Shell takes FID to double LNG Canada capacity

BAKU, Azerbaijan, September 29. Shell Canada
Energy, a subsidiary of Shell plc, has taken a final investment
decision (FID) on the second phase of LNG Canada, a major expansion
that will double the facility’s production capacity, Shell
said.

The Phase 2 project will add two LNG processing units, or
trains, at the existing facility in Kitimat, British Columbia,
increasing LNG Canada’s total production capacity from 14 million
metric tons per annum (mtpa) to 28 mtpa.

Shell holds a 40% stake in LNG Canada and is expected to receive
nearly 6 mtpa of additional LNG from the expansion. Commercial
operations are targeted to start in the early 2030s.

"LNG Canada is a core part of our Integrated Gas portfolio,
helping to supply LNG to customers in Asia at a time when diversity
of energy supplies and energy security are increasingly important,"
said Cederic Cremers, Shell’s Integrated Gas President.

"Phase 2 supports Shell’s strategic objective to be the world’s
leading integrated gas and LNG business by connecting Canadian
resources with Shell’s global LNG portfolio, trading capability and
customer reach," he added.

Shell said the investment is in line with its capital allocation
framework and is expected to generate double-digit returns while
contributing to long-term cash flow growth. The expansion will
include not only two additional LNG trains, but also a new LNG
storage tank, condensate tank and loading berth, along with
expanded utility and process systems.

The Coastal GasLink pipeline will also be expanded to support
the additional production. The 670-kilometre pipeline is expected
to undergo capacity expansion through the construction of five new
compressor stations.

LNG Canada is currently a joint venture between Shell with a 40%
interest, PETRONAS with 25%, PetroChina Company Limited with 15%,
Mitsubishi Corporation with 15%, and Korea Gas Corporation with 5%.
The facility is operated by LNG Canada Development Inc.

Shell said LNG Canada will continue operating under an
equity-lifting model, under which each shareholder is responsible
for marketing its proportionate share of LNG production and
securing the corresponding gas supply. The project is designed to
supply LNG to Asian markets, where Shell expects demand for the
fuel to continue increasing.

According to Shell's 2026 LNG Outlook, global LNG demand is
projected to rise by around 60% by 2040 and approximately 65% by
2050, driven by growing energy consumption and demand for secure,
flexible and reliable energy supplies. Shell expects global LNG
demand to increase from 422 mtpa in 2025 to nearly 700 mtpa by
2050. The company said the additional investment in LNG
liquefaction capacity will be required through the 2030s and 2040s
to meet this projected growth.

Shell also noted that, according to the International Energy
Agency, electricity generated from LNG has, on average, lifecycle
greenhouse gas emissions intensity around 40% lower than
electricity generated from coal. Shell reaffirmed at its 2025
Capital Markets Day that it intends to remain a leading integrated
gas and LNG company through the 2040s.

In Canada, Shell operates across its global business segments,
including Upstream, Integrated Gas, Downstream, and Renewables and
Energy Solutions.

In the third quarter of 2026, Shell also completed its
acquisition of ARC Resources Ltd., a Canadian energy company
operating in British Columbia and Alberta, after receiving the
required shareholder, court and regulatory approvals.

Source: https://www.trend.az/world/europe/4229263.html

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