PETROCHINA Co dropped a bid to acquire WestSide Corp as a strong Australian dollar and rising costs discourage resources projects in the country, the Brisbane-based explorer said.

PetroChina withdrew its offer for the coal-seam gas explorer "because the general situation in Australia has changed so much," WestSide said yesterday.

Australia's energy and mining projects have been hit by a high local currency and increasing costs. Woodside Petroleum Ltd, Australia's second-biggest oil producer, scrapped a plan last month to build the Browse LNG project on the Western Australia coast.