Trinidad’s Atlantic LNG Restructuring Boosts BP’s Stake, Lowers Shell’s (NYSE:SHEL)

In a restructuring deal that’s to be finalized this week, Reuters reported that Shell’s (NYSE:SHEL) ownership in Trinidad and Tobago’s Atlantic LNG project would decrease. At the same time, BP (NYSE:BP) and Trinidad’s state-owned National Gas Co (NGC) will increase their holdings.

Notably, the new deal would end five years of negotiations and clear the way for Latin America’s biggest LNG export plant to resume full production. As noted in the report, the Trinidad and Tobago government expects to generate more revenue based on the new arrangement.

Currently, Shell and BP hold 54% and 40% stakes in Atlantic LNG’s trains 2, 3, and 4. Meanwhile, NGC has an 11.1% share in train 4 but doesn’t own any part of trains 2 and 3.

According to the report, the new agreement streamlines the project’s ownership structure into ownership across all four trains, thereby reducing Shell’s stake to 45% and raising BP’s stake to 45% while giving NGC 10%. Additionally, Chinese Investment Co., which had owned approximately 10% of Train 1, would no longer hold any shares in Atlantic LNG.

The Atlantic facility remains crucial to Shell and BP’s LNG portfolio. In 2022, production from the facility accounted for 15% of Shell’s global production. For BP, it was 18% of all its global output. 

Both BP and Shell shares traded lower in Monday’s trading session. 

Which Stock is Better, BP or Shell?

Turning to Wall Street, BP stock remains the leader in upside potential here. This Moderate Buy-rated stock offers 29.77% against its average price target of $46.07. Meanwhile, with an average price target of $72.63, SHEL stock is the laggard, as this Moderate Buy-rated stock offers investors 12.21% upside potential. 

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