CMA Conference. March 18-20, 2013

Transcription

1 CMA Conference March 18-20, 2013

2 Forward Looking Statements This presentation 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 estimated cost and timing of delivery of FPSO, shuttle tanker, LNG and LPG newbuildings, including the Petrojarl Knarr FPSO and the two fuel-saving LNG carriers, the commencement of associated time-charter contracts and the effect on the Company s future operating results; the timing of completion of repairs and field re-installation for the Petrojarl Banff FPSO; the timing, certainty and costs of Teekay Offshore s acquisition of the HiLoad DP unit from Remora and Teekay Parent s investment in Remora, and the effect of these acquisitions on the Company s future cash flows; the estimated timing of commencement of new charter contracts upon delivery of FPSO and shuttle tanker newbuildings; the timing and certainty of securing long-term employment for the two LNG carrier newbuildings; the timing of field installation for the Voyageur Spirit FPSO and of the sale of the Voyageur Spirit FPSO from Sevan to Teekay Parent and then to Teekay Offshore; expected timing of redeliveries of vessels chartered-in by Teekay Parent; the timing, certainty and effect on Teekay Parent s balance sheet and liquidity from distribution growth from daughter subsidiaries and proceeds from sale of warehoused assets; and the Company s future capital expenditure commitments and the debt financings that the Company expects to obtain for its remaining unfinanced capital expenditure commitments. 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: changes in production of or demand for oil, petroleum products, LNG and LPG, either generally or in particular regions; greater or less than anticipated levels of tanker newbuilding orders or greater or less than anticipated rates of tanker scrapping; changes in trading patterns significantly affecting overall vessel tonnage requirements; changes in applicable industry laws and regulations and the timing of implementation of new laws and regulations; changes in the typical seasonal variations in tanker charter rates; changes in the offshore production of oil or demand for shuttle tankers, FSOs and FPSOs; decreases in oil production by or increased operating expenses for FPSO units; trends in prevailing charter rates for shuttle tanker and FPSO contract renewals; the potential for early termination of long-term contracts and inability of the Company to renew or replace long-term contracts or complete existing contract negotiations; the inability to negotiate new contracts on the two LNG carrier newbuildings or the HiLoad DP unit to be acquired from Remora; changes affecting the offshore tanker market; shipyard production or vessel conversion delays and cost overruns; delays in commencement of operations of FPSO units at designated fields; changes in the Company s expenses; the Company s future capital expenditure requirements and the inability to secure financing for such requirements; the inability of the Company to complete vessel sale transactions to its public company subsidiaries or to third parties; conditions in the United States capital markets; and other factors discussed in Teekay s filings from time to time with the SEC, including its Report on Form 20-F for the fiscal year ended December 31, The Company 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 Company s expectations with respect thereto or any change in events, conditions or circumstances on which any such statement is based. NYSE: TK 2

3 OPERATIONAL LEADERSHIP NYSE: TK 3

4 Teekay is turning 40, what a great journey it s been CRUDE TANKER FSO PRODUCT TANKER LNG CARRIER FPSO SHUTTLE TANKER Founded in 1973 as regional charterer > Evolved to tanker owner > Diversified into new segments NYSE: TK NYSE: TGP NYSE: TOO NYSE: TNK Today: $11b in assets, 170 vessels & a world leader in each of our segments < Created an innovative financial structure to raise capital & grow in assets NYSE: TK 4

