North Dakota 69-2025 Assembly Status: Enacted 3 R cosponsors

SB 2397 — Relating to a limited exemption for development incentive wells; to amend and reenact sections 57‑51‑02.6, 57‑51‑05, and 57‑51.1‑01 of the North Dakota Century Code, relating to the temporary exemption for oil and gas wells employing a system to avoid flaring, an exemption from gross production tax for gas produced from certain enhanced oil recovery projects, and the definition of development incentive well; to provide an effective date; and to provide an expiration date.

Last action — Filed with Secretary Of State 05/06

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  1. ✓
    Introduced
  2. ✓
    In Committee
  3. ✓
    Passed Senate
  4. ✓
    Passed House
  5. ✓
    To Executive
  6. 6
    Enacted

This bill has been enacted into law. Introduced January 27, 2025. Enacted.

Signed by Governor Kelly Armstrong (Republican) on May 17, 2025.

Prognosis

Likely to advance 78% · moderate confidence

Where this bill stands today.

Odds of enactment

High

How often bills like it became law.

  • Enacted

    Current position in the legislative process.

  • 4 sponsors

    1 primary, 3 co-sponsors signed on.

  • Single-party support

    Sponsorship is currently within one party (3 R).

  • Cleared a recorded vote

    Passed 3 recorded votes so far.

Prognosis reads this bill's own signals — stage, sponsorship breadth, committee status, recorded votes and cross-state momentum. Odds come from a model trained on which bills have become law.

In plain language

The bill provides temporary tax exemptions for certain oil and gas wells in North Dakota.

This bill amends North Dakota laws to create temporary exemptions from gross production tax for specific oil and gas wells. It includes provisions for wells using systems to avoid flaring and enhanced oil recovery projects.

What this means for you
  • Small Business: This bill may help small businesses in the oil and gas sector by providing tax relief.

Summary

AN ACT to create and enact a new subsection to section 57-51.1-03 of the North Dakota Century Code, relating to a limited exemption for development incentive wells; to amend and reenact sections 57-51-02.6, 57-51-05, and 57-51.1-01 of the North Dakota Century Code, relating to the temporary exemption for oil and gas wells employing a system to avoid flaring, an exemption from gross production tax for gas produced from certain enhanced oil recovery projects, and the definition of development incentive well; to provide an effective date; and to provide an expiration date.

Bill Text

What changed in the latest version

230 added · 290 removed

Plain-language change summary

The latest version of Bill SB 2397 includes new provisions that create a limited exemption for development incentive wells and revisions to the temporary exemption for oil and gas wells that prevent gas flaring. Specifically, gas will remain tax-exempt for just over two years if it is effectively used on-site or converted into other valuable products. These changes aim to support more efficient use of natural gas and promote environmentally responsible practices in the oil and gas sector, which can have positive economic implications for the state.

