TEEKAYTEEKAY

TEEKAY OFFSHORE PARTNERS INVESTOR DAY September 30, 2014

Photo Credit:

John Mikal Torgersen

2

KENNETH

HVID Chief Strategy Officer

2

3

Forward Looking Statements

This presentation 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. All statements included in or

accompanying this presentation, other than statements of historical fact, are forward-looking statements. Forward-looking statements are

not guarantees and actual results could differ materially from those expressed or implied in the forward-looking statements. Forward-

looking statements in this presentation include, among others, statements regarding: the fundamentals in and growth potential of the

offshore industry; future growth opportunities for the Partnership and its various segments, including the Partnership’s ability to participate

in new offshore projects or to grow organically; the accretive nature of any acquisitions and any future increases in the Partnership’s

distributable cash flows; the amount of the Partnership’s forward fee-rate revenues; estimated future total assets of the Partnership and its

segments; estimated capital expenditures for existing growth projects; illustrative annual distribution growth of the Partnership; the cost and

timing of delivery of new and converted vessels and commencement of their time-charter contracts; the timing of completion of operational

testing on the HiLoad DP vessel; the status, timing, cost and expected distributable cash flow to be generated from the potential acquisition

by the Partnership of the Knarr FPSO; the timing and certainty of entering into long-term financing and charter contracts for the FAU

newbuildings prior to their deliveries; the timing and certainty of the Partnership’s joint venture with Odebrecht completing negotiations for

the Libra FPSO project with Petrobras, and the expected related cost and charter period; expected additional project bidding by the

Partnership; the Partnership’s FPSO deal execution capacity; and the potential for Teekay Corporation or third parties to offer additional

vessels or projects to the Partnership and the Partnership agreeing to acquire such vessels or projects. 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: vessel operations and oil production volumes; significant changes in oil prices;

variations in expected levels of field maintenance; increased operating expenses; levels of oil production in the North Sea and Brazil

offshore fields; potential early termination of contracts; shipyard delivery or vessel conversion delays and cost overruns; failure by the

Partnership to secure financing or charter contracts for FAU newbuildings; changes in exploration, production and storage of offshore oil

and gas, either generally or in particular regions; delays in the commencement of time-charters; the inability to successfully complete the

operational testing of the HiLoad DP unit; failure of Teekay Corporation to offer to the Partnership additional vessels or of the Partnership

to acquire the Knarr FPSO unit; failure to complete negotiations with Petrobras for the Libra FPSO project; potential delays in the

commencement of operations of the Knarr FPSO unit; the Partnership’s ability to raise adequate financing to purchase additional assets;

and other factors discussed in the Partnership’s filings from time to time with the SEC, including its Report on Form 20-F for the fiscal year

ended December 31, 2013. 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.

4

Teekay Offshore Partners • Broadening our offshore service offering and growth potential

• Strong industry fundamentals will continue

• Two main business platforms:

○ Floating production

○ Offshore logistics

5

Strong

Industry

Fundamentals

Stable

Operating

Model

INVESTMENT

HIGHLIGHTS

Leading

Market

Positions

Strong,

Visible

Growth

$7.8 billion

of forward

fee-based

revenues

Deepwater

offshore oil

production is set

to double by 2025

Market leader in

harsh weather

FPSOs and

shuttle tankers

$3.2 billion

of built-in

growth

6

$

$3B Market Cap.

6% Distribution CAGR

Since IPO in 2006

2006

Fee-based Contracts

Blue-Chip Customers

54 Offshore Units

Teekay Offshore at a glance

Avg. contract

duration of 5.3

years (excluding options)

TEEKAY OFFSHORE AT A GLANCE

15% per annum

Total Shareholder

Return Since IPO

2014

7

Core Regions: Brazil & North Sea

North Sea • 19 shuttle tankers

• 6 FPSOs (2 TOO + 4 TK Corp)

• 2 FSOs

Brazil • 13 shuttle tankers + 1 Hi-Load

• 3 FPSOs + 1 future FPSO

• 1 future accommodation unit

Falcon Spirit FSO

Suksan Salamander FSO

Dampier Spirit FSO

Pattani Spirit FSO

8

80%

7%

13%

56% 37%

3% 4%

30%

49%

6% 2%

9% 4%

Teekay Offshore’s Business Mix Continues to Evolve

• Enhancing service offering to the customer

• With roll-off of conventional tanker contracts, Teekay Offshore is becoming a

true “pure-play” in the build-out of offshore crude oil production

Total Assets 2007

by Segment

Total

Assets

$2.0B

Total

Assets

$3.9B

Total

Assets

$7.1B*

Conventional Tankers FSOs Shuttle Tankers FPSOs FAUs Towage

Total Assets 2013

by Segment

Total Assets 2013 PF*

by Segment

* December 2013 pro forma to include known growth projects delivering through 2017.

