They Can’t Get Answers From th... Note
ProPublica

They Can’t Get Answers From the Oil Industry. North Dakota’s Oversight Program Hasn’t Helped.

Mineral owners in North Dakota are struggling with oil and gas companies over significant deductions from their royalty payments. These deductions, known as postproduction costs, cover expenses for processing and transporting minerals. For years, owners have faced a lack of transparency and cooperation when seeking explanations from companies. In 2023, mineral owners testified at the North Dakota Capitol, advocating for greater company accountability and penalties for non-compliance. Lawmakers responded by creating a state "postproduction royalty oversight program" aimed at resolving these conflicts. However, an investigation found the program has been largely ineffective, resolving few cases and none involving postproduction deductions. The program has shifted focus to other issues like withheld payments and late interest. Many mineral owners distrust the program and find legal recourse financially prohibitive. Companies argue that royalty statements are complex due to regulatory requirements. The state does not regulate deductions for private mineral owners, unlike those on state-owned land. Former Senator Merrill Piepkorn described the companies' tactics as "obfuscation through transparency." Mineral owners continue to seek clearer explanations for the substantial withholdings from their royalty income.