GlobeNewswire Inc | May 13, 2021 02:00AM EDT

May 13, 2021

Highlights

-- GAAP net income attributable to the partners and preferred unitholders of $87.6 million and GAAP net income per common unit of $0.92 in the first quarter of 2021. -- Adjusted net income(1) attributable to the partners and preferred unitholders of $60.5 million and adjusted net income per common unit of $0.61 in the first quarter of 2021 (excluding other items listed in Appendix A to this release). -- Total adjusted EBITDA(1) of $184.3 million in the first quarter of 2021. -- Secured three LNG charters during March and April 2021, increasing the Partnership's LNG fleet to 98 percent fixed for the remainder of 2021, and 89 percent fixed for 2022. -- Teekay LNG increased its common unit distributions by 15 percent to $1.15 per common unit, on an annualized basis, commencing with the first quarter's distribution to be paid in May 2021.

HAMILTON, Bermuda, May 13, 2021 (GLOBE NEWSWIRE) -- Teekay GP L.L.C., the general partner (the General Partner) of Teekay LNG Partners L.P. (TeekayLNG or the Partnership) (NYSE: TGP), today reported the Partnerships results for the quarter ended March31, 2021.

Consolidated Financial Summary

Three Months Ended March 31, December March 31, 2021 31, 2020 2020(in thousands of U.S. Dollars, except per (unaudited) (unaudited) (unaudited)unit data)GAAP FINANCIAL COMPARISON Voyage revenues 152,802 154,076 139,887 Income from vessel operations 70,611 65,169 21,738 Equity income 37,516 15,359 373 Net income (loss) attributable to the 87,591 35,142 (32,994 )partners and preferred unitholdersLimited partners? interest in net income 0.92 0.32 (0.50 )(loss) per common unitNON-GAAP FINANCIAL COMPARISON Total adjusted EBITDA^(1) 184,287 190,228 188,388 Distributable cash flow (DCF)^(1) 82,019 85,033 74,877 Adjusted net income attributable to the 60,466 59,978 52,236 partners and preferred unitholders^(1)Limited partners? interest in adjusted net 0.61 0.61 0.58 income per common unit

These are non-GAAP financial measures. Please refer to ?Definitions and Non-GAAP Financial Measures? and the Appendices to this release for(1) definitions of these terms and reconciliations of these non-GAAP financial measures as used in this release to the most directly comparable financial measures under United States generally accepted accounting principles (GAAP ).

First Quarter of 2021 Compared to First Quarter of 2020

GAAP net income and non-GAAP adjusted net income attributable to the partners and preferred unitholders were positively impacted for the three months ended March 31, 2021, compared to the same quarter of the prior year, primarily due to a decrease in operational claims under the Partnerships charter contracts and higher rates earned for certain of the Partnership's 50 percent-owned LPG carriers. These increases were partially offset by more scheduled dry dockings, redeployment of certain LNG carriers at lower rates, and the timing of certain vessel operating expenses during the first quarter of 2021.

GAAP net income attributable to the partners and preferred unitholders was also positively impacted by unrealized gains on non-designated derivative instruments in the first quarter of 2021, compared to unrealized losses in the first quarter of 2020, and by write-downs recorded on the Partnership's multi-gas carriers in the first quarter of 2020. These increases were partially offset by the realized loss on the termination of one of the Partnership's interest rate swap agreements associated with a debt refinancing completed in the first quarter of 2021.

First Quarter of 2021 Compared to Fourth Quarter of 2020

GAAP net income and non-GAAP adjusted net income attributable to the partners and preferred unitholders were positively impacted for the three months ended March31, 2021, compared to the three months ended December 31, 2020, primarily due to a decrease in operational claims under the Partnerships charter contracts, lower repairs and maintenance expenses, and lower net interest expense during the first quarter of 2021. These increases were partially offset by redeployment of certain LNG carriers at lower rates and unscheduled off-hire for repairs.

GAAP net income attributable to the partners and preferred unitholders for the three months ended March 31, 2021 was also positively impacted by unrealized gains on non-designated derivative instruments and unrealized foreign currency exchange gains in the first quarter of 2021, compared to unrealized losses on non-designated derivative instruments and unrealized foreign currency exchange losses in the fourth quarter of 2020, and by certain asset write-downs recorded in the fourth quarter of 2020 compared to no asset write-downs in the first quarter of 2021. These increases were partially offset by the realized loss on the termination of one of the Partnership's interest rate swap agreements associated with a debt refinancing completed in the first quarter of 2021 and an increase in the unrealized credit loss provision recorded in the first quarter of 2021 compared to the first quarter of 2020.

CEO Commentary

"The strength of our fixed-rate LNG contract portfolio was evident again this quarter as Teekay LNG continued to generate strong earnings and cash flows even as the broader spot LNG shipping market declined from the high levels experienced during the recent winter period, commented Mark Kremin, President and Chief Executive Officer of Teekay Gas Group Ltd. This decline was short-lived, however, as LNG demand rebounded counter-seasonally in late-March and into the second quarter of 2021. We were able to take advantage of this strength by chartering out three LNG vessels, including one on a 12-month spot market-linked contract that allows us to achieve full utilization of the vessel while also retaining upside to strong markets. As a result of these recent charters, our LNG fleet is now 98 percent fixed for the remainder of 2021 and 89 percent fixed for 2022, providing us with a great deal of forward visibility on our business and cash flows."

Mr. Kremin continued, "In mid-April, we announced an increase to our quarterly common unit distribution by 15 percent, to $1.15 per unit per annum, which was our third consecutive annual double-digit increase to our distribution. Importantly, this increase is consistent with our balanced capital allocation strategy and we believe that this level of distribution is very well covered by stable, long-term contracts, which also enables the Partnership to continue delevering its balance sheet and retain financial flexibility to optimally allocate capital in the future as global demand for LNG continues to grow."

