23.0282.03000
Sixty-eighth
Legislative Assembly SENATE BILL NO. 2317
of North Dakota
Introduced by
Senator Magrum
1 A BILL for an Act to amend and reenact sections 38-25-05, 38-25-06, and 38-25-07 of the North
2 Dakota Century Code, relating to the amalgamation of the underground storage of oil and gas;
3 to repeal section 38-25-08 of the North Dakota Century Code, relating to amalgamating
4 property interests; and to declare an emergency.
5 BE IT ENACTED BY THE LEGISLATIVE ASSEMBLY OF NORTH DAKOTA:
6 SECTION 1. AMENDMENT. Section 38-25-05 of the North Dakota Century Code is
7 amended and reenacted as follows:
8 38-25-05. Permit requirements - Storage in oil and gas reservoir.
9 Before issuing a permit for storage in an oil and gas reservoir, the commission shall find:
10 1. The storage operator has or will obtain the consent by lease, purchase, or other
11 agreement from all surface owners where surface disturbance activities are necessary
12 and surface facilities will be located.
13 2. The storage operator has complied with all requirements set by the commission.
14 3. The storage facility is suitable and feasible for the injection, storage, and withdrawal of
15 oil or gas.
16 4. The storage operator has made a good-faith effort to get the consent of all persons
17 that own the storage reservoir's pore space.
18 5. The storage operator has made a good-faith effort to obtain the consent of all persons
19 that own oil and gas minerals and oil and gas leases.
20 6. The storage operator has obtained the consent of persons that own at least
21 fifty-fiveeighty-five percent of the storage reservoir's pore space unless the percentage
22 required to unitize the oil and gas unit is otherwise provided for by order of the
23 commission before August 1, 2021, in which case the percentage in the order required
24 to pool the mineral interests prevails as to the percentage of pore space owners from
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Sixty-eighth
Legislative Assembly
1 whom the storage operator must obtain consent. If a county elects to require written
2 consent from more than eighty-five percent of the persons that own the storage
3 reservoir's pore space, the storage operator has received written consent from the
4 specified percentage of the owners required by the county.
5 7. The storage operator has obtained the consent of persons that own at least fifty-five
6 percent of the storage reservoir's oil and gas minerals and oil and gas leases unless
7 the percentage required to unitize the oil and gas unit is otherwise provided for by
8 order of the commission before August 1, 2021, in which case the percentage in the
9 order prevails.
10 8. Whether the storage reservoir contains any commercially valuable oil, gas, or other
11 minerals and, if it does, a permit may be issued only if the commission is satisfied the
12 interests of the mineral owners or mineral lessees will not be affected adversely or
13 have been addressed in an arrangement entered by the mineral owners or mineral
14 lessees and the storage operator.
15 9. The proposed storage facility will not affect adversely surface waters or formations
16 containing fresh water.
17 10. The injected oil or gas will not escape from the storage reservoir.
18 11. The storage facility will not endanger health or unduly endanger the environment.
19 12. The storage facility is in the public interest.
20 13. The vertical boundaries of the storage reservoir are defined to include any necessary
21 or reasonable buffer zones for the purpose of ensuring the safe operations of the
22 storage facility and to protect the storage facility against pollution, invasion, and
23 escape or migration of oil or gas therefromfrom the storage facility.
24 14. The horizontal extent of the injected gas within the storage reservoir, as estimated by
25 reasonable means and confirmed through appropriate monitoring methods, are
26 defined to include any necessary or reasonable buffer zones for the purpose of
27 ensuring the safe operations of the storage facility and to protect the storage facility
28 against pollution, invasion, and escape or migration of oil or gas therefromfrom the
29 storage facility.
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1 15. The storage operator will establish monitoring facilities and protocols to assess the
2 location and migration of oil and gas, if any, injected for storage and to ensure
3 compliance with all permit, statutory, and administrative requirements.
4 16. The method of underground storage is reasonably necessary to effectively carry on
5 the joint effort, will prevent waste, protect correlative rights of the mineral and surface
6 estate, and, with reasonable probability, will result in the increased storage and
7 recovery of more oil and gas.
8 17. The time, conditions, and method by which the storage facility must be dissolved and
9 the facility's affairs wound up. A storage facility may be dissolved ten years after the
10 storage facility permit is issued upon a petition to the commission by the pore space
11 owners and mineral owners that are credited with at least the percentage of interest of
12 the pore space required to ratify the storage facility amalgamation agreement, and a
13 subsequent hearing and order by the commission.
14 18. All nonconsenting owners are or will be compensated equitablyhave received just
15 compensation under chapter 32-15 and section 16 of article I of the Constitution of
16 North Dakota or the district court has authorized the plaintiff to take possession under
17 section 32-15-29.
18 SECTION 2. AMENDMENT. Section 38-25-06 of the North Dakota Century Code is
19 amended and reenacted as follows:
20 38-25-06. Permit requirements - Storage in saline reservoir or aquifer.
21 Before issuing a permit for storage in a saline reservoir or aquifer, the commission shall
22 find:
23 1. The storage operator has or will obtain the consent by lease, purchase, or other
24 agreement from all surface owners where surface disturbance activities are necessary
25 and surface facilities will be located.
26 2. The storage operator has complied with all requirements set by the commission.
27 3. The storage facility is suitable and feasible for the injection, storage, and withdrawal of
28 oil or gas.
29 4. The storage operator has made a good-faith effort to obtain the consent of all persons
30 that own the storage reservoir's pore space.
