Woodside Petroleum has approved development of the $2.5 billion Greater Western Flank Phase 1 gas project off the north-west coast, but softer oil prices sent its shares lower.

Woodside shares finished down 76 cents, or 2.26 per cent, at $32.90 on Thursday.

The energy sector drove losses in the broader market of about 0.27 per cent, with Santos falling 52 cents, or 3.85 per cent, to $13.00.

New York’s main contract, light sweet crude oil for January delivery, eased 79 cents to $US100.49 a barrel as traders expressed concern over whether the looming EU summit would fully resolve the eurozone debt crisis.

Woodside said the first phase of the Greater Western Flank project, which is part of the massive North West Shelf project and will tap the Goodwyn GH and Tidepole fields, would cost about $2.5 billion to develop.

Project start-up is expected early in 2016.

Chief executive Peter Coleman said the project would maintain supply to the Karratha gas plant and support the North West Shelf project’s ongoing marketing efforts for domestic gas and liquefied natural gas.

“The project will continue to maximise the value of existing infrastructure and demonstrates ongoing investment in Australia’s largest resource project,” Mr Coleman said in a statement.

Separately, Norway’s prime minister Jens Stoltenberg will meet with Mr Coleman as part of a visit to Perth on Friday.

The pair will address an oil and gas sector information exchange between Woodside and Mr Stoltenberg’s Norwegian delegation, with topics for discussion including opportunities for cooperation, a Woodside spokesman told AAP on Wednesday.

Norway is a major oil exporter and is the largest gas producer of the OECD Europe countries.