Summary of Recent Events

Chartering Activities

In April 2021, the Partnership secured a fixed-rate charter contract for the Oak Spirit MEGI LNG carrier, which is expected to commence in August or September 2021, for a period of one-year.

In March 2021, the Partnership secured a one-year, spot market-linked charter contract, with a one-year, fixed-rate option for the Creole Spirit MEGI LNG carrier. This new charter contract commenced in March 2021.

In March 2021, the charterer of the 52 percent-owned Arwa Spirit DFDE LNG carrier exercised its one-year option to extend the charter contract to May 2022 at a fixed-rate.

Financing Activities

In February 2021, the Partnership's 70 percent-owned joint venture with PT Berlian Laju Tanker (the Tangguh Joint Venture), refinanced its term loan which was scheduled to mature in 2021, by entering into a new, $191.5 million term loan maturing in February 2026.

Operating Results

The following table highlights certain financial information for Teekay LNGs segments: the Liquefied Natural Gas Segment and the Liquefied Petroleum Gas Segment (please refer to the Teekay LNGs Fleet section of this release below and Appendices D and E for further details).

Three Months Ended March 31, 2021 March 31, 2020(in thousands of (unaudited) (unaudited)U.S. Dollars) Liquefied Liquefied Liquefied Liquefied Natural Petroleum Total Natural Petroleum Total Gas Gas Gas Gas Segment Segment Segment SegmentGAAP FINANCIAL COMPARISONVoyage revenues 141,416 11,386 152,802 132,570 7,317 139,887 Income (loss)from vessel 71,019 (408 ) 70,611 67,182 (45,444 ) 21,738 operationsEquity income 32,939 4,577 37,516 182 191 373 NON-GAAPFINANCIAL COMPARISONConsolidatedadjusted EBITDA^ 104,827 1,262 106,089 101,543 1,603 103,146 (i)Adjusted EBITDAfrom 66,766 11,432 78,198 75,970 9,272 85,242 equity-accountedvessels^(i)Total adjusted 171,593 12,694 184,287 177,513 10,875 188,388 EBITDA^(i)

These are non-GAAP financial measures. Please refer to ?Definitions and Non-GAAP Financial Measures? and the Appendices to this release for (i) definitions of these terms and reconciliations of these non-GAAP financial measures as used in this release to the most directly comparable financial measures under GAAP.

Liquefied Natural Gas Segment

Income from vessel operations and consolidated adjusted EBITDA(1) for the LNG segment for the three months ended March31, 2021, compared to the same quarter of the prior year, increased primarily due to a decrease in operational claims on certain of the Partnership's LNG carriers. This increase was partially offset by more scheduled dry dockings, redeployment of one LNG carrier at a lower rate and the timing of vessel operating expenditures for certain of the Partnership's LNG carriers during the first quarter of 2021.

Equity income and adjusted EBITDA from equity-accounted vessels(1) for the LNG segment for the three months ended March31, 2021, compared to the same quarter of the prior year, were negatively impacted primarily due to lower earnings from the Partnership's 52 percent-owned joint venture with Marubeni Corporation (the MALT Joint Venture) as a result of lower charter rates earned upon redeployment of the Marib Spirit, Arwa Spirit and Methane Spirit between May 2020 and February 2021, more off-hire days for scheduled dry dockings and unscheduled repairs, and an increase in vessel operating expenses in the first quarter of 2021 compared to the first quarter of 2020 mainly due to the timing of certain expenditures.

In addition, GAAP equity income was positively impacted by unrealized gains on non-designated derivative instruments in the first quarter of 2021, compared to unrealized losses in the first quarter of 2020.

Liquefied Petroleum Gas Segment

Loss from vessel operations for the LPG segment for the three months ended March31, 2021 was lower, compared to the same quarter of the prior year, mainly as a result of write-downs recorded in the first quarter of 2020 on six multi-gas carriers.

Consolidated adjusted EBITDA(1) for the LPG segment for the three months ended March31, 2021 was comparable to the same quarter of the prior year.

Equity income and adjusted EBITDA from equity-accounted vessels(1) for the LPG segment for the three months ended March 31, 2021, compared to the same quarter of the prior year, were positively impacted from higher charter rates earned in the Partnership's 50 percent-owned LPG joint venture with Exmar NV (the Exmar LPG Joint Venture). In addition, equity income for the LPG segment for the three months ended March 31, 2021, compared to the same quarter of the prior year, was positively impacted by lower net interest expense and unrealized gains on non-designated derivative instruments in the first quarter of 2021, compared to unrealized losses in the first quarter of 2020.

These are non-GAAP financial measures. Please refer to ?Definitions and Non-GAAP Financial Measures? and the Appendices to this release for(1) definitions of these terms and reconciliations of these non-GAAP financial measures as used in this release to the most directly comparable financial measures under GAAP.

Teekay LNG's Fleet

The following table summarizes the Partnerships fleet as of May 1, 2021. In addition, the Partnership owns a 30 percent interest in an LNG regasification terminal in Bahrain.

Number of Vessels Owned and In-Chartered Vessels^(i)LNG Carrier Fleet 47^(ii)LPG/Multi-gas Carrier Fleet 30^(iii)Total 77

(i) Includes vessels leased by the Partnership from third parties and accounted for as finance leases. (ii) The Partnership?s ownership interests in these vessels range from 20 percent to 100 percent. (iii) The Partnership?s ownership interests in these vessels range from 50 percent to 100 percent.

