CHAPTER 3 ACCESSING INDIAN LANDS FOR MINERAL DEVELOPMENT
| Jurisdiction | United States |
(Nov 2005)
ACCESSING INDIAN LANDS FOR MINERAL DEVELOPMENT
Crowley, Haughey, Hanson, Toole & Dietrich P.L.L.P.
Billings, Montana
Colby L. Branch is an associate in the Billings, Montana, office of the Crowley, Haughey, Hanson, Toole & Dietrich P.L.L.P. law firm, where he practices natural resource and Indian law.
Mr. Branch graduated with highest honors from the Gonzaga University School of Law in 1999. While at Gonzaga, he was a recipient of the Rocky Mountain Mineral Law Foundation's Joe Rudd Scholarship. Mr. Branch has an M.S. degree in Geology, and worked as a petroleum geologist for eight years prior to attending law school. Mr. Branch reports on developments in Montana oil and gas law for the Foundation's Mineral Law Newsletter, and updates several chapters in the Foundation's treatises regarding mining and federal oil and gas leasing.
He is a member of the Petroleum Association of Wyoming, and sits on the Board of Directors for the Montana Petroleum Association. Mr. Branch serves on the Resource Advisory Council for the Bureau of Land Management's Eastern Montana District.
He is admitted to the practice of law in Montana, North Dakota, and Wyoming.
I. INTRODUCTION
Indian reservations in the Western United States are commonly comprised of a haphazard checkerboard of fee, 1 tribal, 2 and allotted lands. 3 This fragmented ownership, together with the fact that Indian trust lands 4 are governed by federal rather than state law, 5 leads naturally to surface access and use problems not normally encountered by mineral developers accustomed to operating outside Indian reservations.
This paper provides a practical summary of surface access and use on trust lands for purposes of mineral development. The several methods by which surface rights can be obtained on trust lands for mineral development are presented, and the scope and limitations of each method are briefly discussed. An exhaustive review of regulatory procedure is not attempted. Issues specific to particular applications, such as the regulation of surface use in conjunction with coal mining, are not discussed.
This paper begins with a very brief history of federal Indian policy and the result of this changing policy on land ownership patterns and regulatory jurisdiction. Access to the worksite across reservation lands is discussed, a point sometimes neglected but which should never be forgotten. The scope of surface rights under a standard mineral lease is addressed. Alternate means of obtaining consensual surface access are presented, including rights-of-way, business leases, and Indian Mineral Development Act agreements. Access by the means of last resort, condemnation, is discussed, as is surface access over Indian split estates. The paper concludes with a brief review of the law regarding trespass on Indian trust lands -- the potential penalty for failure to comply with all the preceding sections.
A mineral developer contemplating operations on an Indian Reservation will be well-served to remember a few basic tenets of Indian law: Congress has plenary power over Indian affairs and lands, subject only to constitutional limitations. 6 No interest in trust lands, whether beneficially owned by a tribe or by an individual allottee, may be transferred or conveyed except as authorized by Congress. 7 Any purported conveyance in violation of such authorization is void and of no effect. 8 Therefore, a prudent mineral developer will ensure that any interest obtained in trust lands, whether by lease, right-of-way, or otherwise, is obtained in full compliance with applicable federal law and regulation, and that the resulting drilling or mining operations do not exceed the scope of the interest obtained.
II. FEDERAL INDIAN POLICY AND LAND OWNERSHIP
The fragmented land and mineral ownership within Indian reservations results from changing federal Indian policy through time. The discussion that follows is intended only to provide a common ground for presentation of the substance of this paper. For a more in-depth discussion of federal Indian policy and the effect of such changing policies on land ownership in Indian country, the reader is referred to the excellent works from which this discussion is largely drawn. 9
Fragmentation of most Indian reservations began with the General Allotment Act of 1887, 10 also known as the "Dawes Act." This legislation authorized the President to allot tribal lands in severalty to members of the tribe. 11 Title to the allotted lands was to be held by the United States in trust for the benefit of the individual Indian allottee for 25 years, which term could be extended at the discretion of the President. 12 At such time as all eligible members had received an allotment, the Secretary was authorized to negotiate with the tribe for the sale of any "surplus" lands to the United States. 13 Such agreements were not final until ratified by Congress. 14 All surplus lands suitable for agriculture were to be disposed of under the homestead laws. 15
The General Allotment Act was put into effect on a reservation-by-reservation basis through special Acts of Congress, which generally implemented (or, in some cases, super-ceded) the terms of that Act with regard to the allotment of tribal lands. Such implementing legislation also generally contained Congressional ratification of the Secretary's agreement with the tribe regarding the sale of surplus lands to the United States. Legislation implementing the General Allotment Act generally provided that surplus lands were to be disposed of under the homestead, mineral, and townsite laws in effect at the time.
