Republican Candidate Says he Won’t Give Up Energy Business

By Joshua Fechter – Houston Chronicle April 1, 2014 | Updated: April 1, 2014 10:42pm –

Ryan Sitton

Ryan Sitton

AUSTIN – A Republican candidate seeking a post that regulates the state’s oil and gas industry said he won’t cut ties to his energy business if elected to the Texas Railroad Commission – a state board that historically has had a poor track record disentangling itself from industry interests.

Ryan Sitton is co-founder and chief executive officer of PinnacleAIS, which advises companies about maintenance of equipment used in oil and gas operations.

Sitton said he will maintain an ownership stake in Pinnacle­AIS if he becomes a commission board member – a declaration that raised questions by his GOP and Democratic opponent, ethics experts and tea party Republicans.

“That is a conflict of interest and it is very frightful,” said Wayne Christian, a former state representative also seeking the post.

Financial entanglements between state oil and gas regulators and those they regulate aren’t anything new, but they’re still egregious, said Craig McDonald, director of Texans for Public Justice.

“Time and time again, you see that much of their money comes from the very companies that they regulate,” McDonald said.

Sitton and Christian are jostling to fill a seat on the three-member panel being vacated by outgoing Railroad Commission Chairman Barry Smitherman. The GOP runoff is May 27.

Sitton pushed back against the conflict of interest accusation.

“Our company does zero work that is regulated by the Railroad Commission,” he said. “We’ve never had a contested case go before the commission. We’ve never had any interaction with the Railroad Commission.”

But that doesn’t mean his company’s clients – which have included Valero Energy Corp. and Chevron USA Inc. – won’t appear before the board.

Sitton admits that’s a possibility, and he said recusing himself from votes concerning clients could be an option.

Still, Sitton said he will continue to monitor the company’s progress when he is not operating as railroad commissioner.

That doesn’t sit well with some.

Tom “Smitty” Smith, Texas director of Public Citizen, said there isn’t much stopping Sitton from voting in favor of clients. “If somebody’s got a contract with Exxon or the Koch brothers or T. Boone Pickens, who do you think he’s going to rule for?” Smith said. “The people who are paying his consulting contracts he relies on to pay his bills, or the general public?”

As a commissioner, Sitton would receive $175,300 annually in addition to income from PinnacleAIS.

Sitton’s position could hurt his effort to court tea party voters who are skeptical of officials with feet in both the regulatory and business camps, said Mark Jones, political scientist at Rice University.

“That seems like a profound strategy error,” Jones said. “Whether or not you’re going to do it, you certainly don’t say it.”

 

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