Industrial Commission considers new rules to protect areas of "extraordinary significance"

By DAVE THOMPSON

The state Industrial Commission is looking at proposed new rules dealing with oil activity in certain areas of North Dakota.

Attorney General Wayne Stenehjem has proposed the rules – to cover drilling in what he called places of extraordinary significance – such as the Killdeer Mountain Battlefield, the Little Missouri Grasslands and the Elkhorn Ranch. Stenehjem told his Industrial Commission colleagues – this will NOT prohibit oil exploration in those areas – but it asks the companies to have a “mitigation plan.”

The state Industrial Commission is looking at proposed new rules dealing with oil activity in certain areas of North Dakota.

Attorney General Wayne Stenehjem has proposed the rules – to cover drilling in what he called places of extraordinary significance – such as the Killdeer Mountain Battlefield, the Little Missouri Grasslands and the Elkhorn Ranch. Stenehjem told his Industrial Commission colleagues – this will not prohibit oil exploration in those areas – but it asks the companies to have a “mitigation plan.”

"What are they going to do in those areas to provide for a reduction -- as much as possible -- of any impact?" Stenehjem told his colleagues.

The proposed rules also allows for more public comment before wells are drilled in those sensitive areas.

"This process gives everybody a right to a say, but it doesn't give everybody a right to their way," said Stenehjem.

Gov. Jack Dalrymple chairs the Industrial Commission. He says to this point, he thinks the Commission has done a good job of being sensitive to those areas.

"I think you do point out a flaw in the process," Dalrymple told Stenehjem. "The lack of a formalized way to gather public input is probably correct.

"It's a good start," said Jim Fuglie. The fomer state Democratic NPL party chairman has been critical of plans to drill near the Killdeer Mountains and near Bullion Butte in Billings County. Fuglie says it appears the Industrial Commission will be more attuned to concerns raised by residents in those impacted areas.

"If someone looked at every one of the 3000 drilling permits issued in 2013, to see if there's one in some wildlife habitat, where the wellsite could be moved a half mile to allow mule deer a place to make love and create more mule deer," said Fuglie. "That's the kind of scrutiny that has not happened."

Meanwhile, a spokesman for the oil industry says while the industry agrees with many of the new rules, it has concerns about balancing public input with rights of private landowners and mineral rights holders.

"I happen to live in Bismarck, and my back yard is close to a theatre and a little park," said North Dakota Petroleum Council President Ron Ness. "I put a chain link fence up there. Should someone have been able to tell me the chain link fence really doesn't fit?"

The Commission will be holding another meeting to see if it wants to adopt Stenehjem’s proposal. If it does – it would also have to go through the Legislature’s Administrative Rules committee before final adoption.

Enlarge image

Credit Dave Thompson / Prairie Public

Members of the North Dakota Industrial Commission briefed on proposed new rules for oil drilling in areas of "extraordinary significance."

Industrial Commission of ND Meeting on Places of Extraordinary Signficance

AGENDA

Industrial Commission of North Dakota

 including a Joint Meeting with the 

Housing Finance Agency Advisory Board 

Thursday, December 19, 2013

9:00 a.m. – Harvest Room & Governor's Conference Room

I.   North Dakota Department of Mineral Resources Business – Lynn Helms
A.  Consideration of Order 23935  issued in Case 15773 in response to a petition for 
reconsideration of Order 18028  (Attachment 1)
B.  Consideration of orders for the following cases which were heard on October 24 and
November 20, 2013 : (Attachment 1a)
Case 20800, Order 23106 – request for two 1440 acre spacing units
Case 21158, Order 23462 - request for use of double wall open tank receptacles for storage of
produced water – exception to NDAC §43-02-03-19.3
Case 21219, Order 23523 – creation of two 1280 acre spacing units
C.  Consideration of Case 20853, Order 23159 heard on October 1, 2013 - Amendments to
Administrative Rules (Attachment 2)
D.  Consideration of proposed rules relating to general drilling permit consideration; designation 
of places of extraordinary significance; and additional requirements for permitting in places of 
extraordinary significance.  – Attorney General Stenehjem (Attachment 3)
E.  Other North Dakota Department of Mineral Resources business

(approximately 10:05 a.m.)
II.  North Dakota Pipeline Authority Business – Justin Kringstad
A.   Presentation of 2013 Annual Report and Financial Report (Attachments 4 & 5) B.   Other North
Dakota Pipeline Authority business

*******Meeting will break to relocate to the Governor’s Conference Room*******

(approximately 10:10 a.m.)
III.  Lignite Research, Development & Marketing Program Business – Jason Bohrer, Mike Jones
(by phone)
A.  Presentation of comments being presented on December 19, 2013 to the Minnesota Public Utilities
Commission in the Matter of the Investigation into Environmental and Socioeconomic Costs Under
Minn. Stat. §216B.2422, subd.3.– Attorney General Stenehjem (Attachment 6)
B.  Presentation of Lignite Research Fund Financial Report– Karlene Fine (Attachment 7)

Industrial Commission Meeting
Page 2
December 19, 2013

C.  Consideration of the Lignite Research Council’s recommendations regarding the following Grant
Round 76 applications:
1.   “Investigating the Use of Fly Ash and Nanomaterials for Sustainable Concrete Infrastructure”;
Submitted by University of North Dakota Department of Civil Engineering; Request for $14,559 (Small
Research); Total Project Costs $60,642; Project Duration 14 months (Attachment 8)
2.   “Continuation of Underground Coal Gasification Study in Western North Dakota”; Submitted by
University of North Dakota Institute for Energy Studies; Request for $299,958 (Demonstration);
Total Project Costs $719,958; Project Duration 18 months (Attachment 9)
3.   “Alstom’s Chemical Looping Combustion Technology with CO2 Capture for
North Dakota Lignite Utilization”; Submitted by Alstom Power Inc.; Request for
$500,000 (Demonstration); Total Project Costs $10,489,821; Project Duration 36 months (Attachment
10)

