BP Amoco listed "improved economics will drive Alaskan growth," a "quantum leap in Asian gas position" and "annual pre-tax synergies of $1 billion by 2001" among six major results of the merger with ARCO which has been agreed to by boards of both companies.
BP Amoco confirmed "a successful outcome to talks" in an April 1 statement and said the all-share transaction was worth $26.8 million.
"For BP Amoco, the strategic rationale for this deal is the immense potential it offers for future growth," said BP Amoco chief executive Sir John Browne.
"In Alaska in particular," Browne said, "the synergies we can achieve from combining our operations will greatly increase the competitiveness of the state in the face of uncertain oil prices and provide a strong incentive for significant investment in existing and future fields."
The deal could help unlock the potential for large volumes of gas in Alaska "which are currently uneconomic to develop but could make an enormous contribution to the energy needs of the U.S. in the next century," Browne said.
"We have proprietary BP Amoco technology which we believe may allow us to convert some