Shell and Mitsubishi Weigh Selling Stakes in CA$40 Billion LNG Canada Project

2026-01-18 chemical

The Hague, Sunday 18 January 2026
Shell and Mitsubishi are reportedly consulting advisors to divest equity in the CA$40 billion LNG Canada facility. With a Phase 2 expansion decision due in 2026, Shell may sell up to 30 per cent of the venture, potentially requiring a US$15 billion commitment from buyers to secure the stake and fund future capacity doubling.

Strategic Reallocation and Advisory Appointments

According to industry reports emerging on 16 January 2026, Shell has engaged Rothschild & Co to gauge market interest in divesting up to 30 per cent of the project, although the major intends to retain a residual stake and its role as the facility’s operator [2][5]. Concurrently, Mitsubishi Corporation has appointed RBC Capital Markets to explore options for its entire 15 per cent holding in the venture, with formal marketing efforts for this stake expected to commence later in 2026 [2][7]. Together, these potential divestments could see a combined 45 per cent of the project’s equity change hands, marking a significant restructuring of the ownership consortium [2][4].

Valuation and Expansion Commitments

The financial implications of this potential sale are substantial, reflecting both the scale of the asset and the capital requirements of the upcoming expansion. Analysts estimate that a buyer for Shell’s available stake alone would need to commit approximately US$15 billion (15 billion), a figure that encompasses the initial equity purchase, assumed debt obligations, and the necessary capital contributions for the proposed Phase 2 expansion [2][7]. This liquidity event is timed critically, as the partners are working towards a Final Investment Decision (FID) for Phase 2 in 2026, which aims to double the facility’s export capacity [2][5].

Operational Context and Market Precedents

These strategic deliberations are unfolding against a backdrop of both operational milestones and technical challenges. While Phase 1 of LNG Canada has been exporting liquefied natural gas since June 2025, the facility faced a setback when its second processing unit (Train 2) went offline in early December 2025, approximately one month after its startup [2][7]. Despite these temporary hurdles, the long-term fundamentals remain a key focus, with the Phase 2 expansion projected to increase the total export capacity from the current 14 million metric tons per annum to 28 million metric tons per annum [5][7]. The market has already seen successful equity rotation in this asset; in December 2025, MidOcean Energy—backed by EIG and Saudi Aramco—finalised the purchase of a portion of Petronas’s 25 per cent stake, validating investor appetite for Canadian LNG infrastructure [2][5].

Sources & Ecosystem Partners

Energy divestment LNG infrastructure