Relatively cheap natural gas feedstock and a stronger political environment.

It’s clear many factors — including these two considerations — played a part in Shell making one of the largest acquisitions in Canadian oilpatch history with its $22-billion purchase of ARC Resources this week.

The deal could improve the likelihood of Phase 2 of the LNG Canada project moving forward, but it’s also a positive indication for the country’s hard-hit gas sector, which has endured years of low prices.

“What it means is the reversal of the decades-long exodus of foreign capital from Canada — at a scale that we’ve never seen before in the upstream business, which is a huge shot in the arm for the industry,” Michael Belenkie, chief executive of gas producer Advantage Energy, said Tuesday.

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Hue Tran, vice-president of business development and marketing at gas producer Birchcliff Energy, said the transaction delivers a message about the future of the natural gas industry in the country.

“There were (previous) concerns about the regulatory process and then the appetite for investment in our basin. And the fact that you have a large player now taking an interest, I think it opens the door for more of that, and more investment,” he said.

“You have a large player now signalling that they have a positive view on the Canadian gas story.”

Shell announced Monday it struck a friendly agreement to acquire Calgary-based ARC Resources in a cash-and-stock deal.

On Tuesday, Shell CEO Wael Sawan told analysts the supermajor had been........

© Calgary Herald