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<SEC-DOCUMENT>0000945234-07-000383.txt : 20070516
<SEC-HEADER>0000945234-07-000383.hdr.sgml : 20070516
<ACCEPTANCE-DATETIME>20070515180129
ACCESSION NUMBER:		0000945234-07-000383
CONFORMED SUBMISSION TYPE:	424B5
PUBLIC DOCUMENT COUNT:		2
FILED AS OF DATE:		20070516
DATE AS OF CHANGE:		20070515

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			Teekay LNG Partners L.P.
		CENTRAL INDEX KEY:			0001308106
		STANDARD INDUSTRIAL CLASSIFICATION:	WATER TRANSPORTATION [4400]
		IRS NUMBER:				000000000
		STATE OF INCORPORATION:			1T
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		424B5
		SEC ACT:		1933 Act
		SEC FILE NUMBER:	333-137697
		FILM NUMBER:		07855289

	BUSINESS ADDRESS:	
		STREET 1:		BAYSIDE HOUSE, BAYSIDE EXECUTIVE PARK
		STREET 2:		WEST BAY ST. & BLAKE RD., PO BOX AP59212
		CITY:			NASSAU
		STATE:			C5
		ZIP:			0000000000
		BUSINESS PHONE:		242-502-8820

	MAIL ADDRESS:	
		STREET 1:		BAYSIDE HOUSE, BAYSIDE EXECUTIVE PARK
		STREET 2:		WEST BAY ST. & BLAKE RD., PO BOX AP59212
		CITY:			NASSAU
		STATE:			C5
		ZIP:			0000000000
</SEC-HEADER>
<DOCUMENT>
<TYPE>424B5
<SEQUENCE>1
<FILENAME>o36113xe424b5.htm
<DESCRIPTION>PROSPECTUS SUPPLEMENT
<TEXT>
<HTML>
<HEAD>
<TITLE>Prospectus Supplement</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="right" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<B>Filed Pursuant to Rule&nbsp;424(b)(5)</B>
</DIV>

<DIV align="right" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<B>Registration
No.&nbsp;<FONT style="white-space: nowrap">333-137697</FONT></B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<B>PROSPECTUS SUPPLEMENT (To Prospectus dated September&nbsp;29,
2006)</B>
</DIV>

<DIV align="center" style="font-size: 18.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>2,300,000 Common Units</B>
</DIV>

<DIV align="center" style="font-size: 18.0pt;color: #000000; background: #ffffff;">
<B>Representing Limited Partner Interests</B>
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<IMG src="o36113xo3611300.gif" alt="(TEEKAY LNG PARTNERS L.P. LOGO)">
</DIV>

<DIV align="center" style="font-size: 24.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Teekay LNG Partners L.P.</B>
</DIV>

<DIV align="center" style="font-size: 3.0pt;color: #000000; background: #ffffff; margin-top: 19pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 22%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Teekay LNG Partners L.P. is offering to sell 2,300,000 of our
common units, representing limited partner interests.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our common units are listed on the New York Stock Exchange under
the symbol &#147;TGP.&#148; The closing sales price of our
common units on the New York Stock Exchange on May&nbsp;14, 2007
was $38.43&nbsp;per common unit.
</DIV>

<DIV align="left" style="font-size: 12.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Investing in our common units involves risks. See &#147;Risk
Factors&#148; beginning on page&nbsp;S-5 of this prospectus
supplement and page&nbsp;7 of the accompanying prospectus before
you make an investment in our common units.</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10.0pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="69%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="11%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>

<TR style="font-size: 8.0pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>Per Common</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 8.0pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>Unit</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>Total</B></TD><TD></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Public offering price</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom"><B>$</B></TD>
    <TD align="right" valign="bottom" nowrap><B>38.1300</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom"><B>$</B></TD>
    <TD align="right" valign="bottom" nowrap><B>87,699,000</B></TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Underwriting discount</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom"><B>$</B></TD>
    <TD align="right" valign="bottom" nowrap><B>1.3822</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom"><B>$</B></TD>
    <TD align="right" valign="bottom" nowrap><B>3,179,060</B></TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Proceeds to us (before expenses)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom"><B>$</B></TD>
    <TD align="right" valign="bottom" nowrap><B>36.7478</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom"><B>$</B></TD>
    <TD align="right" valign="bottom" nowrap><B>84,519,940</B></TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or determined if this prospectus supplement or the
accompanying prospectus are truthful or complete. Any
representation to the contrary is a criminal offense.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have granted the underwriters an option to purchase up to
345,000 additional common units to cover over-allotments
exercisable at any time until 30&nbsp;days after the date of
this prospectus.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The underwriters expect to deliver the common units on or about
May&nbsp;18, 2007.
</DIV>

<DIV align="center" style="font-size: 3.0pt;color: #000000; background: #ffffff; margin-top: 17pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 22%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="center" style="font-size: 18.0pt;color: #000000; background: #ffffff; margin-top: 10pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Wachovia Securities</B>
</DIV>

<DIV align="center" style="font-size: 3.0pt;color: #000000; background: #ffffff; margin-top: 17pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 22%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="center" style="font-size: 18.0pt;color: #000000; background: #ffffff; margin-top: 10pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Citi</B>
</DIV>

<DIV align="center" style="font-size: 18.0pt;color: #000000; background: #ffffff;">
<B>Raymond James</B>
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The date of this prospectus supplement is May&nbsp;15, 2007.
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
This document is in two parts. The first part is this prospectus
supplement, which describes the specific terms of this offering
of common units. The second part is the accompanying prospectus,
which gives more general information, some of which may not
apply to this offering of common units. Generally, when we refer
to the &#147;prospectus,&#148; we refer to both parts combined.
If information varies between this prospectus supplement and the
accompanying prospectus, you should rely on the information in
this prospectus supplement.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
You should rely only on the information contained or
incorporated by reference in this prospectus. We have not
authorized anyone to provide you with different information. If
anyone provides you with additional, different or inconsistent
information, you should not rely on it. You should not assume
that the information contained in this prospectus, as well as
the information we previously filed with the Securities and
Exchange Commission, or SEC, that is incorporated by reference
herein, is accurate as of any date other than its respective
date. Our business, financial condition, results of operations
and prospects may have changed since such dates.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are offering to sell the common units, and are seeking offers
to buy the common units, only in jurisdictions where offers and
sales are permitted. The distribution of this prospectus and the
offering of the common units in certain jurisdictions may be
restricted by law. Persons outside the United States who come
into possession of this prospectus must inform themselves about
and observe any restrictions relating to the offering of the
common units and the distribution of this prospectus outside the
United States. This prospectus does not constitute, and may not
be used in connection with, an offer or solicitation by anyone
in any jurisdiction in which such offer or solicitation is not
authorized or in which the person making such offer or
solicitation is not qualified to do so or to any person to whom
it is unlawful to make such offer or solicitation.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">S-i

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<!-- TOC -->
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name="tocpage"></A>
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>TABLE OF CONTENTS</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10.0pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="86%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>

<TR>
    <TD colspan="5" align="center" valign="top">
    <B>Prospectus Supplement</B></TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#201'>Where You Can Find More Information</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>S-1</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#202'>Incorporation of Documents by Reference</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>S-1</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#203'>Forward Looking Statements</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>S-2</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#204'>Summary</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>S-3</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#205'>Risk Factors</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>S-5</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#206'>Use of Proceeds</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>S-5</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#207'>Capitalization</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>S-6</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#208'>Price Range of Common Units and
    Distributions</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>S-7</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#209'>Tax Consequences</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>S-8</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#210'>Underwriting</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>S-12</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#211'>Service of Process and Enforcement of Civil
    Liabilities</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>S-15</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#212'>Legal Matters</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>S-16</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#213'>Experts</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>S-16</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#214'>Expenses</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>S-16</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>

<TR>
    <TD colspan="5" align="center" valign="top">
    <B>Prospectus</B></TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#101'>About This Prospectus</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#102'>Teekay LNG Partners L.P.&nbsp;</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#104'>Teekay LNG Finance Corp.&nbsp;</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#105'>Subsidiary Guarantors</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#106'>Where You Can Find More Information</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#107'>Forward-Looking Statements</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#108'>Risk Factors</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#114'>Use of Proceeds</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#115'>Ratio of Earnings To Fixed Charges</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#177'>Price Range of Common Units and
    Distributions</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>31</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#116'>Description of The Common Units</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>32</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#125'>Cash Distributions</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>37</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#136'>Description of Debt Securities</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>47</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#157'>Material U.S.&nbsp;Federal Income Tax
    Considerations</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>58</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#169'>Non-United States Tax Consequences</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>75</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#172'>Plan Of Distribution</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>77</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#173'>Service of Process and Enforcement of Civil
    Liabilities</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>79</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#174'>Legal</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>79</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#175'>Experts</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>79</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#176'>Expenses</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>80</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<!-- /TOC -->
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">S-ii

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='201'></A>
</DIV>

<!-- link1 "WHERE YOU CAN FIND MORE INFORMATION" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>WHERE YOU CAN FIND MORE INFORMATION</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have filed with the SEC a registration statement on
Form&nbsp;<FONT style="white-space: nowrap">F-3</FONT> regarding
the securities covered by this prospectus. This prospectus does
not contain all of the information found in the registration
statement. For further information regarding us and the
securities offered in this prospectus, you may wish to review
the full registration statement, including its exhibits. In
addition, we file annual, quarterly and other reports with and
furnish information to the SEC. You may inspect and copy any
document we file with or furnish to the SEC at the public
reference facilities maintained by the SEC at 100 F Street, NE,
Washington,&nbsp;D.C. 20549. Copies of this material can also be
obtained upon written request from the Public Reference Section
of the SEC at 100 F Street, NE, Washington,&nbsp;D.C. 20549, at
prescribed rates or from the SEC&#146;s web site on the Internet
at <U>www.sec.gov</U> free of charge. Please call the SEC at
<FONT style="white-space: nowrap">1-800-SEC-0330</FONT> for
further information on public reference rooms. You can also
obtain information about us at the offices of the New York Stock
Exchange, Inc., 20&nbsp;Broad Street, New York, New York 10005.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As a foreign private issuer, we are exempt under the Securities
Exchange Act from, among other things, certain rules prescribing
the furnishing and content of proxy statements, and our
executive officers, directors and principal unitholders are
exempt from the reporting and short-swing profit recovery
provisions contained in Section&nbsp;16 of the Exchange Act. In
addition, we are not required under the Exchange Act to file
periodic reports and financial statements with the SEC as
frequently or as promptly as U.S.&nbsp;companies whose
securities are registered under the Exchange Act, including the
filing of quarterly reports or current reports on
Form&nbsp;<FONT style="white-space: nowrap">8-K.</FONT> However,
we intend to make available quarterly reports containing our
unaudited interim financial information for the first three
fiscal quarters of each fiscal year.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='202'></A>
</DIV>

<!-- link1 "INCORPORATION OF DOCUMENTS BY REFERENCE" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>INCORPORATION OF DOCUMENTS BY REFERENCE</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The SEC allows us to &#147;incorporate by reference&#148;
information that we file with the SEC. This means that we can
disclose important information to you without actually including
the specific information in this prospectus by referring you to
other documents filed separately with the SEC. The information
incorporated by reference is an important part of this
prospectus. Information that we later provide to the SEC, and
which is deemed to be &#147;filed&#148; with the SEC,
automatically will update information previously filed with the
SEC, and may replace information in this prospectus.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We incorporate by reference into this prospectus the documents
listed below:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our Annual Report on
    Form&nbsp;<FONT style="white-space: nowrap">20-F</FONT> for the
    fiscal year ended December&nbsp;31, 2006;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our current Report on
    Form&nbsp;<FONT style="white-space: nowrap">6-K</FONT> filed on
    May&nbsp;14, 2007 that we identify in such Report as being
    incorporated by reference into the registration statement of
    which this prospectus is a part;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    all subsequent Reports on
    Form&nbsp;<FONT style="white-space: nowrap">6-K</FONT> filed
    prior to the termination of this offering that we identify in
    such Reports as being incorporated by reference into the
    registration statement of which this prospectus is a
    part;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the description of our common units contained in our
    Registration Statement on
    Form&nbsp;<FONT style="white-space: nowrap">8-A/</FONT> A filed
    on September&nbsp;29, 2006, including any subsequent amendments
    or reports filed for the purpose of updating such description.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
These reports contain important information about us, our
financial condition and our results of operations.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
You may obtain any of the documents incorporated by reference in
this prospectus from the SEC through its public reference
facilities or its website at the addresses provided above. You
also may request a copy of any document incorporated by
reference in this prospectus (excluding any exhibits to those
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">S-1

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
documents, unless the exhibit is specifically incorporated by
reference in this document), at no cost by visiting our internet
website at www.teekaylng.com, or by writing or calling us at the
following address:
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
Teekay LNG Partners L.P.
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
Bayside House, Bayside Executive Park
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
West Bay Street and Blake Road
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
P.O. Box&nbsp;<FONT style="white-space: nowrap">AP-59212</FONT>
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
Nassau, Commonwealth of the Bahamas
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
Attn: Corporate Secretary
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
(242)&nbsp;<FONT style="white-space: nowrap">502-8820</FONT>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
You should rely only on the information incorporated by
reference or provided in this prospectus or any prospectus
supplement. We have not authorized anyone else to provide you
with any information. You should not assume that the information
incorporated by reference or provided in this prospectus or any
prospectus supplement is accurate as of any date other than the
date on the front of each document.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='203'></A>
</DIV>

<!-- link1 "FORWARD-LOOKING STATEMENTS" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>FORWARD-LOOKING STATEMENTS</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
All statements, other than statements of historical fact,
included in or incorporated by reference into this prospectus
are forward-looking statements. In addition, we and our
representatives may from time to time make other oral or written
statements that are also forward-looking statements. Such
statements include, in particular, statements about our plans,
strategies, business prospects, changes and trends in our
business, and the markets in which we operate. In some cases,
you can identify the forward-looking statements by the use of
words such as &#147;may,&#148; &#147;will,&#148;
&#147;could,&#148; &#147;should,&#148; &#147;would,&#148;
&#147;expect,&#148; &#147;plan,&#148; &#147;anticipate,&#148;
&#147;intend,&#148; &#147;forecast,&#148; &#147;believe,&#148;
&#147;estimate,&#148; &#147;predict,&#148; &#147;propose,&#148;
&#147;potential,&#148; &#147;continue&#148; or the negative of
these terms or other comparable terminology. Forward-looking
statements include statements with respect to, among other
things, those set forth in the section titled &#147;Tax
Consequences&#148; in this prospectus supplement, including with
respect to ratio of taxable income to distributions.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
These and other forward-looking statements are subject to risks,
uncertainties and assumptions, including those risks discussed
in &#147;Risk Factors&#148; set forth in the prospectus and
those risks discussed in other reports we file with the SEC and
that are incorporated in this prospectus by reference. The
risks, uncertainties and assumptions involve known and unknown
risks and are inherently subject to significant uncertainties
and contingencies, many of which are beyond our control.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Forward-looking statements are made based upon management&#146;s
current plans, expectations, estimates, assumptions and beliefs
concerning future events affecting us and, therefore, involve a
number of risks and uncertainties, including those risks
discussed in &#147;Risk Factors&#148; and otherwise incorporated
into this prospectus. We caution that forward-looking statements
are not guarantees and that actual results could differ
materially from those expressed or implied in the
forward-looking statements.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We undertake no obligation to update any forward-looking
statement to reflect events or circumstances after the date on
which such statement is made or to reflect the occurrence of
unanticipated events. New factors emerge from time to time, and
it is not possible for us to predict all of these factors.
Further, we cannot assess the effect of each such factor on our
business or the extent to which any factor, or combination of
factors, may cause actual results to be materially different
from those contained in any forward-looking statement.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">S-2

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<DIV style="width: 100%; border: 1px solid black; padding: 12px;">

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='204'></A>
</DIV>

<!-- link1 "SUMMARY" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>SUMMARY</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>The following summary highlights selected information
contained elsewhere in this prospectus and the documents
incorporated by reference herein and does not contain all the
information you will need in making your investment decision.
You should carefully read this entire prospectus supplement, the
accompanying prospectus and the documents incorporated by
reference herein.</I>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Unless otherwise indicated, references in this prospectus to
&#147;Teekay LNG Partners,&#148; &#147;we,&#148; &#147;us&#148;
and &#147;our&#148; and similar terms refer to Teekay LNG
Partners L.P. and/or one or more of its subsidiaries, except
that those terms, when used in this prospectus in connection
with the common units described herein, shall mean specifically
Teekay LNG Partners L.P. References in this prospectus to
&#147;Teekay Shipping Corporation&#148; refer to Teekay Shipping
Corporation and/or any one or more of its subsidiaries.</I>
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Overview</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are an international provider of marine transportation
services for liquefied natural gas (or <I>LNG</I>), liquefied
petroleum gas (or <I>LPG</I>) and crude oil. We were formed on
November&nbsp;3, 2004 by Teekay Shipping Corporation, the
world&#146;s largest owner and operator of medium-sized crude
oil tankers, to expand its operations in the LNG shipping
sector. Our primary growth strategy focuses on expanding our
fleet of LNG carriers under long-term, fixed-rate charters. In
December 2006, we announced that we would be acquiring four LPG
carriers. LPG is a by-product of natural gas separation and
crude oil refining. We believe LPG transportation services are a
natural extension of our core LNG transportation business. We
view our Suezmax tanker fleet primarily as a source of stable
cash flow as we expand our LNG and LPG operations. Our fleet,
excluding newbuildings, currently consists of seven LNG
carriers, eight Suezmax class crude oil tankers and one LPG
carrier, all of which are double-hulled. We seek to leverage the
expertise, relationships and reputation of Teekay Shipping
Corporation and its affiliates to pursue growth opportunities in
the LNG and LPG shipping sector. As of December&nbsp;31, 2006,
Teekay Shipping Corporation, which beneficially owns and
controls our general partner, beneficially owned a 67.8%
interest in us, including a 2% general partner interest.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our operations are conducted through, and our operating assets
are owned by, our subsidiaries. We own our interests in our
subsidiaries through our 100% ownership interest in our
operating company, Teekay LNG Operating L.L.C., a Marshall
Islands limited liability company. Our general partner, Teekay
GP L.L.C., a Marshall Islands limited liability company, has an
economic interest in us and manages our operations and
activities. Our general partner does not receive any management
fee or other compensation in connection with its management of
our business, but it is entitled to be reimbursed for all direct
and indirect expenses incurred on our behalf.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are incorporated under the laws of the Republic of The
Marshall Islands as Teekay LNG Partners L.P. and maintain our
principal executive headquarters at Bayside House, Bayside
Executive Park, West Bay Street&nbsp;&#38; Blake Road, P.O.
Box&nbsp;AP-59212, Nassau, The Bahamas. Our telephone number at
such address is (242)&nbsp;502-8820. Our website address is
www.teekaylng.com. The information contained on our website is
not part of this prospectus supplement.
</DIV>
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">S-3

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<DIV style="width: 100%; border: 1px solid black; padding: 12px;">

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>The Offering</B>
</DIV>

<DIV style="margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="26%"></TD>
    <TD width="1%"></TD>
    <TD width="73%"></TD>
</TR>

<TR>
    <TD valign="top">
    Issuer</TD>
    <TD></TD>
    <TD valign="top">
    Teekay LNG Partners L.P.</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    Common Units Offered by Us</TD>
    <TD></TD>
    <TD valign="top">
    2,300,000 common units.</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="top">
    2,645,000 common units if the underwriters exercise their option
    to purchase an additional 345,000 common units to cover
    over-allotments.</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    Units Outstanding After this Offering</TD>
    <TD></TD>
    <TD valign="top">
    22,540,547 common units and 14,734,572 subordinated units.
    22,885,547 common units and 14,734,572 subordinated units, if
    the underwriters exercise their over-allotment option in full.</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    Use of Proceeds</TD>
    <TD></TD>
    <TD valign="top">
    We will use the net proceeds from our sale of common units to
    repay amounts outstanding on one of our revolving credit
    facilities and for general partnership purposes.</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    Estimated ratio of taxable income to distributions</TD>
    <TD></TD>
    <TD valign="top">
    We estimate that if you hold the common units you purchase in
    this offering through December&nbsp;31, 2009, you will be
    allocated, on a cumulative basis, an amount of U.S.&nbsp;federal
    taxable income for that period that will be 20% or less of the
    cash distributed to you with respect to that period. For
    example, if you receive an annual distribution of $1.85&nbsp;per
    unit, we estimate that your allocable U.S.&nbsp;federal taxable
    income per year will be no more than $0.37&nbsp;per unit. For a
    discussion of the basis for this estimate and of factors that
    may affect our ability to achieve this estimate, please read
    &#147;Tax Consequences&nbsp;&#151; Ratio of Taxable Income to
    Distributions.&#148;</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">S-4

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='205'></A>
</DIV>

<!-- link1 "RISK FACTORS" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>RISK FACTORS</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Before investing in our common units, you should carefully
consider all of the information included or incorporated by
reference into this prospectus. Although many of our business
risks are comparable to those of a corporation engaged in a
similar business, limited partner interests are inherently
different from the capital stock of a corporation. When
evaluating an investment in our common units, you should
carefully consider those risks discussed under the caption
&#147;Risk Factors&#148; beginning on page&nbsp;7 of the
accompanying prospectus, as well as the discussion of risk
factors beginning on page&nbsp;10 of our Annual Report on
Form&nbsp;<FONT style="white-space: nowrap">20-F</FONT> for the
fiscal year ended December&nbsp;31, 2006 and on page&nbsp;5 of
our current Report on
Form&nbsp;<FONT style="white-space: nowrap">6-K</FONT> filed
May&nbsp;14, 2007, which are incorporated by reference into this
prospectus. If any of these risks were to occur, our business,
financial condition or operating results could be materially
adversely affected. In that case, our ability to pay
distributions on our common units may be reduced, the trading
price of our common units could decline, and you could lose all
or part of your investment.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='206'></A>
</DIV>

<!-- link1 "USE OF PROCEEDS" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>USE OF PROCEEDS</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We will receive net proceeds of approximately $84.2&nbsp;million
from the sale of the common units we are offering after
deducting the underwriting discounts and estimated expenses
payable by us. We expect to receive net proceeds of
approximately $96.9&nbsp;million if the underwriter&#146;s
option to acquire additional common units is exercised in full.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We will use the net proceeds from our sale of common units
covered by this prospectus to repay outstanding debt on one of
our revolving credit facilities, which has a fluctuating
interest rate based on the London Interbank Offered Rate
(LIBOR)&nbsp;plus 0.50%. The credit facility matures on
April&nbsp;7, 2015. We will be able to redraw the amount we
repaid on the facility in the future for any general partnership
purpose or to fund acquisitions.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">S-5

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='207'></A>
</DIV>

<!-- link1 "CAPITALIZATION" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>CAPITALIZATION</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table sets forth our capitalization as of
March&nbsp;31, 2007 on an historical basis and on an as adjusted
basis to give effect to this offering and the application of the
net proceeds therefrom including the contribution by Teekay GP
L.L.C., our general partner, to maintain its 2% general partner
interest in us.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The historical data in the table is derived from and should be
read in conjunction with our historical financial statements,
including accompanying notes, incorporated by reference in this
prospectus. You should also read this table in conjunction with
the section entitled &#147;Management&#146;s Discussion and
Analysis of Financial Condition and Results of Operations&#148;
and our consolidated financial statements and the related notes
thereto, which are incorporated by reference herein from our
Annual Report on
Form&nbsp;<FONT style="white-space: nowrap">20-F</FONT> for the
fiscal year ended December&nbsp;31, 2006. This table does not
reflect the issuance of up to 345,000 common units that we may
sell to the underwriters upon exercise of their over-allotment
option.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10.0pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="61%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
</TR>


<TR style="font-size: 8.0pt;">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>As of March&nbsp;31, 2007</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8.0pt;">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Actual</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>As Adjusted</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8.0pt;">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>(In thousands)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash and Cash Equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>35,407</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>35,407</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Restricted cash(1)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>757,851</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>757,851</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total cash and restricted cash</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>793,258</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>793,258</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Long-term debt, including current portion:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Long-term debt</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>1,147,807</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>1,061,812</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Long-term obligation under capital leases(1)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>871,635</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>871,635</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total long-term debt</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>2,019,442</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>1,933,447</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Minority interest</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>165,675</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>165,675</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Equity:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Partners&#146; Equity</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>706,614</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>792,609</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total capitalization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>2,891,731</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>2,891,731</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 3.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    Under certain capital lease arrangements, we maintain restricted
    cash deposits that, together with interest earned on the
    deposits, will equal the remaining scheduled payments we owe
    under the capital leases. The interest we receive from those
    deposits is used solely to pay interest associated with the
    capital leases, and the amount of interest we receive
    approximates the amount of interest we pay on the capital leases.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">S-6

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='208'></A>
</DIV>

<!-- link1 "PRICE RANGE OF COMMON UNITS AND DISTRIBUTIONS" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>PRICE RANGE OF COMMON UNITS AND DISTRIBUTIONS</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our common units were first offered on the New York Stock
Exchange on May&nbsp;5, 2005, at an initial price of
$22.00&nbsp;per unit. Our common units are listed for trading on
the New York Stock Exchange under the symbol &#147;TGP.&#148;
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table sets forth, for the periods indicated, the
high and low closing sales price per common unit, as reported on
the New York Stock Exchange, and the amount of quarterly cash
distributions declared per unit. The closing sales price of our
common units on the New York Stock Exchange on May&nbsp;14, 2007
was $38.43&nbsp;per common unit.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10.0pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="60%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
</TR>


<TR style="font-size: 8.0pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Closing Sales</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 8.0pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Price Ranges</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 8.0pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Quarterly Cash</B></TD>
</TR>

<TR style="font-size: 8.0pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>High</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Low</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Distributions(1)</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Years Ended</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    December&nbsp;31, 2006</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>34.23</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>28.65</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    December&nbsp;31, 2005(2)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>34.70</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>24.30</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="14">&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Quarters Ended</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    June&nbsp;30, 2007(3)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>39.94</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>37.50</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    March&nbsp;31, 2007</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>38.08</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>32.70</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>0.4625</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    December&nbsp;31, 2006</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>34.23</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>30.00</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>0.4625</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    September&nbsp;30, 2006</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>31.47</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>29.35</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>0.4625</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    June&nbsp;30, 2006</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>31.98</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>29.13</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>0.4625</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    March&nbsp;31, 2006</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>31.69</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>28.65</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>0.4625</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    December&nbsp;31, 2005</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>31.66</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>37.40</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>0.4125</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    September&nbsp;30, 2005</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>34.70</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>28.12</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>0.4125</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    June&nbsp;30, 2005(2)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>28.45</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>24.30</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>0.2357</TD>
    <TD align="left" valign="bottom" nowrap>(4)</TD>
</TR>

<TR>
    <TD colspan="14">&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Months Ended</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    May&nbsp;14, 2007(3)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>38.71</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>38.01</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    April&nbsp;30, 2007</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>39.94</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>37.46</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    March&nbsp;31, 2007</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>37.68</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>36.41</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    February&nbsp;28, 2007</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>38.08</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>34.55</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    January&nbsp;31, 2007</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>33.97</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>32.70</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    December&nbsp;31, 2006</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>34.23</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>31.35</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 3.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    Distributions are shown for the quarter with respect to which
    they were declared. Cash distributions were declared and paid
    within 45&nbsp;days following the close of each quarter.</TD>
</TR>

<TR>
    <TD style="font-size: 3.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(2)&nbsp;</TD>
    <TD align="left">
    Period beginning May&nbsp;5, 2005.</TD>
</TR>

<TR>
    <TD style="font-size: 3.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(3)&nbsp;</TD>
    <TD align="left">
    Through May&nbsp;14, 2007.</TD>
</TR>

<TR>
    <TD style="font-size: 3.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(4)&nbsp;</TD>
    <TD align="left">
    The distribution reflects the
    <FONT style="white-space: nowrap">52-day</FONT> period from
    May&nbsp;10, 2005 to June&nbsp;30, 2005.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">S-7

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='209'></A>
</DIV>

<!-- link1 "TAX CONSEQUENCES" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>TAX CONSEQUENCES</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The tax consequences to you of an investment in our common units
will depend in part on your own tax circumstances. For a
discussion of the principal U.S.&nbsp;federal income tax
considerations and
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>federal
income tax considerations associated with our operations and the
purchase, ownership and disposition of our common units, please
read &#147;Material U.S.&nbsp;Federal Income Tax
Consequences,&#148; beginning on page&nbsp;58, and
&#147;Non-United States Tax Consequences,&#148; beginning on
page&nbsp;75, of the accompanying base prospectus. You are urged
to consult with your own tax advisor about the federal, state,
local and foreign tax consequences peculiar to your
circumstances. In addition to the discussion set forth in the
accompanying base prospectus, please consider the following
U.S.&nbsp;federal income tax consequences:
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Classification as a Partnership</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For purposes of U.S.&nbsp;federal income taxation, a partnership
is not a taxable entity, and although it may be subject to
withholding taxes on behalf of its partners under certain
circumstances, a partnership itself incurs no U.S.&nbsp;federal
income tax liability. Instead, each partner of a partnership is
required to take into account his share of items of income,
gain, loss, deduction and credit of the partnership in computing
his U.S.&nbsp;federal income tax liability, regardless of
whether cash distributions are made to him by the partnership.
Distributions by a partnership to a partner generally are not
taxable unless the amount of cash distributed exceeds the
partner&#146;s adjusted tax basis in his partnership interest.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Section&nbsp;7704 of the Internal Revenue Code provides that
publicly traded partnerships, as a general rule, will be treated
as corporations for U.S.&nbsp;federal income tax purposes.
However, an exception, referred to as the &#147;Qualifying
Income Exception,&#148; exists with respect to publicly traded
partnerships whose &#147;qualifying income&#148; represents 90%
or more of their gross income for every taxable year. Qualifying
income includes income and gains derived from the transportation
and storage of crude oil, natural gas and products thereof,
including liquefied natural gas. Other types of qualifying
income include interest (other than from a financial business),
dividends, gains from the sale of real property and gains from
the sale or other disposition of capital assets held for the
production of qualifying income, including stock. We have
received a ruling from the IRS that we requested in connection
with our initial public offering that the income we derive from
transporting LNG and crude oil pursuant to time charters
existing at the time of our initial public offering is
qualifying income within the meaning of Section&nbsp;7704. A
ruling from the IRS, while generally binding on the IRS, may
under certain circumstances be revoked or modified by the IRS
retroactively. As to income that is not covered by the IRS
ruling, we will rely upon the opinion of Perkins Coie LLP
whether the income is qualifying income.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We estimate that less than 5% of our current income is not
qualifying income; however, this estimate could change from time
to time for various reasons. Because we have not received an IRS
ruling or an opinion of counsel that any income we derive from
transporting LPG, petrochemical gases and ammonia pursuant to
time charters that we have entered into or will enter into in
the future, or income or gain we recognize from foreign currency
transactions or from interest rate swaps, is qualifying income,
we are currently treating income from those sources as
nonqualifying income. We expect our gross income from charters
relating to LPG, petrochemical gases and ammonia to increase as
we operate the <I>Dania Spirit </I>for a full year and take
delivery of three LPG newbuildings. Also, under some
circumstances, such as a significant increase in interest rates,
the percentage of income or gain from foreign currency
transactions or from interest rate swaps in relation to our
total gross income could be substantial. However, we do not
expect income or gains from transporting LPG, petrochemical
gases or ammonia, and foreign currency transactions or interest
rate swaps and other income or gains that are not qualifying
income to constitute 10% or more of our future gross income for
U.S. federal income tax purposes. Nonetheless, we intend to
request a ruling or an opinion of counsel, or take such other
measures, including conducting the LPG operations in a
subsidiary corporation, as necessary to ensure that the
representations made by us and the general partner to Perkins
Coie LLP described below continue to be true.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">S-8

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Perkins Coie LLP is of the opinion that, based upon the Internal
Revenue Code, Treasury Regulations thereunder, published revenue
rulings and court decisions, the IRS ruling and representations
described below, we will be classified as a partnership for
U.S.&nbsp;federal income tax purposes.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In rendering its opinion, Perkins Coie LLP has relied on factual
representations made by us and the general partner. The
representations made by us and our general partner upon which
Perkins Coie LLP has relied are:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    We have not elected and will not elect to be treated as a
    corporation, and each of our direct or indirect wholly-owned
    subsidiaries has properly elected to be disregarded as an entity
    separate from us, for U.S.&nbsp;federal income tax
    purposes;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    For each taxable year, at least 90% of our gross income will be
    either (a)&nbsp;income to which the IRS ruling described above
    or other IRS ruling received by us applies or (b)&nbsp;of a type
    that Perkins Coie LLP has opined or will opine is
    &#147;qualifying income&#148; within the meaning of
    Section&nbsp;7704(d) of the Internal Revenue Code.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Ratio of Taxable Income to Distributions.</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We estimate that a purchaser of common units in this offering
who owns those common units from the date of closing of this
offering through December&nbsp;31, 2009, will be allocated an
amount of U.S.&nbsp;federal taxable income for that period that
will be 20% or less of the cash distributed with respect to that
period. We anticipate that after the taxable year ending
December&nbsp;31, 2009, the ratio of allocable taxable income to
cash distributions to the unitholders will increase. These
estimates are based upon the assumption that gross income from
operations will approximate the amount required to make our
current level of distributions on all units, on the assumption
that subsequent issuances of units, if any, during the period
ending December&nbsp;31, 2009 will not be made under
circumstances that would increase the ratio of taxable income
allocated to units issued in this offering to distributions
during the period ending December&nbsp;31, 2009 above 20%, and
on other assumptions with respect to capital expenditures,
foreign currency translation income, gains on foreign currency
transactions, cash flow and anticipated cash distributions.
These estimates and assumptions are subject to, among other
things, numerous business, economic, regulatory, competitive and
political uncertainties beyond our control. Further, the
estimates are based on current U.S.&nbsp;federal income tax law
and tax reporting positions that we will adopt and with which
the IRS could disagree. Accordingly, we cannot assure you that
the actual ratio of allocable taxable income to cash
distributions on the common units during the period ending
December&nbsp;31, 2009 will not be materially greater than our
estimate of 20% or less. For example, the ratio of allocable
taxable income to cash distributions could be greater, and
perhaps substantially greater, than 20% with respect to the
period described above if:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    gross income from operations exceeds the amount required to make
    our current level of distributions on all units, yet we continue
    to make distributions at the current levels;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    we make a future offering of common units and use the proceeds
    of the offering in a manner that does not produce substantial
    additional deductions during the period described above, such as
    to repay indebtedness outstanding at the time of this offering
    or to acquire property that is not eligible for depreciation or
    amortization for U.S.&nbsp;federal income tax purposes or that
    is depreciable or amortizable, or produces deductions, at a rate
    significantly slower than the rate applicable to our assets at
    the time of this offering.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If the ratio of allocable taxable income to cash distributions
were materially greater than our estimate, the value of the
common units could be materially adversely affected.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Allocation of Income, Gain, Loss, Deduction and Credit.</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In general, if we have a net profit, our items of income, gain,
loss, deduction and credit will be allocated among the general
partner and the unitholders in accordance with their percentage
interests in us. At any time that distributions are made to the
common units in excess of distributions to the
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">S-9

