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Industrial Commission upholds Killdeer Mountain drilling decision

BISMARCK -- In a unanimous decision on Wednesday, the North Dakota Industrial Commission voted to uphold a recent decision allowing oil drilling in an area in Dunn County near Killdeer Mountain.

The IC -- comprised of North Dakota Gov. Jack Dalrymple, Attorney General Wayne Stenehjem and Agriculture Commissioner Doug Goehring -- voted last month to approve a series of well pad sites to be developed by Hess Corp. Dunn County resident Loren Jepson and his legal counsel, Tom Gehrz of Mackoff Kellogg in Dickinson, filed an appeal of the January IC decision.

Jepson, who was not present at Wednesday's monthly IC meeting at the State Capitol, had requested the commission take a second look at its decision based on several factors, including the presentation of incorrect information by Director of Mineral Resources Lynn Helms' office.

"We were asked to reconsider order 20920 and the response is a recommendation to deny that request for reconsideration," Helms told the commission before its vote. "The grounds that the appeal was brought on don't meet the legal test for a reconsideration."

Jepson and other Killdeer Mountain drilling opponents had requested that Hess drill in a different area near the pad sites in question, although Helms said such a move would create new mineral rights issues for landowners.

The land in question could hold as much as 3.5 millions barrels of oil, according to DMR estimates. Wednesday's decision does not mean Jepson is out of options as far as appealing Hess' drilling, but any future appeals would need to be brought in District Court.

An opposition to the drilling of up to eight wells near the sacred Native American destination Medicine Hole developed last year. A number of individuals voiced concerns ranging from added local truck traffic to wildlife management in the area and oil exploration encroachment into an area where Native American artifacts are known to have been found. In its decision last month, the IC added stipulations to its approval of the development of the land.

Hess must make an attempt to limit the flaring of natural gas on well sites and must alert the State Historical Society prior to site construction so an independent archeologist can check for artifacts, according to the IC's original decision. Also, hydraulic fracturing can only occur in the area during the summer so as not to cause safety concerns with truck and school bus traffic on rural roads.

"I'm obviously disappointed with the decision," Jepson said. "The thing that is most disappointing is that I didn't even know there was a meeting (Wednesday). I think the story is that that the commission doesn't let people know what they're doing and what they're talking about at these meetings."

Gehrz sent a letter requesting that Jepson's Killdeer Mountain appeal be heard at a later meeting. In his appeal, Jepson had also stated concerns that Helms was in a position of bias in his recommendation to the IC, an accusation rebuffed by Goehring.

"I cannot say that I have found at one time where (Helms) has approached us with a bias," Goehring said. "Mr. Helms has given us options and provided pros and cons of situations. Still, we have to consider how we fulfill our obligations and duties."

Goehring and Stenehjem stated that the time to provide information and evidence against drilling on the sites in question was before the matter came to the IC.

"I'm happy with the commission's decision," Helms said. "I truly believe that the right decision was made in this case. The grounds weren't there to reconsider this case.

"Originally, this case was on the September (DMR hearing) docket and we continued it a month so that people could secure legal counsel and do research and come to the hearing prepared," he said. "We actually re-opened the record for some additional written documents based on some archeological concerns and Hess' plans around timing of the drilling. Normally, we wouldn't do that. We really took our time with this case."

Bryan Horwath
A Wisconsin native, Horwath has been covering news in the Oil Patch of North Dakota since 2012. Horwath currently serves as the senior agriculture and political reporter for The Dickinson Press and, despite the team's tendency to always let him down, remains a diehard Minnesota Vikings fan.
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