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04 Nov 2020 | 05:33 UTC — Washington
Highlights
Oil field services firm owner opposes new flaring limits
Opponent urges producers to 'stop wasting energy'
A Republican opposed to tighter restrictions on natural gas flaring holds a lead in the race for an open seat on the three-member Texas Railroad Commission, which regulates oil and gas drillers.
Jim Wright, owner of several South Texas oilfield services firms, had 53% of the vote with 55% of polling locations reporting, according to preliminary results from the Texas Secretary of State, compared with Democrat Chrysta Castaneda's 43%.
Wright opposes tougher limits on flaring, which surged in 2019 as oil producers wanted to keep pumping but lacked access to pipelines to move associated gas volumes.
He beat high-profile incumbent Ryan Sitton by more than 10 points in a primary runoff.
Castaneda, a Dallas energy lawyer, promised to clamp down on flaring, saying in campaign videos: "Let's stop wasting energy."
The commission was at the center of a debate this spring over whether Texas should impose supply curtailments on oil producers in the face of a global oil price crash. Commissioners heard testimony on the proposal but ultimately decided not to impose restrictions as drillers were already voluntarily shutting in as much as 2.5 million b/d.
US producers have returned about 1 million b/d in shut-in production since May, but low drilling activity from massive capital spending cuts will lead to production declines until late 2021, according to S&P Global Platts Analytics.
Platts Analytics expects US oil production to contract by 1 million b/d this year and next year to average 11.3 million b/d in 2020 and 10.3 million b/d in 2021. It sees output recovering gradually to pre-pandemic rates of 12.8 million b/d by late 2023.