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Three Affiliated Tribes see future prosperity in oil

May 21, 2008 - 04:06:11 CDT

By LAUREN DONOVAN
Bismarck Tribune

NEW TOWN - The chairman of the Three Affiliated Tribes ducked over to a side table to sign $300,000 worth of oil and gas leases Tuesday, during an energy conference on the Fort Berthold Indian Reservation.

From where he sat, Chairman Marcus Wells Jr. could hear the bells and dings of hundreds of slot machines in the adjacent 4 Bears Casino.

The three-in-a-row lining up now - leases, active companies and possibly oil from the Bakken formation - could be just as lucky as any casino for the people on the reservation.

The checks represent a small share of the 200,000 mineral acres the tribe owns on the reservation where most of 900,000 mineral acres are allotted to tribal members under trust, or to private individuals on what are called "fee" acres inside the reservation boundary.

Wells sees a new day of prosperity, employment and independence for tribal members and a new source of revenue for health care, roads and other needs.

He sees a day where tribal members have enough money to qualify for home mortgages, make down payments, or even buy housing outright.

Wells said most of the reservation wasn't explored for oil during the last boom because federal law required 100 percent of mineral owners sign leases. The law changed to 51 percent in 1997, making lease deals far more doable.

As of Tuesday, nearly half of the tribally owned and allotted acres were leased, and likely some similar portion of the private fee acres, though that number isn't tracked by tribal administrators.

Things are moving fast, now, and in January the tribal council created an Energy Department to keep up with it, headed by Fred Fox.

An oil rig almost visible from the casino, not far from Clark's Creek Bay on Lake Sakakawea, represents the first well on the west side of the reservation in nearly 60 years.

It's also the first well on trust mineral acres.

Marathon Oil's manager Terry Kovacevich said it took more than two and a half years to get from lease to well on the reservation, far longer than outside the reservation boundary.

Kovacevich said Marathon won't know how much the well produces until July and then results will remain confidential for six months.

"It's really exploratory on Fort Berthold," he said. "There are not a lot of Bakken wells surrounding us. Geologically, there's a good chance of success." One of leases Wells signed Tuesday was for minerals under the Parshall town site, which would be tapped with a long horizontal leg from a well that could be two miles away.

Oil under Lake Sakakawea in the Bakken formation, 10,000 feet down, will be tapped the same way - sideways from a long way off.

Marathon moved one of its six rigs over to the reservation from Dunn County, on the other side of Lake Sakakawea, where it's averaging about 200 to 300 barrels a day per Bakken well.

Kovacevich wouldn't say how many acres it has leased on Fort Berthold, though its leases in Dunn County and on the reservation make up the majority of the 300,000 lease acres it has in the state.

Marathon has other permits pending for Fort Berthold and how fast and far development goes, depends on how the wells produce.

One thing that could simplify oil exploration on Fort Berthold is a tax agreement in negotiation between the tribal government and North Dakota.

Now, the tribe can't tax oil on fee acres and both the tribes and the state tax oil on trust acres.

The agreement would streamline the two-tax system into one, have the state collect it and share it back to the tribes.

Ryan Bernstein, legal counsel for Gov. John Hoeven, said he hopes an agreement can be signed soon and Wells said the tribal council told their attorneys to finish their review by the end of this month.

Bernstein said a uniform tax rate could increase oil activity on the reservation and Kovacevich, of Marathon, said it would provide more economic certainty for oil companies.

(Reach reporter Lauren Donovan at 888-303-5511 or lauren@westriv.com.)