*****Consideration of a motion to close the Industrial Commission meeting pursuant to North Dakota
Century Code 54-17.5-06 to consider the following agenda item regarding a project that has
previously been determined to be confidential******

D.  Update by American Lignite Energy, LLC regarding their project “Lignite Vision 21
Project Coal-to-Liquids Plant McLean County, North Dakota” – Carroll Dewing, David
Straley


**********Meeting returns to open session*******

E.  Consideration of a request from American Lignite Energy, LLC for an amendment to Contract
FY06-LVII-148 amending the “Decision Date” from December 31, 2013 to December 31, 2014 (Attachment
11)
F.  Other Lignite Research, Development & Marketing Program business

IV.  North Dakota Transmission Authority – Mike Jones
A. Presentation of 2013 Transmission Authority Annual Report and Financial Report
(Attachments 15 & 16)
B. Other Transmission Authority business

(approximately 10:45 a.m.)
V.  North Dakota State Mill Business – Vance Taylor (by phone)
A.  Consideration of request to increase FY 2014 Capital Project – K-Mill Capacity Increase – Phase
3 by $800,000 bringing total project costs to $3,900,000. (Attachment 17)
B.  Other North Dakota State Mill business

(approximately 10:55 a.m.)
VI. Bank of North Dakota Business – Eric Hardmeyer
A.   Presentation of the following audits – Eide Bailly

Industrial Commission Meeting
Page 3
December 19, 2013

1.   PACE Audit – June 30, 2013 (Attachment 18)
2.   Ag PACE Audit – June 30, 2013 (Attachment 19)
3.   Rebuilders Loan Program Audit – June 30, 2013 (Attachment 20)
B.  Consideration of amendments to School Eligibility for DEAL Loan Policy
(Attachment 21)
C.  Consideration of amendments to Funds Management Policy (Attachment 22)
D.  Presentation of nonconfidential Bank of North Dakota Advisory Board October 17, 2013 meeting
minutes (Attachment 23)
E.  Other Bank of North Dakota business

******Meeting closed pursuant to N.D.C.C. 6-09-35 to discuss items listed below on the agenda under
Bank of North Dakota Confidential Business********

VII.  Bank of North Dakota Confidential Business – Eric Hardmeyer
A.  Consideration of Bank of North Dakota loan application (Attachment 24) B.  Problem Loan Update
C.  Presentation of confidential Bank of North Dakota Advisory Board October 17, 2013 meeting
minutes (Attachment 25)
D.  Other Bank of North Dakota confidential (as defined under N.D.C.C. 6-09-35) business

***************Meeting returns to open session******************

(approximately 11:40 a.m.)
VIII. Western Area Water Supply Authority business – Jaret Wirtz (by phone) & Karlene Fine A.
Presentation of Western Area Water Supply Authority monthly report (Attachment 26) B.  Other WAWSA
business

(approximately 11:50 a.m.)
IX.   Joint meeting with the North Dakota Housing Finance Agency Advisory Board on North
Dakota Housing Finance Agency Business – Jolene Kline
A.  Presentation of the Housing Finance Agency Advisory Board Vice-Chairman’s Annual
Report – Ron Jordan (Attachment 27)
B.  Presentation of the Housing Finance Agency’s Fiscal Year 2013 Audit – Brady Martz
(Attachment 28 )
C.  Presentation of the Housing Incentive Fund Fiscal Year 2013 Audit – Brady Martz
(Attachment 29)
D.  Consideration of the Housing Finance Agency Advisory Board’s recommendation for the Agency to
enter into a contract with Fannie Mae to offer the HFA Preferred Risk Sharing Program (Attachment
30)
E.  Consideration of the Housing Finance Agency Advisory Board’s recommendation to rescind the
Reserve Funds Order Policy (Attachment 31)
F.  Consideration of the Housing Finance Agency Advisory Board’s recommendation to approve the
Agency’s SWAP Management and Executive Policy (Attachment 32)
Industrial Commission Meeting
Page 4
December 19, 2013
G.  Consideration of the Home Mortgage Finance Program 2014 General Authorization
Resolution (Attachment 33)
H.  Consideration of the North Dakota Industrial Commission’s Executive Director recommendation
regarding the appointment of the North Dakota Housing Finance Agency Executive Director (Attachment
34)
I.   Other North Dakota Housing Finance Agency business

(approximately 12:20 p.m.)
X.  North Dakota Outdoor Heritage Fund business – Karlene Fine
A.  Update on Outdoor Heritage Fund Grant Round applications. (Attachment 35) B.  Other Outdoor
Heritage Fund business

(approximately 12:25 p.m.)
XI. Administrative Business – Karlene Fine
A.  Consideration of transfers from Industrial Commission agencies/programs for the
2013-2015 biennium for the Administrative Office operations (Attachment 36)
B.  Other Industrial Commission Administrative business

XII. Other Industrial Commission Business/Adjournment

Bold items require Industrial Commission action
Any person who requires an auxiliary aid or service must contact or notify the Industrial
Commission
Office at 328-3722 at least three (3) working days prior to the scheduled meeting.

http://www.nd.gov/ndic/ic-press/magenda.pdf

Published November 11, 2013, 10:41 AM

ND officials debate need for list of ‘special places’ to be protected

FARGO, N.D. — A divided North Dakota Industrial Commission soon will decide whether to designate special places subject to development restrictions to protect them from oil drilling or other development.

By: Patrick Springer, Forum News Service

FARGO, N.D. — A divided North Dakota Industrial Commission soon will decide whether to designate special places subject to development restrictions to protect them from oil drilling or other development.

The commission has discussed the possibility of a list of special sites for half a year, and Gov. Jack Dalrymple proposed more than 40 candidate sites on a tour in late August.

