North Dakota oil and gas laws can be found in Chapter 38-08, Title 38 of North Dakota Century Code. Pursuant to N.D. Cent. Code, § 38-08-03, waste of oil and gas is prohibited.
Powers and Jurisdiction of the Commission
Pursuant to N.D. Cent. Code, § 38-08-04, the commission has continuing jurisdiction and authority over all persons and property, public and private, necessary to enforce effectively the provisions of the statute. The commission has authority and it is its duty to make such investigations as it deems proper to determine whether waste exists or is imminent or whether other facts exist which justify action by the commission.
The commission has the authority to require:
- Identification of ownership of oil or gas wells, producing leases, tanks, plants, structures, and facilities for the transportation or refining of oil and gas.
- The making and filing with the industrial commission of all resistivity, radioactivity, and mechanical well logs and the filing of directional surveys, if taken, and the filing of reports on well location, drilling, and production.
- The drilling, casing, operation, and plugging of wells in such manner as to prevent the escape of oil or gas out of one stratum into another, the intrusion of water into oil or gas strata, the pollution of freshwater supplies by oil, gas, or saltwater, and to prevent blowouts, cavings, seepages, and fires.
- The operation of wells with efficient gas-oil and water-oil ratios, and to fix these ratios.
- Certificates of clearance in connection with the transportation or delivery of oil, gas, or any product.
- Metering or other measuring of oil, gas, or product related to production in pipelines, gathering systems, storage tanks, barge terminals, loading racks, refineries, or other places, by meters or other measuring devices approved by the commission.
- Every person who produces, sells, purchases, acquires, stores, transports, refines, disposes of, or processes oil, gas, saltwater, or other related oilfield fluids must keep and maintain complete and accurate records of the quantities and such records must be available for examination by the commission or its agents at all reasonable times.
Regulations
Pursuant to N.D. Cent. Code, § 38-08-04, the Commission regulates the following:
- drilling, producing, and plugging of wells, the restoration of drilling and production sites, and all other operations for the production of oil or gas.
- shooting and chemical treatment of wells.
- spacing of wells.
- operations to increase ultimate recovery such as cycling of gas, the maintenance of pressure, and the introduction of gas, water, or other substances into producing formations.
- disposal of saltwater and oilfield wastes.
- underground storage of oil or gas.
- limits and allocates the production of oil and gas from any field, pool, or area and to establish and define as separate marketing districts those contiguous areas within the state which supply oil and gas to different markets, and to limit and allocate the production of oil and gas for each separate marketing district.
- adopts and enforces rules and orders to effectuate the purposes and the intent of the statute and the commission’s responsibilities
- provides for the confidentiality of well data reported to the commission if requested in writing by those reporting the data for a period not to exceed six months.
Civil Actions
Pursuant to N.D. Cent. Code, § 38-08-17, if a person violates or threatens to violate any provision, or any rule, regulation, or order of the commission, the commission will bring suit against such person in the district court of any county where the violation occurs or is threatened, to restrain such person from continuing such violation or from carrying out the threat of violation.
Appeals
Pursuant to N.D. Cent. Code, § 38-08-14, any party adversely affected by an order entered by the commission may appeal from the order of the district court for the county in which the oil or gas well or the affected property is located. However, if the oil or gas well or the property affected by the order is located in or underlies more than one county, any appeal may be taken to the district court for any county in or under which any part of the affected property is located.
Penalties
Pursuant to N.D. Cent. Code, § 38-08-16(1), any person who violates any provision or any rule, regulation, or order of the commission is subject to a civil penalty to be imposed by the commission up to twelve thousand five hundred dollars for each offense, and generally each day’s violation is a separate offense.
If the penalties are not paid, they are recoverable by suit filed by the attorney general in the name and on behalf of the commission. However, the payment of the penalty may not operate to legalize any illegal oil, illegal gas, or illegal product involved in the violation for which the penalty is imposed, or to relieve a person on whom the penalty is imposed from liability to any other person for damages arising out of the violation[i].
Generally, a person who willfully violates any provision or any rule or order of the commission that pertains to the prevention or control of pollution or waste is guilty of a class C felony[ii].
[i] N.D. Cent. Code, § 38-08-16(1).
[ii] N.D. Cent. Code, § 38-08-16(2).
