Oilfield company fights illegal dumping fine at ND Supreme Court
BISMARCK — A trucking company that illegally dumped oilfield waste on a northwest North Dakota road in 2014 continues to contest a $950,000 state fine, taking its case to the state Supreme Court on Thursday, June 22.
Black Hills Trucking does not dispute that one of its truck drivers intentionally released produced water, a waste byproduct of oil production, onto a Williams County gravel road, said attorney John Morrison.
But the company contends that, because it already paid a $250,000 fine to the North Dakota Department of Health, it should not also have to pay a fine to the North Dakota Industrial Commission for the same violations.
The company, part of Wyoming-based True Companies, also argues the Industrial Commission overstepped its jurisdiction and should reimburse Black Hills Trucking for attorneys' fees.
The dispute dates back to February and March of 2014, when surveillance equipment recorded the company's trucks dumping produced water on a road. One incident was observed by a Department of Mineral Resources inspector, which led to a criminal conviction against the driver and a $3,000 fine.
The health department fined the company $200,000 for several violations, including the illegal dumping and violations related to the company hauling waste without a permit for eight years.
An additional $259,000 fine was suspended by the health department as long as the company met certain conditions, including not hauling oilfield waste for five years.
The Industrial Commission, which consists of the governor, attorney general and agriculture commissioner, also fined the company $950,000. Attorney Hope Hogan argued the agency has broad jurisdiction over oilfield waste, including trucking of produced water from the well to the disposal site.
Hogan said the road was never cleaned up, even after the Industrial Commission issued a complaint.
Morrison argued there was no evidence of environmental damage and regulators never asked Black Hills Trucking to do any cleanup at the site.
Last spring, an administrative law judge reviewed the matter and sided with the company, saying the Industrial Commission does not have jurisdiction over trucking of produced water. The Industrial Commission rejected that decision and persisted with its fine, a decision upheld by the district court.
Now the company is seeking the Supreme Court to reverse that decision and dismiss the fine. The Supreme Court took the matter under advisement.