Spots include Little Missouri State Park, where Dalrymple made his announcement, Killdeer Mountain, roadless areas in the Little Missouri National Grasslands and the units of Theodore Roosevelt National Park.

Attorney General Wayne Stenehjem also is compiling a list and formulating a policy for “extraordinary places” that also will include the Little Missouri River as it winds through the western North Dakota Badlands.

Stenehjem planned to present his proposal to his fellow Industrial Commission members at the group’s Nov. 18 meeting, but he told The Forum of Fargo-Moorhead’s editorial board last week that it’s more likely that he will do so at the meeting slated for Dec. 19.

“There’s a lot of beautiful areas out there,” Stenehjem said, adding that the commission, which approves drilling permits, already imposes restrictions to try to minimize impacts.

However, he said, a formal procedure has been lacking, with decisions made on a case-by-case basis as the commission reviews drilling permits.

“I’m working on a plan I can present,” with requirements spelled out in administrative rules that, if passed under emergency provisions, could take effect early next year, Stenehjem said.

Public hearings and opportunities for public comment are included in the rule-making process, he said. Some conservation advocates have complained that the process of designating special places so far has not been open to public participation.

Restrictions could include requiring wells to be located a long distance from special places – say, two miles – or requiring pipe placement to avoid flaring natural gas, he said.

“Just a whole lot of things can be done,” Stenehjem said.

The attorney general said he has met informally with representatives of the oil industry as well as conservation groups to ensure support for his proposal.

In reviewing permits, the commission must balance the rights of mineral holders against the duty to protect landscapes, and must let the public be heard, Stenehjem said.

Devising a list of special places and procedures for developing around the sites would provide the industry greater clarity about how to proceed in certain areas, he said.

“I think industry might be happy if they know what that area is,” he added.

As an example, he said the commission required XTO to drill a well two miles from the Elkhorn Ranch, a unit of Theodore Roosevelt National Park and a ranch home of the great conservation president, instead of nearby, as the company originally proposed.

“I knew we were never going to put a well on the Elkhorn Ranch,” Stenehjem said.

Besides the Elkhorn Ranch and Little Missouri River, Stenehjem mentioned Killdeer Mountain and battlefield sites, Bullion Butte, and the national and state parks.

The lists Dalrymple and Stenehjem are contemplating appear to have a lot of overlaps, but the third member of the industrial commission, Agriculture Commissioner Doug Goehring, said he is not in favor of such lists.

“When you talk about special places, I would consider all of North Dakota special,” Goehring said. “It’s going to be case by case because every site’s unique,” he added, referring to the review of drilling permits.

“I would say we’re doing a good job of doing that, making sure there are stipulations that it’s developed in a responsible manner,” Goehring said, including reclamation requirements for wells and tank clusters.

Goehring has compiled a list of permits that have been issued with stipulations or were rejected, including a running total of the number of acres involved.

Over the past year, 2,741 permits were submitted to the Industrial Commission involving development of about 3.5 million mineral acres.

Of that total, 268 permits involved an “area of concern,” totaling about 343,000 acres.

Thirty-five of those permits, involving 45,000 acres, were rejected. Well placements on another 49 permits encompassing 63,000 acres were modified due to concerns about topography, erosion, watershed or soils.

In a final category, 463 permits affecting 560,000 mineral acres were approved with stipulations, such as shallow aquifer or surface water protection.

“Beauty is in the eye of the beholder,” Goehring said. “A lot of things I think are beautiful, people pooh-pooh,” including farm fields.

Goehring said he is concerned that if certain places are designated as special, restrictions on agricultural land eventually could result.

“Because there’s people there who would like to see us go back to buffalo commons,” Goehring said, referring to a prediction 20 years ago that vast tracts of the Great Plains would revert to sprawling rangeland for wild game, including buffalo.

- See more at: http://www.prairiebizmag.com/event/article/id/16715/group/Economic%20Development/#sthash.mhLxLGM9.dpuf

Published October 26, 2013, 11:20 PM

Stenehjem says he'll release list of 'extraordinary places' for protection from energy development soon

BISMARCK – North Dakota Attorney General Wayne Stenehjem has been meeting with people behind the scenes to compile a list of what he calls “extraordinary places” that deserve protection from energy development and other impacts, drawing criticism from a former Democratic Party leader who believes the discussions should be held publicly. By: Mike Nowatzki, INFORUM

• Killdeer Mountains

An oil pump works near Killdeer, N.D., with the Killdeer Mountains in the background. The Killdeer Mountain battlefield and wildlife management area is one of the places Attorney General Wayne Stenehjem said he’d consider for protection from energy development. John Steiner / Forum News Service