The General Allotment Act effectively turned large blocks of tribal lands into checkerboards of allotted and fee lands. It also caused a "precipitous" decline in the total amount of Indian-owned land, from 138 million acres in 1887 to 48 million acres in 1934. 16 Much of this land was patented directly to white settlers as surplus lands, but many allotments were also sold to non-Indians by the allottees, following receipt of a fee patent to their land. 17
Passage of the Indian Reorganization Act of 1934 18 ("IRA") signaled a dramatic reversal in federal Indian policy. The IRA immediately halted the practice of allotment. 19 The trust period placed on remaining Indian lands was extended indefinitely. 20 The Secretary was authorized to restore to tribal ownership any remaining surplus lands in Indian reservations that had been opened to entry under the General Allotment Act, subject to all valid existing rights. 21
Lands restored to tribal ownership pursuant to the IRA were largely those that had gone unclaimed by allottees and settlers. The selection process resulted in the fragmentation of tribal lands. Though large blocks of tribal land do remain, a significant amount of tribal ownership has been reduced to separate and scattered tracts.
III. REGULATORY JURISDICTION OVER SURFACE USE
Because of the checkerboard land ownership in modern Indian reservations, it is important to remain aware of the regulatory reach of the various governmental entities. Regulatory jurisdiction in Indian country is an extremely complex and dynamic subject, and questions often arise as to the respective authority of federal, tribal, and state regulatory agencies. An in-depth discussion is beyond the scope of this paper. For a more complete discussion, the reader is referred to the sources from which the following summary is largely based. 22
A. Federal Regulatory Jurisdiction
As previously stated, Congress has plenary power over Indian affairs and lands, subject only to constitutional limitations. 23 Broad authority has been delegated to the Department of Interior, and exercised through rule-making by the Bureau of Indian Affairs ("BIA") and Bureau of Land Management ("BLM"). The scope of this delegated authority will become evident in the remainder of this paper. Virtually every aspect of mineral development on trust lands is governed by federal regulation.
One question that often arises is the relative authority of the federal, tribal and state governments in the development of split-estate lands, where the mineral and surface estates are separately owned. Split-estate matters are discussed in a subsequent section of this paper. Generally speaking, however, federal law will control the development of minerals owned by the United States (whether in its own right or in trust for an Indian beneficiary) pursuant to a valid mineral reservation, and will preempt inconsistent state law. 24 Development of fee minerals beneath acquired federal or trust surface presents a closer question. However, the courts have generally held that federal surface use regulations will preempt inconsistent state law. 25
B. State Regulatory Jurisdiction
State jurisdiction is preempted by operation of federal law if it interferes or is incompatible with federal and tribal interests reflected in federal law, unless the state interests at stake are sufficient to justify the assertion of State authority. 26 The exercise of state authority may also be barred to the extent that it imposes an undue burden on tribal government, or in the Supreme Court's words, "unlawfully infringes on the right of reservation Indians to make their own laws and be ruled by them." 27 Given the strong federal interest in the protection of trust land and the comprehensive federal regulatory scheme with regard to mineral development, state regulatory authority over mineral development on trust lands is very limited.
State conservation boards generally regulate oil and gas development on fee lands within Indian reservations. They have little, if any, authority over trust lands, and may not enforce state spacing or pooling orders as to included trust lands. 28 Since the federal and tribal governments are likewise without authority to space or pool fee...
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