Teekay Offshore expects an upturn in its fortunes next year as key vessel markets improve and it deploys $640m in finance from Brookfield Asset Management.
Speaking at the Marine Money Ship Finance Forum in New York, Scott Gayton, vice president of finance at parent firm Teekay Corp, said the tanker giant's offshore spin-off will be “bringing on stream $200m in annual Ebitda".
The improved outlook comes after Teekay Offshore reported a third-quarter loss of $320m, its largest ever. But Gayton said the Brookfield investment moves Teekay from “more of a defensive position to an offensive position” as its debt is reduced and its newbuildings get funded. The newbuildings are arriving as new offshore production comes on line.
The International Energy Agency (IEA) sees increased volumes from key markets for the New York-listed owner of floating production, storage and offloading units, shuttle tankers and offshore support vessels. In its latest monthly report, the agency says Canada, Brazil and the UK are "notable sources of growth" for oil supply next year.
Brazil’s production is expected to reach a record three million barrels per day (bpd) in 2018, the IEA says. Recent auctions for new offshore fields are also positive for further development. Teekay will begin charters for two FPSOs, the Libra and Petrojarl I, to work offshore of Brazil.
Gayton said Brazil’s growth will benefit other business as well as FPSOs. Petrobras is tendering to charter in three new shuttle tankers, a business that Teekay remains “very excited about”, he added. “They [Petrobras] do see their oil production needs increasing.”
Teekay is also benefiting from resurgent production in the North Sea, where Premier Oil extended its charter on the FPSO Voyageur Spirit, which will be employed until April 2019. UK North Sea oil production is expected to reach a three-year high of 1.25 million bpd next year, the IEA says.
In Canada, Teekay is delivering the 148,150-dwt Beothuk Spirit and 155,000-dwt Norse Spirit (both built 2017) to serve producers along the east coast. A third shuttle tanker, the 155,000-dwt Dorset Spirit, is scheduled to arrive in the first quarter of 2018.
