Federal rules would slow Fort Berthold oil development, officials say

NEW TOWN, N.D. – Federal red tape and redundant regulations threaten to slow oil development on the Fort Berthold Indian Reservation, tribal officials and industry leaders said Tuesday.

Tex Hall, chairman of the Mandan Hidatsa Arikara Nation, said the tribes oppose federal rules announced Friday that will require companies drilling for oil and gas on public and Indian lands to publicly disclose chemicals used in hydraulic fracturing.

Hall, who gave the opening comments Tuesday during the MHA Bakken Oil and Gas Expo, said he’s not opposed to disclosing the chemicals, but the proposed federal rules go too far and will slow down the permitting process.

“We shouldn’t be held up by federal obstacles or federal red tape,” Hall said. “These rules are severely impacting the bigger economy at Fort Berthold.”

Terry Kovacevich, an asset manager for Marathon Oil in Dickinson, N.D., echoed Hall’s comments during a presentation Tuesday afternoon.

Kovacevich said the proposed federal fracking rules duplicate what the state already has in place and will slow down oil development.

“All of this will drive development away from the reservation,” Kovacevich said.

Already, the Bureau of Land Management can’t keep up with approving drilling permits on tribal land, and this extra requirement will create further delays, Kovacevich said.

Rick Hotaling, acting North Dakota field manager for the federal Bureau of Land Management, said the rule was amended to require the fracking chemical disclosure after completion of the well, rather than before, in response to industry comments.

The Bureau of Land Management office in Dickinson has had a high turnover rate after many employees left to work for oil companies, Hotaling said.

When Hotaling arrived at the Dickinson office in February, there were 450 drilling applications pending, and 238 were from Fort Berthold, he said.

To catch up, the bureau has established a “strike team” in Miles City, Mont., where employees from around the country could find lodging, to address the backlog of permits and train the new hires, Hotaling said.

They will continue that approach until the office can get caught up, he said.

Chairman Hall also said he’s sending a written request to Gov. Jack Dalrymple asking to renegotiate an agreement the tribes have with the state regarding oil tax revenue generated on the reservation.

Hall said the agreement is unfair and the tribe should be receiving a greater share.

“We already asked him but nothing happened,” Hall said. “We’re not going away.”

Dalrymple, in a phone interview after the conference, said he has appointed legal counsel in his office to discuss the issue with tribal officials.

However, changing the rule would require legislative approval, not just action from his office, Dalrymple said.

“Everybody signed it originally. They think that some of the details of it could be more fair, I guess,” Dalrymple said. “We are certainly open to talking to them about that.”

Hall also called on oil companies to share the responsibility of maintaining the roads.

Last year, the tribe spent $9.5 million on roads and the tribe and its members were not responsible for that amount of damage, Hall said.

“We can’t afford to pay for everything,” he said.

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