Upstream investor Kimmeridge Energy Management Co. LLC has the U.S. exploration sector in its sights and is calling out the industry for its “lack of alignment” between the executive management teams and their shareholders.

Change of control payments vs compensation

The New York City-based private equity (PE) firm said in a white paper that executive compensation for the exploration and production (E&P) sector was still rising, even though it is “one of the worst performing sectors” in the past decade.

“In our prior white papers, we outlined core operating components that would make the public E&P sector investable again,” said Kimmeridge founder Ben Dell. “While we have witnessed some progress in evolving the operating model and intensifying the conversation around environmental performance in boardrooms,...