Steve Letbetter, chairman and CEO of Reliant Resources Inc. (RRI), became the latest top-level casualty of the collapse in the energy marketing industry after announcing his resignation last week. Board member Joel V. Staff, former CEO of National Oilwell Inc., has assumed Letbetter’s responsibilities until a new CEO is elected.

Letbetter had been appointed chairman and CEO of Reliant Energy Inc. and then moved to the top spot at RRI when it spun off from the parent in late 2002. He also had been president and CEO of Reliant Energy since 1999. Letbetter joined Houston Lighting & Power Co. in 1974 and had held various financial and management positions with increasing responsibility since.

“Building Reliant Resources has been an outstanding opportunity and a great experience,” Letbetter said in a statement. “Now, with the company’s successful refinancing completed, and after three years at Reliant Resources and many years before that at predecessor companies, I’m ready to pursue new opportunities. With Reliant well positioned for future success, the time is right for a change.”

Spencer Stuart, a national search firm, has been hired to begin a search for a permanent CEO.

“During this challenging time in the energy industry, Reliant employees have excelled at what they do best — providing outstanding service to Reliant’s customers,” said Staff in a statement. Our recently completed refinancing significantly improved the company’s financial position, and our core businesses are performing well in a difficult environment with substantial upside as markets improve.”

In a statement, the company’s board of directors said, “Reliant Resources is grateful to Steve for all his contributions in guiding the company during a challenging time in a very dynamic environment. During the past year, Reliant sharpened its strategic focus, restructured its business and solidified its financial position to allow the company to maximize opportunities in today’s markets. His hard work and tireless devotion to the business have laid the groundwork for the next stage of the company’s evolution.”

Letbetter’s resignation is but one of a long list of former CEOs to resign under pressure after the merchant energy business fell apart with Enron Corp.’s collapse. Besides Letbetter, other CEOs to leave in the past year include Dynegy Inc.’s Chuck Watson, CMS Energy’s William McCormick, El Paso Corp.’s William A. Wise, Aquila Inc.’s Robert Green, AES Corp.’s Dennis Bakke and NRG Chairman David H. Peterson. Several CFOs also were pushed out in the past year, notably Rob Doty of Dynegy and NRG’s Leonard A. Bluhm, as well as thousands of energy traders.

RRI was actually one of the first to lose top marketing employees last year as the merchant industry crumbled, when its top two trading executives, Joe Bob Perkins and Shahid J. Malik, resigned (see NGI, May 20, 2002). A month later, Letbetter managed to stave off an attempt by shareholders to force him to resign during the company’s annual meeting (see NGI, June 10, 2002).

RRI’s interim CEO Staff served as chairman, president and CEO of National Oilwell from July 1993 to May 2001 and remains a member of its board. He was associated with Baker Hughes Inc. between 1976 and June of 1993 and served in various financial and general management positions including senior vice president and president of the drilling and production groups. In addition to serving on the board of RRI, Staff is a director of Ensco International Inc.

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