March 28 (UPI) — The state energy regulator in Texas said it was looking to cut back on some regulations in order to stimulate the economy through increased production.
The Railroad Commission of Texas, the state’s energy regulator, said it wanted to cut back on testing requirements for oil wells, a data-saving effort that could save the industry $52 million a year.
“These cost-savings can then be passed on to create more jobs for Texans and generate more revenue for state coffers through increased energy production,” Christi Craddick, the head of the agency, said in a statement.
The proposal for so-called W-10 tests would allow operators to eliminate some additional filing requirements except for circumstances where a well is reclassified from oil to gas or production resumes from a well deemed inactive.
With a rebound underway across the U.S. energy sector, the Texas economy is already showing signs of strength. The Federal Reserve Bank of Dallas expects job growth to be around 3.4 percent for the year, beating the February rate of 3.2 percent.
“Energy and construction jobs have surged along with many of the large service sector industries, such as professional and business services,” Keith R. Phillips, a senior economist at the bank, said in a statement.
Texas is the No. 1 oil producer in the United States and home to the most lucrative shale basins in the country. The federal government estimates oil production from the Eagle Ford shale will increase marginally by April to 1.3 million barrels per day. Output from the Permian basin could increase 2.6 percent from the March rate of 3.07 million bpd.
Total U.S. crude oil production is around 10 million bpd. Total crude oil production from Texas last year topped 1 billion barrels.
The deregulation effort follows the approval of more than a quarter million dollars in penalties against 26 regulated entities for violating state regulations on everything from air quality to petroleum storage tanks.