Phillips, Conoco agree to merge

TULSA, Okla. -- Phillips Petroleum Co. and Conoco Inc. have signed an agreement to merge in a deal tentatively worth $35 billion.

The new business will be called ConocoPhillips and is expected to be the nation's third-biggest oil and gas company in terms of production. It will be the fifth-biggest refiner in the world.

The merger still needs to be approved by the government and shareholders.

Under the terms of the deal, Phillips shareholders will get one share of ConocoPhillips stock for each Phillips share they own. Conoco shareholders will get 0.468 shares of the new stock.

The companies said in a statement that the merger would result in better growth opportunities, improved efficiency and development of energy exploration and production.

Conoco chairman and chief executive Archie W. Dunham will delay his retirement to 2004 and serve as chairman of ConocoPhillips. Phillip's chairman and CEO James J. Mulva will become the new company's president and CEO. He'll take the chairman's job after Dunham retires.

Bartlesville, Okla.-based Phillips is a familiar face to motorists in the United States with its Phillips 66 logo. The company has more than 5 billion barrels of oil in reserve.