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
subordinated units, or incentive distributions are made to the
general partner, gross income will be allocated to the
recipients to the extent of these distributions. If we have a
net loss for the entire year, that loss generally will be
allocated first to the general partner and the unitholders in
accordance with their percentage interests in us to the extent
of their positive capital accounts and, second, to the general
partner.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Specified items of our income, gain, loss and deduction will be
allocated to account for any difference between the tax basis
and fair market value of any property held by the partnership
immediately prior to an offering of common units, referred to in
this discussion as &#147;Adjusted Property.&#148; The effect of
these allocations to a unitholder purchasing common units in an
offering will be essentially the same as if the tax basis of our
assets were equal to their fair market value at the time of the
offering. In addition, items of recapture income will be
allocated to the extent possible to the partner who was
allocated the deduction giving rise to the treatment of that
gain as recapture income in order to minimize the recognition of
ordinary income by some unitholders. Finally, although we do not
expect that our operations will result in the creation of
negative capital accounts, if negative capital accounts
nevertheless result, items of our income and gain will be
allocated in an amount and manner to eliminate the negative
balance as quickly as possible.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
An allocation of items of our income, gain, loss, deduction or
credit, other than an allocation required by the Internal
Revenue Code to eliminate the difference between a
partner&#146;s &#147;book&#148; capital account, which is
credited with the fair market value of Adjusted Property, and
&#147;tax&#148; capital account, which is credited with the tax
basis of Adjusted Property, referred to in this discussion as
the &#147;Book-Tax Disparity,&#148; will generally be given
effect for U.S.&nbsp;federal income tax purposes in determining
a partner&#146;s share of an item of income, gain, loss,
deduction or credit only if the allocation has substantial
economic effect. In any other case, a partner&#146;s share of an
item will be determined on the basis of his interest in us,
which will be determined by taking into account all the facts
and circumstances, including:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    his relative contributions to us;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the interests of all the partners in profits and losses;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the interest of all the partners in cash flow;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the rights of all the partners to distributions of capital upon
    liquidation.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A unitholder&#146;s taxable income or loss with respect to a
common unit each year will depend upon a number of factors,
including the nature and fair market value of our assets at the
time the holder acquired the common unit, we issue additional
units or we engage in certain other transactions, and the manner
in which our items of income, gain, loss and deduction are
allocated among our partners. For this purpose, we determine the
value of our assets and the relative amounts of our items of
income, gain, loss and deduction allocable to our unitholders
and our general partner as holder of the incentive distribution
rights by reference to the value of our interests, including the
incentive distribution rights. The IRS may challenge any
valuation determinations that we make, particularly as to the
incentive distribution rights, for which there is no public
market. Moreover, the IRS could challenge certain other aspects
of the manner in which we determine the relative allocations
made to our unitholders and to the general partner as holder of
our incentive distribution rights. A successful IRS challenge to
our valuation or allocation methods could increase the amount of
net taxable income and gain realized by a unitholder with
respect to a common unit.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Perkins Coie LLP is of the opinion that, with the exception of
the issues described in the immediately preceding paragraph,
&#147;&#151;&nbsp;Valuation and Tax Basis of Our
Properties&#148; below, and in the accompanying base prospectus
under &#147;&#151;&nbsp;Consequences of Unit
Ownership&nbsp;&#151; Section&nbsp;754 Election,&#148; and
&#147;&#151;&nbsp;Disposition of Common Units&nbsp;&#151;
Allocations Between Transferors and Transferees,&#148;
allocations under our partnership agreement will be given effect
for U.S.&nbsp;federal income tax purposes in determining a
partner&#146;s share of an item of income, gain, loss, deduction
or credit.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">S-10

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Valuation and Tax Basis of Our Properties.</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The U.S.&nbsp;federal income tax consequences of the ownership
and disposition of units will depend in part on our estimates of
the relative fair market values, and the initial tax bases, of
our assets at the time the holder acquired the common unit, we
issue additional units or we engage in certain other
transactions. Although we may from time to time consult with
professional appraisers regarding valuation matters, we will
make many of the relative fair market value estimates ourselves.
These estimates and determinations of basis are subject to
challenge and will not be binding on the IRS or the courts. If
the estimates of fair market value or basis are later found to
be incorrect, the character and amount of items of income, gain,
loss, deductions or credits previously reported by unitholders
might change, and unitholders might be required to adjust their
tax liability for prior years and incur interest and penalties
with respect to those adjustments. Please also read
&#147;&#151;&nbsp;Allocation of Income, Gain, Loss, Deduction
and Credit&#148; above.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">S-11

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='210'></A>
</DIV>

<!-- link1 "UNDERWRITING" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>UNDERWRITING</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Wachovia Capital Markets, LLC is acting as sole book-running
manager of this offering. Under the terms of an underwriting
agreement, which will be filed as an exhibit to our current
report on Form&nbsp;<FONT style="white-space: nowrap">6-K</FONT>
and incorporated by reference in this prospectus supplement and
the accompanying prospectus, each underwriter named below has
severally agreed to purchase from us the number of common units
set forth opposite its name.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10.0pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="81%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
</TR>

<TR style="font-size: 8.0pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Number of</B></TD>
</TR>

<TR style="font-size: 8.0pt;">
    <TD align="left" nowrap><B>Underwriter</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Common Units</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Wachovia Capital Markets, LLC</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,104,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Citigroup Global Markets Inc.&nbsp;</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>851,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Raymond James&nbsp;&#38; Associates, Inc.&nbsp;</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>345,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,300,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The business address of Wachovia Capital Markets, LLC is 375
Park Avenue, New York, NY 10152.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The underwriting agreement provides that the underwriters&#146;
obligation to purchase common units depends on the satisfaction
of the conditions contained in the underwriting agreement
including:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the obligation to purchase all of the common units offered
    hereby, if any of the common units are purchased;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the representations and warranties made by us to the
    underwriters are true;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    there is no material change in the financial markets;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    we deliver customary closing documents to the underwriters.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Commission and Expenses</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table summarizes the underwriting discounts and
commissions we will pay to the underwriters. These amounts are
shown assuming both no exercise and full exercise of the
underwriters&#146; option to purchase additional common units.
The underwriting fee is the difference between the initial price
to the public and the amount the underwriters pay to us for the
common units.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10.0pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="66%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
</TR>

<TR style="font-size: 8.0pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>No Exercise</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Full Exercise</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Per unit</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>1.3822</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>1.3822</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>3,179,060</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>3,655,919</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have been advised by the underwriters that they propose to
offer the common units directly to the public at the public
offering price on the cover of this prospectus supplement and to
selected dealers, which may include the underwriters, at such
offering price less a selling concession not in excess of
$0.8292 per unit. After the offering, the underwriters may
change the offering price and other selling terms.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The expenses of the offering that are payable by us are
estimated to be $425,000 (exclusive of underwriting discounts
and commissions). The underwriters have agreed to reimburse us
for approximately $110,000 of these expenses or $126,000 if the
overallotment option is exercised in full.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Option to Purchase Additional Common Units</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have granted the underwriters an over-allotment option
exercisable for 30&nbsp;days after the date of the underwriting
agreement to purchase, from time to time, in whole or in part,
up to an aggregate of 345,000 additional common units at the
public offering price less underwriting discounts and
commissions. This option may be exercised if the underwriters
sell more than 2,300,000 common units in connection with this
offering.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">S-12

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Lock-Up Agreements</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We, Teekay Shipping Corporation and the officers and directors
of our general partner have agreed that, without the prior
written consent of Wachovia Capital Markets, LLC, we and they
will not, directly or indirectly, offer, pledge, announce the
intention to sell, sell, contract to sell, sell an option or
contract to
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">S-13

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
purchase, purchase any option or contract to sell, grant any
option, right or warrant to purchase, or otherwise transfer or
dispose of any common units or any securities that may be
converted into or exchanged for any common units, enter into any
swap or other agreement that transfers, in whole or in part, any
of the economic consequences of ownership of the common units,
make any demand for or exercise any right or file or cause to be
filed a registration statement with respect to the registration
of any common units or securities convertible, exercisable or
exchangeable into common units or any of our other securities or
publicly disclose the intention to do any of the foregoing for a
period of 60&nbsp;days from the date of this prospectus
supplement other than permitted transfers.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Wachovia Capital Markets, LLC, in its sole discretion, may
release the common units and other securities subject to the
<FONT style="white-space: nowrap">lock-up</FONT> agreements
described above in whole or in part at any time with or without
notice. When determining whether or not to release common units
and other securities from
<FONT style="white-space: nowrap">lock-up</FONT> agreements,
Wachovia Capital Markets, LLC will consider, among other
factors, the holder&#146;s reasons for requesting the release,
the number of common units and other securities for which the
release is being requested and market conditions at the time.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Indemnification</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have agreed to indemnify the underwriters against certain
liabilities, including liabilities under the Securities Act, and
to contribute to payments that the underwriters may be required
to make for these liabilities.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Stabilization, Short Positions and Penalty Bids</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with this offering, Wachovia Capital Markets, LLC,
on behalf of the underwriters, may engage in stabilizing
transactions, short sales and purchases to cover positions
created by short sales, and penalty bids or purchases for the
purpose of pegging, fixing or maintaining the price of the
common units, in accordance with Regulation&nbsp;M under the
Securities Exchange Act of 1934:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Stabilizing transactions permit bids to purchase the underlying
    security so long as the stabilizing bids do not exceed a
    specified maximum.</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    A short position involves a sale by the underwriters of common
    units in excess of the number of common units the underwriters
    are obligated to purchase in the offering, which creates the
    syndicate short position. This short position may be either a
    covered short position or a naked short position. In a covered
    short position, the number of common units involved in the sales
    made by the underwriters in excess of the number of common units
    it is obligated to purchase is not greater than the number of
    common units that it may purchase by exercising its option to
    purchase additional common units. In a naked short position, the
    number of common units involved is greater than the number of
    common units in its option to purchase additional common units.
    The underwriters may close out any short position by either
    exercising its option to purchase additional common units and/or
    purchasing common units in the open market. In determining the
    source of common units to close out the short position, the
    underwriters will consider, among other things, the price of
    common units available for purchase in the open market as
    compared to the price at which they may purchase common units
    through their option to purchase additional common units. A
    naked short position is more likely to be created if the
    underwriters are concerned that there could be downward pressure
    on the price of the common units in the open market after
    pricing that could adversely affect investors who purchase in
    the offering.</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Syndicate covering transactions involve purchases of the common
    units in the open market after the distribution has been
    completed in order to cover syndicate short positions.</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Penalty bids permit the underwriters to reclaim a selling
    concession from a syndicate member when the common units
    originally sold by the syndicate member are purchased in a
    stabilizing or syndicate covering transaction to cover syndicate
    short positions.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
These stabilizing transactions, syndicate covering transactions
and penalty bids may have the effect of raising or maintaining
the market price of our common units or preventing or retarding
a decline in the market price of the common units. As a result,
the price of the common units may be higher than the
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">S-14

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
price that might otherwise exist in the open market. These
transactions may be effected on the New York Stock Exchange or
otherwise and, if commenced, may be discontinued at any time.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Neither we nor the underwriters make any representation or
prediction as to the direction or magnitude of any effect that
the transactions described above may have on the price of the
common units. In addition, neither we nor the underwriters make
any representation that the underwriters will engage in these
stabilizing transactions or that any transaction, once
commenced, will not be discontinued without notice.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Electronic Distribution</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A prospectus in electronic format may be made available on one
or more of the Internet sites or through other online services
maintained by any of the underwriters and/or selling group
members participating in this offering, or by their affiliates.
In those cases, prospective investors may view offering terms
online and, depending upon the particular underwriter or selling
group member, prospective investors may be allowed to place
orders online. The underwriters may agree with us to allocate a
specific number of common units for sale to online brokerage
account holders. Any such allocation for online distributions
will be made by the underwriters on the same basis as other
allocations.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Other than the prospectus in electronic format, the information
on the underwriters&#146; or any selling group member&#146;s web
site and any information contained in any other web site
maintained by the underwriters or selling group member is not
part of the prospectus or the registration statement of which
this prospectus supplement and the accompanying prospectus forms
a part, has not been approved and/or endorsed by us or the
underwriters or selling group member in its capacity as
underwriters or selling group member and should not be relied
upon by investors.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Stamp Taxes</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If you purchase common units offered in this prospectus
supplement and the accompanying prospectus, you may be required
to pay stamp taxes and other charges under the laws and
practices of the country of purchase, in addition to the
offering price listed on the cover page of this prospectus
supplement and the accompanying prospectus.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Relationships</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The underwriters and their related entities have engaged and may
engage in commercial and investment banking transactions with
Teekay Shipping Corporation, our general partner and us in the
ordinary course of its business. They have received customary
compensation and expenses for these commercial and investment
banking transactions.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Discretionary Sales</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The underwriters have informed us that they will not confirm
sales to discretionary accounts without the prior written
approval of the customer.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NASD Conduct Rules</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Because the NASD views the common units offered hereby as
interests in a direct participation program, the offering is
being made in compliance with Rule&nbsp;2810 of the NASD Conduct
Rules. Investor suitability with respect to the common units
should be judged similarly to the suitability with respect to
other securities that are listed for trading on a national
securities exchange. In no event will the maximum amount of
compensation to be paid to NASD members in connection with this
offering exceed 10% plus 0.5% for bona fide due diligence.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">S-15

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='211'></A>
</DIV>

<!-- link1 "SERVICE OF PROCESS AND ENFORCEMENT OF CIVIL LIABILITIES" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>SERVICE OF PROCESS AND ENFORCEMENT OF CIVIL LIABILITIES</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Teekay LNG Partners L.P. is organized under the laws of the
Marshall Islands as a limited partnership. Our general partner
is organized under the laws of the Marshall Islands as a limited
liability company. The Marshall Islands has a less developed
body of securities laws as compared to the United States and
provides protections for investors to a significantly lesser
extent.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Most of the directors and officers of our general partner and
those of our subsidiaries are residents of countries other than
the United States. Substantially all of our and our
subsidiaries&#146; assets and a substantial portion of the
assets of the directors and officers of our general partner are
located outside the United States. As a result, it may be
difficult or impossible for United States investors to effect
service of process within the United States upon us, our general
partner, our subsidiaries or the directors and officers of our
general partner or to realize against us or them judgments
obtained in United States courts, including judgments predicated
upon the civil liability provisions of the securities laws of
the United States or any state in the United States. However, we
have expressly submitted to the jurisdiction of the
U.S.&nbsp;federal and New York state courts sitting in the City
of New York for the purpose of any suit, action or proceeding
arising under the securities laws of the United States or any
state in the United States, and we have appointed Watson,
Farley&nbsp;&#38; Williams (New York) LLP to accept service of
process on our behalf in any such action.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Watson, Farley&nbsp;&#38; Williams (New York) LLP, our counsel
as to Marshall Islands law, has advised us that there is
uncertainty as to whether the courts of the Marshall Islands
would (1)&nbsp;recognize or enforce against us, our general
partner or our general partner&#146;s directors or officers
judgments of courts of the United States based on civil
liability provisions of applicable U.S.&nbsp;federal and state
securities laws or (2)&nbsp;impose liabilities against us, our
general partner or our general partner&#146;s directors and
officers in original actions brought in the Marshall Islands,
based on these laws.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">S-16

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='212'></A>
</DIV>

<!-- link1 "LEGAL MATTERS" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>LEGAL MATTERS</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The validity of the common units offered hereby and certain
other legal matters with respect to the laws of the Republic of
The Marshall Islands will be passed upon for us by our counsel
as to Marshall Islands law, Watson, Farley&nbsp;&#38; Williams
(New York) LLP. Certain other legal matters will be passed upon
for us by Perkins Coie LLP, Portland, Oregon, which may rely on
the opinions of Watson, Farley&nbsp;&#38; Williams (New York)
LLP for all matters of Marshall Islands Law. Baker Botts L.L.P.,
Houston Texas, will pass upon certain legal matters in
connection with the offering on behalf of the underwriters.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='213'></A>
</DIV>

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<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>EXPERTS</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The consolidated financial statements of Teekay LNG Partners
appearing in its Annual Report on
Form&nbsp;<FONT style="white-space: nowrap">20-F</FONT> for the
year ended December&nbsp;31, 2006 have been audited by
Ernst&nbsp;&#38; Young LLP, an independent registered public
accounting firm, as set forth in their report thereon included
therein, and incorporated herein by reference. Such financial
statements are incorporated herein in reliance upon the report
of Ernst&nbsp;&#38; Young LLP pertaining to such financial
statements given on the authority of such firm as experts in
accounting and auditing. You may contact Ernst&nbsp;&#38; Young
LLP at address 700&nbsp;West Georgia Street, Vancouver, British
Columbia, V7Y 1C7, Canada.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='214'></A>
</DIV>

<!-- link1 "EXPENSES" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>EXPENSES</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table sets forth costs and expenses, other than
any underwriting discounts and commissions, we expect to incur
in connection with the issuance and distribution of the common
units covered by this prospectus. Other than the
U.S.&nbsp;Securities and Exchange Commission registration fee
which is set forth in the base prospectus, all amounts are
estimated except the National Association of Securities Dealers
Inc. filing fee.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10.0pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="83%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    NASD filing fee</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>40,500</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Legal fees and expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>250,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accounting fees and expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>100,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Printing costs</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>25,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Transfer agent fees</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>9,500</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>425,000</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">S-17
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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<B>PROSPECTUS</B>
</DIV>

<DIV align="center" style="font-size: 18.0pt;color: #000000; background: #ffffff;">
<B>$400,000,000</B>
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<IMG src="o36113xo3611300.gif" alt="(TEEKAY LNG PARTNERS L.P. LOGO)">
</DIV>

<DIV align="center" style="font-size: 30.0pt;color: #000000; background: #ffffff;">
<B>Teekay LNG Partners L.P.</B>
</DIV>

<DIV align="center" style="font-size: 30.0pt;color: #000000; background: #ffffff;">
<B>Teekay LNG Finance Corp.</B>
</DIV>

<DIV align="center" style="font-size: 3.0pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 22%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="center" style="font-size: 18.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Common Units</B>
</DIV>

<DIV align="center" style="font-size: 18.0pt;color: #000000; background: #ffffff;">
<B>Debt Securities</B>
</DIV>

<DIV align="center" style="font-size: 3.0pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 22%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="left" style="font-size: 9.5pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;
We may offer, from time to time:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 9.5pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    common units, representing limited partnership interests in
    Teekay LNG Partners L.P.;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    debt securities, which may be secured or unsecured senior debt
    securities or secured or unsecured subordinated debt securities.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 9.5pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;
Teekay LNG Finance Corp. may act as co-issuer of the debt
securities, and other direct or indirect subsidiaries of Teekay
LNG Partners L.P. may guarantee the debt securities.
</DIV>

<DIV align="left" style="font-size: 9.5pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;
The securities we may offer:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 9.5pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    will have a maximum aggregate offering price of $400,000,000;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    will be offered at prices and on terms to be set forth in one or
    more accompanying prospectus supplements;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    may be offered separately or together, or in separate series.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 9.5pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;
We may offer these securities directly or to or through
underwriters, dealers or other agents. The names of any
underwriters or dealers will be set forth in the applicable
prospectus supplement.
</DIV>

<DIV align="left" style="font-size: 9.5pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;
Our common units trade on the New York Stock Exchange under the
symbol &#147;TGP.&#148; We will provide information in the
prospectus supplement for the trading market, if any, for any
debt securities we may offer.
</DIV>

<DIV align="left" style="font-size: 9.5pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;
This prospectus provides you with a general description of the
securities we may offer. Each time we offer to sell securities
we will provide a prospectus supplement that will contain
specific information about those securities and the terms of
that offering. The prospectus supplement may also add, update or
change information contained in this prospectus. This prospectus
may be used to offer and sell securities only if accompanied by
a prospectus supplement. You should read this prospectus and any
prospectus supplement carefully before you invest. You should
also read the documents we refer to in the &#147;Where You Can
Find More Information&#148; section of this prospectus for
information about us and our financial statements.
</DIV>

<DIV align="left" style="font-size: 12.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Limited partnerships are inherently different than
corporations. You should carefully consider each of the factors
described under &#147;Risk Factors&#148; beginning on
page&nbsp;7 of this prospectus before you make an investment in
our securities.</B>
</DIV>

<DIV align="left" style="font-size: 9.5pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;
<B>Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or determined if this prospectus is truthful or
complete. Any representation to the contrary is a criminal
offense.</B>
</DIV>

<DIV align="left" style="font-size: 9.5pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
September&nbsp;29, 2006
</DIV>
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<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>TABLE OF CONTENTS</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<!-- TOC -->
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name="tocpage"></A>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10.0pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="90%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#101'>About This Prospectus</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#102'>Teekay LNG Partners L.P.</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#103'>Partnership Structure and Management</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#104'>Teekay LNG Finance Corp.</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#105'>Subsidiary Guarantors</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#106'>Where You Can Find More
    Information</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#107'>Forward-Looking Statements</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#108'>Risk Factors</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#109'>Risks Inherent in Our Business</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#110'>Risks Inherent in an Investment in Us</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>19</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#111'>Risks Relating to the Common Units</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>24</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#112'>Risks Relating to the Debt Securities</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>26</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#113'>Tax Risks</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>27</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#114'>Use of Proceeds</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#115'>Ratio of Earnings To Fixed
    Charges</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#177'>Price Range of Common Units and
    Distributions</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>31</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#116'>Description of The Common Units</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>32</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#117'>Number of Units</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>32</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#118'>Issuance of Additional Securities</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>32</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#119'>Meetings; Voting</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>32</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#120'>Call Right</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>34</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#121'>Exchange Listing</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>34</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#122'>Transfer Agent and Registrar</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>34</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#123'>Transfer of Common Units</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>34</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#178'>Other Matters</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>35</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#124'>Summary of Our Partnership Agreement</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>36</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#125'>Cash Distributions</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>37</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#126'>Distributions of Available Cash</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>37</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#127'>Operating Surplus and Capital Surplus</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>37</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#128'>Subordination Period</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>40</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#129'>Distributions of Available Cash From
    Operating Surplus During the Subordination Period</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>41</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#130'>Distributions of Available Cash From
    Operating Surplus After the Subordination Period</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>42</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#131'>Incentive Distribution Rights</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>42</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#132'>Percentage Allocations of Available Cash
    From Operating Surplus</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>42</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#133'>Distributions From Capital Surplus</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>43</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#134'>Adjustment to the Minimum Quarterly
    Distribution and Target Distribution Levels</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>44</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#135'>Distributions of Cash Upon Liquidation</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>44</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#136'>Description of Debt Securities</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>47</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#137'>General</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>47</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#138'>Specific Terms of Each Series of Debt
    Securities to be Described in the Prospectus Supplement</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>47</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#139'>Subsidiary Guarantees</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>48</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#140'>Consolidation, Merger or Asset Sale</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>49</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#141'>No Protection in the Event of a Change of
    Control</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>49</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">i

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10.0pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="90%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#142'>Modification of Indentures</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>49</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#143'>Events of Default and Remedies</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>51</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#145'>Defeasance</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>52</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#146'>No Limit on Amount of Debt Securities</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>53</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#147'>Registration of Notes</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>54</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#148'>Minimum Denominations</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>54</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#149'>No Personal Liability</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>54</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#150'>Payment and Transfer</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>54</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#151'>Exchange, Registration and Transfer</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>54</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#152'>Provisions Relating Only to the Senior Debt
    Securities</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>55</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#153'>Provisions Relating Only to the
    Subordinated Debt Securities</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>55</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#154'>Book Entry, Delivery and Form</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>55</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#155'>Governing Law</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>56</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#156'>The Trustee</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>56</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#157'>Material U.S.&nbsp;Federal Income Tax
    Consequences</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>58</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#158'>Classification as a Partnership</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>58</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#159'>Status as a Partner</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>59</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#160'>Consequences of Unit Ownership</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>60</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#161'>Tax Treatment of Operations</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>64</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#162'>Disposition of Common Units</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>65</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#163'>Foreign Tax Credit Considerations</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>66</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#164'>Tax-Exempt Organizations and
    Non-U.S.&nbsp;Investors</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>67</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#165'>Functional Currency</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>68</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#166'>Administrative Matters</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>69</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#167'>Possible Classification as a Corporation</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>71</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#168'>Tax Consequences of Ownership of Debt
    Securities</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>75</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#169'>Non-United States Tax
    Consequences</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>75</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#170'>Marshall Islands Tax Consequences</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>75</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#171'>Canadian Federal Income Tax Consequences</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>75</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#172'>Plan Of Distribution</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>77</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#173'>Service of Process and Enforcement of
    Civil Liabilities</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>79</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#174'>Legal</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>79</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#175'>Experts</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>79</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>&nbsp;<A HREF='#176'>Expenses</A></B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>80</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<!-- /TOC -->
</DIV>

<DIV align="center" style="font-size: 3.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 22%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
You should rely only on the information contained in this
prospectus, any prospectus supplement and the documents
incorporated by reference in this prospectus. We have not
authorized anyone else to give you different information. If
anyone provides you with different or inconsistent information,
you should not rely on it. We are not offering these securities
in any jurisdiction where the offer or sale is not permitted.
You should not assume that the information in this prospectus or
any prospectus supplement is accurate as of any date other than
the date on the front of those documents. We will disclose
material changes in our affairs in an amendment to this
prospectus, a prospectus supplement or a future filing with the
U.S.&nbsp;Securities and Exchange Commission incorporated by
reference in this prospectus.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">ii
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='101'></A>
</DIV>

<!-- link1 "ABOUT THIS PROSPECTUS" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>ABOUT THIS PROSPECTUS</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
This prospectus is part of a registration statement on
Form&nbsp;<FONT style="white-space: nowrap">F-3</FONT> that we
have filed with the U.S.&nbsp;Securities and Exchange Commission
(or <I>SEC</I>) using a &#147;shelf&#148; registration process.
Under this shelf registration process, we may sell, in one or
more offerings, up to $400,000,000 in total aggregate offering
price of the securities described in this prospectus. This
prospectus generally describes us and the securities we may
offer. Each time we offer securities with this prospectus, we
will provide this prospectus and a prospectus supplement that
will describe, among other things, the specific amounts and
prices of the securities being offered and the terms of the
offering, including, in the case of debt securities, the
specific terms of the securities. The prospectus supplement may
also add to, update or change information in this prospectus. If
there is any inconsistency between the information in this
prospectus and any prospectus supplement, you should rely on the
information in the prospectus supplement.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Unless otherwise indicated, references in this prospectus to
&#147;Teekay LNG Partners,&#148; &#147;we,&#148; &#147;us&#148;
and &#147;our&#148; and similar terms refer to Teekay LNG
Partners&nbsp;L.P. and/or one or more of its subsidiaries,
except that those terms, when used in this prospectus in
connection with the common units described herein, shall mean
Teekay LNG Partners&nbsp;L.P. References in this prospectus to
&#147;Teekay Shipping Corporation&#148; refer to Teekay Shipping
Corporation and/or any one or more of its subsidiaries.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Unless otherwise indicated, all references in this prospectus to
&#147;dollars&#148; and &#147;$&#148; are to, and amounts are
presented in, U.S.&nbsp;Dollars, and financial information
presented in this prospectus is prepared in accordance with
accounting principles generally accepted in the United States
(or <I>GAAP</I>).
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The information in this prospectus is accurate as of its date.
You should read carefully this prospectus, any prospectus
supplement, and the additional information described below under
the heading &#147;Where You Can Find More Information.&#148;
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">1

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='102'></A>
</DIV>

<!-- link1 "TEEKAY LNG PARTNERS L.P." -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>TEEKAY LNG PARTNERS L.P.</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Teekay LNG Partners L.P. is an international provider of
liquefied natural gas (or <I>LNG</I>) and crude oil marine
transportation services. In November&nbsp;2004, we were formed
as a Marshall Islands limited partnership by Teekay Shipping
Corporation, the world&#146;s largest owner and operator of
medium-sized crude oil tankers, to expand its operations in the
LNG shipping sector. Our growth strategy focuses on expanding
our fleet of LNG carriers under long-term, fixed-rate charters.
We view our Suezmax tanker fleet primarily as a source of stable
cash flow as we expand our LNG operations. We seek to leverage
the expertise, relationships and reputation of Teekay Shipping
Corporation and its affiliates to pursue growth opportunities in
the LNG shipping sector. Teekay Shipping Corporation currently
owns our general partner and a 67.8% limited partner interest in
us.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our fleet, excluding newbuilding vessels, currently consists of
four LNG carriers and eight Suezmax class crude oil tankers, all
of which are double-hulled. These vessels operate under
long-term, fixed-rate time charter contracts with major energy
and utility companies. As of September&nbsp;1, 2006, the average
remaining term for these charters was approximately
19&nbsp;years for our LNG carriers and approximately
13&nbsp;years for our Suezmax tankers, subject, in certain
circumstances, to termination or vessel purchase rights. We have
agreed to purchase from Teekay Shipping Corporation its rights
to three newbuilding LNG carriers under capital leases upon the
delivery of the first vessel, which is scheduled during the
fourth quarter of 2006.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='103'></A>
</DIV>

<!-- link1 "Partnership Structure and Management" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Partnership Structure and Management</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our operations are conducted through, and our operating assets
are owned by, our subsidiaries. We own our interests in our
subsidiaries through our 100% ownership interest in our
operating company, Teekay LNG Operating&nbsp;L.L.C., a Marshall
Islands limited liability company. Our general partner,
Teekay&nbsp;GP&nbsp;L.L.C., a Marshall Islands limited liability
company, has an economic interest in us and manages our
operations and activities. Our general partner does not receive
any management fee or other compensation in connection with its
management of our business, but it is entitled to be reimbursed
for all direct and indirect expenses incurred on our behalf.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our principal executive offices are located at Bayside House,
Bayside Executive Park, West Bay Street and Blake Road, P.O.
Box&nbsp;AP-59212, Nassau, Commonwealth of the Bahamas, and our
phone number is (242)&nbsp;502-8820.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='104'></A>
</DIV>

<!-- link1 "TEEKAY LNG FINANCE CORP." -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>TEEKAY LNG FINANCE CORP.</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Teekay LNG Finance Corp. is a Marshall Islands corporation and
wholly owned subsidiary of Teekay LNG Partners. It has nominal
assets and its activities will be limited to co-issuing debt
securities that Teekay LNG Partners may offer and engaging in
other activities incidental thereto. Teekay LNG Finance Corp.
may act as co-issuer of debt securities to allow investment in
those securities by institutional investors that may not
otherwise be able to invest due to our structure and investment
restrictions under their respective states of organization or
charters. You should not expect Teekay LNG Finance Corp. to be
able to service obligations on any debt securities for which it
may act as co-issuer.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='105'></A>
</DIV>

<!-- link1 "SUBSIDIARY GUARANTORS" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>SUBSIDIARY GUARANTORS</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of the date of this prospectus, Teekay LNG Partners owns,
directly or indirectly, 100% of the outstanding ownership
interests of the following subsidiaries, among others: Teekay
LNG Operating&nbsp;L.L.C., African Spirit L.L.C., Asian Spirit
L.L.C., European Spirit L.L.C., Teekay Luxembourg&nbsp;S.a.r.l.,
Teekay Spain,&nbsp;S.L., Teekay&nbsp;II Iberia&nbsp;S.L., Teekay
Shipping Spain,&nbsp;S.L., Naviera Teekay Gas,&nbsp;S.L.,
Naviera Teekay Gas&nbsp;II,&nbsp;S.L., Naviera Teekay
Gas&nbsp;III,&nbsp;S.L. and Naviera Teekay
Gas&nbsp;IV,&nbsp;S.L. If specified in the prospectus supplement
for a series of debt securities offered by this prospectus, the
subsidiaries of Teekay LNG Partners&nbsp;L.P. specified in the
prospectus supplement will unconditionally guarantee, on a joint
and several basis, the full and prompt payment of principal of,
premium, if any, and interest on the debt securities of that
series. Occasionally in this prospectus we refer to Teekay LNG
Partner&#146;s subsidiaries that may provide these guarantees as
the &#147;Subsidiary Guarantors,&#148; which term will also
include any other subsidiaries of Teekay LNG Partners that may
hereafter be added to the registration statement of which this
prospectus is a part and may provide such guarantees.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">2

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<P><HR noshade><P>
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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='106'></A>
</DIV>

<!-- link1 "WHERE YOU CAN FIND MORE INFORMATION" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>WHERE YOU CAN FIND MORE INFORMATION</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have filed with the SEC a registration statement on
Form&nbsp;<FONT style="white-space: nowrap">F-3</FONT> regarding
the securities covered by this prospectus. This prospectus does
not contain all of the information found in the registration
statement. For further information regarding us and the
securities offered in this prospectus, you may wish to review
the full registration statement, including its exhibits. The
registration statement, including the exhibits, may be inspected
and copied at the public reference facilities maintained by the
SEC at 100 F Street, NE, Washington,&nbsp;D.C. 20549. Copies of
this material can also be obtained upon written request from the
Public Reference Section of the SEC at that address, at
prescribed rates, or from the SEC&#146;s web site on the
Internet at <U>www.sec.gov</U> free of charge. Please call the
SEC at <FONT style="white-space: nowrap">1-800-SEC-0330</FONT>
for further information on public reference rooms. Our
registration statement can also be inspected and copied at the
offices of the New York Stock Exchange, Inc., 20&nbsp;Broad
Street, New York, New York 10005.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are subject to the information requirements of the U.S.
Securities Exchange Act of 1934 (or the <I>Exchange Act</I>),
and, in accordance therewith, we are required to file with the
SEC annual reports on
Form&nbsp;<FONT style="white-space: nowrap">20-F</FONT> within
six months of our fiscal year-end, and provide to the SEC other
material information on
Form&nbsp;<FONT style="white-space: nowrap">6-K.</FONT> We
intend to file our annual report on
Form&nbsp;<FONT style="white-space: nowrap">20-F</FONT> earlier
than the SEC currently requires. These reports and other
information may be inspected and copied at the public reference
facilities maintained by the SEC or obtained from the SEC&#146;s
website as provided above. Our website on the Internet is
located at <U>www.teekaylng.com</U>, and we expect to make our
periodic reports and other information filed with or furnished
to the SEC available, free of charge, through our website, as
soon as reasonably practicable after those reports and other
information are electronically filed with or furnished to the
SEC. Information on our website or any other website is not
incorporated by reference into this prospectus and does not
constitute a part of this prospectus.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As a foreign private issuer, we are exempt under the Exchange
Act from, among other things, certain rules prescribing the
furnishing and content of proxy statements, and our executive
officers, directors and principal unitholders are exempt from
the reporting and short-swing profit recovery provisions
contained in Section&nbsp;16 of the Exchange Act. In addition,
we are not required under the Exchange Act to file periodic
reports and financial statements with the SEC as frequently or
as promptly as U.S.&nbsp;companies whose securities are
registered under the Exchange Act, including the filing of
quarterly reports or current reports on
Form&nbsp;<FONT style="white-space: nowrap">8-K.</FONT> However,
we intend to make available quarterly reports containing our
unaudited interim financial information for the first three
fiscal quarters of each fiscal year.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The SEC allows us to &#147;incorporate by reference&#148; into
this prospectus information that we file with the SEC. This
means that we can disclose important information to you without
actually including the specific information in this prospectus
by referring you to other documents filed separately with the
SEC. The information incorporated by reference is an important
part of this prospectus. Information that we later provide to
the SEC, and which is deemed to be &#147;filed&#148; with the
SEC, automatically will update information previously filed with
the SEC, and may replace information in this prospectus.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We incorporate by reference into this prospectus the documents
listed below:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our Annual Report on
    Form&nbsp;<FONT style="white-space: nowrap">20-F</FONT> for the
    fiscal year ended December&nbsp;31, 2005;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    all subsequent Annual Reports on
    Form&nbsp;<FONT style="white-space: nowrap">20-F</FONT> filed
    prior to the termination of this offering;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our current Reports on
    Form&nbsp;<FONT style="white-space: nowrap">6-K</FONT> furnished
    on May&nbsp;17 and August&nbsp;17, 2006;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    all subsequent Reports on
    Form&nbsp;<FONT style="white-space: nowrap">6-K</FONT> furnished
    prior to the termination of this offering that we identify in
    such Reports as being incorporated by reference into the
    registration statement of which this prospectus is a
    part;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the description of our common units contained in our
    Registration Statement on
    Form&nbsp;<FONT style="white-space: nowrap">8-A/</FONT> A filed
    on September&nbsp;29, 2006, including any subsequent amendments
    or reports filed for the purpose of updating such description.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">3
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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
These reports contain important information about us, our
financial condition and our results of operations.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
You may obtain any of the documents incorporated by reference in
this prospectus from the SEC through its public reference
facilities or its website at the addresses provided above. You
also may request a copy of any document incorporated by
reference in this prospectus (excluding any exhibits to those
documents, unless the exhibit is specifically incorporated by
reference in this document), at no cost, by visiting our
Internet website at <U>www.teekaylng.com</U>, or by writing or
calling us at the following address:
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
Teekay LNG Partners L.P.
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
Bayside House, Bayside Executive Park
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
West Bay Street and Blake Road
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
P.O. Box&nbsp;AP-59212
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
Nassau, Commonwealth of the Bahamas
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
Attn: Corporate Secretary
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
(242)&nbsp;502-8820
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
You should rely only on the information incorporated by
reference or provided in this prospectus or any prospectus
supplement. We have not authorized anyone else to provide you
with any information. You should not assume that the information
incorporated by reference or provided in this prospectus or any
prospectus supplement is accurate as of any date other than the
date on the front of each document.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">4

