Lisa Stewart, who has served as president of El Paso Corp.’s exploration and production (E&P) unit for two and a half years, announced her resignation on Wednesday. Stewart, who will join private equity firm Warburg Pincus later this year, was instrumental in helping turn around the once-ailing E&P unit.

In a letter to El Paso colleagues, Stewart said resigning from the company “was not an easy decision for me to reach, but it’s an opportunity that I feel I cannot let go by. It’s a chance for me to do something I’ve wanted to do all my professional life.” Stewart will remain at El Paso until Sept. 1. The former Apache Corp. E&P executive was personally recruited by El Paso CEO Doug Foshee in early 2004 (see Daily GPI, Jan. 13, 2004).

“My enthusiasm for my next venture in no way lessens my feelings of regret for leaving El Paso,” Stewart said in her letter. “I am proud of the successes and the momentum we have worked together to achieve the last two and a half years. By any measure you choose to apply, El Paso E&P today is well positioned for a great future; the capital program is creating value for our shareholders, the organization’s processes are improved and improving, the leadership team is synchronized and focused, the production marketing team is performing an integral role and the portfolio, international and domestic, is well balanced and poised to seize future opportunities.”

Stewart added, “We can all be proud of the determination and dedication that has brought us to this point, and we can be confident in the certainty of El Paso’s future success. Thank you for your hard work; our accomplishments were truly a team effort. I will carry the memories of our journey together for the rest of my career.”

Foshee told employees in a memo that “both personally and professionally I hate to see Lisa leave. When I recruited Lisa in early 2004 our nonregulated businesses faced tremendous challenges. In fact, I would characterize those challenges collectively as unprecedented. What Lisa brought to the task of righting the ship was an incredible work ethic, a history of success, a broad and deep understanding of every aspect of E&P and a real sense of mission about the job ahead. Those attributes proved contagious, and we have all witnessed the transformation of those businesses under her leadership and with the talented team around her and all the employees of Team El Paso.”

Foshee said he and the board of directors were “grateful” to Stewart for “all of her efforts,” and added that they wished her “great success.” Foshee also took the time to remind employees that El Paso’s E&P business was now “in very good shape,” and said “Lisa is surrounded by a great team and one that I have great confidence will continue leading this business back to being a top performer.”

A search for Stewart’s successor is now under way, and it will include both internal and external candidates.

“In the interim until Lisa’s successor is named, I will focus my time and attention on this business so that the valuable momentum that we all have worked so hard for is not lost,” Foshee said. “I hate to lose Lisa. She has been a great friend, colleague and executive for El Paso. But the future of Team El Paso is brighter than at any time in my tenure here. So please join me in thanking Lisa for her contributions to El Paso, wishing her well as she heads off to her next challenge, and then getting back to work! We’ve had a great first half, but there is a lot left to do and we need every member of Team El Paso to help make this the breakout year we all know it can be.”

Standard & Poor’s Ratings Services said that its ratings and outlook on El Paso would remain unchanged following the announcement. “Ms. Stewart presided over the stabilization of the E&P business following poor operating performance and a series of large reserve write-downs. While Standard & Poor’s views her departure as a setback for El Paso’s efforts to strengthen the E&P unit and as raising questions regarding further improvement, the company continues to make progress restoring its financial position and refocusing the business on core operations.”

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