Liquidity

As of March31, 2021, the Partnership had total liquidity of $406.2 million (comprised of $163.5 million in cash and cash equivalents and $242.7million in undrawn credit facilities) compared to $461.6 million as of December 31, 2020. The reduction in liquidity primarily relates to the swap termination payment and fees incurred in connection with the refinancing of the Tangguh Joint Ventures debt facility as well as drydocking and other capital modification expenditures incurred by the Partnership during the first quarter of 2021.

Conference Call

The Partnership plans to host a conference call on Thursday, May 13, 2021 at 1:00 p.m. (ET) to discuss the results for the first quarter of 2021. All unitholders and interested parties are invited to listen to the live conference call by choosing from the following options:

-- By dialing 1 (800) 367-2403 or 1 (647) 490-5367, if outside North America, and quoting conference ID code 7355560. -- By accessing the webcast, which will be available on Teekay LNGs website at www.teekay.com (the archive will remain on the website for a period of one year).

An accompanying First Quarter 2021 Earnings Presentation will also be available at www.teekay.com in advance of the conference call start time.

About Teekay LNG Partners L.P.

Teekay LNG Partners is one of the world's largest independent owners and operators of LNG carriers, providing LNG and LPG services primarily under long-term, fee-based charter contracts through its interests in 47 LNG carriers, 23 mid-size LPG carriers, and seven multi-gas carriers. The Partnership's ownership interests in these vessels range from 20 to 100 percent. In addition, the Partnership owns a 30 percent interest in an LNG regasification terminal. Teekay LNG Partners is a publicly-traded master limited partnership formed by Teekay Corporation (NYSE: TK) as part of its strategy to expand its operations in the LNG and LPG shipping sectors.

Teekay LNG Partners common units and preferred units trade on the New York Stock Exchange under the symbols TGP, TGP PR A and TGP PR B, respectively.

For Investor Relations enquiries contact:

Ryan HamiltonTel: +1 (604) 609-2963Website: www.teekay.com

Definitions and Non-GAAP Financial Measures

This release includes various financial measures that are non-GAAP financial measures as defined under the rules of the SEC. These non-GAAP financial measures which include Adjusted Net Income Attributable to the Partners and Preferred Unitholders, Distributable Cash Flow and Adjusted EBITDA, are intended to provide additional information and should not be considered substitutes for measures of performance prepared in accordance with GAAP. In addition, these measures do not have standardized meanings across companies, and may not be comparable to similar measures presented by other companies. These non-GAAP measures are used by management, and the Partnership believes that these supplementary metrics assist investors and other users of its financial reports in comparing financial and operating performance of the Partnership across reporting periods and with other companies.

Non-GAAP Financial Measures

Adjusted EBITDA represents net income (loss) before interest, taxes, and depreciation and amortization and is adjusted to exclude certain items whose timing or amount cannot be reasonably estimated in advance or that are not considered representative of core operating performance. Such adjustments include unrealized credit loss provisions, unrealized gains or losses on non-designated derivative instruments, write-downs of vessels, gains or losses on sales of vessels, foreign currency exchange gains or losses, adjustments for direct financing and sales-type leases to a cash basis, and certain other income or expenses. Adjusted EBITDA also excludes realized gains or losses on interest rate swaps as management, in assessing the Partnership's performance, views these gains or losses as an element of interest expense and realized gains or losses on derivative instruments resulting from amendments or terminations of the underlying instruments. Consolidated Adjusted EBITDA represents Adjusted EBITDA from vessels that are consolidated on the Partnership's financial statements. Adjusted EBITDA from Equity-Accounted Vessels represents the Partnership's proportionate share of Adjusted EBITDA from its equity-accounted vessels. The Partnership does not have the unilateral ability to determine whether the cash generated by its equity-accounted vessels is retained within the entity in which the Partnership holds the equity-accounted investments or distributed to the Partnership and other owners. In addition, the Partnership does not control the timing of any such distributions to the Partnership and other owners. Adjusted EBITDA is a non-GAAP financial measure used by certain investors and management to measure the operational performance of companies. Please refer to Appendices C and E of this release for reconciliations of Adjusted EBITDA to net income (loss) and equity income, respectively, which are the most directly comparable GAAP measures reflected in the Partnerships consolidated financial statements.

Adjusted Net Income Attributableto the Partners and Preferred Unitholders excludes items of income or loss from GAAP net income (loss) that are typically excluded by securities analysts in their published estimates of the Partnerships financial results. The Partnership believes that certain investors use this information to evaluate the Partnerships financial performance, as does management. Please refer to Appendix A of this release for a reconciliation of this non-GAAP financial measure to net income (loss), and refer to footnote (2) of the Consolidated Statements of Income (Loss) for a reconciliation of adjusted equity income to equity income, the most directly comparable GAAP measure reflected in the Partnerships consolidated financial statements.

Distributable Cash Flow (DCF) represents GAAP net income (loss) adjusted for depreciation and amortization expense, deferred income tax and other non-cash items, estimated maintenance capital expenditures, unrealized gains and losses from non-designated derivative instruments, realized losses on interest rate swap termination, unrealized credit loss provisions, distributions relating to preferred units, adjustments for direct financing and sales-type leases to a cash basis, unrealized foreign currency exchange gains or losses, write-downs of vessels, gains or losses on sales of vessels, and the Partnerships proportionate share of such items in its equity-accounted for investments. Maintenance capital expenditures represent those capital expenditures required to maintain over the long-term the operating capacity of, or the revenue generated by, the Partnerships capital assets. DCF is a quantitative standard used in the publicly-traded partnership investment community and by management to assist in evaluating financial performance. Please refer to Appendix B of this release for a reconciliation of this non-GAAP financial measure to net income (loss), the most directly comparable GAAP measure reflected in the Partnerships consolidated financial statements.



