UPDATE 2-Duke CEO says in settlement talks with NC officials
* CEO Rogers declines to comment on nature of potential pact
* Rogers says NC regulator will evaluate rate cases fairly
* Duke earnings rise slightly, Progress profits slip
* Duke shares slip 1 percent
Aug 2 (Reuters) - Duke Energy is in negotiations with North Carolina regulators and the state attorney general over its controversial ousting of its former chief executive in the hours after it closed its takeover of Progress Energy, its CEO said on Thursday.
Jim Rogers, who was returned to the top job at Duke after the board sought the resignation of his replacement, would not comment on the nature of the talks with the North Carolina Utilities Commission, which held hearings on the surprise CEO switch last month.
"I can't speculate on the outcome of the commission's investigations, or on the settlement discussions we're engaged in now," Rogers told Reuters in an interview.
He did say that representatives of Bill Johnson, the Progress Energy CEO who was long slated to take the helm of the merged company, were not involved in the negotiations.
"We continue to work closely and maintain an open dialogue with the commission, and we'll just work our way through it," he said.
The Public Staff of the NCUC declined to comment on the negotiations, and a lawyer at the NCUC was not available.
Duke's $18 billion purchase of Progress Energy created the nation's largest power utility, but its rapid move to remove Johnson sparked outrage in North Carolina, the company's biggest market.
The chairman of the North Carolina Utilities Commission has said the regulator could revisit its approval of the merger and potentially install Johnson in the CEO job, although such a move was seen as unlikely.
Analysts have speculated the company could launch a search process for a new CEO to replace Rogers, a move that could be appease the regulators.
Still, the company is likely to face a chill in its relations with the NCUC, which sets profit margins of the power utilities in the state.
In a conference call, Rogers said the NCUC had always fairly evaluated its proposals around electricity rates in the past, and he expected no change in the future.
The company expects to file two separate proposals to change rates in North Carolina by the end of the year.
Duke said on Wednesday it had filed a request with the NCUC to cut rates by $89 million over the coming year as part of its planned $650 million in savings over five years from the merger.
Duke announced on Thursday that its second-quarter profit rose on revised customer rates in the Carolinas and lower storm restoration costs in a unit.
Net income rose to $444 million, or 99 cents per share, in the second quarter, from $435 million, or 98 cents, a year earlier.
Excluding one-time items, earnings per share were $1.02, and its operating revenue rose 1.2 percent to $3.57 billion.
Progress Energy, which reported separately, posted earnings of 21 cents per share, or $63 million, down from $176 million, or 60 cents per share a year ago, hurt by an extended refueling outage at a nuclear plant.
Excluding one-time items, earnings per share at Progress were 27 cents per share.
Shares of Duke were down 1 percent to $66.86 on the New York Stock Exchange in noon trading.