At least three international parties have been rumoured to be in the running for the acquisition, namely private equity group Kohlberg Kravis Roberts, Canadian retail fuel operator Couche-Tard and even the state-owned PetroChina group.
BP Australia, which first announced its intention to buy Woolworths' 531 petrol stations in December 2016, today revealed that it was abandoning the plan.
The ACCC opposed the deal in December last year, but BP vowed to fight the decision.
Today it says that 'despite its best efforts' the deal can't be 'structured to meet its strategic objectives'.
Andy Holmes, BP's chief operating officer for Asia-Pacific, today issued a statement indicating BP has moved on from the proposal.
"I am very confident in what the future holds and the delivery of BP's strategy for strong market-led growth to 2021 with a continued focus on safe and reliable operations, increasing efficiency, simplification and modernisation," he says.
Woolworths, in a brief announcement to the ASX, says it is 'continuing to engage actively with alternative options for its petrol business.'
While details of the prime alternative candidates to buy the petrol assets remain under wraps, there has been no shortage of rumours in the market.
The Australian recently reported that another private equity group, BGH Capital, could be in the mix.
BGH Capital was formed in 2017 by ex-TPG Capital Australia head Ben Gray and ex-Macquarie executive Robin Bishop to explore opportunities in Australia and New Zealand.
The BP Australia deal has been on the ropes for some time and it is likely Woolworths' discussions with alternative buyers is well advanced.
News of BP dropping out of the race is widely seen as positive for lifting competition in the national retail petrol market.
ACCC chairman Rod Simms, in rejecting the planned buyout by BP, had noted that BP consistently sold fuel at a higher average price than Woolworths' outlets in capital cities.
The competition for the Woolworths offering is likely to be strong as petrol stations have become a lucrative investment class in the REIT sector in recent years.
Fuel refiner and retailer Viva Energy, which owns 1160 petrol stations across Australia mostly under the Shell brand, has just announced a $5.15 billion float in the largest share offering on the ASX in four years.
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