The are two Lord Souls and two Bequeathed Lord Soul Shards to be obtained. Once you have all four you can unlocked the final area by placing them into the Lord Vessel.
This is the only purpose and use of these Souls.
Seath the Scaleless. Be sure to wear a Rare Ring of Sacrifice the first time you encouter him in the Duke's Archives. You can not win this fight, so don't even try.
Place all four in the Lord Vessel to unlock the final area. The Lord Souls appear under the Keys section of the inventory.