BISMARCK – North Dakota Attorney General Wayne Stenehjem has been meeting with people behind the scenes to compile a list of what he calls “extraordinary places” that deserve protection from energy development and other impacts, drawing criticism from a former Democratic Party leader who believes the discussions should be held publicly.
Stenehjem said he has sought input from a variety of people and hopes to have the list ready for the state Industrial Commission, which grants oil drilling permits, for consideration at its Nov. 18 meeting.
“I think there’s a view that we need to do more to assure the public that we’re protecting some of those pristine areas,” said Stenehjem, who sits on the commission with Gov. Jack Dalrymple and Agriculture Commissioner Doug Goehring. “And we do a lot of that now, but it’s not on a formal basis.”
Stenehjem first proposed such a list at a commission meeting in January. The idea gained steam after a public uproar in March when news broke that an oil company had staked out a site near the entrance to the historic Elkhorn Ranch in Theodore Roosevelt National Park.
The company, XTO Energy, withdrew its permit application, and on Tuesday the Industrial Commission approved a new permit for XTO that will keep drilling activity about two miles away from the Elkhorn Ranch entrance.
Stenehjem said an oil rig right next to Elkhorn Ranch “was never going to happen,” and he hopes the new list will assure the public that such places will be protected. While the list isn’t finalized, some of the places Stenehjem said he’d like to consider for protection are Bullion Butte, Killdeer Mountain battlefield and wildlife management area, Elkhorn Ranch, White Butte and Little Missouri River State Park.
All of those places were included in a list of about 40 areas of historical, cultural or biological interest that was compiled from various sources earlier this year. It didn’t receive any official designation from the Industrial Commission, but it provided a list of places for commissioners to tour, which they decided to do individually because of their schedules.
To help him compile his own list, Stenehjem has held two meetings in his conference room with what he describes as “kind of an informal grouping,” adding, “I’ve had lots of other meetings just with other individuals.”
Jim Fuglie, a former executive director of the state Democratic-NPL Party who now writes “The Prairie Blog,” has criticized Stenehjem in recent blog posts, referring to the group as a “secret task force” holding “secret meetings.” He questioned whether the state’s open meetings laws are being followed. Fuglie did not return a phone message left at his home Thursday.
Stenehjem said he organized the group and meetings by himself, and the Industrial Commission didn’t delegate authority to him to do so.
“If it were delegated by the Industrial Commission, then of course it would likely be an open meeting,” he said. “But this is just me using people whose judgment and knowledge I respect to offer suggestions.”
Jack McDonald, a lawyer for the North Dakota Newspaper Association, said there must be direction given or an act of creation by the governing body to make it a task force subject to open meetings.
“Of anybody in state government, (Stenehjem) has been so hyper about open meetings and stuff and so vigilant … I just can’t imagine that he’s deliberately violating the law,” McDonald said.
Stenehjem said that after his list is compiled and presented to the Industrial Commission, the idea is to develop a policy and rulemaking process for protecting the extraordinary places.
He said the rules to be considered for development in those areas might include requiring an impact mitigation plan; prohibiting the flaring of natural gas or requiring that pipelines for capturing it already be in place before drilling begins; setback requirements; or painting oil pumps to camouflage them.
While the commission wants to protect the state’s special places, Stenehjem said he’s not talking about an outright ban on energy development.
“Private people own those minerals, and they have a legal right, a constitutional right, to have them developed, and so we have to respect that,” he said. “But at the same time, we also have an obligation to the citizens of North Dakota and the future to make sure that everybody is comfortable that we’re doing what we can to protect these areas as much as possible.”
The concept also will entail a process for public comment on proposed developments “at a meaningful time,” he said.

---

Readers can reach Forum News Service reporter Mike Nowatzki at (701) 255-5607 or by email at mnowatzki@forumcomm.com.

http://www.inforum.com/event/article/id/416557/group/News/

Balancing the equation in western N.D.

15 hours ago  •  Tribune editorial

The ramp-up of the oil boom in western North Dakota has had local and state agencies playing catchup for three or four years — in particular, when it came to transportation and housing infrastructure and providing essential services. Much progress has been made.

A case now can be made that the state needs to catch up on the protection of cultural heritage, wildlife and natural history sites.

North Dakota needs to find that balance between development and preservation that best serves its citizens now and in the future.

Initial steps are being taken along those lines:

-- The Legislature established the North Dakota Outdoor Heritage Fund to assist state agencies, tribal governments, political subdivisions and nonprofit with preservation and enhancement of wildlife habitat, outdoor recreation opportunities and conservation projects. Funding: $30 million for the next two years.

-- A list of 40 sites, including roadless areas, wildlife habitat and cultural features, have been nominated to the Industrial Commission for protection in the oil-leasing process.

-- The members of the Industrial Commission — Gov. Jack Dalrymple, Attorney General Wayne Stenehjem and Agriculture Commissioner Doug Goehring — are individually visiting potentially vulnerable cultural heritage sites and key habitats in western North Dakota over the next several weeks. Dalrymple recently spent nine hours one day in cars and in the air visiting nine sites in western North Dakota. Similar tours are expected by Stenehjem and Goehring.

The idea is to not lease, or lease with restriction, certain sites because they are vulnerable to development and need to be preserved for the common good. The North Dakota Game and Fish Department and state Parks and Recreation Department have been providing information to the state Department of Trust Lands, which controls state properties put on the mineral auction block.

Up until recently, neither the state Game and Fish Department nor the state Parks and Recreation Department have been at the table when key decisions were made about oil development in the western counties. They need to be strong voices for the lands and natural resources that they manage. Game and Fish Director Terry Steinwand and Parks Director Mark Zimmerman need to step up. Both men traveled with Dalrymple on his recent tour of western sites. We can only hope that they made strong cases to the governor for preservation where it’s needed.

The members of the Industrial Commission need frank advice from these two agencies, as well as the state Health Department. Clearly, Lynn Helms, the director of the Mineral Resources Department, has the bully pulpit when it comes to oil exploration and production issues before the Industrial Commission. His voice needs to be challenged on particular issues.

Oil is in North Dakota’s future. We’ve consistently acknowledged oil’s role and stated that it needs to be done right. Finding the balance between development and preservation is a part of North Dakota doing oil development right. The developing controversy over the Killdeer Mountains Battlefield tells us we are not there yet.

http://bismarcktribune.com/news/opinion/editorial/balancing-the-equation-in-western-n-d/article_1381ddfe-1193-11e3-bc5a-0019bb2963f4.html

North Dakota makes list of sites threatened by oil drilling

21 hours ago  •  Associated Press

BISMARCK, N.D. _ Roadless tracts of grasslands, numerous parks, wildlife areas and North Dakota's highest peak at White Butte are among 40 sites in the western part of the state that have been nominated for increased protection from oil drilling.

The list was compiled by the state Industrial Commission with comments from the public, environmental groups and government agencies over the past two years, said Karlene Fine, the commission's director.

