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Is Summit Negotiating in Good Faith?

Editorial | December 14th, 2022

By Laura Simmons

laurasimmons2025@u.northwestern.edu

Our opinion: Jesse Harris of Summit LLC: objections

Last month I wrote an article titled “Proposed Carbon Pipeline.” Summit Carbon Solutions Director of Public Affairs Jesse Harris had some follow-up comments for my article. Harris wrote in a text message that my article contained inaccurate information.

Harris requested that the High Plains Reader update the article to fix the inaccuracies. This article aims to share and address Harris’s comments and remedy any inaccuracies the previous article contained.

“Your statement that ‘There are no federal regulations governing carbon dioxide pipelines’ is 100% inaccurate,” Harris wrote. “The Pipeline and Hazardous Materials Safety Administration (part of the US DOT – a federal agency) has long maintained rigorous and comprehensive regulations of CO2 pipelines. There are 5,000 miles of CO2 pipelines in active service today, along with 3.3 million miles of pipelines in total and they are all regulated by this federal agency.”

Harris is correct. There are federal regulations governing carbon dioxide pipelines. I misunderstood Sam Wagner, Dakota Resource Council’s Field Organizer, who was trying to say there are no federal regulations specifically targeting carbon dioxide pipelines. The regulation of carbon dioxide pipelines falls under a wide umbrella of many types of hazardous liquid pipelines, including crude oil, refined biofuels, petroleum products and highly volatile liquids.

“The claim on liability and indemnification is flat-out untrue,” Harris wrote. “As I told you specifically in our interview, we (the company) indemnify and hold landowners harmless for any loss, damage, claim or action resulting from the project, with the sole exception of cases where there is gross negligence or willful misconduct.”

For convenient reference, here’s what my previous article stated in regard to indemnification: “Todd McMichael is one North Dakota landowner refusing to sign an easement agreement with Summit. McMichael said he didn’t sign because the indemnification and compensation portions were terrible. For example, if the carbon pipeline was to rupture and it killed McMichael’s own cattle, then Summit would cover the expenses; but, if the pipeline ruptured and killed his neighbor’s cattle, then Summit wouldn’t cover the damages, according to McMichael who said he should not have to be responsible for the damages caused by the rupture.”

Again, Harris is correct. I misunderstood a landowner who was explaining Summit’s previous indemnification policy. McMichael wrote in an email that he received an updated easement June 7, 2022 with the updated indemnification language.

“Summit cleaned up their indemnification and it looks good,” McMichael wrote. “But insurance companies are telling land owners we are not covered for a pipeline spill. This is a sticking point with landowners and Summit. Summit claims they have taken care of the insurance portion and landowners get a different message from the insurance companies.”

McMichael said after speaking to his attorney that if he isn’t named as an additional insured then if the pipeline were to rupture and cause harm to someone else’s property, he would then need to hire an attorney and go to court. If he was insured, then he would not have to go through this process.

McMichael then attached a letter from State Farm, which states, “Having a pipeline running through your property, carrying CO2, a pollutant, subjects you to substantial uninsurable exposure.”

The letter was in reference to the Navigator carbon dioxide pipeline, not Summit’s pipeline. However, McMichael wrote both Summit and Navigator are aiming to do the same thing and landowners are getting the same response from insurance companies when they inquire about Summit’s pipeline.

“One individual said that our contract would allow us to install ‘whatever they wanted on the surface of his land,’” Harris wrote. “Untrue again. Look at our permits. We are specifically requesting approval for the placement of a pipeline to transport CO2 and then sequester it underground. Nothing else. If we wanted to place anything else there, we would have to include that request in our permit.”

Kurt Swenson is the landowner to which Harris is referring. Swenson wrote in an email that perhaps Summit is confused. Swenson is not on the pipeline route but is rather on the pore space where Summit wishes to store carbon dioxide.

Summit’s proposed lease to Swenson states, “Lessor grants Lessee the right of reasonable use of the surface of the Leased Premises, including without limitation, the rights of ingress and egress over the Leased Premises together with the right of way over, under and across the Leased Premises and the right from time to time to construct, replace, inspect, repair, monitor, maintain, relocate, change the size of such surface or subsurface facilities on the Leased Premises that Lessee determines necessary or desirable for Lessee’s storage operations, including, but not limited to fences, pipelines, tanks, reservoirs, electric and communication lines, roadways, underground facilities and equipment, surface facilities and equipment, buildings, structures and other such facilities and appurtenances.”

“They can put whatever they want on the surface of our land, WITHOUT LIMITATION if we were to sign their highly one-sided lease,” Swenson wrote. “They can also pay us whatever they want for surface damages and we can’t stop them from building on our surface lands if we don’t agree with their financial offer. Our only option is to sue them at that point.”

Swenson then requested that Harris retract his comment, as it portrays Swenson as untruthful.

Harris responded to Swenson’s request, writing “The permits we have filed clearly state the purpose of this project – capturing CO2 before it’s emitted into the atmosphere, transporting the CO2 through a pipeline system, and permanently sequestering it in North Dakota. If there was another purpose, it would be required to be included in the permits we are seeking.”

Finally, Harris wrote that he doesn't think it’s accurate that my previous article implied that Summit was not negotiating in good faith.

I believe Harris is referring to the section stating, “In January 2022, Swenson said he provided Summit with a counter-offer lease, but Summit has not yet provided formal changes to their originally proposed lease. Swenson said he thinks Summit is planning on forcing landowners to give up their pore space.”

Harris wrote that Summit has paid $215 million in easements so far, showing that Summit is paying fair market value. He did not specify how many easements are included in the payments.

“We are incredibly encouraged that the company has secured agreements for 85% of the proposed sequestration area in North Dakota or 130,000 total acres and more are signing every day,” Harris wrote.

Editor’s note: However, the Richland County Commission unanimously passed a resolution that they “officially oppose eminent domain for the Summit Carbon Solutions Pipeline within Richland County, North Dakota."

The county commission of neighboring Sargent County passed a similar resolution, as did McPherson County in South Dakota. At least four other counties are considering officially opposing eminent domain.








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