The last thing anyone expected at Wednesday’s North Dakota Industrial Commission meeting was a motion made by Wayne Stenehjem, a second by Agriculture Commissioner Doug Goehring, and a unanimous vote of approval by the two of them and Jack Dalrymple. But that’s what happened. Nor was the motion quite what we expected, but for now, it’ll do.
The meeting was called to discuss Stenehjem’s “Special Places” proposal—his idea to draft an administrative rule developing a list of places where we need to be more careful when we site oil well facilities, and directing oil companies to work with state agencies in the siting process. It was a hastily called meeting and no one was really sure what to expect. Although we didn’t expect anything dramatic, because Agriculture commissioner Doug Goehring was in Africa and could only participate by phone.
I’ve got to say, the Attorney General made a lot of us nervous when he started the discussion, and it appeared he was backing away from his proposal. Turns out he was being a practical politician. Politics is the art of compromise, the art of the possible. Wayne’s been around the capitol since 1976, having been elected to the Legislature at the ripe old age of 23, while he was still in law school. He knows how North Dakota government works, and he knows and understands the players.
So he started out by saying there’s a difference between a formal administrative RULE and a formal agency POLICY, and that perhaps we would be better off adopting a formal policy as to how oil drilling permits would be issued. Stenehjem’s idea, reinforced by Dalrymple, would still include the adoption of a list of those what he calls “extraordinary places,” and as each drilling permit application came in, it would be the job of someone in the Department of Mineral Resources, serving as a sort of “ombudsman” to look at each one, and if one of them was in or near one of these places, it would get some extra attention from state government. The ombudsman would send the application to someone in one of our agencies who would work with the company to determine the best location of the well pad and the roads to it, and measures the company could take to mitigate any potential disturbance in the area as the result of the well. As Dalrymple pointed out at a meeting last month, that happens a lot now, but we don’t have a formal process to GUARANTEE that it happens. That’s what Stenehjem’s proposal would do.
All the time Stenehjem was explaining his idea, Dalrymple was nodding in assent. When it came time for Dalrymple to speak, Stenehjem was nodding as Dalrymple said “What you have brought to us is worthwhile.”
And Dalrymple seemed almost eager to get a motion on the table, asking Wayne to do so. Wayne did. They waited for Goehring, on the phone, to make a second. No response. “Doug, are you there?” he asked into the speakerphone of an Agriculture Commission half a planet away. “You have to take your phone off mute.”
“I’m here,” Goehring finally replied.
“I thought maybe my voice had put you to sleep,” said Dalrymple. Somebody behind me muttered “Jack’s voice always makes me sleepy.”
“I’ll second the motion,” Goehring said from Africa. Unanimous vote. How about that?
Then details were discussed a little bit. Wayne’s staff will work out a formal document for the group to consider at a future meeting, maybe even as soon as next week, but more likely next month. We’ll see if Dalrymple and Goehring like Stenehjem’s wording. If so, game on, an ombudsman is hired (to be honest, it’s probably going to really take a small staff of 2 or 3 to get this all done in a timely manner so the oil companies don’t feel like they’re being delayed—not that there’s anything wrong with that) and the process begins.
So, how do people who have been supportive of Stenehjem’s idea feel about this change in course? Well, I haven’t had much discussion, although I suppose I will, but I can weigh in. It’s my blog. As soon as the meeting was over, I walked over to talk to Ron Ness, head of the North Dakota Petroleum Council. “Well, does this get rid of the need for litigation?” I asked. “Well, that’s where it was headed,” he replied. “Fire the lawyers,” I said as we parted company.
Nobody, including me, has really wanted to talk about that, but it’s been in the back of a lot of people’s minds the past month or so. There’s been the threat that once a rule was promulgated, the oil industry would file a lawsuit to block it from taking effect, and that could take months, maybe years, to settle in the courts, and the Industrial commission would go right on approving 200 or 300 drilling permits a month, with no formal process in place at all dealing with these special places. It’s already been a year since Stenehjem first broached this idea at last January’s Industrial Commission meeting, and we’ve issued a few thousand drilling permits since then with no review process in place. With a lawsuit holding up this process, we’d issue a few thousand more.
We’ve had a good sense something like that is coming because a Bismarck law firm, no doubt on behalf of a client in the oil industry, has filed an open records request asking for all of Wayne’s correspondence and e-mails regarding this special places proposal. So somebody’s getting ready to sue somebody, most likely the Industrial Commission, in an effort to stop these new rules from taking effect if the Commission were to adopt them. (Disclosure: they’re going to find an e-mail in there from me saying, in some idle chat, that I voted for Wayne, so I might as well get that out there right now so my Democrat friends aren’t surprised.)
Adopting a policy, which might have some flexibility, instead of a rule, which has the force of law, might mollify the industry enough to get them to back off and even support this idea. I hope so. Wayne’s not trying to stop anyone from drilling a well and getting their minerals. Jack is certainly not going to let him do that. He’s in too deep with the industry to let that happen. But providing a process by which the industry could use the expertise of our state agencies to help them find the best places to put their oil wells just makes so much sense that I can’t understand why anyone would be against it.
But then, I’ve been tilting at windmills all my life, some of my friends say. I’m for universal, single payer health insurance too. So what do I know?