A mining contract is a way to allow the seller of the contract to rent his mining power to the buyer of the contract.

This means you can buy or sell mining power (or the obligation to pay bitcoins at the same rate as mining does).

We can't force sellers to mine bitcoins, but we can force them to pay the equivalent amount of bitcoins that mining would produce.

It is wise for sellers to have mining power to back up their contract, since this allows them to hedge against changes in network difficulty.

 

For example, buying a 1GH/s mining contract guarantees you will be paid the the same amount of bitcoins as a 1GH/s mining rig would produce (if that rig had no downtime, no stales, and no variance).
https://ferroh.com/mining/intro this is the source of the article