Teekay LNG Partners Reports Third Quarter 2019 Results

Highlights

• GAAP net income attributable to the partners and preferred unitholders of $47.4 million and GAAP net income per common unit of $0.51.
• Adjusted net income⁽¹⁾ attributable to the partners and preferred unitholders of $50.5 million and adjusted net income per common unit of $0.55 (excluding items listed in Appendix A to this release).
• Total Adjusted EBITDA⁽¹⁾ of $180.2 million.
• Took delivery of fourth and fifth, 50 percent-owned ARC7 LNG carrier newbuildings in August 2019 and early-November 2019, respectively; final ARC7 newbuilding expected to deliver in late-November 2019.
• Bahrain LNG Regasification terminal expected to commence operations before year-end.
• Fiscal 2019 earnings guidance range revised upwards by 10 percent⁽²⁾ and today introducing 2020 guidance with earnings per unit projected to increase by over 55 percent⁽²⁾ from 2019 guidance.
• Expect distributions to increase by 32 percent, to $1.00 per common unit per annum, commencing with the first quarter of 2020 distribution, a second consecutive year of distribution growth in excess of 30 percent.

HAMILTON, Bermuda, Nov. 13, 2019 (GLOBE NEWSWIRE) -- Teekay GP L.L.C., the general partner of Teekay LNG Partners L.P. (Teekay LNG or the Partnership) TGP, today reported the Partnership's results for the quarter ended September 30, 2019.

Consolidated Financial Summary

(1)  These are non-GAAP financial measures. Please refer to "Definitions and Non-GAAP Financial Measures" and the Appendices to this release for definitions of these terms and reconciliations of these non-GAAP financial measures as used in this release to the most directly comparable financial measures under United States generally accepted accounting principles (GAAP).

(2)  Based on midpoint of 2020 and 2019 guidance ranges.

Third Quarter of 2019 Compared to Third Quarter of 2018

GAAP net income and non-GAAP adjusted net income attributable to the partners and preferred unitholders for the three months ended September 30, 2019, compared to the same quarter in the prior year, were positively impacted by: earnings from the nine liquefied natural gas (LNG) carrier newbuildings which delivered into the Partnership's consolidated fleet and equity-accounted joint ventures between July 2018 and August 2019; higher earnings from the Torben Spirit upon redeployment at a higher charter rate that commenced in December 2018; higher earnings from the Magellan Spirit, which was chartered-in from the Partnership's 52 percent-owned joint venture with Marubeni Corporation (the MALT Joint Venture) commencing in September 2018; higher earnings in the MALT Joint Venture from the commencements of the Arwa Spirit and Marib Spirit one-year charter contracts at higher rates in June and July 2019, respectively, and recognition of drydock hire revenue for the Meridian Spirit; and higher earnings from the Partnership's seven multi-gas carriers. These increases were partially offset by lower earnings due to more off-hire days for scheduled dry dockings and repairs during the third quarter of 2019 for certain of the Partnership's LNG carriers compared to the same quarter of the prior year.

In addition, GAAP net income attributable to the partners and preferred unitholders was negatively impacted in the three months ended September 30, 2019, compared to the same quarter of the prior year, by various items, including  unrealized losses on non-designated derivative instruments in the third quarter of 2019 compared to gains on non-designated derivative instruments in the third quarter of 2018, partially offset by a decrease in the write-down of vessels.

CEO Commentary

"During the third quarter of 2019, Teekay LNG recorded its highest ever quarterly results with adjusted earnings per common unit up almost 3.5x from the same period of the previous year," commented Mark Kremin, President and Chief Executive Officer of Teekay Gas Group Ltd. "We expect Teekay LNG's results will continue to increase, as reflected in our increased and tightened 2019 guidance range and a new, higher 2020 guidance range issued today. Based on this foundation of earnings growth expected in 2020, we intend to increase our distributions by 32 percent to $1.00 per common unit per annum, starting with our first quarter of 2020 distribution payable in May 2020."  Mr. Kremin continued, "I am also pleased to report that with the recent sale of our last conventional tanker, Teekay LNG is now 100 percent focused on our core business of transporting LNG and LPG."

