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Oil Industry Not Compensating Ranchers for Lost Productivity, Water, Dust

I'd say that a handful of our legislators are off gallivanting around the state on the taxpayers' dime... but I don't think you can consider a trip to Harding County "gallivanting." The interim oil and gas study committee is off to northwestern South Dakota to conduct public hearings on what the North Dakota oil boom might do to South Dakota if the Bakken bonanza slips south.

Kevin Woster finds Harding County sheep wrangler Tim Brown already feeling the costs outweighing the benefits, due to a separation between surface rights and mining rights:

Tim Brown figures he is down about 500 sheep on his Harding County ranch.

In this case, it isn't because of coyotes. It's because of oil....

Brown said [the separation of surface rights and mining rights] leads to damages from oil-related activities that reduce the productivity of his pastures, often without providing him financial compensation in return.

"I'm running about 500 less sheep now than I once did," he said. "And at today's prices, that's substantial. And I'm getting nothing back from that."

..."[Ranchers] have very little recourse now," he said. "They have to let these companies on to do exploration. And they basically get one check, and then, if they are aggrieved, they have to go to court. And usually that's not really worth it."

That's Brown's situation. He has mineral rights under about 160 acres of 6,000 owned, and 16 wells producing oil or water for water-injection processes used in the oil recovery.

Without holding the mineral rights, most surface owners get a one-time settlement for damage caused by oil operations, Brown said. After that, it's a process of negotiation.

"If you negotiate and an oil company feels generous, you possibly could get something," he said [Kevin Woster, "Rancher Feels Impacts of Oil and Gas Development Without Financial Returns," Rapid City Journal, 2012.07.16].

Isabel Senator Ryan Maher tried to rectify that surface-mining rights disjunction with Senate Bill 97 this year, but Senate Commerce and Energy narrowly killed that bill. Senator Tom Nelson will have a chance to explain his opposition to that bill to the Harding County ranchers today.

Note the point about water usage. Oil exploration will slurp up a lot of water and render it unfit for critter consumption. That will make it harder to ranch.

Also impacting ranching—dust:

The damages caused by the operation on the surface are "hard to explain" to people who don't ranch, he said. Although not catastrophic, the impacts add up, he said.

They include all of the disruptions from truck activity — including the negative effects of dust on pasture grass and livestock that eat it — and pipeline and power line construction and maintenance make the land less productive, he said [Woster, 2012.07.16].

Again, I have to point out that Rep. Kristi Noem was telling us dust is just a part of rural life and that it doesn't hurt anyone. Maybe Brown should invite Rep. Noem out for some dusty salad.

5 Comments

  1. Dougal 2012.07.16

    These legislators, hopefully, will be smarter than the Public Utilities Commission when it bent over to let Keystone XL screw over landowners with unwarranted eminent domain actions in South Dakota.

    They should be careful to protect public safety from some of the hardships allowed to happen in North Dakota. Number 1 rule: Never trust an oil corporation. Number 2 rule: You are not elected (maybe bankrolled) by oil corporations, you are elected by the people who expect their safety and economic welfare to be protected against predatory corporate greed. Number 3 rule: Never forget rules 1 and 2, or you will be thrown out.

    This article over the weekend by Amy Dalrymple (who’s done very worthy work reporting on the Bakken oil rush) got my attention: http://www.dl-online.com/event/article/id/68776/

    --------------------------------------
    WILLISTON, N.D. — Residents of one of Williston’s newest neighborhoods now have an up-close view of a drilling rig.
    Statoil is drilling four wells in northwest Williston, adjacent to many new homes and a developing residential area.
    For Fargo man Chuck Horejsi, who is renting a room in a house near the rig this summer, seeing the derrick from his bedroom window is unusual.
    “Only in Williston,” Horejsi said, laughing. “I can’t believe they put an oil rig in the backyard.”
    ---------------------------------------

    Check it out. And there is this one by Lauren Donovan (for Bismarck Tribune, also great reporting) calling attention to the net impact of an oil rush on those who endure the expense of the rush: http://bismarcktribune.com/bakken/kunze-township-says-it-s-not-fair-to-pay-for/article_4df3dcaa-ce30-11e1-9994-001a4bcf887a.html

    I’ll keep an open mind to whether these legislators will choose to serve our citizens instead of bending over for greedy corporations. A corporation’s bottom line is not public service, but the Almighty Dollar. An elected official’s bottom line is public service and protection.

    Ask the hard questions. Demand full answers and proof. Don’t be a bunch of patsies. We don't need more poor decisions like Keystone XL and Anderson Seed Company.

  2. Chris Studer 2012.07.16

    For anyone in that area that's interested, South Dakota Farmers Union is hosting a series of meetings next week focused on protecting landowners and educating them on what to do if oil developers come calling...what to do about contracts...severed mineral rights and how to get them back. You can read more here: http://www.sdfu.org/events/view-event/id/176/date/1343023200

  3. Dougal 2012.07.16

    Thank goodness for S.D. Farmers Union for keeping landowners in touch with their rights and their options.

  4. shamrock 2012.07.16

    Nice "Senator" Nelson was there considering he lost 2-1 in the primary and will not be returning to Pierre. Let it go Tom, let it go.

  5. Les 2012.07.17

    One of the major reasons the state refuses to allow passage of Sen Mahers bill in my opinion, the state is one of the largest owners of mineral rights. And by golly they don't feel they have enough to share with their constituents who bare the pain of companies trampling on their private property.

    As to the legislators who vote against their constituents in cases like this or requiring mineral owners to share the tax burden with the land owner..........

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