Extremely tense part of Lorraine's occupation (7)
I believe the answer is:
tenancy
'occupation' is the definition.
(I've seen this before)
'extremely tense part of lorraine's' is the wordplay.
'extremely' means to remove the middle letters (only the extremes of the word are used).
'part of lorraine' becomes 'Nancy' (city in the Lorraine region of France).
'tense' with its middle removed is 'te'.
'te'+'nancy'='TENANCY'
(Other definitions for tenancy that I've seen before include "Tenure" , "Lease (of a house)" , "Temporary occupation of property" , "Let" , "Occupation of rented property" .)