Teekay LNG Partners L.P. Consolidated Statements of Income (Loss)(in thousands of U.S. Dollars, except unit and per unit data)

Three Months Ended March 31, December 31, March 31, 2021 2020 2020 (unaudited) (unaudited) (unaudited)Voyage revenues 152,802 154,076 139,887 Voyage expenses (7,183 ) (5,798 ) (2,317 )Vessel operating expenses (30,089 ) (31,243 ) (26,104 )Time-charter hire expenses (5,850 ) (6,294 ) (5,922 )Depreciation and amortization (31,902 ) (32,883 ) (32,639 )General and administrative expenses (7,167 ) (6,689 ) (6,167 )Write-down of vessels^(1) ? (6,000 ) (45,000 )Income from vessel operations 70,611 65,169 21,738 Equity income^(2) 37,516 15,359 373 Interest expense (29,652 ) (30,431 ) (36,704 )Interest income 2,006 1,411 2,370 Realized and unrealized gain (loss) onnon-designated derivative instruments^ 6,618 (3,020 ) (20,471 )(3)Foreign currency exchange gain (loss)^ 6,960 (6,618 ) 4,739 (4)Other expense^(^5^) (3,769 ) (1,721 ) (361 )Net income (loss) before income tax 90,290 40,149 (28,316 )expenseIncome tax recovery (expense) 777 (1,364 ) (2,512 )Net income (loss) 91,067 38,785 (30,828 ) Non-controlling interest in net income 3,476 3,643 2,166 Preferred unitholders' interest in net 6,425 6,427 6,425 incomeGeneral partner's interest in net income 1,426 504 (789 )(loss)Limited partners? interest in net income 79,740 28,211 (38,630 )(loss)Limited partners' interest in net income (loss) per common unit:? Basic 0.92 0.32 (0.50 )? Diluted 0.92 0.32 (0.50 )Weighted-average number of common units outstanding:? Basic 86,955,664 86,951,234 77,071,647 ? Diluted 87,091,656 87,077,496 77,071,647 Total number of common units outstanding 86,964,523 86,951,234 76,171,639 at end of period

During the three months ended December 31, 2020 and March 31, 2020, the Partnership wrote-down four and six wholly-owned multi-gas carriers,(1) respectively, to their estimated fair values. The total impairment charges of $6.0 million and $45.0 million were included in write-down of vessels for the three months ended December 31, 2020 and March 31, 2020, respectively. The Partnership?s proportionate share of items within equity income as identified in Appendix A of this release are detailed in the table below. By excluding these items from equity income, the Partnership believes the(2) resulting adjusted equity income is a normalized amount that can be used to better evaluate the financial performance of the Partnership?s equity-accounted investments. Adjusted equity income is a non-GAAP financial measure.

Three Months Ended March 31, December March 31, 31, 2021 2020 2020Equity income 37,516 15,359 373 Proportionate share of unrealized (gain) loss on (15,410 ) (4,214 ) 22,204 non-designated interest rate swapsProportionate share of write-down of vessels ? 17,000 ? Proportionate share of unrealized credit loss 6,677 2,989 8,980 provisionsProportionate share of other items (320 ) (669 ) (539 )Equity income adjusted for items in Appendix A 28,463 30,465 31,018

The realized losses on non-designated derivative instruments relate to the amounts the Partnership actually paid to settle non-designated derivative(3) instruments and the unrealized gains (losses) on non-designated derivative instruments relate to the change in fair value of such non-designated derivative instruments, as detailed in the table below:

Three Months Ended March 31, December March 31, 31, 2021 2020 2020Realized losses relating to: Interest rate swap agreements (4,473 ) (5,106 ) (2,911 )Interest rate swap agreement termination^(i) (18,012 ) ? ? Foreign currency forward contracts ? ? (241 ) (22,485 ) (5,106 ) (3,152 )Unrealized gains (losses) relating to: Interest rate swap agreements 29,103 2,086 (17,521 )Foreign currency forward contracts ? ? 202 29,103 2,086 (17,319 )Total realized and unrealized gains (losses) on 6,618 (3,020 ) (20,471 )non-designated derivative instruments

The termination of an interest rate swap agreement during the three (i) months ended March 31, 2021 was in connection with a debt refinancing completed in February 2021 at a lower all-in interest rate. For accounting purposes, the Partnership is required to revalue all foreign currency-denominated monetary assets and liabilities based on the prevailing exchange rates at the end of each reporting period. This(4) revaluation does not affect the Partnership?s cash flows or the calculation of distributable cash flow, but results in the recognition of unrealized foreign currency translation gains or losses in the Consolidated Statements of Income (Loss). Foreign currency exchange gain (loss) includes realized losses relating to the amounts the Partnership paid to settle the Partnership?s Norwegian Krone (NOK) denominated unsecured bonds and the associated non-designated cross currency swaps that were entered into as economic hedges in relation to the NOK denominated bonds. Foreign currency exchange gain (loss) also includes unrealized gains (losses) relating to the change in fair value of such derivative instruments and unrealized (losses) gain on the revaluation of the NOK bonds as detailed in the table below:

Three Months Ended March 31, December March 31, 31, 2021 2020 2020Realized losses on cross-currency swaps (1,345 ) (1,672 ) (1,817 )Unrealized gains (losses) on cross currency 5,129 29,001 (49,540 )swapsUnrealized (losses) gains on revaluation of NOK (1,189 ) (28,694 ) 53,973 bonds

Includes unrealized credit loss (provisions) reversals of $(3.7) million, $(5) (1.5) million and $0.1 million for the three months ended March 31, 2021, December 31, 2020 and March 31, 2020, respectively.