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='107'></A>
</DIV>

<!-- link1 "FORWARD-LOOKING STATEMENTS" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>FORWARD-LOOKING STATEMENTS</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
All statements, other than statements of historical fact,
included in or incorporated by reference into this prospectus
and any prospectus supplements are forward-looking statements.
In addition, we and our representatives may from time to time
make other oral or written statements that also forward-looking
statements. Such statements include, in particular, statements
about our plans, strategies, business prospects, changes and
trends in our business, and the markets in which we operate. In
some cases, you can identify the forward-looking statements by
the use of words such as &#147;may,&#148; &#147;will,&#148;
&#147;could,&#148; &#147;should,&#148; &#147;would,&#148;
&#147;expect,&#148; &#147;plan,&#148; &#147;anticipate,&#148;
&#147;intend,&#148; &#147;forecast,&#148; &#147;believe,&#148;
&#147;estimate,&#148; &#147;predict,&#148; &#147;propose,&#148;
&#147;potential,&#148; &#147;continue&#148; or the negative of
these terms or other comparable terminology.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Forward-looking statements include statements with respect to,
among other things:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our ability to make cash distributions on our common units or
    any increases in our quarterly distributions;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our ability to make required payments on any debt securities we
    may issue;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our future financial condition or results of operations and our
    future revenues and expenses;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    global growth prospects of the LNG shipping and tanker markets;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    LNG and tanker market fundamentals, including the balance of
    supply and demand in the LNG and tanker market;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the expected lifespan of a new LNG carrier and Suezmax tanker;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    planned and estimated future capital expenditures and
    availability of capital resources to fund capital expenditures;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our ability to maintain long-term relationships with major LNG
    importers and exporters and major crude oil companies;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our ability to leverage to our advantage Teekay Shipping
    Corporation&#146;s relationships and reputation in the shipping
    industry;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our continued ability to enter into long-term, fixed-rate time
    charters with our LNG customers;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    obtaining LNG projects that we or Teekay Shipping Corporation
    bid on or have been awarded;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our ability to maximize the use of our vessels, including the
    re-deployment or disposition of vessels no longer under
    long-term charter;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    expected purchases and deliveries of newbuilding vessels and
    commencement of service of newbuildings under long-term
    contracts, including those relating to LNG projects that have
    been awarded to Teekay Shipping Corporation and will be offered
    to us;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the expected timing, amount and method of financing for the
    purchase of five of our existing Suezmax tankers;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our expected financial flexibility to pursue acquisitions and
    other expansion opportunities;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the expected cost of, and our ability to comply with,
    governmental regulations and maritime self-regulatory
    organization standards applicable to our business;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the expected impact of heightened environmental and quality
    concerns of insurance underwriters, regulators and charterers;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the anticipated taxation of our partnership and its subsidiaries;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    entering into credit facilities or vessel financing arrangements
    for any of our vessels, and the effects of such
    arrangements;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our business strategy and other plans and objectives for future
    operations.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">5

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
These and other forward-looking statements are subject to risks,
uncertainties and assumptions, including those risks discussed
in &#147;Risk Factors&#148; below and those risks discussed in
other reports we file with the SEC and that are incorporated in
this prospectus by reference. The risks, uncertainties and
assumptions involve known and unknown risks and are inherently
subject to significant uncertainties and contingencies, many of
which are beyond our control.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Forward-looking statements are made based upon management&#146;s
current plans, expectations, estimates, assumptions and beliefs
concerning future events affecting us and, therefore, involve a
number of risks and uncertainties, including those risks
discussed in &#147;Risk Factors.&#148; We caution that
forward-looking statements are not guarantees and that actual
results could differ materially from those expressed or implied
in the forward-looking statements.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We undertake no obligation to update any forward-looking
statement to reflect events or circumstances after the date on
which such statement is made or to reflect the occurrence of
unanticipated events. New factors emerge from time to time, and
it is not possible for us to predict all of these factors.
Further, we cannot assess the effect of each such factor on our
business or the extent to which any factor, or combination of
factors, may cause actual results to be materially different
from those contained in any forward-looking statement.
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='108'></A>
</DIV>

<!-- link1 "RISK FACTORS" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>RISK FACTORS</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Although many of our business risks are comparable to those a
corporation engaged in a similar business would face, limited
partner interests are inherently different from the capital
stock of a corporation. You should carefully consider the
following risk factors together with all of the other
information included or incorporated in this prospectus when
evaluating an investment in our common units or debt
securities.</I>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>If any of the following risks actually occur, our business,
financial condition or operating results could be materially
harmed. In that case, our ability to pay distributions on our
common units or pay interest on, or principal of, any debt
securities, may be reduced, the trading price of our securities
could decline, and you could lose all or part of your
investment.</I>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='109'></A>
</DIV>

<!-- link1 "Risks Inherent in Our Business" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Risks Inherent in Our Business</B>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We may not have sufficient cash from operations to enable
    us to make required payments on our debt securities or to pay
    the minimum quarterly distribution on our common units following
    the establishment of cash reserves and payment of fees and
    expenses.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We may not have sufficient cash available to make required
payments on our debt securities or to pay the minimum quarterly
distribution on our common units. The amount of cash we have
available to make required payments on our debt securities or to
distribute on our common units principally depends upon the
amount of cash we generate from our operations, which may
fluctuate based on, among other things:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the rates we obtain from our charters;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the level of our operating costs, such as the cost of crews and
    insurance;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the continued availability of LNG production, liquefaction and
    regasification facilities;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the number of unscheduled off-hire days for our fleet and the
    timing of, and number of days required for, scheduled drydocking
    of our vessels;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    delays in the delivery of newbuildings and the beginning of
    payments under charters relating to those vessels;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    prevailing global and regional economic and political conditions;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    currency exchange rate fluctuations;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the effect of governmental regulations and maritime
    self-regulatory organization standards on the conduct of our
    business.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The actual amount of cash we will have available for required
payments on our debt securities and distributions on our common
units also will depend on factors such as:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the level of capital expenditures we make, including for
    maintaining vessels, building new vessels, acquiring existing
    vessels and complying with regulations;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our debt service requirements and restrictions on payments and
    distributions contained in our debt instruments;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    fluctuations in our working capital needs;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our ability to make working capital borrowings, including to pay
    distributions to unitholders;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the amount of any cash reserves, including reserves for future
    capital expenditures and other matters, established by our
    general partner in its discretion.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The amount of cash we generate from our operations may differ
materially from our profit or loss for the period, which will be
affected by non-cash items. As a result of this and the other
factors mentioned
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">7

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
above, we may make cash distributions during periods when we
record losses and may not make cash distributions during periods
when we record net income.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We make substantial capital expenditures to maintain the
    operating capacity of our fleet, which reduce our cash available
    to make required payments on our debt securities and for
    distribution on our common units. In addition, each quarter our
    general partner is required to deduct estimated maintenance
    capital expenditures from operating surplus, which may result in
    less cash available to unitholders than if actual maintenance
    capital expenditures were deducted.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We must make substantial capital expenditures to maintain, over
the long term, the operating capacity of our fleet. These
maintenance capital expenditures include capital expenditures
associated with drydocking a vessel, modifying an existing
vessel or acquiring a new vessel to the extent these
expenditures are incurred to maintain the operating capacity of
our fleet. These expenditures could increase as a result of
changes in:
</DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the cost of labor and materials;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    customer requirements;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    increases in the size of our fleet;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    governmental regulations and maritime self-regulatory
    organization standards relating to safety, security or the
    environment;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    competitive standards.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our significant maintenance capital expenditures will reduce the
amount of cash we have available to make required payments on
our debt securities and for distribution to our unitholders.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, our actual maintenance capital expenditures vary
significantly from quarter to quarter based on, among other
things, the number of vessels drydocked during that quarter. Our
partnership agreement requires our general partner to deduct
estimated, rather than actual, maintenance capital expenditures
from operating surplus each quarter in an effort to reduce
fluctuations in operating surplus. The amount of estimated
maintenance capital expenditures deducted from operating surplus
is subject to review and change by the conflicts committee of
our general partner at least once a year. In years when
estimated maintenance capital expenditures are higher than
actual maintenance capital expenditures&nbsp;&#151; as we expect
will be the case in the years we are not required to make
expenditures for mandatory drydockings&nbsp;&#151; the amount of
cash available for distribution to unitholders will be lower
than if actual maintenance capital expenditures were deducted
from operating surplus. If our general partner underestimates
the appropriate level of estimated maintenance capital
expenditures, we may have less cash available for distribution
in future periods when actual capital expenditures begin to
exceed our previous estimates.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We will be required to make substantial capital
    expenditures to expand the size of our fleet. We generally will
    be required to make significant installment payments for
    acquisitions of newbuilding vessels prior to their delivery and
    generation of revenue. Depending on whether we finance our
    expenditures through cash from operations or by issuing debt or
    equity securities, our ability to make required payments on our
    debt securities and cash distributions on our common units may
    be diminished or our financial leverage could increase or our
    unitholders could be diluted.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We intend to make substantial capital expenditures to increase
the size of our fleet, particularly the number of LNG carriers
we own.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During May 2005, we entered into an agreement with Teekay
Shipping Corporation to purchase its 70% interest in Teekay
Nakilat Corporation. Our estimated purchase commitment is
$92.8&nbsp;million. Teekay Nakilat Corporation has a
<FONT style="white-space: nowrap">30-year</FONT> capital lease
arrangement on three LNG carriers currently under construction.
The purchase will occur upon the delivery of the first LNG
newbuilding carrier under lease, which is scheduled during the
fourth quarter of 2006.
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, we are obligated to purchase five of our existing
Suezmax tankers upon the termination of the related capital
leases, which will occur at various times from 2007 to 2010. The
purchase price will be based on the unamortized portion of the
vessel construction financing costs for the vessels, which we
expect to range from $39.4&nbsp;million to $41.9&nbsp;million
per vessel. We expect to finance these purchases by assuming the
existing vessel financing.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We and Teekay Shipping Corporation regularly evaluate and pursue
opportunities to provide the marine transportation requirements
for new or expanding LNG projects. The award process relating to
LNG transportation opportunities typically involves various
stages and takes several months to complete. Neither we nor
Teekay Shipping Corporation may be awarded charters relating to
any of the projects we or it pursues. If any LNG project
charters are awarded to Teekay Shipping Corporation, it must
offer them to us pursuant to the terms of the omnibus agreement
we entered into in May 2005 at the closing of our initial public
offering of common units. In July and August 2005, Teekay
Shipping Corporation announced the awards to it of a 70%
interest in two LNG carriers and related long-term, fixed-rate
time charters to service the Tangguh LNG project in Indonesia
and a 40% interest in four LNG carriers and related long-term,
fixed-rate time charters to service an LNG project in Qatar. In
connection with these awards, Teekay Shipping Corporation has
(a)&nbsp;exercised shipbuilding options to construct two 155,000
cubic meter LNG carriers at a total delivered cost of
approximately $450&nbsp;million, which vessels are scheduled to
deliver in late 2008 and early 2009, respectively, and
(b)&nbsp;entered into agreements to construct four 217,000 cubic
meter LNG carriers at a total delivered cost of approximately
$1.1&nbsp;billion, which vessels are scheduled to deliver in the
first half of 2008.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If we elect pursuant to the omnibus agreement to obtain Teekay
Shipping Corporation&#146;s interests in either or both of these
LNG projects or any other projects Teekay Shipping Corporation
may be awarded, or if we bid on and are awarded contracts
relating to any LNG project, we will need to incur significant
capital expenditures to buy Teekay Shipping Corporation&#146;s
interest in these LNG projects or to build the LNG carriers.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
To fund the remaining portion of these and other capital
expenditures, we will be required to use cash from operations or
incur borrowings or raise capital through the sale of debt or
additional equity securities. Use of cash from operations will
reduce cash available to make required payments on our debt
securities and for distributions to our unitholders. Our ability
to obtain bank financing or to access the capital markets for
future offerings may be limited by our financial condition at
the time of any such financing or offerings as well as by
adverse market conditions resulting from, among other things,
general economic conditions and contingencies and uncertainties
that are beyond our control. Our failure to obtain the funds for
necessary future capital expenditures could have a material
adverse effect on our business, results of operations and
financial condition and on our ability to make required payments
on our debt securities and cash distributions on our common
units. Even if we are successful in obtaining necessary funds,
the terms of such financings could limit our ability to make
required payments on our debt securities or pay cash
distributions to our unitholders. In addition, incurring
additional debt may significantly increase our interest expense
and financial leverage, and issuing additional equity securities
may result in significant unitholder dilution and would increase
the aggregate amount of cash required to meet our minimum
quarterly distribution to unitholders, which could have a
material adverse effect on our ability to make required payments
on our debt securities and cash distributions on our common
units.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If we were unable to obtain financing required to complete
payments on any future newbuilding orders, we could effectively
forfeit all or a portion of the progress payments previously
made.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We derive a substantial majority of our revenues from a
    limited number of customers, and the loss of any customer, time
    charter or vessel could result in a significant loss of revenues
    and cash flow.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have derived, and believe that we will continue to derive, a
significant portion of our revenues and cash flow from a limited
number of customers. Compania Espanola de Petroleos, S.A. (or
<I>CEPSA</I>), an international oil company, accounted for
approximately 47%, 36%, 30% and 30% of our revenues during 2003,
2004, 2005 and the first half of 2006, respectively. In
addition, two other customers, Spanish energy
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">9

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
companies Repsol YPF, S.A. and Gas Natural SDG, S.A., accounted
for 26% and 11% of our revenues in 2003, 18% and 21% of our
revenues in 2004, 33% and 18% of our revenues in 2005 and 28%
and 12% of our revenues in the first half of 2006, respectively.
In addition, Uni&#243;n Fenosa Gas, S.A. accounted for 16% of
our revenues in 2005 and 13% of our revenues in the first half
of 2006. As a result of our acquisition of the three Suezmax
tankers (or the <I>ConocoPhillips Tankers</I>) from Teekay
Shipping Corporation upon the closing of our follow-on public
offering in November 2005, we derived 17% of our revenues in the
first half of 2006 from a ConocoPhillips subsidiary, the
customer under the related time charter contracts. No other
customer accounted for 10% or more of our revenues during any of
these periods. Ras Laffan Liquefied Natural Gas Co. Limited (II)
(or <I>RasGas&nbsp;II</I>) will be a significant customer
following the delivery in 2006 and 2007 of three LNG
newbuildings that we will operate under
<FONT style="white-space: nowrap">20-year</FONT> time charters
with RasGas&nbsp;II following our purchase of Teekay Shipping
Corporation&#146;s 70% interest in Teekay Nakilat, which owns
the three subsidiaries that will lease the vessels under capital
leases.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We could lose a customer or the benefits of a time charter if:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the customer fails to make charter payments because of its
    financial inability, disagreements with us or otherwise;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the customer exercises certain rights to terminate the charter,
    purchase or cause the sale of the vessel or, under some of our
    charters, convert the time charter to a bareboat charter (some
    of which rights are exercisable at any time);</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the customer terminates the charter because we fail to deliver
    the vessel within a fixed period of time, the vessel is lost or
    damaged beyond repair, there are serious deficiencies in the
    vessel or prolonged periods of off-hire, or we default under the
    charter;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    under some of our time charters, the customer terminates the
    charter because of the termination of the charterer&#146;s LNG
    sales agreement supplying the LNG designated for our services,
    or a prolonged force majeure event affecting the customer,
    including damage to or destruction of relevant LNG production or
    regasification facilities, war or political unrest preventing us
    from performing services for that customer.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If we lose a key LNG time charter, we may be unable to re-deploy
the related vessel on terms as favorable to us due to the
long-term nature of most LNG time charters and the lack of an
established LNG spot market. If we are unable to re-deploy an
LNG carrier, we will not receive any revenues from that vessel,
but we may be required to pay expenses necessary to maintain the
vessel in proper operating condition. In addition, if a customer
exercises its right to purchase a vessel, we would not receive
any further revenue from the vessel and may be unable to obtain
a substitute vessel and charter. This may cause us to receive
decreased revenue and cash flows from having fewer vessels
operating in our fleet. Any compensation under our charters for
a purchase of the vessels may not adequately compensate us for
the loss of the vessel and related time charter.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If we lose a key Suezmax tanker customer, we may be unable to
obtain other long-term Suezmax charters and may become subject
to the volatile spot market, which is highly competitive and
subject to significant price fluctuations. If a customer
exercises its right under some charters to purchase or force a
sale of the vessel, we may be unable to acquire an adequate
replacement vessel or may be forced to construct a new vessel.
Any replacement newbuilding would not generate revenues during
its construction and we may be unable to charter any replacement
vessel on terms as favorable to us as those of the terminated
charter.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The loss of any of our customers, time charters or vessels, or a
decline in payments under our charters, could have a material
adverse effect on our business, results of operations and
financial condition and our ability to make required payments on
our debt securities and distributions on our common units.
</DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We depend on Teekay Shipping Corporation to assist us in
    operating our business, competing in our markets, and providing
    interim financing for certain vessel acquisitions.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Pursuant to certain services agreements between us and certain
of our operating subsidiaries, on the one hand, and certain
subsidiaries of Teekay Shipping Corporation, on the other hand,
the Teekay Shipping Corporation subsidiaries provide to us
administrative services and to our operating subsidiaries
significant operational services (including vessel maintenance,
crewing for some of our vessels, purchasing, shipyard
supervision, insurance and financial services) and other
technical, advisory and administrative services. Our operational
success and ability to execute our growth strategy depend
significantly upon Teekay Shipping Corporation&#146;s
satisfactory performance of these services. Our business will be
harmed if Teekay Shipping Corporation fails to perform these
services satisfactorily or if Teekay Shipping Corporation stops
providing these services to us.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our ability to compete for the transportation requirements of
LNG projects and to enter into new time charters and expand our
customer relationships depends largely on our ability to
leverage our relationship with Teekay Shipping Corporation and
its reputation and relationships in the shipping industry. If
Teekay Shipping Corporation suffers material damage to its
reputation or relationships it may harm our ability to:
</DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    renew existing charters upon their expiration;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    obtain new charters;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    successfully interact with shipyards during periods of shipyard
    construction constraints;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    obtain financing on commercially acceptable terms;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    maintain satisfactory relationships with our employees and
    suppliers.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If our ability to do any of the things described above is
impaired, it could have a material adverse effect on our
business, results of operations and financial condition and our
ability to make required payments on our debt securities and
cash distributions on our common units.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Prior to entering into capital leases with respect to the three
RasGas&nbsp;II LNG newbuildings, Teekay Shipping Corporation was
incurring all costs for the construction and delivery of the
vessels, which we refer to as &#147;warehousing.&#148; Upon
their delivery, we would have purchased all of the interest of
Teekay Shipping Corporation in the vessels at a price that would
reimburse Teekay Shipping Corporation for these costs and
compensate it for its average weighted cost of capital on the
construction payments. We may enter into similar arrangements
with Teekay Shipping Corporation or third parties in the future.
If Teekay Shipping Corporation or another warehousing partner
fails to make construction payments for any vessels that may be
warehoused for us, we could lose access to the vessels as a
result of the default or we may need to finance these vessels
before they begin operating and generating voyage revenues,
which could harm our business and reduce our ability to make
required payments on our debt securities and cash distributions
on our common units.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Our growth depends on continued growth in demand for LNG
    and LNG shipping.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our growth strategy focuses on continued expansion in the LNG
shipping sector. Accordingly, our growth depends on continued
growth in world and regional demand for LNG and LNG shipping,
which could be negatively affected by a number of factors, such
as:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    increases in the cost of natural gas derived from LNG relative
    to the cost of natural gas generally;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    increases in the production of natural gas in areas linked by
    pipelines to consuming areas, the extension of existing, or the
    development of new, pipeline systems in markets we may serve, or
    the conversion of existing non-natural gas pipelines to natural
    gas pipelines in those markets;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    decreases in the consumption of natural gas due to increases in
    its price relative to other energy sources or other factors
    making consumption of natural gas less attractive;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">11

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    availability of new, alternative energy sources, including
    compressed natural gas;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    negative global or regional economic or political conditions,
    particularly in LNG consuming regions, which could reduce energy
    consumption or its growth.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Reduced demand for LNG and LNG shipping would have a material
adverse effect on our future growth and could harm our business,
results of operations and financial condition.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Growth of the LNG market may be limited by infrastructure
    constraints and community environmental group resistance to new
    LNG infrastructure over concerns about the environment, safety
    and terrorism.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A complete LNG project includes production, liquefaction,
regasification, storage and distribution facilities and LNG
carriers. Existing LNG projects and infrastructure are limited,
and new or expanded LNG projects are highly complex and
capital-intensive, with new projects often costing several
billion dollars. Many factors could negatively affect continued
development of LNG infrastructure or disrupt the supply of LNG,
including:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    increases in interest rates or other events that may affect the
    availability of sufficient financing for LNG projects on
    commercially reasonable terms;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    decreases in the price of LNG, which might decrease the expected
    returns relating to investments in LNG projects;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the inability of project owners or operators to obtain
    governmental approvals to construct or operate LNG facilities;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    local community resistance to proposed or existing LNG
    facilities based on safety, environmental or security concerns;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    any significant explosion, spill or similar incident involving
    an LNG facility or LNG carrier;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    labor or political unrest affecting existing or proposed areas
    of LNG production;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    capacity constraints at existing shipyards, which are expected
    to continue until at least the end of 2008.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If the LNG supply chain is disrupted or does not continue to
grow, or if a significant LNG explosion, spill or similar
incident occurs, it could have a material adverse effect on our
business, results of operations and financial condition and our
ability to make required payments on our debt securities and
cash distributions on our common units.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Our growth depends on our ability to expand relationships
    with existing customers and obtain new customers, for which we
    will face substantial competition.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
One of our principal objectives is to enter into additional
long-term, fixed-rate LNG time charters. The process of
obtaining new long-term LNG time charters is highly competitive
and generally involves an intensive screening process and
competitive bids, and often extends for several months. LNG
shipping contracts are awarded based upon a variety of factors
relating to the vessel operator, including:
</DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    shipping industry relationships and reputation for customer
    service and safety;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    LNG shipping experience and quality of ship operations
    (including cost effectiveness);</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    quality and experience of seafaring crew;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the ability to finance LNG carriers at competitive rates and
    financial stability generally;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    relationships with shipyards and the ability to get suitable
    berths;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    construction management experience, including the ability to
    obtain on-time delivery of new vessels according to customer
    specifications;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">12

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    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    willingness to accept operational risks pursuant to the charter,
    such as allowing termination of the charter for force majeure
    events;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    competitiveness of the bid in terms of overall price.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We compete for providing marine transportation services for
potential LNG projects with a number of experienced companies,
including state-sponsored entities and major energy companies
affiliated with the LNG project requiring LNG shipping services.
Many of these competitors have significantly greater financial
resources than we do or Teekay Shipping Corporation does. We
anticipate that an increasing number of marine transportation
companies&nbsp;&#151; including many with strong reputations and
extensive resources and experience&nbsp;&#151; will enter the
LNG transportation sector. This increased competition may cause
greater price competition for time charters. As a result of
these factors, we may be unable to expand our relationships with
existing customers or to obtain new customers on a profitable
basis, if at all, which would have a material adverse effect on
our business, results of operations and financial condition and
our ability to make required payments on our debt securities and
cash distributions on our common units.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Delays in deliveries of newbuildings could harm our
    operating results and lead to the termination of related time
    charters.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have agreed to purchase Teekay Shipping Corporation&#146;s
70% interest in Teekay Nakilat Corporation, which through its
subsidiaries will lease under capital leases the three
RasGas&nbsp;II LNG newbuilding carriers, in connection with
their deliveries scheduled for the fourth quarter of 2006 and
the first half of 2007. The delivery of these vessels, or any
other newbuildings we may order or otherwise acquire, could be
delayed, which would delay our receipt of revenues under the
time charters for the vessels. In addition, under some of our
charters if our delivery of a vessel to our customer is delayed,
we may be required to pay liquidated damages in amounts equal to
or, under some charters, almost double, the hire rate during the
delay. For prolonged delays, the customer may terminate the time
charter and, in addition to the resulting loss of revenues, we
may be responsible for additional, substantial liquidated
damages.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our receipt of newbuildings could be delayed because of:
</DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    quality or engineering problems;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    changes in governmental regulations or maritime self-regulatory
    organization standards;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    work stoppages or other labor disturbances at the shipyard;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    bankruptcy or other financial crisis of the shipbuilder;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    a backlog of orders at the shipyard;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    political or economic disturbances in South Korea or other
    locations where our vessels are being or may be built;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    weather interference or catastrophic event, such as a major
    earthquake or fire;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our requests for changes to the original vessel specifications;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    shortages of or delays in the receipt of necessary construction
    materials, such as steel;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our inability to finance the purchase of the vessels;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our inability to obtain requisite permits or approvals.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If delivery of a vessel is materially delayed, it could
adversely affect our results or operations and financial
condition and our ability to make required payments on our debt
securities and cash distributions on our common units.
</DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We may have more difficulty entering into long-term,
    fixed-rate time charters if an active short-term or spot LNG
    shipping market develops.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
LNG shipping historically has been transacted with long-term,
fixed-rate time charters, usually with terms ranging from 20 to
25&nbsp;years. One of our principal strategies is to enter into
additional long-term, fixed-rate LNG time charters. However, the
number of spot and short-term charters has been increasing, with
LNG charters under 12&nbsp;months in duration growing from less
than 2% of the market in the late 1990s to approximately 13% in
2005.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If an active spot or short-term market continues to develop, we
may have increased difficulty entering into long-term,
fixed-rate time charters for our LNG vessels and, as a result,
our cash flow may decrease and be less stable. In addition, an
active short-term or spot LNG market may require us to enter
into charters based on changing market prices, as opposed to
contracts based on a fixed rate, which could result in a
decrease in our cash flow in periods when the market price for
shipping LNG is depressed or insufficient funds are available to
cover our financing costs for related vessels.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Over time vessel values may fluctuate substantially and,
    if these values are lower at a time when we are attempting to
    dispose of a vessel, we may incur a loss.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Vessel values for LNG carriers and Suezmax oil tankers can
fluctuate substantially over time due to a number of different
factors, including:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    prevailing economic conditions in natural gas, oil and energy
    markets;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    a substantial or extended decline in demand for natural gas, LNG
    or oil;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    increases in the supply of vessel capacity;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the cost of retrofitting or modifying existing vessels, as a
    result of technological advances in vessel design or equipment,
    changes in applicable environmental or other regulation or
    standards, or otherwise.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If a charter terminates, we may be unable to re-deploy the
vessel at attractive rates and, rather than continue to incur
costs to maintain and finance it, may seek to dispose of it. Our
inability to dispose of the vessel at a reasonable value could
result in a loss on its sale and adversely affect our results of
operations and financial condition.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We may be unable to make or realize expected benefits from
    acquisitions, and implementing our growth strategy through
    acquisitions may harm our business, financial condition and
    operating results.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our growth strategy includes selectively acquiring existing LNG
carriers or LNG shipping businesses. Historically, there have
been very few purchases of existing vessels and businesses in
the LNG shipping industry. Factors that may contribute to a
limited number of acquisition opportunities in the LNG industry
in the near term include the relatively small number of
independent LNG fleet owners and the limited number of LNG
carriers not subject to existing long-term charter contracts. In
addition, competition from other companies could reduce our
acquisition opportunities or cause us to pay higher prices.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Any acquisition of a vessel or business may not be profitable to
us at or after the time we acquire it and may not generate cash
flow sufficient to justify our investment. In addition, our
acquisition growth strategy exposes us to risks that may harm
our business, financial condition and operating results,
including risks that we may:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    fail to realize anticipated benefits, such as new customer
    relationships, cost-savings or cash flow enhancements;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    be unable to hire, train or retain qualified shore and seafaring
    personnel to manage and operate our growing business and fleet;</TD>
</TR>

</TABLE>

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<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    decrease our liquidity by using a significant portion of our
    available cash or borrowing capacity to finance acquisitions;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    significantly increase our interest expense or financial
    leverage if we incur additional debt to finance acquisitions;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    incur or assume unanticipated liabilities, losses or costs
    associated with the business or vessels acquired;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    incur other significant charges, such as impairment of goodwill
    or other intangible assets, asset devaluation or restructuring
    charges.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Unlike newbuildings, existing vessels typically do not carry
warranties as to their condition. While we generally inspect
existing vessels prior to purchase, such an inspection would
normally not provide us with as much knowledge of a
vessel&#146;s condition as we would possess if it had been built
for us and operated by us during its life. Repairs and
maintenance costs for existing vessels are difficult to predict
and may be substantially higher than for vessels we have
operated since they were built. These costs could decrease our
cash flow and reduce our liquidity.
</DIV>

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    <TD width="3%"></TD>
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    <TD></TD>
    <TD>
    <B><I>Terrorist attacks, increased hostilities or war could lead
    to further economic instability, increased costs and disruption
    of our business.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Terrorist attacks, such as the attacks that occurred in the
United States on September&nbsp;11, 2001 and the bombings in
Spain on March&nbsp;11, 2004 and in England on July&nbsp;7,
2005, and the current conflicts in Iraq and Afghanistan and
other current and future conflicts, may adversely affect our
business, operating results, financial condition, ability to
raise capital and future growth. Continuing hostilities in the
Middle East may lead to additional armed conflicts or to further
acts of terrorism and civil disturbance in the United States,
Spain or elsewhere, which may contribute further to economic
instability and disruption of LNG and oil production and
distribution, which could result in reduced demand for our
services.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, LNG and oil facilities, shipyards, vessels,
pipelines and oil and gas fields could be targets of future
terrorist attacks. Any such attacks could lead to, among other
things, bodily injury or loss of life, vessel or other property
damage, increased vessel operational costs, including insurance
costs, and the inability to transport LNG, natural gas and oil
to or from certain locations. Terrorist attacks, war or other
events beyond our control that adversely affect the
distribution, production or transportation of LNG or oil to be
shipped by us could entitle our customers to terminate our
charter contracts, which would harm our cash flow and our
business.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Terrorist attacks, or the perception that LNG facilities and LNG
carriers are potential terrorist targets, could materially and
adversely affect expansion of LNG infrastructure and the
continued supply of LNG to the United States and other
countries. Concern that LNG facilities may be targeted for
attack by terrorists has contributed to significant community
and environmental resistance to the construction of a number of
LNG facilities, primarily in North America. If a terrorist
incident involving an LNG facility or LNG carrier did occur, in
addition to the possible effects identified in the previous
paragraph, the incident may adversely affect construction of
additional LNG facilities in the United States and other
countries or result in the temporary or permanent closing of
various LNG facilities currently in operation.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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    <TD width="3%"></TD>
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<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Our substantial operations outside the United States
    expose us to political, governmental and economic instability,
    which could harm our operations.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Because our operations are primarily conducted outside of the
United States, they may be affected by economic, political and
governmental conditions in the countries where we are engaged in
business or where our vessels are registered. Any disruption
caused by these factors could harm our business. In particular,
we derive a substantial portion of our revenues from shipping
LNG and oil from politically unstable regions. Past political
conflicts in these regions, particularly in the Arabian Gulf,
have included attacks on ships, mining of waterways and other
efforts to disrupt shipping in the area. In addition to acts of
terrorism, vessels trading in this and other regions have also
been subject, in limited instances, to piracy.
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Future hostilities or other political instability in the Arabian
Gulf or other regions where we operate or may operate could have
a material adverse effect on the growth of our business, results
of operations and financial condition and our ability to make
required payments on our debt securities and cash distributions
on our common units. In addition, tariffs, trade embargoes and
other economic sanctions by Spain, the United States or other
countries against countries in the Middle East, Southeast Asia
or elsewhere as a result of terrorist attacks, hostilities or
otherwise may limit trading activities with those countries,
which could also harm our business and ability to make cash
distributions.
</DIV>

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    <TD width="3%"></TD>
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    <TD></TD>
    <TD>
    <B><I>Marine transportation is inherently risky, and an incident
    involving significant loss of or environmental contamination by
    any of our vessels could harm our reputation and
    business.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our vessels and their cargoes are at risk of being damaged or
lost because of events such as:
</DIV>

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    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    marine disasters;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    bad weather;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    mechanical failures;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    grounding, fire, explosions and collisions;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    piracy;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    human error;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    war and terrorism.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
An accident involving any of our vessels could result in any of
the following:
</DIV>

