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Vol. 13, No. 36 Week of September 07, 2008
Providing coverage of Alaska and northern Canada's oil and gas industry

Experience, constitution would guide Parnell in leadership role

Gov. Sarah Palin will continue to handle state affairs during her campaign for vice president, state officials said Aug. 29, the day Republican presidential nominee John McCain named Palin as his running mate.

“Right now everything is functioning as it should,” Palin press secretary Bill McAllister said at a news conference. “She’s in close phone and e-mail contact with anyone she needs to be, and if there’s business to take care of, she will take care of it.”

But McCain’s choice — and Palin’s acceptance — have left many wondering how things would change in Juneau should McCain win in November.

According to Attorney General Talis Colberg, if Palin became vice president, Lt. Gov. Sean Parnell would take over for the remainder of the four-year term.

If Parnell also won his race for U.S. House, Colberg himself would become governor, as Palin’s designated successor to the lieutenant governor. Parnell is narrowly behind Rep. Don Young in last month’s Republican primary, with ballots still being counted and verified. (A final determination is expected Sept. 18.)

Colberg would be required to hold a special election within 90 days to choose a new governor.

Parnell’s approach as governor would largely echo Palin’s

In an interview Sept. 3, Parnell said he hoped to win his race for Congress. But he added that if he took over as governor, his priorities and approach to oil and gas issues would largely echo the governor’s.

“We both have the view that our constitution is our foundation and the people are who we serve,” he said. “There may be differences in execution because we’re two different people.”

Parnell said he has long appreciated the role of the industry in Alaska and understands the importance of creating a stable investment climate and consistent regulatory regime.

He added that he saw the gas pipeline project as largely out of the state’s hands now, and said he expected TransCanada, the major gas producers, the Alaska Gasline Port Authority and the Alaska Natural Gas Development Authority to work out a deal together.

“I think the state’s in a good position right now,” he said. “My philosophy and the governor’s match in that we think a private sector project is the way to go.”

Parnell has worked as a commercial attorney for 14 of the last 21 years, he said, but has also served in the Alaska Legislature, worked in the oil industry, and participated in gas line negotiations as a deputy director of the state’s Division of Oil and Gas. (Only a small fraction of his legal work dealt with oil and gas issues, he said.)

Parnell served in Legislature

Parnell served in the Alaska House from 1993 to 1997 and in the Senate from 1997 to 2001. He held seats on the House and Senate Finance Committees during the entire eight years, and served two years as Senate Finance Committee co-chair.

He said he supported and helped pass into law the Stranded Gas Development Act and state programs for area-wide leasing and exploration incentive credits.

From 2000 to 2003, Parnell worked for Phillips Petroleum Co. and ConocoPhillips, helping permit and drill an exploration well on the Kenai Peninsula.

In 2003, Parnell moved to the Division of Oil and Gas, where he oversaw personnel and budgeting issues. Parnell was also part of the team negotiating a gas pipeline deal with TransCanada under then-Gov. Frank Murkowski.

“I was in those negotiations daily, working on behalf of the state,” he said. “It certainly informed how I approach gas line policy, and it informed my view of how commercial parties in the private sector approach commercial negotiations.”

Representatives from the three major producers — BP, ConocoPhillips, and ExxonMobil — declined to comment on the prospect of a Parnell administration.

“As a matter of practice, ExxonMobil does not comment on political events,” Exxon spokeswoman Margaret Ross wrote in an e-mail.

Expected to continue course

But others who know Parnell personally said they thought he would generally continue on Palin’s course.

“I think he would carry on many of the same policies,” said Deputy Commissioner of Natural Resources Marty Rutherford, who also worked on negotiations with TransCanada under Murkowski. “I think the governor and he are very like-minded.”

Rutherford said the state’s approach to getting a gas pipeline was largely set with the decision to issue a state license to TransCanada under the Alaska Gasline Inducement Act. But she added that there was still a role for the state in moving the project forward.

(State lawmakers passed legislation approving the TransCanada plan on Aug. 1, and Palin signed the legislation on Aug. 27.)

Mark Hanley, who works for Anadarko Petroleum Corp. but based his comments on his experience serving with Parnell in the Alaska Legislature, said he saw Parnell as “pro-development” and “pro-oil and gas industry,” but also someone who would ensure that the state got its fair share.

“I don’t know if Sean would have said 24 percent instead of 25,” he said, referring to recent changes to the state’s oil production tax.

Sen. Gene Therriault, a North Pole Republican who also served with Parnell in the Alaska Legislature, said he thought Parnell had the same motivation as Palin even if he had a different leadership style.

“I have not heard anything out of the lieutenant governor that he disagrees with where the governor has taken the state,” Therriault said.

Bill Van Dyke, who worked with Parnell at the Division of Oil and Gas and served briefly as acting division director under Murkowski, said Parnell had a good understanding of the industry and the issues.

But Van Dyke added that he didn’t have any idea whether Parnell would take a different approach than Palin to securing a natural gas pipeline.

“If he has a different philosophy, he’s probably kept it to himself,” he said.

—Stefan Milkowski

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