This week, the state of North Dakota, the nation’s second-largest oil producer behind Texas, filed a lawsuit against the Biden administration for halting oil and gas leases on public lands.
U.S. Senator Kevin Cramer (R-ND), who had introduced legislation to prohibit the Biden administration from blocking energy or mineral leasing and permitting on federal lands and waters without Congressional approval, reacted to the lawsuit by stating:
In addition to being a foolish idea, President Biden’s moratorium on oil and gas leasing on public lands is illegal. It increases federal and state budget shortfalls, hampers state and private mineral owners’ rights, and makes the United States less energy independent and more reliant on foreign producers who are not all good actors like Russia, Saudi Arabia, or Venezuela. I support Attorney General Stenehjem’s effort in court, applaud him for standing up for North Dakota, and stand ready to help in any way I can.
The state pointed out in its lawsuit:
Oil and gas production are central to North Dakota’s economy and the welfare of citizens, responsible for 54% of the value of the State’s economy, generating approximately 76% of the State’s tax revenue and creating approximately 66,000 good-paying jobs in the State. Oil and gas produced from leases on Federal and Indian lands in North Dakota are an important part of this sector, generating approximately $93.65 million in royalties to the State every year.
“The importance of BLM-administered oil and gas leases in North Dakota is magnified by the unique split-estate nature of much of the surface and mineral ownership interests in North Dakota, which allows relatively small Federal mineral interests to control exploration and production from much larger pooled and co-located State and private surface mineral interests that are jointly operated under Communitization,” the lawsuit added.
“Federal Defendants’ arbitrary decision to cancel oil and gas leases violates several major Federal statutes, including those aimed at recognizing the critical role of states like North Dakota, managing natural resources, protecting the environment, and ensuring due process in Executive Branch administrative decisions,” the lawsuit charged, continuing, “The damages caused by Federal Defendants’ unlawful blocking of oil and gas development on State and private lands are in addition to the hundreds of millions of dollars in lost royalties from Federal Defendants unlawful moratorium on the leasing of federal mineral interests.”
“Through their violation of their mandatory duties under the Mineral Leasing Act, Federal Defendants have unlawfully, unilaterally and arbitrarily exercised veto power over the development of State and private mineral interests, exceeding Federal Defendants’ statutory jurisdiction under the Mineral Leasing Act,” the lawsuit asserted. “By blocking the development of the State and private mineral interests, the unilateral actions of the Federal Defendants have deprived North Dakota of its ability to regulate such development, effectively exercising an unlawful federal veto over North Dakota’s authority to regulate State and privately-owned natural resources in the State.”
The lawsuit challenged, “On information and belief, Federal Defendants intend to further violate their mandatory duties under the Mineral Leasing Act into the foreseeable future, and thus will continue to unlawfully, unilaterally and arbitrarily block the development of significant State and private mineral interests in North Dakota in excess of Federal Defendants’ statutory jurisdiction under the Mineral Leasing Act.”