I have received an offer to lease my oil and gas mineral rights.
In my lease offer it says "This is a paid up lease and subject to the other provisions herein contained, this lease shall be for a term of (3) years from this date (called "primary term") and as long thereafter as oil, gas or other mineral is produced from said land or land with which said land is pooled hereunder.
Does this mean that if the well is producing the oil company gets to continue the lease even after the original 3) years have expired without renewing and/or paying for another option to lease?
Yes. The description is "held by production". You need to make sure that non-producing parts of the lease are not held. There should be a clause (sometimes called a Pugh clause) that severs the non-producing portions (horizontally AND vertically) from the part that is producing.
That's always how it works, aka standard protocol. They lease your land, if they hit oil, the lease becomes "held by production". However, acreage and/or depths may be released depending on what clauses you include. Message me and I'll explain further and answer any other questions.
Sharon please seek advice before signing you lease. There is language in a standard lease that could decrease your royalty checks if you’re not careful. Robin