"We are currently in the process of completing the last of our recent phase of growth projects," commented Mr. Kremin. "We have made good progress and anticipate the start-up of the Bahrain regasification terminal before the end of the year. In August and early-November 2019, we delivered our fourth and fifth ARC7 ice-breaking LNG carriers for the Yamal LNG project, which immediately commenced their respective long-term charter contracts. We expect the sixth ARC7 to deliver and commence its long-term charter contract with Yamal in late-November 2019, which will mark the successful completion of the $3.5 billion growth program we commenced in 2013. With nearly all of our current growth projects delivered and generating cash flows under long-term contracts, we are moving from a phase of project execution to a period of significant cash flow generation, which we believe will enable the Partnership to allocate capital towards balance sheet delevering and returning capital to unitholders."

Revising 2019 Guidance Higher and Introducing 2020 Guidance

Today, the Partnership is providing the below supplementary information relating to the outlook for the Partnership's estimated fiscal 2019 results, which have been revised higher, and is introducing estimated fiscal 2020 results, the majority of which are expected to be significantly higher than estimated fiscal 2019 results primarily due to newbuilding deliveries and higher charter rates earned from the vessels trading on short-term contracts:

(1)  These are non-GAAP financial measures. Please refer to "Definitions and Non-GAAP Financial Measures" and the Appendices to this release for definitions of these terms and reconciliations of these non-GAAP financial measures as used in this release to the most directly comparable financial measures under GAAP. Each of these non-GAAP financial measures excludes approximately $31 million of previously deferred revenue the Partnership expects to receive upon the sale of the WilForce and WilPride LNG carriers in late-2019 or early-2020.

(2)  All estimates are as of the date hereof, are approximations, are based on current information (including the number of outstanding common units). Actual results may differ materially from these estimates, and the Partnership expressly disclaims any obligation to release publicly any updates or revisions to any such estimates, including to reflect any change in the Partnership's expectations with respect thereto or any change in events, conditions or circumstances on which any such estimates are based.

(3)  Based on midpoint of 2020 and 2019 guidance ranges.

Summary of Recent Events

In December 2018, the Board of Teekay LNG's general partner approved a $100 million unit repurchase program. Since that time, the Partnership has repurchased a total of 2.26 million common units, or approximately 2.8 percent of the outstanding common units immediately prior to commencement of the program, for a total cost of $28.9 million, representing an average repurchase price of $12.78 per unit.  Since early-August 2019, Teekay LNG repurchased 816,672 units at an average price of $14.33 per unit, for a total cost of $11.7 million.

In August and November 2019, the Partnership took delivery of the fourth and fifth 50 percent-owned ARC7 LNG carrier newbuildings, respectively, the Vladimir Voronin and Georgiy Ushakov, which immediately commenced their 26-year charter contracts servicing the Yamal LNG project.

On September 25, 2019, the United States Government, by an Executive Order of the Department of the Treasury's Office of Foreign Assets Control (OFAC), imposed sanctions on COSCO Shipping Tanker (Dalian) Co., Ltd. (COSCO Dalian). At the time, COSCO Dalian owned 50 percent of China LNG Shipping (Holdings) Limited (CLNG). CLNG was not listed on the OFAC Order as Specially Designated National or involved in any sanctioned activity, but by virtue of being 50 percent-owned by COSCO Dalian at the time, CLNG was designated as a "Blocked Person" under OFAC's deeming rules. CLNG, in turn, owns a 50 percent interest in Teekay LNG's Yamal LNG joint venture (the Yamal LNG Joint Venture), which owns five on-the-water ARC7 LNG carriers and one ARC7 LNG carrier newbuilding. As a result of CLNG's 50 percent interest, the Yamal LNG Joint Venture at the time also qualified as a "Blocked Person" under OFAC's deeming rules.

On October 21, 2019, the COSCO group completed an ownership restructuring on arms-length terms pursuant to which its 50 percent interest in CLNG was transferred from COSCO Dalian to a non-sanctioned COSCO entity, which automatically resulted in CLNG and the Yamal LNG Joint Venture no longer being classified as a "Blocked Person" under OFAC's deeming rules. Teekay LNG does not expect any material impact to the Partnership from these resolved issues.

On October 16, 2019, the Partnership sold its last remaining conventional tanker, the Alexander Spirit, for net proceeds of $11.5 million.

