WorldWide Drilling Resource

68 MARCH 2015 WorldWide Drilling Resource ® Energy Development on Tribal Lands Part 1 Republished with permission of the Bakken Oil Business Journal, www.bakkenoilbiz.com/digital- journal. Written by Marianne Kaelberer (Copy Editor) and Chris Bischof (Executive Editor) There is a vast supply of energy resources beneath Indian lands. In fact, reservations contain nearly 30% of the nation’s coal west of the Mississippi, 50% of the nation’s uranium, and 20% of the oil and gas reserves. Indian ener- gy resources are estimated to be worth upwards of $1.5 trillion. However, though energy production in the United States is reaching record levels, the majority of energy resources on Indian lands remain untapped. Why aren’t tribes capitalizing on their vast energy resources? First, the bureaucracy involved in developing Indian lands is staggering. In the 19th century, the federal govern- ment set up trusteeships to manage Indian lands; a relationship described by Chief Justice John Marshall like “a ward to his guardian.” There are more than 500 federally recognized tribal lands, and they are to be managed by the federal govern- ment for the benefit of Native Americans according to the following rules. 1) The Secretary of the Interior must review and authorize all leases and agree- ments. 2) Federal agencies, and there are many, collect royalty payments on behalf of tribes and individual Indians and then redistribute them as royalty disbursements to Indian mineral owners. However, royalty payments, set by the Bureau of Indian Affairs, are undervalued and poorly negotiated and collected. If that’s the case, then companies should be pounding at the door to lease Indian lands. Not so! Companies must go through at least four federal agen- cies and up to 50 steps to acquire a permit for energy development on Indian land. This complicated bureaucracy not only raises the cost of entering into resource development agreements with tribes or individual Indians, but also causes many companies to avoid Indian lands altogether. Land tenure on Indian reservations also complicates energy development. There are three primary forms of land tenure. They form a checkerboard throughout the reservations, making it nearly impossible for companies to lease large parcels of land. 1) Tribal trust land is reservation land to which the U.S. government holds the legal title, but the beneficial interest lies with the tribe. This land is managed collectively by the tribe and cannot be sold or used as collateral. 2) In individual trust land, the gov- ernment once again holds the title, but beneficial interest remains with an indi- vidual Indian. These allotments were given to individual Indians under the General Allotment Act of 1887. Like the tribal trust land, individual trust lands cannot be sold or used as collateral. In Memoriam Douglas Wayne “Doug” Hooks (1954~2015) The South Carolina Rural Water Association sadly reported the pass- ing of Douglas Wayne “Doug” Hooks on January 4, 2015. Doug was the general manager of MarCo Rural Water Company for the past ten years. Prior to that, he worked with the City of Dillon and City of Mullins water departments. He was a member of the Marion Camp of the Gideons International, and Union Baptist Church. Doug is survived by his wife Ottie Lou; mother Kathleen; brothers Bud and Randy; and several nieces and nephews. The management and staff of WWDR express their condolences to Doug’s family and friends. Ronnie’s Real World When one leaves town, onenever knows what just might show up on her desk! Hummel Hummel is a traditional Hamburg greet- ing. The reply is Mors, Mors! The greeting goes back to the 19th Century and a cantankerous water carrier called Johann Wilhelm Bentz, known as Hans Hummel (born 21 January 1787, died 15 March 1854). As Hummel would carry water through the streets, the children would run behind him shouting “Hummel, Hummel!” to annoy him. Hummel would shout back “Mors, Mors!”, an abbreviation of either “klei di an’n mors!” (go scratch your a**e! or “Klei mi an’n Mors” (Kiss my a**e!) There appears to be some dispute over the exact phrase. The greeting was used by soldiers from Hamburg to greet each other, dur- ing the First World War. Nowadays, it is not used so much as a greeting, but has become a “battle cry” on the football terraces in Hamburg, Germany. A little out of character for this pub- lisher, but I thought you might enjoy it. Thank you Marcel - I love it! And that truly is... Ronnie’s Real World! see you on the trail... 3) Fee simple land is land on the reservation that was allotted and re- leased from trust prior to 1934 when the allotment period ended. This land is like any private land. Owners have legal title. These lands are often owned by non-Indians. And if that’s not enough, there’s another interesting issue on Indian reservations... Don’t miss Part 2 next month!