OK, I just ran in to this.. but unfortunately there was no timeout after 30 minutes that got it working. Fortunatly nelasx had correctly diagnosed it, and given the fix. I'm adding this to give the steps I had to take based on his excellent question and commented answer. I've just pulled the info I had to gather together in one place, to get to a solution.
Symptoms: on startup of the google instance - getting connection refused
After inspecting serial console output, will see:
Jul 8 10:17:14 instance-1 google: Waiting for metadata server, attempt 412
You could try waiting, didn't work for me, and inspection of https://github.com/GoogleCloudPlatform/compute-image-packages/blob/master/google-startup-scripts/usr/share/google/onboot
# Failed to resolve host or connect to host. Retry indefinitely.
6|7) sleep 1.0
log "Waiting for metadata server, attempt ${count}"
Led me to believe that will not work.
So, the solution was to fiddle with the disk, to add in nelasx's solution:
"edit ifcfg-eth and change PEERDNS=no edit /etc/resolv.conf and put on top your nameservers + search domain edit /etc/hosts and add: 169.254.169.254 metadata.google.internal"
To do this,
Best to create a snapshot backup before you start in case it goes awry
Uncheck "Delete boot disk when instance is deleted" for your instance
Delete the instance
Create a micro instance
Mount the disk
sudo ls -l /dev/disk/by-id/* # this will give you the name of the instances
sudo mkdir /mnt/new
sudo mount /dev/disk/by-id/scsi-0Google_PersistentDisk_instance-1-part1 /mnt/new
where instance-1 will be changed as per your setup
Go in an edit as per nelasx's solution - idiot trap I fell for - use a relative path - don't just sudo vi /etc/hosts use /mnt/new/etc/hosts - that cost me 15 more minutes as I had to go through the: got depressed, scratched head, kicked myself cycle.
Delete the debug instance, ensuring your attached disk delete option is unchecked
Create a new instance matching your original with the edited disk as your boot disk and fire it up.