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    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    death or injury to persons, loss of property or environmental
    damage;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    delays in the delivery of cargo;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    loss of revenues from or termination of charter contracts;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    governmental fines, penalties or restrictions on conducting
    business;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    higher insurance rates;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    damage to our reputation and customer relationships generally.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Any of these results could have a material adverse effect on our
business, financial condition and operating results.
</DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Our insurance may be insufficient to cover losses that may
    occur to our property or result from our operations.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The operation of LNG carriers and oil tankers is inherently
risky. Although we carry hull and machinery (marine and war
risks) and protection and indemnity insurance, all risks may not
be adequately insured against, and any particular claim may not
be paid. In addition, we do not carry insurance on our oil
tankers covering the loss of revenues resulting from vessel
off-hire time based on its cost compared to our off-hire
experience. Commencing January&nbsp;1, 2006, Teekay Shipping
Corporation began providing off-hire insurance for our LNG
carriers. Any claims covered by insurance would be subject to
deductibles, and since it is possible that a large number of
claims may be brought, the aggregate amount of these deductibles
could be material. Certain of our insurance coverage is
maintained through mutual protection and indemnity associations,
and as a member of such associations we may be required to make
additional payments over and above budgeted premiums if member
claims exceed association reserves.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We may be unable to procure adequate insurance coverage at
commercially reasonable rates in the future. For example, more
stringent environmental regulations have led in the past to
increased costs for, and in the future may result in the lack of
availability of, insurance against risks of environmental damage
or pollution. A catastrophic oil spill or marine disaster could
result in losses that exceed our insurance
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">16

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
coverage, which could harm our business, financial condition and
operating results. Any uninsured or underinsured loss could harm
our business and financial condition. In addition, our insurance
may be voidable by the insurers as a result of certain of our
actions, such as our ships failing to maintain certification
with applicable maritime self-regulatory organizations.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Changes in the insurance markets attributable to terrorist
attacks may also make certain types of insurance more difficult
for us to obtain. In addition, the insurance that may be
available may be significantly more expensive than our existing
coverage.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>The marine energy transportation industry is subject to
    substantial environmental and other regulations, which may
    significantly limit our operations or increase our
    expenses.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our operations are affected by extensive and changing
environmental protection laws and other regulations and
international conventions. We have incurred, and expect to
continue to incur, substantial expenses in complying with these
laws and regulations, including expenses for vessel
modifications and changes in operating procedures. Additional
laws and regulations may be adopted that could limit our ability
to do business or further increase our costs. In addition,
failure to comply with applicable laws and regulations may
result in administrative and civil penalties, criminal sanctions
or the suspension or termination of our operations.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The United States Oil Pollution Act of 1990 (or <I>OPA 90</I>),
for instance, increased expenses for us and others in our
industry. OPA&nbsp;90 provides for potentially unlimited joint,
several and strict liability for owners, operators and demise or
bareboat charterers for oil pollution and related damages in
U.S.&nbsp;waters, which include the U.S.&nbsp;territorial sea
and the 200-nautical mile exclusive economic zone around the
United States. OPA&nbsp;90 applies to discharges of any oil from
a vessel, including discharges of oil tanker cargoes and
discharges of fuel and lubricants from an oil tanker or LNG
carrier. To comply with OPA&nbsp;90, vessel owners generally
incur increased costs in meeting additional maintenance and
inspection requirements, in developing contingency arrangements
for potential spills and in obtaining required insurance
coverage. OPA&nbsp;90 requires vessel owners and operators of
vessels operating in U.S.&nbsp;waters to establish and maintain
with the U.S.&nbsp;Coast Guard evidence of insurance or of
qualification as a self-insurer or other acceptable evidence of
financial responsibility sufficient to meet certain potential
liabilities under OPA&nbsp;90 and the U.S.&nbsp;Comprehensive
Environmental Response, Compensation, and Liability Act (or
<I>CERCLA</I>), which imposes similar liabilities upon owners,
operators and bareboat charterers of vessels from which a
discharge of &#147;hazardous substances&#148; (other than oil)
occurs. While LNG should not be considered a hazardous substance
under CERCLA, additives to fuel oil or lubricants used on LNG
carriers might fall within its scope. Under OPA&nbsp;90 and
CERCLA, owners, operators and bareboat charterers are jointly,
severally and strictly liable for costs of cleanup and damages
resulting from a discharge or threatened discharge within
U.S.&nbsp;waters. This means we may be subject to liability even
if we are not negligent or at fault.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Most states in the United States bordering on a navigable
waterway have enacted legislation providing for potentially
unlimited strict liability without regard to fault for the
discharge of pollutants within their waters. An oil spill or
other event could result in significant liability, including
fines, penalties, criminal liability and costs for natural
resource damages. The potential for these releases could
increase to the extent we increase our operations in
U.S.&nbsp;waters.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
OPA&nbsp;90 and CERCLA do not preclude claimants from seeking
damages for the discharge of oil and hazardous substances under
other applicable law, including maritime tort law. Such claims
could include attempts to characterize seaborne transportation
of LNG as an ultra-hazardous activity, which attempts, if
successful, would lead to our being strictly liable for damages
resulting from that activity.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, we believe that the heightened environmental,
quality and security concerns of insurance underwriters,
regulators and charterers will generally lead to additional
regulatory requirements, including enhanced risk assessment and
security requirements and greater inspection and safety
requirements on all vessels in the LNG carrier and oil tanker
markets.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">17

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    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Exposure to currency exchange rate fluctuations will
    result in fluctuations in our cash flows and operating
    results.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are paid in Euros under some of our charters, and a majority
of our vessel operating expenses and general and administrative
expenses currently are denominated in Euros, which is primarily
a function of the nationality of our crew and administrative
staff. We also make payments under two Euro-denominated term
loans. If the amount of our Euro-denominated obligations exceeds
our Euro-denominated revenues, we must convert other currencies,
primarily the U.S.&nbsp;Dollar, into Euros. An increase in the
strength of the Euro relative to the U.S.&nbsp;Dollar would
require us to convert more U.S.&nbsp;Dollars to Euros to satisfy
those obligations, which would cause us to have less cash
available to make required payments on our debt securities and
for distribution on our common units. In addition, if we do not
have sufficient U.S.&nbsp;Dollars, we may be required to convert
Euros into U.S.&nbsp;Dollars for payments under any
U.S.&nbsp;Dollar-denominated debt securities or for
distributions to unitholders. An increase in the strength of the
U.S.&nbsp;Dollar relative to the Euro could cause us to have
less cash available for these payments and distributions in this
circumstance. We have not entered into currency swaps or forward
contracts or similar derivatives to mitigate this risk.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Because we report our operating results in U.S.&nbsp;Dollars,
changes in the value of the U.S.&nbsp;Dollar relative to the
Euro also result in fluctuations in our reported revenues and
earnings. In addition, under U.S.&nbsp;accounting guidelines,
all foreign currency-denominated monetary assets and liabilities
such as cash and cash equivalents, accounts receivable,
restricted cash, accounts payable, long-term debt and capital
lease obligations are revalued and reported based on the
prevailing exchange rate at the end of the period. This
revaluation historically has caused us to report significant
non-monetary foreign currency exchange gains or losses each
period. The primary source for these gains and losses is our
Euro-denominated term loans. In 2003 and 2004 and the first half
of 2006, we reported foreign currency exchange losses of
$71.5&nbsp;million, $60.8&nbsp;million and $28.2&nbsp;million,
respectively. In 2005, we reported a foreign currency exchange
gain of $81.8&nbsp;million.
</DIV>

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</TR>

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    <TD></TD>
    <TD>
    <B><I>Many of our seafaring employees are covered by collective
    bargaining agreements and the failure to renew those agreements
    or any future labor agreements may disrupt our operations and
    adversely affect our cash flows.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A significant portion of our seafarers, and the seafarers
employed by Teekay Shipping Corporation and its other affiliates
that crew our vessels, are employed under collective bargaining
agreements, which expire at varying times through 2008. The
collective bargaining agreement for our Spanish Suezmax tanker
crew members (covering five Suezmax tankers) expires at the end
of 2008. We may be subject to similar labor agreements in the
future. We may be subject to labor disruptions in the future if
our relationships deteriorate with our seafarers or the unions
that represent them. Our collective bargaining agreements may
not prevent labor disruptions, particularly when the agreements
are being renegotiated. Any labor disruptions could harm our
operations and could have a material adverse effect on our
business, results of operations and financial condition and our
ability to make required payments on our debt securities and
cash distributions on our common units.
</DIV>

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    <TD>
    <B><I>Due to our lack of diversification, adverse developments
    in our LNG or oil marine transportation business could reduce
    our ability to make required payments on our debt securities and
    distributions to our unitholders.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We rely exclusively on the cash flow generated from our LNG
carriers and Suezmax oil tankers that operate in the LNG and oil
marine transportation business. Due to our lack of
diversification, an adverse development in the LNG or oil
shipping industry would have a significantly greater impact on
our financial condition and results of operations than if we
maintained more diverse assets or lines of business.
</DIV>

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<A name='110'></A>
</DIV>

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<B>Risks Inherent in an Investment in Us</B>
</DIV>

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    <TD>
    <B><I>Teekay Shipping Corporation and its affiliates may engage
    in competition with us.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Teekay Shipping Corporation and its affiliates may engage in
competition with us. Pursuant to the omnibus agreement, Teekay
Shipping Corporation and its controlled affiliates (other than
us and our subsidiaries) generally have agreed not to own,
operate or charter LNG carriers without the consent of our
general partner. The omnibus agreement, however, allows Teekay
Shipping Corporation or any of such controlled affiliates to:
</DIV>

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    <TD width="1%"></TD>
    <TD width="96%"></TD>
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<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    acquire LNG carriers and related time charters as part of a
    business if a majority of the value of the total assets or
    business acquired is not attributable to the LNG carriers and
    time charters, as determined in good faith by the board of
    directors of Teekay Shipping Corporation; however, if at any
    time Teekay Shipping Corporation completes such an acquisition,
    it must offer to sell the LNG carriers and related time charters
    to us for their fair market value plus any additional tax or
    other similar costs to Teekay Shipping Corporation that would be
    required to transfer the LNG carriers and time charters to us
    separately from the acquired business;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    own, operate and charter LNG carriers that relate to a bid or
    award for a proposed LNG project that Teekay Shipping
    Corporation or any of its subsidiaries has submitted or
    hereafter submits or receives; however, at least 180&nbsp;days
    prior to the scheduled delivery date of any such LNG carrier,
    Teekay Shipping Corporation must offer to sell the LNG carrier
    and related time charter to us, with the vessel valued at its
    &#147;fully<FONT style="white-space: nowrap">-built-up</FONT>
    cost,&#148; which represents the aggregate expenditures incurred
    (or to be incurred prior to delivery to us) by Teekay Shipping
    Corporation to acquire or construct and bring such LNG carrier
    to the condition and location necessary for our intended use.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If we decline the offer to purchase the LNG carriers and time
charters described above, Teekay Shipping Corporation may own
and operate the LNG carriers, but may not expand that portion of
its business.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, pursuant to the omnibus agreement, Teekay Shipping
Corporation or any of its controlled affiliates (other than us
and our subsidiaries) may:
</DIV>

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    <TD width="96%"></TD>
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<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    acquire, operate or charter LNG carriers if our general partner
    has previously advised Teekay Shipping Corporation that the
    board of directors of our general partner has elected, with the
    approval of its conflicts committee, not to cause us or our
    subsidiaries to acquire or operate the carriers;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    operate the three RasGas&nbsp;II LNG newbuilding carriers and
    related time charters if we fail to perform our obligation to
    purchase such vessels under our agreement with Teekay Shipping
    Corporation;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    acquire up to a 9.9% equity ownership, voting or profit
    participation interest in any publicly traded company that owns
    or operate LNG carriers;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    provide ship management services relating to LNG carriers.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If there is a change of control of Teekay Shipping Corporation,
the non-competition provisions of the omnibus agreement may
terminate, which termination could have a material adverse
effect on our business, results of operations and financial
condition and our ability to make required payments on our debt
securities and cash distributions on our common units.
</DIV>

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    <TD width="97%"></TD>
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    <TD></TD>
    <TD>
    <B><I>Our general partner and its other affiliates have
    conflicts of interest and limited fiduciary duties, which may
    permit them to favor their own interests to those of our
    securityholders.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Teekay Shipping Corporation, which owns and controls our general
partner, indirectly owns the 2% general partner interest and
currently owns a 67.8% limited partner interest in us. Conflicts
of interest may arise between Teekay Shipping Corporation and
its affiliates, including our general partner, on the one hand,
and us and our securityholders, on the other hand. As a result
of these conflicts, our general partner
</DIV>

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may favor its own interests and the interests of its affiliates
over the interests of our securityholders. These conflicts
include, among others, the following situations:
</DIV>

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    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
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    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    neither our partnership agreement nor any other agreement
    requires our general partner or Teekay Shipping Corporation to
    pursue a business strategy that favors us or utilizes our
    assets, and Teekay Shipping Corporation&#146;s officers and
    directors have a fiduciary duty to make decisions in the best
    interests of the stockholders of Teekay Shipping Corporation,
    which may be contrary to our interests;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the executive officers and three of the directors of our general
    partner also currently serve as executive officers or directors
    of Teekay Shipping Corporation and another director of our
    general partner is employed by an affiliate of Teekay Shipping
    Corporation;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our general partner is allowed to take into account the
    interests of parties other than us, such as Teekay Shipping
    Corporation, in resolving conflicts of interest, which has the
    effect of limiting its fiduciary duty to our unitholders;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our general partner has limited its liability and reduced its
    fiduciary duties under the laws of the Marshall Islands, while
    also restricting the remedies available to our unitholders, and
    as a result of purchasing common units, unitholders are treated
    as having agreed to the modified standard of fiduciary duties
    and to certain actions that may be taken by our general partner,
    all as set forth in the partnership agreement;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our general partner determines the amount and timing of asset
    purchases and sales, capital expenditures, borrowings, issuances
    of additional partnership securities and reserves, each of which
    can affect the amount of cash that is available for required
    payments on our debt securities and distribution to our
    unitholders;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    in some instances, our general partner may cause us to borrow
    funds in order to permit the payment of cash distributions, even
    if the purpose or effect of the borrowing is to make a
    distribution on our subordinated units or to make incentive
    distributions or to accelerate the expiration of the
    subordination period;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our general partner determines which costs incurred by it and
    its affiliates are reimbursable by us;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our partnership agreement does not restrict our general partner
    from causing us to pay it or its affiliates for any services
    rendered to us on terms that are fair and reasonable or entering
    into additional contractual arrangements with any of these
    entities on our behalf;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our general partner controls the enforcement of obligations owed
    to us by it and its affiliates;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our general partner decides whether to retain separate counsel,
    accountants or others to perform services for us.</TD>
</TR>

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    <TD></TD>
    <TD>
    <B><I>Our partnership agreement limits our general
    partner&#146;s fiduciary duties to our unitholders and restricts
    the remedies available to unitholders for actions taken by our
    general partner.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our partnership agreement contains provisions that reduce the
standards to which our general partner would otherwise be held
by Marshall Islands law. For example, our partnership agreement:
</DIV>

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    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
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    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    permits our general partner to make a number of decisions in its
    individual capacity, as opposed to in its capacity as our
    general partner. Where our partnership agreement permits, our
    general partner may consider only the interests and factors that
    it desires, and in such cases it has no duty or obligation to
    give any consideration to any interest of, or factors affecting
    us, our affiliates or any limited partner;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    provides that our general partner is entitled to make other
    decisions in &#147;good faith&#148; if it reasonably believes
    that the decision is in our best interests;</TD>
</TR>

</TABLE>

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    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
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    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    generally provides that affiliated transactions and resolutions
    of conflicts of interest not approved by the conflicts committee
    of the board of directors of our general partner and not
    involving a vote of unitholders must be on terms no less
    favorable to us than those generally being provided to or
    available from unrelated third parties or be &#147;fair and
    reasonable&#148; to us and that, in determining whether a
    transaction or resolution is &#147;fair and reasonable,&#148;
    our general partner may consider the totality of the
    relationships between the parties involved, including other
    transactions that may be particularly advantageous or beneficial
    to us;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    provides that our general partner and its officers and directors
    will not be liable for monetary damages to us, our limited
    partners or assignees for any acts or omissions unless there has
    been a final and non-appealable judgment entered by a court of
    competent jurisdiction determining that the general partner or
    those other persons acted in bad faith or engaged in fraud,
    willful misconduct or gross negligence.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In order to become a limited partner of our partnership, a
common unitholder is required to agree to be bound by the
provisions in the partnership agreement, including the
provisions discussed above.
</DIV>

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    <TD></TD>
    <TD>
    <B><I>Fees and cost reimbursements, which our general partner
    determines for services provided to us and certain of our
    subsidiaries, are substantial and reduce our cash available to
    make required payments on our debt securities and for
    distribution to our common unitholders.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Prior to making any distribution on the common units, we pay
fees for services provided to us and certain of our subsidiaries
by certain subsidiaries of Teekay Shipping Corporation, and we
reimburse our general partner for all expenses it incurs on our
behalf. These fees are negotiated on our behalf by our general
partner, and our general partner also determines the amounts it
is reimbursed. These fees and expenses include all costs
incurred in providing certain advisory, ship management,
technical and administrative services to us and certain of our
subsidiaries. In addition, our general partner and its
affiliates may provide us with other services for which the
general partner or its affiliates may charge us fees, and we may
pay Teekay Shipping Corporation &#147;incentive fees&#148;
pursuant to the omnibus agreement with it to reward and motivate
Teekay Shipping Corporation for pursuing LNG projects that we
may elect to undertake. The payment of fees to Teekay Shipping
Corporation and its subsidiaries and reimbursement of expenses
to our general partner could adversely affect our ability to
make required payments on our debt securities and to pay cash
distributions to our common unitholders.
</DIV>

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    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Even if unitholders are dissatisfied, they cannot remove
    our general partner without its consent.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Unlike the holders of common stock in a corporation, unitholders
have only limited voting rights on matters affecting our
business and, therefore, limited ability to influence
management&#146;s decisions regarding our business. Unitholders
did not elect our general partner or its board of directors and
will have no right to elect our general partner or its board of
directors on an annual or other continuing basis. The board of
directors of our general partner is chosen by Teekay Shipping
Corporation. Furthermore, if the unitholders are dissatisfied
with the performance of our general partner, they will have
little ability to remove our general partner. As a result of
these limitations, the price at which the common units will
trade could be diminished because of the absence or reduction of
a takeover premium in the trading price.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The vote of the holders of at least
<FONT style="white-space: nowrap">66-</FONT><FONT style="font-size: 70%"><SUP>2</SUP></FONT>/<FONT style="font-size: 60%">3</FONT>%
of all outstanding units voting together as a single class is
required to remove the general partner. Teekay Shipping
Corporation currently owns 67.8% of our outstanding units. Also,
if the general partner is removed without cause during the
subordination period and units held by the general partner and
Teekay Shipping Corporation are not voted in favor of that
removal, all remaining subordinated units will automatically
convert into common units and any existing arrearages on the
common units will be extinguished. A removal of the general
partner under these circumstances would adversely affect the
common units by prematurely eliminating their distribution and
liquidation preference over the subordinated units, which would
otherwise have continued until we had met certain distribution
and performance tests. Cause is narrowly defined to mean that a
court of competent jurisdiction has entered a final,
non-appealable judgment finding the general partner liable for
actual fraud
</DIV>

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or willful or wanton misconduct in its capacity as our general
partner. Cause does not include most cases of charges of poor
management of the business, so the removal of the general
partner because of the unitholders&#146; dissatisfaction with
the general partner&#146;s performance in managing our
partnership will most likely result in the termination of the
subordination period.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Furthermore, unitholders&#146; voting rights are further
restricted by the partnership agreement provision providing that
any units held by a person that owns 20% or more of any class of
units then outstanding, other than the general partner, its
affiliates, their transferees, and persons who acquired such
units with the prior approval of the board of directors of the
general partner, cannot vote on any matter. Our partnership
agreement also contains provisions limiting the ability of
unitholders to call meetings or to acquire information about our
operations, as well as other provisions limiting the
unitholders&#146; ability to influence the manner or direction
of management.
</DIV>

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</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>The control of our general partner may be transferred to a
    third party without unitholder consent.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our general partner may transfer its general partner interest to
a third party in a merger or in a sale of all or substantially
all of its assets without the consent of the unitholders. In
addition, our partnership agreement does not restrict the
ability of the members of our general partner from transferring
their respective membership interests in our general partner to
a third party. In the event of any such transfer, the new
members of our general partner would be in a position to replace
the board of directors and officers of our general partner with
their own choices and to control the decisions taken by the
board of directors and officers.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Our financing agreements contain operating and financial
    restrictions which may restrict our business and financing
    activities.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The operating and financial restrictions and covenants in our
financing arrangements and any future financing agreements could
adversely affect our ability to finance future operations or
capital needs or to engage, expand or pursue our business
activities. For example, the arrangements may restrict our
ability to:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    incur or guarantee indebtedness;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    change ownership or structure, including mergers,
    consolidations, liquidations and dissolutions;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    make dividends or distributions;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    make capital expenditures in excess of specified levels;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    make certain negative pledges and grant certain liens;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    sell, transfer, assign or convey assets;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    make certain loans and investments;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    enter into a new line of business.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, some of our financing arrangements require our
subsidiaries to maintain restricted cash deposits and maintain
minimal levels of tangible net worth. Our ability to comply with
the covenants and restrictions contained in our debt instruments
may be affected by events beyond our control, including
prevailing economic, financial and industry conditions. If
market or other economic conditions deteriorate, our ability to
comply with these covenants may be impaired. If we are in breach
of any of the restrictions, covenants, ratios or tests in our
financing agreements, a significant portion of our obligations
may become immediately due and payable, and our lenders&#146;
commitment to make further loans to us may terminate. We might
not have, or be able to obtain, sufficient funds to make these
accelerated payments. In addition, our obligations under an
existing revolving credit facility are secured by certain of our
assets, and if we are unable to repay our debt under the credit
facility, the lenders could seek to foreclose on those assets.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">22

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<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Restrictions in our debt agreements may prevent us from
    paying distributions.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our payment of principal and interest on our debt and capital
lease obligations will reduce cash available for distribution on
our units. In addition, a number of our financing agreements
prohibit the payment of distributions upon the occurrence of the
following events, among others:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    failure to pay any principal, interest, fees, expenses or other
    amounts when due;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    default under any vessel mortgage;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    failure to notify the lenders of any material oil spill or
    discharge of hazardous material, or of any action or claim
    related thereto;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    breach or lapse of any insurance with respect to the vessels;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    breach of certain financial covenants;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    failure to observe any other agreement, security instrument,
    obligation or covenant beyond specified cure periods in certain
    cases;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    default under other indebtedness of our operating company, our
    general partner or any of our subsidiaries;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    bankruptcy or insolvency events involving us, our general
    partner or any of our subsidiaries;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    failure of any representation or warranty to be materially
    correct;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    a change of control, as defined in the applicable
    agreement;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    a material adverse effect, as defined in the applicable
    agreement, occurs relating to us or our business.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We anticipate that any subsequent refinancing of our current
debt or any new debt will have similar restrictions.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We can borrow money to pay distributions, which would
    reduce the amount of credit available to operate our
    business.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our partnership agreement allows us to make working capital
borrowings to pay distributions. Accordingly, we can make
distributions on all our units even though cash generated by our
operations may not be sufficient to pay such distributions. We
are required to reduce all working capital borrowings for this
purpose under our revolving credit agreement to zero for a
period of at least 15 consecutive days once each
<FONT style="white-space: nowrap">12-month</FONT> period. Any
working capital borrowings by us to make distributions will
reduce the amount of working capital borrowings we can make for
operating our business.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Unitholders may have liability to repay
    distributions.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Under some circumstances, unitholders may have to repay amounts
wrongfully distributed to them. Under the Marshall Islands
Limited Partnership Act (or <I>Marshall Islands Act</I>), we may
not make a distribution to our unitholders if the distribution
would cause our liabilities to exceed the fair value of our
assets. Marshall Islands law provides that for a period of three
years from the date of the impermissible distribution limited
partners who received the distribution and who knew at the time
of the distribution that it violated Marshall Islands law will
be liable to the limited partnership for the distribution
amount. Assignees of partnership interests who become limited
partners are liable for the obligations of the assignor to make
contributions to the partnership that are known to the assignee
at the time it became a limited partner and for unknown
obligations if the liabilities could be determined from the
partnership agreement. Liabilities to partners on account of
their partnership interest and liabilities that are non-recourse
to the partnership are not counted for purposes of determining
whether a distribution is permitted.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">23

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<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We have been organized as a limited partnership under the
    laws of the Republic of The Marshall Islands, which does not
    have a well-developed body of partnership law.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our partnership affairs are governed by our partnership
agreement and by the Marshall Islands Act. The provisions of the
Marshall Islands Act resemble provisions of the limited
partnership laws of a number of states in the United States,
most notably Delaware. The Marshall Islands Act also provides
that it is to be interpreted according to the non-statutory law
of the State of Delaware. There have been, however, few, if any,
court cases in the Marshall Islands interpreting the Marshall
Islands Act, in contrast to Delaware, which has a fairly
well-developed body of case law interpreting its limited
partnership statute. Accordingly, we cannot predict whether
Marshall Islands courts would reach the same conclusions as the
courts in Delaware. For example, the rights of our unitholders
and the fiduciary responsibilities of our general partner under
Marshall Islands law are not as clearly established as under
judicial precedent in existence in Delaware. As a result,
unitholders may have more difficulty in protecting their
interests in the face of actions by our general partner and its
officers and directors than would unitholders of a limited
partnership formed in the United States.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Because we are organized under the laws of the Marshall
    Islands, it may be difficult to serve us with legal process or
    enforce judgments against us, our directors or our
    management.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are organized under the laws of the Marshall Islands, and all
of our assets are located outside of the United States. Our
business is operated primarily from our offices in the Bahamas
and Spain. In addition, our general partner is a Marshall
Islands limited liability company and all but four of its
directors and officers are non-residents of the United States,
and all or a substantial portion of the assets of these
non-residents are located outside the United States. As a
result, it may be difficult or impossible for you to bring an
action against us or against these individuals in the United
States if you believe that your rights have been infringed under
securities laws or otherwise. Even if you are successful in
bringing an action of this kind, the laws of the Marshall
Islands and of other jurisdictions may prevent or restrict you
from enforcing a judgment against our assets or the assets of
our general partner or its directors and officers.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='111'></A>
</DIV>

<!-- link1 "Risks Relating to the Common Units" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Risks Relating to the Common Units</B>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Common unitholders may experience immediate and
    substantial dilution of their interest.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In the past, purchasers of our common units have experienced
immediate and substantial dilution of their ownership interest
in us. This dilution results primarily because the assets
contributed by our general partner and its affiliates are
recorded at their historical cost, and not their fair value, in
accordance with GAAP. Depending on whether the offering price
for any common units exceeds the pro forma net tangible book
value per common unit, you could incur immediate and substantial
dilution.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We may issue additional common units without the approval
    of the common unitholders, which would dilute their ownership
    interests.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our general partner, without the approval of our unitholders,
may cause us to issue an unlimited number of additional units or
other equity securities of equal or senior rank. The issuance by
us of additional common units or other equity securities will
have the following effects:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our unitholders&#146; proportionate ownership interest in us
    will decrease;</TD>
</TR>

<TR>
    <TD style="font-size: 3.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the amount of cash available for distribution on each unit may
    decrease;</TD>
</TR>

<TR>
    <TD style="font-size: 3.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    because a lower percentage of total outstanding units will be
    subordinated units, the risk that a shortfall in the payment of
    the minimum quarterly distribution will be borne by our common
    unitholders will increase;</TD>
</TR>

<TR>
    <TD style="font-size: 3.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the relative voting strength of each previously outstanding unit
    may be diminished;</TD>
</TR>

<TR>
    <TD style="font-size: 3.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the market price of the common units may decline;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 3.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the ratio of taxable income to distributions may increase.</TD>
</TR>

</TABLE>

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<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>In establishing cash reserves, our general partner may
    reduce the amount of cash available for distribution to the
    common unitholders.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our partnership agreement requires our general partner to deduct
from operating surplus cash reserves that it determines are
necessary to fund our future operating expenditures. These
reserves affect the amount of cash available for distribution to
our common unitholders. Our general partner may establish
reserves for distributions on the subordinated units, but only
if those reserves will not prevent us from distributing the full
minimum quarterly distribution, plus any arrearages, on the
common units for the following four quarters. The partnership
agreement requires our general partner each quarter to deduct
from operating surplus estimated maintenance capital
expenditures, as opposed to actual expenditures, which could
reduce the amount of available cash for distribution to the
common unitholders.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Our general partner has a call right that may require
    common unitholders to sell their common units at an undesirable
    time or price.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If at any time our general partner and its affiliates own more
than 80% of the common units, our general partner will have the
right, but not the obligation (which it may assign to any of its
affiliates or to us), to acquire all, but not less than all, of
the common units held by unaffiliated persons at a price not
less than their then-current market price. As a result, common
unitholders may be required to sell their common units at an
undesirable time or price and may not receive any return on
their investment. Common unitholders may also incur a tax
liability upon a sale of their units.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Teekay Shipping Corporation currently owns 43.2% of our common
units. At the end of the subordination period (assuming no
additional issuances of common units and conversion of our
subordinated units into common units), Teekay Shipping
Corporation will own 67.1% of the common units. Teekay Shipping
Corporation will also acquire additional common units if it
elects to receive common units in satisfaction of obligations
owed to it by us, such as in connection with the sale to us of
its 70% interest in Teekay Nakilat Corporation, which through
its subsidiaries will lease under capital leases the three
RasGas&nbsp;II LNG newbuilding carriers. Accordingly, after
subordinated units are converted to common units our general
partner and its affiliates may own a sufficient percentage of
our common units to enable our general partner to exercise its
call right.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Our partnership agreement restricts the voting rights of
    unitholders owning 20% or more of our common units.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our partnership agreement restricts unitholders&#146; voting
rights by providing that any units held by a person that owns
20% or more of any class of units then outstanding, other than
our general partner, its affiliates, their transferees and
persons who acquired such units with the prior approval of the
board of directors of our general partner, cannot vote on any
matter. The partnership agreement also contains provisions
limiting the ability of unitholders to call meetings or to
acquire information about our operations, as well as other
provisions limiting the unitholders&#146; ability to influence
the manner or direction of management.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Common unitholders may not have limited liability if a
    court finds that unitholder action constitutes control of our
    business.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As a limited partner in a partnership organized under the laws
of the Marshall Islands, common unitholders could be held liable
for our obligations to the same extent as a general partner if
they participate in the &#147;control&#148; of our business. Our
general partner generally has unlimited liability for the
obligations of the partnership, such as its debts and
environmental liabilities, except for those contractual
obligations of the partnership that are expressly made without
recourse to our general partner. In addition, the Marshall
Islands Act provides that, under some circumstances, a
unitholder may be liable to us for the amount of a distribution
for a period of three years from the date of the distribution.
In addition, the limitations on the liability of holders of
limited partner interests for the obligations of a limited
partnership have not been clearly established in some
jurisdictions in which we do business.
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='112'></A>
</DIV>

<!-- link1 "Risks Relating to the Debt Securities" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Risks Relating to the Debt Securities</B>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We may not be able to generate sufficient cash flow to
    meet our debt service obligations.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our ability to make payments on and to refinance our
indebtedness and to fund planned expenditures will depend on our
ability to generate cash. This, to a certain extent, is subject
to general economic, financial, competitive, legislative,
regulatory and other factors that are beyond our control.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We may not be able to generate sufficient cash flow from
operations or borrow amounts under our revolving credit
facilities sufficient to fund our liquidity needs. We may need
to refinance all or a portion of our indebtedness on or before
maturity, which we may be unable to do on commercially
reasonable terms, if at all.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We are a holding company. We conduct our operations
    through our subsidiaries, who own our operating assets, and
    depend on cash flow from our subsidiaries to service our debt
    obligations.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are a holding company. We conduct our operations through our
subsidiaries. As a result, our cash flow and ability to service
our debt depends on the earnings of our subsidiaries and their
distribution of earnings, loans or other payments to us. Any
payment of dividends, distributions, loans or other payments
from our subsidiaries to us could be subject to statutory or
contractual restrictions. If we are unable to obtain funds from
our subsidiaries we may not be able to pay interest or principal
on our debt securities when due or to obtain the necessary funds
from other sources.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Our substantial debt levels may limit our flexibility in
    obtaining additional financing and in pursuing other business
    opportunities.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of June&nbsp;30, 2006, our consolidated debt, capital lease
obligations and debt related to newbuilding vessels to be
acquired totaled $1.4&nbsp;billion. In addition, we have the
capacity to borrow significant additional amounts under our
credit facilities. These facilities may be used by us for
general partnership purposes. If we are awarded contracts for
new LNG projects, our consolidated debt and capital lease
obligations will increase, perhaps significantly. We will
continue to have the ability to incur additional debt, subject
to limitations in our credit facilities. Our level of debt could
have important consequences to us, including the following:
</DIV>

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    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our ability to satisfy our obligations under our debt securities
    or other indebtedness may be impaired, and our failure to comply
    with the requirements of the other indebtedness could result in
    an event of default under our debt securities or such other
    indebtedness;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our ability to obtain additional financing, if necessary, for
    working capital, capital expenditures, acquisitions or other
    purposes may be impaired or such financing may not be available
    on favorable terms;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    we will need a substantial portion of our cash flow to make
    principal and interest payments on our debt, reducing the funds
    that would otherwise be available for operations, future
    business opportunities and distributions to unitholders;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our debt level will make us more vulnerable than our competitors
    with less debt to competitive pressures or a downturn in our
    business or the economy generally;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our debt level may limit our flexibility in responding to
    changing business and economic conditions.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
Our ability to service our debt will depend upon, among other
things, our future financial and operating performance, which
will be affected by prevailing economic conditions and
financial, business, regulatory and other factors, many of which
are beyond our control. If our operating results are not
sufficient to service our current or future indebtedness, we
will be forced to take actions such as reducing distributions,
reducing or delaying our business activities, acquisitions,
investments or capital expenditures, selling assets,
restructuring or refinancing our debt, or seeking additional
equity capital or bankruptcy protection. We may be unable to
effect any of these remedies on satisfactory terms, or at all.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">26

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<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>In the event of our bankruptcy or liquidation, holders of
    our debt securities will be paid from any assets remaining after
    payments to any holders of secured debt and debt of our
    non-guarantor subsidiaries.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We anticipate that any debt securities we may offer pursuant to
this prospectus will be our general unsecured obligations, and
that any guarantees of our debt securities will be the general
unsecured obligations of the applicable Subsidiary Guarantors,
and effectively subordinated to any secured debt that we or they
may have, to the extent of the value of the assets securing that
debt. In the event any of our subsidiaries do not guarantee our
debt securities, those debt securities will be effectively
subordinated to the liabilities of any of those non-guarantor
subsidiaries.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If we are declared bankrupt or insolvent, or are liquidated, the
holders of our secured debt will be entitled to be paid from our
assets before any payment may be made with respect to our
unsecured debt securities. If any of these events occurs, we may
not have sufficient assets to pay amounts due on our secured
debt and our debt securities.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>The subsidiary guarantees could be deemed to be fraudulent
    conveyances under certain circumstances, and a court may try to
    subordinate or void the subsidiary guarantees.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our debt securities may be guaranteed by certain of our
subsidiaries. Under U.S.&nbsp;federal bankruptcy laws and
comparable provisions of state fraudulent transfer laws, a
guarantee by a subsidiary could be voided, or claims in respect
of a guarantee could be subordinated to all other debts of that
guarantor if, among other things, the guarantor, at the time it
incurred the indebtedness evidenced by its guarantee received
less than reasonably equivalent fair value or fair consideration
for the incurrence of such guarantee,&nbsp;and
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    was insolvent or rendered insolvent by reason of such incurrence;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    was engaged in a business or transaction for which the
    guarantor&#146;s remaining assets constituted unreasonably small
    capital;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    intended to incur, or believed that it would incur, debts beyond
    its ability to pay such debts as they mature.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, any payment by that subsidiary guarantor pursuant
to its guarantee could be voided and required to be returned to
the guarantor, or to a fund for the benefit of the creditors of
the guarantor. The measures of insolvency for purposes of these
fraudulent transfer laws will vary depending upon the law
applied in any proceeding to determine whether a fraudulent
transfer has occurred. Generally, however, a guarantor would be
considered insolvent if:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the sum of its liabilities, including contingent liabilities,
    were greater than the fair saleable value of all of its assets;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the present fair saleable value of its assets were less than the
    amount that would be required to pay its liabilities, including
    contingent liabilities, on its existing debts, as they become
    absolute or mature;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    it could not pay its debts as they become due.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='113'></A>
</DIV>

