Exxon-Mobil Merger Likely

The Federal Trade Commission has signaled to the states its intention to recommend the approval of Exxon's $81 billion acquisition of Mobil, which would create one of the world's largest energy companies, government officials close to the deal said Saturday.

Some states indicated they were not satisfied with the divestiture proposal, including the sale of about 2,400 gas stations nationwide that was worked by the companies and the agency, although it is unlikely those states could block the merger.

"We're still concerned about the overall anti-competitive effects of so huge a merger with so sweeping an effect in consolidating ownership and control, and about the possible harm to consumers," Connecticut Attorney General Richard Blumenthal said in an interview Saturday.

He said Connecticut opposes the deal. The New York Times, which reported on the pending FTC vote, said New Hampshire also notified federal regulators that it was leaning against the deal. Other states, including Texas and California, have agreed with the terms offered by Mobil and Exxon.

Two government officials close to the talks, speaking on condition of anonymity, said the FTC's five commissioners were expected to vote on the deal early next week.

The news comes as federal and some state officials have raised antitrust questions about another large oil merger, BP Amoco's proposed $29 billion purchase of Atlantic Richfield Co.

The centerpiece of the agreement between Exxon and Mobil, respectively the nation's largest and second-largest oil producers, is the sale of about 2,400 gas stations, roughly 15 percent of the companies' retailers around the country. Exxon would also sell a refinery in Benicia, Calif., and the companies would sell substantial interests in several pipelines throughout the U.S.

In the BP Amoco-Arco deal, executives from the companies are expected to reach a final agreement allaying antitrust and other concerns raised by the state of Alaska, said Bob King, spokesman for Alaska Gov. Tony Knowles.

Alaska officials and lawyers involved in negotiating the deal said that the arrangement did not sufficiently protect consumers in California and other states that have experienced higher-than-average prices at the pump this year. California Attorney General Bill Lockyer has been working closely with the FTC on the deal.

Roddy Kennedy, BP Amoco's top spokesman in London, said the company expected "to continue discussions with the FTC and we are confident of a fruitful outcome."