9

Stable Portfolio of Fee-Based Contracts With Strong Customer Base

Forward Fee-Based Revenues

by Segment*

Average Remaining Contract Length

by Segment*

FPSO

FSO

Shuttle

Tankers

Conventional

Tankers

FAU

6 years

5 years

4 years

4 years

3 years

$7.8B Total Forward

Fee-Based

Revenues

* Excludes extension options and includes the Knarr FPSO which has been offered to Teekay Offshore

56%

31%

9% 3%

1%

10

Solidifying our Position in the Value Chain

FPSO

(Shipshape)

FSO

Floating

Accommodation

HiLoad DP Ocean

Towage FPSO

(Cylindrical)

Offshore

Production

Shuttle

Tankers

Offshore

Logistics

2. Responding to needs of our common customers

1. Strong fundamentals

3. Leveraging our competitive advantages

Teekay Offshore’s growth driven by:

4. Pursuit of higher returns

11 11

Providing Services to Meet Customers’ Offshore Oil Production Needs

TERMINAL

REFINERY

OFFSHORE UNITS

CONVENTIONAL

FLOATING

ACCOMMODATION

HI-LOAD

FSO

+

OFFSHORE

PLATFORM

OFFSHORE

PLATFORM

TOWAGE &

INSTALLATION

SHUTTLE

FPSO

12

Oil Production Moving Offshore With deepwater taking an increasing share

• The world needs 50 mb/d

of new oil by 2035 just to

offset existing field decline

• Easy-to-find oil is

disappearing; new supply

will increasingly come from

unconventional plays

• Deepwater offshore oil

production is set to double

by 2025

• Teekay’s core customers

are at the forefront of

these new developments

ExxonMobil Eni

Statoil

Noble

ExxonMobil Eni

Statoil

Noble

0

2

4

6

8

10

12

Mil

lio

n b

oe/d

Source: IHS

ExxonMobil Eni Statoil

Shell

BP

Total

Chevron

Petrobras

Others

Deepwater Oil Production by Company

13

Deepwater Accounts for 23% of New Production for the Top 26 IOCs

8%

20%

21% 23%

28% Oil Sands

Conventional Onshore

Conventional Shallow

Deepwater

Unconventional

7%

18%

19%

31%

25%

2020 New Production Sources

Top 26 IOCs Top 26 IOCs + Petrobras

Total

16 mb/d

Total

18 mb/d

Overall production volume growth of the top IOCs requires a balanced production portfolio,

despite an increased focus on unconventional sources by many Independents

Source: IHS

Rising to 31% when Petrobras is Added

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Growth Across Multiple Offshore Segments

Known Growth Capex

by Segment

FSO

2014

Dropdown

FPSOs

(Estimated)

2016 2015 2017

Towage

Vessels

Shuttle

/ Hi-Load

FAUs

49% 14%

2%

7%

19% 9%

$3.2B Known Growth

Projects

FPSO

15

Over 80% of Growth Capex Already Booked to Achieve Illustrative Growth Through 2017 Actively bidding on 2017 / 2018 Offshore projects and on-the-water

acquisitions to drive future distribution growth

-

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

2015 2016 2017 2018

An

nu

al

Cap

ital

Inv

estm

en

t ($

millio

ns)

TOO Growth CAPEX - Committed vs. Illustrative Target

Cumulative Capital Investments (Known)

Cumulative CAPEX Required for Illustrative Distribution Growth

TOO Known Annual Asset Deliveries

83% of Capex

to achieve

illustrative

growth already

committed

Illustrative Distribution Growth

7.5%

5%

5%

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Well Positioned to Capture Significant Share of Offshore Production Market Growth $80 billion market opportunity in our segments

