TOKYO, Dec. 4 -- Japan's Nippon Oil Corp. and Nippon Mining Holdings Inc. announced plans Thursday to merge next year, creating the world's eighth largest oil company.

When the merger of the two Tokyo companies is completed next October, the integrated company will have estimated annual revenues of more than $140.2 billion, the announcement said.

Details of the merger including the name of the new company and the terms will be decided through negotiations, Kyodo news service reported.

Together, the two companies own about 13,000 gas stations.

Nippon Oil earned about $1.6 billion last fiscal year on revenues of $81.1 billion. In the same year, Nippon Mining earned slightly more than $1 billion on revenues of $46.8 billion.

The announcement comes at a time when the global economic slowdown has hit oil firms with sharp declines in crude oil prices and dwindling demand for petroleum, Kyodo said.

The report said the two companies will set up a holding company that will supervise newly formed operating business sectors involved in petroleum, oil, natural gas and metals.

Nippon Oil President Shinji Nishio said the merger is expected to result in annual cost saving of $647 million after three years.(UPI)