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Previous
Latest
25.1360.01008 Adopted by the Conference Committee Title.03000 April 28, 2025 Sixty-ninth Legislative Assembly of North Dakota PROPOSED AMENDMENTS TO SENATE BILL NO.
Sixty-ninth Legislative Assembly of North Dakota In Regular Session Commencing Tuesday, January 7, 2025 SENATE BILL NO.
2397 Introduced by Senators Enget, Sorvaag, Sickler Representative Kempenich In place of amendment (25.1360.01005) adopted by the House, Senate Bill No.
2397 (Senators Enget, Sorvaag, Sickler) (Representative Kempenich) AN ACT to create and enact a new subsection to section 57-51.1-03 of the North Dakota Century Code, relating to a limited exemption for development incentive wells;
2397 is amended by amendment (25.1360.01008) as follows:
A BILL for an Act to amend and reenact subdivision f of subsection 4 of section 24-02-37.3, subsection 4 of section 54-27-19.4, subdivision c of subsection 4 of section 57-51.1-07.7, and subdivision b of subsection 6 of section 57-51.1-07.8 of the North Dakota Century Code, relating to the definition of non-oil-producing county for purposes of the flexible transportation fund, legacy earnings township aid fund, municipal infrastructure fund, and county and township infrastructure fund;
to provide an effective date;
and to declare an emergency.for an Act to create and enact a new subsection to section 57-51.1-03 of the North Dakota Century Code, relating to a limited exemption for development incentive wells;
Subdivision f of subsection 4 of section 24-02-37.3 of the North Dakota Century Code is amended and reenacted as follows:
f.
For purposes of this subsection, "non-oil-producing county" means a county that received no allocation of funding or a total allocation of less than five million dollars under subsection 2 of section 57-51-15 inhad average annual oil production of fewer than ten million barrels based on the average annual oil Page No.
1 25.1360.01008 Sixty-ninth Legislative Assembly production in the three-year period ending with the most recently completed even-numbered fiscal year before the start of each biennium.
SECTION 2.
AMENDMENT.
Subsection 4 of section 54-27-19.4 of the North Dakota Century Code is amended and reenacted as follows:
4.
For purposes of this section, "non-oil-producing county" means a county that received no allocation of funding or a total allocation of less than five million dollars under subsection 2 of section 57-51-15 inhad average annual oil production of fewer than ten million barrels based on the average annual oil production in the three-year period ending with the most recently completed even-numbered fiscal year before the start of each biennium.
SECTION 3.
AMENDMENT.
Subdivision c of subsection 4 of section 57-51.1-07.7 of the North Dakota Century Code is amended and reenacted as follows:
c.
"Non-oil-producing county" means a county that received no allocation of funding or a total allocation of less than five million dollars under subsection 2 of section 57-51-15 inhad average annual oil production of fewer than ten million barrels based on the average annual oil production in the three-year period ending with the most recently completed even-numbered fiscal year before the start of each biennium.
SECTION 4.
AMENDMENT.
Subdivision b of subsection 6 of section 57-51.1-07.8 of the North Dakota Century Code is amended and reenacted as follows:
b.
"Non-oil-producing county" means a county that received no allocation of funding or a total allocation of less than five million dollars under subsection 2 of section 57-51-15 inhad average annual oil production of fewer than ten million barrels based on the average annual oil production in the three-year period ending with the most recently completed even-numbered fiscal year before the start of each biennium.
SECTION 5.
EFFECTIVE DATE.
This Act becomes effective on July 1, 2025.
SECTION 6.
EMERGENCY.
This Act is declared to be an emergency measure.
SECTION 1.
AMENDMENT.
Page No.
57-51-02.6.
2 25.1360.01008 Sixty-ninth Legislative Assembly 57-51-02.6.
Page No.
2.
3 25.1360.01008 Sixty-ninth Legislative Assembly 2.
On oil or gas produced and sold, the gross production tax thereon must be paid by the purchaser, and the purchaser is authorized to deduct in making settlement with the producer S.
On oil or gas produced and sold, the gross production tax thereon must be paid by the purchaser, and the purchaser is authorized to deduct in making settlement with the producer or royalty owner, the amount of tax paid;
B.
NO.
2397 - PAGE 2 or royalty owner, the amount of tax paid;
Show all 75 changed rows (35 more)
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Latest
Page No.
SECTION 3.
4 25.1360.01008 Sixty-ninth Legislative Assembly SECTION 3.
3.
S.
B.
NO.
2397 - PAGE 3 3.
A producer shall treat as a separate property each separate and distinct producing reservoir subject to the same right to Page No.
A producer shall treat as a separate property each separate and distinct producing reservoir subject to the same right to produce crude oil;
5 25.1360.01008 Sixty-ninth Legislative Assembly produce crude oil;
"Restimulation well" means a previously completed oil or gas well that, following completion and production of oil, has been treated with an application of fluid under Page No.
"Restimulation well" means a previously completed oil or gas well that, following completion and production of oil, has been treated with an application of fluid under pressure for the purpose of initiating or propagating fractures in a target geologic formation to enhance production of oil.
6 25.1360.01008 Sixty-ninth Legislative Assembly pressure for the purpose of initiating or propagating fractures in a target geologic formation to enhance production of oil.
b.
S.
B.
NO.
2397 - PAGE 4 b.
Wells which did not actually yield or produce oil during the qualifying twelve-month period, including Page No.
Wells which did not actually yield or produce oil during the qualifying twelve-month period, including disposal wells, dry wells, spent wells, and shut-in wells, are not production wells for the purpose of determining whether the stripper well property exemption applies.
7 25.1360.01008 Sixty-ninth Legislative Assembly disposal wells, dry wells, spent wells, and shut-in wells, are not production wells for the purpose of determining whether the stripper well property exemption applies.
(b) An operator with between one hundred and one hundred forty-nine wells within the Bakken or Three Forks formations which have been:
S.
B.
NO.
2397 - PAGE 5 (b) An operator with between one hundred and one hundred forty-nine wells within the Bakken or Three Forks formations which have been:
or Page No.
or [2] Drilled during the period beginning July 1, 2023, and ending June 30, 2025, and acquired by the operator.
8 25.1360.01008 Sixty-ninth Legislative Assembly [2] Drilled during the period beginning July 1, 2023, and ending June 30, 2025, and acquired by the operator.
Page No.
S.
9 25.1360.01008
B.
NO.
2397 - PAGE 6 ____________________________ ____________________________ President of the Senate Speaker of the House ____________________________ ____________________________ Secretary of the Senate Chief Clerk of the House This certifies that the within bill originated in the Senate of the Sixty-ninth Legislative Assembly of North Dakota and is known on the records of that body as Senate Bill No.
2397.
Senate Vote:
Yeas 42 Nays 4 Absent 1 House Vote:
Yeas 85 Nays 5 Absent 4 ____________________________ Secretary of the Senate Received by the Governor at ________M.
on _____________________________________, 2025.
Approved at ________M.
on __________________________________________________, 2025.
____________________________ Governor Filed in this office this ___________day of _______________________________________, 2025, at ________ o’clock ________M.
____________________________ Secretary of State
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How this bill changes current law

