Palin successor vows continuity in Alaska energy

By Yereth Rosen

ANCHORAGE, Alaska (Reuters) - The man who will take over as Alaska's governor later this month has extensive experience in oil and gas, but is telling the industry and corporate investors that policies will not change even as the face at the top does.

Lt. Gov. Sean Parnell, a 46-year-old Republican, will be sworn in as governor when Sarah Palin steps down on July 26 after her surprising resignation announcement last Friday.

"Bottom line, this was the Palin-Parnell administration. I intend to continue the core values and the overarching philosophy that guided it," Parnell told Reuters in a telephone interview on Wednesday.

That means pipeline projects will remain on course and oil taxes will not be altered despite industry complaints that the current regime is punitive.

Parnell said that when Palin told him of her plans to step down he was "surprised at the time." But he refuses to shed light on the motives of the 2008 Republican vice-presidential candidate who thrust Alaska into the national spotlight.

While speculation swirls that Palin is angling for national office again, Parnell emphasizes that his "focus is on Alaska."

Since Friday, Parnell has been calling legislators and "will be reaching out to the oil and gas industry," as well as the mining industry and other industries to assure them that Alaska has a stable investment climate.

On efforts to secure a massive North Slope natural gas pipeline, a mega-project sought by Alaskans for decades, Parnell said he will "follow through" with the Alaska Gasoline Inducement Act (AGIA), the Palin-sponsored law that established a competitive bidding process

The law resulted in a state license being granted to TransCanada Corp., which last month announced a partnership with Exxon Mobil, one of the three major North Slope oil producers and holders of leases to known natural gas.

The other two major oil producers and natural gas leaseholders, BP and ConocoPhillips, are pursuing a separate project, called Denali, under a partnership formed outside of AGIA.

Parnell said it will ultimately be up to the private sector to determine which pipeline plan succeeds.

"The state of the gasline project is such that you have now two credible projects with credible partners," he said.

TAX FREEZE TALK PREMATURE

There are no plans to grant what oil producers have termed "fiscal certainty" on natural gas production taxes, meaning a long-term lock-in of rates. The three major oil producers have declared such "certainty" is needed to reduce financial risks of building a massive natural gas pipeline.

Parnell said any discussion of a particular tax freeze is premature.