable period. The Texas standard from Clifton v. Koontz (1959) asks whether the well profits over operating expenses and whether a reasonably prudent operator would keep producing it. An unprofitable, marginal well may not hold a lease. Can a single well hold my whole lease? Yes — unless a Pugh clause or retained-acreage clause limits it. The unmodified habendum clause holds the entire leased tract as long as any part of it produces, so one well on a corner can tie up all the acreage. A Pugh clause releases the acreage outside the producing unit after the primary term. Does a shut-in well keep my lease alive? It can, if the lease has a shut-in royalty clause. That clause lets the lessee maintain the lease on a well capable of producing but temporarily shut in — for lack of a pipeline or market — by paying a shut-in royalty in place of production. The clause's exact terms and time limits govern, so the lease language controls. How do I know when my oil and gas lease expires? Read the habendum clause with the savings clauses. If the land is producing in paying quantities, the lease is held by production and continues indefinitely. If the primary term is running with no production or qualifying operations, it can expire at the end of that term. Because "paying quantities" and savings clauses are fact-specific, have a qualified oil and gas attorney confirm your lease's status.

## Page Outline
- The Habendum Clause in an Oil and Gas Lease
  - What the habendum clause does
  - The primary term
  - The secondary term: held by production
  - What "produced in paying quantities" means
  - Savings clauses that keep the lease alive without steady production
  - The temporary-cessation-of-production doctrine
  - Pugh clauses and retained-acreage: limiting how much the habendum holds
  - What the habendum clause means for mineral owners
  - Related reading
  - Frequently asked questions
  - Ready to Sell Your Mineral Rights?

## Related Pages
- [Oil & Gas Lease Terms Explained](https://www.buckheadenergy.com/oil-gas-lease-terms)
- [How to Respond to a Lease Offer](https://www.buckheadenergy.com/resources/first-oil-gas-lease-offer-how-to-respond)
- [The Shut-In Clause](https://www.buckheadenergy.com/shut-in-clause)
- [Oil & Gas Encyclopedia — all terms](https://www.buckheadenergy.com/learn)

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