Shell Takes FID to Double LNG Canada Capacity
September 29, 2026
Shell Canada Energy has taken a final investment decision (FID) on LNG Canada Phase 2, an expansion that will double the Kitimat facility's production capacity to 28 million tonnes per annum.
Phase 2 will add two LNG processing trains to the existing facility in British Columbia, increasing capacity from 14 mtpa, with commercial operations expected to begin in the early 2030s.
Shell holds a 40% interest in LNG Canada and expects to receive nearly 6 mtpa of additional LNG from the expansion.
The project will also add an LNG storage tank, a condensate tank and a loading berth, as well as expanded utility and process systems. Coastal GasLink will expand the capacity of its existing 670-kilometre pipeline by constructing five new compressor stations.
"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.
“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,” said Cederic Cremers, Shell’s Integrated Gas President.
LNG Canada is owned by Shell with 40%, Petronas with 25%, PetroChina Company Limited and Mitsubishi Corporation with 15% each, and Korea Gas Corporation with 5%. The facility is operated by LNG Canada Development.
The project will continue to operate under an equity lifting structure, under which each partner is responsible for taking its proportionate share of LNG production and supplying its corresponding share of feed gas.
Shell expects the Phase 2 investment to generate double-digit returns and an internal rate of return above the hurdle rate for its Integrated Gas business.
