Nexus Energy Shares Sink as Sale of Gas Project Stake Collapses

By Angela Macdonald-Smith

Oct. 8 (Bloomberg) -- Nexus Energy Ltd., developer of the proposed $1.2 billion Crux natural gas liquids project off Australia's north, fell the most in a year in Sydney trading after the $255 million sale of a stake in the venture collapsed.

Nexus dropped as much as 21 Australian cents, or 19 percent, to 88 cents, the lowest since April 4, 2007. The shares were at 90 cents at 10:11 a.m. local time.

The proposed buyer for the 25 percent stake in the project in the Timor Sea failed to win board approval for the purchase because of ``global market conditions,'' Melbourne-based Nexus said in a statement sent late yesterday to the Australian stock exchange. Nexus hired Deutsche Bank AG to manage a new sales process.

The other part of the originally proposed transaction, the sale of a 20 percent stake in the AC/P41 exploration permit for $20 million in cash plus drilling costs, was completed to Mitsui & Co.'s Australian unit, Nexus said yesterday.

While Nexus didn't identify Mitsui as the original buyer of the stake in Crux, it said Sept. 10 it had signed an initial accord with one company for the sale of interests in both the project and the exploration permit.

To contact the reporter on this story: Angela Macdonald-Smith in Sydney at amacdonaldsm@bloomberg.net