Shell to Double LNG Canada Plant in Multibillion-Dollar Plan

By Ruth Liao, Thomas Seal and Stephen Stapczynski

Sep 29, 2026 (Bloomberg) –Shareholders in the Shell Plc-led LNG Canada venture greenlit plans to double its liquefied natural gas export capacity, forging ahead with the multibillion-dollar investment as key customers in Asia face the biggest supply shock of recent times.

The long-awaited decision to proceed with a second phase of the project in Kitimat, British Columbia, will boost capacity to 28 million metric tons a year, Shell said in a statement on Tuesday. The West Coast plant produced its first LNG in June 2025, and the expansion project is slated to start commercial operations in the early 2030s. 

The second phase is expected to draw about $23 billion of investment, according to the Canadian government.

The Iran war and the near-closure of the Strait of Hormuz have created an unprecedented tightening in global energy markets. That’s spurred LNG importers to seek out supplies beyond the Middle East — benefiting exporters from the US to Nigeria. Canadian Prime Minister Mark Carney has pitched the country as a top candidate to step into the breach, having placed the proposed LNG expansion on a list of “nation-building” developments last year.

Tuesday’s decision underscores Shell’s push to grow in LNG as global majors tout the commodity as a key bridge fuel in the energy transition, despite volatile prices over the last few years. This year, gas prices across much of the world have surged after the Iran war all but halted LNG flows from the Persian Gulf, shifting the market outlook from an expected glut to a squeeze on supply.

Shell holds a 40% stake in LNG Canada, whose location on the country’s west coast gives it an advantage in supplying Asia — home to the world’s biggest LNG buyers — without having to navigate shipping chokepoints.

Other joint-venture partners include Petroliam Nasional Bhd, PetroChina Co., Mitsubishi Corp. and Korea Gas Corp. MidOcean Energy, a unit of private equity firm EIG, also has a stake through Petronas. Korea Gas, which holds 5%, plans to invest a total of about $1.26 billion.  

Read More: Shell Puts Canada at Heart of Growth Plans in $13.6 Billion Deal

Abu Dhabi’s XRG is exploring the acquisition of a stake in the project, and has been holding talks with existing backers including PetroChina about buying some of their holdings in the first phase, Bloomberg reported earlier this month. 

© 2026 Bloomberg L.P.

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