Teekay Offshore Partners L.P.

Teekay Offshore Partners L.P.

April 18, 2013 09:09 ET

Teekay Offshore Announces Distribution Increase and Provides 2013 Distribution Guidance; Receives Offer to Acquire 50% Interest in Itajai FPSO

HAMILTON, BERMUDA--(Marketwired - April 18, 2013) - Teekay Offshore Partners (Teekay Offshore or the Partnership) (NYSE:TOO) today announced that the Board of Directors of its general partner, Teekay Offshore GP LLC, has approved an increase to the Partnership's first quarter of 2013 cash distribution to be paid on May 14, 2013, to all unitholders of record on April 30, 2013. Teekay Offshore will increase its first quarter distribution by $0.0128 per unit, or approximately 2.5 percent, to $0.5253 per unit, and management intends to recommend to the Board of Directors an additional distribution increase of a minimum of 2.5 percent later this year.

The increase to the first quarter distribution coincides with the expected completion of the previously announced acquisition of the Voyageur Spirit FPSO unit which began production on April 13, 2013. Teekay Offshore will now recognize the results from the Voyageur Spirit acquisition in the second quarter of 2013, commencing from the acquisition date which is expected to occur before the end of April 2013.

In addition, Teekay Offshore today announced that it has received an offer from Teekay Corporation (Teekay) to acquire its 50 percent interest in the Cidade de Itajai (Itajai) FPSO unit at Teekay's fully built-up cost. The Itajai FPSO has been operating on the Baúna and Piracaba (previously named Tiro and Sidon) fields in the Santos Basin offshore Brazil since February 2013 under a nine-year time-charter contract (plus extension options) with Petroleo Brasileiro SA (Petrobras). The offer is currently being reviewed by the Board of Directors of the Partnership's general partner and its Conflicts Committee. The remaining 50 percent interest in the Itajai FPSO is owned by Brazilian-based Odebrecht Oil & Gas.

"We are pleased that the accretive acquisition of the Voyageur Spirit FPSO, our largest FPSO purchase to-date, will soon be completed and we are once again in a position to increase the Partnership's distribution," commented Peter Evensen, Chief Executive Officer of Teekay Offshore GP LLC. "Looking forward, with multiple near-term growth opportunities, including four newbuilding shuttle tankers delivering in 2013 onto 10-year contracts with the BG Group, and multiple FPSO assets potentially available in the future for purchase from our sponsor, Teekay Corporation, we believe we are well-positioned to continue increasing our distributions through accretive acquisitions."

About Teekay Offshore Partners L.P.

Teekay Offshore Partners L.P. is an international provider of marine transportation, oil production and storage services to the offshore oil industry focusing on the fast-growing, deepwater offshore oil regions of the North Sea and Brazil. Teekay Offshore is structured as a publicly-traded master limited partnership and owns interests in 37 shuttle tankers (including four chartered-in vessels and four committed newbuildings), four floating production, storage and offloading (FPSO) units, five floating storage and offtake (FSO) units and six conventional oil tankers. The majority of Teekay Offshore's fleet trades on long-term, stable contracts. In addition, Teekay Offshore has rights to participate in certain other FPSO and shuttle tanker opportunities provided by Teekay Corporation (NYSE:TK) and Sevan Marine ASA (Oslo Bors:SEVAN).

Teekay Offshore's common units trade on the New York Stock Exchange under the symbol "TOO".


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 amount and timing of potential future distribution increases per common unit; the timing and the certainty of the Partnership's acquisition of the Voyageur Spirit FPSO unit; the effect of the Voyageur Spirit FPSO acquisition and delivery of four shuttle tanker newbuildings on the Partnership's future distributable cash flow; the timing and certainty of the Partnership's potential acquisition of Teekay's 50 percent interest in the Itajai FPSO and the impact on the Partnership's future distributable cash flow; and the potential for additional asset acquisitions. 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: vessel operations and oil production volumes; significant changes in oil prices; variations in expected levels of field maintenance; increased operating expenses; different-than-expected levels of oil production in the North Sea and Brazil offshore fields; potential early termination of contracts; potential delays in the delivery of the four newbuilding shuttle tankers and commencement of their respective time-charter contracts with the BG Group; failure or delay of the completion of the Partnership's acquisition of the Voyageur Spirit FPSO unit; failure to obtain required approvals by the Conflicts Committee of Teekay Offshore's general partner to acquire vessels offered by Teekay, including the Itajai, or third parties; the Partnership's ability to raise adequate financing to purchase additional assets; and other factors discussed in Teekay Offshore's 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 or undertaking 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.

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