$56 billion

0

10

20

30

40

50

60

70

80

90

100

0

20

40

60

80

100

120

140

160

180

200

Offshore UnitRequirement

Capex

$ B

illi

on

s

Nu

mb

er

of

un

its

FPSO FSO Shuttle FAU

Offshore Unit Demand 2015-2020

Source: Internal Estimates

$80B

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Core Regions: Brazil & North Sea

:

Current

Core

Markets

Potential

New

Markets

Southeast Asia Increase in

development of

smaller fields

West Africa Increasing

complexity of

offshore services

East Coast

Canada Expanding Shuttle

Region

Gulf of Mexico Growing demand

for offshore

services

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FLOATING

PRODUCTION,

STORAGE AND

OFFLOADING (FPSO)

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Strong Demand for FPSO Projects Brazil a key region for new FPSO demand

• The pace of FPSO projects is set to

increase during the next 5 years

• Brazil is at the forefront of new

FPSO demand

• Growing trend towards leased

instead of oil company owned units

40 34

15

15 20

Brazil

Africa

N. Europe

S.E. Asia

Others

Historical & Forecast FPSO Contracting

Planned FPSO Projects by Region

14

10 9 10

5 4

1

4

3 1

3

0

2

4

6

8

10

12

14

16

BWOffshore

SBM MODEC Teekay /TOO

BumiArmada

Bluewater

No

. V

essels

Leased FPSO Operators

Existing On Order

0

5

10

15

20

25

2009

2010

2011

2012

2013

2014E

2015E

2016E

2017E

2018E

2019E

2020E

Num

ber

of

Contr

acts

Source: Clarksons / Energy Maritime Associates

Forecast Historical

14-16 contract awards per year

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Current FPSO Fleet Contract Status

FPSO Unit

Centrica

2021 2020 2015 2016 2017 2018 2019 2022 2023 2024

Petrojarl Banff CNR TK

Hummingbird Spirit Options TK

Petrojarl Varg Talisman Options TOO

Voyageur Spirit E.ON Options TOO

Cidade de Rio das Ostras Petrobras Options TOO

Cidade de Itajai (50%) Petrobras TOO

Piranema Spirit Petrobras Options TOO

Libra (Conversion) (50%) Petrobras TOO

Petrojarl Knarr (Newbuilding) BG TK

Owner

Petrojarl I TK Evaluating opportunities for redeployment, or sale

Petrojarl Foinaven TK BP Extension

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Status of Dropdown FPSOs at Teekay Parent Remaining FPSOs targeted for dropdown to TOO by end-2016

FPSO Current Status Dropdown Trigger

Petrojarl Knarr • Preparing for field

installation

• Offer has been received from

Teekay Parent

Petrojarl Banff • Producing on field • Contract uplift commencing

Q1 2015

Hummingbird

Spirit

• Options on current

contract run through

March 2017

• Centrica to complete possible field

life extension analysis

• Enter into new long-term contract

based-on enhanced field life

Foinaven • Subsea issues causing

field to produce below

max. capacity

• Stabilize production and obtain

charterer’s approval to transfer

ownership to TOO

Petrojarl 1 • In lay-up

• Bidding on new long-term

contract (would require

upgrade), or

• Sale to third party

• Signing of suitable contract

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Knarr FPSO Status Update

• Arrived in Norway and preparing

for offshore installation

• Tow to field scheduled for early-

October – will then commence

mooring and riser installation

(weather dependent)

• Commissioning planned for

October to late-November

• On schedule to commence 10-year

charter to BG in December

• Expected to generate annual DCF*

of approximately $70 million

* Distributable Cash Flow is a non-GAAP measure used by certain investors to measure the

financial performance of Teekay Offshore and other master limited partnerships

22

23

Libra FPSO Status Update

• Expect to sign Letter of Intent

with Petrobras today

• Early Well Test unit

• 12-year contract commencing

early-2017

• 50% owned with our Brazilian

partner, Odebrecht Oil and Gas

• Total Capex: $485 million (50%

basis)

