ADNOC's XRG Agrees to Buy Shell's North West Shelf LNG Stake for $1.45 Billion

Shell said the price is subject to customary adjustments and that it will also receive a further payment if certain milestones are met. The companies have not disclosed the size of that payment or the milestones. The buyers will take on the stake's share of the cost of eventually decommissioning the project. The sale needs regulatory approval, and Shell expects it to close in 2027.

The deal gives XRG its first LNG asset in Australia and a stake in a plant that sells mostly to Asian buyers. It follows XRG's failed takeover bid for Santos last year, when it walked away from an approach for one of Australia's largest oil and gas producers. Since then XRG has said it is still looking for gas assets abroad, and this purchase is far smaller than the Santos deal would have been.

The North West Shelf, operated by Woodside, is Australia's first LNG project and has been running for more than four decades. Its Karratha gas plant, about 1,260 km north of Perth, can liquefy 14.3 million tonnes of gas a year and also produces domestic gas, condensate and liquefied petroleum gas. The project has about 4.4 trillion cubic feet equivalent of resources left, and most of its LNG goes to customers in Japan, according to the partners' figures. Its other owners are Woodside, Chevron, BP, CNOOC and MIMI, a venture of Japan's Mitsui and Mitsubishi. Australia approved an extension of the project's operating life to 2070 last year.

Mohamed Al Aryani, president of XRG International Gas, said: "This investment advances XRG's strategy to build a leading international gas business." He also said XRG understood "the importance of balancing export success with local energy needs" and that continued investment in the plant "can help sustain domestic gas supply" in Western Australia, which has received more than 6,000 petajoules of gas from the project.

For Shell, the sale ends a stake it has held for about 40 years. Cederic Cremers, president of Shell's integrated gas business, said the deal "realises value from a mature, non-operated asset" and lets the company put money into stronger integrated gas positions. He said the project is expected to move over time to a "third-party toll-processing model", under which gas owners pay the plant a fee to liquefy their gas rather than supplying it from the partners' own fields.

The price is well below early estimates. When Shell first tested buyers' interest in September 2025, Bloomberg reported that the stake could be worth more than $3 billion. In February, Bloomberg reported that Shell was in early talks with XRG and with Midocean Energy, which is backed by Saudi Aramco, among other possible buyers.

Shell keeps a large business in Australia after the sale. It runs the QGC gas operation in Queensland, which supplies about 15% of the east coast gas market, and the Prelude floating LNG facility in Western Australia's Browse Basin. It is also developing the Crux field to feed Prelude and holds stakes in Gorgon and Arrow Energy.

XRG, which ADNOC wholly owns, says its enterprise value is more than $150 billion. Before the deal closes, it will need approval from Australian regulators, which have previously looked closely at foreign ownership of the country's gas resources.