Teekay LNG Partners L.P.Consolidated Balance Sheets(in thousands of U.S. Dollars)

As at March As at 31, December 31, 2021 2020 (unaudited) (unaudited)ASSETS Current Cash and cash equivalents 163,480 206,762 Restricted cash ? current 5,702 8,358 Accounts receivable 15,100 7,631 Prepaid expenses 13,566 9,259 Current portion of derivative assets 124 ? Current portion of net investments in direct 14,022 13,969 financing leases, netCurrent portion of advances to equity-accounted joint 10,994 10,991 ventures, netAdvances to affiliates 6,844 4,924 Other current assets 237 237 Total current assets 230,069 262,131 Restricted cash ? long-term 39,034 42,823 Vessels and equipment At cost, less accumulated depreciation 1,209,622 1,220,355 Vessels related to finance leases, at cost, less 1,650,959 1,654,814 accumulated depreciationOperating lease right-of-use assets 17,357 20,750 Total vessels and equipment 2,877,938 2,895,919 Investments in and advances to equity-accounted joint 1,118,104 1,056,792 ventures, netNet investments in direct financing leases, net 492,027 500,101 Other assets 24,386 22,382 Derivative assets 9,532 4,505 Intangible assets, net 32,296 34,510 Goodwill 34,841 34,841 Total assets 4,858,227 4,854,004 LIABILITIES AND EQUITY Current Accounts payable 4,104 4,883 Accrued liabilities 71,512 81,706 Unearned revenue 23,700 30,254 Current portion of long-term debt 350,273 250,508 Current obligations related to finance leases 72,422 71,932 Current portion of operating lease liabilities 14,164 14,003 Current portion of derivative liabilities 26,047 56,925 Advances from affiliates 9,353 11,047 Total current liabilities 571,575 521,258 Long-term debt 1,094,044 1,221,705 Long-term obligations related to finance leases 1,250,647 1,268,990 Long-term operating lease liabilities 3,193 6,747 Other long-term liabilities 55,544 56,063 Derivative liabilities 30,293 32,971 Total liabilities 3,005,296 3,107,734 Equity Limited partners ? common units 1,523,746 1,465,408 Limited partners ? preferred units 285,159 285,159 General partner 47,225 46,182 Accumulated other comprehensive loss (61,375 ) (103,836 )Partners' equity 1,794,755 1,692,913 Non-controlling interest 58,176 53,357 Total equity 1,852,931 1,746,270 Total liabilities and total equity 4,858,227 4,854,004



Teekay LNG Partners L.P.Consolidated Statements of Cash Flows(in thousands of U.S. Dollars)

Three Months Ended March 31, March 31, 2021 2020 (unaudited) (unaudited)Cash and cash equivalents provided by (used for) OPERATING ACTIVITIES Net income (loss) 91,067 (30,828 )Non-cash and non-operating items: Unrealized (gain) loss on non-designated derivative (29,103 ) 17,319 instrumentsDepreciation and amortization 31,902 32,639 Write-down of vessels ? 45,000 Unrealized foreign currency exchange gain (9,982 ) (6,931 )Equity income, net of distributions received $16,500 (21,016 ) 6,127 (2020 ? $6,500)Amortization of deferred financing issuance costs 1,447 1,534 included in interest expenseChange in unrealized credit loss provisions included in 3,673 (100 )other expenseOther non-cash items (734 ) 1,587 Change in operating assets and liabilities: Receipts from direct financing and sales-type leases 3,585 264,072 Expenditures for dry docking (3,508 ) (1,191 )Other operating assets and liabilities (39,252 ) (495 )Net operating cash flow 28,079 328,733 FINANCING ACTIVITIES Proceeds from issuance of long-term debt 192,691 384,149 Scheduled repayments of long-term debt (117,897 ) (27,785 )Prepayments of long-term debt (96,543 ) (445,047 )Financing issuance costs (2,461 ) (2,601 )Scheduled repayments of obligations related to finance (17,853 ) (17,380 )leasesRepurchase of common units ? (15,635 )Cash distributions paid (28,552 ) (21,438 )Acquisition of non-controlling interest in certain of ? (2,219 )the Partnership's subsidiariesNet financing cash flow (70,615 ) (147,956 )INVESTING ACTIVITIES Expenditures for vessels and equipment (7,191 ) (7,830 )Net investing cash flow (7,191 ) (7,830 )(Decrease) increase in cash, cash equivalents and (49,727 ) 172,947 restricted cashCash, cash equivalents and restricted cash, beginning 257,943 253,291 of the periodCash, cash equivalents and restricted cash, end of the 208,216 426,238 period



Teekay LNG Partners L.P.Appendix A - Reconciliation of Non-GAAP Financial MeasuresAdjusted Net Income(in thousands of U.S. Dollars)

