$23B LNG Canada Phase 2 Expansion Receives Shell Approval in British Columbia

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Shell and its four partners have approved LNG Canada Phase 2, doubling the Kitimat plant in British Columbia to 28 million tonnes a year. The expansion will add two liquefaction trains to the existing facility, and commercial operations are expected in the early 2030s. Canada’s Major Projects Office estimates the project will draw C$33 billion ($23.2 billion) of private capital.

The joint venture consists of Shell (40%), PETRONAS (25%), PetroChina (15%), Mitsubishi Corporation (15%) and Korea Gas Corporation (5%). LNG Canada announced the final investment decision on September 28, 2026, and Prime Minister Mark Carney highlighted it in Vancouver the following day. Shell said it will receive nearly 6 million tonnes a year of the additional LNG and expects double-digit returns. The joint venture has not published a capital cost for the expansion, although the Globe and Mail reported ahead of the announcement that the partners were set to proceed with a project worth more than C$30 billion.

LNG Canada Phase 2 Adds Two Trains and Doubles Kitimat Capacity to 28 Mtpa

LNG Canada Phase 2 will add two liquefaction trains within the existing Kitimat facility, which sits in the traditional territory of the Haisla Nation. In addition, the scope includes an LNG storage tank, a condensate tank, a loading berth and expanded utility and process systems. According to the joint venture, Phase 1 was designed from the outset to support a four train site, the first of its kind in Canada.

The additional 14 million tonnes a year equals the entire output of Phase 1, so the finished plant would produce twice today’s volume. Moreover, the company says West Coast cargoes reach Asian buyers in about 10 days, roughly half the sailing time from the U.S. Gulf Coast via the Panama Canal.

Gas will keep arriving through the Coastal GasLink pipeline from the Montney Formation. As a result, LNG Canada has agreed to act as execution manager while Coastal GasLink adds five compressor stations to its existing 670 kilometer line. Each partner will continue to lift its own share of LNG under the equity structure used in Phase 1.

LNG Canada Phase 2 to Peak at 4,000 Construction Jobs in Kitimat

At peak, LNG Canada Phase 2 is expected to host up to 4,000 construction workers in Kitimat, with about 2,100 more building compressor stations along the Coastal GasLink route. Furthermore, the expansion is projected to add about 90 full-time roles and 150 contractor positions to a Kitimat workforce that already exceeds 400 permanent jobs. For scale, LNG Canada says Phase 1 drew on more than 50,000 Canadians, with a further 25,000 working on the pipeline.

First Nations ownership forms part of the financing. On July 14, 2026, LNG Canada announced an equity option with MNT Investments LP, a partnership of economic development bodies for the Gitga’at, Gitxaała, Haisla, Kitselas and Kitsumkalum nations. The Phase 2 decision enables an investment of up to C$1 billion in a special purpose entity that will buy the future LNG storage tank.

LNG Canada chief executive Chris Cooper called Phase 2 “another nation-building investment.” In addition, the company estimates the project could generate more than $50 billion in government revenues over its life, counting direct spending, taxes and royalties.

LNG Canada Phase 2 Draws Political Backing and Emissions Scrutiny

Ottawa referred LNG Canada Phase 2 to the Major Projects Office in September 2025, and Budget 2025 included measures to improve the competitiveness of Canadian LNG, including accelerated capital cost allowances. Energy and Natural Resources Minister Tim Hodgson described the decision as a vote of confidence in Canada. Meanwhile, Carney has positioned the expansion as central to making Canada an energy superpower and diversifying exports away from the United States.

Opposition remains. The B.C. Greens have called for a moratorium on LNG expansion, and critics cited by CBC say a larger plant would sharply increase provincial emissions.

That emissions debate is shaping other B.C. projects too. The Woodfibre LNG project near Squamish is taking the opposite route for a 2.1 million tonne a year plant, using electric drive liquefaction powered by BC Hydro electricity. Woodfibre reached 65% completion in March 2026, when its liquefaction and powerhouse modules arrived as the 15th and 16th of 19 modules, and construction is still scheduled to finish in 2027.

Project Overview

• Project Name: LNG Canada Phase 2 expansion
• Owners: Shell (40%), PETRONAS (25%), PetroChina (15%), Mitsubishi Corporation (15%), Korea Gas Corporation (5%)
• Location: Kitimat, British Columbia, Canada
• Project Type: LNG export facility expansion
• Project Value: Not publicly disclosed by the joint venture; C$33 billion ($23.2 billion) of private capital estimated by the Major Projects Office
• Capacity: From 14 to 28 million tonnes a year
• Scope: Two LNG trains, one LNG storage tank, one condensate tank, one loading berth and expanded utilities
• Pipeline Works: Five new compressor stations on the 670 kilometer Coastal GasLink line
• Status: Final investment decision announced September 28, 2026
• Construction Start: Not publicly disclosed
• Target Operations: Early 2030s
• Construction Jobs: Up to 4,000 in Kitimat and about 2,100 along the pipeline at peak
• Permanent Jobs: About 90 full-time and 150 contractor roles
• Indigenous Equity: Option for up to C$1 billion through MNT Investments LP
• Regulatory Framework: Project of National Significance under the Major Projects Office

Project Team

Joint Venture Participants

• Lead Participant (40%): Shell
• Participant (25%): PETRONAS
• Participant (15%): PetroChina
• Participant (15%): Mitsubishi Corporation
• Participant (5%): Korea Gas Corporation

Operator and Delivery

• Facility Operator: LNG Canada Development Inc.
• Pipeline Owner: Coastal GasLink
• Pipeline Parent Company: TC Energy
• Main Contractor: Not publicly disclosed

Public Bodies

• Federal Review Body: Major Projects Office, Government of Canada
• Federal Department: Natural Resources Canada
• Provincial Government: Government of British Columbia

Indigenous Partners

• Equity Option Holder: MNT Investments LP, representing Gitga’at Nation, Gitxaała Nation, Haisla Nation, Kitselas First Nation and Kitsumkalum First Nation

Related Project: Woodfibre LNG

• Developer: Woodfibre LNG
• Co-owner (30%): Enbridge
• Majority Owner (70%): Pacific Energy Corporation
• Contractor: McDermott International
• Power Supplier: BC Hydro
• Environmental Regulator: Squamish Nation