An oil company must pay to use two former oil wells to dispose of salt water, despite its belief that a new regional production agreement ended its obligations, the North Dakota Supreme Court has ruled.

The unanimous decision, made public Tuesday, means Burlington Resources Oil and Gas Co. LP owes at least $380,000 to two families who challenged the company's decision to quit paying disposal fees more than five years ago.

Since the mid-1990s, Burlington and a subsidiary, Meridian Oil Inc., had been paying the families 5 cents a gallon to pump salt water into two abandoned oil wells in Bowman County, in North Dakota's southwestern corner, court documents say. Burlington is now owned by ConocoPhillips.

In April 2001, the state Industrial Commission established an oil production agreement in Bowman County, called Cedar Hills South-Red River B. The agreement, which Burlington managed, allowed dozens of existing oil leases to be managed as if they were a single unit.

Burlington notified Larry Buchholz, the trustee of a family mineral trust, and other family members in October 2003 that the company intended to stop payments for using a well on the Buchholzes' land to dispose of salt water. Brine is a common byproduct of oil production.

A few months afterward, the company sent a similar letter to Victor and Ethelyn Uttke of Spearfish, S.D., who were representatives of a family limited partnership, court documents say.

Both families disputed Burlington's argument that the unit agreement absolved the company from paying the disposal fee. Burlington continued using the wells, and the families sued.

Southwest District Judge Allan Schmalenberger ruled the unit agreement did not change or override Burlington's disposal arrangement with the Buchholzes and the Uttkes. The company appealed, and on Tuesday, the state Supreme Court unanimously ruled in favor of the two families.

"The agreements do not prohibit Burlington from using the Buchholz and Uttke wells to dispose of waste salt water," says the court's opinion, written by Justice Dale Sandstrom. "Rather, the agreements merely provide that if Burlington uses the disposal wells, it must pay a fee."

Court documents say the Buchholzes are owed $210,350 for salt water dumped in their well from August 2003 to August 2007, and that the Uttkes are owed $171,943 for disposal during the same period.