Teekay LNG Partners Announces Acquisition and Charter Back for Up to Two LNG Carrier Newbuildings
August 05 2013 - 3:04AM
HAMILTON, BERMUDA--(Marketwired - August 5, 2013)
- Teekay LNG Partners L.P. (Teekay LNG or
the Partnership) (NYSE:TGP) today announced
that it has agreed to acquire a 155,900 cubic meter (cbm) liquefied natural gas (LNG) carrier newbuilding from Awilco LNG ASA
(Awilco) (ALNG:NO), a Norwegian-based owner
and operator of LNG carriers. The vessel, which is currently under
construction by Daewoo Shipbuilding & Marine Engineering Co.,
Ltd., (DSME) of South Korea, is expected to
deliver in the third quarter of 2013, and subsequent to delivery
from DSME to Awilco, Teekay LNG will purchase the vessel and
bareboat charter the vessel back to Awilco at a fixed rate for a
firm period of five years, plus a one-year extension option. Teekay
LNG will purchase the 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 at the end of both the firm charter period and
option period.
As part of the transaction, Awilco has an option
to sell to and bareboat charter back from Teekay LNG a second
155,900 cbm LNG carrier newbuilding currently under construction by
DSME, under similar terms. The second LNG carrier newbuilding is
expected to deliver in the fourth quarter of 2013.
The Partnership intends to finance the transaction
with a portion of its existing liquidity and expects to secure
long-term debt financing prior to delivery.
"We are pleased to announce this mutually
beneficial acquisition-leaseback arrangement with Awilco which will
provide Teekay LNG with immediate accretive cash flow," commented
Peter Evensen, Chief Executive Officer of Teekay GP LLC. "Together
with our four LNG carrier newbuildings delivering in 2016 and the
ten LPG newbuildings in our joint venture with Exmar, delivering
between 2014 and 2017, this transaction with Awilco provides a
near-term compliment to the Partnership's strong portfolio of
long-term visible growth projects."
The transaction, which is expected to close during
the third 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.
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), 31 LPG/Multigas
carriers (including five chartered-in LPG carriers and ten
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".
FORWARD
LOOKING STATEMENTS
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 acquisition of
a newbuilding LNG carrier from Awilco, including the completion of
customary closing conditions; the timing and certainty of Teekay
LNG acquiring a second LNG carrier newbuilding under similar terms
to the first vessel; the timing and certainty of Teekay LNG
securing long-term financing for the acquired vessel, or vessels;
and the timing and effect of the transaction with Awilco, as well
as other committed LNG and LPG newbuildings, will have on the
Partnership's cash flows. 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; the potential early termination of the
bareboat charter contracts with Awilco; failure to secure long-term
charters for the acquired vessels; 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 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 based.
Contact
Information
For Teekay LNG
Kent Alekson
Investor Relations enquiries
1 (604) 609-6442
www.teekaylng.com
This
announcement is distributed by Thomson Reuters on behalf of Thomson
Reuters clients.
The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the
information contained therein.
Source: Teekay LNG Partners L.P. via Thomson Reuters
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