§ 38-08-19 — Common purchasers - Discrimination in purchasing prohibited

North Dakota § 38-08-19

• Jurisdiction: North Dakota
• Title 38: Mining and Gas and Oil Production
• Ch. 38-08: Control of Gas and Oil Resources

Text

1. Every person, association of persons, corporation, or limited liability company now
engaged or hereafter engaging in the business of purchasing crude petroleum in this
state shall be a common purchaser thereof.
2. Every common purchaser of crude petroleum shall, without discrimination in favor of
one producer or royalty owner as against another in the same marketing district as
determined by the commission, purchase all oil tendered to it at the wellhead or at its
receiving terminal, which has been lawfully produced, provided that no common
purchaser may be required to purchase crude petroleum of inferior quality or grade, or
which is unsuitable for its operations.
3. Whenever a common purchaser is unable to purchase all of the oil tendered to it
hereunder, it shall purchase ratably from each marketing district, field, pool, or well,
with respect to which such tenders are made. As between wells, purchases shall be
considered ratable only if such purchases are made in proportion to the allowables
which are or would be assigned to such wells under existing commission rules and
regulations, and, as between marketing districts or fields or pools, purchases may be
considered ratable if such purchases are made in proportion to the sum of the
allowables which are or would be assigned to all wells from which tenders are made in
each such marketing district or field or pool.
4. Every common purchaser of crude petroleum is hereby expressly prohibited from
discriminating in favor of its own production or that of an affiliate as against that of
others, and the oil produced by such common purchaser or by an affiliate of such
common purchaser must be treated as that of any other producer for the purposes of
ratable taking.
5. It is unlawful for any common purchaser to discriminate between oil transported from
the wellhead to its receiving terminal in favor of one carrier of crude oil as against
another, and nothing herein may be construed to prevent any person, association of
persons, corporation, or limited liability company from transporting crude oil from
wellhead to receiving terminal of said common purchaser from properties in which
such person, association of persons, corporation, or limited liability company may own
an interest, and such person, association of persons, corporation, or limited liability
company may not be deemed to be in the business of purchasing, or of purchasing
and selling crude petroleum within the meaning of this section. Nothing herein may be
construed to prohibit any common purchaser from requiring that proper and
reasonable facilities be erected and maintained at its receiving terminal by any person,
association of persons, corporation, or limited liability company transporting crude oil
to such terminal, requiring that a surety bond be posted indemnifying said common
purchaser from liability for the transporter's failure to properly account to the owners of

crude oil so transported, or posting a just and reasonable handling charge for
accepting delivery at its receiving terminal.
6. The provisions of this section cover the purchase, or purchase and sale of crude
petroleum, and that gathering, handling, marketing, and all other charges assessed by
a common purchaser against crude oil produced within this state must be just and
reasonable. The commission, after notice and hearing as provided in section 38-08-11,
may determine the justness and reasonableness of charges on its own motion or upon
motion of any interested person.