Gov. Jack Dalrymple is chairman of the commission, which regulates North Dakota's oil and gas industry. Attorney General Wayne Stenehjem and Agriculture Commissioner Doug Goehring are its other members.

The men — all Republicans — are slated to visit most of the sites in western North Dakota's oil patch over the next several weeks.

Jeff Zent, a spokesman for Dalrymple, said scheduling conflicts prohibit the panel from traveling together.

Dalrymple was slated to begin his tour Thursday to see areas identified as having historical, cultural and recreational significance, as well as areas that support unique wildlife and plant habitat, Zent said.

"The governor will be going out west. He already has seen a lot of western North Dakota but he does want to go back out there to look at some specific sites," Zent said. "It may work out best in the long run to have the commissioners go out individually because they may be able to cover more ground."

Many of the sites identified on the list are on state or federal land and several of those are intermingled with private land, Fine said.

Wayde Schafer, a North Dakota spokesman for the Sierra Club, said the mixed bag of land ownership creates a "patchwork of problems" for conservation groups and regulators.

"It's not clear what level of protection the Industrial Commission has for these sites," Schafer said. "Each of these sites will have to have their own set of solutions to protect their historic or ecological significance."

Further complicating oversight of culturally or environmentally sensitive areas is that a tract of land in North Dakota can have separate owners, above and below ground. Surface owners are typically trumped by mineral owners who are allowed to access the land for exploration under state law.

"Mineral owners in this state can develop their minerals," said Goehring, of the Industrial Commission. "We just have to address concerns and minimize those impacts."

Goehring said some examples include requiring companies to build roads or place wells in the least intrusive areas possible, or even requiring companies to paint tanks and other equipment so that it blends with the landscape.

Stenehjem said he often vacations in western North Dakota and has done so as late as last weekend. He already has visited many of the identified sites and intends to look at more of them in the coming weeks.

Of particular concern, he said, is the issue of natural gas flaring in western North Dakota, where about 30 percent of the state's gas production is being burned off or "flared" because development of the pipelines and processing facilities needed to handle it has not kept pace with production.

"We've done a lot but we need to do more," Stenehjem said.

http://bismarcktribune.com/bakken/north-dakota-makes-list-of-sites-threatened-by-oil-drilling/article_c04ff430-0a9a-11e3-8f06-0019bb2963f4.html

Group seeks to protect Killdeer Mountains from oil

August 15, 2013 8:20 am  •  Associated Press

MINOT, N.D. — An alliance working to protect the environment and history of the Killdeer Mountains in western North Dakota's oil patch wants state regulators to reconsider how oil is being tapped there.

The Killdeer Mountain Alliance has asked members of the state Industrial Commission to include the Killdeer Mountains on planned tours of culturally important sites. The group also wants the commission to delay any further oil drilling on public land on the west side of the mountains until considering its alternative drilling plan.

That plan would access the same oil from a different location, which would require three miles of horizontal drilling but would be safer and cause less archaeological damage, according to the group that includes landowners, former residents, historians, Native Americans, archeologists, wildlife biologists, hunters and others.

"I would like to specifically show them, on the ground, the alternative we are suggesting and how that would help," said landowner Rob Sand, coordinator of the alliance. "It's public land that has been enjoyed for ages by hunters, by lease holders, by cattle, by just sightseers. Native Americans have taken quite an interest in this whole issue because they have held this as a sacred ground."

Industrial Commission members have not been able to coordinate their schedules for a joint tour of culturally sensitive sites but will be touring individually. They also are open to looking at possible new approaches to drilling, said Jeff Zent, spokesman for Gov. Jack Dalrymple, who sits on the Industrial Commission with Agriculture Commissioner Doug Goehring and Attorney General Wayne Stenehjem.

State Department of Mineral Resources Director Lynn Helms also is expected to be involved in the tours but the locations to be included have yet to be determined, said department spokeswoman Alison Ritter.

The Industrial Commission last January approved drilling for eight new wells in the Killdeer Mountains area, and later rejected an appeal to reconsider. Sand said two wells have been drilled so far. The drilling has sparked protests from ranchers and American Indians concerned about sacred or historic sites, including the site of an historic 1864 battle between Army soldiers and Indians.

The alliance is not opposed to oil development but wants it conducted in an environmentally friendly manner, Sand said.

"Most people in this state look at the Killdeer Mountains, I believe, as a scenic place that they want to enjoy as unspoiled as possible," he said.

Hess Corp., which is doing the drilling, has said it is committed to safeguarding the environment.
http://www.miamiherald.com/2013/08/15/3564094/group-seeks-to-protect-killdeer.html#morer

03/19/2013

Revamping the North Dakota Industrial Commission

By Aaron Barth

Signage at Roosevelt’s Elkhorn Ranch. Photo from September 2012.

Theodore Roosevelt passed the American Antiquities Act of 1906after experiencing what unencumbered industrialization had done to the American West. Since 1906, this initial piece of legislation has been amended and updated to reflect the changing times. I was thinking about that when I read this morning’s story in The Dickinson Press, “Oil Company Stakes Out Area for Well Pads Steps Away from Roosevelt’s Elkhorn Ranch.” A subsidiary of ExxonMobil, XTO Energy has staked an area immediate to Roosevelt’s 1883 Elkhorn Ranch just along the Little Missouri River in the badlands of western North Dakota.
With the American bison nearly extinct (and who knows what other species), when Teddy was president he decided to draw some boundaries around sections of wilderness for preservation. He did this for both applied and philosophical reasons. By setting aside and declaring these spaces sacred, us Americans would be able to engage in recreation (when unpacked, the word means re-create), and we would also have a kind of common cultural datum that we could all associate with from one generation to the next. These cultural datums provide society with stability in that everyone has a common point of reference. “Hey, did you go to Elkhorn Ranch last weekend?” The response is, “Yeah,” and both individuals know they experienced and perceived the same looking landscape, the same space, but at different points in time. This is what David Glassberg was getting at in his 2001 work, Sense of History. After attending two meetings in Bismarck that concerned the Killdeer Mountains in January and February, 2013, I and others increasingly believe that this is fairly meaningless to the majority party bottom-liners in our state government. I’ve thought about this, and wondered if there was a better way to bring our State Industrial Commission up to speed.

