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Teekay Offshore Signs Brazil Shuttle Tanker Contract to Be Serviced by Four Newbuildings


June 24, 2011 - London

HAMILTON, BERMUDA--(Marketwire - June 23, 2011) - Teekay Offshore GP L.L.C., the general partner of Teekay Offshore Partners L.P. (Teekay Offshore or the Partnership) (NYSE: TOO), announced today that it has entered into a new long-term contract with a subsidiary of BG Group plc (BG) to provide shuttle tanker services in Brazil.

The contract with BG will be serviced by four Suezmax-size DP2 shuttle tanker newbuildings to be constructed by Samsung Heavy Industries in South Korea. Upon delivery in mid- to late-2013, the vessels will commence operations under 10-year time-charters. The contract with BG also includes certain extension options and vessel purchase options.

"These strategic new long-term shuttle tanker time-charters with BG further strengthen the Partnership's position in the fast-growing Brazilian offshore market," commented Peter Evensen, Chief Executive Officer of Teekay Offshore GP L.L.C. "In addition to increasing our Brazil based shuttle tanker fleet size by approximately 30 percent, this transaction is expected to be accretive upon delivery of the vessels and will provide Teekay Offshore with additional customer diversification and cash flow stability."

About Teekay Offshore

Teekay Offshore Partners L.P., a publicly-traded master limited partnership formed by Teekay Corporation (NYSE: TK), is an international provider of marine transportation, oil production and storage services to the offshore oil industry. Teekay Offshore owns 40 shuttle tankers (including five chartered-in vessels and five committed newbuildings), five Floating Storage and Offtake (FSO) units, 11 conventional oil tankers, and two Floating Production Storage and Offloading (FPSO) units. Teekay Offshore also has rights to participate in certain other FPSO and shuttle tanker opportunities provided by its sponsor, Teekay Corporation.

Teekay Offshore Partners' common units trade on the New York Stock Exchange under the symbol "TOO".

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 regarding: the expecting timing for delivery of the four newbuilding shuttle tankers from the shipyard and commencement of their respective long-term time-charter contracts; the expected accretion to the Partnership's distributable cash flow per unit resulting from the new time-charter contracts with BG and impact on the Partnership's overall cash flow stability; and the outlook for growth in the Brazil offshore market. 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: greater than expected vessel construction costs; changes to vessel delivery dates as a result of shipyard delays; greater than expected increases in operating expenses; potential early termination of contracts; potential extension of contracts; potential exercise by BG of certain vessel purchase options; various factors affecting the growth of the Brazil offshore oil market; and other factors discussed in Teekay Offshore's filings from time to time with the SEC, including its Report on Form 20-F for the fiscal year ended December 31, 2010. The Partnership 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 Partnership's expectations with respect thereto or any change in events, conditions or circumstances on which any such statement is based.

Contacts:
Teekay Offshore GP L.L.C.
Kent Alekson
Investor Relations
+ 1 (604) 609-6442
www.teekayoffshore.com




This announcement is distributed by Thomson Reuters on behalf of Thomson Reuters clients.

The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and other applicable laws; and
(ii) they are solely responsible for the content, accuracy and originality of the
information contained therein.

Source: Teekay Offshore Partners L.P. via Thomson Reuters ONE

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