These 15-year contracts, plus extension options, will initially be serviced by one of Teekay Offshore’s existing shuttle tankers, the Navion Hispania, and two to three third party-owned shuttle tankers currently operating in East Coast Canada, which will be chartered-in to Teekay Offshore’s Canadian affiliate located in St John’s, Newfoundland, prior to the delivery of up to four shuttle tanker newbuildings.
Teekay Offshore will enter into shipbuilding contracts to construct three suezmax-sized, DP2 shuttle tanker newbuildings with a South Korean shipyard for a fully built-up cost of approximately $365m, with an option to order one additional vessel should a fourth vessel be required. The three firm vessels are expected to be delivered in the fourth quarter of 2017 through the first half of 2018.
“These new, strategic long-term shuttle tanker contracts mark Teekay Offshore’s entrance into the growing Eastern Canada offshore oil production market, which is a focal point for Canadian oil and gas development,” commented Peter Evensen, CEO of Teekay Offshore. Evensen continued, “Teekay Offshore now has a leading market position in all three DP shuttle tanker basins, including the North Sea, Brazil and now the East Coast of Canada. I am pleased that we continue to secure new, accretive growth in our offshore logistics business, which increases the partnership’s growth pipeline to $3.7bn of capital projects and extends our growth into late-2017 and 2018.”