Three Months Ended March 31, December 31, March 31, 2021 2020 2020 (unaudited) (unaudited) (unaudited)Net income (loss) ? GAAP basis 91,067 38,785 (30,828 )Less: net income attributable to (3,476 ) (3,643 ) (2,166 )non-controlling interestsNet income (loss) attributable to the 87,591 35,142 (32,994 )partners and preferred unitholdersAdd (subtract) specific items affecting net income (loss):Write-down of vessels^(1) ? 6,000 45,000 Foreign currency exchange (gains) losses (8,305 ) 4,944 (6,556 )^(2)Unrealized credit loss provisions,unrealized (gains) and losses onnon-designated derivativeinstruments (9,053 ) 15,106 30,645 and other items from equity-accountedinvestees^(^3^)Unrealized (gains) losses onnon-designated derivative instruments (11,091 ) (2,086 ) 17,319 and realized loss from interest rateswap termination^(4)Unrealized credit loss provisions 823 174 (100 )(reversals) and other items^(5)Non-controlling interests? share of 501 698 (1,078 )items above^(^6^)Total adjustments (27,125 ) 24,836 85,230 Adjusted net income attributable to the 60,466 59,978 52,236 partners and preferred unitholders Preferred unitholders' interest in 6,425 6,427 6,425 adjusted net incomeGeneral partner's interest in adjusted 950 941 916 net incomeLimited partners? interest in adjusted 53,091 52,610 44,895 net incomeLimited partners? interest in adjusted 0.61 0.61 0.58 net income per common unit, basicWeighted-average number of common units 86,955,664 86,951,234 77,071,647 outstanding, basic

(1) See Note 1 to the Consolidated Statements of Income (Loss) included in this release for further details. Foreign currency exchange (gains) losses primarily relate to the Partnership?s revaluation of all foreign currency-denominated monetary assets and liabilities based on the prevailing exchange rate at the end of(2) each reporting period and unrealized losses (gains) losses on the cross-currency swaps economically hedging the Partnership?s NOK bonds. This amount excludes the realized losses relating to the cross currency swaps for the NOK bonds. See Note 4 to the Consolidated Statements of Income (Loss) included in this release for further details. Reflects the proportionate share of write-down of vessels, unrealized credit loss provisions and unrealized gains or losses due to changes in the(3) mark-to-market value of derivative instruments that are not designated as hedges for accounting purposes in the Partnership's equity-accounted investees. See Note 2 to the Consolidated Statements of Income (Loss) included in this release for further details. Reflects the unrealized (gains) losses due to changes in the mark-to-market value of the Partnership's derivative instruments that are not designated(4) as hedges for accounting purposes and realized losses related to interest rate swap agreement termination. See Note 3 to the Consolidated Statements of Income (Loss) included in this release for further details. Includes adjustments for unrealized credit loss provisions (reversals) (see(5) Note 5 to the Consolidated Statements of Income (Loss) included in this release for further details) and adjustments relating to changes in deferred tax balances. Items affecting net income include items from the Partnership?s consolidated non-wholly-owned subsidiaries. The specific items affecting net income are analyzed to determine whether any of the amounts originated from a consolidated non-wholly-owned subsidiary. Each amount that originates from a consolidated non-wholly-owned subsidiary is multiplied by(6) the non-controlling interests? percentage share in this subsidiary to arrive at the non-controlling interests? share of the amount. The amount identified as ?non-controlling interests? share of items above? in the table above is the cumulative amount of the non-controlling interests? proportionate share of the other specific items affecting net income listed in the table.



Teekay LNG Partners L.P.Appendix B - Reconciliation of Non-GAAP Financial Measures Distributable Cash Flow (DCF)(in thousands of U.S. Dollars, except units outstanding and per unit data)

Three Months Ended March 31, December 31, March 31, 2021 2020 2020 (unaudited) (unaudited) (unaudited) Net income (loss) 91,067 38,785 (30,828 )Add: Partnership?s share of equity-accountedjoint ventures' DCF net of estimated 36,356 38,511 39,542 maintenance capital expenditures^(1)Depreciation and amortization 31,902 32,883 32,639 Unrealized credit loss provisions 3,673 1,518 (100 )Direct financing and sales-type leasepayments received in excess of revenue 3,576 3,578 3,769 recognized and other adjustmentsWrite-down of vessels ? 6,000 45,000 Subtract: Deferred income tax and other non-cash (1,216 ) 3,723 1,098 itemsDistributions relating to preferred units (6,425 ) (6,427 ) (6,425 )Foreign currency exchange (gain) loss (8,305 ) 4,944 (6,556 )Unrealized (gains) losses onnon-designated derivative instruments and (11,091 ) (2,086 ) 17,319 realized loss from interest rate swapterminationEstimated maintenance capital (14,365 ) (14,683 ) (14,657 )expendituresEquity income (37,516 ) (15,359 ) (373 )Distributable Cash Flow before 87,656 91,387 80,428 non-controlling interestNon-controlling interests? share of DCFbefore estimated maintenance capital (5,637 ) (6,354 ) (5,551 )expendituresDistributable Cash Flow 82,019 85,033 74,877 Amount of cash distributions attributable (447 ) (389 ) (389 )to the General PartnerLimited partners' Distributable Cash Flow 81,572 84,644 74,488 Weighted-average number of common units 86,955,664 86,951,234 77,071,647 outstanding, basicDistributable Cash Flow per limited 0.94 0.97 0.97 partner common unit

The Partnership?s share of estimated maintenance capital expenditures(1) relating to its equity-accounted joint ventures were $15.1 million, $15.4 million and $15.2 million for the three months ended March 31, 2021, December 31, 2020 and March 31, 2020, respectively.



