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U.S. court orders wind farm dismantled to protect Osage mineral rights

The Energy Mix|Christopher Bonasia|January 19, 2024
OklahomaLegal

After a court sided with the Osage Nation to have an 84-turbine, 150-megawatt wind farm in Oklahoma removed for encroaching on its mineral rights, Italy-based Enel Energy is appealing the ruling, with dismantling costs looming at US$300 million. 


After a court sided with the Osage Nation to have an 84-turbine, 150-megawatt wind farm in Oklahoma removed for encroaching on its mineral rights, Italy-based Enel Energy is appealing the ruling, with dismantling costs looming at US$300 million.

Representatives for the Nation say the lawsuit is about protecting their ability to develop precious minerals, hydrogen power, or carbon sequestration for future climate projects, reports Politico.

“Our effort, not only will it protect the production side, but we’re looking at actually protection of our reservation for future generations,” said Osage Minerals Council chair Everett Waller. “That is really a huge effort.”

The Osage Nation is a federally recognized tribal nation headquartered in …

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After a court sided with the Osage Nation to have an 84-turbine, 150-megawatt wind farm in Oklahoma removed for encroaching on its mineral rights, Italy-based Enel Energy is appealing the ruling, with dismantling costs looming at US$300 million.

Representatives for the Nation say the lawsuit is about protecting their ability to develop precious minerals, hydrogen power, or carbon sequestration for future climate projects, reports Politico.

“Our effort, not only will it protect the production side, but we’re looking at actually protection of our reservation for future generations,” said Osage Minerals Council chair Everett Waller. “That is really a huge effort.”

The Osage Nation is a federally recognized tribal nation headquartered in Osage County, which the U.S. Congress designated as the Osage Nation’s reservation in 1872. In 1906, Congress severed rights to the land’s surface from mineral rights below the surface with the Osage Act. The legislation allotted surface rights to members of the Osage Nation, while the mineral estate was reserved for the benefit of the Osage Nation, rather than for individuals, wrote Judge Jennifer Choe-Groves in the decision on United States v. Osage Wind, LLC.

Through the Osage Act, the Nation was authorized to issue “leases for all oil, gas, and other minerals” in the mineral estate. It was Enel’s encroachment on these subsurface mineral rights—and its failure to secure a permit even when notified—that prompted the lawsuit.

“We’re tired of this. We’ve been tired of this,” said Osage Nation Principal Chief Geoffrey Standing Bear. “My father’s generation was tired of it, my grandfather and great grandparents. You can’t just sit there and gripe about it—you’ve got to stand up, and that’s what our Minerals Council did.”

The December ruling followed years of litigation brought by the Osage Nation against Enel. Though the wind developer had initially properly leased 8,400 acres (around 34 square kilometres) of surface rights in 2010, the Osage Nation filed a lawsuit in 2011 to halt construction out of concern that the turbines would interfere with access to its subsurface mineral rights. That case was dismissed on its merits.

But after construction of the wind turbines began in 2013, Enel began extracting and crushing rock to use as construction backfill. Claiming that this action should be considered mining, which would require authorization from the Mineral Council, the Nation notified Enel that a permit was needed for such activities and requested that the mineral excavations cease until a permit was obtained. Enel did not obtain a permit and did not cease its activities—in fact, some sources indicate that it sped up its work.

The Nation then filed another lawsuit that made its way up through the court system to the present case. Initially, a district court held that Enel’s actions weren’t considered “mining.” But that ruling was later overturned by a U.S. appeals court, which pointed out that Enel “sorted the rocks, crushed the rocks into smaller pieces, and then exploited the crushed rocks as structural support for each wind turbine” (emphasis in original), acts that constituted mineral development. An attempt by Enel to have the case heard by the Supreme Court was declined.

In the end, Choe-Groves’ ruling in the district court for the Northern District of Oklahoma upheld that interpretation and ultimately found that the presence of Enel’s wind turbines constituted continuing trespass.

“On the record before the Court, it is clear the Defendants are actively avoiding the leasing requirement,” Choe-Groves wrote. “Permitting such behaviour would create the prospect for future interference with the Osage Mineral Council’s authority by Defendants or others wishing to develop the mineral lease.”

“The Court concludes that Defendants’ past and continued refusal to obtain a lease constitutes interference with the sovereignty of the Osage Nation and is sufficient to constitute irreparable injury.”

The ruling grants the United States—and the Osage Nation through its Minerals Council—permanent injunctive relief via “ejectment of the wind turbine farm for continuing trespass.”

The win for the Osage Nation was greater than anticipated, Politico says, and it was also unusual for ordering an operating energy project to be removed.

Enel’s cost to dismantle the wind farm could run to about $300 million, the company estimates. It intends to appeal, saying it disagrees that its use of rock for backfill should be considered mining.

Though Choe-Graves has ordered the wind turbines’ removal, a trial over damages is still to come and could start this fall. Standing Bear says questions remain over whether the amount of damages will be just the value of the rock, or whether it will also include “the value of intruding on our sovereign property that we’ve kept and fought for and kept all these years.”

There is a possibility of a yet-to-be-determined negotiated settlement, but Standing Bear says that either way, the wind turbines must be removed.

“My legislature, the Osage Congress, has not yet spoken on that, neither has the Minerals Council, but as Chief, I can tell you, my view is—they’ve got to come down,” he said. “I would like to see damages to us for what we consider not only the cost of the rock but the cost of the trespass.”

He added: “It’s been a cruel disregard for our rights, and it’s got to stop. And if they get off on minimal damages, others will come in and do the same thing.”

Offering further context, Politico explains that the Osage Nation recently gained wide recognition from the film Killers of the Flower Moon. “The film—based on a nonfiction book—tells the story of dozens of murders of tribal members in the early 20th century by white men who wanted to take the tribe’s oil rights.”


Source:https://www.theenergymix.com/…

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