Full Breakdown
Shell's $10-$15 Billion LNG Canada Stake Attracts Bids from Apollo, Blackstone and KKR
5/2/2026, 5:35:14 AM
Stake Sale Sparks Bidding War
Shell Plc is looking to sell part of its 40% stake in the LNG Canada project in Kitimat, British Columbia. Three asset-management giants—Apollo Global Management, Blackstone and KKR—are the only remaining bidders, according to three confidential sources. The transaction is expected to be valued between $10 billion and $15 billion and could include both the operating first phase and the planned expansion.
Project Overview
LNG Canada, the first North American LNG export terminal with direct Pacific access, began production in June 2025. The first train delivers 5.6 Mtpa and the full facility is designed for 14 Mtpa, targeting Asian markets. Shell’s recent $16.4 billion purchase of ARC Resources adds gas supply to the project. Other owners of LNG Canada include Japan’s Mitsubishi Corp, Malaysia’s Petronas and MidOcean, a joint venture of EIG and Saudi Aramco.
Bidders and Funding
Apollo, Blackstone and KKR are financing their bids with capital from insurance subsidiaries—Apollo’s Athene, Blackstone Credit & Insurance and KKR’s Global Atlantic—reflecting a broader trend of using low-cost insurance assets for long-duration infrastructure deals.
Deal Valuation
Sources place the potential sale price between $10 billion and $15 billion, with some estimates near the upper bound. The bid could cover the operating phase and the optional second-phase expansion, though exact terms remain undisclosed.
Strategic Implications
The sale signals strong private-capital demand for large-scale energy infrastructure despite market volatility. For Shell, proceeds could fund dividends, share buybacks, debt reduction or new projects while retaining a strategic LNG foothold. The transaction also highlights the premium placed on Pacific-oriented LNG capacity for Asian buyers.
Official Statements
Shell declined comment on the sale. CEO Wael Sawan said the company is “very comfortable” with its 40% stake and is “not necessarily looking at reducing our equity interest,” while stressing cash generation from lower-return assets. Apollo, Blackstone and KKR also declined comment.
Criticism
The previous Canadian federal government argued there was “no business case” for LNG exports, questioning the economic rationale of projects like LNG Canada. Analysts warn that heavy reliance on private-equity financing could raise financial risk if LNG prices stay volatile.
Conflicting Reports
Sources differ on whether the sale will cover only the first phase or also the optional second phase. Shell has not clarified which portion is being offered.
Verbatim Quotes
- “very comfortable” — Wael Sawan, CEO, Shell Plc
- “not necessarily looking at reducing our equity interest,” — Wael Sawan, CEO, Shell Plc
- “CEO Sawan described Canada as a “heartland for Shell.” — Wael Sawan, CEO, Shell Plc
- “makes sense,” — Adam Baker, Morningstar equity analyst
- “not necessarily” — Wael Sawan, CEO, Shell Plc
Next Steps
Shell will report first-quarter results on May 7, likely addressing the ARC acquisition and the LNG Canada stake decision. Any winning bidder will still need regulatory and shareholder approvals before closing.
