* Woodside backs Browse after ditching Israeli gas project
* CEO says under no pressure to make a quick acquisition
* Exploration to play a key role in growth
(Adds Woodside ceo, analyst quotes, details)
SYDNEY/MELBOURNE, May 22 Australia's Woodside
Petroleum Ltd said it was under no pressure to rush
into a new acquisition, a day after scrapping a proposed
multi-billion-dollar investment in a gas project in Israel.
Woodside Chief Executive Peter Coleman said Australia's
largest independent oil and gas company was counting on its
delayed Browse liquefied natural gas project, frontier
exploration and acquisitions for future growth.
The company would hunt for projects in the $1 billion-to-$5
billion range and maintain a disciplined investment stance, with
the Browse gas project in Western Australia set to be the
"foundation" of its next phase of growth.
Woodside pulled out of a plan to take a 25 percent stake in
the Leviathan gas project in Israel at a cost up to $2.7
billion, citing "a failure to reach a commercially acceptable
Leviathan has reserves of 19 trillion cubic feet (tcf) of
gas, compared with 14.9 tcf in Browse, although Woodside has a
slightly bigger stake in the Australian field which would be
solely developed for liquefied natural gas (LNG).
Analysts have welcomed the decision on Leviathan, backing
the company's discipline and the move away from an area with
high geopolitical risk.
"Their money would be better spent in their own backyard
where they have already invested in plenty of infrastructure,"
said Morningstar analyst Mark Taylor.
Woodside shares added 1.2 percent on Thursday, hovering near
a three-year high.
Coleman said he would discuss ways to deploy the cash
earmarked for Leviathan with Woodside's board, including a
possible return to shareholders, but played down the prospect of
big acquisitions, saying they rarely add value.
"If I want to take the sugar pill, we can go buy volume
growth and I'll dress it up for you and I'll tell you how good
it is. But if you really want to focus on value, then it's a
hard road," he told an investor briefing in Sydney.
Woodside, which competes with companies like Anadarko
Petroleum, BG, ConocoPhillips and
Norway's Statoil, had been actively looking at other options for
spending the funds, but would not rush into any acquisition just
to boost production volumes.
"I don't feel in any way obliged to act swiftly on those
just to simply grow," Coleman said.
An investment decision on Browse is expected in 2015, after
Woodside and its partners dropped plans last year to build a $45
billion LNG plant on land and opted to study a floating LNG
plant, using partner Royal Dutch Shell's Prelude FLNG
plant as a model.
Coleman said growth, whether through discoveries or
acquisitions, would most likely come from emerging oil and gas
provinces, such as East Africa, Myanmar and the promising
Porcupine Basin off Ireland, where it has acreage.
Woodside is making a big push into exploration, aiming to
spend around $650 million a year hunting in unexplored basins
and build up oil reserves to balance its strong gas reserves.
Coleman, who took over the top job at Woodside in 2011, said
exploration work had dropped off at the company to its
"Clearly we need to be a better explorer," he said.
(Reporting by James Regan and Sonali Paul; Editing by Richard