Teekay LNG Partners L.P.Appendix C - Reconciliation of Non-GAAP Financial MeasuresTotal Adjusted EBITDA (in thousands of U.S. Dollars)

Three Months Ended March 31, December March 31, 31, 2021 2020 2020 (unaudited) (unaudited) (unaudited)Net income (loss) 91,067 38,785 (30,828 )Depreciation and amortization 31,902 32,883 32,639 Interest expense, net of interest income 27,646 29,020 34,334 Income tax (recovery) expense (777 ) 1,364 2,512 EBITDA 149,838 102,052 38,657 Add (subtract) specific income statement items affecting EBITDA:Foreign currency exchange (gain) loss (6,960 ) 6,618 (4,739 )Other expense 3,769 1,721 361 Equity income (37,516 ) (15,359 ) (373 )Realized and unrealized (gain) loss on (6,618 ) 3,020 20,471 non-designated derivative instrumentsWrite-down of vessels ? 6,000 45,000 Direct financing and sales-type leasepayments received in excess of revenue 3,576 3,578 3,769 recognized and otheradjustmentsConsolidated adjusted EBITDA 106,089 107,630 103,146 Adjusted EBITDA from equity-accounted 78,198 82,598 85,242 vessels (See Appendix E)Total adjusted EBITDA 184,287 190,228 188,388



Teekay LNG Partners L.P.Appendix D - Reconciliation of Non-GAAP Financial MeasuresConsolidated Adjusted EBITDA by Segment(in thousands of U.S. Dollars)

Three Months Ended March 31, 2021 (unaudited) Liquefied Liquefied Natural Petroleum Total Gas Gas Segment SegmentVoyage revenues 141,416 11,386 152,802 Voyage expenses (2,129 ) (5,054 ) (7,183 )Vessel operating expenses (25,583 ) (4,506 ) (30,089 )Time-charter hire expenses (5,850 ) ? (5,850 )Depreciation and amortization (30,232 ) (1,670 ) (31,902 )General and administrative expenses (6,603 ) (564 ) (7,167 )Income (loss) from vessel operations 71,019 (408 ) 70,611 Depreciation and amortization 30,232 1,670 31,902 Direct financing and sales-type lease paymentsreceived in excess of revenue recognizedand 3,576 ? 3,576 other adjustmentsConsolidated adjusted EBITDA 104,827 1,262 106,089 Three Months Ended March 31, 2020 (unaudited) Liquefied Liquefied Natural Petroleum Total Gas Gas Segment SegmentVoyage revenues 132,570 7,317 139,887 Voyage expenses (1,029 ) (1,288 ) (2,317 )Vessel operating expenses (22,092 ) (4,012 ) (26,104 )Time-charter hire expenses (5,922 ) ? (5,922 )Depreciation and amortization (30,592 ) (2,047 ) (32,639 )General and administrative expenses (5,753 ) (414 ) (6,167 )Write-down of vessels ? (45,000 ) (45,000 )Income (loss) from vessel operations 67,182 (45,444 ) 21,738 Depreciation and amortization 30,592 2,047 32,639 Write-down of vessels ? 45,000 45,000 Direct financing and sales-type leasepaymentsreceived in excess of revenue 3,769 ? 3,769 recognizedand other adjustmentsConsolidated adjusted EBITDA 101,543 1,603 103,146



Teekay LNG Partners L.P. Appendix E - Reconciliation of Non-GAAP Financial MeasuresAdjusted EBITDA from Equity-Accounted Vessels(in thousands of U.S. Dollars)

Three Months Ended March 31, 2021 March 31, 2020 (unaudited) (unaudited) At Partnership's At Partnership's 100% Portion^(1) 100% Portion^(1)Voyage revenues 243,714 105,389 254,652 110,136 Voyage expenses (5,935 ) (2,948 ) (2,815 ) (1,354 )Vessel operating expenses,time-charter hire expenses (76,404 ) (33,346 ) (70,876 ) (31,629 )and general andadministrative expensesDepreciation and (24,710 ) (12,420 ) (25,613 ) (12,965 )amortizationIncome from vesseloperations of 136,665 56,675 155,348 64,188 equity-accounted vesselsNet interest expense (60,557 ) (24,474 ) (76,058 ) (30,493 )Income tax expense (780 ) (290 ) (598 ) (299 )Other items includingrealized and unrealizedgains (losses) on derivative 17,932 5,605 (102,927 ) (33,023 )instruments and unrealizedcredit loss provisionsNet income (loss) / equityincome of equity-accounted 93,260 37,516 (24,235 ) 373 vesselsNet income (loss) / equityincome of equity-accounted 83,939 32,939 (24,777 ) 182 LNG vesselsNet income / equity incomeof equity-accounted LPG 9,321 4,577 542 191 vessels Net income (loss) / equityincome of equity-accounted 93,260 37,516 (24,235 ) 373 vesselsDepreciation and 24,710 12,420 25,613 12,965 amortizationNet interest expense 60,557 24,474 76,058 30,493 Income tax expense 780 290 598 299 EBITDA from equity-accounted 179,307 74,700 78,034 44,130 vessels Add (subtract) specificincome statement items affecting EBITDA:Other items includingrealized and unrealized(gains) losses on derivative (17,932 ) (5,605 ) 102,927 33,023 instruments and unrealizedcredit loss provisionsDirect financing andsales-type lease payments 27,758 10,038 24,976 9,024 received in excess ofrevenue recognizedAmortization of in-process (1,719 ) (935 ) (1,718 ) (935 )contractsAdjusted EBITDA from 187,414 78,198 204,219 85,242 equity-accounted vesselsAdjusted EBITDA from 164,550 66,766 185,672 75,970 equity-accounted LNG vesselsAdjusted EBITDA from 22,864 11,432 18,547 9,272 equity-accounted LPG vessels

The Partnership's equity-accounted vessels for the three months ended March31, 2021 and 2020 include: the Partnership?s 40 percent ownership interest in Teekay Nakilat (III) Corporation, which owns four LNG carriers; the Partnership?s 50 percent ownership interest in the Partnership?s joint venture with Exmar NV (the Excalibur Joint Venture), which owns one LNG carrier; the Partnership?s 33 percent ownership interest in four LNG carriers servicing the Angola LNG project; the Partnership?s 52 percent(1) ownership interest in the MALT Joint Venture, which owns six LNG carriers; the Partnership?s 50 percent ownership interest in the Exmar LPG Joint Venture, which owns and in-charters 23 LPG carriers; the Partnership?s ownership interest ranging from 20 to 30 percent in four LNG carriers chartered to Shell (the Pan Union Joint Venture); the Partnership?s 50 percent ownership interest in six ARC7 LNG carriers in the Yamal LNG Joint Venture; and the Partnership's 30 percent ownership interest in the Bahrain LNG Joint Venture, which owns an LNG receiving and regasification terminal in Bahrain.



