Complaint challenges new law on unpaid oil and gas royalties

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FILE – In this April 24, 2015, file photo, pumpjacks work in a field near Lovington, N.M. Oil industry and environmental groups say they expect the Environmental Protection Agency to release a proposed rule over the next few days that will roll back requirements on detecting and plugging methane leaks at oil and gas facilities (AP Photo/Charlie Riedel, File)

FARGO, N.D. (AP) — A complaint filed on behalf of a North Dakota agency challenges a new state law promoted by the energy industry on limiting the collection of oil and gas royalties.

The measure that went into effect this week reduces the amount of interest the state can charge companies for unpaid oil and gas royalties, from 30% to 15%.

In addition, the law that sailed through the Republican-dominated Legislature does not allow the state to collect unpaid royalties before August 2013.

The brief filed Monday on behalf of the state land board argues the legislation violates the U.S. Constitution because it harms the obligation of previously agreed-upon contracts.

State Land Commissioner Jodi Smith has said “hundreds of millions” of dollars are owed to the state.

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