Shell's Strategic Pivot: LNG Expansion and Portfolio Reshaping

Shell advances European LNG supply via Greece, considers selling a stake in Australia's North West Shelf, and continues its $3.5 billion share repurchase program through 2026.

Energy giant Shell is executing a multi-pronged strategy, simultaneously increasing its foothold in the European liquefied natural gas (LNG) market while considering divestments in its asset portfolio. This restructuring unfolds alongside a substantial share repurchase initiative, which continues despite sector headwinds.

Share Buybacks Proceed Amid Market Pressures

Demonstrating confidence in its financial position, Shell is maintaining its $3.5 billion share buyback program announced with its fourth-quarter results. The repurchases are being executed daily across several European trading venues, with independent trading decisions managed by Morgan Stanley. Regulatory filings frequently show daily withdrawals exceeding one million shares. The program is scheduled to run until early May 2026.

This commitment comes against a backdrop of a softer oil price environment and weaker performance in the chemicals division. The share price has shown notable resilience, trading at €34.69—a level close to its recent 52-week high.

European LNG Access Secured via Greek Corridor

A central element of Shell's growth plan is a newly signed memorandum of understanding with Metlen Energy & Metals PLC. The agreement outlines the supply and trading of approximately 0.5 to 1.0 billion cubic meters of LNG annually, spanning the period from 2027 to 2031.

These volumes are slated to enter the European market through Greece's Revithoussa and Alexandroupolis regasification terminals. A key strategic component is the Vertical Gas Corridor, designed to enhance physical access to markets beyond Southeastern Europe. This structured supply chain provides Shell with greater flexibility to meet regional demand and navigate Europe's evolving regulatory landscape.

Australia: Minority Stake Sale Under Consideration

In parallel, reports indicate Shell is engaged in preliminary discussions regarding the sale of a minority stake in the North West Shelf gas export facility in Western Australia. The project, Australia's oldest and largest liquefaction plant, carries an estimated valuation of around A$34 billion. Potential counterparties in the talks are said to include Abu Dhabi National Oil Company and Midocean Energy LLC.

Shell currently holds a 16.67% interest in the venture. Notably, the facility is expected to transition to a tolling structure, where buyers would pay a fixed fee to liquefy their gas. This shift suggests a strategic move away from full vertical integration toward more predictable infrastructure-based earnings.

This potential partial divestment aligns with Shell's ongoing regional portfolio review. In 2023, the company sold its stake in the Browse project, which was initially intended to supply gas to the North West Shelf facility.

The Path to Early 2026

With the current buyback window closing in early May 2026, investors will be monitoring Shell's progress on two fronts: the translation of its Greek LNG partnership into tangible supply flows, and the materialization of a partial sale for the North West Shelf asset. These moves collectively signal a focused recalibration of the company's energy portfolio.