Teekay LNG, one of the world’s largest owners and operators of liquefied natural gas carriers, said its distributable cash flow rose 10 percent to $66.2 million in the first quarter, as compared to the same period a year ago.
The increase in distributable cash flow was primarily due to lower interest expense resulting from the December 2014 termination of capital leases, and the subsequent refinancing of three 70 percent -owned LNG carriers, Teekay LNG said in a statement on Wednesday.
“ The Partnership’s diversified portfolio of long-term fixed-rate contracts continued to generate stable cash flow, resulting in a positive coverage ratio for the quarter ,” commented Peter Evensen, Chief Executive Officer of Teekay GP, the general partner of Teekay LNG .
“ With approximately $11.2 billion of forward fixed-rate revenues with an average duration of 13 years, the Partnership is largely insulated from short-term LNG shipping rate fluctuations and remains well-positioned for expected future growth. Spot and short-term LNG shipping rates continued to decline since the start of 2015 due to low Asian LNG prices, production outages at various liquefaction plants and the delivery of speculative LNG carriers ahead of corresponding LNG supply growth.
With LNG liquefaction export growth expected to occur from the second half of 2015 onwards, mostly located in the U.S. and Australia, and the restart of certain existing liquefaction plants, the Partnership expects the supply/demand balance to tighten, ” Evensen added.
Image: Teekay