Sometimes folks go to the Elkhorn to read about the Elkhorn. Photo from September 2012.

The State Industrial Commission was originally formed in 1919 with the idea that it would guide industrial development in the state. I am not against industry. In fact, I don’t know how someone could be “against” industry. It would be impossible. I recognize it as the substructure upon which the superstructure of our culture rests: if you like the arts and humanities, you gotta have an industrial foundation. In 1919, only 30 years after North Dakota had gotten its statehood start, a three-person industrial commission worked. Almost 100 years later, we are learning that an industrial commission with only 3 voices on it is not working for a state with a population of approximately 700,000 (and growing).
As of March 19, 2013, the only three voices on the commission are as follows: 1) Jack Dalrymple, who was born into family Bonanza farming in Casselton, and received a bachelors in American Studies from Yale (I think under Howard Lamar, who wrote a great piece of scholarship entitled, Dakota Territory 1861-1889: A Study in Frontier Politics [1956]); 2) Wayne Stenehjem, who has a juris doctorate from the University of North Dakota (Wayne’s father was a former president of our Bank of North Dakota; and 3) Doug Goehring, who operates a 2,000-acre farm near Menoken (note: at the end of this blog posting, I have cut and pasted the public Meet the Commissioner profiles to this blogspot).
These three are supposed to listen to Lynn Helms (who holds a bachelors of science in engineering from the South Dakota School of Mines), and Lynn is supposed to be an expert at informing the commission on approving drilling permits. At the last meeting I attended on Killdeer Mountains, Lynn attempted to explain the archaeology and history to the three commissioners, and this was unfair to him: Lynn’s training is in engineering and his professional life history has been in the oil business. He indeed is familiar with the workings of his profession. But when it comes to history and archaeology, he is tasked with learning about and briefing the public on two disciplines that professional historians and archaeologists think about incessantly, 24/7, 365 days/year, for their entire lives.

Public visitor sign-in list at Roosevelt’s Elkhorn Ranch in western North Dakota. Photo from September 2012.

The three of these commissioners reflect just a small cross section of North Dakota society, yet they are tasked with the job of making decisions for one and all. This isn’t 1919 anymore. It is 2013, and it is only fair to modify the industrial commission accordingly. Here is one idea: the industrial commission needs to be expanded to a board of 12-to-15 members. For example, in addition to the three members already on the commission, we need to add the following: 1) a medical doctor; 2) an economist; 3) a pastor, priest and two nuns; 4) a biologist; 5) a historian; 6) an archaeologist; 7) at least two Native elders; 8) a cattle rancher; 9) a banker; 10) an ASE-certified mechanic; 11) a philosopher of ethics; 12) an IT/Web-2.0 expert; 13) an English major; 14) a soldier-veteran; 15) and so on. To be quick and short, this would reflect a much greater cross-section of North Dakota society. It is just an idea, nonetheless. And it is unlikely to gain any traction in this legislative session (North Dakota’s 63rd). But perhaps in number 64 or 65.
As promised, here is a distillation of the public profiles of our industrial commission as of March 19, 2013:
Jack Dalrymple, Governor
Born October 16, 1948, Dalrymple grew up in Casselton on the family farm, established in 1875 by his great-grandfather. He graduated with honors from Yale University in 1970 with a bachelor’s degree in American Studies and then returned to North Dakota to manage the farming operations.
Dalrymple came to the North Dakota Legislature in 1985, representing a rural Cass County House district. He served eight terms, including six years as chairman of the House Appropriations Committee. In 2000, he was elected North Dakota’s 35th Lieutenant Governor with Governor John Hoeven and was re-elected in 2004 and 2008. He was elected to his first full term as Governor in 2012.
Dalrymple is a nationally recognized leader in value-added agriculture. He was the founding board chairman of Carrington-based Dakota Growers Pasta Company, the third-largest manufacturer and marketer of dry pasta products in North America. His work in helping to found the company earned him the 2007 Ernst and Young Midwest “Master Entrepreneur of the Year” Award. Dalrymple served as chairman of the North Dakota Trade Office and the Governor’s Commission on Education Improvement.
Wayne Stenehjem, Attorney General
Attorney General Wayne Stenehjem was born in Mohall, North Dakota.  He graduated from the University of North Dakota and received his law degree from the UND School of Law in 1977. 
Stenehjem was elected to the North Dakota House of Representatives in 1976, serving for two terms until his election to the ND Senate in 1980.  He served for twenty years in the Senate until his election to the Office of Attorney General. Stenehjem served on the Judiciary Committee throughout his tenure in the Legislature, and was Chairman of the Senate Judiciary Committee from 1995-2000. He was elected President Pro Tempore of the Senate for the 1999 Legislative Session. In January 2001, Stenehjem was sworn in as the State’s 29th Attorney General. He was reelected in 2004, 2006 and 2010.
Stenehjem is a member of numerous boards and commissions, including the Board of University and School Lands, Industrial Commission (which oversees all state-owned industries including the Bank of North Dakota and the State Mill and Elevator), Drug and Alcohol Commission (chair), Judicial Council and Pardon Advisory Board. 
He was named one of Ten Outstanding Legislators in the US by the Association of Government Employees, and is the recipient of “Champion of the People’s Right to Know” award; SBAND Legislative Service Award; “Friend of Psychology” award; the 2005 North Dakota Peace Officer’s Association’s Lone Eagle Award, was inducted into the Scandinavian American Hall of Fame in 2007, and was named the 2011 Bismarck State College Alumnus of the Year.
Doug Goehring, Agricultural Commissioner
Doug Goehring has been North Dakota Agriculture Commissioner since April 2009 and was elected to a full, four-year term in November 2010.
A third-generation farmer, Commissioner Goehring, along with his son, Dustin, operates a 2,000-acre, no-till farm near Menoken in south central North Dakota, where they raise corn, soybeans, spring wheat, winter wheat, sunflowers, and canola. In the past, the Goehrings have also produced durum, barley, mustard, millet, safflower, alfalfa, lentils and field peas, and have had a feeder cattle operation.
Commissioner Goehring is the former president and chairman of the board of Nodak Mutual Insurance Co. and a director of American Agricultural Insurance Co.
Long active in farm organizations, Commissioner Goehring has served as vice president of the North Dakota Farm Bureau and is a member of the North Dakota Stockmen’s Association, the North Dakota Grain Growers, the North Dakota Soybean Association, the North Dakota Corn Growers Association and the National Association of Corporate Directors. An early supporter of agriculture-based, renewable fuels, he is an investor in the Red Trail Energy Ethanol Plant at Richardton.
Commissioner Goehring is a former director of the United Soybean Board where he served as chairman of the sustainability committee, domestic research committee, industrial uses and international marketing committee. He was a former director of the North Dakota Soybean Council, a former secretary/treasurer of the North Dakota Grain Growers Association and a member of USDA’s Area 4 Research Farm Steering Committee. He is the former president of the Menoken School Board and past chairman of the Bismarck Mandan Chamber Agriculture Committee.
He chairs the Biotechnology Task Force of the National Association of State Departments of Agriculture, and is president of the Midwest Association of State Departments of Agriculture.
Commissioner Goehring attended Bismarck State College and is a licensed medical laboratory technician. He attends Evangel Assembly of God in Bismarck.
Lynn Helms, Director of the North Dakota Industrial Commission Oil and Gas Division
Helms earned his bachelor of science degree in engineering from the South Dakota School of Mines and Technology in 1978, but his oil field career began as a roughneck in 1976 working summers and holidays. After graduation Helms worked for two years as a production engineer for Texaco in all of the producing areas of Montana.
In 1980, Helms joined Amerada Hess in Williston, N.D. While in Williston he worked as a production engineer, reservoir engineer and asset team leader on projects in Abu Dhabi, Alaska, Arkansas, Louisiana, Mississippi, New Mexico, North Dakota, Texas and Wyoming.
http://theedgeofthevillage.com/2013/03/19/revamping-the-north-dakota-industrial-commission/

