Dec. 16 (Bloomberg) -- President-elect Barack Obama has chosen former Iowa Governor Thomas Vilsack as Agriculture secretary and Colorado Senator Ken Salazar as his Interior secretary, according to a Democratic official.

Obama will formally announce his intention to nominate both men at a news conference tomorrow in Chicago, according to the official, who spoke on the condition of anonymity.

Vilsack, 58, served as Iowa’s governor for eight years. He was the first Democrat elected to the office in 32 years. An attorney at the Dorsey Trial group, Vilsack endorsed New York Senator Hillary Clinton during the Democratic presidential primary campaign.

He would bring to the Department of Agriculture experience as the former chief executive of a state heavily reliant on agriculture and related industries. Iowa ranks third in the U.S. in the value of agricultural products sold and is one of the nation’s top producers of corn, soybeans, hogs and eggs, according to government statistics.

The Agriculture secretary oversees the fourth-largest Cabinet agency, with a budget of about $100 billion and 110,000 employees.

Salazar, 53, would head a department responsible for national parks and energy production on federal lands. He is in his first term in the Senate after serving as Colorado attorney general and executive director of its department of natural resources.

Oil Production

He has criticized the Bush administration’s efforts to develop oil from Western shale formations, saying that while shale may have potential to produce billions of barrels, the technology may not be commercially viable. He also says it’s not clear how much pollution would result from shale oil development or how much water would be needed to produce it. Salazar supports more oil and gas drilling off U.S. shores.

The Interior Department, which has been called the “department of everything else,” encompasses the National Park Service, Bureau of Land Management, Fish and Wildlife Service and Bureau of Indian Affairs, among other agencies. It has more than 70,000 employees and a budget of $16.8 billion.

Vilsack and Salazar will join Obama at the news conference, scheduled to begin at 10:45 a.m. Chicago time.

Senate Confirmation

Both posts are subject to confirmation by the Senate. Colorado Governor Bill Ritter, a Democrat, would name Salazar’s replacement in the Senate for the remainder of the term if Salazar is nominated and confirmed.

Obama has moved faster than any modern president-elect in selecting his Cabinet and other top members of his administration. He’s expected to shore up the remainder of his Cabinet appointments this week before he leaves for vacation in Hawaii.

Today Obama named Arne Duncan, chief executive of the Chicago public school system to be the next secretary of education. He has yet to name secretaries of Labor, Transportation and the Director of Central Intelligence. His choices for U.S. trade representative and director of national intelligence also haven’t been announced.

Obama owes much of his success in the presidential election to Iowa and without his win in the state’s Jan. 3 caucuses, he likely wouldn’t have won his party’s nomination, his advisers have said.

To contact the reporters on this story: Julianna Goldman in Washington at jgoldman6@bloomberg.net; Kim Chipman in Chicago at kchipman@bloomberg.net;

Last Updated: December 16, 2008 19:49 EST