Shell Doubles Down on Canadian LNG Expansion

Shell has taken a final investment decision to double the production capacity of its LNG Canada facility in Kitimat, British Columbia. The expansion project, known as Phase 2, will add two additional processing units and a second storage tank, among other infrastructure upgrades.

The expanded facility is expected to boost total production capacity from 14 million tonnes per annum (mtpa) to 28 mtpa by the early 2030s. Shell holds a 40% operating stake in the joint venture alongside PETRONAS, PetroChina and Mitsubishi Corporation, each with 15%, and Korea Gas Corp., with 5%.

Under the venture's equity lifting structure, Shell will directly receive nearly 6 mtpa of additional LNG from the expansion to trade within its global portfolio. The investment is expected to deliver double-digit internal rates of return and support long-term cash flows.