By Christopher Alessi

MUNICH -- When American Lisa Davis took over energy operations at Siemens AG in 2014, oil prices were near record highs and Europe's largest industrial company was bullish on the U.S. natural-gas market.

Weeks after Ms. Davis assumed her post in Houston, the German manufacturing giant paid a rich premium to buy U.S. oil-equipment maker Dresser-Rand Group -- muscling onto rival General Electric Co.'s home turf.

But before the deal closed, oil prices tanked, with the global benchmark Brent dropping from highs around $115 a barrelin mid-2014 to below $30 at the start of this year, and recently trading just under $50.

Now, GE's recently announced plan to link with oil-field services provider Baker Hughes Inc. could stymie Siemens's energy ambitions. That transaction, announced last month, would create an energy powerhouse in the U.S. with more than $32 billion in revenue. Siemens posted oil-and-gas revenue for fiscal year 2016 of roughly EUR4.36 billion ($4.6 billion), according to estimates by J.P. Morgan Chase & Co. Shares of Siemens have risen 13% over the past year.

Ms. Davis pledges to push on.

"Oil and gas is here to stay," she said in a recent interview. "We are very committed to that marketplace and see it as a long-term bet."

A former Royal Dutch Shell PLC executive, Ms. Davis, 53 years old, must steer the beleaguered oil-and-gas unit through the downturn while integrating Dresser-Rand. Investors have questioned the price and timing of the$7.6 billion deal, which closed in mid-2015.

Ms. Davis says she aims to make the energy unit more efficient to gain a competitive edge when oil prices rebound. For that, she is calling on Siemens's experience digitizing and automating factories.

The Dresser-Rand deal, which came soon after Siemens paid about $1.3 billon for Rolls-Royce Holdings PLC's energy operations, broadened the company's energy portfolio. That means the company can now offer a range of services and products, such as compressors, to a wide variety of customers, she said. "And so we're there for the opportunities when they start to come back online."

Ms. Davis also oversees Siemens's growing power-generation and wind-power divisions, which are vital to energy business profits.

Siemens last year signed a EUR8 billion power-generation agreement with Egypt, the largest single order in its history. Earlier this year, the company announced plans to merge its wind operations with Spain's Gamesa Corporación Tecnológica SA, in a binding deal that would create one of the world's largest wind-turbine manufacturers.

Many investors initially were skeptical of Ms. Davis' ability to manage these other energy units because her work experience solely was in the oil-and-gas industry. Moreover, Ms. Davis is the first management board member in Siemens's 169-year history to run a major division from the U.S.

"There was tremendous doubt about her profile," said Ingo Speich, a portfolio manager at Union Investment, a Siemens shareholder. Operations have run "smoothly" under Ms. Davis, he said. "Overall, we are more positive" about her leadership capabilities.

Andreas Willi, an analyst at J.P. Morgan, said stationing a senior executive in the U.S. made sense because Siemens had been "too Munich-focused" before Chief Executive Joe Kaeser took over in 2013. Mr. Kaeser, who has presided over a major restructuring during the past few years, centralized control before recruiting Ms. Davis in 2014.

Mr. Willi said that while Siemens "historically wasn't an easy place for a woman, an outsider to succeed," if Mr. Kaeser "gives her full support, it sends a pretty clear message" to other staff.

In an interview earlier this year, Mr. Kaeser said the oil-and-gas unit "will be back stronger than ever...and the way we help them survive is to help them to build a digital oil field," referencing Siemens's plans to apply its digital expertise to the sector.

Ms. Davis said she brings a fresh perspective to a management board that can be too "process oriented" at the expense of results. "We tend to use our incredible intelligence and capabilities in the company to make things too complex at times," she said.

Now, the election of Donald Trump as U.S. president could offer the oil-and-gas industry "a lot of tailwinds," said Union Investment's Mr. Speich. He cited Mr. Trump's proposals to lower corporate taxes and invest in infrastructure as potentially mitigating increased energy-market competition.

Ms. Davis said Mr. Trump's pledges to improve ties between the West and Moscow could help Siemens re-engage in Russia, where it has done many deals in recent years. Siemens retrenched to comply with international sanctions following Russian incursions in Ukraine in 2014.

"Russia is like other countries where infrastructure improvements are needed," Ms. Davis said. "So if we can do that [build infrastructure] to support the needs in Russia in a fashion that is very respectful and compliant with the agreements between governments, then great."

Write to Christopher Alessi at christopher.alessi@wsj.com

(END) Dow Jones Newswires

November 26, 2016 02:47 ET (07:47 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.