Operating Results

The following table highlights certain financial information for Teekay LNG's three segments: the Liquefied Natural Gas Segment, the Liquefied Petroleum Gas Segment and the Conventional Tanker Segment (please refer to the "Teekay LNG's Fleet" section of this release below and Appendices D and E for further details).

(i) These are non-GAAP financial measures. Please refer to "Definitions and Non-GAAP Financial Measures" and the Appendices to this release for definitions of these terms and reconciliations of these non-GAAP financial measures as used in this release to the most directly comparable financial measures under GAAP.

Liquefied Natural Gas Segment

Income from vessel operations and Consolidated Adjusted EBITDA for the liquefied natural gas segment for the three months ended September 30, 2019, compared to the same quarter of the prior year, were positively impacted primarily by: the deliveries of four wholly-owned LNG carrier newbuildings (the Megara, Bahrain Spirit, Sean Spirit and Yamal Spirit) between July 2018 and January 2019; higher earnings from the Magellan Spirit, which was chartered-in from the Partnership's 52 percent-owned MALT Joint Venture commencing in September 2018; and higher earnings from the Torben Spirit upon redeployment in December 2018 at a higher charter rate. These increases were partially offset by an increase in off-hire days in the third quarter of 2019 for the Madrid Spirit due to a scheduled dry docking and repairs.

Equity income and Adjusted EBITDA from equity-accounted vessels for the liquefied natural gas segment for the three months ended September 30, 2019, compared to the same quarter of the prior year, were positively impacted primarily by: the deliveries of three ARC7 LNG carrier newbuildings between September 2018 and August 2019 to the Partnership's 50 percent-owned Yamal LNG Joint Venture; the deliveries of two LNG carrier newbuildings between July 2018 and January 2019 to the Partnership's 20 percent-owned joint venture with CLNG, CETS Investment Management (HK) Co. Limited and BW LNG Investments Pte. Ltd. (the Pan Union Joint Venture); and higher earnings in the MALT Joint Venture from the commencements of the Arwa Spirit and Marib Spirit one-year charter contracts at higher rates in June and July 2019, respectively, and recognition of drydock hire revenue for the Meridian Spirit. These increases were partially offset by the commencement of the time-charter in contract for the Bahrain Spirit floating storage unit (FSU) in September 2018 in the Bahrain LNG Joint Venture ahead of the commencement of operations of the LNG receiving and regasification terminal in Bahrain. In addition, GAAP equity income was negatively impacted by unrealized losses on non-designated derivative instruments in the Partnership's equity-accounted joint ventures in the third quarter of 2019 compared to gains on designated and non-designated derivative instruments in the third quarter of 2018.

Liquefied Petroleum Gas Segment

Loss from vessel operations and Consolidated Adjusted EBITDA for the liquefied petroleum gas segment for the three months ended September 30, 2019, compared to the same quarter of the prior year, were positively impacted by higher earnings from the Partnership's seven multi-gas carriers, which earned higher spot revenues during the third quarter of 2019.

Equity income (loss) and Adjusted EBITDA from equity-accounted vessels for the liquefied petroleum gas segment for the three months ended September 30, 2019, compared to the same quarter of the prior year, were positively impacted by higher charter rates earned and fewer off-hire days; partially offset by more scheduled dry dockings in the Partnership's 50/50 joint venture with Exmar NV (the Exmar LPG Joint Venture).

Conventional Tanker Segment

Consolidated Adjusted EBITDA for the conventional tanker segment for the three months ended September 30, 2019, compared to the same quarter of the prior year, remained comparable. Loss from vessel operations for the conventional tanker segment for the three months ended September 30, 2019, compared to the same quarter of the prior year, was positively impacted by lower write-downs related to the Alexander Spirit, European Spirit and African Spirit.

Teekay LNG's Fleet

The following table summarizes the Partnership's fleet as of November 1, 2019. The Partnership also owns a 30 percent interest in a regasification terminal under construction in Bahrain.

(i) Includes vessels leased by the Partnership from third parties and accounted for as finance leases.
(ii) The Partnership's ownership interests in these vessels range from 20 percent to 100 percent.
(iii) The Partnership's ownership interest in these newbuildings is 50 percent.
(iv) The Partnership's ownership interests in these vessels range from 50 percent to 99 percent.

