Alex Mills
By Alex Mills
The run-off election for Texas Railroad Commissioner has heated up recently with two former commissioners endorsing a candidate and the chairman of the House Energy Resources Committee raising the conflict-of-interest issue on the same candidate.
Before getting too far into the issues, a little background:
- The Railroad Commission (RRC) doesn’t regulate railroads anymore. It is the primary regulatory agency over the oil and gas industry.
- The RRC has three commissioners that are elected statewide for six-year terms. One commissioner is up for election every two years. This year, Chairman Barry Smitherman decided not to seek re-election to the RRC, but he ran for Attorney General, and he placed third in a three-man race.
- Four candidates sought the Republican nomination in March and two – Wayne Christian and Ryan Sitton – are in the run off on May 27.
Sitton, an engineer from Houston, does work in the oil and gas industry and apparently most of his company’s clients come from oil and gas. Recently, Smitherman and Elizabeth Ames Jones, a former RRC commissioner, endorsed Sitton during separate events.
By the way, Sitton finished a distant second in the general election to former state Rep. Wayne Christian, a financial planner from Center, Tx.
Christian raised the conflict-of-interest issue against Sitton, saying that if Sitton were elected he possibly would have to make a decision on a case involving a client.
State Rep. Jim Keffer (R-Eastland), chairman of the House Energy Resources Committee, got into the debate when he agreed with Christian that there could possibly be a conflict-of-interest issue if Sitton were elected.
Sitton maintained that he will have no conflict of interest issues because his company, PinnacleAIS “does zero work that is regulated by the RRC. We’ve never had a contested case go before the commission. We’ve never had any interaction with the RRC.”
Some believe that Sitton’s qualifications (an engineer with oil and gas experience) would be a plus in sorting out complicated oil and gas issues.
However, the controversy seemed to overtake the other issues in the campaign so on April 17 Sitton announced that he would place his company in a blind trust. He also promised that he would step down as president and chief executive officer of PinnacleAIS, in an attempt to put the conflict-of-interest questions to rest.
The question concerning the ability of anyone who is in the oil and gas industry to serve on the agency that regulated the oil and gas industry remains. It is an issue that has been debated since the first days that President Jimmy Carter created the Department of Energy (DOE). Of course, President Carter believed in appointing just about anyone who had little knowledge about energy.
And that’s what the nation got: an energy policy based on a bunch of misconceptions and half-truths that resulted in price controls, windfall profits tax, Endangered Species Act, and on and on.
Texas, on the other hand, has been blessed, for the most part, with laws and regulations that encourages the development of its natural resources, and it has given the RRC the responsibility to regulate the oil and gas industry.
No one really knows for certain if Ryan Sitton would have conflict-of-interest issues if he were elected. However, commissioners always have the ability to recuse themselves on occasion when they believe that there may have a conflict-of-interest issue.
It is somehow ironic that it is controversial that a candidate, who works in the oil and gas industry, might possibly have a perceived conflict of interest as one of three commissioners, yet the Texas Legislature makes the oil and gas industry fund the Railroad Commission through fees and fines in addition to all of the taxes the industry pays.
The debate goes on.
By the way, Sitton and Christian have agreed to be on the stage together on Wednesday at the 84th Texas Alliance of Energy Producers Expo and Annual Meeting breakfast in Wichita Falls.
Alex Mills is President of the Texas Alliance of Energy Producers. The opinions expressed are solely of the author.
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