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Shareholders back ConocoPhillips; merger awaits antitrust approval Conoco plans to start construction of a commercial-size GTL plant in 2004; its location and size haven’t been decided Allen Baker PNA Contributing Writer
Shareholders of both Phillips and Conoco have voted overwhelmingly to approve the merger of the two companies. Yes votes came from 97 percent of Phillips shares voted, and from 96 percent of Conoco’s owners.
The only remaining hurdle is antitrust review by U.S. authorities.
European and Canadian regulators have already signed off on the $15.6 billion deal, and the Federal Trade Commission is considered likely to follow suit. The companies hope to turn into ConocoPhillips in the second half of this year.
Current Phillips Petroleum Co. shareholders will hold a slightly larger stake in the new company than the current Conoco Inc. owners. Phillips shareholders will receive 56.6 percent of the shares in the new company, which will be third-largest in the U.S. and sixth-biggest investor-owned oil firm in the world.
Jim Mulva, chairman and chief executive of Phillips, will be president and CEO. Archie W. Dunham, chairman and CEO of Conoco, will take the chairman’s job until 2004, when he plans to retire.
Phillips will pull its roots in Bartlesville, Okla., where it’s been the dominant employer for more than 80 years. The new company will have its headquarters in Houston, already home to Conoco.
“We believe the combination of these two companies will create significant value for all stakeholders and provide excellent financial and operational growth opportunities,” Mulva said in a statement after the March 12 votes were announced.
Executives working on the merger say they expect $750 million in “synergies,” from the combination. That can often mean job cuts.
For Alaska, there’s no overlap between the two companies, and so employment here isn’t likely to be affected. Conoco, which once was a significant Alaska explorer, left the state years ago.
For Phillips, the purchase of ARCO’s Alaska interests was a big part of Mulva’s strategy to build the company into a major force in the industry.
“Alaska is a very important core area for Phillips, and it will continue to be a core area for ConocoPhillips,’’ said spokeswoman Kristi DeJarlais. Conoco has GTL plant Current Phillips geologists in Alaska may get some help from old exploration data in Conoco’s vaults. But a bigger asset for the North Slope may be Conoco’s gas-to-liquids technology.
Conoco is working on a $75 million GTL demonstration plant at its Ponca City, Okla., refinery that’s a bit larger (400 barrels a day versus 300) than the pilot plant BP is building at Nikiski. Earlier this month, Conoco said it had installed the first of 58 production modules at the plant, scheduled to begin operations by the end of the year.
Conoco plans to start construction of a commercial-size GTL plant in 2004, though its location and size haven’t been decided yet.
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