Teekay LNG Partners Announces Acquisition and Charter Back of Second LNG Carrier Newbuilding

Teekay LNG Partners Announces Acquisition and Charter Back of Second LNG 
Carrier Newbuilding 
HAMILTON, BERMUDA -- (Marketwired) -- 09/24/13 -- Teekay LNG Partners
L.P. (Teekay LNG or the Partnership) (NYSE:TGP) today announced that
it has agreed to acquire a second 155,900 cubic meter liquefied
natural gas (LNG) carrier newbuilding from Awilco LNG ASA (Awilco)
(ALNG:NO), a Norway-based owner and operator of LNG carriers. The
vessel, the second of two vessels to be acquired by the Partnership
from Awilco, is currently under construction by Daewoo Shipbuilding &
Marine Engineering Co., Ltd. (DSME) of South Korea and is expected to
deliver in the fourth quarter of 2013. Subsequent to delivery from
DSME to Awilco, Teekay LNG will purchase the vessel and bareboat
charter it back to Awilco at a fixed-rate for a firm period of four
years, plus a one-year extension option.  
As with the first vessel, Teekay LNG will purchase the second vessel
for a price of $205 million less a $50 million upfront prepayment of
charter hire by Awilco which is in addition to the daily bareboat
charter rate. Awilco has fixed-price purchase obligations for both
vessels at the end of both the firm charter period and option period.
The Awilco vessels, the first of which was delivered on September 16,
2013, are each expected to generate annual Distributable Cash Flow(1)
of approximately $7.5 million. 
The Partnership intends to initially finance the second vessel with a
portion of its existing liquidity and expects to secure long-term
debt financing prior to delivery.  
"Further to our August 2013 announcement on the first Awilco LNG
carrier newbuilding, the acquisition-leaseback of a second vessel
from Awilco will provide Teekay LNG with additional near-term
accretive cash flows," commented Peter Evensen, Chief Executive
Officer of Teekay GP LLC. "These vessels will complement the
Partnership's strong portfolio of longer-term visible growth
projects, including, the four LNG carrier newbuildings delivering in
2016 and the ten LPG newbuildings in our joint venture with Exmar,
delivering between 2014 and 2017."  
The acquisition of the second Awilco vessel, which is expected to
close during the fourth quarter of 2013, has been approved by Board
of Directors of both Teekay LNG and Awilco, and remains subject to
customary closing conditions, including satisfactory documentation.  

1.  Distributable cash flow represents net income adjusted for depreciation
    and amortization expense, non-controlling interest, non-cash items,
    distributions relating to equity financing of newbuilding installments,
    vessel acquisition costs, estimated maintenance capital expenditures,
    unrealized gains and losses from derivatives, non-cash income taxes and
    unrealized foreign exchange related items. Maintenance capital
    expenditures represent those capital expenditures required to maintain
    over the long-term the operating capacity of, or the revenue generated
    by, the Partnership's capital assets. Distributable cash flow is a
    quantitative standard used in the publicly-traded partnership investment
    community to assist in evaluating a partnership's ability to make
    quarterly cash distributions. Distributable cash flow is not defined by
    United States generally accepted accounting principles (GAAP) and should
    not be considered as an alternative to net income or any other indicator
    of the Partnership's performance required by GAAP.

About Teekay LNG Partners L.P. 
Teekay LNG Partners L.P. is the world's second largest independent
owner and operator of LNG carriers, providing LNG, liquefied
petroleum gas (LPG) and crude oil marine transportation services
primarily under long-term, fixed-rate charter contracts through its
interests in 32 LNG carriers (including one LNG regasification unit
and four newbuildings), 31 LPG/Multigas carriers (including five
chartered-in LPG carriers and 10 newbuildings) and 11 conventional
tankers. The Partnership has also agreed to acquire one additional
LNG carrier newbuilding, subject to closing conditions. The
Partnership's interests in all of these vessels range 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
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 acquisition of a second
newbuilding LNG carrier from Awilco, including the completion of
customary closing conditions; the Partnership's intention to
initially finance the second Awilco vessel with a portion of its
existing liquidity and the timing and certainty of the Partnership
securing long-term debt financing for this vessel; and the timing and
certainty of delivery of the Partnership's remaining committed LNG
and LPG newbuildings. 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:
shipyard construction delays; failure by the Partnership to secure
long-term financing for the Awilco vessels; the potential early
termination of the bareboat charter contract with Awilco; failure to
satisfy closing conditions of the transaction; 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 global 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
Press spacebar to pause and continue. Press esc to stop.