HAMILTON, BERMUDA — (Marketwired) — 05/29/13 — Teekay Offshore Partners L.P. (Teekay Offshore or the Partnership) (NYSE: TOO) today announced that it has agreed to acquire a 50 percent interest in the Cidade de Itajai (Itajai) floating production, storage and offloading (FPSO) unit from Teekay Corporation (Teekay) for a purchase price of approximately $204 million. The acquisition will be financed with assumed debt and proceeds from the recently completed equity private placement. The acquisition is expected to be completed on June 1, 2013, subject to customary closing conditions. The Itajai FPSO is operating on the Bauna and Piracaba (previously named Tiro and Sidon) fields in the Santos Basin offshore Brazil under a nine-year fixed-rate time-charter contract (plus extension options) with Petroleo Brasileiro SA (Petrobras). The remaining 50 percent interest in the Itajai FPSO is owned by Brazilian-based Odebrecht Oil & Gas S.A.
The Partnership–s 50 percent interest in the Itajai FPSO unit, which will be equity accounted for, is expected to generate annual Cash Flow from Vessel Operations(1) of approximately $25 million, and annual Distributable Cash Flow(2) of approximately $14 million.
“We are pleased to be completing another strategic FPSO acquisition, our second to-date in 2013, which will bring the Partnership–s total FPSO fleet size to five units,” commented Peter Evensen, Chief Executive Officer of Teekay Offshore GP LLC. “The Itajai FPSO will add to our growing FPSO franchise in Brazil, where we currently own and operate two other FPSO units, and further builds on our strong relationship with Petrobras. In addition, the stable fixed-rate cash flow contributed from the Itajai FPSO will be accretive to the Partnership–s distributable cash flow.”
The Board of Directors of the Partnership–s general partner and its Conflicts Committee have approved the transaction. The Conflicts Committee retained independent legal and financial advisors to assist in evaluating the transaction.
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 35 shuttle tankers (including four chartered-in vessels and three committed newbuildings), five floating production, storage and offloading (FPSO) units, seven floating storage and offtake (FSO) units (including two committed FSO conversions) and five conventional oil tankers. The majority of Teekay Offshore–s fleet is employed 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”.
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 timing, certainty and effect of the completion of the acquisition of a 50 percent interest in the Itajai FPSO unit, including the form of financing the acquisition; and the effect of the potential acquisition on the Partnership–s cash flow from vessel operations and distributable cash flow. 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 failure of the proposed acquisition to be completed; potential early termination of the contract between the Partnership and Petrobras and inability to replace this contract; greater than expected levels of operating expenses or less than expected oil production by the FPSO unit; 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.
Contacts:
Teekay Offshore Partners L.P.
Kent Alekson
Investor Relations Enquiries
+1 (604) 609-6442