<!-- link1 "Tax Risks" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Tax Risks</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition to the following risk factors, you should read
&#147;Material U.S.&nbsp;Federal Income Tax Consequences&#148;
for a more complete discussion of expected material
U.S.&nbsp;federal income tax consequences of owning and
disposing of our securities.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>You may be required to pay U.S.&nbsp;taxes on your share
    of our income even if you do not receive any cash distributions
    from us.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Assuming that you are a U.S.&nbsp;citizen, resident or other
U.S.&nbsp;taxpayer, you will be required to pay
U.S.&nbsp;federal income taxes and, in some cases,
U.S.&nbsp;state and local income taxes on your share of our
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
taxable income, whether or not you receive cash distributions
from us. You may not receive cash distributions from us equal to
your share of our taxable income or even equal to the actual tax
liability that results from your share of our taxable income.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Because distributions may reduce a common
    unitholder&#146;s tax basis in our common units, common
    unitholders may realize greater gain on the disposition of their
    units than they otherwise may expect, and common unitholders may
    have a tax gain even if the price they receive is less than
    their original cost.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If common unitholders sell their common units, they will
recognize gain or loss for U.S.&nbsp;federal income tax purposes
that is equal to the difference between the amount realized and
their tax basis in those common units. Prior distributions in
excess of the total net taxable income allocated decrease a
common unitholder&#146;s tax basis and will, in effect, become
taxable income if common units are sold at a price greater than
their tax basis, even if the price received is less than the
original cost. Assuming we are not treated as a corporation for
U.S.&nbsp;federal income tax purposes, a substantial portion of
the amount realized on a sale of units, whether or not
representing gain, may be ordinary income.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>The after-tax benefit of an investment in the common units
    may be reduced if we cease to be treated as a partnership for
    U.S.&nbsp;federal income tax purposes.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The anticipated after-tax benefit of an investment in the common
units may be reduced if we cease to be treated as a partnership
for U.S.&nbsp;federal income tax purposes.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If we cease to be treated as a partnership for U.S.&nbsp;federal
income tax purposes, we would be treated as becoming a
corporation for such purposes, and common unitholders could
suffer material adverse tax or economic consequences, including
the following:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    The ratio of taxable income to distributions with respect to
    common units would increase because items would not be allocated
    to account for any differences between the fair market value and
    the basis of our assets at the time of the offering.</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Common unitholders may recognize income or gain on any change in
    our status from a partnership to a corporation that occurs while
    they hold units.</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    We would not be permitted to adjust the tax basis of a secondary
    market purchaser in our assets under Section&nbsp;743(b) of the
    U.S.&nbsp;Internal Revenue Code of 1986. As a result, a person
    who purchases common units from a common unitholder in the
    market may realize materially more taxable income each year with
    respect to the units if we are treated as a corporation than if
    we are treated as a partnership for U.S.&nbsp;federal income tax
    purposes. This could reduce the value of the common
    unitholder&#146;s common units.</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Common unitholders would not be entitled to claim any credit
    against their U.S.&nbsp;federal income tax liability for
    <FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>income
    tax liabilities incurred by us if we are treated as a
    corporation for U.S.&nbsp;federal income tax purposes.</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    If we fail to qualify for an exemption from U.S.&nbsp;tax on the
    U.S.&nbsp;source portion of our income attributable to
    transportation that begins or ends (but not both) in the United
    States, we will be subject to U.S.&nbsp;tax on such income on a
    gross basis (that is, without any allowance for deductions) at a
    rate of 4%. The imposition of this tax would have a negative
    effect on our business and would result in decreased cash
    available for distribution to common unitholders.</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    We also may be considered a passive foreign investment company
    (or <I>PFIC</I>) for U.S.&nbsp;federal income tax purposes.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">28

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>U.S.&nbsp;tax-exempt entities and
    <FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>persons
    face unique U.S.&nbsp;tax issues from owning common units that
    may result in adverse U.S.&nbsp;tax consequences to them.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Investments in common units by U.S.&nbsp;tax-exempt entities,
including individual retirement accounts (known as <I>IRAs</I>),
other retirements plans and
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>persons
raise issues unique to them. Assuming we are classified as a
partnership for U.S.&nbsp;federal income tax purposes, virtually
all of our income allocated to organizations exempt from
U.S.&nbsp;federal income tax will be unrelated business taxable
income and generally will be subject to U.S.&nbsp;federal income
tax. In addition,
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>persons
may be subject to a 4% U.S.&nbsp;federal income tax on the
U.S.&nbsp;source portion of our gross income attributable to
transportation that begins or ends in the United States, or
distributions to them may be reduced on account of withholding
of U.S.&nbsp;federal income tax by us in the event we are
treated as having a fixed place of business in the United States
or otherwise earn U.S.&nbsp;effectively connected income, unless
an exemption applies and they file U.S.&nbsp;federal income tax
returns to claim such exemption.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>The sale or exchange of 50% or more of our capital or
    profits interests in any
    <FONT style="white-space: nowrap">12-month</FONT> period will
    result in the termination of our partnership for
    U.S.&nbsp;federal income tax purposes.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We will be considered to have been terminated for
U.S.&nbsp;federal income tax purposes if there is a sale or
exchange of 50% or more of the total interests in our capital or
profits within any
<FONT style="white-space: nowrap">12-month</FONT> period. Our
termination would, among other things, result in the closing of
our taxable year for all unitholders and could result in a
deferral of depreciation deductions allowable in computing our
taxable income. Please read &#147;Material U.S.&nbsp;Federal
Income Tax Consequences&nbsp;&#151; Disposition of Common
Units&nbsp;&#151; Constructive Termination.&#148;
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Common unitholders may be subject to income tax in one or
    more <FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>
    countries, including Canada, as a result of owning our common
    units if, under the laws of any such country, we are considered
    to be carrying on business there. Such laws may require common
    unitholders to file a tax return with, and pay taxes to, those
    countries. Any foreign taxes imposed on us or any of our
    subsidiaries will reduce our cash available for distribution to
    common unitholders.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We intend that our affairs and the business of each of our
subsidiaries is conducted and operated in a manner that
minimizes foreign income taxes imposed upon us and our
subsidiaries or which may be imposed upon you as a result of
owning our common units. However, there is a risk that common
unitholders will be subject to tax in one or more countries,
including Canada, as a result of owning our common units if,
under the laws of any such country, we are considered to be
carrying on business there. If common unitholders are subject to
tax in any such country, common unitholders may be required to
file a tax return with, and pay taxes to, that country based on
their allocable share of our income. We may be required to
reduce distributions to common unitholders on account of any
withholding obligations imposed upon us by that country in
respect of such allocation to common unitholders. The United
States may not allow a tax credit for any foreign income taxes
that common unitholders directly or indirectly incur. Any
foreign taxes imposed on us or any of our subsidiaries will
reduce our cash available for common unitholders.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">29

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='114'></A>
</DIV>

<!-- link1 "USE OF PROCEEDS" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>USE OF PROCEEDS</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Unless we specify otherwise in any prospectus supplement, we
will use the net proceeds from our sale of securities covered by
this prospectus for general partnership purposes, which may
include, among other things:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    paying or refinancing all or a portion of our indebtedness
    outstanding at the time;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    funding working capital, capital expenditures or acquisitions.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The actual application of proceeds from the sale of any
particular offering of securities covered by this prospectus
will be described in the applicable prospectus supplement
relating to the offering.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='115'></A>
</DIV>

<!-- link1 "RATIO OF EARNINGS TO FIXED CHARGES" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>RATIO OF EARNINGS TO FIXED CHARGES</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table presents our consolidated ratio of earnings
to fixed charges for each of the periods indicated:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 8.0pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="24%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>


<TR style="font-size: 7.0pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="14" align="center" nowrap><B>Years Ended December&nbsp;31,</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="14" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>


<TR style="font-size: 7.0pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="6" align="center" nowrap><B>2004</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="6" align="center" nowrap><B>2005</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>Six Months</B></TD><TD></TD>
</TR>

<TR style="font-size: 7.0pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="6" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="6" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>Ended</B></TD><TD></TD>
</TR>

<TR style="font-size: 7.0pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="10" align="center" nowrap><B>Years Ended</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
</TR>

<TR style="font-size: 7.0pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="10" align="center" nowrap><B>December&nbsp;31,</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>January&nbsp;1 to</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>May 1 to</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>January&nbsp;1 to</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>May 10 to</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 7.0pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="10" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>April 30,</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>December&nbsp;31,</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>May 9,</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>December&nbsp;31,</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>June&nbsp;30,</B></TD><TD></TD>
</TR>

<TR style="font-size: 7.0pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>2001</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>2002</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>2003</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>2004</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>2004</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>2005</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>2005</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>2006</B></TD><TD></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Ratio of earnings to fixed charges(1)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1.28</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(3.87</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(0.44</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1.54</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(0.62</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1.74</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2.12</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0.60</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deficiency of earnings to fixed charges (in millions of
    U.S.&nbsp;Dollars)(2)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>117.6</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>70.4</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>86.0</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>16.2</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 3.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    The information in this table is for our predecessor, Teekay
    Luxembourg S.a.r.l. and its subsidiaries, which include Teekay
    Shipping Spain, S.L., for periods subsequent to April&nbsp;30,
    2004 and prior to May&nbsp;10, 2005, the date of our initial
    public offering. For periods prior to April&nbsp;30, 2004, the
    information presented is for Teekay Shipping Spain, S.L.</TD>
</TR>

<TR>
    <TD style="font-size: 3.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(2)&nbsp;</TD>
    <TD align="left">
    Earnings were insufficient to cover fixed charges for the years
    ended December&nbsp;31, 2002 and 2003, the period of May&nbsp;1
    to December&nbsp;31, 2004 and the six months ended June&nbsp;30,
    2006 by the amounts indicated in the table.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For purposes of calculating the ratio of earnings to fixed
charges:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="2%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;</TD>
    <TD align="left">
    <I>&#147;earnings&#148;</I> is the amount resulting from adding
    the following items:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;</TD>
    <TD align="left">
    pre-tax income (loss) from continuing operations before
    adjustment for minority interests in consolidated subsidiaries;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;</TD>
    <TD align="left">
    fixed charges; and</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;</TD>
    <TD align="left">
    amortization of capitalized interest; and</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
subtracting the following items:
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;</TD>
    <TD align="left">
    capitalized interest; and</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;</TD>
    <TD align="left">
    the minority interest in pre-tax income of subsidiaries that
    have not incurred fixed charges.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="2%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;</TD>
    <TD align="left">
    <I>&#147;fixed charges&#148;</I> represents interest expensed,
    capitalized interest, write-off of capitalized loan costs and
    amortization of capitalized expenses related to indebtedness.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">30

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='177'></A>
</DIV>

<!-- link1 "PRICE RANGE OF COMMON UNITS AND DISTRIBUTIONS" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>PRICE RANGE OF COMMON UNITS AND DISTRIBUTIONS</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of September&nbsp;1, 2006, there were 20,238,072 common units
outstanding, held by approximately 20&nbsp;holders of record.
Our common units were first offered on the New York Stock
Exchange on May&nbsp;5, 2005, at an initial price of
$22.00&nbsp;per unit. Our common units are traded on the New
York Stock Exchange under the symbol &#147;TGP.&#148;
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table sets forth, for the periods indicated, the
high and low sales prices for our common units, as reported on
the New York Stock Exchange, and quarterly cash distributions
declared per common unit. The last reported sale price of common
units on the New York Stock Exchange on September&nbsp;28, 2006
was $29.95 per common unit.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10.0pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="63%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="11%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>


<TR style="font-size: 8.0pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="6" align="center" nowrap><B>Price Range</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>Cash</B></TD><TD></TD>
</TR>

<TR style="font-size: 8.0pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="6" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>Distributions</B></TD><TD></TD>
</TR>

<TR style="font-size: 8.0pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>High</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>Low</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>per Unit(1)</B></TD><TD></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>2006</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Year Ending December&nbsp;31, 2006 (through September&nbsp;28)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>31.98</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>28.65</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>0.925&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>2005</B>(2)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Year Ended December&nbsp;31, 2005</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>34.70</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>24.30</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>1.0607</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>2006</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Quarter Ending September&nbsp;30 (through September&nbsp;28)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>31.47</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>29.35</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Quarter Ended June&nbsp;30</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>31.98</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>29.13</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>0.4625</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Quarter Ended March&nbsp;31</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>31.69</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>28.65</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0.4625</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>2005</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Quarter Ended December&nbsp;31</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>32.25</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>27.40</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>0.4125</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Quarter Ended September&nbsp;30</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>34.70</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>28.12</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0.4125</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Quarter Ended June&nbsp;30(2)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>28.45</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>24.30</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0.2357</TD>
    <TD align="left" valign="bottom" nowrap>(3)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>2006</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Month Ending September&nbsp;30 (through September&nbsp;28)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>30.40</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>29.35</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Month Ended August&nbsp;31</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30.40</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>29.35</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Month Ended July&nbsp;31</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>31.47</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30.28</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Month Ended June&nbsp;30</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>31.13</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30.07</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Month Ended May&nbsp;31</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>31.00</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>29.13</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Month Ended April&nbsp;30</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>31.98</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30.45</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 3.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    Represents cash distributions attributable to the quarter and
    paid within 45&nbsp;days after the quarter.</TD>
</TR>

<TR>
    <TD style="font-size: 3.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(2)&nbsp;</TD>
    <TD align="left">
    Period beginning May&nbsp;5, 2005.</TD>
</TR>

<TR>
    <TD style="font-size: 3.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(3)&nbsp;</TD>
    <TD align="left">
    The distribution reflects the
    <FONT style="white-space: nowrap">52-day</FONT> period from
    May&nbsp;10, 2005 to June&nbsp;30, 2005.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">31
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='116'></A>
</DIV>

<!-- link1 "DESCRIPTION OF THE COMMON UNITS" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>DESCRIPTION OF THE COMMON UNITS</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our common units and our subordinated units represent limited
partner interests in us. The holders of units are entitled to
participate in partnership distributions and exercise the rights
and privileges available to limited partners under our
partnership agreement. For a description of the relative rights
and privileges of holders of common units, holders of
subordinated units and our general partner in and to partnership
distributions, together with a description of the circumstances
under which subordinated units convert into common units, please
read &#147;Cash Distributions.&#148;
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='117'></A>
</DIV>

<!-- link1 "Number of Units" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Number of Units</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We currently have 20,238,072 common units outstanding, of which
11,503,500 are held by the public and 8,734,572 are held by
Teekay Shipping Corporation, which owns our general partner. We
also have 14,734,572 subordinated units outstanding, for which
there is no established public trading market, all of which are
held by Teekay Shipping Corporation. The common units and the
subordinated units represent an aggregate 98% limited partner
interest and the general partner interest represents a 2%
general partner interest in us.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='118'></A>
</DIV>

<!-- link1 "Issuance of Additional Securities" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Issuance of Additional Securities</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our partnership agreement authorizes us to issue an unlimited
number of additional partnership securities and rights to buy
partnership securities for the consideration and on the terms
and conditions determined by our general partner without the
approval of our unitholders.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We may fund acquisitions through the issuance of additional
common units or other equity securities. Holders of any
additional common units we issue will be entitled to share
equally with the then-existing holders of common units in our
distributions of available cash. In addition, the issuance of
additional common units or other equity securities interests may
dilute the value of the interests of the then-existing holders
of common units in our net assets.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In accordance with Marshall Islands law and the provisions of
our partnership agreement, we may also issue additional
partnership securities interests that, as determined by the
general partner, have special voting or other rights to which
the common units are not entitled.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Upon issuance of additional partnership securities, our general
partner will be required to make additional capital
contributions to the extent necessary to maintain its 2% general
partner interest in us. In addition, our general partner and its
affiliates have the right, which it may from time to time assign
in whole or in part to any of its affiliates, to purchase common
units, subordinated units or other equity securities whenever,
and on the same terms that, we issue those securities to persons
other than our general partner and its affiliates, to the extent
necessary to maintain its and its affiliates&#146; percentage
interest, including its interest represented by common units and
subordinated units, that existed immediately prior to each
issuance. Other holders of common units do not have similar
preemptive rights to acquire additional common units or other
partnership securities.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='119'></A>
</DIV>

<!-- link1 "Meetings; Voting" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Meetings; Voting</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Unlike the holders of common stock in a corporation, the holders
of our units have only limited voting rights on matters
affecting our business. They have no right to elect our general
partner (who manages our operations and activities) or the
directors of our general partner on an annual or other
continuing basis. On those matters that are submitted to a vote
of unitholders, each record holder of a unit may vote according
to the holder&#146;s percentage interest in us, although
additional limited partner interests having special voting
rights could be issued. However, if at any time any person or
group, other than our general partner and its affiliates (or a
direct or subsequently approved transferee of our general
partner or its affiliates or a transferee approved by the board
of directors of our general partner) acquires, in the aggregate,
beneficial ownership of 20% or more of any class of units then
outstanding, that person or group will lose voting rights on all
of its units and the units may not be voted on any matter and
will not be
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">32

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
considered to be outstanding when sending notices of a meeting
of unitholders, calculating required votes, determining the
presence of a quorum, or for other similar purposes.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Holders of our subordinated units sometimes vote as a single
class together with the holders of our common units and
sometimes vote as a class separate from the holders of common
units. Holders of subordinated units, like holders of common
units, have very limited voting rights. During the subordination
period, common units (excluding common units held by our general
partner and its affiliates) and subordinated units each vote
separately as a class generally on the following matters:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    a merger of our partnership;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    a sale or exchange of all or substantially all of our assets;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the election of a successor general partner in connection with
    certain withdrawals of our general partner;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    dissolution or reconstitution of our partnership;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    some amendments to our partnership agreement;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    some amendments to the operating agreement of our operating
    company or action taken by us as a member of the operating
    company if such amendment or action would materially and
    adversely affect our limited partners.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Neither the subordinated units nor any common units held by our
general partners or any of its affiliates are entitled to vote
on approval of the withdrawal of our general partner or the
transfer by our general partner of its general partner interest
or incentive distribution rights under some circumstances.
Removal of our general partner requires:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    a
    <FONT style="white-space: nowrap">66-</FONT><FONT style="font-size: 70%"><SUP>2</SUP></FONT>/<FONT style="font-size: 60%">3</FONT>%
    vote of all outstanding units, voting as a single class;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the election of a successor general partner by the holders of a
    majority of the outstanding common units and subordinated units,
    voting as separate classes.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Except as described above regarding a person or group owning 20%
or more of any class of units then outstanding, unitholders or
assignees who are record holders of units on the record date
will be entitled to notice of, and to vote at, any meetings of
our limited partners and to act upon matters for which approvals
may be solicited. Common units that are owned by an assignee who
is a record holder, but who has not yet been admitted as a
limited partner, will be voted by the general partner at the
written direction of the record holder. Absent direction of this
kind, the common units will not be voted, except that, in the
case of common units held by our general partner on behalf of
unpermitted citizen assignees, our general partner will
distribute the votes on those common units in the same ratios as
the votes of limited partners with respect to other units are
cast.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Any action that is required or permitted to be taken by the
unitholders may be taken either at a meeting of the unitholders
or without a meeting if consents in writing describing the
action so taken are signed by holders of the number of units
necessary to authorize or take that action at a meeting.
Meetings of the unitholders may be called by our general partner
or by unitholders owning at least 20% of the outstanding units
of the class for which a meeting is proposed. Unitholders may
vote either in person or by proxy at meetings. The holders of a
majority of the outstanding units of the class or classes for
which a meeting has been called, represented in person or by
proxy, will constitute a quorum unless any action by the
unitholders requires approval by holders of a greater percentage
of the units, in which case the quorum will be the greater
percentage.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Common units held in nominee or street name account will be
voted by the broker or other nominee in accordance with the
instruction of the beneficial owner unless the arrangement
between the beneficial owner and his nominee provides otherwise.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">33

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='120'></A>
</DIV>

<!-- link1 "Call Right" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Call Right</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If at any time our general partner and its affiliates hold more
than 80% of the then-issued and outstanding partnership
securities of any class, our general partner will have the
right, which it may assign in whole or in part to any of its
affiliates or to us, to acquire all, but not less than all, of
the remaining partnership securities of the class held by
unaffiliated persons as of a record date to be selected by our
general partner, on at least 10 but not more than
60&nbsp;days&#146; notice. The purchase price in this event is
the greater of: (1)&nbsp;the highest cash price paid by either
the general partner or any of its affiliates for any partnership
securities of the class purchased within the 90&nbsp;days
preceding the date on which our general partner first mails
notice of its election to purchase those partnership securities;
and (2)&nbsp;the current market price as of the date three days
before the date the notice is mailed.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As a result of our general partner&#146;s right to purchase
outstanding partnership securities, a holder of partnership
securities may have the holder&#146;s partnership securities
purchased at an undesirable time or price. The tax consequences
to a unitholder of the exercise of this call right are the same
as a sale by that unitholder of common units in the market.
Please read &#147;Material U.S.&nbsp;Federal Income Tax
Consequences&nbsp;&#151; Disposition of Common Units.&#148;
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='121'></A>
</DIV>

<!-- link1 "Exchange Listing" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Exchange Listing</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our common units are listed on the New York Stock Exchange,
where they trade under the symbol &#147;TGP.&#148;
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='122'></A>
</DIV>

<!-- link1 "Transfer Agent and Registrar" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Transfer Agent and Registrar</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Bank of New York serves as registrar and transfer agent for
our common units. We pay all fees charged by the transfer agent
for transfers of common units, except the following, which must
be paid by unitholders:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    surety bond premiums to replace lost or stolen certificates,
    taxes and other governmental charges;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    special charges for services requested by a holder of a common
    unit;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    other similar fees or charges.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
There is no charge to unitholders for disbursements of our cash
distributions. We will indemnify the transfer agent, its agents
and each of their stockholders, directors, officers and
employees against all claims and losses that may arise out of
acts performed or omitted for its activities in that capacity,
except for any liability due to any gross negligence or
intentional misconduct of the indemnified person or entity.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='123'></A>
</DIV>

<!-- link1 "Transfer of Common Units" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Transfer of Common Units</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Transfers of a common unit will not be recorded by the transfer
agent or recognized by us unless the transferee executes and
delivers a transfer application. By executing and delivering a
transfer application, the transferee of common units:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    becomes the record holder of the common units and is an assignee
    until admitted into our partnership as a substituted limited
    partner;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    automatically requests admission as a substituted limited
    partner in our partnership;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    agrees to be bound by the terms and conditions of, and executes,
    our partnership agreement;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    represents that the transferee has the capacity, power and
    authority to enter into our partnership agreement;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    grants powers of attorney to officers of our general partner and
    any liquidator of us as specified in our partnership
    agreement;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    gives the consents and approvals contained in our partnership
    agreement.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">34

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
An assignee will become a substituted limited partner of our
partnership for the transferred common units automatically upon
the recording of the transfer on our books and records. Our
general partner will cause any unrecorded transfers for which a
completed and duly executed transfer application has been
received to be recorded on our books and records no less
frequently than quarterly.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A transferee&#146;s broker, agent or nominee may complete,
execute and deliver a transfer application. We are entitled to
treat the nominee holder of a common unit as the absolute owner.
In that case, the beneficial holder&#146;s rights are limited
solely to those that it has against the nominee holder as a
result of any agreement between the beneficial owner and the
nominee holder.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Common units are securities and are transferable according to
the laws governing transfer of securities. In addition to other
rights acquired upon transfer, the transferor gives the
transferee the right to request admission as a substituted
limited partner in our partnership for the transferred common
units. A purchaser or transferee of common units who does not
execute and deliver a transfer application obtains only:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the right to assign the common unit to a purchaser or other
    transferee;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the right to transfer the right to seek admission as a
    substituted limited partner in our partnership for the
    transferred common units.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Thus, a purchaser or transferee of common units who does not
execute and deliver a transfer application:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    will not receive cash distributions or U.S.&nbsp;federal income
    tax allocations, unless the common units are held in a nominee
    or &#147;street name&#148; account and the nominee or broker has
    executed and delivered a transfer application;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    may not receive some U.S.&nbsp;federal income tax information or
    reports furnished to record holders of common units.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The transferor of common units has a duty to provide the
transferee with all information that may be necessary to
transfer the common units. The transferor does not have a duty
to ensure the execution of the transfer application by the
transferee and has no liability or responsibility if the
transferee neglects or chooses not to execute and forward the
transfer application to the transfer agent.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Until a common unit has been transferred on our books, we and
the transfer agent may treat the record holder of the unit as
the absolute owner for all purposes, except as otherwise
required by law or stock exchange regulations.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='178'></A>
</DIV>

<!-- link1 "Other Matters" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Other Matters</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Merger, Sale, or Other Disposition of Assets.</I></B> A
merger or consolidation of us requires the consent of our
general partner, in addition to the unitholder vote described
above under &#147;&#151;&nbsp;Meetings; Voting.&#148; However,
our general partner will have no duty or obligation to consent
to any merger or consolidation and may decline to do so free of
any fiduciary duty or obligation whatsoever to us or the limited
partners, including any duty to act in good faith or in the best
interests of us or the limited partners. In addition, although
our partnership agreement generally requires the unitholder vote
described above &#147;&#151;&nbsp;Meetings; Voting&#148; for the
sale, exchange or other disposition of all or substantially all
of our assets in a single transaction or a series of related
transactions, our general partner may mortgage, pledge,
hypothecate or grant a security interest in all or substantially
all of our assets without that approval. Our general partner may
also sell all or substantially all of our assets under a
foreclosure or other realization upon those encumbrances without
that approval. The unitholders are not entitled to
dissenters&#146; rights of appraisal under our partnership
agreement or applicable law in the event of a conversion, merger
or consolidation, a sale of all or substantially all of our
assets, or any other transaction or event.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Registration Rights.</I></B> Under our partnership
agreement, we have agreed to register for resale under the
U.S.&nbsp;Securities Act of 1933 and applicable state securities
laws any common units, subordinated units
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
or other partnership securities proposed to be sold by our
general partner or any of its affiliates or their assignees if
an exemption from the registration requirements is not otherwise
available or advisable. These registration rights continue for
two years following any withdrawal or removal of Teekay GP
L.L.C. as our general partner. We are obligated to pay all
expenses incidental to the registration, excluding underwriting
discounts and commissions.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='124'></A>
</DIV>

<!-- link1 "Summary of Our Partnership Agreement" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Summary of Our Partnership Agreement</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A copy of our partnership agreement is filed as an exhibit to
the registration statement of which this prospectus is a part. A
summary of the important provisions of our partnership agreement
and the rights and privileges of our unitholders is included in
our registration statement on
Form&nbsp;<FONT style="white-space: nowrap">8-A/</FONT> A as
filed with the SEC on September&nbsp;29, 2006, including any
subsequent amendments or reports filed for the purpose of
updating such description. Please read &#147;Where You Can Find
More Information.&#148;
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='125'></A>
</DIV>

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<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>CASH DISTRIBUTIONS</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='126'></A>
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Distributions of Available Cash</B>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>General</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our partnership agreement provides that within approximately
45&nbsp;days after the end of each quarter we will distribute
all of our available cash to unitholders of record on the
applicable record date.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Definition of Available Cash</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Available cash generally means, for each fiscal quarter, all
cash on hand at the end of the quarter (including our
proportionate share of cash on hand of certain subsidiaries we
do not wholly own):
</DIV>

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    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    less the amount of cash reserves (including our proportionate
    share of cash reserves of certain subsidiaries we do not wholly
    own) established by our general partner to:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="5%"></TD>
    <TD width="1%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    provide for the proper conduct of our business (including
    reserves for future capital expenditures and for our anticipated
    credit needs);</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    comply with applicable law, any of our debt instruments, or
    other agreements;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    provide funds for distributions to our unitholders and to our
    general partner for any one or more of the next four quarters;</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    plus all cash on hand (including our proportionate share of cash
    on hand of certain subsidiaries we do not wholly own) on the
    date of determination of available cash for the quarter
    resulting from working capital borrowings made after the end of
    the quarter. Working capital borrowings are generally borrowings
    that are made under our credit agreement and in all cases are
    used solely for working capital purposes or to pay distributions
    to partners.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Minimum Quarterly Distribution</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Common unitholders are entitled under our partnership agreement
to receive a quarterly distribution of $0.4125&nbsp;per unit, or
$1.65&nbsp;per year, prior to any distribution on our
subordinated units to the extent we have sufficient cash from
our operations after establishment of cash reserves and payment
of fees and expenses, including payments to our general partner.
Our general partner has the authority to determine the amount of
our available cash for any quarter. This determination, as well
as all determinations made by the general partner, must be made
in good faith. Our general partner&#146;s board of directors
declared an increase in our quarterly distribution to
$0.4625&nbsp;per unit, or $1.85&nbsp;per year, commencing with
the first quarter of 2006. There is no guarantee that we will
pay the quarterly distribution in this amount or the minimum
quarterly distribution on the common units in any quarter, and
we will be prohibited from making any distributions to
unitholders if it would cause an event of default, or an event
of default is existing, under our credit facilities.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='127'></A>
</DIV>

<!-- link1 "Operating Surplus and Capital Surplus" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Operating Surplus and Capital Surplus</B>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>General</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
All cash distributed to unitholders is characterized as either
&#147;operating surplus&#148; or &#147;capital surplus.&#148; We
treat distributions of available cash from operating surplus
differently than distributions of available cash from capital
surplus.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Definition of Operating Surplus</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Operating surplus for any period generally means:
</DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our cash balance (including our proportionate share of cash
    balances of certain subsidiaries we do not wholly own) on the
    closing date of our initial public offering, other than cash
    reserved to terminate interest rate swap agreements; plus</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">37

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<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    $10&nbsp;million (as described below); plus</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    all of our cash receipts (including our proportionate share of
    cash receipts of certain subsidiaries we do not wholly own)
    after the closing of our initial public offering, excluding cash
    from (1)&nbsp;borrowings, other than working capital borrowings,
    (2)&nbsp;sales of equity and debt securities, (3)&nbsp;sales or
    other dispositions of assets outside the ordinary course of
    business, (4)&nbsp;termination of interest rate swap agreements,
    (5) capital contributions or (6)&nbsp;corporate reorganizations
    or restructurings; plus</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    working capital borrowings (including our proportionate share of
    working capital borrowings by certain subsidiaries we do not
    wholly own) made after the end of a quarter but before the date
    of determination of operating surplus for the quarter; plus</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    interest paid on debt incurred (including periodic net payments
    under related interest rate swap agreements) and cash
    distributions paid on equity securities issued, in each case, to
    finance all or any portion of the construction, replacement or
    improvement of a capital asset such as vessels during the period
    from such financing until the earlier to occur of the date the
    capital asset is put into service or the date that it is
    abandoned or disposed of; plus</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    interest paid on debt incurred (including periodic net payments
    under related interest rate swap agreements) and cash
    distributions paid on equity securities issued, in each case, to
    pay the construction period interest on debt incurred, or to pay
    construction period distributions on equity issued, to finance
    the construction projects described in the immediately preceding
    bullet; less</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    all of our cash operating expenditures (including our
    proportionate share of cash operating expenditures of certain
    subsidiaries we do not wholly own) after the closing of our
    initial public offering and the repayment of working capital
    borrowings, but not (1)&nbsp;the repayment of other borrowings,
    (2)&nbsp;actual maintenance capital expenditures or expansion
    capital expenditures, (3)&nbsp;transaction expenses (including
    taxes) related to interim capital transactions or
    (4)&nbsp;distributions; less</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    estimated maintenance capital expenditures and the amount of
    cash reserves (including our proportionate share of cash
    reserves of certain subsidiaries we do not wholly own)
    established by our general partner to provide funds for future
    operating expenditures.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As described above, operating surplus does not only reflect
actual cash on hand that is available for distribution to our
unitholders. For example, it also includes a provision that
enables us, if we choose, to distribute as operating surplus up
to $10&nbsp;million of cash we may receive from non-operating
sources, such as asset sales, issuances of securities and
long-term borrowings, that would otherwise be distributed as
capital surplus. In addition, the effect of including, as
described above, certain cash distributions on equity securities
or interest payments on debt in operating surplus is to increase
operating surplus by the amount of any such cash distributions
or interest payments. As a result, we may also distribute as
operating surplus up to the amount of any such cash
distributions or interest payments of cash we receive from
non-operating sources.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Capital Expenditures</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For purposes of determining operating surplus, maintenance
capital expenditures are those capital expenditures required to
maintain over the long term the operating capacity of or the
revenue generated by our capital assets, and expansion capital
expenditures are those capital expenditures that increase the
operating capacity of or the revenue generated by our capital
assets. To the extent, however, that capital expenditures
associated with acquiring a new vessel increase the revenues or
the operating capacity of our fleet, those capital expenditures
are classified as expansion capital expenditures.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Examples of maintenance capital expenditures include capital
expenditures associated with dry-docking a vessel or acquiring a
new vessel to the extent such expenditures are incurred to
maintain the operating capacity of or the revenue generated by
our fleet. Maintenance capital expenditures also include
</DIV>

