LONDON, July 15, 2026, 10:44 (BST)
- ARC investors approved the $16.4 billion buyout by Shell, with 99.54% of votes in favor. A court hearing in Alberta is set for Wednesday.
- Shell plans to issue 228 million shares, or about 4.1% of its June total. ARC’s production would boost the output base by roughly 13.4%, based on figures from the time the deal was announced.
Shell Plc LON:SHEL is on track to boost daily production by around 13.4% with a 4.1% gross increase in its ordinary shares after ARC Resources Ltd TSE:ARX shareholders OK’d the deal. Based on Shell’s June share count, production per 1,000 shares will go up roughly 8.9% before any extra buybacks.
Margin is key here. ARC said 99.54% of votes backed the deal. It already has competition and transport sign-off in Canada and the U.S. The Court of King’s Bench of Alberta was set for a hearing on the approval at 10 a.m. Mountain Time Wednesday. Closing is still on track for the second half of 2026.
With the shareholder vote done, investors are now focused on how fast Shell can turn the acquired barrels into cash per share. Shell’s London shares traded 0.45% higher at 3,161 pence in late morning trade at 10:21 BST. A spokesperson said share buybacks paused around the vote “will be made up in the remainder of 2026”, pending board signoff. AJ Bell
| Share-count comparison | Shares | Effect |
|---|---|---|
| Shell ordinary shares as of June 30 | 5.571 billion | Base |
| ARC holders get new shares | 228.0 million | +4.1% |
| Total shares after deal closes | 5.799 billion | +4.1% on base |
| Bought between May 7 and June 11 before halt | 32.6 million | 14.3% of ARC shares |
The June share count already includes the 32.6 million shares Shell bought back. The numbers are based on Shell’s own capital disclosure, the deal details, and transaction history data.
Shell’s line-item file shows the buyback picked up 32.63 million shares for around £1.04 billion before it hit pause, at an average 3,189 pence. That’s 14.3% of the shares set for ARC holders. Shell can’t count those buys again in the June numbers, but any delayed buybacks can still trim the eventual rise.
ARC posted 374,000 boe/d in 2025, with boe/d counting both oil and gas. Shell said the deal would bring in about $1.5 billion a year in FCF, or free cash flow, which is cash left after capex.
| Operating comparison | Before deal | After deal or deal input | Change or ratio |
|---|---|---|---|
| Daily production | Roughly 2.800 million boe/d | Roughly 3.174 million boe/d | +13.4% |
| Production per 1,000 ordinary shares | 0.503 boe/d | 0.547 boe/d | +8.9% |
| Proved plus probable reserves | 8.1 billion boe | Roughly 10.1 billion boe | +24.7% |
| Enterprise value / expected annual FCF | — | $16.4 billion / $1.5 billion | 10.9x EV/FCF, 9.1% FCF yield |
*Reserve figures are arithmetic only. ARC and Shell calculate reserves under different standards, and Shell says that can lead to material differences. All amounts in U.S. dollars.
Excluding the future buyback, Shell’s production jumps to around 0.547 boe/d per 1,000 shares from 0.503. That gives the company an 8.9% operating buffer versus its share count. Still, production isn’t the same as cash.
Shell is projecting double-digit returns, free cash flow per share accretion from 2027, and says it will reach about $250 million in annualised savings within a year after closing. Based on the stated enterprise value, Shell’s forecast for a $1.5 billion contribution lines up as a multiple of nearly 10.9 times, not counting those savings. CEO Wael Sawan said he was “very comfortable” with what this means for Shell’s financial setup. Shell
ARC’s production isn’t all about gas. About 60% of volumes are gas, but its liquid output—about 40%—made up nearly 70% of projected 2025 revenue. Shell will put the unit in Integrated Gas, where it recently raised Q2 production guidance to 610,000–650,000 boe/d and said trading would come in much higher than Q1. Sawan has called Canada “a heartland for Shell”. Reuters
The math could still change. The deal needs court sign-off and some regulatory clearance, and the planned buybacks need the board’s OK. The $1.5 billion FCF projection hinges on commodity moves, drilling, and how the integration goes. The reserve numbers are just for reference—ARC uses Canada’s NI 51-101, Shell follows SEC counts, and Shell says that gap can be big.
Shell is set to report Q2 results on July 30. Investors will watch if better gas trading and a forecast working-capital boost leave management space to make up the buyback while keeping the balance sheet intact. The deal cleared the shareholder vote, so cash conversion comes next.
Related articles: LON:SHEL
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