does a lease run out if there is no production for a certain length of time?
The short/partial answer to this is Yes, usually after 24 consecutive months of non production. The long answer is it depends on the circumstance and your OGL form language. Keep in mind this has to be for 24 CONSECUTIVE months and “paying quantities” is a relative statement. Operators tend to find ways to sell enough product to perpetuate the lease or work the well over in the 24 month time frame. If you believe an operator has “abandoned” a well and you have not received production revenues in 24 consecutive months I would recommend contacting the operator and ask their plans for the well. If necessary you can request a release of oil and gas lease be filed. Below is an example of the language from the form we use and i believe it to be pretty typical (in OK at least).
" 2nd. To pay lessor for gas of whatsoever nature or kind (with all of its constituents) produced and sold or used off the leased premises, or used in the manufacture of products therefrom, of the gross proceeds received for the gas sold, used off the premises, or in the manufacture of products therefrom, but in no event more than of the actual amount received by the lessee, said payments to be made monthly. During any period (whether before or after expiration of the primary term hereof) when gas is not being so sold or used and the well or wells are shut in and there is no current production of oil or operations on said leased premises sufficient to keep this lease in force, lessee shall pay or tender a royalty of three dollars ($3.00) per year per net royalty acre retained hereunder, such payment or tender to be made, on or before the anniversary date of this lease next ensuing after the expiration of ninety (90) days from the date such well is shut in and thereafter on the anniversary date of this lease during the period such well is shut in, to the royalty owners. When such payment or tender is made it will be considered that gas is being produced within the meaning of the entire lease. Nevertheless, Lessee may perpetuate this lease after the primary term by paying shut-in royalties for a period not to exceed 24 consecutive months. This lease shall terminate unless production is resumed in paying quantities before the expiration of this 24-month period."
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It does depend on your lease language but most leases expire for non-production in a much shorter time period than 24 months. The lease usually stipulates what types of operations (i.e. working on wells etc) can perpetuate the lease in the absence of production.