Teekay LNG Partners L.P. Exercises Options for Two Additional LNG Newbuildings

Teekay LNG Partners L.P. Exercises Options for Two Additional LNG Newbuildings 
HAMILTON, BERMUDA -- (Marketwired) -- 07/26/13 -- Teekay LNG Partners
L.P. (Teekay LNG or the Partnership) (NYSE:TGP) today announced that
during the past week it has exercised two of its three existing
options with Daewoo Shipbuilding & Marine Engineering Co., Ltd.,
(DSME) of South Korea for the construction of two 173,400 cubic meter
liquefied natural gas (LNG) carrier newbuildings for delivery in
2016. These two newbuilding LNG carriers are in addition to the two
LNG carriers Teekay LNG ordered from DSME in December 2012, which
have since secured time-charter employment commencing upon delivery.
These newbuildings will also be constructed with the M-type,
Electronically Controlled, Gas Injection (MEGI) twin engines, which
are expected to be significantly more fuel-efficient and have lower
emission levels than other engines currently being utilized in LNG
shipping. The Partnership intends to secure long-term contract
employment for both vessels prior to their delivery in 2016. In
connection with the exercise of these two newbuilding options, the
Partnership secured further options from DSME which will enable it to
order up to five additional LNG carrier newbuildings in the future. 
The contract with DSME includes an installment payment schedule
similar to the two LNG carrier newbuildings ordered from DSME in
December 2012. The Partnership intends to initially finance the
installment payments during construction using a portion of its
existing liquidity, and expects to secure long-term debt financing
for the two newbuildings prior to their scheduled deliveries.   
"The delivery of these two additional vessels is timed to coincide
with the next wave of increased demand for LNG carriers which is
expected when a large number of new LNG export projects come
on-stream commencing from late-2015," commented Peter Evensen, Chief
Executive Officer of Teekay GP LLC. "Our recently announced charter
contracts with Cheniere Energy for the first two MEGI LNG carrier
newbuildings, ordered in December 2012, are a good example of the
contract opportunities available in the LNG shipping market and the
attractiveness of these vessels with the new fuel-efficient MEGI
engines. Given the strong fundamental outlook in LNG shipping,
combined with the optimized design of these vessels, we are confident
in our ability to secure fixed-rate charter contracts for these
additional two newbuildings, which will provide Teekay LNG with
further visible built-in growth. Furthermore, the new options we
secured to order up to five additional LNG carrier newbuildings
should provide the Partnership with a competitive advantage for the
various LNG projects we are pursuing."  
About Teekay LNG Partners L.P. 
Teekay LNG Partners L.P. is the world's third largest independent
owner and operator of LNG vessels, providing LNG, liquefied petroleum
gas (LPG) and crude oil marine transportation services primarily
under long-term, fixed-rate charter contracts with major energy and
utility companies through its interests in 31 LNG carriers (including
one LNG regasification unit and four newbuildings), 29 LPG/Multigas
carriers (including five chartered-in LPG carriers and eight
newbuildings) and 11 conventional tankers. The Partnership's
interests in these vessels ranges from 33 to 100 percent. Teekay LNG
Partners L.P. is a publicly-traded master limited partnership (MLP)
formed by Teekay Corporation (NYSE:TK) as part of its strategy to
expand its operations in the LNG and LPG shipping sectors.  
Teekay LNG Partners' common units trade on the New York Stock
Exchange under the symbol "TGP". 
This release contains forward-looking statements (as defined in
Section 21E of the Securities Exchange Act of 1934, as amended) which
reflect management's current views with respect to certain future
events and performance, including statements regarding: the timing
and certainty of completion of the Partnership's two additional LNG
carrier newbuildings; timing and certainty of entering into long-term
charter contracts and long-term financing for the two additional LNG
newbuildings; the higher fuel-efficiency and lower emissions levels
associated with the MEGI engines; the effect of the newbuildings on
the Partnership's fleet size and cash flows; the potential
competitive advantage to the Partnership related to bidding on LNG
projects as a result of securing the options to order up to an
additional five LNG carrier newbuildings; and the anticipated
increase in demand for LNG shipping commencing from late-2015 due to
new LNG export projects as well as potentially more exports of LNG
from the United States. The following factors are among those that
could cause actual results to differ materially from the
forward-looking statements, which involve risks and uncertainties,
and that should be considered in evaluating any such statement: less
than anticipated revenues or higher than anticipated costs or capital
requirements related to the newbuildings in which the Partnership has
agreed to construct; shipyard construction delays; increased cost to
construct the two additional LNG carriers; failure of the MEGI engine
to provide the expected efficiency and emission specifications;
failure by the Partnership to secure charter contracts and/or
financing prior to the delivery for the two additional LNG carrier
newbuildings; failure by the Partnership to secure new LNG projects
associated with the Partnership's options to order up to five
additional LNG carrier newbuildings; changes in production of LNG,
either generally or in particular regions that would impact the
expected future growth in the global LNG transportation and
regasification markets, and spot LNG shipping rates; changes in
trading patterns or timing of the start-up of new LNG liquefaction
projects significantly impacting overall LNG shipping requirements;
changes in applicable industry laws and regulations and the timing of
implementation of new laws and regulations; and other factors
discussed in Teekay LNG Partners' filings from time to time with the
SEC, including its Report on Form 20-F for the fiscal year ended
December 31, 2012. The Partnership expressly disclaims any obligation
to release publicly any updates or revisions to any forward-looking
statements contained herein to reflect any change in the
Partnership's expectations with respect thereto or any change in
events, conditions or circumstances on which any such statement is
Teekay LNG Partners L.P.
Kent Alekson
Investor Relations Enquiries
+ 1 (604) 609-6442
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