5 Teekay is a Leader in Each of its Business Segments Leading Position in Leased FPSOs Leader in Harsh Weather Operations in the North Sea SBM In Service On Order BW MODEC Teekay Bluewater Bumi Offshore Armada Largest Operator of Shuttle Tankers Controls More Than 50% of the World s Fleet Teekay Knutsen NYK In Service Tranpetro Viken / PJMR 5 3 Lauritzen On Order Leading Position in LNG Carriers Operates Third Largest Independent Fleet in the World In Service 15 MOL NYK Teekay Golar Maran Gas Note: Excludes state & oil company fleets BW Gas On Order 12 K Line Largest Operator of Mid-Size 1 Conventional Tankers Transports Approximately 10% of the World s Seaborne Oil Teekay SCF Heidmar AET / Pools MISC Owned / Chartered-In Commercially Managed On Order OSG Pools Stena Sonangol Tsakos Source: Clarkson Research Services, Platou, Company Websites, Industry Sources. 1 Aframax and Suezmax tankers. Includes vessels under commercial management. 2 Excludes one VLCC and six MR product tankers. 3 Includes shuttle tankers. NYSE: TK 5

6 The Teekay Competitive Advantage Operational Excellence Customer Relationships Business Development Corporate Governance Project Management Engineering Strategic Partnerships Financial Expertise Market Insight NYSE: TK 6

7 Organizational Alignment NYSE: TK 7

8 PROJECT DEVELOPER NYSE: TK 8

9 $3.5 billion Invested in Gas and Offshore Projects Since 2011 Voyageur Spirit FPSO, Upgrade Petrojarl Banff FPSO, Repair & Upgrade Shuttle Tanker Newbuildings Petrojarl Knarr FPSO, Newbuilding Hummingbird Spirit FPSO, Commercial Integration Maersk LNG Joint Venture Exmar LPG Joint Venture LNG Newbuildings Piranema Spirit FPSO, Integration Final Angola LNG carrier delivered Establishment of Teekay Marine Ltd. Cidade de Itajai FPSO Conversion NYSE: TK 9

10 Teekay Projects in Execution /16 Cidade de Itajai FPSO Voyageur Spirit Petrojarl I Redeployment Petrojarl Banff Re-start Petrojarl Knarr FPSO SHUTTLE & FSO 4 BG Shuttle Tankers Remora HiLoad DP Unit Salamander FSO Project GAS 4 Exmar LPG Newbuildings 4 Exmar LPG Newbuildings 2 LNG Newbuildings TANKER VLCC Newbuilding NYSE: TK 10

11 LNG Newbuildings Recently ordered two 173,400 cbm LNG Carriers, with options to order up to three additional vessels, from Daewoo Shipbuilding and Marine Engineering (DSME) of South Korea Equipped with efficient M-type, Electronically Controlled, Gas Injection (MEGI) twin engines TGP intends to secure long-term employment for both vessels prior to delivery in early-2016 NYSE: TK 11

12 MEGI Engine Technology Revolutionary technology with MAN s MEGI engines: Reducing fuel consumption by up to 30% over current DFDE engine technology - Savings of $20,000 per day at today s fuel prices Reducing operating costs (OPEX) by 10% with fewer cylinders Patented sealed LNG containment system allowing flexible boil off management and maximizing cargo delivered Reduced carbon emissions NYSE: TK 12

13 Remora s HiLoad DP Unit Provides Strategic Benefits Complements TOO s market leading shuttle tanker operations and broadens offshore loading service offering Alternative Offloading solution, especially in longhaul export markets with benign sea conditions An additional channel for future growth projects Omnibus agreement will provide right of first refusal for TOO to acquire future HiLoad DP units NYSE: TK 13

14 Petrojarl Cidade de Itajai FPSO Charterer Petrobras First-Oil February, 2013 Aframax conversion at Jurong Shipyard, Singapore 50/50 Joint Venture with Brazilbased Odebrecht Firm Contract Length: 9 years Extension Options: 6 x 1 years Designed Water Depth: up to 1,000m Operating Depth: ~250m Processing Capacity: 80,000 bbls/d Storage Capacity: 650,000 bbls Tiro & Sidon fields on Block BM- S-40, Santos Basin, offshore Brazil NYSE: TK million barrels of recoverable oil