Published February 21, 2013, 12:00 AM

Industrial Commission upholds Killdeer Mountain drilling decision

BISMARCK — In a unanimous decision on Wednesday, the North Dakota Industrial Commission voted to uphold a recent decision allowing oil drilling in an area in Dunn County near Killdeer Mountain.

By: Bryan Horwath, The Dickinson Press

BISMARCK — In a unanimous decision on Wednesday, the North Dakota Industrial Commission voted to uphold a recent decision allowing oil drilling in an area in Dunn County near Killdeer Mountain.
The IC — comprised of North Dakota Gov. Jack Dalrymple, Attorney General Wayne Stenehjem and Agriculture Commissioner Doug Goehring — voted last month to approve a series of well pad sites to be developed by Hess Corp. Dunn County resident Loren Jepson and his legal counsel, Tom Gehrz of Mackoff Kellogg in Dickinson, filed an appeal of the January IC decision.
Jepson, who was not present at Wednesday’s monthly IC meeting at the State Capitol, had requested the commission take a second look at its decision based on several factors, including the presentation of incorrect information by Director of Mineral Resources Lynn Helms’ office.
“We were asked to reconsider order 20920 and the response is a recommendation to deny that request for reconsideration,” Helms told the commission before its vote. “The grounds that the appeal was brought on don’t meet the legal test for a reconsideration.”
Jepson and other Killdeer Mountain drilling opponents had requested that Hess drill in a different area near the pad sites in question, although Helms said such a move would create new mineral rights issues for landowners.
The land in question could hold as much as 3.5 millions barrels of oil, according to DMR estimates. Wednesday’s decision does not mean Jepson is out of options as far as appealing Hess’ drilling, but any future appeals would need to be brought in District Court.
An opposition to the drilling of up to eight wells near the sacred Native American destination Medicine Hole developed last year. A number of individuals voiced concerns ranging from added local truck traffic to wildlife management in the area and oil exploration encroachment into an area where Native American artifacts are known to have been found. In its decision last month, the IC added stipulations to its approval of the development of the land.
Hess must make an attempt to limit the flaring of natural gas on well sites and must alert the State Historical Society prior to site construction so an independent archeologist can check for artifacts, according to the IC’s original decision. Also, hydraulic fracturing can only occur in the area during the summer so as not to cause safety concerns with truck and school bus traffic on rural roads.
“I’m obviously disappointed with the decision,” Jepson said. “The thing that is most disappointing is that I didn’t even know there was a meeting (Wednesday). I think the story is that that the commission doesn’t let people know what they’re doing and what they’re talking about at these meetings.”
Gehrz sent a letter requesting that Jepson’s Killdeer Mountain appeal be heard at a later meeting. In his appeal, Jepson had also stated concerns that Helms was in a position of bias in his recommendation to the IC, an accusation rebuffed by Goehring.
“I cannot say that I have found at one time where (Helms) has approached us with a bias,” Goehring said. “Mr. Helms has given us options and provided pros and cons of situations. Still, we have to consider how we fulfill our obligations and duties.”
Goehring and Stenehjem stated that the time to provide information and evidence against drilling on the sites in question was before the matter came to the IC.
“I’m happy with the commission’s decision,” Helms said. “I truly believe that the right decision was made in this case. The grounds weren’t there to reconsider this case.
“Originally, this case was on the September (DMR hearing) docket and we continued it a month so that people could secure legal counsel and do research and come to the hearing prepared,” he said. “We actually re-opened the record for some additional written documents based on some archeological concerns and Hess’ plans around timing of the drilling. Normally, we wouldn’t do that. We really took our time with this case.”

http://www.thedickinsonpress.com/event/article/id/65904/

Industrial commission rejects Killdeer drilling request

February 20, 2013 4:55 pm  •  By BRIAN GEHRING | Bismarck Tribune

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The North Dakota Industrial Commission on Wednesday denied a Killdeer Mountains landowner’s request to reconsider a permit granted by the commission in January to drill eight new oil wells by Hess Corp.

