Landowners group sues North Dakota over 'pore space' law

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This legal suit has the potential to disrupt U.S. oil operations due to disgruntled landowners.

Landowners group sues North Dakota over 'pore space' law

A landowners group on Monday sued the state over a new law related to compensation for the use of cavities in underground rock formations, calling it “a taking of the inalienable rights of North Dakota landowners.”

The Legislature this spring passed Senate Bill 2344, which sought to clarify issues surrounding “pore space.” The space — cavities in rock or soil — can be used to inject saltwater from oil and gas production or for enhanced oil recovery, a process that involves pumping carbon dioxide into old oilfields to extract more crude.

Under the law, which takes effect Thursday, some landowners cannot be compensated for their pore space when it is used for saltwater disposal or enhanced oil recovery, unless they have an existing contract, according to the lawsuit. Furthermore, landowners adjacent to a disposal well cannot make a claim that saltwater has migrated into their pore space.

The Northwest Landowners Association in its lawsuit filed Monday says the law “strips landowners of their right to possess and use the pore space within their lands and allows the State of North Dakota to directly redistribute that right to others without the consent of or compensation to the landowners.”

The association filed the suit in Bottineau County in the Northeast Judicial District, naming the state, Industrial Commission, Board of University and School Lands, the governor and the attorney general as defendants. The group is asking the court to overturn the law, claiming it violates the federal and state constitutions on due process and equal protection grounds, among others.  ...

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In many places, mineral rights are based on specific 'minerals' and depth. Do the surface landowners even have legal standing in this issue?

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1 hour ago, Douglas Buckland said:

In many places, mineral rights are based on specific 'minerals' and depth. Do the surface landowners even have legal standing in this issue?

Land is surface and below ground.  SOMEONE owns the adjacent mineral rights.  Doesn't matter if the current occupant on the surface owns the below ground mineral rights.  Someone not the well operator DOES own those rights.

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North Dakota has really messed this up! When horizontal drilling became a reality, they turned largely to the pioneer in this endeavor up in ND: Harold Hamm. He sagely advised them to use the "Oklahoma Model" in all things. In Oklahoma there is a Corporation Commission which regulates increased density (infill drilling). It is a matter of whether there are sufficient wells to fully drain an oil or gas-bearing area of its largesse. The whole thing is very transparent. Similarly, disposal wells are regulated, probably more stringently than oil wells. But the North Dakota system took a wrong turn; it is opaque to everyone but operators, in whose favor it is heavily skewed. For example, the "Confidential Status" list in North Dakota can mean anything from a planned well being permitted to any stage of drilling and completion, and a well can remain on that list for quite some time before a royalty owner has a clue. Frequently, unless you're connected, a set of division orders is the first demonstration of new activity. It sounds to me as though this heavy favoritism toward drillers and operators extends all the way to the disposal of contaminated frack and production water. This just flat isn't right! Morally, ethically, democratically. This country wasn't founded on the ability to dupe people. Trust me, as a landowner in Oklahoma, there are plenty of devils in the details without having to worry about the clever wording of a contract that should--and proverbially is--regulated by the North Dakota Industrial Commission, Oil and Gas Section. The whole matter is hard enough for many landowners, because the planet has held all the water on it since formation--no new water is being deposited here. To take contaminated water and sequester it away means that that particular quantity of water has forever been removed from the life cycle of water: no more evaporation, rain and snow, etc. Lots of landowners are concerned about that. Just like flaring, this is not about what the industry "can get by with," but what is right. 

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15 hours ago, Wastral said:

Land is surface and below ground.  SOMEONE owns the adjacent mineral rights.  Doesn't matter if the current occupant on the surface owns the below ground mineral rights.  Someone not the well operator DOES own those rights.

Perhaps, but the title indicates that the landowners sued.

Landowners do not necessarily own 'below ground', which is why you find that in many cases the landowner does not receive a royalty payment.

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3 hours ago, Douglas Buckland said:

Perhaps, but the title indicates that the landowners sued.

Landowners do not necessarily own 'below ground', which is why you find that in many cases the landowner does not receive a royalty payment.

A cursory look at the quote says to me that they're fighting about void spaces underground that are now considered an "asset"? Can't imagine there's a way to pay someone a royalty on no production, just disposal. 

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6 hours ago, Gerry Maddoux said:

The whole matter is hard enough for many landowners, because the planet has held all the water on it since formation--no new water is being deposited here. To take contaminated water and sequester it away means that that particular quantity of water has forever been removed from the life cycle of water: no more evaporation, rain and snow, etc. Lots of landowners are concerned about that. Just like flaring, this is not about what the industry "can get by with," but what is right. 

Where would you like them to put the contaminated water? Rivers, lakes? 

It's not like the badlands there are a hotbed of farming largess. Before oil, you were lucky to grow a tumbleweed. 

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15 minutes ago, Ward Smith said:

A cursory look at the quote says to me that they're fighting about void spaces underground that are now considered an "asset"? Can't imagine there's a way to pay someone a royalty on no production, just disposal. 

What I am trying to determine is how a surface landowner, with no mineral rights, has legal standing concerning 'pore space'?

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7 hours ago, Douglas Buckland said:

What I am trying to determine is how a surface landowner, with no mineral rights, has legal standing concerning 'pore space'?

I think it's like the water, law of capture.  If it's under your land, it's yours.  Pore spaces aren't minerals, the minerals may have been in them.  Here in Texas, operators have to pay the landowner for the right to use his pore space, i.e. drill disposal wells.  I think the supreme court ruled in favor of landowners and now the tinhorn legislature in ND is trying to make a law that circumvents the ruling.  

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