North Dakota Must Face Landowner Mineral Rights Lawsuit

North Dakota must face a lawsuit by landowners who accuse the state of usurping oil and mineral rights worth millions of dollars.

Williams County District Court Judge David W. Nelson rejected Attorney General Wayne Stenehjem’s request to dismiss the suit, according to a copy of the decision provided by the landowners’ lawyer. Yesterday’s ruling couldn’t be immediately confirmed in online court records.

Owners of land next to North Dakota’s navigable rivers and lakes contend they own the mineral rights between the high and low water marks. State officials countered that the issue of ownership is at best unclear.

“The Supreme Court of North Dakota has not had occasion to consider the question of who has the right to the minerals under the shore zone,” Nelson wrote. That issue must be resolved before the court addresses the landowners’ claims that their land is being taken unlawfully.

North Dakota, the third-smallest U.S. state by population with 672,591 residents as of 2010, is ranked second in crude oil output. Only Texas, with 54.4 million barrels, produced more crude oil in March than North Dakota’s 17.8 million barrels, according to U.S. Energy Information Administration data.

Nelson heard arguments on the state’s dismissal motion on June 12 at a courthouse in Williston, 70 miles from the Canadian border.

Three Lawsuits

Three similar cases are now pending in the Williams County court, the judge said in his ruling. Counsel should confer on which one should go forward on the common issue of shore-zone ownership rights, he said.

Liz Brocker, a spokeswoman for Stenehjem, didn’t respond to an e-mail seeking comment yesterday after regular business hours on the ruling.

“It’s an important order in that he’s left our claims intact,” Jan Conlin, a lawyer for the landowners, said in a phone interview. She called Nelson’s decision to decide the shore zone rights issue first “an appropriate way to proceed.”

The case is Reep v. State of North Dakota, 53-2012- CV-00213, District Court of North Dakota, Northwest Judicial Circuit (Williston).

To contact the reporter on this story: Andrew Harris in Chicago at aharris16@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.