4 changes Share ↗

Compared against current U.S. Code AI-generated reading aid — verify against the official bill.

The bill amends the laws related to exemptions for certain oil and gas production under North Dakota law.

  • N.D.C.C. § 57-51-02.6

    that consumes gas from the well → that consumes at least seventy-five percent of the gas from the well

    The requirement for electrical generators at the well site is altered to specify that they must consume at least 75% of the gas from the well.

  • N.D.C.C. § 57-51-05

    thereforefor → therefore

    The text is corrected to remove an extra 'for' in the phrase, clarifying the language on tax payment extensions.

  • N.D.C.C. § 57-51-05

    that produces oil and gas. → that produces oil and gas. The exemption under this subdivision applies to all enhanced oil recovery projects created and established by the industrial commission after June 30, 2025, and for any gas produced after the date of first production following initial injection of gas until all gas injected as part of the enhanced oil recovery project has been recovered from the reservoir being tested or unitized.

    Clarifies the exemption for gas produced from enhanced oil recovery projects, establishing specific conditions for its application.

  • N.D.C.C. § 57-51.1-01

    As defined and determined by rule adopted by the industrial commission in furtherance of its authority under chapter 38-08. → that has not been previously utilized with demonstrated success by the operator within the specific formation targeted for development by that operator;

    Defines 'development incentive well' with clearer stipulations regarding drilling techniques and operational success.

Action History

  1. Filed with Secretary Of State 05/06

  2. Signed by Governor 05/05

  3. Sent to Governor

  4. Signed by President

  5. Signed by Speaker

  6. Second reading, passed as amended, yeas 85 nays 5

  7. Conference committee report adopted

  8. Reported back from conference committee, in place of, placed on calendar

  9. Second reading, passed, yeas 42 nays 4

  10. Conference committee report adopted

  11. Reported back from conference committee, in place of, placed on calendar

  12. Conference committee appointed Dockter Porter J. Olson

  13. Conference committee appointed Patten Rummel Sickler

  14. Refused to concur

  15. Returned to Senate (12)

  16. Second reading, passed as amended, yeas 89 nays 5

  17. Amendment adopted, placed on calendar

  18. Reported back amended, do pass, amendment placed on calendar 14 0 0

  19. Committee Hearing 10:30

  20. Introduced, first reading, (emergency), referred Finance and Taxation Committee

  21. Received from Senate

  22. Second reading, passed, yeas 46 nays 0, Emergency clause carried

  23. Reported back, do pass, place on calendar 5 0 1

  24. Committee Hearing 10:30

  25. Introduced, first reading, (emergency), referred Finance and Taxation Committee

Sponsors

Sponsorship breakdown

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1 sponsors · 3 co-sponsors · 144 not signed on · 6 voted No