Teekay LNG Partners L.P.Appendix F - Summarized Financial Information of Equity-Accounted Joint Ventures(in thousands of U.S. Dollars)

As at March 31, 2021 As at December 31, 2020 (unaudited) (unaudited) At Partnership's At Partnership's 100% Portion^(1) 100% Portion^(1)Cash and restricted cash, 603,225 251,130 549,454 225,049 current and non-currentOther current assets 68,345 26,444 67,580 25,415 Property, plant andequipment, including ownedvessels, vessels related to 1,940,832 989,504 1,961,820 1,000,386 finance leases andoperating leaseright-of-use assetsNet investments insales-type and direct 5,340,428 2,061,087 5,384,652 2,077,707 financing leases, currentand non-currentDerivative assets 15,348 7,679 ? ? Other non-current assets 90,826 53,168 87,248 51,812 Total assets 8,059,004 3,389,012 8,050,754 3,380,369 Current portion oflong-term debt andobligations related to 304,859 129,603 306,185 129,538 finance leases andoperating leasesCurrent portion of 67,359 26,286 68,966 27,988 derivative liabilitiesOther current liabilities 187,783 79,304 164,266 65,311 Long-term debt andobligations related to 4,736,706 1,918,873 4,789,260 1,938,748 finance leases andoperating leasesShareholders' loans, 348,977 123,027 341,113 121,778 current and non-currentDerivative liabilities 167,496 68,208 280,480 112,922 Other long-term liabilities 73,427 33,895 70,743 33,353 Equity 2,172,397 1,009,816 2,029,741 950,731 Total liabilities and 8,059,004 3,389,012 8,050,754 3,380,369 equity Investments inequity-accounted joint 1,009,816 950,731 venturesAdvances toequity-accounted joint 123,027 121,778 venturesUnrealized credit loss (3,745 ) (4,726 )provisionsInvestments in andadvances, net toequity-accounted joint 1,129,098 1,067,783 ventures, current andnon-current

The Partnership's equity-accounted vessels as at March31, 2021 and December 31, 2020 include: the Partnership?s 40 percent ownership interest in Teekay Nakilat (III) Corporation, which owns four LNG carriers; the Partnership?s 50 percent ownership interest in the Excalibur Joint Venture, which owns one LNG carrier; the Partnership?s 33 percent ownership interest in four LNG carriers servicing the Angola LNG project; the Partnership?s 52 percent ownership interest in the MALT Joint Venture, which owns six LNG(1) carriers; the Partnership?s 50 percent ownership interest in the Exmar LPG Joint Venture, which owns and in-charters 23 LPG carriers; the Partnership?s ownership interest ranging from 20 percent to 30 percent in four LNG carriers chartered to Shell in the Pan Union Joint Venture; the Partnership?s 50 percent ownership interest in six ARC7 LNG carriers in the Yamal LNG Joint Venture; and the Partnership's 30 percent ownership interest in the Bahrain LNG Joint Venture, which owns an LNG receiving and regasification terminal in Bahrain.

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 managements current views with respect to certain future events and performance, including statements, among other things, regarding: the Partnerships ability to continue to generate strong earnings and cash flows despite market volatility and cyclicality; the counter-seasonal strength in LNG shipping rates and the Partnership's ability to derive benefits from any upside in market strength; the ability of the Partnership to fully utilize certain of its vessels; the ability of the Partnership to execute on its balanced capital allocation strategy including delevering of its balance sheet and returning capital to unitholders while pursuing growth, including expected increases in financial flexibility as a result of implementing such strategy; fixed charter coverage for the Partnership's LNG fleet for the remainder of 2021 and 2022; the ability of the Partnership to realize and receive the full benefits from its contractual backlog of revenue under its long-term charter contracts; the ability to continue to pay increased distributions on its common units; and the expected cash flows from, and the continued performance of, the Partnership's and its joint ventures' charter contracts.

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 LNG or LPG, either generally or in particular regions; changes in trading patterns or timing of start-up of new LNG liquefaction and regasification projects significantly affecting overall vessel tonnage requirements; changes in applicable industry laws and regulations and the timing of implementation of new laws and regulations; the potential for early termination of long-term contracts of existing vessels in the Partnership's fleet; higher than expected costs and expenses, including as a result of off-hire days or dry-docking requirements (both scheduled and unscheduled); delays in the Partnerships ability to successfully and timely complete dry dockings; general market conditions and trends, including spot, multi-month and multi-year charter rates; inability of customers of the Partnership or any of its joint ventures to make future payments under contracts; potential further delays to the formal commencement of commercial operations of the Bahrain Regasification Terminal; the inability of the Partnership to renew or replace long-term contracts on existing vessels; potential lack of cash flow to reduce balance sheet leverage or of excess capital available to allocate towards returning capital to unitholders; potential lack of cash flow to continue paying distributions on the Partnerships common units and other securities; and other factors discussed in Teekay LNG Partners filings from time to time with the SEC, including its Report on Form 20-F for the fiscal year ended December 31, 2020. The Partnership expressly disclaims any obligation to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Partnerships expectations with respect thereto or any change in events, conditions or circumstances on which any such statement is based.