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interest (and related fees) on debt incurred and distributions
on equity issued to finance the construction of a replacement
vessel and paid during the construction period, which we define
as the period beginning on the date that we enter into a binding
construction contract and ending on the earlier of the date that
the replacement vessel commences commercial service or the date
that the replacement vessel is abandoned or disposed of. Debt
incurred to pay or equity issued to fund construction period
interest payments, and distributions on such equity, also are
considered maintenance capital expenditures.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Because our maintenance capital expenditures can be very large
and vary significantly in timing, the amount of our actual
maintenance capital expenditures may differ substantially from
period to period, which could cause similar fluctuations in the
amounts of operating surplus, adjusted operating surplus, and
available cash for distribution to our unitholders if we
subtracted actual maintenance capital expenditures from
operating surplus each quarter. Accordingly, to eliminate the
effect on operating surplus of these fluctuations, our
partnership agreement requires that an amount equal to an
estimate of the average quarterly maintenance capital
expenditures necessary to maintain the operating capacity of or
the revenue generated by our capital assets over the long term
be subtracted from operating surplus each quarter, as opposed to
the actual amounts spent. The amount of estimated maintenance
capital expenditures deducted from operating surplus is subject
to review and change by the board of directors of our general
partner at least once a year, provided that any change must be
approved by our conflicts committee. The estimate is made at
least annually and whenever an event occurs that is likely to
result in a material adjustment to the amount of our maintenance
capital expenditures, such as a major acquisition or the
introduction of new governmental regulations that affects our
fleet. For purposes of calculating operating surplus, any
adjustment to this estimate is prospective only.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The use of estimated maintenance capital expenditures in
calculating operating surplus has the following effects:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    it reduces the risk that actual maintenance capital expenditures
    in any one quarter will be large enough to make operating
    surplus less than the minimum quarterly distribution to be paid
    on all the units for that quarter and subsequent quarters;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    it reduces the need for us to borrow under our working capital
    facility to pay distributions;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    it is more difficult for us to raise our distribution on our
    units above the minimum quarterly distribution and pay incentive
    distributions to our general partner;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    it reduces the likelihood that a large maintenance capital
    expenditure in a period will prevent the general partner&#146;s
    affiliates from being able to convert some or all of their
    subordinated units into common units since the effect of an
    estimate is to spread the expected expense over several periods,
    mitigating the effect of the actual payment of the expenditure
    on any single period.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Definition of Capital Surplus</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Capital surplus generally is generated only by:
</DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    borrowings other than working capital borrowings;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    sales of debt and equity securities;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    sales or other dispositions of assets for cash, other than
    inventory, accounts receivable and other current assets sold in
    the ordinary course of business or non-current assets sold as
    part of normal retirements or replacements of assets.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Characterization of Cash Distributions</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We treat all available cash distributed as coming from operating
surplus until the sum of all available cash distributed since we
began operations equals the operating surplus as of the most
recent date of determination of available cash. We treat any
amount distributed in excess of operating surplus, regardless
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
of its source, as capital surplus. We do not anticipate that we
will make any distributions from capital surplus.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='128'></A>
</DIV>

<!-- link1 "Subordination Period" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Subordination Period</B>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>General</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During the subordination period, which we define below, the
common units will have the right to receive distributions of
available cash from operating surplus in an amount equal to the
minimum quarterly distribution of $0.4125&nbsp;per quarter, plus
any arrearages in the payment of the minimum quarterly
distribution on the common units from prior quarters, before any
distributions of available cash from operating surplus may be
made on the subordinated units. The purpose of the subordinated
units is to increase the likelihood that during the
subordination period there will be available cash to be
distributed on the common units.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Definition of Subordination Period</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The subordination period generally will extend until the first
day of any quarter, beginning after March&nbsp;31, 2010, that
each of the following tests are met:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    distributions of available cash from operating surplus on each
    of the outstanding common units and subordinated units equaled
    or exceeded the minimum quarterly distribution for each of the
    three consecutive, non-overlapping four-quarter periods
    immediately preceding that date;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the &#147;adjusted operating surplus&#148; (as defined below)
    generated during each of the three consecutive, non-overlapping
    four-quarter periods immediately preceding that date equaled or
    exceeded the sum of the minimum quarterly distributions on all
    of the outstanding common units and subordinated units during
    those periods on a fully diluted basis and the related
    distribution on the 2% general partner interest during those
    periods;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    there are no arrearages in payment of the minimum quarterly
    distribution on the common units.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If the unitholders remove our general partner without cause, the
subordination period may end before March&nbsp;31, 2010.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Early Conversion of Subordinated Units</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Before the end of the subordination period, 50% of the
subordinated units, or up to 7,367,286 subordinated units, may
convert into common units on a one-for-one basis immediately
after the distribution of available cash to the partners in
respect of any quarter ending on or after:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    March&nbsp;31, 2008 with respect to 25% of the subordinated
    units outstanding immediately after our initial public
    offering;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    March&nbsp;31, 2009 with respect to a further 25% of the
    subordinated units outstanding immediately after our initial
    public offering.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The early conversions will occur if at the end of the applicable
quarter each of the following occurs:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    distributions of available cash from operating surplus on each
    of the outstanding common units and subordinated units equaled
    or exceeded the minimum quarterly distribution for each of the
    three consecutive, non-overlapping four-quarter periods
    immediately preceding that date;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the adjusted operating surplus generated during each of the
    three consecutive, non-overlapping four-quarter periods
    immediately preceding that date equaled or exceeded the sum of
    the minimum quarterly distributions on all of the outstanding
    common units and subordinated units during those periods on a
    fully diluted basis and the related distribution on the 2%
    general partner interest during those periods;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    there are no arrearages in payment of the minimum quarterly
    distribution on the common units.</TD>
</TR>

</TABLE>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
However, the second early conversion of the subordinated units
may not occur until at least one year following the first early
conversion of the subordinated units.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For purposes of determining whether sufficient adjusted
operating surplus has been generated under these conversion
tests, the conflicts committee of our general partner&#146;s
board of directors may adjust adjusted operating surplus upwards
or downwards if it determines in good faith that the estimated
amount of maintenance capital expenditures used in the
determination of operating surplus was materially incorrect,
based on circumstances prevailing at the time of original
determination of the estimate.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Definition of Adjusted Operating Surplus</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Adjusted operating surplus for any period generally means:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    operating surplus generated with respect to that period; less</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    any net increase in working capital borrowings with respect to
    that period; less</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    any net reduction in cash reserves for operating expenditures
    with respect to that period not relating to an operating
    expenditure made with respect to that period; plus</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    any net decrease in working capital borrowings with respect to
    that period; plus</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    any net increase in cash reserves for operating expenditures
    with respect to that period required by any debt instrument for
    the repayment of principal, interest or premium.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Adjusted operating surplus is intended to reflect the cash
generated from operations during a particular period and
therefore excludes net increases in working capital borrowings
and net drawdowns of reserves of cash generated in prior periods.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Effect of Expiration of the Subordination Period</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Upon expiration of the subordination period, each outstanding
subordinated unit will convert into one common unit and will
then participate pro rata with the other common units in
distributions of available cash. In addition, if the unitholders
remove our general partner other than for cause and units held
by our general partner and its affiliates are not voted in favor
of such removal:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the subordination period will end and each subordinated unit
    will immediately convert into one common unit;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    any existing arrearages in payment of the minimum quarterly
    distribution on the common units will be extinguished;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our general partner will have the right to convert its general
    partner interest and, if any, its incentive distribution rights
    into common units or to receive cash in exchange for those
    interests.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='129'></A>
</DIV>

<!-- link1 "Distributions of Available Cash From Operating Surplus During the Subordination Period" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Distributions of Available Cash From Operating Surplus During
the Subordination Period</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We make distributions of available cash from operating surplus
for any quarter during the subordination period in the following
manner:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    first, 98% to the common unitholders, pro rata, and 2% to our
    general partner, until we distribute for each outstanding common
    unit an amount equal to the minimum quarterly distribution for
    that quarter;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    second, 98% to the common unitholders, pro rata, and 2% to our
    general partner, until we distribute for each outstanding common
    unit an amount equal to any arrearages in payment of the minimum
    quarterly distribution on the common units for any prior
    quarters during the subordination period;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">41

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<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    third, 98% to the subordinated unitholders, pro rata, and 2% to
    our general partner, until we distribute for each subordinated
    unit an amount equal to the minimum quarterly distribution for
    that quarter;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    thereafter, in the manner described in &#147;Incentive
    Distribution Rights&#148; below.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='130'></A>
</DIV>

<!-- link1 "Distributions of Available Cash From Operating Surplus After the Subordination Period" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Distributions of Available Cash From Operating Surplus After
the Subordination Period</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We will make distributions of available cash from operating
surplus for any quarter after the subordination period in the
following manner:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    first, 98% to all unitholders, pro rata, and 2% to our general
    partner, until we distribute for each outstanding unit an amount
    equal to the minimum quarterly distribution for that
    quarter;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    thereafter, in the manner described in &#147;Incentive
    Distribution Rights&#148; below.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='131'></A>
</DIV>

<!-- link1 "Incentive Distribution Rights" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Incentive Distribution Rights</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Incentive distribution rights represent the right to receive an
increasing percentage of quarterly distributions of available
cash from operating surplus after the minimum quarterly
distribution and the target distribution levels have been
achieved. Our general partner currently holds the incentive
distribution rights, but may transfer these rights separately
from its general partner interest, subject to restrictions in
the partnership agreement.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If for any quarter:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    we have distributed available cash from operating surplus to the
    common and subordinated unitholders in an amount equal to the
    minimum quarterly distribution;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    we have distributed available cash from operating surplus on
    outstanding common units in an amount necessary to eliminate any
    cumulative arrearages in payment of the minimum quarterly
    distribution;</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
then, we will distribute any additional available cash from
operating surplus for that quarter among the unitholders and our
general partner in the following manner:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    first, 98% to all unitholders, pro rata, and 2% to our general
    partner, until each unitholder receives a total of
    $0.4625&nbsp;per unit for that quarter (the &#147;first target
    distribution&#148;);</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    second, 85% to all unitholders, pro rata, and 15% to our general
    partner, until each unitholder receives a total of
    $0.5375&nbsp;per unit for that quarter (the &#147;second target
    distribution&#148;);</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    third, 75% to all unitholders, pro rata, and 25% to our general
    partner, until each unitholder receives a total of
    $0.6500&nbsp;per unit for that quarter (the &#147;third target
    distribution&#148;);&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    thereafter, 50% to all unitholders, pro rata, and 50% to our
    general partner.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In each case, the amount of the target distribution set forth
above is exclusive of any distributions to common unitholders to
eliminate any cumulative arrearages in payment of the minimum
quarterly distribution. The percentage interests set forth above
for our general partner include its 2% general partner interest
and assume the general partner has not transferred the incentive
distribution rights.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='132'></A>
</DIV>

<!-- link1 "Percentage Allocations of Available Cash From Operating Surplus" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Percentage Allocations of Available Cash From Operating
Surplus</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table illustrates the percentage allocations of
the additional available cash from operating surplus among the
unitholders and our general partner up to the various target
distribution levels. The amounts set forth under &#147;Marginal
Percentage Interest in Distributions&#148; are the percentage
interests of the unitholders and our general partner in any
available cash from operating surplus we distribute up to and
including the corresponding amount in the column &#147;Total
Quarterly Distribution Target Amount,&#148; until available cash
from operating surplus we distribute reaches the next target
distribution level, if any.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">42

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
The percentage interests shown for the unitholders and our
general partner for the minimum quarterly distribution are also
applicable to quarterly distribution amounts that are less than
the minimum quarterly distribution. The percentage interests
shown for our general partner include its 2% general partner
interest and assume the general partner has not transferred the
incentive distribution rights.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10.0pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="39%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>


<TR style="font-size: 8.0pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="6" align="center" nowrap><B>Marginal Percentage Interest in</B></TD><TD></TD>
</TR>

<TR style="font-size: 8.0pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="6" align="center" nowrap><B>Distributions</B></TD><TD></TD>
</TR>

<TR style="font-size: 8.0pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap><B>Total Quarterly Distribution Target</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="6" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
</TR>

<TR style="font-size: 8.0pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap><B>Amount</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>Unitholders</B></TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap><B>General Partner</B></TD><TD></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD><TD></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Minimum Quarterly Distribution</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom">
    $0.4125</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>98</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    First Target Distribution</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom">
    up to $0.4625</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>98</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Second Target Distribution</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom">
    above $0.4625 up to $0.5375</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>85</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Third Target Distribution</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom">
    above $0.5375 up to $0.6500</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>75</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>25</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Thereafter</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom">
    above $0.6500</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>50</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>50</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='133'></A>
</DIV>

<!-- link1 "Distributions From Capital Surplus" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Distributions From Capital Surplus</B>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>How Distributions From Capital Surplus Will Be Made</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We will make distributions of available cash from capital
surplus, if any, in the following manner:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    first, 98% to all unitholders, pro rata, and 2% to our general
    partner, until we distribute for each common unit that was
    issued in this offering, an amount of available cash from
    capital surplus equal to the initial public offering price;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    second, 98% to the common unitholders, pro rata, and 2% to our
    general partner, until we distribute for each common unit, an
    amount of available cash from capital surplus equal to any
    unpaid arrearages in payment of the minimum quarterly
    distribution on the common units;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    thereafter, we will make all distributions of available cash
    from capital surplus as if they were from operating surplus.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Effect of a Distribution From Capital Surplus</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The partnership agreement treats a distribution of capital
surplus as the repayment of the initial unit price from our
initial public offering on May&nbsp;10, 2005, which is a return
of capital. That initial public offering price less any
distributions of capital surplus per unit is referred to as the
&#147;unrecovered initial unit price.&#148; Each time a
distribution of capital surplus is made, the minimum quarterly
distribution and the target distribution levels will be reduced
in the same proportion as the corresponding reduction in the
unrecovered initial unit price. Because distributions of capital
surplus will reduce the minimum quarterly distribution, after
any of these distributions are made, it may be easier for our
general partner to receive incentive distributions and for the
subordinated units to convert into common units. However, any
distribution of capital surplus before the unrecovered initial
unit price is reduced to zero cannot be applied to the payment
of the minimum quarterly distribution or any arrearages.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Once we distribute capital surplus on a unit issued in our
initial public offering in an amount equal to the initial public
offering price for our initial public offering, we will reduce
the minimum quarterly distribution and the target distribution
levels to zero. We will then make all future distributions from
operating surplus, with 50% being paid to the holders of units
and 50% to our general partner. The percentage interests shown
for our general partner include its 2% general partner interest
and assume the general partner has not transferred the incentive
distribution rights.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">43
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='134'></A>
</DIV>

<!-- link1 "Adjustment to the Minimum Quarterly Distribution and Target Distribution Levels" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Adjustment to the Minimum Quarterly Distribution and Target
Distribution Levels</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition to adjusting the minimum quarterly distribution and
target distribution levels to reflect a distribution of capital
surplus, if we combine our units into fewer units or subdivide
our units into a greater number of units, we will
proportionately adjust:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the minimum quarterly distribution;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the target distribution levels;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the unrecovered initial unit price;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the number of common units issuable during the subordination
    period without a unitholder vote.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For example, if a two-for-one split of the common units should
occur, the minimum quarterly distribution, the target
distribution levels and the unrecovered initial unit price would
each be reduced to 50% of its initial level and the number of
common units issuable during the subordination period without a
unitholder vote would double. We will not make any adjustment by
reason of the issuance of additional units for cash or property.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, if legislation is enacted or if existing law is
modified or interpreted by a governmental taxing authority so
that we become taxable as a corporation or otherwise subject to
taxation as an entity for U.S.&nbsp;federal, state, local or
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>income
tax purposes, we will reduce the minimum quarterly distribution
and the target distribution levels for each quarter by
multiplying each distribution level by a fraction, the numerator
of which is available cash for that quarter and the denominator
of which is the sum of available cash for that quarter plus the
general partner&#146;s estimate of our aggregate liability for
the quarter for such income taxes payable by reason of such
legislation or interpretation. To the extent that the actual tax
liability differs from the estimated tax liability for any
quarter, the difference will be accounted for in subsequent
quarters.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='135'></A>
</DIV>

<!-- link1 "Distributions of Cash Upon Liquidation" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Distributions of Cash Upon Liquidation</B>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>General</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If we dissolve in accordance with the partnership agreement, we
will sell or otherwise dispose of our assets in a process called
liquidation. We will first apply the proceeds of liquidation to
the payment of our creditors. We will distribute any remaining
proceeds to the unitholders and our general partner, in
accordance with their capital account balances, as adjusted to
reflect any gain or loss upon the sale or other disposition of
our assets in liquidation.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The allocations of gain and loss upon liquidation are intended,
to the extent possible, to entitle the holders of outstanding
common units to a preference over the holders of outstanding
subordinated units upon our liquidation, to the extent required
to permit common unitholders to receive their unrecovered
initial unit price plus the minimum quarterly distribution for
the quarter during which liquidation occurs plus any unpaid
arrearages in payment of the minimum quarterly distribution on
the common units. However, there may not be sufficient gain upon
our liquidation to enable the holders of common units to fully
recover all of these amounts, even though there may be cash
available for distribution to the holders of subordinated units.
Any further net gain recognized upon liquidation will be
allocated in a manner that takes into account the incentive
distribution rights of our general partner.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Manner of Adjustments for Gain</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The manner of the adjustment for gain is set forth in the
partnership agreement. If our liquidation occurs before the end
of the subordination period, we will allocate any gain to the
partners in the following manner:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    first, to our general partner and the holders of units who have
    negative balances in their capital accounts to the extent of and
    in proportion to those negative balances;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">44

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    second, 98% to the common unitholders, pro rata, and 2% to our
    general partner, until the capital account for each common unit
    is equal to the sum of:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    (1)&nbsp;the unrecovered initial unit price;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    (2)&nbsp;the amount of the minimum quarterly distribution for
    the quarter during which our liquidation occurs;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    (3)&nbsp;any unpaid arrearages in payment of the minimum
    quarterly distribution;</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    third, 98% to the subordinated unitholders, pro rata, and 2% to
    our general partner until the capital account for each
    subordinated unit is equal to the sum of:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    (1)&nbsp;the unrecovered initial unit price;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    (2)&nbsp;the amount of the minimum quarterly distribution for
    the quarter during which our liquidation occurs;</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    fourth, 98% to all unitholders, pro rata, and 2% to our general
    partner, until we allocate under this paragraph an amount per
    unit equal to:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    (1)&nbsp;the sum of the excess of the first target distribution
    per unit over the minimum quarterly distribution per unit for
    each quarter of our existence; less</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    (2)&nbsp;the cumulative amount per unit of any distributions of
    available cash from operating surplus in excess of the minimum
    quarterly distribution per unit that we distributed 98% to the
    unitholders, pro rata, and 2% to our general partner, for each
    quarter of our existence;</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    fifth, 85% to all unitholders, pro rata, and 15% to our general
    partner, until we allocate under this paragraph an amount per
    unit equal to:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    (1)&nbsp;the sum of the excess of the second target distribution
    per unit over the first target distribution per unit for each
    quarter of our existence; less</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    (2)&nbsp;the cumulative amount per unit of any distributions of
    available cash from operating surplus in excess of the first
    target distribution per unit that we distributed 85% to the
    unitholders, pro rata, and 15% to our general partner for each
    quarter of our existence;</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    sixth, 75% to all unitholders, pro rata, and 25% to our general
    partner, until we allocate under this paragraph an amount per
    unit equal to:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    (1)&nbsp;the sum of the excess of the third target distribution
    per unit over the second target distribution per unit for each
    quarter of our existence; less</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    (2)&nbsp;the cumulative amount per unit of any distributions of
    available cash from operating surplus in excess of the second
    target distribution per unit that we distributed 75% to the
    unitholders, pro rata, and 25% to our general partner for each
    quarter of our existence;&nbsp;and</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    thereafter, 50% to all unitholders, pro rata, and 50% to our
    general partner.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
The percentage interests set forth above for our general partner
include its 2% general partner interest and assume the general
partner has not transferred the incentive distribution rights.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If the liquidation occurs after the end of the subordination
period, the distinction between common units and subordinated
units will disappear, so that clause&nbsp;(3) of the second
bullet point above and all of the third bullet point above will
no longer be applicable.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">45

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Manner of Adjustments for Losses</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If our liquidation occurs before the end of the subordination
period, we will generally allocate any loss to our general
partner and the unitholders in the following manner:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    first, 98% to holders of subordinated units in proportion to the
    positive balances in their capital accounts and 2% to our
    general partner, until the capital accounts of the subordinated
    unitholders have been reduced to zero;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    second, 98% to the holders of common units in proportion to the
    positive balances in their capital accounts and 2% to our
    general partner, until the capital accounts of the common
    unitholders have been reduced to zero;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    thereafter, 100% to our general partner.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If the liquidation occurs after the end of the subordination
period, the distinction between common units and subordinated
units will disappear, so that the first bullet point above will
no longer be applicable.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Adjustments to Capital Accounts</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We will make adjustments to capital accounts upon the issuance
of additional units. In doing so, we will allocate any
unrealized and, for tax purposes, unrecognized gain or loss
resulting from the adjustments to the existing unitholders and
our general partner in the same manner as we allocate gain or
loss upon liquidation. In the event that we make positive
adjustments to the capital accounts upon the issuance of
additional units, we will allocate any later negative
adjustments to the capital accounts resulting from the issuance
of additional units or upon our liquidation in a manner which
results, to the extent possible, in our general partner&#146;s
and unitholders&#146; capital account balances equaling the
amount which they would have been if no earlier positive
adjustments to the capital accounts had been made.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">46

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='136'></A>
</DIV>

<!-- link1 "DESCRIPTION OF DEBT SECURITIES" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>DESCRIPTION OF DEBT SECURITIES</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='137'></A>
</DIV>

<!-- link1 "General" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>General</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The debt securities we may offer and sell pursuant to this
prospectus will be:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our direct general obligations;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    either senior debt securities or subordinated debt
    securities;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    issued under an indenture between us and the Trustee thereunder.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Teekay LNG Partners L.P. may issue debt securities in one or
more series, and Teekay LNG Finance Corp. may be the co-issuer
of one or more series of debt securities. Teekay LNG Finance
Corp. was incorporated under the laws of the Republic of the
Marshall Islands in August 2006 and is wholly owned by Teekay
LNG Partners L.P. Its activities will be limited to co-issuing
debt securities and engaging in other related activities. When
used in this section &#147;Description of Debt Securities,&#148;
the terms &#147;we,&#148; &#147;us,&#148; &#147;our&#148; and
&#147;issuers&#148; refer jointly to Teekay LNG Partners L.P.
and Teekay LNG Finance Corp., and the terms &#147;Teekay LNG
Partners L.P.&#148; and &#147;Teekay LNG Finance Corp.&#148;
refer strictly to Teekay LNG Partners L.P. and Teekay LNG
Finance Corp., respectively.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If we offer senior debt securities, we will issue them under a
senior indenture. If we issue subordinated debt securities, we
will issue them under a subordinated indenture. A form of each
indenture is filed as an exhibit to the registration statement
of which this prospectus is a part. Please read &#147;Where You
Can Find More Information&#148; for information on how to obtain
copies of the indentures. We have not restated either indenture
in its entirety in this description. You should read the
relevant indenture because it, and not this description,
controls the rights of holders of the debt securities.
Capitalized terms used in this summary have the meanings
specified in the respective indentures.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='138'></A>
</DIV>

<!-- link1 "Specific Terms of Each Series of Debt Securities to be Described in the Prospectus Supplement" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Specific Terms of Each Series of Debt Securities to be
Described in the Prospectus Supplement</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A prospectus supplement and a supplemental indenture or
authorizing resolutions of our general partner&#146;s board of
directors relating to any series of debt securities that we may
offer will include specific terms relating to the offering.
These terms will include some or all of the following:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    whether Teekay LNG Finance Corp. will be a co-issuer of the debt
    securities;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the Subsidiary Guarantors, if any, of the debt securities;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    whether the debt securities are senior or subordinated debt
    securities;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the title of the debt securities;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the total principal amount of the debt securities;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the assets, if any, that are pledged as security for the payment
    of the debt securities;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    whether we will issue the debt securities in individual
    certificates to each holder in registered form, or in the form
    of temporary or permanent global securities held by a depository
    on behalf of the holders;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the prices at which we will issue the debt securities;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the portion of the principal amount of the debt securities that
    will be payable if the maturity of the debt securities is
    accelerated;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the currency or currency unit in which the debt securities will
    be payable, if not U.S.&nbsp;Dollars;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the dates on which the principal of the debt securities will be
    payable;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the interest rate that the debt securities will bear and the
    interest payment dates for the debt securities;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">47

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    whether the debt securities are convertible into or exchangeable
    for other securities, and the conversion or exchange rate and
    other related terms, conditions and features;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    any optional redemption provisions;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    any sinking fund or other provisions that would obligate us to
    repurchase or otherwise redeem the debt securities;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    any changes or additions to events of default or covenants
    described in this prospectus;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    any other terms of the debt securities.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
This description of debt securities will be deemed modified,
amended or supplemented by any description of any series of debt
securities set forth in a prospectus supplement related to that
series.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For purposes of this prospectus, any reference to the payment of
principal of, or any premium or interest on, debt securities
will include additional amounts if required by the terms of the
debt securities.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We may issue debt securities with terms different from those of
debt securities that may already have been issued. Without the
consent of the holders thereof, we may reopen a previous issue
of a series of debt securities and issue additional debt
securities of that series unless the reopening was restricted
when that series was created.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We may offer and sell debt securities, including original issue
discount debt securities, at a substantial discount below their
principal amount. The prospectus supplement will describe
special U.S.&nbsp;federal income tax and other considerations
applicable to those securities. In addition, the prospectus
supplement may describe certain special U.S.&nbsp;federal income
tax or other considerations applicable to any debt securities
that are denominated in a currency other than U.S.&nbsp;Dollars.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='139'></A>
</DIV>

<!-- link1 "Subsidiary Guarantees" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Subsidiary Guarantees</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If specified in the prospectus supplement for a series of debt
securities, the subsidiaries of Teekay LNG Partners L.P.
specified in the prospectus supplement will unconditionally
guarantee, on a joint and several basis, the full and prompt
payment of principal of, premium, if any, and interest on the
debt securities of that series when and as the same become due
and payable, whether at maturity, upon redemption or repurchase,
by declaration of acceleration or otherwise. The prospectus
supplement will describe any limitation on the maximum amount of
any particular guarantee.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The guarantees will be general obligations of the Subsidiary
Guarantors. Guarantees of subordinated debt securities of Teekay
LNG Partners L.P. will be subordinated to the Senior
Indebtedness of the Subsidiary Guarantors on the same basis as
the subordinated debt securities are subordinated to the Senior
Indebtedness of Teekay LNG Partners L.P. Please read
&#147;&#151;&nbsp;Provisions Relating Only to the Subordinated
Debt Securities&#148; below.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Releases</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The guarantee of any Subsidiary Guarantor may be released under
certain circumstances. If we exercise our legal or covenant
defeasance option with respect to debt securities of a
particular series as described below in
&#147;&#151;&nbsp;Defeasance,&#148; each Subsidiary Guarantor
will be released with respect to that series. In addition, if no
default has occurred and is continuing under the applicable
indenture, and to the extent not otherwise prohibited by the
indenture, a Subsidiary Guarantor will be unconditionally
released and discharged from its guarantee:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    automatically upon any sale, exchange or transfer, whether by
    way of merger or otherwise, to any person that is not our
    affiliate, of all of our direct or indirect limited partnership
    or other equity interests in the Subsidiary Guarantor;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    automatically upon the merger of the Subsidiary Guarantor into
    us or any other Subsidiary Guarantor or the liquidation and
    dissolution of the Subsidiary Guarantor;&nbsp;or</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">48

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    following delivery of a written notice by us to the Trustee,
    upon the release or discharge of all guarantees by the
    Subsidiary Guarantor of any debt of ours for borrowed money or
    for a guarantee thereof (other than any series of debt
    securities under the indenture), except a discharge or release
    as a result of payment under such guarantees.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='140'></A>
</DIV>

<!-- link1 "Consolidation, Merger or Asset Sale" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Consolidation, Merger or Asset Sale</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Each indenture will, in general, allow us or any Subsidiary
Guarantor to consolidate or merge with or into another entity.
It will also allow us and each Subsidiary Guarantor to sell,
lease, transfer or otherwise dispose of all or substantially all
of our or its assets to another entity. If this happens, the
remaining or acquiring entity must assume all of our or the
Subsidiary Guarantor&#146;s responsibilities and liabilities
under the indenture, including the payment of all amounts due on
the debt securities and performance of our or the Subsidiary
Guarantor&#146;s covenants in the indenture.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
However, each indenture will impose certain requirements
relating to any such consolidation or merger with or into
another entity, or any sale, lease, transfer or other
disposition of all or substantially all of our assets, including:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the remaining or acquiring entity must be organized under the
    laws of the Republic of the Marshall Islands, the United States
    (or any state thereof) or other specified jurisdictions;
    provided that Teekay LNG Finance Corp. may not merge or
    consolidate with or into another entity other than a corporation
    satisfying such organizational requirement for so long as Teekay
    LNG Partners L.P. is not a corporation;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the remaining or acquiring entity must assume our or such
    Subsidiary Guarantor&#146;s obligations under the
    indenture;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    immediately after giving effect to the transaction, no Default
    or Event of Default (as defined below under
    &#147;&#151;&nbsp;Events of Default and Remedies&#148;) may
    exist.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The remaining or acquiring entity will be substituted for us or
the Subsidiary Guarantor in the indenture with the same effect
as if it had been an original party to the indenture, and we or
the Subsidiary Guarantor will be relieved from any further
obligations under the indenture.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='141'></A>
</DIV>

<!-- link1 "No Protection in the Event of a Change of Control" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>No Protection in the Event of a Change of Control</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Unless otherwise set forth in the prospectus supplement, the
debt securities will not contain any provisions that protect the
holders of the debt securities in the event of a change of
control of us or in the event of a highly leveraged transaction,
whether or not such transaction results in a change of control
of us.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='142'></A>
</DIV>

<!-- link1 "Modification of Indentures" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Modification of Indentures</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We may supplement or amend an indenture if the holders of a
majority in aggregate principal amount of the outstanding debt
securities of each series issued under the indenture and
affected by the supplement or amendment consent to it. In
addition, the holders of a majority in aggregate principal
amount of the outstanding debt securities of any series may
waive past defaults under the indenture and compliance by us
with our covenants with respect to the debt securities of that
series only. Those holders may not, however, waive any default
in any payment on any debt security of that series or compliance
with a provision that cannot be supplemented or amended without
the consent of each affected holder. Without the consent of each
outstanding debt security affected, no modification of the
indenture or waiver may:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    reduce the principal amount of debt securities whose holders
    must consent to an amendment, supplement or waiver;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    reduce the principal or change the fixed maturity of any debt
    security;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">49

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    reduce or waive any premium payable upon redemption of any debt
    security or alter or waive any other redemption provisions
    (except as may be permitted in the case of a particular series
    of debt securities);</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    reduce the rate, or change the time for payment, of interest on
    any debt security;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    waive a Default or an Event of Default in the payment of
    principal of or premium, if any, or interest on the debt
    securities (except a rescission of acceleration of the debt
    securities by the holders of at least a majority in aggregate
    principal amount of the debt securities and a waiver of the
    payment default that resulted from such acceleration);</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    except as otherwise permitted under the indenture, release any
    security that may have been granted with respect to the debt
    securities;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    make any debt security payable in a currency other than that
    stated in the debt securities;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    in the case of any subordinated debt security, make any change
    in the subordination provisions that adversely affects the
    rights of any holder under those provisions;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    make any change in the provisions of the indenture relating to
    waivers of past Defaults or the rights of holders of debt
    securities to receive payments of principal of or premium, if
    any, or interest on the debt securities;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    waive a redemption payment with respect to any debt security
    (except as may be permitted in the case of a particular series
    of debt securities);</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    except as otherwise permitted in the indenture, release any
    Subsidiary Guarantor from its obligations under its guarantee or
    the indenture or change any guarantee in any manner that would
    adversely affect the rights of holders;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    make any change in the preceding amendment, supplement and
    waiver provisions (except to increase any percentage set forth
    therein).</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We may supplement or amend an indenture without the consent of
any holders of the debt securities in certain circumstances,
including:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    to establish the form or terms of any series of debt securities;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    to cure any ambiguity, defect or inconsistency;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    to provide for uncertificated notes in addition to or in place
    of certified notes;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    to provide for the assumption of our or a Subsidiary
    Guarantor&#146;s obligations to holders of debt securities in
    the case of a merger or consolidation or a disposition of all or
    substantially all of our or a Subsidiary Guarantor&#146;s assets;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    in the case of any subordinated debt security, to make any
    change in the subordination provisions that limits or terminates
    the benefits applicable to any holder of Senior Indebtedness;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    to add or release Subsidiary Guarantors pursuant to the terms of
    the indenture;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    to make any changes that would provide any additional rights or
    benefits to the holders of debt securities or that do not, taken
    as a whole, adversely affect the rights under the indenture of
    any holder of such debt securities;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    to comply with requirements of the SEC in order to effect or
    maintain the qualification of the indenture under the Trust
    Indenture Act of 1939;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    to evidence or provide for the acceptance of appointment under
    the indenture of a successor Trustee or separate Trustee;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">50

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    to add any additional Events of Default;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    to secure the debt securities or any guarantees.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='143'></A>
</DIV>

<!-- link1 "Events of Default and Remedies" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Events of Default and Remedies</B>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Events of Default</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#147;Event of Default,&#148; when used in an indenture, will
mean any of the following with respect to the debt securities of
any series:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    failure to pay when due the principal of or any premium on any
    debt security of that series;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    failure to pay, within 30&nbsp;days of the due date, interest on
    any debt security of that series;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    failure to pay when due any sinking fund payment with respect to
    any debt securities of that series;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    failure on the part of us, or any Subsidiary Guarantor that is a
    &#147;significant subsidiary&#148; of us under SEC regulations,
    to comply with the covenant described above under
    &#147;Consolidation, Merger or Asset Sale&#148;;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    failure by us or any Subsidiary Guarantor that is a significant
    subsidiary to perform any other covenant in the indenture that
    continues for 60&nbsp;days after written notice is given to us;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    certain events of bankruptcy, insolvency or reorganization of us
    or any Subsidiary Guarantor that is a significant subsidiary of
    us; or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    with respect to any Subsidiary Guarantor that is a significant
    subsidiary of us:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="5%"></TD>
    <TD width="1%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    its guarantee ceases to be in full force and effect, except as
    otherwise provided in the indenture;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    its guarantee is declared null and void in a judicial
    proceeding;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the Subsidiary Guarantor denies or disaffirms its obligations
    under the indenture or its guarantee;&nbsp;or</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    any other Event of Default provided under the terms of the debt
    securities of that series.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
An Event of Default for a particular series of debt securities
will not necessarily constitute an Event of Default for any
other series of debt securities issued under an indenture. The
Trustee may withhold notice to the holders of debt securities of
any default (except in the payment of principal, premium, if
any, or interest or in the making of any sinking fund payment
with respect to the debt securities of such series) if it
considers such withholding of notice to be in the interests of
the holders.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Exercise of Remedies</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If an Event of Default for any series of debt securities occurs
and is continuing, the Trustee or the holders of at least 25% in
aggregate principal amount of the debt securities of the series
may declare the entire principal of, and accrued interest on,
all the debt securities of that series to be due and payable
immediately. If an Event of Default occurs because of certain
events in bankruptcy, insolvency or reorganization, the
principal amount of, and accrued interest on, all the debt
securities of that series will be automatically accelerated,
without any action by the Trustee or any holder. A declaration
of acceleration of maturity and its consequences may be
rescinded by the holders of a majority in the aggregate
principal amount of the debt securities of the affected series
if:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the rescission would not conflict with any judgment or decree
    already rendered;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    all existing Events of Default have been cured or waived except
    nonpayment of principal or interest that has become due solely
    because of the acceleration.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Trustee will be under no obligation, except as otherwise
provided in the indenture, to exercise any of the rights or
powers under the indenture at the request or direction of any of
the holders unless such
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">51