Sponsors (1)

Co-sponsors (3)

Not signed on (144)

144 members have not signed on to this bill.

Show all 144 →

"Not signed on" means a member has not sponsored or co-sponsored this bill — it does not imply opposition. Members flagged Voted No have a recorded No vote on this bill.

Whip count is in markup. Polling the chamber and every recorded vote this session. Only the first open is slow. It’s instant for you after this. Calling the roll · Tallying · Engrossing

Votes

Final Passage

Passed 85 Yea · 5 Nay · 4 Other
Party YeaNayPresentNot Voting
Republican 78004
Democratic 6500
Unaffiliated 1000
Total 85504
% of votes cast 90%5%0%4%
How each member voted (94)
Member Party Vote
Olson — Yea
Brown, Collette Democratic Nay
Conmy, Liz Democratic Yea
Davis, Jayme Democratic Nay
Dobervich, Gretchen Democratic Yea
Finley-DeVille, Lisa Democratic Nay
Foss, Austin Democratic Yea
Hager, LaurieBeth Democratic Nay
Hanson, Karla Rose Democratic Yea
Ista, Zachary Democratic Yea
Mitskog, Alisa Democratic Yea
Schneider, Mary Democratic Nay
Anderson, Bert Republican Yea
Anderson, Dick Republican Yea
Anderson, Karen A. Republican Yea
Bahl, Landon Republican Yea
Beltz, Mike Republican Yea
Berg, Mike Republican Yea
Bolinske, Macy Republican Yea
Bosch, Glenn Republican Yea
Brandenburg, Mike Republican Yea
Brown, TJ Republican Yea
Christianson, Nels Republican Yea
Dockter, Jason Republican Yea
Dressler, Ty Republican Yea
Fegley, Clayton Republican Yea
Fisher, Jay Republican Yea
Frelich, Kathy Republican Yea
Grindberg, Karen Republican Yea
Grueneich, Jim Republican Yea
Hagert, Jared C. Republican Yea
Hatlestad, Patrick R. Republican Yea
Hauck, Dori Republican Yea
Headland, Craig Republican Yea
Heilman, Matthew Republican Yea
Heinert, Pat D. Republican Not Voting
Henderson, Donna Republican Yea
Hendrix, Jared Republican Yea
Holle, Dawson Republican Yea
Hoverson, Jeff Republican Yea
Johnson, Jorin Republican Yea
Johnston, Daniel Republican Yea
Jonas, Jim Republican Yea
Karls, Karen Republican Yea
Kasper, Jim Republican Not Voting
Kempenich, Keith Republican Yea
Kiefert, Dwight Republican Yea
Klemin, Lawrence R. Republican Yea
Koppelman, Ben Republican Yea
Lefor, Mike Republican Yea
Longmuir, Donald W. Republican Yea
Louser, Scott Republican Yea
Maki, Roger A. Republican Yea
Marschall, Andrew Republican Not Voting
Martinson, Bob Republican Yea
McLeod, Carrie Republican Yea
Meier, Lisa Republican Yea
Monson, David Republican Yea
Morton, Desiree Republican Yea
Motschenbacher, Mike Republican Yea
Murphy, Eric J. Republican Yea
Nathe, Mike Republican Yea
Nehring, Dennis Republican Yea
Nelson, Jon O. Republican Yea
Novak, Anna S. Republican Yea
O'Brien, Emily Republican Yea
Olson, Jeremy Republican Yea
Osowski, Doug Republican Yea
Ostlie, Mitch Republican Yea
Porter, Todd Republican Yea
Pyle, Brandy L. Republican Yea
Richter, David Republican Yea
Rios, Nico Republican Yea
Rohr, Karen M. Republican Yea
Ruby, Dan Republican Yea
Ruby, Matthew Republican Not Voting
Sanford, Mark Republican Yea
Satrom, Bernie Republican Yea
Schatz, Mike Republican Yea
Schauer, Austen Republican Yea
Schreiber-Beck, Cynthia Republican Yea
Steiner, Vicky Republican Yea
Stemen, Gregory Republican Yea
Swiontek, Steve Republican Yea
Toman, Nathan Republican Yea
Tveit, Bill Republican Yea
VanWinkle, Lori Republican Yea
Vetter, Steve Republican Yea
Vigesaa, Don Republican Yea
Vollmer, Daniel R. Republican Yea
Wagner, Scott Republican Yea
Warrey, Jonathan Republican Yea
Weisz, Robin Republican Yea
Wolff, Christina Republican Yea