Liquidity

As of September 30, 2019, the Partnership had total liquidity of $329.1 million (comprised of $142.9 million in cash and cash equivalents and $186.2 million in undrawn credit facilities).

Liquidity is expected to increase by approximately $100 million upon the acquisition by Awilco LNG of two of the Partnership's LNG carriers, the WillForce and WillPride, which are subject to purchase obligations that are due by the end of February 2020.

Investor and Analyst Meeting

Teekay Corporation (Teekay), Teekay LNG and Teekay Tankers plan to host an investor and analyst meeting on Thursday, November 14, 2019 at 8:30 a.m. (ET) with presentations from the Senior Leadership of Teekay, Teekay LNG and Teekay Tankers. A live webcast of the presentations will be available to the public in advance of the event on Teekay's website, www.teekay.com. Please allow extra time prior to the presentation to visit the site and download the necessary software required to listen to the internet broadcast. A recording of the webcast will be archived on the same website following the live presentations.

About Teekay LNG Partners L.P.

Teekay LNG Partners is one of the world's largest independent owners and operators of LNG carriers, providing LNG and LPG services primarily under long-term, fee-based charter contracts through its interests in 49 LNG carriers (including one newbuilding), 23 mid-size LPG carriers, and seven multi-gas carriers. The Partnership's ownership interests in these vessels range from 20 to 100 percent. In addition, the Partnership owns a 30 percent interest in a regasification terminal. Teekay LNG Partners is a publicly-traded master limited partnership formed by Teekay Corporation TK as part of its strategy to expand its operations in the LNG and LPG shipping sectors.

Teekay LNG Partners' common units and preferred units trade on the New York Stock Exchange under the symbols "TGP", "TGP PR A" and "TGP PR B", respectively.

For Investor Relations
enquiries contact:

Ryan Hamilton
Tel: +1 (604) 609-2963
Website: www.teekay.com

Definitions and Non-GAAP Financial Measures

This release includes various financial measures that are non-GAAP financial measures as defined under the rules of the SEC. These non-GAAP financial measures which include Adjusted Net Income Attributable to the Partners and Preferred Unitholders, Distributable Cash Flow and Adjusted EBITDA, are intended to provide additional information and should not be considered substitutes for measures of performance prepared in accordance with GAAP. In addition, these measures do not have standardized meanings across companies, and may not be comparable to similar measures presented by other companies. These non-GAAP measures are used by management, and the Partnership believes that these supplementary metrics assist investors and other users of its financial reports in comparing financial and operating performance of the Partnership across reporting periods and with other companies.

In 2018 and prior periods, the Partnership reported Cash Flow from Vessel Operations (CFVO), as a non-GAAP measure. In the first quarter of 2019, the Partnership made certain changes to its non-GAAP financial measures to more closely align with internal management reporting, annual reporting with the SEC under Form 20-F and metrics used by certain investors. CFVO from Consolidated Vessels and Total CFVO were replaced with Consolidated Adjusted EBITDA and Total Adjusted EBITDA, respectively, for current and comparative periods.

Non-GAAP Financial Measures

Adjusted EBITDA represents net income before interest, taxes, and depreciation and amortization and is adjusted to exclude certain items whose timing or amount cannot be reasonably estimated in advance or that are not considered representative of core operating performance. Such adjustments include vessel write-downs, gains or losses on sale of vessels and equity-accounted investments, unrealized gains or losses on derivative instruments, foreign exchange gains or losses, amortization of in-process contracts, adjustments for direct financing leases to a cash basis, and certain other income or expenses. Adjusted EBITDA also excludes realized gains or losses on interest rate swaps as management, in assessing the Partnership's performance, views these gains or losses as an element of interest expense and realized gains or losses on derivative instruments resulting from amendments or terminations of the underlying instruments. Consolidated Adjusted EBITDA represents Adjusted EBITDA from vessels that are consolidated on the Partnership's financial statements. Adjusted EBITDA from Equity-Accounted Vessels represents the Partnership's proportionate share of Adjusted EBITDA from its equity-accounted vessels. The Partnership does not have the unilateral ability to determine whether the cash generated by its equity-accounted vessels is retained within the entity in which the Partnership holds the equity-accounted investments or distributed to the Partnership and other owners. In addition, the Partnership does not control the timing of any such distributions to the Partnership and other owners. Adjusted EBITDA is a non-GAAP financial measure used by certain investors and management to measure the operational performance of companies. Please refer to Appendices C and E of this release for reconciliations of Adjusted EBITDA to net income and equity income, respectively, which are the most directly comparable GAAP measures reflected in the Partnership's consolidated financial statements.

