Apollo, Blackstone, and KKR Compete for Shell's LNG Canada Stake: Sources

• Shell is selling exposure to both operational Phase 1 and proposed Phase 2 of LNG Canada to a single bidder, after announcing the sale process in January following its $16.4 billion acquisition of ARC Resources
• All three competing asset managers are leveraging capital from their insurance subsidiaries (Apollo's Athene, Blackstone Credit & Insurance, and KKR's Global Atlantic) to fund their bids, using insurance assets as a low-cost funding source for infrastructure investments
• LNG Canada is the first major North American LNG facility with direct Pacific access for shipping to Asian markets, with other stakeholders including Mitsubishi, Petronas, and a Saudi Aramco-EIG joint venture

Summary: Apollo, Blackstone, and KKR Compete for Shell's LNG Canada Stake

Key Development:

Apollo Global Management, Blackstone, and KKR have emerged as final bidders for a significant stake in Shell's LNG Canada project. The deal is expected to be valued between $10-15 billion, with all parties maintaining confidentiality.

Transaction Details:

Shell is selling a portion of its 40% stake in LNG Canada, with the sale encompassing exposure to both operational and proposed expansion phases of the project. The company plans to sell to a single bidder rather than splitting the phases. Shell retains the option to keep some or all of the stake if negotiations don't meet expectations.

Strategic Context:

The sale follows Shell's recent $16.4 billion acquisition of Canadian natural gas producer ARC Resources announced Monday. Shell CEO Wael Sawan indicated the company is "very comfortable" with its current stake but seeks to generate cash from lower-return assets.

LNG Canada Project:

The facility, which began operations in June, is North America's first major LNG facility with direct Pacific access, enabling shipments to Asia—the largest LNG market. Other stakeholders include Mitsubishi Corp, Malaysia's Petronas, and MidOcean (a joint venture of EIG and Saudi Aramco).

Market Dynamics:

North American energy assets have gained appeal amid the US-Iran conflict, which has disrupted Middle Eastern supply. All three bidders are leveraging capital from their insurance divisions (Apollo's Athene, Blackstone Credit & Insurance, and KKR's Global Atlantic) to fund bids, as infrastructure assets suit insurance portfolios due to their lower risk and long-term returns.

Broader Trend:

Asset managers increasingly use insurance assets as low-cost funding for strategic investments, particularly in infrastructure.