Shell to Acquire 30% Interest in C$14 Billion Canadian Oil Project

en.Wedoany.com Reported - On October 9, Shell signed an agreement with Equinor under which Shell will acquire a 30% non-operated interest in the Bay du Nord oil development project offshore Newfoundland and Labrador, Canada, while Equinor will retain a 70% interest and continue as project operator. The project is expected to involve total investment of approximately C$14 billion, with a final investment decision planned for early 2027 and first oil targeted for 2031.

The Bay du Nord project is located in the Flemish Pass Basin, approximately 500 kilometers east of Newfoundland and Labrador, Canada, in water depths of 600 to 1,170 meters. The project adopts a phased subsea oil and gas development scheme, transporting oil and gas via a subsea production system and connecting pipelines to a floating production, storage and offloading (FPSO) unit for processing, storage and export. Planned total capacity is 160,000 to 175,000 barrels of oil equivalent per day, and the initial development phase is expected to recover more than 400 million barrels of oil resources.

The initial development scope includes the Bay du Nord field discovered in 2013 and the Cambriol field discovered in 2020. Subsequent development plans also consider tying surrounding discoveries such as Cappahayden, Harpoon and Baccalieu into the production system. The project is currently completing front-end engineering design (FEED), with related work including optimizing capital expenditure, refining the project execution plan and determining development technology configurations. The project parties have previously cooperated with the Canadian federal and provincial governments on development approval and implementation arrangements.

This transaction will change the project's ownership structure. In July 2026, bp withdrew from the Bay du Nord project, selling its previously held 37.2% interest. Shell is participating in the investment through its subsidiary Shell Canada Energy, but will not assume day-to-day operational responsibility for the project. The two parties have not yet disclosed the transaction amount or closing timeline for the 30% interest acquisition. Shell stated that the investment must meet the company's capital return requirements, and subsequent project investment decisions will still require internal capital allocation approval.

Equinor plans to continue advancing engineering design and development plan refinement, and will decide whether to enter the full development and construction phase after market conditions, regulatory approvals and the internal investment decision-making procedures of both partners are satisfied. The proposed production system will center on an FPSO connected to the initial subsea oil fields, with provisions reserved for tying in subsequent surrounding oil and gas discoveries.