Shell sees strong case for second phase of LNG Canada after conversations with governments
Shell’s $16.4 billion ARC Resources deal could help secure gas supply for a Phase 2 expansion that would double LNG Canada’s capacity, analysts said.
- On Monday, Shell PLC announced a $22-billion acquisition of Calgary-based ARC Resources Ltd., boosting the likelihood of expanding the LNG Canada export terminal in Kitimat, British Columbia to 28 million tonnes annually.
- After selling the majority of its Canadian oilsands operations for $11 billion in 2017, the London-headquartered energy giant now reverses course, re-establishing Canada as a strategic "heartland" for energy investments.
- Chief executive Wael Sawan cited "growing confidence" in federal and provincial government posture, noting this has "raised the likelihood" of proceeding with Phase 2, which would double capacity from 14 million to 28 million tonnes per year.
- Securing the Montney basin portfolio grants Shell access to 1.5 million net acres of assets, where liquids production comprises roughly 70 per cent of revenues, enabling supply to Asian markets via the existing LNG Canada facility.
- A final investment decision on the expansion is expected later this year as global energy demand strengthens amid Middle East supply disruptions, positioning LNG Canada Phase 2 as a critical outlet for Western Canadian natural gas.
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The Epoch Times
Canadian ManufacturingBlockbuster $22B Shell-Arc Deal Bodes Well for Expansion to LNG Canada, Experts Say
Global energy heavyweight Shell PLC’s plan to buy one of Canada’s biggest natural gas producers bolsters the likelihood an expansion of the LNG Canada plant will move ahead, industry experts say. The deal to buy Calgary-based ARC Resources Ltd. is valued at $22 billion, accounting for the target company’s debt. It gets Shell access to ARC’s holdings in the prolific Montney shale formation that last year produced 374,000 barrels of oil equivalent…
Shell wants to buy a major Canadian oil and gas company for 13.6 billion dollars (12 billion euros). The acquisition of Arc Resources is the largest since...
ANALYSIS | How Shell's $22B deal could spur more investment in Canada's oilpatch
After selling off a large chunk of its Canadian assets nearly a decade ago, U.K.-based energy giant Shell is now expanding its operations in Alberta and British Columbia by acquiring Calgary-based ARC Resources for $22 billion.
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