Adjusted Net Income Attributable to the Partners and Preferred Unitholders excludes items of income or loss from GAAP net income that are typically excluded by securities analysts in their published estimates of the Partnership's financial results. The Partnership believes that certain investors use this information to evaluate the Partnership's financial performance, as does management. Please refer to Appendix A of this release for a reconciliation of this non-GAAP financial measure to net income, and refer to footnote (4) of the Consolidated Statements of Income for a reconciliation of adjusted equity income to equity income, the most directly comparable GAAP measure reflected in the Partnership's consolidated financial statements.

Distributable Cash Flow (DCF) represents GAAP net income adjusted for write-down of vessels, depreciation and amortization expense, deferred income tax and other non-cash items, estimated maintenance capital expenditures, unrealized gains and losses from non-designated derivative instruments, distributions relating to equity financing of newbuilding installments, distributions relating to preferred units, adjustments for direct financing leases to a cash basis, unrealized foreign currency exchange gains or losses and the Partnership's proportionate share of such items in its equity-accounted for investments. Maintenance capital expenditures represent those capital expenditures required to maintain over the long-term the operating capacity of, or the revenue generated by, the Partnership's capital assets. DCF is a quantitative standard used in the publicly-traded partnership investment community and by management to assist in evaluating financial performance. Please refer to Appendix B of this release for a reconciliation of this non-GAAP financial measure to net income, the most directly comparable GAAP measure reflected in the Partnership's consolidated financial statements.

Teekay LNG Partners L.P.
Consolidated Statements of Income
(in thousands of U.S. Dollars, except unit and per unit data)

(1) The comparative figures for vessel operating expenses and general and administrative expenses for the three and nine months ended September 30, 2018 have been reclassified to conform to the presentation adopted in the current period relating to the classification of certain related party transactions. The reclassification had the effect of decreasing vessel operating expenses and increasing general and administrative expenses by $1.6 million and $2.9 million, respectively, for the three and nine months ended September 30, 2018. There is no impact on income from vessel operations or net income as a result of this reclassification. 

(2) In September 2019, the Partnership recorded a write-down of $0.8 million for the three and nine months ended September 30, 2019 on the Alexander Spirit, compared to a write-down of $13.0 million for the same vessel during the nine months ended September 30, 2018 to its then estimated fair value. In June 2018, the Partnership wrote-down four of its wholly-owned multi-gas carriers (the Napa Spirit, Pan Spirit, Camilla Spirit and Cathinka Spirit) and recorded an impairment charge of $33.0 million for the nine months ended September 30, 2018. In addition, for the three and nine months ended September 30, 2018, the Partnership recorded aggregate write-downs of $2.2 million and $7.9 million, respectively, on the European Spirit and African Spirit conventional tankers.

(3) In January 2019 and February 2018, the Toledo Spirit and Teide Spirit, respectively, were sold and as a result of these sales, the Partnership recorded restructuring charges of $0.8 million for the three months ended June 30, 2019, $0.5 million for the three months ended September 30, 2018, and $3.0 million and $1.8 million for the nine months ended September 30, 2019 and 2018, respectively, relating to seafarer severance costs. 

(4) The Partnership's proportionate share of items within equity income as identified in Appendix A of this release is detailed in the table below. By excluding these items from equity income, the Partnership believes the resulting adjusted equity income is a normalized amount that can be used to better evaluate the financial performance of the Partnership's equity-accounted investments. Adjusted equity income is a non-GAAP financial measure.

(5) The realized (losses) gains on non-designated derivative instruments relate to the amounts the Partnership actually paid or received to settle non-designated derivative instruments and the unrealized (losses) gains on non-designated derivative instruments relate to the change in fair value of such non-designated derivative instruments, as detailed in the table below:

(6) For accounting purposes, the Partnership is required to revalue all foreign currency-denominated monetary assets and liabilities based on the prevailing exchange rates at the end of each reporting period. This revaluation does not affect the Partnership's cash flows or the calculation of distributable cash flow, but results in the recognition of unrealized foreign currency translation gains or losses in the Consolidated Statements of Income.

