Shell has agreed to acquire ARC Resources, a Toronto Stock Exchange-listed energy company operating in the Montney shale basin in Canada, in a cash and stock deal valued at $16.4bn (£12.14bn).
The acquisition will see Shell take ownership of ARC’s operations in British Columbia and Alberta.
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The transaction will bring together ARC’s more than 1.5 million net acres and Shell’s approximately 440,000 net acres in the Montney formation.
It will increase Shell’s production by approximately 370,000 barrels of oil equivalent per day (boepd).
The combined entity will include ARC’s substantial reserves, amounting to around two billion barrels of oil equivalent proved plus probable (2P) as of the end of 2025. Post acquisition, ARC’s business will be reported within Shell’s Integrated Gas division.
Additionally, ARC’s 2P gas reserves could help support Shell’s liquefied natural gas growth in Canada.
Under the terms of the deal, ARC shareholders will receive C$8.2 ($6.01) in cash and 0.40247 ordinary Shell shares per ARC share. The deal is structured as around 25% cash and 75% stock, based on prices at the close of 24 April 2026.
The transaction values ARC shares at C$32.8 each, reflecting a 20% premium to its 30-day average price and translating to an equity value of approximately $13.6bn. Shell will assume roughly $2.8bn in ARC’s net debt and leases.
ARC president and CEO Terry Anderson said: “This combination is a great opportunity for ARC to realise value for our shareholders and continue to benefit from Shell’s success in the future. ARC is combining with a company that has a global portfolio of best-in-class assets.”
Both boards have unanimously approved the transaction, which is expected to complete in the second half of 2026, subject to approvals by ARC shareholders, courts and regulators.
In 2025, ARC reported production of 374,000boepd before royalties, with liquids accounting for around 40% of output and 70% of revenue.
Shell expects the acquisition to lift its annual production growth to 4% through 2030, compared with 2025 levels. This raises the target from the 1% previously stated at its 2025 Capital Markets Day.
The company aims to maintain liquids production at roughly 1.4 million barrels per day through 2030 and the following years.
Shell CEO Wael Sawan said: “ARC is a high-quality, low-cost and top quartile low carbon intensity producer operating in the Montney shale basin that complements our existing footprint in Canada and strengthens our resource base for decades to come.
“We are accessing uniquely positioned assets and welcoming colleagues that bring deep expertise which, combined with Shell’s strong basin level performance, provides a compelling proposition for shareholders.”
