Teekay LNG Secures Cash for MEGI Newbuild Duo

Image Courtesy: TeekayImage Courtesy: Teekay

Teekay LNG has secured a 10-year, USD 360 million long-term lease facility, which will be used to finance the company’s two MEGI LNG carrier newbuildings.

During the fourth quarter of 2015, Teekay LNG’s first MEGI LNG carrier newbuilding completed sea trials with the second vessel scheduled to commence sea trials late in the first quarter of 2016.

These vessels will commence their respective five-year fee-based contracts with Cheniere Energy late in the first quarter and third quarter of 2016 and are expected to earn annual cash flow from vessel operations and distributable cash flow of approximately USD 50 million and USD 30 million, respectively.

During the fourth quarter of 2015, the Partnership generated distributable cash flow of USD 61.5 million, compared to USD 69 million the same period of the prior year. The decrease in distributable cash flow was primarily due to the termination of the charter contract for the Partnership’s 52 percent-owned Magellan Spirit LNG carrier in March 2015, and lower capitalized distributions relating to equity financing of newbuildings.

Teekay LNG owns two 52 percent-owned LNG carriers, the Marib Spirit and Arwa Spirit, through its joint venture with Marubeni Corporation that are currently on long-term charters expiring in 2029 to the Yemen LNG project (YLNG), a consortium led by Total SA.

The company said that due to the political situation in Yemen, YLNG decided to temporarily close down the LNG plant in 2015. As a result of a possible extended plant closing, the Partnership’s joint venture agreed to a temporary deferral of a significant portion of the charter payments for the two LNG carriers during 2016. Upon future resumption of the LNG plant in Yemen, it is expected that YLNG will repay the deferred amounts in full over a period of time to be agreed upon.

“Teekay LNG continues to operate with high fleet utilization generating stable cash flows, supported by a large and well-diversified portfolio of fee-based contracts with high quality counterparties,”  says Peter Evensen, Chief Executive Officer of Teekay GP LLC.

“The decision in December to temporarily reduce Teekay LNG’s distributions was a difficult decision and was caused by the inability to access competitively priced capital in the current negative capital market environment and was not caused by a shortfall in the cash flows of our operations,” Evensen continued.

According to him, looking ahead to 2016, the company remains focused on executing on the Partnership’s portfolio of profitable growth projects, ensuring they remain on time and on budget and securing long-term financing for these projects.

Share this article

Follow World Maritime News

In Depth>


<< Oct 2016 >>
26 27 28 29 30 1 2
3 4 5 6 7 8 9
10 11 12 13 14 15 16
17 18 19 20 21 22 23
24 25 26 27 28 29 30
31 1 2 3 4 5 6

Danish Maritime Technology Conference 2016

A part of Danish Maritime Days 

For the first half of 2016, the key buzzword of the maritime industry have been ‘The Fourth Industrial Revolution’. The global maritime industry stands in the midst of a market with changing dynamics, where emerging technologies give endless possibilities with an unprecedented processing power.

The emerging technologies have opened up for new products and services that increase efficiency through the entire maritime value chain. The Danish Maritime Technology Conference looks at the key drivers emerging in and from the Fourth Industrial Revolution – the technologies, the products and the services that leads this market change.

The new waves of accelerating technological development require new forms of conducting agile business, given the speed at which innovation and disruption takes place. Members of Danish Maritime are global market leaders within the maritime industry, and together with specialists they will discuss their core challenges and present their solutions to a game changing market.

More info

read more >

Danish Maritime Days 2016

At this year’s Danish Maritime Days, four themes will highlight some of the most important challenges and opportunities which the global…

read more >

Maritime Standard Tanker Conference

The event will highlight the main regional trends in crude, chemical and product tanker operations, giving attendees a unique insight into…

read more >


SHIPTEC CHINA builds up itself into a more outstanding, influential and well-reputed maritime event in northern China…

read more >