Official roll call →

Final Passage

Passed 89 Yea · 5 Nay
Party YeaNayPresentNot Voting
Republican 82000
Democratic 6500
Unaffiliated 1000
Total 89500
% of votes cast 95%5%0%0%
How each member voted (94)
Member Party Vote
Olson — Yea
Brown, Collette Democratic Nay
Conmy, Liz Democratic Nay
Davis, Jayme Democratic Nay
Dobervich, Gretchen Democratic Yea
Finley-DeVille, Lisa Democratic Nay
Foss, Austin Democratic Yea
Hager, LaurieBeth Democratic Nay
Hanson, Karla Rose Democratic Yea
Ista, Zachary Democratic Yea
Mitskog, Alisa Democratic Yea
Schneider, Mary Democratic Yea
Anderson, Bert Republican Yea
Anderson, Dick Republican Yea
Anderson, Karen A. Republican Yea
Bahl, Landon Republican Yea
Beltz, Mike Republican Yea
Berg, Mike Republican Yea
Bolinske, Macy Republican Yea
Bosch, Glenn Republican Yea
Brandenburg, Mike Republican Yea
Brown, TJ Republican Yea
Christianson, Nels Republican Yea
Dockter, Jason Republican Yea
Dressler, Ty Republican Yea
Fegley, Clayton Republican Yea
Fisher, Jay Republican Yea
Frelich, Kathy Republican Yea
Grindberg, Karen Republican Yea
Grueneich, Jim Republican Yea
Hagert, Jared C. Republican Yea
Hatlestad, Patrick R. Republican Yea
Hauck, Dori Republican Yea
Headland, Craig Republican Yea
Heilman, Matthew Republican Yea
Heinert, Pat D. Republican Yea
Henderson, Donna Republican Yea
Hendrix, Jared Republican Yea
Holle, Dawson Republican Yea
Hoverson, Jeff Republican Yea
Johnson, Jorin Republican Yea
Johnston, Daniel Republican Yea
Jonas, Jim Republican Yea
Karls, Karen Republican Yea
Kasper, Jim Republican Yea
Kempenich, Keith Republican Yea
Kiefert, Dwight Republican Yea
Klemin, Lawrence R. Republican Yea
Koppelman, Ben Republican Yea
Lefor, Mike Republican Yea
Longmuir, Donald W. Republican Yea
Louser, Scott Republican Yea
Maki, Roger A. Republican Yea
Marschall, Andrew Republican Yea
Martinson, Bob Republican Yea
McLeod, Carrie Republican Yea
Meier, Lisa Republican Yea
Monson, David Republican Yea
Morton, Desiree Republican Yea
Motschenbacher, Mike Republican Yea
Murphy, Eric J. Republican Yea
Nathe, Mike Republican Yea
Nehring, Dennis Republican Yea
Nelson, Jon O. Republican Yea
Novak, Anna S. Republican Yea
O'Brien, Emily Republican Yea
Olson, Jeremy Republican Yea
Osowski, Doug Republican Yea
Ostlie, Mitch Republican Yea
Porter, Todd Republican Yea
Pyle, Brandy L. Republican Yea
Richter, David Republican Yea
Rios, Nico Republican Yea
Rohr, Karen M. Republican Yea
Ruby, Dan Republican Yea
Ruby, Matthew Republican Yea
Sanford, Mark Republican Yea
Satrom, Bernie Republican Yea
Schatz, Mike Republican Yea
Schauer, Austen Republican Yea
Schreiber-Beck, Cynthia Republican Yea
Steiner, Vicky Republican Yea
Stemen, Gregory Republican Yea
Swiontek, Steve Republican Yea
Toman, Nathan Republican Yea
Tveit, Bill Republican Yea
VanWinkle, Lori Republican Yea
Vetter, Steve Republican Yea
Vigesaa, Don Republican Yea
Vollmer, Daniel R. Republican Yea
Wagner, Scott Republican Yea
Warrey, Jonathan Republican Yea
Weisz, Robin Republican Yea
Wolff, Christina Republican Yea

