The US energy companies Phillips Petroleum and Conoco have announced plans for a merger that would create a company with a market value of about $35bn (£24.5bn).

The new business will be called ConocoPhillips, and is set to be the third biggest oil and gas company in the US in terms of production after Exxon Mobil and ChevronTexaco.

In a joint statement, the companies said the merger, which still has to be approved by shareholders and US regulators, would bring better opportunities for growth and improved efficiency.

The Conoco-Phillips deal is the latest in a series of big energy company mergers following the fall in oil prices to very low levels in 1998.

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