Key Points:
- Shell agreed to buy ARC Resources for $16.4 billion, marking a massive return of foreign money to Canada.
- The ongoing Middle East conflict pushes international oil operators to look for safer investment environments.
- Prime Minister Mark Carney created a friendlier business climate by rolling back climate rules.
- Experts view Canada’s Tourmaline Oil, valued at $13.2 billion, as the next major acquisition target.
Canada’s oil and gas producers are catching the eyes of the world’s biggest energy companies. After a long hiatus, global oil and gas giants want to invest in Canadian assets again. Shell sent the clearest signal of this massive shift. The company agreed to buy ARC Resources for $16.4 billion. This huge deal marks a major change in how the world views Canadian energy.
Other major players plan to follow Shell’s lead. Companies like TotalEnergies, ConocoPhillips, Equinor, and BP are taking a fresh look at Canadian competitors. Behind the scenes, these energy giants recently asked investment bankers to create lists of logical takeover targets across the country. They want to find the best deals available in the current market.
This renewed interest completely reverses a trend that lasted for an entire decade. Over the past ten years, foreign companies have slowly sold off their stakes in Canada’s fossil fuel sector. Many of the biggest international operators specifically abandoned the Alberta oil sands. Investors were deeply worried about the environmental impact of producing thick, tarry oil. Because foreign companies left, Canadian ownership in the oil sands grew from 69 percent in 2016 to about 89 percent in 2025.
Now, global conflict and domestic politics have turned the tide back in Canada’s favor. The ongoing war involving Iran and the closure of the Strait of Hormuz created massive chaos in global energy markets. International oil companies now view Canada, the world’s fourth-largest oil producer, as a much safer bet for their money. They want to operate in a stable country that does not face the constant threat of war.
Political leadership in Canada also changed to support the industry. Prime Minister Mark Carney took office and adopted a much friendlier stance toward oil and gas development than his predecessor, Justin Trudeau. Carney promised to help the industry grow. He actively rolled back several strict climate rules to encourage new investments and make it easier for energy companies to do business.
The Shell deal provides the first concrete proof that foreign companies once again value Canadian resources. Shell plans to absorb ARC Resources. ARC is the largest natural gas producer operating solely in Canada’s Montney shale region. Mike Verney, an executive vice president at McDaniel & Associates in Calgary, said Shell’s massive purchase validates the world-class quality of Canadian energy resources.
A major draw for these foreign companies involves new export routes. Canada recently developed emerging liquefied natural gas export facilities right on the Pacific coast. These coastal terminals give companies direct shipping access to hungry markets in Asia. Last year, TotalEnergies bought a stake in the proposed Ksi Lisims LNG project on the northwest coast of British Columbia. If regulators approve it, the facility will become the second-largest export terminal in the country.
Shell also holds a massive stake in the region’s export future. The company and its partners began production at the LNG Canada facility last June. They expect to make a final decision very soon on whether they will advance the second phase of the massive project. These coastal projects need a steady supply of gas to keep running.
These export projects push investors to buy the upstream assets that actually supply the gas. They specifically look at the Montney region. This massive shale play spans across northeast British Columbia and northwest Alberta. Right now, domestic producers like ARC and Tourmaline Oil dominate the area. However, the region remains underdeveloped compared to major United States drilling sites. The Montney currently produces about 10 billion cubic feet of natural gas per day, which accounts for 50 percent of Canada’s total production. Meanwhile, the Permian Basin in the U.S. pumps out about 25 billion cubic feet of oil per day.
High crude oil prices give international companies the cash they need to buy these Canadian operators. But the list of available targets gets shorter with ARC Resources off the market. Experts point to Tourmaline Oil as the next logical target. Tourmaline currently stands as Canada’s largest natural gas producer and has a value of roughly $13.2 billion.
The company saw its shares stay flat over the past year. Since Tourmaline Chief Executive Mike Rose is 68 years old, a corporate sale could easily solve any future leadership succession questions. If the massive public companies refuse to sell, the foreign majors could target smaller operations instead. Many private equity-backed oil and gas producers operate across the Canadian shale regions. Energy giants might buy up several of these smaller firms to build a larger footprint in the country.