Foreign currency exchange  gain (loss) includes realized losses relating to the amounts the Partnership paid to settle the Partnership's non-designated cross currency swaps that were entered into as economic hedges in relation to the Partnership's Norwegian Krone (NOK) denominated unsecured bonds. Foreign currency exchange gain (loss) also includes unrealized (losses) gains relating to the change in fair value of such derivative instruments and unrealized gains (losses) on the revaluation of the NOK bonds as detailed in the table below:

(7) Other (expense) income for the three and nine months ended September 30, 2019 included $1.4 million loss recognized relating to the Torben Spirit sale-leaseback refinancing completed in September 2019. In addition, other (expense) income for the nine months ended September 30, 2019 included a $53.0 million expense for the recognition of an additional tax indemnification guarantee liability recorded within the consolidated Teekay Nakilat Corporation (the RasGas II Joint Venture), which was settled in 2018.

Teekay LNG Partners L.P.
Consolidated Balance Sheets
(in thousands of U.S. Dollars)

Teekay LNG Partners L.P.
Consolidated Statements of Cash Flows
(in thousands of U.S. Dollars)

Teekay LNG Partners L.P.
Appendix A - Reconciliation of Non-GAAP Financial Measures
Adjusted Net Income
(in thousands of U.S. Dollars)

(1) See Note 2 to the Consolidated Statements of Income included in this release for further details.

(2) See Note 3 to the Consolidated Statements of Income included in this release for further details.

(3) Unrealized foreign currency exchange gains primarily relate to the Partnership's revaluation of all foreign currency-denominated monetary assets and liabilities based on the prevailing exchange rate at the end of each reporting period and unrealized (gains) losses on the cross currency swaps economically hedging the Partnership's NOK bonds. This amount excludes the realized losses relating to the cross currency swaps for the NOK bonds. See Note 6 to the Consolidated Statements of Income included in this release for further details.

(4) Reflects the unrealized losses (gains) due to changes in the mark-to-market value of derivative instruments that are not designated as hedges for accounting purposes. See Note 4 to the Consolidated Statements of Income included in this release for further details.

(5) Reflects the unrealized losses (gains) due to changes in the mark-to-market value of derivative instruments that are not designated as hedges for accounting purposes. See Note 5 to the Consolidated Statements of Income included in this release for further details.

(6) Items affecting net income include items from the Partnership's consolidated non-wholly-owned subsidiaries. The specific items affecting net income are analyzed to determine whether any of the amounts originated from a consolidated non-wholly-owned subsidiary. Each amount that originates from a consolidated non-wholly-owned subsidiary is multiplied by the non-controlling interests' percentage share in this subsidiary to arrive at the non-controlling interests' share of the amount. The amount identified as "non-controlling interests' share of items above" in the table above is the cumulative amount of the non-controlling interests' proportionate share of the other specific items affecting net income listed in the table.

Teekay LNG Partners L.P.
Appendix B - Reconciliation of Non-GAAP Financial Measures
Distributable Cash Flow (DCF)
(in thousands of U.S. Dollars, except units outstanding and per unit data)

(1) The estimated maintenance capital expenditures relating to the Partnership's share of equity-accounted joint ventures were $11.8 million and $9.6 million for the three months ended September 30, 2019 and 2018, respectively.

Teekay LNG Partners L.P.
Appendix C - Reconciliation of Non-GAAP Financial Measures
Total Adjusted EBITDA
(in thousands of U.S. Dollars)

Teekay LNG Partners L.P.
Appendix D - Reconciliation of Non-GAAP Financial Measures
Consolidated Adjusted EBITDA by Segment
(in thousands of U.S. Dollars)

Teekay LNG Partners L.P.
Appendix E - Reconciliation of Non-GAAP Financial Measures
Adjusted EBITDA from Equity-Accounted Vessels
(in thousands of U.S. Dollars)

