Chevron's exit from two major Australian investments has raised concerns about the nation's reliance on oil and gas earnings as shares in the sector dive.
Late on Friday, the global oil and gas giant made a $4.6 billion exit from its 50 per cent stake in fuel distributor Caltex and walked away from the country's biggest unconventional oil and gas exploration venture.
Caltex welcomed the oversubscribed sale but its shares along with Beach Energy and Icon Energy, partners in the South Australian Cooper Basin shale project, fell heavily.
Friday's announcements were sudden but not a surprise as Chevron flagged plans earlier this month to sell up to $US15 billion in assets by 2017.
However it was a very negative sign for Australia's natural gas industry, said IG market strategist Evan Lucas.
This month the Commonwealth Department of Industry and Science predicted Australia would be the world's largest exporter of liquefied natural gas by 2020, driving a rebound in resources earnings from next year to 2020.
Chevron's departure from the Cooper Basin project and Caltex was symbolic, said Mr Lucas.
"Chevron has spent a lot of money and spent a lot of time in this country trying to develop the prospect of energy supply and energy pipelines in what they've got there," he said.
"While it's a good longer term idea for Caltex shareholders I understand that, what it symbolises could be the concern.
"Chevron said very clearly that coal seam gas and gas in general currently doesn't stack up from a financial stability point of view."
Beach said in a statement that the Cooper Basin project was a vast resource that could supply gas to Australia and export markets for decades to come.
However it has now lost Chevron and the $159 million it would have spent this year on exploration, also threatening hopes that 5,000 jobs would have been created.
Chevron said it was still committed to Western Australia's $US54 billion Gorgon project and the $30 billion Wheatstone LNG.
Caltex chief executive Julian Segal said on Monday while he believed the company had always operated independently, the exit of Chevron improved perceptions around that.
The success of the sell-down, which was over-subscribed and the largest block trade in Australian history, showed investors were pleased with Caltex's strategy and status as Australia's leader in transport fuels, he said.
That includes getting itself in a position where it was now at a stage to pursue growth through acquisitions, which it had already started doing, he said.
Energy stocks on the ASX fell nearly five per cent.
Caltex shares fell $3.52, or 9.3 per cent, to $34.36, Beach shares dropped six per cent to $1.0175 and Icon stocks dived 19 per cent to 7.3 cents.
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