Loren Jepson filed a request with the commission Feb. 7, saying among other things, state Mineral Resources Director Lynn Helms was biased in his recommendation to approve the new wells in an area where four already have been approved.

Hope Hogan, an assistant attorney general for the state, told the commission none of Jepson’s four reasons for requesting reconsideration were valid under state law.

Jepson’s attorney, Thomas Gehrz, said he was not given advanced notice of Wednesday’s meeting and requested a delay in a letter to the commission.

State Attorney General Wayne Stenehjem said the meetings are public record and notification is not required.

A second reason Jepson cited was not being given an opportunity to respond to testimony at a Jan. 24 meeting when the commission granted the permit.

Stenehjem said public comment was accepted at that meeting because of the high profile nature of the area in question.

Other contentions from Jepson that the commission did not follow proper procedure for allowing evidence in the matter and that Helms was biased also were rejected.

Neither Jepson nor his attorney were at Wednesday’s meeting.

Reach reporter Brian Gehring 250-8254 or brian.gehring@bismarcktribune.com.

The Killdeer Mountains: Living History and Sacredness

01/25/2013

The Killdeer Mountains: Living History and Sacredness

By Aaron Barth

Individuals concerned about what happens to the Killdeer Mountains chat before the public hearing at the Bismarck capitol on January 24, 2013.

The Killdeer Mountains in Dunn County, western North Dakota have been getting a lot of attention lately, especially after theNorth Dakota Industrial Commission decided to, well, industrialize the area, and allow the Hess Corporation to follow through with signed leases and drill and frack for oil there. The Grand Forks Herald reported on it here, and The Bismarck Tribune here. The Industrial Commission is composed of three individuals, including Jack Dalrymple, Wayne Stenehjem, and Doug Goehring. They have scheduled meetings with the Department of Mineral Resources and Lynn Helms, the sitting Director. It is important to remember that this was a public hearing, and at public hearings the public ought not to be shy about attending. This experiment America has going, our Democratic-Republic, necessitates these local meetings that have global implications.

On January 24, 2013, at 1:00pm (CST) the public hearing for the Killdeer Mountains was held in the capitol of Bismarck, North Dakota. It was Industrial Commission Case Number 18618 concerning sections 25 & 36, T. 146 N., R. 97 W, this about 30-35 miles north of Dickinson, North Dakota. Originally the hearing was scheduled in the Governor’s meeting room, a rather closed-off and secluded place. Because of the public turn-out, though, the hearing was relocated to the larger Brynhild Haugland room in the western wing of the capitol. I drove over from Fargo to Bismarck to attend the meeting, and while there scribbled down some notes and took some audio-video as well. The high-points, I thought, were in capturing two Native voices from two disparate cultures.

The first is a video from Theodora Birdbear of Mandaree, North Dakota (Mandaree is Mandan, Hidatsa and Arikara territory). The microphone on my Canon PowerShot SX260 HS captured the audio a bit, and just in case there are those of us hard-of-hearing, I provided transcript of Theodora’s testimony below.


Transcript:

…and he expressed the impact of oil and gas development, the industrialization of an area, which impacts the quality of that spiritual experience. I guess it’s kind of equivalent to having an oil well right beside your Catholic church or something. It’s parallel to that. So I wanted the commission to know that Fort Berthold does have a living connection to that area, and to consider that in your decision making. As people have said prior to this, technology is evolving, and to keep it [oil] in the ground is not wasting it. They are going to be after it in the future. What’s the rush? The rush is quick decisions, unplanned decisions, and unplanned impacts. So I just wanted to make a comment about our relationship with that area. It is still living today.

North Dakota Industrial Commissioners listen to Natives speak about the sacredness and history of the Killdeer Mountains.

Theodora remarks on how the Killdeer Mountains are a sanctuary, as sacred and sacrosanct as a Catholic Church, and to carry the analogy further, as a Lutheran or protestant church, a Synagogue, a Mosque, a Buddhist monastery, a Hindu temple, a Confucian temple, and so on. These spaces are sacrosanct in the sense that when an individual goes to the area to pray, they are really interested in having it as quiet. A library could also be considered a sacred space by this definition (libraries carry on that monastic-academic tradition of the deliberate contemplation of texts — this is arguably the antithesis of our hyper-industrial, full-throttle, 21st century world).

The other Native voice captured came by way of Dakota Goodhouse, who originally hails from the Standing Rock Sioux Reservation in south-central North Dakota (he shares the namesake of the state, which in English means ally or friend). Dakota gives some backdrop about the history of Killdeer Mountains as it pertains to the US-Dakota Wars, specifically the punitive campaigns carried out by General Alfred Sully west of the Missouri River circa 1864.
For some video context, Dakota is speaking and Lynn Helms is seated at the right. In this video excerpt, Dakota is remarking on how the encampment and battle boundaries are much larger and broader than what is delineated now (as of 01/25/2013), and how they need to be re-considered.

http://theedgeofthevillage.com/2013/01/25/killdeer-mountains-living-history-and-sacredness/