A group led by Blackstone Inc.’s credit arm agreed to buy almost half of the vehicle that holds Mitsubishi Corp.’s interest in LNG Canada, the latest sign that big private lenders are willing to take long-dated positions in energy export infrastructure.
Funds managed by Blackstone Credit & Insurance, joined by four of Canada’s largest public pension investors, will acquire a 49.9% non-controlling interest in the Mitsubishi subsidiary that owns 15% of the British Columbia liquefied natural gas terminal, the companies said Monday. Blackstone put the investment at $3.1 billion. Mitsubishi, in its own statement, valued the transaction at about $1.6 billion, or roughly 250 billion yen. Neither company reconciled the two numbers.
Mitsubishi keeps control and the gas
The Japanese trading house will remain the controlling partner and keep all of the holding company’s share of the plant’s output, which it markets to buyers in Asia, mainly Japan, through a Singapore-based subsidiary. That offtake currently runs at about 2.1 million metric tons a year and is expected to double to roughly 4.2 million tons once a second phase of the project is built.
Mitsubishi said the sale is meant to improve the capital efficiency of its investment while giving it a partner with deep pockets to help pay for that expansion. Shell PLC and its partners took a final investment decision on LNG Canada’s Phase 2 in late September. The expansion would double the facility’s capacity to about 28 million tons a year, putting it among the largest LNG plants in the world. The first phase started production in mid-2025, making LNG Canada the country’s first large-scale export terminal.
Pensions pile in
The investor group includes CPP Investments, the Ontario Municipal Employees Retirement System, the Investment Management Corp. of Ontario and the Public Sector Pension Investment Board. Blackstone’s infrastructure and asset-based credit business, which manages about $140 billion, has struck a string of similar structured investments with large companies in recent years, including deals tied to Rogers Communications, Sempra’s Port Arthur LNG project and joint ventures with EQT Corp. and Williams Cos.
The structure lets an industrial owner raise money against a prized asset without giving up operating control or customer relationships, while the investors gain a stake in contracted, long-life cash flows. A Mitsubishi spokesperson said the deal is expected to close in November. Goldman Sachs was lead structuring agent and financial adviser to Blackstone, with Scotiabank also advising. RBC Capital Markets advised Mitsubishi.
