Shell Canada Energy, an affiliate of Shell plc, has taken a final investment decision (FID) on Phase 2 of the LNG Canada export facility in Kitimat, British Columbia, effectively doubling the plant’s total production capacity.
The expansion will add two additional processing units, known as liquefaction trains, increasing the facility’s output from 14 million tonnes per annum (mtpa) to 28 mtpa. Shell holds a 40 per cent working interest in the LNG Canada joint venture and will receive approximately 6 mtpa of additional LNG from the Phase 2 expansion. Commercial operations are scheduled to commence in the early 2030s.
Cederic Cremers, Integrated Gas President at Shell, stated that the expansion advances the company’s strategy to expand its global integrated gas portfolio, linking Canadian natural gas reserves with Asian demand centers seeking energy security and supply diversification.
The investment aligns with Shell’s capital discipline parameters and is projected to deliver double-digit financial returns while supporting long-term cash flow generation.
According to Shell’s LNG Outlook 2026, global LNG demand is projected to expand by roughly 60 per cent by 2040 and 65 per cent by 2050—rising from 422 mtpa in 2025 to nearly 700 mtpa by mid-century—requiring sustained capital deployment in new liquefaction infrastructure through the 2030s and 2040s.
Data from the International Energy Agency (IEA) indicates that electricity generated from imported LNG emits approximately 40 per cent fewer lifecycle greenhouse gas emissions on average compared to coal-fired power generation.
