landowner’s royalty

A share of production or revenues provided for the lessor in the royalty clause of the oil-and-gas lease and paid at the well free of any costs of production.

• Traditionally, except in California, the landowner’s royalty has been 1/8 of gross production for oil and 1/8 of the proceeds received from the sale of gas. But today the size is often negotiated.

— Also termed leaseholder royalty.