• FPSO conversion at Jurong

Shipyard in Singapore utilizing

1995-built TOO shuttle tanker,

Navion Norvegia

Libra field considered to be the

largest oil field in Brazil with

8-12B recoverable barrels

24

Strengthening FPSO Operational Leadership

Key Focus Areas Action

Continue to strengthen

the organization

Reorganized into stand-alone regional teams in

Aberdeen, Trondheim and Brazil and established a

permanent, Asia-based FPSO execution team

Increase access to

engineering and project

resources

Resource sharing agreements with Sevan and

Kanfa

Enhance risk mitigation Implemented a more rigorous risk management

process for tendering and execution of projects

Improve start-up and

field commissioning

processes

Installed and commissioned Banff successfully and

transferred the same installation and commissioning

team to Knarr

Achieve full production

capacity on all units

Restored full production capacity on Banff, Voyageur

and Foinaven

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“Target-Rich” FPSO Market Focused on core North Sea and Brazil markets

• Expect 55 new FPSO projects in next 5 years

• Human capacity to execute 2 - 3 new projects simultaneously

• Targeting FPSO projects of $500 million to $1 billion each

• High barriers to entry and few competitors in core markets

North Sea Brazil

• Expertise required in a highly-

regulated, harsh weather operational

environment

• Leading provider of FPSOs in the

North Sea

• Sevan solution more cost effective as

no turret required

• Local content requirements and project

size and complexity

• First-mover advantage on Libra oil field

• Partnership with Odebrecht

Expect to bid on 3 projects

in next 24 months

Expect to bid on 4 projects

in next 24 months

26

INGVILD

SAETHER President, Teekay

Shuttle and Offshore

Services

26

27

TOO’s Offshore Logistics Business

Hi-Load

Innovative

technology

Shuttle Tankers

Core of the

franchise

FSOs

High-return

conversions

Quality

and know-how

Long-haul Towage

Sevan

technology

FAUs

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Organization Structured for Growth

• Stavanger, Norway-based operations streamlined with an intense

focus on profitability:

○ Operating costs reduced by approximately 20% compared to three years

ago:

− Implemented Filipino manning program, reducing crew costs

○ G&A reduced by approximately 20%

− Eliminated middle management layer

○ Increased average revenues per ship day

• Restructured into a project-oriented organization to grow beyond

shuttle tankers

○ Applying core competencies in DP and offshore operations to FAUs, Long-

haul towage, Hi-Load units

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29

OFFSHORE

LOGISTICS: DP Offshore Loading

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30

Brazil Driving Demand for Offloading Solutions Includes a requirement for both DP shuttle tankers and Hi-Load units

• Brazil to drive the bulk of

new shuttle tanker demand

to 2020

• Replacement demand for

vessels 20+ years in the

North Sea

• Requirement for new

vessels East Coast

Canada

• ~$2-3 billion of shuttle

tanker opportunities

anticipated in

the next 5 years

34

25

5 2 3 2

3

2 1 0

5

10

15

20

25

30

35

40

TOO Knutsen Viken AET Lauritzen Tsakos

No

. V

essels

Shuttle Tankers

Existing On Order

0

5

10

15

20

25

30

35

North SeaCoA*

North SeaTC

East CoastCanada

Brazil** TOTAL

Nu

mb

er

of V

essels

Source: Internal Estimates

Estimated New Shuttle Tanker Requirement to 2020

*Includes replacement demand **Includes Hi-Load units

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Hi-Load Technology Enhances Our Offshore Loading Offering

• Enables conventional tankers to load

from offshore fields

○ Eliminates need for regional

transshipment

• Operational testing for Hi-Load #1

expected to be completed during Q4-14

○ Completed multiple loadings from an

offshore unit to a conventional tanker

• FEED Study with BG for future Brazil

operations to focus on direct crude

export using Suezmax and VLCC

tankers

31

32

Case Study: Scott Spirit Extended Well Tests

• Xcite - Bentley Field (UK – 2012)

○ Receiving up to 1000 m3/day

○ 100 days of operation

• Noble (Equitorial Guinea – 2013)

○ Remote area

○ Challenging logistics

○ 180 days of operation

• West Linapacan Field (Philippines – 2015)

○ Loading, storing, transportation

○ Signed LOI – final contract pending

○ Expected start up March 2015 for ~200 days

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33

OFFSHORE

LOGISTICS: Floating Storage and

Offtake (FSO)

