Sitton Leaving Consulting Firm to Avoid Conflicts

Ryan Sitton, the incoming Texas railroad commissioner, says he is following through on a campaign promise to step away from his oil and gas consulting firm and place its assets in a blind trust – an effort aimed at reducing the appearance of a conflict of interest.

"These steps will make sure that the citizens of the state of Texas are confident as I go to work for them,” the Republican said in a statement Tuesday. “My time, energy and passion will be focused on utilizing my energy experience to help the Railroad Commission be as efficient and effective as it can be, and in turn, make all Texans confident in how our state’s energy industry is operating.” 

Sitton, of Friendswood, cruised to victory last month in the race for Commissioner Barry Smitherman’s open seat on the three-member oil and gas regulator. He will be sworn in next month.

Sitton faced criticism during the Republican primary from some of his opponents and state Rep. Jim Keffer, chairman of the House Energy Resources Committee, after announcing his initial plans to stay on at the fast-growing firm he and his wife founded.

The firm, Pinnacle Asset Integrity Services, consults with some of the world’s biggest oil, gas and petrochemical companies. Sitton and his supporters said his original plan was not problematic because Pinnacle usually contracted with divisions of oil and gas companies that don’t typically appear before the Railroad Commission. But critics argued that staying at the company could jeopardize the reputation of an agency that already toes the line between industry champion and watchdog.

By April, Sitton had promised to step down from his position as president and CEO and place his assets in a blind trust, saying he was going “beyond what is required by the statutes” to “avoid even the appearance of a conflict.”

“I didn’t need to serve on the Railroad Commission for our company to be successful and I’m not running because I need a job,” he said at the time. 

Sitton's last day at the firm is Jan. 2, his spokesman said Tuesday.

That route is similar to the one Commissioner David Porter took after voters elected him in 2010. He stepped away from his accounting firm, which catered to oil and gas companies, and shed stock in any companies that dealt directly with the agency.

As is typical with Texas railroad commissioners, most of Sitton’s biggest donors represent the petroleum or pipeline industry. Those who contributed more than $25,000 include Chris Faulkner, CEO of Breitling Energy; Kelcy Warren, CEO of Energy Transfer Partners; S. Javaid Anwar, CEO of Midland Energy; Robert Beecherl, co-founder of Piedra Resources LLC; and Donny McClure, President and CEO of McClure Oil.

Texas lawmakers have increasingly scrutinized the financing of railroad commissioner campaigns. During last session’s “sunset” process — the periodic review of a state agency — the Legislature debated several campaign finance reforms for commissioners, which ultimately failed. The sitting commissioners argued that new rules would subject them to different standards than other statewide officeholders face.

Sitton has promised to either recuse himself from a vote or disclose any conflicts that crop up.