Minerals Council

Oklahoma AG to BIA: State should take over oil and gas monitoring in the Osage

The Attorney General of Oklahoma, Scott Pruitt, is not satisfied with the Bureau of Indian Affairs.

In a letter sent to the BIA on Oct. 28, Pruitt said he wants the state to take over the monitoring of the oil and gas regulations in the Osage, including water use, with oversight from the Osage Minerals Council and the BIA.

“The State of Oklahoma and not the federal government, is best equipped to design, administer and enforce laws and regulations related to oil and gas development,” according to the letter. “State regulatory programs have been carefully designed to address state-specific issues and needs and are applied consistently, regularly reviewed, and continuously subjected to thoughtful administrative oversight.

“Currently, state regulators employ highly trained staff that efficiently oversees operations on state, federal and fee lands within our borders and issues permits in a timely manner. This stands in stark contrast to a federal program that is notorious for frequent and prolonged delays and persistent staffing challenges. These problems will likely intensify once budget cuts are combined with onerous and unnecessary new federal rules and requirements.”

The unnecessary new federal rules and requirements he is referring to is the proposed regulations put forth by the Negotiated Rulemaking Committee who met during the beginning of the year and wrapped in April. Many local oil and gas producers have not been happy with the new rules and the rules have sometimes split the OMC and caused disruption at council meetings, with both sides making accusations.

Osage County landowners, who own roughly 96 percent of the land in the county, have not been happy with various oil producers who don’t follow the existing rules and regulations and have at times endangered their families and wildlife.

Pruitt gave five recommendations to the BIA:

·      Start over with the rulemaking process
·      Develop process for accountability
·      Ensure that well records and subsurface data are accessible and accurate
·      Both the BIA and the Osage Mineral Council should develop a cooperative agreement with the State of Oklahoma
·      Enforce the rules

Water Rights

ON Attorney General Jeff Jones responded Nov. 18 in support of the new rules proposed by the Negotiated Rulemaking Committee. He said the proposed rule concerning water usage recognizes the long-standing relationship between the Nation and the federal government in regards to the Osage Mineral Estate.

“Since the creation of the Osage Mineral Estate in 1906, the Nation and the federal government have created a robust and exclusive regulatory scheme,” according to the Nation’s letter. “The Nation supports the continuation of the long-established regulatory authority of the BIA and the Osage Nation contained in the Proposed Rule’s current form.”

Jones said the Nation’s ownership and regulatory control of reserved waters within the county is a historical fact. When the Nation was forced to give up its lands in Kansas, the Nation purchased the reservation land from the Cherokee Nation in 1872 with the money made from the land sale in Kansas. The Nation still has the deed and the area became the Osage Indian Reservation. Even though the 10th Circuit Court of Appeals ruled the reservation was disestablished by the 1906 Act in Osage Nation vs. Irby in 2010, the minerals estate and ownership was kept intact.

“Undoubtedly, the Nation has held Indian reserved water rights since the United States created the Reservation in 1872. These water rights have never been extinguished nor diminished,” Jones said in the letter.

Topics addressed by the Nation in the letter included:

·      Historical Background: The continuous and exclusive ownership and regulation of the Osage Mineral Estate
·      The long-standing and exclusive regulatory authority of the Nation and BIA over waters related to development of the Osage Mineral Estate
·      The doctrine of federal reserved water rights
·      The primacy of federal and tribal regulatory authority

“Put simply, the Nation continues to desire to regulate its reserved water rights, in conjunction with the United States, as those water rights are applied to the successful development of the trust Osage Mineral Estate,” Jones said in the letter. “Consequently, the Nation urges the Bureau to adopt proposed 25 CFR 226.48 as published for the Leasing Osage Reservation Lands for Oil and Gas Mining.”