Shell Canada Energy, an affiliate of Shell plc, has reached a final investment decision on LNG Canada Phase 2, a major expansion project that will double the facility’s production capacity in Kitimat, British Columbia.
Phase 2 will add two liquefaction trains, increasing LNG Canada’s production capacity from 14 MTPA to 28 MTPA. The expansion also includes construction of an additional liquefied natural gas (LNG) storage tank, condensate tank, marine loading berth, and associated utility, and process infrastructure. To support the increased gas supply, Coastal GasLink plans to expand the capacity of its existing 416-mile (670-km) pipeline through the addition of five new compressor stations.
With a 40% stake in LNG Canada, Shell will receive nearly 6 MTPA of additional LNG from the expansion. Commercial operations are expected to begin in the early 2030s. LNG Canada is a joint venture comprising Shell (40%), Petronas (25%), PetroChina Company Limited (15%), Mitsubishi Corporation (15%), and Korea Gas Corporation (5%). The facility is operated by LNG Canada Development Inc.
Strategically positioned on Canada’s West Coast, the facility is designed to serve growing demand in Asian markets, where LNG consumption is expected to rise significantly in the coming decades. According to Shell’s LNG Outlook 2026, global LNG demand is projected to increase by approximately 60% by 2040 and 65% by 2050, driven by expanding energy requirements and the continued shift toward lower-emissions fuels.