15 Brazil Newbuildings Delivering for BG Contract in 2013 Charterer BG Group Delivery Dates: Hull 2037, Q Hull 2038, Q Hull 2039, Q Hull 2040, Q Received commitments for longterm financing for Hull 2037 and Hull 2038 Suezmax-sized DP2 shuttle tankers Delivered Cost: ~$120m / vessel Being constructed at Samsung Shipyard, South Korea Contract Length: 10 years plus 2 x 5-year options Will service BG s pre-salt requirements NYSE: TK 15

16 Knarr FPSO Project Knarr FPSO is Teekay s largest FPSO newbuilding project to date Maximum design production capacity of 63,000 bbls/day Currently under construction at the Samsung Heavy Industries yard in South Korea Upon delivery, the Knarr FPSO will be employed on a 10-year contract with BG on the Knarr oil and gas field in the North Sea NYSE: TK 16

17 Strategic Transaction with Sevan Teekay saw the current market need Customers became increasingly accepting of Sevan s new technology Innovative technology could be applied to multiple applications Teekay could offer customers both FPSO solutions => increasing competitive position Teekay had immediate access to capital required complete transaction: Cash, PIPE investors and bridge-financing Ultimately, project execution provided value: Voyageur Spirit conversion held to budget and ~$80 million liquidity uplift on sale to TOO $25 million investment in Sevan up ~3x NYSE: TK 17

18 ASSET MANAGER NYSE: TK 18

19 2013 Priorities Execute on FPSO newbuilding projects currently warehoused by Teekay Parent Pursue redeployment opportunities for existing FPSOs and complete Banff FPSO repairs Enhance GP cash flows through dropdown of eligible FPSOs to Teekay Offshore and pursuit of future Teekay LNG growth initiatives Complete implementation of previously announced cost saving initiatives Complete project financings and refinancings TEEKAY CORPORATION (PARENT) Continue focus on high HSEQ standards and strong operational KPIs across all fleets TEEKAY LNG PARTNERS TEEKAY OFFSHORE PARTNERS TEEKAY TEEKAY TANKERS LTD. Bid on point-to-point LNG Bid on FSRU projects Consider accretive on-thewater asset acquisitions Deliver shuttle tanker newbuildings in 2013 Complete HiLoad DP acquisition and capital upgrades Bid on new FPSO and FSO projects with post-2015 deliveries Consider investment in fuelefficient conventional tanker newbuildings or acquisition of quality on-the-water vessels. NYSE: TK 19

20 Executing on Our Financial Strategy Improving Profitability Reducing costs and adding profitable growth Expected to return to run-rate profitability in 2013 compared to a net loss of over $100 million in 2011 Prudently Managing Growth Teekay Parent on the path to being net debt free by end-2014 Disciplined approach to new investments Accessing Multiple Sources of Capital Corporate structure provides financial flexibility Over $6.0 billion of debt and equity capital raised during past 4 years Continuing to diversify sources of capital NYSE: TK 20

21 $ Millions Focus on Profitability is Achieving Results On a Consolidated Basis, Teekay Corporation profitability is improving Expect to return to run-rate profitability in 2013, despite continued weakness in spot tanker rates $0 Teekay Corporation Consolidated Adjusted Net Income (loss) 1 ($20) ($40) ($60) ($80) ($100) ($120) ($140) Impact of Petrojarl Banff FPSO off-hire Spot Tanker Rates Aframax $16,300 / day $13,000 / day $12,200 / day Suezmax $22,500 / day $14,300 / day $17,100 / day 1) Consolidated adjusted net income (loss) excludes gains and losses on vessel sales / write downs, unrealized gain / loss on derivatives and other Appendix A adjustments made from time to time. Please refer to Appendix A in Teekay Corporation s quarterly earnings releases for more detail. NYSE: TK 21

