General Electric (GE) is expected to announce today (Ocotber 31) a $30 billion deal to combine its oil-and-gas business with Baker Hughes, a Wall Street Journal report said.

The deal will create an energy powerhouse that would give GE a cost-effective way to play any recovery in the industry, it said.

GE plans to contribute its oil-and-gas business and some cash to the new entity, which would have publicly traded shares and be majority-owned and controlled by GE, the report said.

A combination of Baker Hughes and GE's oil and gas business could create a company with more than $25 billion in revenue that would better compete with rivals such as Schlumberger to provide equipment and services to oil rigs and wells.

Baker Hughes has confirmed it is in discussions with GE.