Teekay To Buy LNG Carrier From Awilco - Quick Facts

(RTTNews) - Teekay LNG Partners L.P. (TGP) Monday said it has agreed to acquire a 155,900 cubic meter liquefied natural gas carrier newbuilding from Awilco LNG ASA, a Norwegian-based owner and operator of LNG carriers.

The vessel, which is currently under construction by Daewoo Shipbuilding & Marine Engineering Co., Ltd., of South Korea, is expected to deliver in the third quarter.

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 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 before delivery.