22 Diversified Business Model As at December 31, 2006 As at September 30, 2012 Pro forma* Spot-Rate Convention al Tanker 20% Shuttle Tanker and FSO 24% Fixed-Rate Conventional Tanker 10% Spot-Rate Conventional Tanker 9% Shuttle Tanker and FSO 18% Fixed-Rate Convention al Tanker 13% FPSO 30% Liquified Gas 19% FPSO 24% Liquefied Gas 33% Total Assets: $7.7 billion $13.0 billion * Pro forma for newbuildings to be delivered and the new LPG joint venture with Exmar, including newbuildings to be delivered. NYSE: TK 22

23 Diversifying Sources of Capital Current Sources Commercial Bank Debt Expanded banking group $200 million Corporate Revolver secured by Daughter LP Units Export Credit Agency (ECA) Facilities U.S. Corporate Bonds Norwegian Kroner Bonds TK, TGP and TOO Joint Venture Partners Daughter Company Equity Overnights, PIPEs Other Potential Sources Teekay Corporation Sources of Capital (December 31, Present) ($ millions) $2,624 $2,141 $681 $186 $450 Consolidated Total: $6.1 Billion Project Bonds Structured debt / equity instruments NYSE: TK 23

24 TEEKAY IS A PLAY ON THE BUILD-OUT OF GLOBAL ENERGY INFRASTRUCTURE NYSE: TK 24

25 Global Energy Demand to Grow 40% by 2030 Source: BP NYSE: TK 25

26 USD Billions Global Infrastructure Build-Out In Progress LNG LNG is the key to transitioning natural gas from a regional to a global market Growth in LNG liquefaction, transportation and regasification projects LNG is playing an increasing role in many countries energy mix Oil Remaining conventional land-based crude increasingly controlled by National Oil Companies Business of Independent Oil Companies shifting to deepwater offshore and unconventional crude sources (i.e. oil sands, shale, heavy oil) LNG Import / Export Countries Exporting Countries Importing Countries Source: Clarksons / GIIGNL / JP Morgan Deepwater Capex Forecast Source: Douglas Westwood NYSE: TK 26

27 OFFSHORE NYSE: TK 27

28 World Becoming More Reliant On Offshore Oil Decrease in total global and North Sea offshore oil production Continued increase in deepwater well supply Historic high rates of deepwater drilling will lead to FPSO and shuttle demand in future years Trend towards deeper water suits FPSO and shuttle solutions World Offshore Crude Oil Production by Type and Region Source: IEA World Energy Outlook, 2012 NYSE: TK 28

29 Innovation and Increasing Oil Production Production lags exploration and drilling by roughly 10 years or more on the Norwegian Continental Shelf (NCS) Increasing amount of drilling on the NCS suggests project pipeline for FPSOs & FSOs should be strong in the long-term Mobile Drill Rigs on Norwegian Continental Shelf to 2017 Source: Norwegian Petroleum Directorate, The Shelf in 2012 NYSE: TK 29

30 Strong Future Demand For FPSOs FPSOs in the Planning Stage FPSO Forecast (Next 5 Years) Source: IMA Current Avg. Orders per Orders year per year ( ) Low Case Base Case Low Case Base Case High Case Next 5 Years High Case The number of projects which could require an FPSO has increased significantly in the past five years Estimate of FPSO orders per year over the next five years depending on the global economy, oil demand and energy prices Operational and engineering expertise required to be successful in the leased FPSO business creates a high barrier to entry NYSE: TK 30

31 GAS NYSE: TK 31

32 LNG Shipping In The Golden Age of Gas LNG supply expected to grow by 4.5% p.a. to 2030, more than twice as fast as underlying global gas production (2.1% p.a.) Demand growth driven by the power generation sector with gas displacing coal Non-OECD, led by China, accounts for the majority of demand growth Worldwide build-out of a global LNG market requires significant investment in infrastructure and logistics chain Liquefaction Plant Regasification Plant Upstream LNG Carrier End User Floating LNG FSRU NYSE: TK 32

