§ 57-51.2-02 — Agreement requirements

North Dakota § 57-51.2-02

• Jurisdiction: North Dakota
• Title 57: Taxation
• Ch. 57-51.2: Tribal Oil and Gas Agreements

Text

An agreement under this chapter is subject to the following:
1. The only taxes subject to agreement are the state's oil and gas gross production and
oil extraction taxes attributable to production from wells located within the exterior
boundaries of the reservation and wells located on trust properties outside reservation
boundaries. For purposes of this chapter, "trust properties outside reservation
boundaries" means land in this state located outside the exterior boundaries of a
reservation which are held in trust by the United States for any Indian tribe or owned
by an Indian tribe or tribal member subject to a restriction against alienation imposed
by the United States.
2. The state's oil and gas gross production tax under chapter 57-51 must apply to all
wells located within the reservation and on trust properties outside reservation
boundaries.
3. The state's oil extraction tax under chapter 57-51.1 as applied to oil and gas
production attributable to trust lands on the reservation and on trust properties outside
reservation boundaries may not exceed six and one-half percent but may be reduced
through negotiation between the governor and the tribal governing body.
4. Any exemptions for oil and gas production from trust lands under chapters 57-51 and
57-51.1 do not apply to production within the boundaries of the reservation and on
trust properties outside reservation boundaries except as otherwise provided in the
agreement.
5. The allocation of revenue from oil and gas gross production and oil extraction taxes on
the reservation must be as follows:
a. Production attributable to trust lands. The tribe must receive eighty percent of the
total revenues, and be subject to all applicable exemptions from all oil and gas
gross production and oil extraction taxes attributable to production from trust
lands on the reservation and on trust properties outside reservation boundaries.
The state must receive the remainder.
b. All other production. The tribe must receive twenty percent of the total oil and gas
gross production and oil extraction taxes collected, and be subject to all
applicable exemptions, from all production attributable to nontrust lands on the
reservation in lieu of the application of tribal fees and taxes related to production
on such lands. The state must receive the remainder.
c. The state's share of the oil and gas gross production tax revenue as divided in
subdivisions a and b is subject to distribution among political subdivisions as
provided in chapter 57-51.
6. An oil or gas well that is drilled and completed during the time of an agreement under
this chapter must be subject to the terms of the agreement for the life of the well.
7. The tribal governing body must agree not to impose a tribal tax or any fee on future
exploration and production of oil and gas on the reservation and on trust properties
outside reservation boundaries during the term of the agreement.
8. To address situations in which the tax commissioner refunds taxes to a taxpayer, the
agreement must allow the tax commissioner to offset future distributions to the tribe.

9. The tax commissioner must retain authority to administer and enforce chapters 57-51
and 57-51.1 as applied to wells subject to any agreement authorized by this chapter.
10. An oil or gas well that is drilled and completed during the time an agreement under this
chapter is in effect is subject to state regulatory provisions for the life of the well in
addition to any other applicable regulatory provisions.
11. The federal district court for the northwestern division of North Dakota is the venue for
any dispute arising from a revenue-sharing agreement between the state and the
Three Affiliated Tribes or between the state and the Turtle Mountain Band of Chippewa
Indians. The federal district court for the southwestern division of North Dakota is the
venue for any dispute arising from a revenue-sharing agreement between the state
and the Standing Rock Sioux Tribe.
12. The agreement must require that the tribal governing body report annually to the
budget section of the legislative management and that the report:
a. Identifies projects totaling investment of at least ten percent of tribal oil and gas
gross production and oil extraction tax receipts of the tribe for that year in
essential infrastructure.
b. At a minimum, informs the budget section of tribal investments in essential
infrastructure and fees, expenses, and charges the tribe imposes on the oil
industry.