Official roll call →

Final Passage

Passed 46 Yea · 0 Nay · 1 Other
Party YeaNayPresentNot Voting
Republican 40001
Democratic 5000
Unaffiliated 1000
Total 46001
% of votes cast 98%0%0%2%
How each member voted (47)
Member Party Vote
van Oosting — Yea
Boschee, Josh Democratic Yea
Braunberger, Ryan Democratic Yea
Hogan, Kathy Democratic Yea
Marcellais, Richard Democratic Yea
Mathern, Tim Democratic Yea
Axtman, Michelle Republican Yea
Barta, Jeff Republican Yea
Beard, Todd Republican Yea
Bekkedahl, Brad Republican Yea
Boehm, Keith Republican Yea
Burckhard, Randy A. Republican Yea
Castaneda, Jose L. Republican Yea
Cleary, Sean Republican Yea
Clemens, David A. Republican Yea
Conley, Cole Republican Yea
Cory, Claire Republican Yea
Davison, Kyle Republican Yea
Dever, Dick Republican Yea
Dwyer, Michael Republican Yea
Enget, Mark Republican Yea
Erbele, Robert Republican Yea
Gerhardt, Justin Republican Yea
Hogue, David Republican Yea
Kessel, Greg Republican Not Voting
Klein, Jerry Republican Yea
Larson, Diane Republican Yea
Lee, Judy Republican Yea
Lemm, Randy D. Republican Yea
Luick, Larry Republican Yea
Magrum, Jeffery J. Republican Yea
Meyer, Scott Republican Yea
Myrdal, Janne Republican Yea
Patten, Dale Republican Yea
Paulson, Bob Republican Yea
Powers, Michelle Republican Yea
Roers, Kristin Republican Yea
Rummel, Dean Republican Yea
Schaible, Donald Republican Yea
Sickler, Jonathan Republican Yea
Sorvaag, Ronald Republican Yea
Thomas, Paul J. Republican Yea
Walen, Chuck Republican Yea
Wanzek, Terry M. Republican Yea
Weber, Mark F. Republican Yea
Weston, Kent Republican Yea
Wobbema, Mike Republican Yea

Official roll call →

Subjects

taxation energy
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Frequently asked questions

What does SB 2397 do?
AN ACT to create and enact a new subsection to section 57-51.1-03 of the North Dakota Century Code, relating to a limited exemption for development incentive wells; to amend and reenact sections 57-51-02.6, 57-51-05, and 57-51.1-01 of the North Dakota Century Code, relating to the temporary exemption for oil and gas wells employing a system to avoid flaring, an exemption from gross production tax for gas produced from certain enhanced oil recovery projects, and the definition of development incentive well; to provide an effective date; and to provide an expiration date.
Who sponsors SB 2397?
SB 2397 is sponsored by Enget, Mark (Republican), Sickler, Jonathan (Republican), Sorvaag, Ronald (Republican), and Rep. Kempenich, Keith.
What is the current status of SB 2397?
This bill has been enacted into law. Introduced January 27, 2025. Enacted.
Where can I track SB 2397?
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