33 Million Tonnes Million Tonnes Per Annum LNG Demand Growth Primarily Driven By China and India LNG is a cornerstone of China s energy mix Chinese LNG imports expected to double to ~25-30 million tonnes (MT) by 2015 Domestic gas shortfall prompting India to turn to LNG imports India planning to double regasification capacity by end-2015 Chinese LNG Purchase Agreements Indian Regasification Capacity Current Secured by 2016 Australia Qatar Indonesia Malaysia PNG Portfolio MOU Source: Thomson Reuters Source: Ambit Capital NYSE: TK 33

34 Million Tonnes Per Annum (MTPA) Strong LNG Supply Growth Post-2015 Australia expected to add ~80 MTPA of LNG supply by 2020 Requirement for additional newbuildings to move new LNG volumes 500 LNG Capacity Additions By Region vs. LNG Carrier Orderbook Others Russia Africa North America Australia Existing MTPA by 2020 = 170 incremental LNG carriers Source: Internal Estimates / Clarksons NYSE: TK 34

35 North American Exports Provide Upside Global LNG Production Capacity North America Australia Qatar Rest of World Existing Global LNG Capacity Under Construction Proposed Projects Million Tonnes per Annum 200+ MTPA of North American LNG export projects in the planning stage Cheniere s 18 MTPA Sabine Pass terminal the only project fully approved Every 10 MTPA moving USG to Asia creates demand for ~18-20 LNGCs Versus ~7-8 LNGCs to move 10 MTPA from Australia to Asia NYSE: TK 35

36 Looking to Take Advantage of Regional Pricing Current Spot Natural Gas Prices US Henry Hub $3.19 / MMBtu N.E. Asia LNG $19.00 / MMBtu UK NBP $10.36 / MMBtu $3-4 / MMBtu Henry Hub means US LNG can be delivered into Asia for ~$7-10 / MMBtu NYSE: TK 36

37 Number of Vessels LNG Fleet Utilization Improves Post LNG carriers due to deliver by end-2015 Little new LNG supply growth during this time; fleet utilization expected to fall New LNG supply post-2015 expected to create significant demand for new vessels over and above the current orderbook Tonnage Supply / Demand Balance VESSEL SURPLUS VESSEL DEFICIT Vessels on Order Vessel Demand Surplus / Deficit Total Surplus / Deficit Source: Clarksons / Internal Estimates NYSE: TK 37

38 TANKERS NYSE: TK 38

39 000 USD / Day Currently In 5 th Year of Tanker Market Downturn Aframax Spot Rates Suezmax Spot Rates VLCC Spot Rates Source: Clarksons Spot tanker rates have been below the long-term average since 2009 Aframax average of $14,300 / day vs. $23,500 / day long-term average Suezmax average of $21,700 / day vs. $31,000 / day long-term average NYSE: TK 39

40 Gradual Recovery Starting Late 2013 / % 90% 88% 86% 84% 82% 80% 78% 76% Fleet Utilization Tanker Demand Growth Tanker Supply Growth 8% 7% 6% 5% 4% 3% 2% 1% 0% 2012 / 13 projected to be the trough in terms of tanker fleet utilization / rates Improvement in rates from late 2013 / 2014 due to slowing fleet growth (sub-3% p.a.) coupled with economic recovery, improved oil demand Pace of ordering is low and must remain low Aframax supply / demand outlook more balanced than other tanker segments Note: Tanker Supply Growth for 2015 and 2016 are based on forecasted assumptions versus actual orders. NYSE: TK 40

41 Shift in Global Refining Driving Long Haul LR2 Product Tanker Demand Refinery Capacity Additions / Reductions mb/d +2.9 mb/d To Asia / Pacific +1.9 mb/d +0.9 mb/d -0.4 mb/d N. American refining capacity remains flat as US East Coast / Caribs closures are balanced by expansion projects in US Gulf -0.3 mb/d Refinery capacity expansion Refinery capacity contraction NYSE: TK 41

42 NYSE: TK 42