Company town worried about corporate departure

<br>BARTLESVILLE, Okla. (AP) _ Announcements involving Phillips Petroleum Co. always unnerve tire store owner Chuck Tate, who realizes how the economic fortunes of this town are tied to the huge oil company

Sunday, November 18th 2001, 12:00 am

By: News On 6

BARTLESVILLE, Okla. (AP) _ Announcements involving Phillips Petroleum Co. always unnerve tire store owner Chuck Tate, who realizes how the economic fortunes of this town are tied to the huge oil company based here.

Tate was shocked when he heard that Phillips would merge with Conoco Inc. and move its corporate offices to Houston after 84 years in Bartlesville.

``This could be a bad deal for Bartlesville,'' Tate said as he looked out a big window toward Phillips' high-rise complex, which dominates the skyline. ``I hope not, but I'm expecting the worst.''

Word of the merger stunned this prairie town of 35,000.

Phillips Chairman Jim Mulva, to be chief executive of the new ConocoPhillips, did not say how many jobs would be cut. He said the company would maintain a significant local presence. It employs 2,400 in Bartlesville.

Also affected is Ponca City, 70 miles due west, where Conoco's refinery and offices employ 1,900 of the town's 26,000 people.

``One of the great fears we've had in Ponca City was that Conoco might be the victim of a hostile takeover,'' said Ponca City Mayor Tom Leonard. ``Now that they have created the third largest oil and gas company in the United States, that pretty much eliminates that risk.''

Conoco Chairman Archie Dunham, an Oklahoma native, will be chairman of the combined corporation.

``Both companies are committed to Oklahoma,'' he said.

Rumors preceded other deals, including a $7 billion acquisition earlier this year of Tosco Inc., as Phillips sought to grow amid a flurry of consolidations in the oil industry.

But there was no scuttlebutt around Bartlesville on the Conoco merger, employees said.

``They've done an excellent job figuring out how to do things in private,'' said Gary Clendenning, a 17-year employee in Phillips' transportation department.

Bartlesville's fortune has long mirrored the ups and downs of the company founded in 1917 by brothers Frank and L.E. Phillips.

There was downsizing after the 1980s oil bust.

Bartlesville embarked on a sustained effort to diversify its economy, luring new businesses and factories but nothing to compare to Phillips.

During the oil boom 20 years ago, Phillips employed 9,000 locally, half the city's workforce.

Phillips has donated millions of dollars to local charities. It will keep its commitments, Mulva said. The company recently gave a $3.6 million building designed by architect Frank Lloyd Wright to a local museum.

``Phillips has obviously been a huge part of this town, in my lifetime anyway,'' said local travel agency executive Gary Spears. ``It's scary.''

Spears said all of his business is directly related to arrangements with Phillips or tied indirectly to travel by Phillips' employees or townspeople who benefit from the company.

``When they say the Phillips' headquarters is not going to be here, it's a huge announcement,'' Spears said. ``I don't know what that means at this point. Nobody does.''

Many Phillips employees are Bartlesville natives, including Janette Spann, a mother and grandmother who's worked for the company for almost 30 years.

Monday morning, workers were abuzz with worry about the future of their jobs, she said.

Employees also worried about spouses who worked in other Bartlesville businesses that could feel the impact.

``I really haven't had time to sort through all of it yet,'' Spann said. ``I'm just shocked.''

Scott Wilson, branch manager at a local bank, said he expects the move will touch everyone in Bartlesville directly or indirectly.

``The whole town has been waiting for the other shoe to fall,'' Wilson said, ``and this is it.''

Kay Martin, executive vice president Bartlesville Association of Realtors, said it's too soon to know how the real estate market will be affected.

``We have since 1984 dealt with downsizing and workforce adjustments and because of that I think my attitude is just going to be wait and see,'' she said.

The only certainty, said Pam Dunlap, president of the Bartlesville Area Chamber of Commerce, is the town that Phillips helped build would have a new identity now.

``We're no longer going to be the headquarters of Phillips,'' she said. ``It's going to be up to us to decide what our new identity is going to be.''