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Overview

ICBC signs $682.8 million sale-leaseback agreement with Teekay LNG Partners L.P. for four LNG carrier newbuildings

Commitments (Constant USD, 2023)$744,744,690
Commitment Year•2016Country of Activity•Marshall IslandsDirect Recipient Country of Incorporation•Marshall IslandsSector•Transport And StorageFlow Type•Loan

Status

Project lifecycle

Pipeline: Commitment

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Dec 1, 2016
Start (planned)
Dec 31, 2016
Last repayment
Nov 29, 2026

Stakeholders

Organizations involved in projects and activities supported by financial and in-kind transfers from Chinese government and state-owned entities

Funding agencies

State-owned Commercial Banks

  • Industrial and Commercial Bank of China (ICBC)

Receiving agencies

Private Sector

  • Teekay LNG Partners L.P. (Seapeak LLC)

Loan desecription

ICBC signs $682.8 million sale-leaseback agreement with Teekay LNG Partners L.P. for four LNG carrier newbuildings

Interest type•UnknownMaturity•10 years

Narrative

Full Description

Project narrative

In December 2016, Teekay LNG Partners L.P., a company incorporated under the laws of the Republic of the Marshall Islands, entered into a 10-year $682.8 million sale-leaseback agreement with ICBC Financial Leasing Co., Ltd. (or ICBC Leasing) for four wholly-owned LNG carrier newbuildings equipped with the M-type, Electronically Controlled, Gas Injection (or MEGI) twin engines delivering in 2017 and 2018. At such dates, ICBC Leasing was expected t take delivery and charter each respective vessel back to Teekay LNG Partners. At the end of the 10-year tenor of these leases, Teekay LNG Partners had an obligation to repurchase the vessels from ICBC Leasing. The third vessel in the series is named the Torben Spirit, and was scheduled to be delivered in February 2017. The specific details of the deal are unknown.

Staff comments

1. Sale and leaseback (or sale-leaseback) agreements are generally considered to be off-balance-sheet hybrid debt products. 2. This deal could be related to the three sale-leaseback agreements between Teekay LNG Partners and ICBC signed on Dec 20, 2016: Agreement dated December 20, 2016 for a sale-leaseback agreement between DSME Hull No. 2416 L.L.C. and Hai Jiao 1605 Limited (a subsidiary of ICBC Financial Leasing Co., Ltd.); Agreement dated December 20, 2016 for a sale-leaseback agreement between DSME Option Vessel No.1 L.L.C. and Hai Jiao 1606 Limited (a subsidiary of ICBC Financial Leasing Co., Ltd.); and Agreement dated December 20, 2016 for a sale-leaseback agreement between DSME Option Vessel No.3 L.L.C. and Hai Jiao 1607 Limited (a subsidiary of ICBC Financial Leasing Co., Ltd.). However, there is no clear reference to ICBC in these agreements. This issue warrants further investigation.