(1) The Partnership's equity-accounted vessels for the three months ended September 30, 2019 and 2018 include: the Partnership's 40 percent ownership interest in Teekay Nakilat (III) Corporation, which owns four LNG carriers; the Partnership's 49 percent ownership interest in the Partnership's joint venture with Exmar NV (the Excalibur Joint Venture), which owns one LNG carrier; the Partnership's 33 percent ownership interest in four LNG carriers servicing the Angola LNG project; the Partnership's 52 percent ownership interest in the Malt Joint Venture, which owns six LNG carriers; the Partnership's 50 percent ownership interest in Exmar LPG BVBA, which owns and in-charters 22 LPG carriers; the Partnership's ownership interest ranging from 20 to 30 percent in four LNG carriers as at September 30, 2019 for Shell, compared to three LNG carriers and one LNG carrier newbuilding as at September 30, 2018; the Partnership's 50 percent ownership interest in four ARC7 LNG carriers and two ARC7 LNG carrier newbuildings in the Yamal LNG Joint Venture as at September 30, 2019, compared to two ARC7 LNG carriers and four ARC7 LNG carrier newbuildings as at September 30, 2018; and the Partnership's 30 percent ownership interest in the Bahrain LNG Joint Venture, which owns an LNG receiving and regasification terminal under construction in Bahrain.

Teekay LNG Partners L.P.
Appendix F - Summarized Financial Information of Equity-Accounted Joint Ventures
(in thousands of U.S. Dollars)

(1) The Partnership's equity-accounted vessels as at September 30, 2019 and December 31, 2018 include: the Partnership's 40 percent ownership interest in Teekay Nakilat (III) Corporation, which owns four LNG carriers; the Partnership's 49 percent ownership interests in the Excalibur Joint Venture, which owns one LNG carrier; the Partnership's 33 percent ownership interest in four LNG carriers servicing the Angola LNG project; the Partnership's 52 percent ownership interest in the Malt Joint Venture, which owns six LNG carriers; the Partnership's 50 percent ownership interest in Exmar LPG BVBA, which owns and in-charters 22 LPG carriers; the Partnership's ownership interest ranging from 20 percent to 30 percent in four LNG carriers as at September 30, 2019 for Shell, compared to three LNG carriers and one LNG carrier newbuilding as at December 31, 2018; the Partnership's 50 percent ownership interest in four ARC7 LNG carriers and two ARC7 LNG carrier newbuildings in the Yamal LNG Joint Venture as at September 30, 2019, compared to two ARC7 LNG carriers and four ARC7 LNG carrier newbuildings as at December 31, 2018; and the Partnership's 30 percent ownership interest in the Bahrain LNG Joint Venture, which owns an LNG receiving and regasification terminal under construction in Bahrain.

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, among other things, regarding: the timing of newbuilding vessel deliveries and completion of the Bahrain regasification terminal; the effects of future newbuilding deliveries and the completion of the Bahrain regasification terminal on the Partnership's Total Adjusted EBITDA and earnings; expectations regarding the Partnership's 2019 and 2020 financial results; anticipated higher utilization and revenues, and fewer drydocks; expectations on capital allocation towards balance sheet delevering and future returns of capital to unitholders; and the ability to pay increased distributions on common units in 2020 and beyond. 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 shipyard and project construction delays, newbuilding specification changes or cost overruns; deliveries of vessels under charter contracts and the commencement thereof; changes in production of LNG or LPG, either generally or in particular regions; changes in trading patterns or timing of start-up of new LNG liquefaction and regasification projects significantly affecting overall vessel tonnage requirements; changes in applicable industry laws and regulations and the timing of implementation of new laws and regulations; the potential for early termination of long-term contracts of existing vessels in the Partnership's fleet; higher than expected costs and expenses; general market conditions and trends, including spot, multi-month and multi-year charter rates; inability of charterers to make future charter payments; the inability of the Partnership to renew or replace long-term contracts on existing vessels; the Partnership's or the Partnership's joint ventures' ability to secure or draw on financings for its vessels; potential lack of cash flow to reduce balance sheet leverage or of excess capital available to allocate towards returning capital to unitholders; and other factors discussed in Teekay LNG Partners' filings from time to time with the SEC, including its Report on Form 20-F for the fiscal year ended December 31, 2018. The Partnership expressly disclaims any obligation 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.