Norwegian-based pure play LNG transportation company Awilco LNG has extended charter contracts for two LNG carriers owned by Teekay LNG Partners to December 2019.
The contracts, relating to the Wilpride and Wilforce LNG carriers, were previously set to expire in the fourth quarter of 2017 and the second quarter of 2018.
Awilco LNG remains obligated to repurchase the vessels either during or at the end of the charter period, Teekay LNG said.
Additionally, as part of this extension, Teekay agreed to defer charter hire payments of an average of USD 15,600 per day per vessel commencing in July 2017 through the end of the charter period, with such deferred amounts added to the purchase obligation price.
The deal has enabled Teekay LNG to push the loan facilities associated with these vessels to June 2020, which were previously scheduled to mature in 2018. The debt amounts to approximately USD 180 million.
Teekay announced the contract extension on the back of a reported GAAP net loss of USD 16.1 million and adjusted net income of USD 17.9 million in the second quarter of 2017, down from corresponding USD 43 million in income reported a year earlier.
“During the second quarter, the Partnership continued to generate stable cash flows supported by a diversified portfolio of long-term charters totaling USD 11.4 billion in forward fixed-rate revenues with a weighted-average remaining contract duration of 13 years,” commented Mark Kremin, President and CEO of Teekay Gas Group Ltd.
“Since reporting earnings in May 2017, we continued to execute on our portfolio of committed growth projects,” Kremin continued.
“Last week, our Exmar LPG joint venture took delivery of a mid-size LPG carrier newbuilding, the Kruibeke, and during the quarter, our first joint venture LNG carrier chartered to Shell, the Pan Asia, successfully completed sea trials and is expected to deliver in the fourth quarter of 2017 at which time it will commence its 20-year charter contract. In addition, we continue to progress the financing for all our committed growth projects delivering through early-2020.”
In July 2017, the Teekay LNG-Marubeni Joint Venture secured short-term charter contracts on two vessels, the Magellan Spirit and the Awra Spirit. The Magellan Spirit commenced a six-month contract (plus two three-month option periods) in July 2017 and the Awra Spirit will commence a 15-month charter contract in the fourth quarter of 2017
As at June 30, 2017, the Partnership had total liquidity of approximately USD 350 million.