Shell in Talks with ADNOC, Others Over $24bn Australia LNG Stake Sale

Shell is reportedly in discussions with ADNOC (through its investment arm XRG), MidOcean Energy, and other potential buyers including Japanese-linked suitors and Asian LNG buyers, regarding the sale of its 16.67 per cent stake in Australia's North West Shelf (NWS) LNG project.

The stake, which could be valued at up to $24 billion, represents a significant portion of Australia's oldest and largest LNG facility, operated by Woodside Energy Group in Karratha, Western Australia.

The North West Shelf project recently had its operational life extended to 2070 from 2030, following its transition to a third-party tolling facility where gas buyers pay fees for liquefaction services. This shift in operations has prompted Shell to consider divesting its stake.

The potential sale comes despite Shell's recent emphasis on LNG growth, with global LNG supply expected to rise by 10 per cent this year and the market expanding at an annual rate of 3 per cent.

Australian regulators have mandated annual emissions reductions for the NWS project, targeting net-zero by 2050 under the Safeguard Mechanism. The project has faced environmental and cultural heritage appeals in recent years.

Industry sources note that a sale to ADNOC or other parties would transfer ownership of the asset rather than reduce global LNG production or emissions.

The North West Shelf project remains a key component of the region's energy infrastructure, with the sale representing a significant portfolio recalibration for Shell amid evolving energy market dynamics.