Shell has agreed a $16.4 billion (£12.1 billion) deal to acquire Canadian energy firm ARC Resources, aiming to boost its gas production and reserves. The British energy giant stated that the acquisition will strengthen its resource base "for decades to come."
Strategic Expansion in North America
The deal will enhance Shell's presence in North America, where it already operates gas plants. It combines ARC's more than 1.5 million net acres of land with Shell's approximately 440,000 acres in the Montney gas resource in Canada. Shell expects this to increase its production growth rate from 1% to 4% through to 2030, compared with 2025.
CEO Comments
Shell's chief executive, Wael Sawan, said acquiring the "high quality, low-cost" energy business "strengthens our resource base for decades to come." He added: "We are accessing uniquely positioned assets and welcoming colleagues that bring deep expertise which, combined with Shell's strong basin level performance, provides a compelling proposition for shareholders. This establishes Canada as a heartland for Shell while furthering our strategy to deliver more value with less emissions."
Shift in Strategy
Shell has been pursuing a new growth strategy focused on extracting more oil and gas, moving away from a heavy emphasis on green energy and reducing spending on renewables. The company hopes this shift will support production targets and drive greater returns for investors.
Recent Challenges
The announcement comes weeks after Shell cut its gas production outlook for the first quarter of 2026, citing the impact of the conflict in the Middle East. Volumes from Qatar were particularly affected during recent attacks, leading to a trimmed guidance for integrated gas production.
Deal Details
Under the terms, ARC shareholders will receive 8.20 Canadian dollars (£4.50) and approximately 0.4 Shell shares for each ARC share. Including about $2.8 billion (£2.1 billion) in debt that Shell will assume, the acquisition is valued at around $16.4 billion (£12.1 billion). The transaction is expected to close in the second half of 2026, pending shareholder, court, and regulatory approvals.
