Woodside Petroleum and Petro- China said yesterday that an outline agreement for the Australian energy group to supply liquefied natural gas estimated to be worth about A$45bn (US$41bn) had expired without a firm accord being reached.

The agreement struck in 2007 to supply up to 3m tonnes of LNG a year to the Chinese oil and gas group for up to 20 years was at the time hailed as potentially Australia's biggest export contract. The commercial terms of the negotiation between the parties were kept confidential, but it is understood initial plans to begin gas sales to PetroChina from 2013 were not feasible.

Woodside and its partners are not expected to reach a so-called final investment decision on the proposed Browse venture in Western Australia – the project that would have supplied Petro-China – until the middle of 2012. The first gas shipments are unlikely until a few years after that.