|By Marketwired .||
|July 9, 2014 06:32 PM EDT||
HAMILTON, BERMUDA -- (Marketwired) -- 07/09/14 -- Teekay LNG Partners L.P. (Teekay LNG or the Partnership) (NYSE: TGP), through a new 50/50 joint venture with China LNG Shipping (Holdings) Limited (China LNG), today announced that it has finalized shipbuilding contracts for six internationally-flagged icebreaker liquefied natural gas (LNG) carriers for the Yamal LNG Project, which is located on the Yamal Peninsula in Northern Russia.
Under the agreements, the joint venture between Teekay LNG and China LNG will build six 172,000 cubic meter ARC7 LNG carrier newbuildings to be constructed by Daewoo Shipbuilding & Marine Engineering Co., Ltd., of South Korea, for a total fully built-up cost of approximately $2.1 billion. The vessels will be constructed with maximum 2.1 meter icebreaking capabilities in both the forward and reverse direction.
Yamal LNG, a joint venture between Russia-based Novatek (60 percent), France-based Total (20 percent) and China-based China National Petroleum Corporation (CNPC) (20 percent), will consist of three LNG trains with a total expected capacity of 16.5 million metric tons of LNG per annum and is currently scheduled to start-up in early-2018.
"We are pleased to finalize this previously announced accretive transaction, which solidifies Teekay LNG's role in Yamal LNG, a strategic international energy project sponsored by Novatek, Total and CNPC, and further expands our partnership with China LNG," commented Peter Evensen, Chief Executive Officer of Teekay GP LLC. "These six newbuildings will both increase and extend the average duration of Teekay LNG's existing fixed-rate contact portfolio, providing further long-term stability for the Partnership's cash flows. These vessels also add to Teekay LNG's existing pipeline of growth projects scheduled to deliver between now and 2020, which includes our five MEGI LNG carrier newbuildings, 10 LPG carrier newbuildings ordered through our Exmar LPG joint venture, and our ownership interest in four LNG carrier newbuildings that will be chartered to BG Group."
The signing by the owner of the remaining newbuilding carriers required for the Yamal LNG Project will take place in Russia.
About Teekay LNG Partners L.P.
Teekay LNG Partners is one of the world's largest independent owner and operator of LNG carriers, providing LNG, LPG and crude oil marine transportation services primarily under long-term, fixed-rate charter contracts through its interests in 50 LNG carriers (including one LNG regasification unit and 15 newbuildings), 31 LPG/Multigas carriers (including five chartered-in LPG carriers and 10 newbuildings) and nine conventional tankers. The Partnership's interests in these vessels range from 20 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".
About China LNG Shipping (Holdings) Ltd.
China LNG Shipping (Holdings) Limited, a private China-based LNG shipping company, was founded jointly by Dalian Ocean Shipping Company and China Merchant Energy Shipping LNG Carrier Investment Inc. China LNG is currently the only LNG shipping company that owns and operates LNG carriers in China. Its businesses cover LNG carrier asset investment and management, LNG shipping, LNG shipping management and consultancy services for LNG shipping investments.
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 impact of the Yamal LNG transaction on the Partnership's future cash flows and the size and average duration of its fixed-rate contract portfolio; the cost to construct the six LNG carrier newbuildings; the timing of the start-up of the Yamal LNG project and the expected total LNG production capacity of the project, if completed; the timing and location for signing the shipyard contracts for the remaining newbuilding carriers; and the expected delivery dates of the Partnership's existing LNG and LPG newbuilding vessels. 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: potential shipyard construction delays, newbuilding specification changes or cost overruns; potential early termination of the time-charter contracts for the six LNG carrier newbuildings by Yamal LNG; 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, including the status of other new LNG liquefaction projects; potential failure of the Yamal LNG Project to be completed for any reason, including due to lack of funding as a result of existing or future sanctions against Russian entities and individuals, which may affect partners in the project; potential delays of the Yamal LNG project; the inability of the Partnership to secure long-term debt financing for the six LNG carrier newbuildings; 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, 2013. 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.
Teekay LNG Investor Relations Enquiries
+ 1 (604) 609-6442