North Dakota Legislature: Bills aim to smooth Oil Patch relations

Lobbyists for oil, landowner and agriculture interests appeared before the Senate Natural Resources Committee to show their support for House Bills 1241 and 1462.

The first relates to notice of oil and gas drilling operations and compensation for loss of agricultural production and income caused by oil and gas production. The House unanimously passed the bill last month.

The bill is already having a positive effect on relations between surface owners and the oil and gas industry, said Myron Hanson of Souris, a representative of the Northwest Landowners Association.

“I have anecdotal reports of oil companies already changing their negotiation practices and adhering to what we believe is the legislative intent of this bill,” he said.

The bill requires mineral developers to provide at least seven days’ notice before initial entry upon land for activities such as inspections, staking and measurements.

Developers must also provide notice of the oil and gas drilling operations contemplated before drilling begins. If a mineral developer fails to give notice, the surface owner may seek relief in court and may receive punitive and actual damages.

There are still issues that need to be clarified and addressed, but the bill is a good step forward, Hanson said.

“The impact of the intense (oil) activity out there can’t be understated on the farmers and ranchers in this state,” he said.

Ron Ness of the North Dakota Petroleum Council also supported the bill, saying it improves communication and clearly states landowners get paid for damages and production loss.

Hanson and Ness also supported House Bill 1462. This would allow a landowner, owner, lessee or lessor of mineral interests to seek help from the state’s Agricultural Mediation Service. The House passed the bill on an 84-9 vote.

Broadening the eligibility for mediation will help address energy disputes between energy companies, surface landowners and owners of mineral rights, said Tom Silbernagel, administrator of the state’s Agricultural Mediation Service.

Ness said the Petroleum Council plans to do outreach efforts to get the message out that mediation is a good step to try to address issues before turning to litigation.

The Dakota Resource Council opposed the bill, calling it “a guise for landowner protection and a semblance of the attention that dispute mediation deserves.”

The bill does not specifically address the mechanics of how the service will handle cases, including compensation or compliance, said Ashley Lauth of the council. The service has the right to refuse cases, and if any party asked to mediate denies the request, mediation does not occur, she said.

“This is a feeble attempt to address a large and problematic issue and putting undue burden on an agency that might not be capable of handling the volume of mediation cases,” Lauth said.

A true mediation board committed to landowners needs to be instituted, she said.

The Senate Natural Resources Committee did not immediately act on either bill.

Source: Inforum