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Comments

Laugh out loud wrote on Jun 24, 2008 10:42 AM:

" HAHAHAHAHA I come from Fort Berthold but live in Omaha and my mother is yet to see her $$$$ The oil companies have done their part now we are just waiting on the tribe to distribute the $$$. Well maybe if we lived on the Rez then maybe she would have received her $$$ sooner. Shame on the council for lying when my relatives call about the $$$ and you all say its going to be in alphabetical order, that was over 2 months ago and still no $$$. Its my relatives land not yours!!! "

WRIR wrote on Jun 17, 2008 5:28 PM:

" Whatch out there 3 affilated, my reservation has been in the oil production for 80 some years.....you got to watch out for what you are getting into...the company can rip you off from under your nose....think about it people....one day you coucil men is going to be driven a brand new car.....why do you think that..?....he'll sale you out for his profit.. You really got to wacth on what you sign, because you can be paying the oil companies bills before they give you your monies.

One thing the tribe should look into is to by 51% into the company, joint venture.. then they can't rip you off....

even back home our own people dont know what is going on BECAUSE AS LONG AS THEY GET THAT PER-CAPITA EACH MONTH..WHEN WE COULD OF BEN GETTING MORE...LOOK AT OIL PER BARREL A COUPLE OF MONTHS AGO, IT WAS AT IT'S HIGHEST AND STILL WE WERE GETTING A SMALL PER-CAPITA AND THE TRIBES DID NOT SAY A DAM THANG..WHEN WE COULD OF BEN GETTING 5TIMES AS MUCH...

I heard something like the three affilated ran into somthing good like that..be caution on what you sign...

thank you "

onewhospeaks wrote on May 29, 2008 12:47 PM:

" We must not forget about our brothers and sisters who do not have, at one time we were not happy unless all of us were taken care of. Will the Council do this for our tribe? Or will the ones who hit oil do this, this is from the Great Spirit, we must unite and be strong! "

Lola wrote on May 24, 2008 10:26 PM:

" Having money and being free isn't enough. What about all of the other "Indians" who are without this type of luxury, oil. Stolen lands and present day extortion of our brothers & sisters still remain an issue. Please remember that we all need to proceed together and use our resources given to us wisely. We just won Cobell vs Norton, how far can we go with our future? Nobody owns the earth, yet we prosper from her death, our grandmothers cry for us. Mah tsa gu datz. Nativehidatsa "

word wrote on May 21, 2008 3:28 PM:

" don't ever use whiteman and god in the same sentence. hahahaha! use stole and greed instead. "

CPO wrote on May 21, 2008 3:01 PM:

" The most beautiful land was the river bottom where the towns of Sanish and Elbowoods were situated. The tall cottonwoods, the homes, the rodeo grounds, all gone. Now there isn't much of a lake to speak of. Hundreds of people moved to plots of land to farm - and not many knew how to farm. They only knew hunting and gardening. A few tried, a lot failed. The 'beautiful' land on top is flat, almost no trees and now most of the 'farmland' is leased to white lessors. The oil money is a good thing for the reservation - but I'm hoping that everyone who gets any money also finds an advisor to help them save for the future. That's what I'm doing with mine. Saving it because I won't have any social security. "

David Velarde jr wrote on May 21, 2008 12:55 PM:

" I wonder if the Three Affiliated Tribes ever considered joint ventures with any of the oil companies? "

What wrote on May 21, 2008 11:58 AM:

" To Ha Ha Ha, What are you talking about? that is some of the most beautiful land ever created by God, oil or not. I think God has blessed it not forsaken it! "

expositor wrote on May 21, 2008 10:33 AM:

" The reporter here uses the phrase "ducked over to a side table" as if to imply that the chairman was "up to something". Gone, I guess, are the good old days when writers kept their personal bias out of their stories. "

Truth wrote on May 21, 2008 8:47 AM:

" And let the junkets begin.... "

Independent Conservative wrote on May 21, 2008 8:36 AM:

" Go, Fort Berthold! Many of us are behind you all the way. Prosper, prosper, prosper! "

Ha Ha Ha wrote on May 21, 2008 8:14 AM:

" The white man give us the most God for saken land.........OH my goodness, there is oil on this land. HE HE HE HA HA HA!!! "

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