Tribal sovereignty and self-determination can be exercised in different ways, from restoring languages and culture to reclaiming lands lost over time. But few are as important to nation building as putting valuable natural resources on tribal land to their highest and best use.
This is “mineral sovereignty,” and it pays rich dividends to the tribes that practice it.
The Wind River tribes offer an apt example. When the lease expired on their 940-acre Circle Ridge Oil Field, they didn’t renew it or look for another lessee. With technical assistance from the Department of Interior’s Division of Energy and Mineral Development, they took it over themselves.
As a result of the tribes asserting their sovereignty, there are now plans in place to increase productivity of the field five-fold -- from 2,000 barrels per day when the field was under lease to 10,000 barrels per day. The tribes are keeping the 29 percent royalty rate it enjoyed under the lease but are retaining the operating profits by leveraging their immunity from payment of state and federal taxes. They quickly achieved 97 percent of historic production while operating just 48 of the field’s original 81 wells (33 have been retired).
Grinding Rock Aggregates (GRA), the construction aggregate operation of the Ft. Independence Paiute Tribe of California, furnishes another example. Not only does GRA mine their own gravel, but they refine it, market it, and even run a trucking company to deliver it. In other words, they do it all themselves, taking advantage of every opportunity for profit.
GRA’s success is demonstrating to other mineral-rich tribes the value of starting their own vertically integrated quarry companies. On most reservations, tribes lease valuable minerals to outsiders in return for royalty payments, abandoning to non-tribal lessees and suppliers the greater share of profits from mining, refining, selling, and delivering their minerals. This strategy has given GRA greater control of all stages of production, improving supply chain coordination, capturing downstream profits, expanding core competencies, and creating more jobs for tribal members.
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