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
holders have offered to the Trustee reasonable indemnity or
security against any costs, liability or expense. No holder may
pursue any remedy with respect to the indenture or the debt
securities of any series, except to enforce the right to receive
payment of principal, premium, if any, and interest when due on
its debt securities, unless:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    such holder has previously given the Trustee notice that an
    Event of Default with respect to that series has occurred and is
    continuing;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    holders of at least 25% in principal amount of the outstanding
    debt securities of that series have requested that the Trustee
    pursue the remedy;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    such holders have offered the Trustee reasonable indemnity or
    security against any cost, liability or expense;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the Trustee has not complied with such request within
    60&nbsp;days after the receipt of the request and the offer of
    indemnity or security;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the holders of a majority in principal amount of the outstanding
    debt securities of that series have not given the Trustee a
    direction that, in the opinion of the Trustee, is inconsistent
    with such request within such
    <FONT style="white-space: nowrap">60-day</FONT> period.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The holders of a majority in principal amount of the outstanding
debt securities of a series have the right, subject to certain
restrictions, to direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee or of
exercising any right or power conferred on the Trustee with
respect to that series of debt securities. The Trustee, however,
may refuse to follow any direction that:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    conflicts with law;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the Trustee determines is unduly prejudicial to the rights of
    any other holder;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    would involve the Trustee in personal liability.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Notice of an Event of Default</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Within 30&nbsp;days after the occurrence of any Default (meaning
an event that is, or after the notice or passage of time or both
would be, an Event of Default) or Event of Default, we are
required to give an officers&#146; certificate to the Trustee
specifying the Default or Event of Default and what action we
are taking or propose to take to cure it. In addition, we are
required to deliver to the Trustee, within 120&nbsp;days after
the end of each fiscal year, an officers&#146; certificate
indicating whether any Default or Event of Default has occurred
during the previous year.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If a Default occurs and is continuing and is known to the
Trustee, the Trustee must mail to each holder a notice of the
Default within 90&nbsp;days after the Default occurs. Except in
the case of a Default in the payment of principal, premium, if
any, or interest on any debt securities, the Trustee may
withhold such notice, but only if and so long as the board of
directors, the executive committee or a committee of directors
or responsible officers of the Trustee in good faith determines
that withholding such notice is in the interests of the holders.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='145'></A>
</DIV>

<!-- link1 "Defeasance" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Defeasance</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
At any time we may terminate, with respect to debt securities of
a particular series, all our obligations under such series of
debt securities and the indenture, which we call a &#147;legal
defeasance.&#148; If we decide to make a legal defeasance,
however, it will not terminate certain specified obligations,
including, among others, our obligations relating to the
defeasance trust, to maintain a registrar for the debt
securities and to register the transfer and exchange of debt
securities.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If we exercise our legal defeasance option, any guarantee will
terminate with respect to that series of debt securities.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">52

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
At any time we may also effect a &#147;covenant
defeasance,&#148; which means we have elected to terminate our
obligations under certain provisions and restrictive covenants
applicable to a series of debt securities, including any
covenant that may be added specifically for such series and is
described in a prospectus supplement.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We may exercise our legal defeasance option notwithstanding our
prior exercise of our covenant defeasance option. If we exercise
our legal defeasance option, payment of the affected series of
debt securities may not be accelerated because of an Event of
Default with respect to that series. If we exercise our covenant
defeasance option, payment of the defeased series of debt
securities may not be accelerated because of an Event of Default
specified in the fourth, fifth, sixth (with respect only to a
Subsidiary Guarantor, if any) or seventh bullet points under
&#147;&#151;&nbsp;Events of Default and Remedies&nbsp;&#151;
Events of Default&#148; above or an Event of Default that is
added specifically for such series and described in a prospectus
supplement.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
To exercise either defeasance option, we must:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    irrevocably deposit with the Trustee as trust funds cash in
    U.S.&nbsp;Dollars, certain U.S.&nbsp;government obligations or a
    combination thereof, for the payment of principal, premium, if
    any, and interest on the series of debt securities to redemption
    or stated maturity, as applicable;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    comply with certain other conditions, including that no Default
    has occurred and is continuing after the deposit in trust, and
    any additional provisions set forth in the prospectus
    supplement;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    deliver to the Trustee an opinion of counsel to the effect that
    holders of the series of debt securities will not recognize
    income, gain or loss for U.S.&nbsp;federal income tax purposes
    as a result of such defeasance and will be subject to
    U.S.&nbsp;federal income tax on the same amount and in the same
    manner and at the same times as would have been the case if such
    deposit and defeasance had not occurred. In the case of legal
    defeasance only, such opinion of counsel must be based on a
    ruling of the U.S.&nbsp;Internal Revenue Service or a change in
    applicable U.S.&nbsp;federal income tax law.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, we may discharge all obligations of the issuers and
Subsidiary Guarantors under the indenture with respect to the
debt securities of a particular series, other than our
obligation to register the transfer of and exchange debt
securities of that series, provided that we:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(a)&nbsp;</TD>
    <TD align="left">
    either:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="6%"></TD>
    <TD width="4%"></TD>
    <TD width="90%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    deliver all outstanding debt securities of that series to the
    Trustee for cancellation; or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(2)&nbsp;</TD>
    <TD align="left">
    all debt securities of that series not so delivered for
    cancellation have either become due and payable or will become
    due and payable at their stated maturity within one year or are
    to be called for redemption within one year, and, in any case,
    we have irrevocably deposited with the Trustee in trust an
    amount of cash, certain U.S.&nbsp;government obligations or a
    combination thereof, in an amount sufficient to pay the entire
    indebtedness of the debt securities of that series, including
    for principal, premium, if any, an accrued interest to the date
    of such deposit (in the case of debt securities that have become
    due and payable) or to the stated maturity or applicable
    redemption date, as applicable (in the case of debt securities
    that have not become due and payable);</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(b)&nbsp;</TD>
    <TD align="left">
    have paid or ceased to be paid all other sums payable under the
    indenture; and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(c)&nbsp;</TD>
    <TD align="left">
    have delivered an officers&#146; certificate and an opinion of
    counsel to the Trustee stating that all conditions precedent to
    such satisfaction and discharge have been satisfied.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='146'></A>
</DIV>

<!-- link1 "No Limit on Amount of Debt Securities" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>No Limit on Amount of Debt Securities</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The indenture will not limit the amount of debt securities that
we may issue, unless we indicate otherwise in a prospectus
supplement. The indenture will allow us to issue debt securities
of any series up to the aggregate principal amount that we
authorize.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">53

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='147'></A>
</DIV>

<!-- link1 "Registration of Notes" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Registration of Notes</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We will issue debt securities of a series only in registered
form, without coupons, unless otherwise indicated in the
prospectus supplement.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='148'></A>
</DIV>

<!-- link1 "Minimum Denominations" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Minimum Denominations</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Unless the prospectus supplement states otherwise, the debt
securities will be issued only in principal amounts of $1,000
each or integral multiples of $1,000.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='149'></A>
</DIV>

<!-- link1 "No Personal Liability" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>No Personal Liability</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
None of the past, present or future partners, incorporators,
managers, members, directors, officers, employees, unitholders
or stockholders of us, the general partner of Teekay LNG
Partners L.P. or any Subsidiary Guarantor will have any
liability for the obligations of us or any Subsidiary Guarantors
under the indenture or the debt securities or for any claim
based on such obligations or their creation. Each holder of debt
securities by accepting a debt security waives and releases all
such liability. The waiver and release are part of the
consideration for the issuance of the debt securities. The
waiver may not be effective under U.S.&nbsp;federal securities
laws, however, and it is the view of the SEC that such a waiver
is against public policy.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='150'></A>
</DIV>

<!-- link1 "Payment and Transfer" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Payment and Transfer</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Trustee will initially act as paying agent and registrar
under each indenture. We may change the paying agent or
registrar without prior notice to the holders of debt
securities, and we or any of our subsidiaries may act as paying
agent or registrar.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If a holder of debt securities has given wire transfer
instructions to us, we will make all payments on the debt
securities in accordance with those instructions. All other
payments on the debt securities will be made at the corporate
trust office of the Trustee located in New York City, unless we
elect to make interest payments by check mailed to the holders
at their addresses set forth in the debt security register.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Trustee and any paying agent will repay to us upon request
any funds held by them for payments on the debt securities that
remain unclaimed for two years after the date upon which that
payment has become due. After payment to us, holders entitled to
the money must look to us for payment as general creditors.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='151'></A>
</DIV>

<!-- link1 "Exchange, Registration and Transfer" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Exchange, Registration and Transfer</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Debt securities of any series will be exchangeable for other
debt securities of the same series, the same total principal
amount and the same terms but in different authorized
denominations in accordance with the indenture. Holders may
present debt securities for exchange or registration of transfer
at the office of the registrar. The registrar will effect the
transfer or exchange when it is satisfied with the documents of
title and identity of the person making the request. We will not
charge a service charge for any registration of transfer or
exchange of the debt securities. We may, however, require the
payment of any tax or other governmental charge payable for that
registration.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We will not be required:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    to issue, register the transfer of, or exchange debt securities
    of a series either during a period beginning 15 business days
    prior to the selection of debt securities of that series for
    redemption or repurchase and ending on the close of business on
    the day of mailing of the relevant notice of redemption or
    repurchase, or between a record date and the next succeeding
    interest payment date;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    to register the transfer of or exchange any debt security called
    for redemption or repurchase, except the unredeemed portion of
    any debt security we are redeeming or repurchasing in part.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">54

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='152'></A>
</DIV>

<!-- link1 "Provisions Relating Only to the Senior Debt Securities" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Provisions Relating Only to the Senior Debt Securities</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The senior debt securities will rank equally in right of payment
with all of our other senior and unsubordinated debt. The senior
debt securities will be effectively subordinated, however, to
all of our secured debt to the extent of the value of the
collateral for that debt. We will disclose the amount of our
secured debt in the prospectus supplement.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='153'></A>
</DIV>

<!-- link1 "Provisions Relating Only to the Subordinated Debt Securities" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Provisions Relating Only to the Subordinated Debt
Securities</B>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Subordinated Debt Securities Subordinated to Senior
    Indebtedness</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The subordinated debt securities will rank junior in right of
payment to all of the Senior Indebtedness of us and any
Subsidiary Guarantors. &#147;Senior Indebtedness&#148; will be
defined in a supplemental indenture for any issuance of a series
of subordinated debt securities, and the definition will be set
forth in the prospectus supplement.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Payment Blockages</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The subordinated indenture will provide that, until the Senior
Indebtedness is paid in full, no payment of principal, interest
and any premium on the subordinated debt securities may be made
in the event:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    we or our assets (or, if applicable, any Subsidiary Guarantor or
    its assets) are involved in any voluntary or involuntary
    liquidation or bankruptcy;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    we fail (or, if applicable, any Subsidiary Guarantor fails) to
    pay the principal, interest, any premium or any other amounts on
    any Senior Indebtedness within any applicable grace period or if
    the maturity of such Senior Indebtedness is accelerated
    following any other default, subject to certain limited
    exceptions set forth in the subordinated indenture;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    any other default on any Senior Indebtedness occurs that permits
    immediate acceleration of its maturity, in which case a payment
    blockage on the subordinated debt securities will be imposed for
    a maximum of 179&nbsp;days at any one time.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As a result of the subordination provisions described above, in
the event of our insolvency, the holders of Senior Indebtedness,
as well as certain of our general creditors, may recover more,
ratably, than the holders of the subordinated debt securities.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>No Limitation on Amount of Senior Debt</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The subordinated indenture will not limit the amount of Senior
Indebtedness that Teekay LNG Partners L.P. may incur, unless
otherwise indicated in the prospectus supplement.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='154'></A>
</DIV>

<!-- link1 "Book Entry, Delivery and Form" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Book Entry, Delivery and Form</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The debt securities of a particular series may be issued in
whole or in part in the form of one or more global certificates
that will be registered in the name of The Depository Trust
Company, New York, New York (or <I>DTC</I>) or its nominee. This
means that we will not issue certificates to each holder.
Instead, one or more global debt securities will be issued to
DTC, who will keep a computerized record of its participants
(for example, your broker) whose clients have purchased the debt
securities. The participant will then keep a record of its
clients who purchased the debt securities. Unless it is
exchanged in whole or in part for a certificated debt security,
a global debt security may not be transferred, except that DTC,
its nominees and their successors may transfer a global debt
security as a whole to one another.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Beneficial interests in global debt securities will be shown on,
and transfers of global debt securities will only be made
through, records maintained by DTC and its participants.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
DTC has made available the following information: DTC is a
limited-purpose trust company organized under the New York
Banking Law, a &#147;banking organization&#148; within the
meaning of the New York Banking Law, a member of the United
States Federal Reserve System, a &#147;clearing corporation&#148;
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">55

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
within the meaning of the New York Uniform Commercial Code and a
&#147;clearing agency&#148; registered under the provisions of
Section&nbsp;17A of the U.S.&nbsp;Securities Exchange Act of
1934. DTC is owned by a number of its participants and by the
New York Stock Exchange, Inc. and the National Association of
Securities Dealers, Inc.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
DTC holds securities that its participants (or <I>Direct
Participants</I>) deposit with DTC. DTC also records the
settlement among Direct Participants of securities transactions,
such as transfers and pledges, in deposited securities through
computerized records for Direct Participants&#146; accounts.
This eliminates the need to exchange certificates. Direct
Participants include securities brokers and dealers, banks,
trust companies, clearing corporations and certain other
organizations.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
DTC&#146;s book-entry system is also used by other organizations
such as securities brokers and dealers, banks and trust
companies that work through a Direct Participant. The rules that
apply to DTC and its participants are on file with the SEC.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We will wire all payments on the global debt securities to DTC
or its nominee. We and the Trustee will treat DTC or its nominee
as the owner of the global debt securities for all purposes.
Accordingly, we, the Trustee and any paying agent will have no
direct responsibility or liability to pay amounts due on the
global debt securities to owners of beneficial interests in the
global debt securities.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
It is DTC&#146;s current practice, upon receipt of any payment
on global debt securities, to credit Direct Participants&#146;
accounts on the payment date according to their respective
holdings of beneficial interests in the global debt securities
as shown on DTC&#146;s records. In addition, it is DTC&#146;s
current practice to assign any consenting or voting rights to
Direct Participants whose accounts are credited with debt
securities on a record date, by using an omnibus proxy. Payments
by participants to owners of beneficial interests in the global
debt securities, and voting by participants, will be governed by
the customary practices between the participants and owners of
beneficial interests, as is the case with debt securities held
for the account of customers registered in &#147;street
name.&#148; However, payments will be the responsibility of the
participants and not of DTC, the Trustee or us.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Debt securities represented by a global debt security will be
exchangeable for certificated debt securities with the same
terms in authorized denominations only if:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    DTC notifies us that it is unwilling or unable to continue as
    depositary or if DTC ceases to be a clearing agency registered
    under applicable law and in either event a successor depositary
    is not appointed by us within 90&nbsp;days;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    we determine not to require all of the debt securities of a
    series to be represented by a global debt security.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='155'></A>
</DIV>

<!-- link1 "Governing Law" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Governing Law</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Each indenture and all of the debt securities will be governed
by the laws of the State of New York.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='156'></A>
</DIV>

<!-- link1 "The Trustee" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>The Trustee</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We will enter into the indentures with a trustee that is
qualified to act under the U.S.&nbsp;Trust Indenture Act of 1939
and with any other trustees chosen by us and appointed in a
supplemental indenture for a particular series of debt
securities. We use the term &#147;Trustee&#148; to refer to the
trustee appointed with respect to any such series of debt
securities. Unless we otherwise specify in the applicable
prospectus supplement, the initial trustee for each series of
debt securities will be The Bank of New York. We may maintain
banking and other commercial relationships with the Trustee and
its affiliates in the ordinary course of business, and the
Trustee may own our debt securities. If at any time two or more
trustees are acting under an indenture, each with respect to
only certain series, the term &#147;debt securities&#148; means
the series of debt securities for which each respective trustee
is acting. If there is more than one trustee under the
indenture, the powers and trust obligations of each trustee will
apply only to the debt securities for
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">56

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
which it is trustee. If two or more trustees are acting under
the indenture, then the debt securities for which each trustee
is acting would be treated as if issued under separate
indentures.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Resignation or Removal of Trustee</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If the Trustee has or acquires a conflicting interest within the
meaning of the Trust Indenture Act of 1939, the Trustee shall
either eliminate its conflicting interest or resign to the
extent and in the manner provided in, and subject to the
provisions of, the Trust Indenture Act and the applicable
indenture. Any resignation due to a conflicting interest or
otherwise will require the appointment of a successor Trustee
under the applicable indenture in accordance with the terms and
conditions of such indenture.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Trustee may resign or be removed by us with respect to one
or more series of debt securities and a successor Trustee may be
appointed to act with respect to any such series. The holders of
a majority in aggregate principal amount of the debt securities
outstanding of any series may remove the Trustee with respect to
the debt securities of such series.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Annual Trustee Report to Holders of Debt Securities</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Trustee is required to submit an annual report to the
holders of the debt securities regarding, among other things,
the Trustee&#146;s eligibility to serve as such, the priority of
the Trustee&#146;s claims regarding certain advances made by it,
and any action taken by the Trustee materially affecting the
debt securities.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Certificates and Opinions to be Furnished to
    Trustee</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Each indenture will provide that, in addition to other
certificates or opinions that may be specifically required by
other provisions of the indenture, every application by us for
action by the Trustee will be accompanied by a certificate of
certain of our officers and an opinion of counsel (which may be
our counsel) stating that, in the opinion of the signers, all
conditions precedent to such action have been complied with by
us.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">57

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='157'></A>
</DIV>

<!-- link1 "MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>MATERIAL U.S.&nbsp;FEDERAL INCOME TAX CONSEQUENCES</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
This section is a discussion of the material U.S.&nbsp;federal
income tax considerations that may be relevant to prospective
common unitholders who are individual citizens or residents of
the United States and, unless otherwise noted in the following
discussion, is the opinion of Perkins Coie LLP, counsel to the
general partner and us, insofar as it relates to matters of
U.S.&nbsp;federal income tax law and legal conclusions with
respect to those matters. This section is based upon provisions
of the U.S.&nbsp;Internal Revenue Code of 1986 (or the
<I>Internal Revenue Code</I>) as in effect on the date of this
prospectus, existing final, temporary and proposed regulations
thereunder (or <I>Treasury Regulations</I>) and current
administrative rulings and court decisions, all of which are
subject to change. Changes in these authorities may cause the
tax consequences to vary substantially from the consequences
described below. Unless the context otherwise requires,
references in this section to &#147;we&#148;, &#147;our&#148; or
&#147;us&#148; are references to Teekay LNG Partners L.P. and
its direct or indirect wholly owned subsidiaries that have
properly elected to be disregarded as entities separate from
Teekay LNG Partners L.P. for U.S.&nbsp;federal tax purposes.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following discussion does not comment on all
U.S.&nbsp;federal income tax matters affecting us or the
unitholders. Moreover, the discussion focuses on unitholders who
are individual citizens or residents of the United States and
hold their units as capital assets and has only limited
application to corporations, estates, trusts,
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>persons
or other unitholders subject to specialized tax treatment, such
as tax-exempt entities (including IRAs), regulated investment
companies (mutual funds) and real estate investment trusts (or
<I>REITs</I>). Accordingly, we urge each prospective unitholder
to consult, and depend on, his own tax advisor in analyzing the
U.S.&nbsp;federal, state, local and
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>tax
consequences particular to him of the ownership or disposition
of common units.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
All statements as to matters of law and legal conclusions, but
not as to factual matters, contained in this section, unless
otherwise noted, are the opinion of Perkins Coie LLP and are
based on the accuracy of the representations made by us to
Perkins Coie LLP for purposes of their opinion.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Except as described below under &#147;&#151;&nbsp;Classification
as a Partnership,&#148; no ruling has been or will be requested
from the IRS regarding any matter affecting us or prospective
unitholders. Instead, we will rely on opinions of Perkins Coie
LLP. Unlike a ruling, an opinion of counsel represents only that
counsel&#146;s best legal judgment and does not bind the IRS or
the courts. Accordingly, the opinions of Perkins Coie LLP may
not be sustained by a court if contested by the IRS. Any contest
of this nature with the IRS may materially and adversely impact
the market for the common units and the prices at which common
units trade. In addition, the costs of any contest with the IRS,
principally legal, accounting and related fees, will result in a
reduction in cash available for distribution to our unitholders
and our general partner and thus will be borne indirectly by our
unitholders and our general partner. Furthermore, our tax
treatment, or the tax treatment of an investment in us, may be
significantly modified by future legislative or administrative
changes or court decisions. Any modifications may or may not be
retroactively applied.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For the reasons described below, Perkins Coie LLP has not
rendered an opinion with respect to the following specific
U.S.&nbsp;federal income tax issues: (1)&nbsp;the treatment of a
unitholder whose common units are loaned to a short seller to
cover a short sale of common units (please read
&#147;&#151;&nbsp;Consequences of Unit Ownership&nbsp;&#151;
Treatment of Short Sales&#148;); (2)&nbsp;whether our method for
depreciating Section&nbsp;743 adjustments is sustainable in
certain cases (please read &#147;&#151;&nbsp;Consequences of
Unit Ownership&nbsp;&#151; Section&nbsp;754 Election&#148;); and
(3)&nbsp;whether our monthly convention for allocating taxable
income and losses is permitted by existing Treasury Regulations
(please read &#147;&#151;&nbsp;Disposition of Common
Units&nbsp;&#151; Allocations Between Transferors and
Transferees&#148;). Perkins Coie LLP has not rendered an opinion
on any state, local or
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>tax
matters.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='158'></A>
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Classification as a Partnership</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For purposes of U.S.&nbsp;federal income taxation, a partnership
is not a taxable entity, and although it may be subject to
withholding taxes on behalf of its partners under certain
circumstances, a partnership itself incurs no U.S.&nbsp;federal
income tax liability. Instead, each partner of a partnership is
required to take into account his share of items of income,
gain, loss, deduction and credit of the partnership in computing
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
his U.S.&nbsp;federal income tax liability, regardless of
whether cash distributions are made to him by the partnership.
Distributions by a partnership to a partner generally are not
taxable unless the amount of cash distributed exceeds the
partner&#146;s adjusted tax basis in his partnership interest.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Section&nbsp;7704 of the Internal Revenue Code provides that
publicly traded partnerships, as a general rule, will be treated
as corporations for U.S.&nbsp;federal income tax purposes.
However, an exception, referred to as the &#147;Qualifying
Income Exception,&#148; exists with respect to publicly traded
partnerships whose &#147;qualifying income&#148; represents 90%
or more of their gross income for every taxable year. Qualifying
income includes income and gains derived from the transportation
and storage of crude oil, natural gas and products thereof,
including liquefied natural gas. Other types of qualifying
income include interest (other than from a financial business),
dividends, gains from the sale of real property and gains from
the sale or other disposition of capital assets held for the
production of qualifying income, including stock. We have
received a ruling from the IRS that we requested in connection
with our initial public offering that the income we derive from
transporting LNG and crude oil pursuant to time charters
existing at the time of our initial public offering is
qualifying income within the meaning of Section&nbsp;7704. A
ruling from the IRS, while generally binding on the IRS, may
under certain circumstances be revoked or modified by the IRS
retroactively. As to income that is not covered by the IRS
ruling, we will rely upon the opinion of Perkins Coie LLP
whether the income is qualifying income.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We estimate that less than 5% of our current income is not
qualifying income; however, this estimate could change from time
to time. A number of factors could cause the percentage of our
income that is qualifying income to vary. For example, we have
not received an IRS ruling or an opinion of counsel that any
income or gain we recognize from foreign currency transactions
or from interest rate swaps is qualifying income. Under some
circumstances, such as a significant increase in interest rates,
the percentage of such income or gain in relation to our total
gross income could be substantial. However, we do not expect
income or gains from foreign currency transactions or interest
rate swaps to constitute a significant percentage of our current
or future gross income for U.S.&nbsp;federal income tax purposes.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Perkins Coie LLP is of the opinion that, based upon the Internal
Revenue Code, Treasury Regulations thereunder, published revenue
rulings and court decisions, the IRS ruling and representations
described below, we will be classified as a partnership for
U.S.&nbsp;federal income tax purposes.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In rendering its opinion, Perkins Coie LLP has relied on factual
representations made by us and the general partner. The
representations made by us and our general partner upon which
Perkins Coie LLP has relied are:
</DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    We have not elected and will not elect to be treated as a
    corporation, and each of our direct or indirect wholly-owned
    subsidiaries has properly elected to be disregarded as an entity
    separate from us, for U.S.&nbsp;federal income tax
    purposes;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    For each taxable year, at least 90% of our gross income will be
    either (a)&nbsp;income to which the IRS ruling described above
    applies or (b)&nbsp;of a type that Perkins Coie LLP has opined
    or will opine is &#147;qualifying income&#148; within the
    meaning of Section&nbsp;7704(d) of the Internal Revenue Code.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The discussion that follows is based on the assumption that we
will be treated as a partnership for U.S.&nbsp;federal income
tax purposes. Please read &#147;&#151;&nbsp;Possible
Classification as a Corporation&#148; below for a discussion of
the consequences of our failing to be treated as a partnership
for such purposes.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='159'></A>
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Status as a Partner</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The treatment of unitholders described in this section applies
only to unitholders treated as partners in us for
U.S.&nbsp;federal income tax purposes. Unitholders who have been
properly admitted as limited partners of Teekay LNG Partners
L.P. will be treated as partners in us for U.S.&nbsp;federal
income tax purposes. Also:
</DIV>

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    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
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<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    assignees of common units who have executed and delivered
    transfer applications, and are awaiting admission as limited
    partners;&nbsp;and</TD>
</TR>

</TABLE>

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<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    unitholders whose common units are held in street name or by a
    nominee and who have the right to direct the nominee in the
    exercise of all substantive rights attendant to the ownership of
    their common units will be treated as partners in us for
    U.S.&nbsp;federal income tax purposes.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Because no direct authority addresses the status of assignees of
common units who are entitled to execute and deliver transfer
applications and thereby become entitled to direct the exercise
of attendant rights, but who fail to execute and deliver
transfer applications, Perkins Coie LLP&#146;s opinion does not
extend to these persons. Furthermore, a purchaser or other
transferee of common units who does not execute and deliver a
transfer application may not receive some U.S.&nbsp;federal
income tax information or reports furnished to record holders of
common units, unless the common units are held in a nominee or
street name account and the nominee or broker has executed and
delivered a transfer application for those common units.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Under certain circumstances, a beneficial owner of common units
whose units have been loaned to another may lose his status as a
partner with respect to those units for U.S.&nbsp;federal income
tax purposes. Please read &#147;&#151;&nbsp;Consequences of Unit
Ownership&nbsp;&#151; Treatment of Short Sales&#148; below.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In general, a person who is not a partner in a partnership for
U.S.&nbsp;federal income tax purposes is not required or
permitted to report any share of the partnership&#146;s income,
gain, deductions or losses for such purposes, and any cash
distributions received by such a person from the partnership
therefore may be fully taxable as ordinary income. Unitholders
not described here are urged to consult their own tax advisors
with respect to their status as partners in us for
U.S.&nbsp;federal income tax purposes.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='160'></A>
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Consequences of Unit Ownership</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Flow-through of Taxable Income.</I></B> Each unitholder is
required to include in computing his taxable income his
allocable share of our income, gains, losses and deductions for
our taxable year ending with or within his taxable year, without
regard to whether we make corresponding cash distributions to
him. Our taxable year ends on December&nbsp;31. Consequently, we
may allocate income to a unitholder as of December&nbsp;31 of a
given year, and the unitholder will be required to report this
income on his tax return for his tax year that ends on or
includes such date, even if he has not received a cash
distribution from us as of that date.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Treatment of Distributions.</I></B> Distributions by us to
a unitholder generally will not be taxable to the unitholder for
U.S.&nbsp;federal income tax purposes to the extent of his tax
basis in his common units immediately before the distribution.
Our cash distributions in excess of a unitholder&#146;s tax
basis generally will be considered to be gain from the sale or
exchange of the common units, taxable in accordance with the
rules described under &#147;&#151;&nbsp;Disposition of Common
Units&#148; below. Any reduction in a unitholder&#146;s share of
our liabilities for which no partner, including the general
partner, bears the economic risk of loss, known as
&#147;nonrecourse liabilities,&#148; will be treated as a
distribution of cash to that unitholder. To the extent our
distributions cause a unitholder&#146;s &#147;at risk&#148;
amount to be less than zero at the end of any taxable year, he
must recapture any losses deducted in previous years. Please
read &#147;&#151;&nbsp;Limitations on Deductibility of
Losses.&#148;
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A decrease in a unitholder&#146;s percentage interest in us
because of our issuance of additional common units will decrease
his share of our nonrecourse liabilities, and thus will result
in a corresponding deemed distribution of cash. A non-pro rata
distribution of money or property may result in ordinary income
to a unitholder, regardless of his tax basis in his common
units, if the distribution reduces the unitholder&#146;s share
of our &#147;unrealized receivables,&#148; including
depreciation recapture, and/or substantially appreciated
&#147;inventory items,&#148; both as defined in the Internal
Revenue Code (or, collectively, <I>Section&nbsp;751 Assets</I>).
To that extent, he will be treated as having been distributed
his proportionate share of the Section&nbsp;751 Assets and
having exchanged those assets with us in return for the non-pro
rata portion of the actual distribution made to him. This latter
deemed exchange will generally result in the unitholder&#146;s
realization of ordinary income, which will equal the excess of
(1)&nbsp;the non-pro rata portion of that distribution over
(2)&nbsp;the unitholder&#146;s tax basis for the share of
Section&nbsp;751 Assets deemed relinquished in the exchange.
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Basis of Common Units.</I></B> A unitholder&#146;s initial
U.S.&nbsp;federal income tax basis for his common units will be
the amount he paid for the common units plus his share of our
nonrecourse liabilities. That basis will be increased by his
share of our income and by any increases in his share of our
nonrecourse liabilities. That basis will be decreased, but not
below zero, by distributions from us, by the unitholder&#146;s
share of our losses, by any decreases in his share of our
nonrecourse liabilities and by his share of our expenditures
that are not deductible in computing taxable income and are not
required to be capitalized. A unitholder will have no share of
our debt that is recourse to the general partner, but will have
a share, generally based on his share of profits, of our
nonrecourse liabilities. Please read
&#147;&#151;&nbsp;Disposition of Common Units&nbsp;&#151;
Recognition of Gain or Loss.&#148;
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Limitations on Deductibility of Losses.</I></B> The
deduction by a unitholder of his share of our losses will be
limited to the tax basis in his units and, in the case of an
individual unitholder or a corporate unitholder, if more than
50% of the value of the corporate unitholder&#146;s stock is
owned directly or indirectly by five or fewer individuals or
some tax-exempt organizations, to the amount for which the
unitholder is considered to be &#147;at risk&#148; with respect
to our activities, if that is less than his tax basis. A
unitholder must recapture losses deducted in previous years to
the extent that distributions cause his at risk amount to be
less than zero at the end of any taxable year. Losses disallowed
to a unitholder or recaptured as a result of these limitations
will carry forward and will be allowable to the extent that his
tax basis or at risk amount, whichever is the limiting factor,
is subsequently increased. Upon the taxable disposition of a
unit, any gain recognized by a unitholder can be offset by
losses that were previously suspended by the at risk limitation
but may not be offset by losses suspended by the basis
limitation. Any excess suspended loss above that gain is no
longer utilizable. In general, a unitholder will be at risk to
the extent of the tax basis of his units, excluding any portion
of that basis attributable to his share of our nonrecourse
liabilities, reduced by any amount of money he borrows to
acquire or hold his units, if the lender of those borrowed funds
owns an interest in us, is related to the unitholder or can look
only to the units for repayment.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The passive loss limitations generally provide that individuals,
estates, trusts and some closely-held corporations and personal
service corporations can deduct losses from a passive activity
only to the extent of the taxpayer&#146;s income from the same
passive activity. Passive activities generally are corporate or
partnership activities in which the taxpayer does not materially
participate. The passive loss limitations are applied separately
with respect to each publicly traded partnership. Consequently,
any passive losses we generate only will be available to offset
our passive income generated in the future and will not be
available to offset income from other passive activities or
investments, including our investments or investments in other
publicly traded partnerships, or salary or active business
income. Passive losses that are not deductible because they
exceed a unitholder&#146;s share of income we generate may be
deducted in full when he disposes of his entire investment in us
in a fully taxable transaction with an unrelated party. The
passive activity loss rules are applied after other applicable
limitations on deductions, including the at risk rules and the
basis limitation.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Dual consolidated loss restrictions also may apply to limit the
deductibility by a corporate unitholder of losses we incur.
Corporate unitholders are urged to consult their own tax
advisors regarding the applicability and effect to them of dual
consolidated loss restrictions.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Limitations on Interest Deductions.</I></B> The
deductibility of a non-corporate taxpayer&#146;s
&#147;investment interest expense&#148; generally is limited to
the amount of that taxpayer&#146;s &#147;net investment
income.&#148; Investment interest expense includes:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    interest on indebtedness properly allocable to property held for
    investment;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our interest expense attributed to portfolio income;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the portion of interest expense incurred to purchase or carry an
    interest in a passive activity to the extent attributable to
    portfolio income.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The computation of a unitholder&#146;s investment interest
expense will take into account interest on any margin account
borrowing or other loan incurred to purchase or carry a unit.
Net investment income includes gross income from property held
for investment and amounts treated as portfolio income under
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
the passive loss rules, less deductible expenses, other than
interest, directly connected with the production of investment
income, but generally does not include gains attributable to the
disposition of property held for investment. The IRS has
indicated that net passive income earned by a publicly traded
partnership will be treated as investment income to its
unitholders. In addition, the unitholder&#146;s share of our
portfolio income will be treated as investment income.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Entity-Level&nbsp;Collections.</I></B> If we are required
or elect under applicable law to pay any U.S.&nbsp;federal,
state or local or foreign income or withholding taxes on behalf
of any present or former unitholder or the general partner, we
are authorized to pay those taxes from our funds. That payment,
if made, will be treated as a distribution of cash to the
partner on whose behalf the payment was made. If the payment is
made on behalf of a person whose identity cannot be determined,
we are authorized to treat the payment as a distribution to all
current unitholders. We are authorized to amend the partnership
agreement in the manner necessary to maintain uniformity of
intrinsic tax characteristics of units and to adjust later
distributions, so that after giving effect to these
distributions, the priority and characterization of
distributions otherwise applicable under the partnership
agreement are maintained as nearly as is practicable. Payments
by us as described above could give rise to an overpayment of
tax on behalf of an individual partner, in which event the
partner would be required to file a claim in order to obtain a
credit or refund of tax paid.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Allocation of Income, Gain, Loss, Deduction and
Credit.</I></B> In general, if we have a net profit, our items
of income, gain, loss, deduction and credit will be allocated
among the general partner and the unitholders in accordance with
their percentage interests in us. At any time that distributions
are made to the common units in excess of distributions to the
subordinated units, or incentive distributions are made to the
general partner, gross income will be allocated to the
recipients to the extent of these distributions. If we have a
net loss for the entire year, that loss generally will be
allocated first to the general partner and the unitholders in
accordance with their percentage interests in us to the extent
of their positive capital accounts and, second, to the general
partner.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Specified items of our income, gain, loss and deduction will be
allocated to account for any difference between the tax basis
and fair market value of any property held by the partnership
immediately prior to an offering of common units, referred to in
this discussion as &#147;Adjusted Property.&#148; The effect of
these allocations to a unitholder purchasing common units in an
offering will be essentially the same as if the tax basis of our
assets were equal to their fair market value at the time of the
offering. In addition, items of recapture income will be
allocated to the extent possible to the partner who was
allocated the deduction giving rise to the treatment of that
gain as recapture income in order to minimize the recognition of
ordinary income by some unitholders. Finally, although we do not
expect that our operations will result in the creation of
negative capital accounts, if negative capital accounts
nevertheless result, items of our income and gain will be
allocated in an amount and manner to eliminate the negative
balance as quickly as possible.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
An allocation of items of our income, gain, loss, deduction or
credit, other than an allocation required by the Internal
Revenue Code to eliminate the difference between a
partner&#146;s &#147;book&#148; capital account, which is
credited with the fair market value of Adjusted Property, and
&#147;tax&#148; capital account, which is credited with the tax
basis of Adjusted Property, referred to in this discussion as
the &#147;Book-Tax Disparity,&#148; will generally be given
effect for U.S.&nbsp;federal income tax purposes in determining
a partner&#146;s share of an item of income, gain, loss,
deduction or credit only if the allocation has substantial
economic effect. In any other case, a partner&#146;s share of an
item will be determined on the basis of his interest in us,
which will be determined by taking into account all the facts
and circumstances, including:
</DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    his relative contributions to us;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the interests of all the partners in profits and losses;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the interest of all the partners in cash flow;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the rights of all the partners to distributions of capital upon
    liquidation.</TD>
</TR>

