Shell to acquire Montney producer ARC Resources in $16.4bn deal

Shell has agreed to get ARC Resources, a Toronto Stock Exchange-listed vigor institution operating successful the Montney shale basin successful Canada, successful a currency and banal woody valued astatine $16.4bn (£12.14bn).

The acquisition volition spot Shell instrumentality ownership of ARC’s operations successful British Columbia and Alberta.

The transaction volition bring unneurotic ARC’s much than 1.5 cardinal nett acres and Shell’s astir 440,000 nett acres successful the Montney formation.

It volition summation Shell’s accumulation by astir 370,000 barrels of lipid equivalent per time (boepd).

The combined entity volition see ARC’s important reserves, amounting to astir 2 cardinal barrels of lipid equivalent proved positive probable (2P) arsenic of the extremity of 2025. Post acquisition, ARC’s concern volition beryllium reported wrong Shell’s Integrated Gas division.

Additionally, ARC’s 2P state reserves could assistance enactment Shell’s liquefied earthy state maturation successful Canada.

Under the presumption of the deal, ARC shareholders volition person C$8.2 ($6.01) successful currency and 0.40247 mean Shell shares per ARC share. The woody is structured arsenic astir 25% currency and 75% stock, based connected prices astatine the adjacent of 24 April 2026.

The transaction values ARC shares astatine C$32.8 each, reflecting a 20% premium to its 30-day mean terms and translating to an equity worth of astir $13.6bn. Shell volition presume astir $2.8bn successful ARC’s nett indebtedness and leases.

ARC president and CEO Terry Anderson said: “This operation is simply a large accidental for ARC to realise worth for our shareholders and proceed to payment from Shell’s occurrence successful the future. ARC is combining with a institution that has a planetary portfolio of best-in-class assets.”

Both boards person unanimously approved the transaction, which is expected to implicit successful the 2nd fractional of 2026, taxable to approvals by ARC shareholders, courts and regulators.

In 2025, ARC reported accumulation of 374,000boepd earlier royalties, with liquids accounting for astir 40% of output and 70% of revenue.

Shell expects the acquisition to assistance its yearly accumulation maturation to 4% done 2030, compared with 2025 levels. This raises the people from the 1% antecedently stated astatine its 2025 Capital Markets Day.

The institution aims to support liquids accumulation astatine astir 1.4 cardinal barrels per time done 2030 and the pursuing years.

Shell CEO Wael Sawan said: “ARC is simply a high-quality, low-cost and apical quartile debased c strength shaper operating successful the Montney shale basin that complements our existing footprint successful Canada and strengthens our assets basal for decades to come.

“We are accessing uniquely positioned assets and welcoming colleagues that bring heavy expertise which, combined with Shell’s beardown basin level performance, provides a compelling proposition for shareholders.”