# Title 38 — Mining and Gas and Oil Production

## Chapter 38-11.2 — Subsurface Exploration Damages

### § 38-11.2-01. Definitions.

In this chapter, unless the context or subject matter otherwise requires:
1. "Agricultural production" means the production of any grass or crop attached to the
surface of the land, whether or not the grass or crop is to be sold commercially, and
the production of any farm animals, whether or not the animals are to be sold
commercially.
2. "Drilling operations" means the drilling of a subsurface mineral extraction well and the
injection, production, and completion operations ensuing from the drilling which require
entry upon the surface estate, and includes subsurface mineral exploration activities.
3. "Mineral developer" means the person who acquires the mineral estate or lease for the
purpose of extracting or using the subsurface minerals for nonagricultural purposes.
4. "Mineral estate" means an estate in or ownership of all or part of the subsurface
minerals underlying a specified tract of land.
5. "Subsurface mineral" means any naturally occurring element or compound recovered
under the provisions of chapter 38-12, but for the purpose of this chapter excludes
coal, commercial leonardite, oil and gas, sand and gravel, and rocks crushed for sand
and gravel.
6. "Subsurface mineral exploration activities" means any method of obtaining information
relative to locating and defining subsurface minerals that results in surface
disturbance.
7. "Surface estate" means an estate in or ownership of the surface of a particular tract of
land.
8. "Surface owner" means any person who holds record title to the surface of the land as
an owner.
### § 38-11.2-02. Inspection of well site.

Upon request of another state agency, the surface owner, or an adjacent landowner, the
department of environmental quality shall conduct a site visit and evaluate site-specific
environmental data as necessary to ensure compliance with applicable environmental protection
laws and regulations relating to air, water, and land management under the jurisdiction of the
department.
### § 38-11.2-03. Notice of drilling operations.

1. The mineral developer shall give the surface owner written notice of the drilling
operations contemplated at least twenty days prior to the commencement of the
operations, unless waived by agreement of both parties.
2. This notice must be given to the record surface owner at that person's address as
shown by the records of the county recorder at the time the notice is given.
3. This notice must sufficiently disclose the plan of work and operations to enable the
surface owner to evaluate the effect of drilling operations on the surface owner's use of
the property. Included with this notice must be a copy of this chapter.
4. If a mineral developer fails to give notice as provided under this section, the surface
owner may seek any appropriate relief in the court of proper jurisdiction and may
receive punitive as well as actual damages.
### § 38-11.2-04. Damage and disruption payments - Statute of limitations.

1. The mineral developer shall pay the surface owner a sum of money equal to the
amount of damages sustained by the surface owner and the surface owner's tenant, if
any, for loss of agricultural production and income, lost land value, lost use of and
access to the surface owner's land, and lost value of improvements caused by drilling
operations. The amount of damages may be determined by any formula agreeable

between the surface owner and the mineral developer. When determining damages,
consideration must be given to the period of time during which the loss occurs.
2. The surface owner may elect to be paid damages in annual installments over a period
of time.
3. The surface owner must be compensated for harm caused by subsurface mineral
exploration only by a single sum payment.
4. The payments contemplated by this section only cover land directly affected by drilling
operations.
5. Payments under this section are intended to compensate the surface owner for
damage and disruption. Any reservation or assignment of such compensation apart
from the surface estate except to a tenant of the surface estate is prohibited. In the
absence of an agreement between the surface owner and a tenant as to the division of
compensation payable under this section, the tenant is entitled to recover from the
surface owner that portion of the compensation attributable to the tenant's share of the
damages sustained.
6. To receive compensation under this section, any person shall notify the mineral
developer of the damages sustained by the person within two years after the injury
occurs or would become apparent to a reasonable person.
### § 38-11.2-05. Agreement - Offer of settlement.

Unless both parties provide otherwise by written agreement, the mineral developer shall
make a written offer of settlement to the person seeking compensation for damages when the
notice required by section 38-11.2-03 is presented. The person seeking compensation may
accept or reject any offer so made.
### § 38-11.2-06. Rejection - Legal action - Fees and costs.

If the person seeking compensation rejects the offer of the mineral developer, that person
may bring an action for compensation in the court of proper jurisdiction. The court, in its
discretion, may award the person seeking compensation reasonable attorney's fees, any costs
assessed by the court, and interest on the amount of the final compensation awarded by the
court from the day drilling operations are commenced. The rate of interest awarded must be the
prime rate charged by the Bank of North Dakota on the date of the judgment.
### § 38-11.2-07. Protection of surface and ground water - Other responsibilities of mineral

developer.
1. The mineral developer shall conduct or have conducted an inventory of water wells
located within one-half mile [804.67 meters] of where subsurface mineral exploration
activities are conducted, if such exploration activities appear reasonably likely to
encounter ground water, or within one mile [1.61 kilometers] of a subsurface mineral
production site.
2. The mineral developer shall conduct or have conducted a certified water quality and
quantity test within one year preceding the commencement of subsurface mineral
production operations on each water well or water supply located on the involved real
property and as identified by the surface owner of that real property. Results of water
quality tests conducted under this subsection must be reported in a prescribed format
to the department of environmental quality, which shall maintain a database of the
results. The water quality test must be collected as prescribed by the department of
environmental quality and analyzed by a state-certified laboratory.
3. If the domestic, livestock, or irrigation water supply of any person who owns an interest
in real property within one-half mile [804.67 meters] of where subsurface mineral
exploration activities are or have been conducted or within one mile [1.61 kilometers]
of a subsurface mineral production site has been disrupted, or diminished in quality or
quantity by the drilling operations, the person who owns an interest in real property is
entitled to recover the cost of making such repairs, alterations, or construction that will

ensure the delivery to the surface owner of that quality and quantity of water available
to the surface owner prior to the commencement of drilling operations.
4. Any person who owns an interest in real property who obtains all or a part of that
person's water supply for domestic, agricultural, industrial, or other beneficial use has
a claim for relief against a mineral developer to recover damages for disruption or
diminution in quality or quantity of that person's water supply proximately caused from
drilling operations conducted by the mineral developer.
5. Prima facie evidence of injury under this section may be established by a showing that
the mineral developer's drilling operations penetrated or disrupted an aquifer in such a
manner as to cause a diminution in water quality or quantity within the distance limits
imposed by this section, or by showing the mineral developer did not conduct or have
conducted the testing required under subsection 2.
6. If a person refuses to consent to the testing of a water well or water supply on land
owned by the person, as required under subsection 2, the person forfeits any claim for
relief under subsection 3 or 4.
7. An action brought under this section when not otherwise specifically provided by law
must be brought within six years of the time the action has accrued. For purposes of
this section, the claim for relief is deemed to have accrued at the time it is discovered
or might have been discovered in the exercise of reasonable diligence.
8. A tract of land is not bound to receive water contaminated by drilling operations on
another tract of land and the owner of a tract has a claim for relief against a mineral
developer to recover the damages proximately resulting from natural drainage of
waters contaminated by drilling operations.
9. The mineral developer is also responsible for all damages to person or property
resulting from the lack of ordinary care by the mineral developer or resulting from a
nuisance caused by drilling operations.
10. This section does not create a cause of action if an appropriator of water can
reasonably acquire the water under the changed conditions and if the changed
conditions are a result of the legal appropriation of water by the mineral developer.
### § 38-11.2-08. Application of chapter.

The remedies provided by this chapter do not preclude any person from seeking other
remedies allowed by law. This chapter does not apply to the operation, maintenance, or use of a
motor vehicle upon the highways of this state as these terms are defined in section 39-01-01.
