2018 OFFICIAL PUBLICATION OF THE MONTANA PETROLEUM ASSOCIATION
The case against the Beartooth Front District
By Jessica Sena
State and local co ers have felt the loss of tax revenue from natural resource development. Oil and natural gas production
has not yet recovered in Montana, though prices have returned to highs not seen since 2014. Insu cient infrastructure, service
shortages in many areas, and public pushback all pose challenges to viable exploration, hampering the recovery of drilling
activity. While limitations to development will always exist in the risky and costly business of oil a and gas exploration, the in-
uence of public opinion on public policy is increasing.
TO ZONE OR NOT TO ZONE
Despite record low drilling activity, opposition to development has
not diminished. In Stillwater County, a group of landowners have
been petitioning the County to regulate oil, natural gas, and coal bed
methane extraction on 83,000 acres of what’s known as the “Stillwater
County Beartooth Front District.” is citizen-initiated e ort is three
years old. Petitioners claim existing regulations are inadequate for
protecting the environment and their rural way of life.
In January, the Stillwater County Commission denied the petition
a er County Attorney Nancy Rhode advised Clerk & Recorder Heidi
Stadel to invalidate it on the basis that signatories did not include
But the battle is far from over.
On February 26th, advocates for the petition, calling themselves the
Beartooth Front Coalition, led a lawsuit against Stillwater County
in District Court for petition guidelines (proposed in January 2018)
that they say were not made clear to them throughout the signature
collection process. Guidelines require mineral owners to be included
in zoning petitions.
Hearings for the proposed guidelines and petition, and the recently
led lawsuit, remain ongoing.
DEFENDING THE COMMISSIONERS
Contemporary regulations for oil and natural gas are complex and
comprehensive. However, the regulations have aided Montana’s environmental
record of responsible development (Exhibit A). On the
other hand, relentless pursuit of more regulation, in the absence of
material harm, is super uous for ensuring the protection of public
health and the environment.
In the more than 60 years of hydraulic fracturing, there has not been
a single case of groundwater contamination as the result of stimulation
A 2014 U.S. Geological Survey study of 30 randomly distributed domestic
wells tested in oil producing areas of Montana and North Dakota
showed shallow groundwater quality had not been a ected by energy
Flaring of fugitive emissions (methane) from oil wells is captured at a
rate above 90 percent.
At the height of production (2011-2013), Richland County (the highest
in oil production) maintained an A+ rating by the American Heart
and Lung Association for air quality.
Consider the negative impact that time, resource, and nancial restraints
pose to Stillwater County Commissioners. Mainly, the inability
to e ectively oversee permitting and environmental compliance.
Such limitations contradict the intent of the petition.
Another point of contention is whether the Stillwater County Commission
has the legal right to establish independent rules for oil and
gas permitting. e proposed district may undermine legally-determined
spacing units for oil and natural gas wells, infringing on the
correlative rights of mineral owners. Preventing reasonable access for
development may result in wasted oil and natural gas resources (See
Exhibit B). Sounds like a lawyer’s dream.
MCA 82-11-201 e Establishment of Well Spacing Units
is statute gives the Board of Oil and Gas Conservation (BOGC)
the authority to space wells in a manner that protects the correlative
rights of mineral owners, prevents the drilling of unnecessary wells,
and prevents the waste of oil and natural gas resources. e BOGC
has the legal authority to increase or decrease the size of a temporary
or permanent spacing unit.
Both surface and mineral owners have property rights, and legally,
the mineral estate is the dominant estate. Stillwater County Commissions
were wise to consider the rights of mineral owners.
Montana law addresses development and compensation on split
estates. For reasonable access to use of the surface, companies pay
compensation to the surface owner as negotiated prior to land use.
But what happens when mineral owners can’t lease their property for
development? ere is no such law that says these property owners
must be compensated. is sets the stage for “takings without compensation”
lawsuits, which could overwhelm county government and