XRG eyes LNG Canada stake as global gas portfolio expands
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Abu Dhabi energy company XRG is considering an investment in LNG Canada as it builds a larger international natural gas business across several producing regions.
The company has held discussions with existing LNG Canada investors, including PetroChina, about acquiring part of their holdings, according to Bloomberg. No transaction has been agreed, and there is no certainty the talks will lead to a deal.
The discussions come at an important point for LNG Canada. The Shell-led project began exporting liquefied natural gas from Kitimat, British Columbia, in 2025 and is now considering a second phase that could significantly increase production capacity.
For XRG, an investment would add another major LNG position to a portfolio that already includes assets and projects in the US and Argentina. It could also give the Abu Dhabi company direct exposure to LNG exports from Canada’s Pacific Coast.
That location gives western Canadian LNG a direct shipping route to major Asian markets. It also gives the project a different geographic position from LNG plants on the US Gulf Coast.
LNG Canada is moving from startup toward possible expansion
LNG Canada has two operating production trains with combined capacity of about 14 million metric tons per year. The project is backed by Shell, Petronas, PetroChina, Mitsubishi and KOGAS.
Attention is now turning to a possible second phase.
In June 2026, the JGC and Fluor joint venture that helped deliver the first phase received a limited notice to proceed for work on the proposed Phase 2 expansion. The work is intended to improve project certainty before a possible final investment decision.
A second phase could roughly double the facility’s LNG production capacity to about 28 million metric tons per year.
That creates a different investment case from the one partners faced while the first phase was under construction. The project is now operating, while further growth remains under review.
A new shareholder would therefore be investing in an operating plant that also has the potential for further expansion.
The timing may also matter for existing owners. Large LNG developments require substantial capital, and project partners often review how much they want to invest as their wider spending plans change.
For XRG, an operating plant with an expansion option could complement investments in projects that are still at earlier stages of development.
XRG is building LNG positions across several regions
The possible Canadian investment follows a series of international gas transactions by XRG.
In July, the company completed the acquisition of a 7.6% interest in Trains 4 and 5 of the Rio Grande LNG project in Brownsville, Texas. That followed an earlier indirect 11.7% investment in the project’s first three trains.
Together, the transactions give XRG interests across all five LNG trains under construction at Rio Grande LNG. The five-train development is expected to have production capacity of about 30 million metric tons per year.
XRG has also expanded into upstream gas production.
In June, it agreed to acquire a 32% interest in three blocks in Argentina’s Vaca Muerta basin. Eni is also set to take 32%, while Argentina’s YPF would retain 36%.
The blocks are expected to supply gas to the planned Argentina LNG project, which is designed for 12 million metric tons per year of export capacity. The transaction remains subject to regulatory approvals.
These investments show that XRG is spreading its holdings across different parts of the LNG supply chain and several producing countries.
Canada would add another North American source, but with different access to international markets from Texas. Argentina could provide another source of Atlantic LNG if the planned development moves forward.
That geographic mix may become more important as XRG and its parent group expand their LNG marketing operations.
ADNOC launched an integrated LNG marketing and trading platform in July that combines marketing activities from ADNOC Gas and XRG with ADNOC Trading. The group is targeting 47 million metric tons per year of marketable LNG by 2035.
Access to LNG from several regions can give a supplier more choice over where cargoes are sourced and sold. It can also reduce reliance on one production center or shipping route.
Canadian LNG is taking a larger role in global supply
The reported XRG discussions also reflect Canada’s changing position in the international gas market.
Canada has long been a major natural gas producer, but most of its gas exports have historically moved by pipeline to the US. LNG Canada gives western Canadian gas direct access to overseas buyers.
For Asian customers, that adds another potential source of supply alongside countries including Australia, Qatar and the US.
For investors, the appeal extends beyond current production. LNG Canada combines an operating export plant with access to western Canadian gas resources and the possibility of additional liquefaction capacity.
An XRG transaction remains uncertain. The discussions are preliminary, according to the Bloomberg report, and the size or structure of any possible investment has not been disclosed.
Even so, the talks are consistent with XRG’s recent international gas investments.
The company has been adding gas and LNG interests in regions that can serve different markets. A stake in LNG Canada would add western Canada to that portfolio as the project considers its next stage of growth.
The outcome will depend on whether XRG and an existing shareholder can agree on terms. Regardless of the result, the discussions show that Canada’s entry into LNG exports is drawing interest from companies building international gas portfolios.
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