03-05-2025
Lawmakers pass bill promoting rare earth mineral development in North Dakota
Rep. Dick Anderson, R-Willow City, talks to a colleague on May 1, 2025, in the House chamber. (Kyle Martin/For the North Dakota Monitor)
A bill that intends to keep North Dakota on the forefront of rare earth mineral development is on its way to the governor after lengthy debate Friday.
Rep. Dick Anderson, R-Willow City, the sponsor of House Bill 1459, said the bill is needed to position North Dakota for a facility to process rare earth minerals, which can be embedded with coal that is already slated for mining. He said there could be federal funding for such a facility.
The bill passed the House 63-26 and then the Senate 27-19.
China supplies most of the rare earth minerals needed for electronics. Scott Meyer, R-Grand Forks, supported the bill in the interest of national security and not being reliant on China.
For many opponents, a major sticking point on the bill was language that set a royalty payment for mineral rights owners at 2.5% on the rare earth minerals found within a coal seam. That would be on top of the royalty payment that had been negotiated in the coal lease.
Sen. Brad Bekkedahl, R-Williston, said the bill denies the rights of mineral owners to negotiate with coal companies.
'I would want to have the ability to negotiate another lease,' Bekkedahl said.
Rare earth minerals seen as a rare opportunity in North Dakota
The Northwest Landowners Association, which represents property owners with coal leases, argued that the royalty provision was unconstitutional.
Several House members agreed with that sentiment when the conference committee report was presented on the House floor Thursday morning. The bill was sent back to the conference committee for more work.
Members of the conference committee said the royalty was in the best interest of mineral owners to ensure they get some compensation for the rare earth minerals.
Sen. Dale Patten, R-Watford City, said the rare earth minerals are part of the coal.
He said the royalty provision 'is a way for that mineral owner to realize revenue,' and without it they may get nothing.
Patten noted that coal companies can make the legal argument that the coal leases already cover development of rare earth minerals.
Language was added to the bill at the recommendation of Rep. Lawrence Klemin, R-Bismarck, who is an attorney, specifying that mineral owners and the coal companies could renegotiate the terms of the lease.
Klemin said the change addressed some of his concerns but not all of them. He said the bill retroactively changing existing leasing was troubling.
Anderson said the technology is improving to extract rare earth minerals from the ash of coal that has already been burned, known as fly ash.
While that process is more expensive, he said if that happens, the mineral owners could get nothing.
'If you get too greedy, you lose,' Anderson said in a conference committee meeting Friday.
Rep. Todd Porter, R-Mandan, said litigation was 'inevitable' but passing the bill helps frame the issues for the court system and 'provides clarity and certainty to industry' that will make them more likely to invest in rare earth mineral processing in the state.
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