ChevronTexaco Corporation, the second-largest American oil company, agreed to buy Unocal Corporation for $16.4 billion in stock and cash to increase reserves in Asia, the world’s fastest-growing energy market.

The purchase, the oil industry’s biggest since 2002, values Unocal at $62 a share, ChevronTexaco said in a statement yesterday. El Segundo, Calif.-based Unocal rose to a record $64.60 last week, up 49% for the year, after reports that Eni SpA of Italy and China’s CNOOC Limited were among bidders for the company.

The Unocal purchase will add reserves in such Asian countries as Indonesia, where ChevronTexaco is the largest producer. Demand in the region is surging as the economies of China and India expand. Half of Unocal’s reserves are in Asia.

“Unocal has got some significant reserves in locations beneficial to ChevronTexaco,” said Douglas Ober, who manages $1.9 billion, including 625,000 ChevronTexaco shares, at Adams Express Company in Baltimore.

ChevronTexaco said the purchase will be made with 75% stock and 25% cash. Unocal stockholders will get 1.03 ChevronTexaco shares or $65 in cash for each share. Should more than one fourth of stockholders opt for cash, the distribution will be prorated, keeping the value at $62 a share.

Shares of ChevronTexaco, based in San Ramon, Calif., fell $2.03, or 3.4%, to $56.98 in New York Stock Exchange composite trading. Unocal dropped $2.33, or 3.93%, to $59.71. A close at that price would mark Unocal’s biggest decline since April 2000.

Oil and natural-gas prices over the next six to seven years may dictate whether the purchase pays off for ChevronTexaco, Mr. Ober said. The company’s cash holdings swelled to $10.7 billion at the end of last year as record energy prices inflated profit.

U.S. crude-oil futures today touched an all-time high of $58.28 a barrel and have jumped 66% in the past year.

Acquiring Unocal, which was founded in 1890 as Union Oil Company of California, will boost ChevronTexaco’s daily output by 16% to the equivalent of 3 million barrels of oil, halting a three-year production slide. The acquisition also will push ChevronTexaco past France’s Total SA as the world’s fourth-largest publicly traded oil and gas producer.

If completed, the transaction will be the biggest American oil purchase since Phillips Petroleum paid $25 billion for Conoco in August 2002.

ChevronTexaco also will assume $1.6 billion of Unocal debt.

ChevronTexaco has been expanding exploration and production in Asia and the Gulf of Mexico as output declines from old fields in other regions.

“Unocal’s assets fit into these strategies, in fact, they fit like a glove,” ChevronTexaco’s chief executive, David O’Reilly, told investors yesterday on a conference call.

Unocal has invested $5 billion in Indonesian oil and gas projects, including the offshore West Seno field. The company has agreements with the Indonesian government to produce oil and gas in the archipelago through 2028.

Mr. O’Reilly, 58, said ChevronTexaco will shed $2 billion in “non-strategic assets” after the Unocal purchase. He declined to identify the location of the assets to be sold. ChevronTexaco last year shed 400 of its oldest oil fields, raising $3 billion to finance exploration and refinery expansions.

Mr. O’Reilly estimated cost savings of $325 million in the first year after the acquisition closes. Two-thirds of the savings will come from trimming of overlapping operations and the rest from shedding poor-performing assets, he said. Mr. O’Reilly declined to say how many jobs may be cut.

Unocal shareholders won’t have to pay taxes on the stock portion of the sale, Mr. O’Reilly said. ChevronTexaco will increase stock buybacks to boost its shares and make the agreement more attractive, he said. The deal is expected to close this year.

Unocal’s chief executive, Charles R. Williamson, 56, said the ChevronTexaco bid represents “fair value” for his company.

ChevronTexaco is paying $9.37 per barrel of proved reserves from Unocal. That’s 33% more than the company’s cost of finding reserves last year, when ChevronTexaco had the highest such expense among the world’s 10 biggest publicly traded oil companies. Finding costs are the amount spent to add reserves through exploration.

ChevronTexaco’s oil and gas output has fallen 6.9% since the company was created with Chevron’s $45.8 billion takeover of Texaco in 2001. The decline came as old wells neared exhaustion and some oil and gas fields were sold to fund projects in Australia and the Gulf of Mexico.

ChevronTexaco’s reserves declined 6% in 2004 after some North American fields were sold and reservoir tests showed smaller-than-expected deposits in Africa, Asia, and the Gulf of Mexico. Reserves are a measure of future profit potential.

ChevronTexaco produced the equivalent of 2.509 million barrels of oil a day in 2004, down from 2.523 million barrels a day in 2003.

Unocal pumped the equivalent of 410,670 barrels of oil a day last year. About 62% of Unocal’s output is gas, compared with 28% at ChevronTexaco.

“The way for major integrated oil companies to grow at this point is through acquisitions,” said Tim Ghriskey, who helps manage $650 million at Solaris Asset Management in Bedford Hills, New York.