PROTECTION COVENANT

PROTECTION COVENANT

protection covenant. Oil & gas. The implied promise in an oil-and-gas lease that the lessee will protect the property against the loss of oil and gas by drainage from the producing reservoir by drilling one or more offsetting wells. ? The covenant applies only if a reasonably prudent operator would drill the additional wells. ¡ª Also termed covenant to protect against drainage. See REASONABLY PRUDENT-OPERATOR STANDARD.
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Carl, Chinese legal translator, specializes in translating legal documents pertaining to complex business disputes.