By Benoît Morenne

Oil boss Scott Sheffield has a new job: activist gunslinger.

Investment firm Kimmeridge is preparing to nominate Sheffield, the former chief executive of Pioneer Natural Resources, to join Coterra Energy's board as part of an activist push to revamp the company, according to people familiar with the matter.

It is an unexpected twist in a brewing battle over the future of Coterra, a roughly $20 billion, public oil-and-gas producer based in Houston. Sheffield, 73 years old, just last summer emerged from a yearlong, bruising battle that stymied his retirement plans -- and led him to announce he no longer wanted a board seat at oil giant Exxon Mobil.

Kimmeridge has been pushing for new leadership at Coterra and said it should sell its natural-gas operations to focus on its crude business in the Permian Basin of West Texas and New Mexico. The firm owns a little over 1% of Coterra, the people said.

Now, Kimmeridge is enlisting Sheffield, an industry heavyweight, to champion its claims. He is a respected, successful oilman who for years was U.S. shale's de facto leader. In 2024, he sold Pioneer to Exxon in a $60 billion blockbuster deal.

His nomination is likely to put pressure on Coterra Chairman and CEO Tom Jorden. Kimmeridge has said Coterra's board must reassess its leadership structure and appoint an independent, nonexecutive chair. The firm expects to nominate five people to Coterra's board, including Sheffield. It plans to recommend that he be appointed chairman, the people said.

The fight between Kimmeridge and Coterra is heating up as the producer is attracting suitors. Several oil-and-gas companies, including Devon Energy, have recently expressed interest in a potential transaction with Coterra, the people said.

Sheffield's willingness to battle it out with a former competitor makes for a surprising new act in his long career.

The former CEO once planned to spend his retirement in sunny Santa Fe, N.M., focused on charity work -- and with a cushy seat on the board of Exxon. But his plans soon fell apart.

Exxon struck an agreement with Democratic antitrust enforcers at the Federal Trade Commission that barred Sheffield from its board, in exchange for getting the merger approved. The FTC in a complaint accused the oilman of attempting to collude with officials from the Organization of the Petroleum Exporting Countries to raise oil prices. Sheffield sued the agency.

The allegations threatened to tarnish Sheffield's reputation and isolated him within the industry.

"I don't talk to other shale execs anymore," he said dryly in an interview with The Wall Street Journal last year.

Sheffield got his revenge last summer, when the FTC's new Republican majority nixed the ban preventing him from serving on Exxon's board in a legacy-saving move. But Sheffield said he was no longer interested in serving as a director. He accused Exxon of signing a "rushed, baseless and illegal order" and of effectively breaking the commitment it made to him in the merger agreement with Pioneer.

About three weeks ago, Kimmeridge reached out to Sheffield to ask if he would consider being one of their nominees, said one of the people familiar with the matter. The firm didn't necessarily expect Sheffield to agree, because the fight would require a significant amount of time and energy. Kimmeridge was pleasantly surprised when he responded positively.

The person noted that Sheffield once left retirement to reprise the CEO role at Pioneer and that the Coterra situation presents a similar opportunity to improve shareholder value.

In a scathing November letter to Coterra's board, Kimmeridge said it was getting involved to address failures of governance and lack of strategic focus following the 2021 merger that birthed the company. That year, Cabot Oil & Gas, a natural-gas producer in the Northeast, and Cimarex Energy, an operator in Texas, Oklahoma and New Mexico primarily focused on oil, combined in a $14 billion deal. Jorden was CEO of Cimarex.

Kimmeridge says the merger was a failure.

"Coterra now trades at a significant discount to both Permian and gas-focused peers, underscoring the market's rejection of a merger that prioritized self-preservation over strategic merit," Mark Viviano, managing partner at Kimmeridge, said in the letter.

Jorden said in an earnings call that the letter contained "some factual errors" and that the company was disappointed that Kimmeridge released it without reaching out to Coterra. He said Coterra was nonetheless open to suggestions.

U.S. shale companies have at times faced a dilemma between spreading across several basins or concentrating their efforts in just one region, especially as they have begun to run out of sweet spots. As CEO of Pioneer, a major Permian player, Sheffield said he thought the company would benefit in the long term from implanting itself in different basins beyond that region.

In 2021, he gathered his team to discuss a potential takeover of Cabot Oil & Gas, The Wall Street Journal previously reported. The team pushed back against the idea of a deal, and Sheffield abandoned it.

Write to Benoît Morenne at benoit.morenne@wsj.com

(END) Dow Jones Newswires

January 22, 2026 10:00 ET (15:00 GMT)

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