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34

FSO Demand Growth Concentrated in Asia and North Sea

• Trend toward higher-valued

FSOs

○ Harsh-weather North Sea units

$300 to $500 million

○ Asia-based units $50 to

$100 million

• Pace of FSO demand expected

to increase in the next 5 years

0

2

4

6

8

10

12

14

16

S.E. Asia North Sea GoM MED Africa Brazil

Source: Energy Maritime Associates

Existing FSO markets for TOO

6 5

3 3 3

1 2

0

1

2

3

4

5

6

7

8

TOO Omni MODEC TradaMaritime

MISC

No

. V

essels

Leased FSO Operators

Existing

On Order / Future Conversion

Planned FSO Projects by Region

35

2017 – 2020 Prospects

Floating Storage: Short and Long-term Execution Plan

Gina Krog FSO Conversion

Commence conversion of 1995-

built Randgrid shuttle tanker

Commence 3-15 year

contract with Statoil

Premier Oil – Sea Lion Field

• Start up 2018/2019

• 25+ years field life

• Sevan 1.2M bbls

• Falkland Islands

• Combined package FSO, Shuttle

+ potentially Hi-Load

Xcite – Bentley Field

• Start up 2017/2018

• 30 + years field life

• Sevan 1M bbls

• UK sector

• Start up 2017

• 25+ years of field life

• Sevan 650K bbls

• UK sector

Maersk – Culzean Field

2015 2016/2017

36

OFFSHORE

LOGISTICS: Floating Accommodation

Units (FAU)

36

37

Growing Need for Floating Accommodation Strong demand for modern DP units to meet growth and replace older units

8 12 12 11 10 10 11 11 11 12

2 3 4 8 9 9 11 12

4 4 5 5 6

7 10 12 13 14

2

3 3 4

4

0

10

20

30

40

50

60

2009 2010 2011 2012 2013 2014E 2015E 2016E 2017E 2018E

No.

Units

FAU Supply / Demand Balance

Mexico Brazil North Sea RoW Supply Adjusted Supply*

*Adjusted to account for scrapping (30% of units aged 30+ years) & excluding low-spec units on order Source: Platou

24%

4%

12% 60%

Age Profile of FAU Fleet

0-4 years

5-9 years

25-29 years

30+ years

11

3 1 1

4

2

3 2 2

0

2

4

6

8

10

12

14

16

Prosafe Floatel TOO Cotemar GranEnergia

No

. V

essels

Floating Accommodation

Existing On Order

38

Key Benefits of Teekay Offshore FAUs

• Cylindrical Sevan design

provides high stability and uptime

○ Superior to semi-sub units

• Large storage capacity (water,

fuel, etc.)

• High variable deck load ○ +2,000 m2 deck space

• Important performance factors for

the customer: ○ Motion stability

○ Station keeping

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39

Short Term Response in Irregular Waves

Typical wave periods in

normal operating conditions

Teekay Offshore FAU has Superior Motion Characteristics

More Stable

Less Stable

TOO FAU

40

Attractive Returns from FAU Contracts in Key Regions

North Sea and UK Continental Shelf

• Typically shorter contract tenor (9 - 18

months)

• Seasonality opposite of shuttle tankers on

CoAs (higher field maintenance during

summer)

• Higher returns (5 - 6x EBITDA)

Mexico • Historically, long-

term contracts

(3 – 10 years)

Brazil • Medium-term contracts (3 – 5 years)

• Returns similar to other offshore production

assets (6 - 8x EBITDA)

41

FAU: Execution Plan

2015 2014 2016 - 2017

Rig #1

Complete construction and commence 3-year contract with Petrobras

Non-conditional options for an

additional 5 units

Will consider exercising options

based-on market conditions

Rig #2

Complete construction and tender for new contract

Rig #3

Complete construction and tender for new contract

2016 - 2017

42

OFFSHORE

LOGISTICS: Long-Haul Towage

42

43

Expect Strong Demand for DP Towage

• TOO is constructing four, DPII, 300-ton bollard pull, SX-157 Ulstein X-Bow

Design long-distance towing and anchor handling vessels delivering in 2016

○ Capable of operating at full load for 45 days without refuelling

○ Equipped with anchor handling capabilities required for mooring and

installation

• Gap in the market for units capable of both high-end towage and installation /

decommissioning

0

10

20

30

40

50

2013 2014 2015 2016 2017 2018 2019 2020

Forecast Installation Mobilisation Towage

Source: ABN Amro

Towage vessels required to 2020

44

TEEKAY OFFSHORE IS WELL-POSITIONED

• Leading market

positions

• Strong industry

fundamentals

• Stable operating model

• Strong, visible growth

44

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