82-10-303. Use of eminent domain to acquire underground reservoirs. (1) A natural gas public utility may acquire, through the exercise of the right of eminent domain as provided in Title 70, chapter 30, and this part, an underground reservoir for its use for the underground storage of natural gas. The right of eminent domain may be exercised only if the board finds that the reservoir is suitable and its taking is in the public interest for the underground storage of natural gas. In connection with the underground reservoir, the utility may acquire other interests in property that may be required to adequately maintain and operate the underground reservoir facilities. The acquisition by the exercise of the right of eminent domain of underground reservoirs granted by this section is limited as follows:

(a) Sand, a formation, or a stratum that is producing, that has produced, or that is capable of producing oil is not subject to taking under this section.

(b) A gas-bearing sand, formation, or stratum is not subject to taking under this section unless the recoverable volumes of native gas in the interest sought to be taken have all been produced or unless the sand, formation, or stratum has a greater value or utility as an underground reservoir for the purpose of ensuring an adequate supply of natural gas for domestic, commercial, or industrial consumers of natural gas or for the conservation of natural gas than for the production of the remaining relatively small volumes of native gas as compared with the original volumes of natural gas in the sand, formation, or stratum. Gas, sand, formation, or stratum may not be acquired under this part when the gas in the underground reservoir is being used for the secondary recovery of oil unless gas in necessary and required amounts is furnished to the operator of the secondary recovery operations for as long as oil is produced in paying quantities in the secondary operations for the recovery of oil at the same cost as the cost to the operator at the time of acquisition of the gas being used in the secondary operations. However, the amount of gas furnished may not exceed the quantity of the appropriated gas that remained recoverable from the sand, formation, or stratum at the time of its taking if the operator was at that time entitled to all of the gas or if entitled to less than all of the gas, then an amount not to exceed the quantity of gas to which the operator was entitled.

(c) Only the area of the underground sand, formation, or stratum that may reasonably be expected to be penetrated by gas displaced or injected into the underground reservoir may be taken.

(d) Rights or interests in existing underground reservoirs being used for the injection, storage, or withdrawal of natural gas owned or operated by a natural gas public utility other than the natural gas public utility seeking to acquire the reservoir are not subject to appropriation.

(2) The exercise of the right of eminent domain granted by this section is without prejudice to the rights of the owner of the land or of other rights or interests in the land to drill or bore into or through the underground reservoir in a manner that complies with orders and rules of the board issued for the purpose of protecting the underground reservoir against pollution and against the escape of natural gas and is without prejudice to the rights of the owner of the land or other rights or interests in the land as to all other uses of the land. The additional cost of complying with those rules or orders in order to protect the reservoir must be paid by the natural gas public utility.

History: En. Sec. 3, Ch. 259, L. 1955; amd. Sec. 85, Ch. 253, L. 1974; R.C.M. 1947, 60-803; amd. Sec. 100, Ch. 125, L. 2001.