Woodside Misses Deadline on Israeli Gas Deal as Talks Continue

Woodside Petroleum Ltd. (WPL), Australia’s second-largest oil producer, missed its target for completing a deal to buy a stake in a natural gas project in Israel, 15 months after signing an initial accord.

Talks are continuing with partners in the Leviathan gas venture, including Noble Energy Inc. (NBL), and the Israeli government “with a view to resolving the remaining issues,” Perth-based Woodside said today in a statement. The companies had planned to complete the agreement by yesterday to purchase the stake for as much as $2.6 billion.

A deal would give Woodside a slice of Israel’s largest gas field as the company’s proposed projects in Australia face delays. The partners, including Delek Drilling LP, Avner Oil Exploration LLP and Ratio Oil Exploration LP, intend to supply the domestic market in Israel as well as neighboring countries, while also exporting LNG, Woodside said last month.

Woodside last month agreed to pay Noble and its partners an initial $850 million when the deal is completed. The 25 percent stake it’s seeking to acquire is smaller than the 30 percent negotiated in the December 2012 deal worth as much as $2.3 billion, though the estimated size of the resource rose to 18.9 trillion cubic feet of gas from 17 trillion cubic feet.

To contact the reporter on this story: James Paton in Sydney at jpaton4@bloomberg.net

To contact the editors responsible for this story: Jason Rogers at jrogers73@bloomberg.net Keith Gosman, Andrew Hobbs

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