Shell has agreed to buy Canadian shale producer ARC Resources in a $16.4bn deal aimed at boosting production and delivering long-term value for shareholders. The London-listed oil major will pay 25% cash and 75% shares, offering a 20% premium to ARC's 30-day average share price before the announcement.
The acquisition marks the latest in a series of megadeals signaling a return to core oil and gas operations for petrochemical giants, following years of pivot toward renewable energy. Shell has pledged to ramp up gas production by 4-5% by 2030 and increase oil output by 1%.
According to Shell, the deal supports its goal of producing 1.4 million barrels of oil per day by the end of the decade, combining ARC's 1.5 million net acres of gas fields with Shell's 440,000 acres in Canada's Montney region.
Boards Unanimously Support Transaction
Shell CEO Wael Sawan said the deal establishes Canada as a heartland for Shell while furthering its strategy to deliver more value with fewer emissions. He noted that it complements Shell's existing footprint in Canada and strengthens its resource base for decades to come.
The boards of both companies unanimously supported the transaction, which is expected to close before year-end, subject to approval from ARC shareholders and regulators.
ARC President and CEO Terry Anderson expressed excitement about combining ARC's assets and team with Shell's global portfolio of best-in-class assets, helping to strengthen Canada's resource landscape while providing secure energy.
Shell's share price fell 0.8% in the minutes following the announcement.
