Shell is stepping out of the North West Shelf (NWS) project in Western Australia. Shell Australia, a wholly owned subsidiary of Shell plc, has signed an agreement to sell its 16.67% non-operated interest to wholly owned subsidiaries of XRG P.J.S.C. The base consideration is US$1.45 billion, subject to customary adjustments, plus an additional milestone-linked contingent payment.

The sale is a cash-for-position trade. Shell gets paid for a stake it does not operate, and it keeps its capital pointed at the LNG and integrated gas assets it prefers.

Deal terms

The transaction has an effective date of 1 January 2026 and is expected to close in 2027. Closing is subject to several conditions precedent, including regulatory approvals.

The buyers also take on decommissioning obligations and will provide security with respect to them. Shell's interest covers upstream interests, pipeline and midstream infrastructure, varying participating interests in related petroleum and pipeline titles, project agreements, offtake arrangements, NWS project companies, and CNOOC-related joint ventures.

Shell's stated rationale

Cederic Cremers, Shell's Integrated Gas President, said the agreement reflects the company's commitment to disciplined capital allocation and portfolio choices. He described NWS as a mature, non-operated asset and said the sale supports Shell's strategy of focusing investment on advantaged integrated gas positions. He added that NWS is expected to move in the future toward a third-party toll-processing model.

Cremers also said Shell is proud of its role as a founding partner in NWS and of what the project has meant to Western Australia.

What is changing at the project

The NWS project is an LNG and domestic gas development in Western Australia. It comprises a number of interconnected joint ventures involving Woodside Energy, Chevron, BP, Shell, MIMI and CNOOC.

Production from the original NWS fields is declining. That has freed up capacity at the project's Karratha Gas Plant, and NWS is moving to a mixed business of resource production and third-party toll processing.

The Browse project is part of the same story. Shell sold its interest in Browse in 2023. Browse is a proposed offshore gas development whose concept involves piping gas from the Browse Basin to Karratha for processing and export through existing NWS infrastructure.

Shell's position in Australia

Shell says it continues to invest in LNG and integrated gas globally and will grow LNG sales by 4-5% per year to 2030. In Australia it operates the Shell QGC project and Prelude FLNG, is developing the Crux project, and is a joint venture partner in Arrow Energy and Gorgon.

The buyer

XRG P.J.S.C. is an international energy investment company focused on building a global portfolio across natural gas, chemicals and energy solutions. Its subsidiaries are the acquiring entities here.