BP Plc appointed Meg O’Neill as its new chief executive officer, making her Big Oil’s first female leader, as the company struggles to revive its fortunes after a botched pivot toward renewable energy.
The management shakeup comes as BP lags its rivals due to a combination of corporate disasters, war, lackluster returns from its renewables efforts and some bad luck.
That has led to pressure from activist investor Elliott Investment Management, and a turnaround effort focused on oil and gas.
O’Neill, an American, stepped down as head of Australia-based Woodside Energy Group after four years in the job and had previously spent more than two decades at Exxon Mobil Corp.
Carol Howle will serve as BP’s interim CEO, filling in for outgoing CEO Murray Auchincloss, until O’Neill starts in April, the company said in a statement.
“She’s got a very hands-on track record in engineering and operations, which suggests a back-to-basics approach for BP,” said Neil Beveridge, managing director of research at Bernstein. “With Meg coming on board, the direction will clearly be oil and gas and LNG.”
Elliott built up a stake of just over 5% in BP and has engaged in a campaign to return the company to its core oil and gas focus — demanding changes including substantial cost cuts, asset sales and an exit from renewables.
While Auchincloss reset the company’s strategy in February — announcing portfolio divestments to reduce debt and improve the balance sheet — the London-listed firm has so far announced only minor asset sales.
The pivot marked the end of a switch away from fossil fuels by oil supermajors. BP then named Albert Manifold as chairman in July in response to the pressure from Elliott, following which Auchincloss said he was open to step down “were an appropriate leader identified who could accelerate delivery of BP’s strategy.”
Woodside under O’Neill focused on growing its core natural gas assets, brokering a takeover of a proposed US LNG plant in Louisiana and winning approval to keep Australia’s oldest and biggest gas export facility operating through 2070.
Since becoming CEO of Woodside in 2021, O’Neill also helped complete the multibillion-dollar acquisition of BHP Group Ltd.’s petroleum unit and expand its liquefied natural gas business outside of Australia.
She has been a big proponent of using gas as a transition fuel to reduce global coal demand and cut emissions.
“Although the announcement was surprising in terms of timing and immediacy, we expect that the change will ultimately be positive” for BP’s stock price, Piper Sandler analysts including Ryan Todd said in a note.
“There has been pressure for a more aggressive, ‘everything is on the table’ approach, and a fresh look at everything from strategy to portfolio to culture, that would benefit from an outsider.”
Woodside shares fell as much as 2.8% in Sydney on Thursday, to the lowest level since October.
Liz Westcott will take over as acting CEO of Woodside, the Australian producer said in a separate statement.
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