Oct 27, 2007 - 10:17:01 CDT
Finally, the U.S. House of Representatives has passed meaningful energy legislation.We applaud their foresight and applaud its passage. A longstanding problem has finally been addressed at the federal level and now we need the U.S. Senate, specifically Sens. Kent Conrad and Byron Dorgan, to see that these provisions are included in the bill that will go to the president.
The Energy Policy Reform and Revitalization Act among other things will provide protections for surface owners in North Dakota and nationwide who do not own their minerals, known as a "split estate."
Industry speaks easily of private property rights for mineral owners and the years that it has taken to define such laws, but basically denies the owner of the surface any rights.
My family and I are split estate landowners in the Little Missouri National Grasslands. Our ranch is one of many that is in a split estate situation. Our family has farmed and ranched since the early 1900s, when my grandparents on both sides homesteaded here. We have had oil and gas development on our farm/ranch since exploration and development began in North Dakota in the mid-1950s. There is not a time that I can remember not having to deal with the oil and gas industry.
Frequently, surface owners have no idea who owns the minerals under their lands. That owner, especially in the Little Missouri National Grasslands, is often the federal government. This legislation will allow split estate surface owners to be notified when the minerals beneath them, if owned federally, are about to be leased. If they are permitted to have a voice in the process, both sides win.
I know from experience that surface owners need to have a say in each step of the process from lease sale stage to the point in time when the rigs and tanks are gone and reclamation work is finished. After all, the land belongs to the surface owner and it is going to be there long after the oil is gone.
This act also will require that any water that is damaged or disrupted be replaced. This is particularly important in western North Dakota, where oil companies are fast becoming corporate owners of water for use in the production phase of oil production. Water management plans are necessary to protect western North Dakota's valuable and scarce water supplies.
This act requires a change in the reclamation bonding for the surface land. The current federal bonding amounts were set under 1960s rules, and though there has been at least one attempt to update the regulation, it has never been accomplished. If we cannot change the way that the government bonds for oil and gas wells, which currently is grossly inadequate, hundreds of thousands of acres disturbed by oil and gas development reclamation may take place at the expense of the taxpayer instead of the industry.
North Dakota took a big step in changing the way that wells are bonded during the 2007 Legislature. Now, for any well that sits idle for a year or more, a common occurrence in North Dakota, the operator will be required to post a separate bond that is equal to the actual costs of plugging and reclamation. Those costs have nearly doubled in recent years and now, depending on the location, can be over $50,000 per well. Now we need to make significant change at the federal level.
In 2007 the Legislature finally passed a law that surface owners who reside close to a proposed well site be notified. The oil and gas industry as usual fought against this legislation but now will hold it up as an example of their good stewardship. Mineral owners and industry have had years and years of protections. It is time for those who live on that land to have protections for their lands, water and families.
The oil and gas industry is attempting to misrepresent the nature of this act, suggesting that the reforms will cause oil prices to rise. In reality, oil prices respond to global market forces of supply and demand, not to whether operators on private and public lands are required to pay a small administrative fee to obtain drilling permits or post bonds that usually are only 1 to 2 percent actual face value of the bond to repair the damage done by development, or make sure private property owners are treated fairly.
This act will not limit energy development on public lands. More than 42,000,000 acres of federal lands are under lease in the West, and a record number of drilling permits have been issued on them. No provisions in this bill put any federal lands off limits or disrupt oil and gas development in the region.
Enactment of these important provisions of the Energy Policy Reform and Revitalization Act will help ensure that oil and gas development takes place responsibly, in appropriate places with the proper safeguards, and in a way that balances our need for oil and gas with the need to protect and the rights of property owners. This bill deserves the support of all who value the quality of life in western North Dakota and throughout the West.
North Dakotans should contact Conrad and Dorgan, asking them to support the surface owners of North Dakota who have oil and gas development on their lands. Tell them North Dakotans are struggling for the right to co-exist with the oil and gas industry and this bill can and will level the playing field. There is a process for doing it right, and their support of this legislation in the Senate can and will make a difference.
(Nelson is on the Dakota Resource Council Oil and Gas Task Force. -- Editor)
ck wrote on Oct 27, 2007 10:50 PM:
Dakotan wrote on Oct 27, 2007 8:43 PM:
CK wrote on Oct 27, 2007 11:24 AM:
Dakotan wrote on Oct 27, 2007 10:18 AM:
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