ARCO HEAD CONFIDENT OF MERGER : MERITS OF BP LINK STRONG, HE CONTENDS.Byline: Peter Kaplan Peter Kaplan is Editor-In-Chief of the New York Observer, a weekly newspaper. External links
The top executive at Los Angeles-based Atlantic Richfield Co. on Wednesday expressed confidence his company's pending merger with BP Amoco Plc will win approval despite some opposition from regulators. ``The merits of this transaction remain as strong today as ever,'' Arco Chairman Mike Bowlin said in a statement. ``The competitive landscape in the West Coast gasoline market is not changed by this merger since there is no overlap in our operations or marketing. So in my opinion, there is no basis for an objection to the combination.'' Sources on Tuesday said that staff attorneys at the Federal Trade Commission have recommended that the agency block BP Amoco's acquisition of Arco, which has a reputation as the low-price leader in the West. The federal attorneys reportedly are concerned about the merger's impact on the price of gasoline in California and other Western states. Despite the staff's recommendation, the two companies will have a chance to argue the case before the commissioners. But the opposition makes it likely the two companies will probably have to give up more concessions or risk a legal fight with the government. The FTC's antitrust review of the $29 billion BP Amoco-Arco deal has centered on fears that the combination would give them too much control over production at Alaska's North Slope North Slope, Alaska: see Alaska North Slope. oil fields This list of oil fields includes major fields of the past and present. The list is incomplete; there are more than 40,000 oil and gas fields of all sizes in the world[1]. . California and other Western states rely heavily on North Slope oil and, with less competition there, officials fear gasoline prices might rise. But Bowlin on Wednesday criticized that assumption, calling it ``not accurate since . . . prices are set in the world market.'' The opposition from federal regulators comes about a month after BP Amoco and Arco won support for the deal from Alaska Gov. Tony Knowles
Tony Knowles and Anthony Knowles may refer to:
Divest is usually used in reference to the relinquishment of authority, power, property, or title. If, for example, an individual is disinherited, he or she is divested of the right to inherit money. about 175,000 barrels of North Slope production and provide ``commensurate com·men·su·rate adj. 1. Of the same size, extent, or duration as another. 2. Corresponding in size or degree; proportionate: a salary commensurate with my performance. 3. access to the Trans-Alaska oil pipeline and other North Slope production facilities.'' In the agreement with Knowles, BP Amoco also promised to divest 400,000 acres of exploration land and make 1.2 billion cubic feet of natural gas reserves available to other companies. But only two weeks later, California's attorney general released a report that foreshadowed the problems with the FTC FTC See Federal Trade Commission (FTC). . It said ``concentration'' of the oil industry was partly to blame for the high gasoline prices there. Attorney General Bill Lockyer William Westwood "Bill" Lockyer (born May 8, 1941) is the current State Treasurer of California. Prior to this, he served as California's Attorney General and head of the Department of Justice for the U.S. state of California. commissioned the report in response to a spike in gasoline prices earlier this year. He said the report ``underscores the need for California to review carefully any merger or acquisition to protect against the erosion of competition in an already concentrated and vertically integrated gasoline market.'' In April, gasoline prices in California peaked at $1.32 a gallon, far higher than other states and 43 cents more expensive than the previous year. |
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