Property Rights Law Firm, P.A.

Will eminent domain make a multi-state oil pipeline a reality?

Over the last several decades, significant parts of both Montana and North Dakota have undergone a drastic transformation thanks to the discovery of massive deposits of oil and natural gas in the Bakken Formation. Indeed, where there were once fields and dirt, there are now derricks and other major infrastructure.

While this massive increase in domestic oil production has undoubtedly had a major effect on the nation's finances, it has also served to raise a host of pressing legal issues. For instance, many questions are now being raised about the use of eminent domain to transfer this oil across state lines.

Where exactly is the transfer of oil and the use of eminent domain becoming an issue?

Dakota Access LLC, a subsidiary of Texas-based Energy Transfer Partners, is proposing the construction of a pipeline that would transfer as many as 570,000 barrels of crude oil per day from the oil fields of North Dakota to a refinery based in Illinois.

This pipeline would cut diagonally across 18 Iowa counties, and Dakota Access has already secured voluntary easements on over 68 percent of the necessary land. However, some Iowa farmers are refusing to budge and, as a result, the Iowa Utilities Board will need to decide whether eminent domain should be utilized.

Who exactly would be using the power of eminent domain?

The IUB is holding a public hearing that will start next week and last through early December to decide two important issues: 1) if the oil pipeline will "promote the public convenience and necessity," and 2) whether Dakota Access should be permitted to employ eminent domain to take the necessary land.

What happens if the IUB decides to grant Dakota Access eminent domain powers?

If Dakota Access does secure eminent domain powers, those unhappy with the decision would have the option of asking a state court to review the decision.

What is the prevailing opinion in Iowa concerning the use of eminent domain for the pipeline?

While 57 percent of Iowans indicated in a recent poll that they supported construction of the pipeline, they were staunchly opposed to the use of eminent domain to see it happen. Indeed, 74 percent opposed the use of eminent domain while 7 percent were uncertain.

Stay tuned for updates on this fascinating story …

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