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1 5. The storage operator has obtained the consent of persons that own at least
2 sixtyeighty-five percent of the storage reservoir's pore space. If a county elects to
3 require written consent from more than eighty-five percent of the persons that own the
4 storage reservoir's pore space, the storage operator has received written consent from
5 the specified percentage of the owners required by the county.
6 6. The proposed storage facility will not affect adversely surface waters or formations
7 containing fresh water.
8 7. The injected oil or gas will not escape from the storage reservoir.
9 8. The storage facility will not endanger health or unduly endanger the environment.
10 9. The storage facility is in the public interest.
11 10. The vertical boundaries of the storage reservoir are defined to include any necessary
12 or reasonable buffer zones for the purpose of ensuring the safe operations of the
13 storage facility and to protect the storage facility against pollution, invasion, and
14 escape or migration of oil or gas therefromfrom the storage facility.
15 11. The horizontal extent of the injected gas within the storage reservoir, as estimated by
16 reasonable means and confirmed through appropriate monitoring methods, are
17 defined to include any necessary or reasonable buffer zones for the purpose of
18 ensuring the safe operations of the storage facility and to protect the storage facility
19 against pollution, invasion, and escape or migration of oil or gas therefromfrom the
20 storage facility.
21 12. The storage operator will establish monitoring facilities and protocols to assess the
22 location and migration of oil and gas, if any, injected for storage and to ensure
23 compliance with all permit, statutory, and administrative requirements.
24 13. The method of underground storage is reasonably necessary to effectively carry on
25 the joint effort, will prevent waste, protect correlative rights of the mineral and surface
26 estate, and, with reasonable probability, will result in the increased storage and
27 recovery of more oil and gas.
28 14. The time, conditions, and method by which the storage facility must be dissolved and
29 the facility's affairs wound up. A storage facility may be dissolved ten years after the
30 storage facility permit is issued upon a petition to the commission by the pore space
31 owners and mineral owners that are credited with at least the percentage of interest of
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1 the pore space required to ratify the storage facility amalgamation agreement, and a
2 subsequent hearing and order by the commission.
3 15. All nonconsenting pore space owners are or will be compensated equitablyhave
4 received just compensation under chapter 32-15 and section 16 of article I of the
5 Constitution of North Dakota or the district court has authorized the plaintiff to take
6 possession under section 32-15-29.
7 SECTION 3. AMENDMENT. Section 38-25-07 of the North Dakota Century Code is
8 amended and reenacted as follows:
9 38-25-07. Permit requirements - Storage in salt cavern.
10 Before issuing a permit for storage in a salt cavern, the commission shall find:
11 1. The storage operator has or will obtain the consent by lease, purchase, or other
12 agreement from all surface owners where surface disturbance activities are necessary
13 and surface facilities will be located.
14 2. The storage operator has complied with all requirements set by the commission,
15 including all necessary permits to conduct solution mining, if applicable.
16 3. The storage facility is suitable and feasible for the injection, storage, and withdrawal of
17 oil or gas.
18 4. The storage operator has made a good-faith effort to obtain the consent of all persons
19 that own the salt cavern's pore space.
20 5. The storage operator has made a good-faith effort to obtain the consent of all persons
21 that own the salt cavern's salt minerals and salt leases.
22 6. The storage operator has obtained the consent of persons that own at least
23 sixtyeighty-five percent of the salt cavern's pore space. If a county elects to require
24 written consent from more than eighty-five percent of the persons that own the salt
25 cavern's pore space, the storage operator has received written consent from the
26 specified percentage of the owners required by the county.
27 7. The storage operator has obtained the consent of persons that own at least fifty-five
28 percent of the salt cavern's salt minerals and salt leases.
29 8. The proposed storage facility will not affect adversely surface waters or formations
30 containing fresh water.
31 9. The injected oil or gas will not escape from the salt cavern.
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1 10. The storage facility will not endanger health or unduly endanger the environment.
2 11. The storage facility is in the public interest.
3 12. The horizontal and vertical boundaries of the salt cavern are defined to include a
4 buffer zone from the outer walls of the cavern for the purpose of ensuring the safe
5 operation of the storage facility and to protect the storage facility against pollution,
6 invasion, and escape or migration of gas therefromfrom the storage facility.
7 13. The storage operator will establish monitoring facilities and protocols to assess the
8 location and migration of oil and gas, if any, injected for storage and to ensure
9 compliance with all permit, statutory, and administrative requirements.
10 14. The method of underground storage is reasonably necessary to effectively carry on
11 the joint effort, will prevent waste, protect correlative rights of the mineral and surface
12 estate, and, with reasonable probability, will result in the increased storage and
13 recovery of more oil and gas.
14 15. The time, conditions, and method by which the storage facility must be dissolved and
15 the facility's affairs wound up. A storage facility may be dissolved ten years after the
16 storage facility permit is issued upon a petition to the commission by the pore space
17 owners and mineral owners that are credited with at least the percentage of interest of
18 the pore space required to ratify the storage facility amalgamation agreement, and a
19 subsequent hearing and order by the commission.
20 16. That allAll nonconsenting owners are or will be equitably compensatedhave received
21 just compensation under chapter 32-15 and section 16 of article I of the Constitution of
22 North Dakota or the district court has authorized the plaintiff to take possession under
23 section 32-15-29.
24 SECTION 4. REPEAL. Section 38-25-08 of the North Dakota Century Code is repealed.
25 SECTION 5. EMERGENCY. This Act is declared to be an emergency measure.
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Statutes affected: INTRODUCED: 38-25-05, 38-25-06, 38-25-07, 38-25-08