</TABLE>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Perkins Coie LLP is of the opinion that, with the exception of
the issues described in &#147;&#151;&nbsp;Consequences of Unit
Ownership&nbsp;&#151; Section&nbsp;754 Election&#148; and
&#147;&#151;&nbsp;Disposition of Common Units&nbsp;&#151;
Allocations Between Transferors and Transferees,&#148;
allocations under our partnership agreement will be given effect
for U.S.&nbsp;federal income tax purposes in determining a
partner&#146;s share of an item of income, gain, loss, deduction
or credit.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Treatment of Short Sales.</I></B> A unitholder whose units
are loaned to a &#147;short seller&#148; who sells such units
may be considered to have disposed of those units. If so, he
would no longer be a partner with respect to those units until
the termination of the loan and may recognize gain or loss from
the disposition. As a result:
</DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    any of our income, gain, loss, deduction or credit with respect
    to the units may not be reportable by the unitholder who loaned
    them;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    any cash distributions received by such unitholder with respect
    to those units may be fully taxable as ordinary income.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Perkins Coie LLP has not rendered an opinion regarding the
treatment of a unitholder whose common units are loaned to a
short seller. Therefore, unitholders desiring to assure their
status as partners and avoid the risk of gain recognition from a
loan to a short seller are urged to ensure that any applicable
brokerage account agreements prohibit their brokers from
borrowing their units. The IRS has announced that it is actively
studying issues relating to the tax treatment of short sales of
partnership interests. Please also read
&#147;&#151;&nbsp;Disposition of Common Units&nbsp;&#151;
Recognition of Gain or Loss.&#148;
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Alternative Minimum Tax.</I></B> Each unitholder will be
required to take into account his distributive share of any
items of our income, gain, loss, deduction or credit for
purposes of the alternative minimum tax. The current minimum tax
rate for noncorporate taxpayers is 26% on the first $175,000 of
alternative minimum taxable income in excess of the exemption
amount and 28% on any additional alternative minimum taxable
income. Prospective unitholders are urged to consult with their
tax advisors as to the impact of an investment in units on their
liability for the alternative minimum tax.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Tax Rates.</I></B> The highest statutory rate of
U.S.&nbsp;federal income tax for individuals currently is 35%,
and the highest statutory rate of U.S.&nbsp;federal income tax
imposed on net capital gains of an individual currently is 15%
if the asset disposed of was held for more than one year at the
time of disposition.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Section&nbsp;754 Election.</I></B> We intend to make an
election under Section&nbsp;754 of the Internal Revenue Code to
adjust a common unit purchaser&#146;s U.S.&nbsp;federal income
tax basis in our assets (or <I>inside basis</I>) to reflect the
purchaser&#146;s purchase price (or a <I>Section&nbsp;743(b)
adjustment</I>). The Section&nbsp;743(b) adjustment belongs to
the purchaser and not to other unitholders and does not apply to
unitholders who acquire their common units directly from us. For
purposes of this discussion, a unitholder&#146;s inside basis in
our assets will be considered to have two components:
(1)&nbsp;his share of our tax basis in our assets (or <I>common
basis</I>) and (2)&nbsp;his Section&nbsp;743(b) adjustment to
that basis.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In general, a purchaser&#146;s common basis is depreciated or
amortized according to the existing method utilized by us. A
positive Section&nbsp;743(b) adjustment to that basis generally
is depreciated or amortized in the same manner as property of
the same type that has been newly placed in service by us. A
negative Section&nbsp;743(b) adjustment to that basis generally
is recovered over the remaining useful life of the
partnership&#146;s recovery property.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A Section&nbsp;743(b) adjustment is advantageous if the
purchaser&#146;s tax basis in his units is higher than the
units&#146; share of the aggregate tax basis of our assets
immediately prior to the transfer. In that case, as a result of
the adjustment, the purchaser would have, among other items, a
greater amount of depreciation and amortization deductions and
his share of any gain or loss on a sale of our assets would be
less. Conversely, a Section&nbsp;743(b) adjustment is
disadvantageous if the purchaser&#146;s tax basis in his units
is lower than those units&#146; share of the aggregate tax basis
of our assets immediately prior to the purchase. Thus, the fair
market value of the units may be affected either favorably or
unfavorably by the Section&nbsp;743(b) adjustment. A basis
adjustment is required regardless of whether a Section&nbsp;754
election is
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
made in the case of a transfer on an interest in us if we have a
substantial <FONT style="white-space: nowrap">built-in</FONT>
loss immediately after the transfer, or if we distribute
property and have a substantial basis reduction. Generally, a
<FONT style="white-space: nowrap">built-in</FONT> loss or a
basis reduction is substantial if it exceeds $250,000.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The calculations involved in the Section&nbsp;743(b) adjustment
are complex and will be made on the basis of assumptions as to
the value of our assets and in accordance with the Internal
Revenue Code and applicable Treasury Regulations. We cannot
assure you that the determinations we make will not be
successfully challenged by the IRS and that the deductions
resulting from them will not be reduced or disallowed
altogether. Should the IRS require a different basis adjustment
to be made, and should, in our judgment, the expense of
compliance exceed the benefit of the election, we may seek
consent from the IRS to revoke our Section&nbsp;754 election. If
such consent is given, a subsequent purchaser of units may be
allocated more income than he would have been allocated had the
election not been revoked.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='161'></A>
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Tax Treatment of Operations</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Accounting Method and Taxable Year.</I></B> We use the
year ending December&nbsp;31 as our taxable year and the accrual
method of accounting for U.S.&nbsp;federal income tax purposes.
Each unitholder will be required to include in income his share
of our income, gain, loss, deduction and credit for our taxable
year ending within or with his taxable year. In addition, a
unitholder who disposes of all of his units must include his
share of our income, gain, loss, deduction and credit through
the date of disposition in income for his taxable year that
includes the date of disposition, with the result that a
unitholder who has a taxable year ending on a date other than
December&nbsp;31 and who disposes of all of his units following
the close of our taxable year but before the close of his
taxable year must include his share of more than one year of our
income, gain, loss, deduction and credit in income for the year
of the disposition. Please read &#147;&#151;&nbsp;Disposition of
Common Units&nbsp;&#151; Allocations Between Transferors and
Transferees.&#148;
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Asset Tax Basis, Depreciation and Amortization.</I></B>
The tax basis of our assets will be used for purposes of
computing depreciation and cost recovery deductions and,
ultimately, gain or loss on the disposition of these assets. The
U.S.&nbsp;federal income tax burden associated with any
difference between the fair market value of our assets and their
tax basis immediately prior to this offering will be borne by
the general partner and the existing limited partners. Please
read &#147;&#151;&nbsp;Consequences of Unit
Ownership&nbsp;&#151; Allocation of Income, Gain, Loss and
Deduction.&#148;
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
To the extent allowable, we may elect to use the depreciation
and cost recovery methods that will result in the largest
deductions being taken in the early years after assets are
placed in service. Property we subsequently acquire or construct
may be depreciated using any method permitted by the Internal
Revenue Code.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If we dispose of depreciable property by sale, foreclosure or
otherwise, all or a portion of any gain, determined by reference
to the amount of depreciation previously deducted and the nature
of the property, may be subject to the recapture rules and taxed
as ordinary income rather than capital gain. Similarly, a
unitholder who has taken cost recovery or depreciation
deductions with respect to property we own will likely be
required to recapture some or all of those deductions as
ordinary income upon a sale of his interest in us. Please read
&#147;&#151;&nbsp;Consequences of Unit Ownership&nbsp;&#151;
Allocation of Income, Gain, Loss, Deduction and Credit&#148; and
&#147;&#151;&nbsp;Disposition of Common Units&nbsp;&#151;
Recognition of Gain or Loss.&#148;
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The costs incurred by us in selling our units (or <I>syndication
expenses</I>) must be capitalized and cannot be deducted
currently, ratably or upon our termination. There are
uncertainties regarding the classification of costs as
syndication expenses. The underwriting discounts and commissions
we incur will be treated as syndication expenses.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Valuation and Tax Basis of Our Properties.</I></B> The
U.S.&nbsp;federal income tax consequences of the ownership and
disposition of units will depend in part on our estimates of the
relative fair market values, and the initial tax bases, of our
assets. Although we may from time to time consult with
professional appraisers regarding valuation matters, we will
make many of the relative fair market value estimates ourselves.
These estimates and determinations of basis are subject to
challenge and will not be binding on
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">64

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the IRS or the courts. If the estimates of fair market value or
basis are later found to be incorrect, the character and amount
of items of income, gain, loss, deductions or credits previously
reported by unitholders might change, and unitholders might be
required to adjust their tax liability for prior years and incur
interest and penalties with respect to those adjustments.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='162'></A>
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Disposition of Common Units</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Recognition of Gain or Loss.</I></B> In general, gain or
loss will be recognized on a sale of units equal to the
difference between the amount realized and the unitholder&#146;s
tax basis in the units sold. A unitholder&#146;s amount realized
will be measured by the sum of the cash, the fair market value
of other property received by him and his share of our
nonrecourse liabilities. Because the amount realized includes a
unitholder&#146;s share of our nonrecourse liabilities, the gain
recognized on the sale of units could result in a tax liability
in excess of any cash or property received from the sale.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Prior distributions from us in excess of cumulative net taxable
income for a common unit that decreased a unitholder&#146;s tax
basis in that common unit will, in effect, become taxable income
if the common unit is sold at a price greater than the
unitholder&#146;s tax basis in that common unit, even if the
price received is less than his original cost. Except as noted
below, gain or loss recognized by a unitholder on the sale or
exchange of a unit generally will be taxable as capital gain or
loss. Capital gain recognized by an individual on the sale of
units held more than one year generally will be taxed at a
maximum rate of 15% under current law.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A portion of a unitholder&#146;s amount realized may be
allocable to &#147;unrealized receivables&#148; or to
&#147;inventory items&#148; we own. The term &#147;unrealized
receivables&#148; includes potential recapture items, including
depreciation and amortization recapture. A unitholder will
recognize ordinary income or loss to the extent of the
difference between the portion of the unitholder&#146;s amount
realized allocable to unrealized receivables or inventory items
and the unitholder&#146;s share of our basis in such receivables
or inventory items. Ordinary income attributable to unrealized
receivables, inventory items and depreciation or amortization
recapture may exceed net taxable gain realized upon the sale of
a unit and may be recognized even if a net taxable loss is
realized on the sale of a unit. Thus, a unitholder may recognize
both ordinary income and a capital loss upon a sale of units.
Net capital losses generally may only be used to offset capital
gains. An exception permits individuals to offset up to $3,000
of net capital losses against ordinary income in any given year.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The IRS has ruled that a partner who acquires interests in a
partnership in separate transactions must combine those
interests and maintain a single adjusted tax basis for all those
interests. Upon a sale or other disposition of less than all of
those interests, a portion of that tax basis must be allocated
to the interests sold using an &#147;equitable
apportionment&#148; method. Treasury Regulations under
Section&nbsp;1223 of the Internal Revenue Code allow a selling
unitholder who can identify common units transferred with an
ascertainable holding period to elect to use the actual holding
period of the common units transferred. Thus, according to the
ruling, a common unitholder will be unable to select high or low
basis common units to sell as would be the case with corporate
stock, but, according to the regulations, may designate specific
common units sold for purposes of determining the holding period
of units transferred. A unitholder electing to use the actual
holding period of common units transferred must consistently use
that identification method for all subsequent sales or exchanges
of common units. A unitholder considering the purchase of
additional units or a sale of common units purchased in separate
transactions is urged to consult his tax advisor as to the
possible consequences of this ruling and application of the
regulations.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Specific provisions of the Internal Revenue Code affect the
taxation of some financial products and securities, including
partnership interests, by treating a taxpayer as having sold an
&#147;appreciated&#148; partnership interest, one in which gain
would be recognized if it were sold, assigned or terminated at
its fair market value, if the taxpayer or related persons
enter(s) into:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    a short sale;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    an offsetting notional principal contract;&nbsp;or</TD>
</TR>

</TABLE>

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<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    a futures or forward contract with respect to the partnership
    interest or substantially identical property.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Moreover, if a taxpayer has previously entered into a short
sale, an offsetting notional principal contract or a futures or
forward contract with respect to the partnership interest, the
taxpayer will be treated as having sold that position if the
taxpayer or a related person then acquires the partnership
interest or substantially identical property. The Secretary of
the Treasury is also authorized to issue regulations that treat
a taxpayer that enters into transactions or positions that have
substantially the same effect as the preceding transactions as
having constructively sold the financial position.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Allocations Between Transferors and Transferees.</I></B>
In general, our taxable income or loss will be determined
annually, will be prorated on a monthly basis and will be
subsequently apportioned among the unitholders in proportion to
the number of units owned by each of them as of the opening of
the applicable exchange on the first business day of the month.
However, gain or loss realized on a sale or other disposition of
our assets other than in the ordinary course of business will be
allocated among the unitholders on the first business day of the
month in which that gain or loss is recognized. As a result of
the foregoing, a unitholder transferring units may be allocated
income, gain, loss, deduction and credit realized after the date
of transfer.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The use of this method for allocating income and deductions
among unitholders may not be permitted under existing Treasury
Regulations. Accordingly, Perkins Coie LLP is unable to opine on
its validity. If this method were disallowed or applied only to
transfers of less than all of the unitholder&#146;s interest,
our taxable income or losses may be reallocated among the
unitholders. We are authorized to revise our method of
allocation to conform to a method permitted under any future
Treasury Regulations or administrative guidance.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A unitholder who owns units at any time during a calendar
quarter and who disposes of them prior to the record date set
for a cash distribution for that quarter will be allocated items
of our income, gain, loss and deductions attributable to months
within that quarter in which the units were held but will not be
entitled to receive that cash distribution.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Transfer Notification Requirements.</I></B> A unitholder
who sells any of his units, other than through a broker,
generally is required to notify us in writing of that sale
within 30&nbsp;days after the sale (or, if earlier, January 15
of the year following the sale). A unitholder who acquires units
generally is required to notify us in writing of that
acquisition within 30&nbsp;days after the purchase, unless a
broker or nominee will satisfy such requirement. We are required
to notify the IRS of any such transfers of units and to furnish
specified information to the transferor and transferee. Failure
to notify us of a transfer of units may lead to the imposition
of substantial penalties.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Constructive Termination.</I></B> We will be considered to
have been terminated for U.S. federal income tax purposes if
there is a sale or exchange of 50% or more of the total
interests in our capital and profits within a
<FONT style="white-space: nowrap">12-month</FONT> period. A
constructive termination results in the closing of our taxable
year for all unitholders. In the case of a unitholder reporting
on a taxable year other than a fiscal year ending
December&nbsp;31, the closing of our taxable year may result in
more than 12&nbsp;months of our taxable income or loss being
includable in his taxable income for the year of termination. We
would be required to make new tax elections after a termination,
including a new election under Section&nbsp;754 of the Internal
Revenue Code, and a termination would result in a deferral of
our deductions for depreciation. A termination could also result
in penalties if we were unable to determine that the termination
had occurred. Moreover, a termination might either accelerate
the application of, or subject us to, tax legislation applicable
to a newly formed partnership.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='163'></A>
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Foreign Tax Credit Considerations</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Subject to detailed limitations set forth in the Internal
Revenue Code, a unitholder may elect to claim a credit against
his liability for U.S.&nbsp;federal income tax for his share of
foreign income taxes (and certain foreign taxes imposed in lieu
of a tax based upon income) paid by us. Income allocated to
unitholders
</DIV>

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likely will constitute foreign source income falling in the
general foreign tax credit category for purposes of the
U.S.&nbsp;foreign tax credit limitation. The rules relating to
the determination of the foreign tax credit are complex and
prospective unitholders are urged to consult their own tax
advisors to determine whether or to what extent they would be
entitled to such credit. Unitholders who do not elect to claim
foreign tax credits may instead claim a deduction for their
shares of foreign taxes paid by us.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='164'></A>
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Tax-Exempt Organizations and
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Investors</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Investments in units by employee benefit plans, other tax-exempt
organizations and
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>persons,
including nonresident aliens of the United States,
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>corporations
and
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>trusts
and estates (collectively,
<FONT style="white-space: nowrap"><I>non-U.S.&nbsp;</FONT>unitholders</I>)
raise issues unique to those investors and, as described below,
may result in substantially adverse tax consequences to them.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Employee benefit plans and most other organizations exempt from
U.S.&nbsp;federal income tax, including individual retirement
accounts and other retirement plans, are subject to
U.S.&nbsp;federal income tax on unrelated business taxable
income. Virtually all of our income allocated to a unitholder
that is a tax-exempt organization will be unrelated business
taxable income to them subject to U.S.&nbsp;federal income tax.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>unitholder
may be subject to a 4% U.S.&nbsp;federal income tax on his share
of the U.S.&nbsp;source portion of our gross income attributable
to transportation that begins or ends (but not both) in the
United States, unless either (a)&nbsp;an exemption applies and
he files a U.S.&nbsp;federal income tax return to claim that
exemption or (b)&nbsp;that income is effectively connected with
the conduct of a trade or business in the United States (or
<I>U.S.&nbsp;effectively connected income</I>). For this
purpose, transportation income includes income from the use,
hiring or leasing of a vessel to transport cargo, or the
performance of services directly related to the use of any
vessel to transport cargo. The U.S.&nbsp;source portion of our
transportation income is deemed to be 50% of the income
attributable to voyages that begin or end in the United States.
Generally, no amount of the income from voyages that begin and
end outside the United States is treated as U.S.&nbsp;source,
and consequently none of our transportation income attributable
to such voyages is subject to U.S.&nbsp;federal income tax.
Although the entire amount of transportation income from voyages
that begin and end in the United States would be fully taxable
in the United States, we currently do not expect to have any
transportation income from voyages that begin and end in the
United States; however, there is no assurance that such voyages
will not occur.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>unitholder
may be entitled to an exemption from the 4% U.S.&nbsp;federal
income tax or a refund of tax withheld on U.S.&nbsp;effectively
connected income that constitutes transportation income if any
of the following applies: (1)&nbsp;such
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>unitholder
qualifies for an exemption from this tax under an income tax
treaty between the United States and the country where such
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>unitholder
is resident; (2)&nbsp;in the case of an individual
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>unitholder,
he qualifies for the exemption from tax under
Section&nbsp;872(b)(1) of the Internal Revenue Code as a
resident of a country that grants an equivalent exemption from
tax to residents of the United States; or (3)&nbsp;in the case
of a corporate
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>unitholder,
it qualifies for the exemption from tax under Section&nbsp;883
of the Internal Revenue Code (or the <I>Section&nbsp;883
Exemption</I>) (for the rules relating to qualification for the
Section&nbsp;883 Exemption, please read below under
&#147;&#151;&nbsp;Possible Classification as a
Corporation&nbsp;&#151; The Section&nbsp;883 Exemption&#148;).
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We may be required to withhold U.S.&nbsp;federal income tax,
computed at the highest statutory rate, from cash distributions
to
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>unitholders
with respect to their shares of our income that is
U.S.&nbsp;effectively connected income. Our transportation
income generally should not be treated as U.S.&nbsp;effectively
connected income unless we have a fixed place of business in the
United States involved in the earning of that transportation
income and certain other requirements are satisfied. While we do
not expect to have a fixed place of business in the United
States, there can be no guarantee that this will not change.
Under a ruling of the IRS, a portion of any gain recognized on
the sale or other disposition of a unit by a
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>unitholder
may be treated as U.S.&nbsp;effectively connected income to the
extent we have a fixed place of business in the United States
and a sale of our assets would have given rise to
U.S.&nbsp;effectively connected income. A
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>unitholder
would be required to file a U.S.&nbsp;federal income
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
tax return to report his U.S.&nbsp;effectively connected income
(including his share of any such income earned by us) and to pay
U.S.&nbsp;federal income tax, or claim a credit or refund for
tax withheld on such income. Further, unless an exemption
applies, a
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>corporation
investing in units may be subject to a branch profits tax, at a
30% rate or lower rate prescribed by a treaty, with respect to
its U.S.&nbsp;effectively connected income.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>unitholders
must apply for and obtain a U.S.&nbsp;taxpayer identification
number in order to file U.S.&nbsp;federal income tax returns and
must provide that identification number to us for purposes of
any U.S.&nbsp;federal income tax information returns we may be
required to file.
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>unitholders
are encouraged to consult with their own tax advisors regarding
the U.S.&nbsp;federal, state and local tax consequences of an
investment in units and any filing requirements related thereto.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='165'></A>
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Functional Currency</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are required to determine the functional currency of any of
our operations that constitute a separate qualified business
unit (or <I>QBU</I>) for U.S.&nbsp;federal income tax purposes
and report the affairs of any QBU in this functional currency to
our unitholders. Any transactions conducted by us other than in
the U.S.&nbsp;dollar or by a QBU other than in its functional
currency may give rise to foreign currency exchange gain or
loss. Further, if a QBU is required to maintain a functional
currency other than the U.S.&nbsp;dollar, a unitholder may be
required to recognize foreign currency translation gain or loss
upon a distribution of money or property from a QBU or upon the
sale of common&nbsp;units, and items or income, gain, loss or
deduction allocated to the unitholder in such functional
currency must be translated into the unitholder&#146;s
functional currency.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For purposes of the foreign currency rules, a QBU includes a
separate trade or business owned by a partnership in the event
separate books and records are maintained for that separate
trade or business. The functional currency of a QBU is
determined based upon the economic environment in which the QBU
operates. Thus, a QBU whose revenues and expenses are primarily
determined in a currency other than the U.S.&nbsp;dollar will
have a
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>dollar
functional currency. We believe our primary operations
constitute a QBU whose functional currency is the
U.S.&nbsp;dollar, but certain of our operations constitute
separate QBUs whose functional currencies are other than the
U.S.&nbsp;dollar.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Under recently proposed regulations (or the <I>Section&nbsp;987
Proposed Regulations</I>), the amount of foreign currency
translation gain or loss recognized upon a distribution of money
or property from a QBU or upon the sale of common units will
reflect the appreciation or depreciation in the functional
currency value of certain assets and liabilities of the QBU
between the time the unitholder purchased his common units and
the time we receive distributions from such QBU or the
unitholder sells his common units. Foreign currency translation
gain or loss will be treated as ordinary income or loss. A
unitholder must adjust the U.S.&nbsp;federal income tax basis in
his common units to reflect such income or loss prior to
determining any other U.S.&nbsp;federal income tax consequences
of such distribution or sale. Please read
&#147;&#151;&nbsp;Consequences of Unit Ownership&nbsp;&#151;
Basis of Common Units.&#148; A unitholder who owns less than a
five percent interest in our capital or profits generally may
elect not to have these rules apply by attaching a statement to
his tax return for the first taxable year the unitholder intends
the election to be effective. Further, for purposes of computing
his taxable income and U.S.&nbsp;federal income tax basis in his
common units, a unitholder will be required to translate into
his own functional currency items of income, gain, loss or
deduction of such QBU and his share of such QBU&#146;s
liabilities. We intend to provide such information based on
generally applicable U.S.&nbsp;exchange rates as is necessary
for unitholders to comply with the requirements of the
Section&nbsp;987 Proposed Regulations as part of the
U.S.&nbsp;federal income tax information we will furnish
unitholders each year. Please read
&#147;&#151;&nbsp;Administrative Matters&nbsp;&#151; Information
Returns and Audit Procedures.&#148; However, a unitholder may be
entitled to make an election to apply an alternative exchange
rate with respect to the foreign currency translation of certain
items. Unitholders who desire to make such an election should
consult their own tax advisors.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Based upon our current projections of the capital invested in
and profits of the
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>dollar
QBUs, we believe that unitholders will be required to recognize
only a nominal amount of foreign currency
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
translation gain or loss each year and upon their sale of units.
Nonetheless, the rules for determining the amount of translation
gain or loss are not entirely clear at present as the
Section&nbsp;987 Proposed Regulations currently are not
effective. Please consult your own tax advisor for specific
advice regarding the application of the rules for recognizing
foreign currency translation gain or loss under your own
circumstances.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition to a unitholder&#146;s recognition of foreign
currency translation gain or loss, the U.S.&nbsp;dollar QBU will
engage in certain transactions denominated in the Euro, which
will give rise to a certain amount of foreign currency exchange
gain or loss each year. This foreign currency exchange gain or
loss will be treated as ordinary income or loss.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='166'></A>
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Administrative Matters</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Information Returns and Audit Procedures.</I></B> We
intend to furnish to each unitholder, within 90&nbsp;days after
the close of each calendar year, specific U.S.&nbsp;federal
income tax information, including a document in the form of IRS
Form&nbsp;1065, Schedule&nbsp;K-1, which sets forth his share of
our income, gain, loss, deductions and credits as computed for
U.S.&nbsp;federal income tax purposes for our preceding taxable
year. In preparing this information, which will not be reviewed
by counsel, we will take various accounting and reporting
positions, some of which have been mentioned earlier, to
determine his share of such income, gain, loss, deduction and
credit. We cannot assure you that those positions will yield a
result that conforms to the requirements of the Internal Revenue
Code, Treasury Regulations or administrative interpretations of
the IRS. Neither we nor Perkins Coie LLP can assure prospective
unitholders that the IRS will not successfully contend that
those positions are impermissible. Any challenge by the IRS
could negatively affect the value of the units.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We will be obligated to file U.S.&nbsp;federal income tax
information returns with the IRS for any year in which we earn
any U.S.&nbsp;source income or U.S.&nbsp;effectively connected
income. In the event we were obligated to file a
U.S.&nbsp;federal income tax information return but failed to do
so, unitholders would not be entitled to claim any deductions,
losses or credits for U.S.&nbsp;federal income tax purposes
relating to us. Consequently, we may file U.S.&nbsp;federal
income tax information returns for any given year. The IRS may
audit any such information returns that we file. Adjustments
resulting from an IRS audit of our return may require each
unitholder to adjust a prior year&#146;s tax liability, and may
result in an audit of his return. Any audit of a
unitholder&#146;s return could result in adjustments not related
to our returns as well as those related to our returns. Any IRS
audit relating to our items of income, gain, loss, deduction or
credit for years in which we are not required to file and do not
file a U.S.&nbsp;federal income tax information return would be
conducted at the partner-level, and each unitholder may be
subject to separate audit proceedings relating to such items.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For years in which we file or are required to file
U.S.&nbsp;federal income tax information returns, we will be
treated as a separate entity for purposes of any
U.S.&nbsp;federal income tax audits, as well as for purposes of
judicial review of administrative adjustments by the IRS and tax
settlement proceedings. For such years, the tax treatment of
partnership items of income, gain, loss, deduction and credit
will be determined in a partnership proceeding rather than in
separate proceedings with the partners. The Internal Revenue
Code requires that one partner be designated as the &#147;Tax
Matters Partner&#148; for these purposes. The partnership
agreement names Teekay GP L.L.C. as our Tax Matters Partner.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Tax Matters Partner will make some U.S.&nbsp;federal tax
elections on our behalf and on behalf of unitholders. In
addition, the Tax Matters Partner can extend the statute of
limitations for assessment of tax deficiencies against
unitholders for items reported in the information returns we
file. The Tax Matters Partner may bind a unitholder with less
than a 1% profits interest in us to a settlement with the IRS
with respect to these items unless that unitholder elects, by
filing a statement with the IRS, not to give that authority to
the Tax Matters Partner. The Tax Matters Partner may seek
judicial review, by which all the unitholders are bound, of a
final partnership administrative adjustment and, if the Tax
Matters Partner fails to seek judicial review, judicial review
may be sought by any unitholder having at least a 1% interest in
profits or by any group of unitholders having in the aggregate
at least a 5% interest in profits. However,
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
only one action for judicial review will go forward, and each
unitholder with an interest in the outcome may participate.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A unitholder must file a statement with the IRS identifying the
treatment of any item on his U.S.&nbsp;federal income tax return
that is not consistent with the treatment of the item on an
information return that we file. Intentional or negligent
disregard of this consistency requirement may subject a
unitholder to substantial penalties.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Special Reporting Requirements for Owners of
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Partnerships.</I></B>
A U.S.&nbsp;person who either contributes more than $100,000 to
us (when added to the value of any other property contributed to
us by such person or a related person during the previous
12&nbsp;months), or following a contribution owns, directly,
indirectly or by attribution from certain related persons, at
least a 10% interest in us, is required to file IRS
Form&nbsp;8865 with his U.S.&nbsp;federal income tax return for
the year of the contribution to report the contribution and
provide certain details about himself and certain related
persons, us and any persons that own a 10% or greater direct
interest in us. We will provide each unitholder with the
necessary information about us and those persons who own a 10%
or greater direct interest in us along with the
Schedule&nbsp;K-1 information described previously.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition to the foregoing, a U.S.&nbsp;person who directly
owns at least a 10% interest in us may be required to make
additional disclosures on IRS Form&nbsp;8865 in the event such
person acquires, disposes or has his interest in us
substantially increased or reduced. Further, a U.S.&nbsp;person
who directly, indirectly or by attribution from certain related
persons, owns at least a 10% interest in us may be required to
make additional disclosures on IRS Form&nbsp;8865 in the event
such person, when considered together with any other
U.S.&nbsp;persons who own at least a 10% interest in us, owns a
greater than 50% interest in us. For these purposes, an
&#147;interest&#148; in us generally is defined to include an
interest in our capital or profits or an interest in our
deductions or losses.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Significant penalties may apply for failing to satisfy IRS
Form&nbsp;8865 filing requirements and thus unitholders are
advised to contact their tax advisors to determine the
application of these filing requirements under their own
circumstances.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><I>Accuracy-related Penalties.</I></B> An additional tax
equal to 20% of the amount of any portion of an underpayment of
U.S.&nbsp;federal income tax attributable to one or more
specified causes, including negligence or disregard of rules or
regulations and substantial understatements of income tax, is
imposed by the Internal Revenue Code. No penalty will be
imposed, however, for any portion of an underpayment if it is
shown that there was a reasonable cause for that portion and
that the taxpayer acted in good faith regarding that portion.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A substantial understatement of income tax in any taxable year
exists if the amount of the understatement exceeds the greater
of 10% of the tax required to be shown on the return for the
taxable year or $5,000. The amount of any understatement subject
to penalty generally is reduced if any portion is attributable
to a position adopted on the return:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    (1)&nbsp;for which there is, or was, &#147;substantial
    authority&#148;;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    (2)&nbsp;as to which there is a reasonable basis and the
    pertinent facts of that position are disclosed on the return.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
More stringent rules, including additional penalties and
extended statutes of limitations, may apply as a result of our
participation in &#147;listed transactions&#148; or
&#147;reportable transactions with a significant tax avoidance
purpose.&#148; While we do not anticipate participating in such
transactions, if any item of income, gain, loss, deduction or
credit included in the distributive shares of unitholders for a
given year might result in an &#147;understatement&#148; of
income relating to such a transaction, we will disclose the
pertinent facts on a U.S.&nbsp;federal income tax information
return for such year. In such event, we also will make a
reasonable effort to furnish sufficient information for
unitholders to make adequate disclosure on their returns and to
take other actions as may be appropriate to permit unitholders
to avoid liability for penalties.
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='167'></A>
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Possible Classification as a Corporation</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If we fail to meet the Qualifying Income Exception described
previously with respect to our classification as a partnership
for U.S.&nbsp;federal income tax purposes, other than a failure
that is determined by the IRS to be inadvertent and that is
cured within a reasonable time after discovery, we will be
treated as a
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>corporation
for U.S.&nbsp;federal income tax purposes. If previously treated
as a partnership, our change in status would be deemed to have
been effected by our transfer of all of our assets, subject to
liabilities, to a newly formed
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>corporation,
in return for stock in that corporation, and then our
distribution of that stock to our unitholders and other owners
in liquidation of their interests in us. Unitholders that are
U.S.&nbsp;persons would be required to file IRS Form&nbsp;926 to
report these deemed transfers and any other transfers they made
to us while we were treated as a corporation and may be required
to recognize income or gain for U.S.&nbsp;federal income tax
purposes to the extent of certain prior deductions or losses and
other items. Substantial penalties may apply for failure to
satisfy these reporting requirements, unless the person
otherwise required to report shows such failure was due to
reasonable cause and not willful neglect.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If we were treated as a corporation in any taxable year, either
as a result of a failure to meet the Qualifying Income Exception
or otherwise, our items of income, gain, loss, deduction and
credit would not pass through to unitholders. Instead, we would
be subject to U.S.&nbsp;federal income tax based on the rules
applicable to foreign corporations, not partnerships, and such
items would be treated as our own. Any distribution made to a
unitholder would be treated as taxable dividend income to the
extent of our current or accumulated earnings and profits, a
nontaxable return of capital to the extent of the
unitholder&#146;s tax basis in his common units, and taxable
capital gain thereafter. Section&nbsp;743(b) adjustments to the
basis of our assets would no longer be available to purchasers
in the marketplace. Please read &#147;&#151;&nbsp;Consequences
of Unit Ownership&nbsp;&#151; Section&nbsp;754 Election.&#148;
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Taxation of Operating Income</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In the event we were treated as a corporation, our operating
income may be subject to U.S.&nbsp;federal income taxation under
one of two alternative tax regimes (the 4% gross basis tax or
the net basis tax, as described below).
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>The 4% Gross Basis Tax</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We may be subject to a 4% U.S.&nbsp;federal income tax on the
U.S.&nbsp;source portion of our gross income (without benefit of
deductions) attributable to transportation that begins or ends
(but not both) in the United States, unless the Section&nbsp;883
Exemption applies (as more fully described below under
&#147;&#151;&nbsp;The Section&nbsp;883 Exemption&#148;) and we
file a U.S.&nbsp;federal income tax return to claim that
exemption. For this purpose, gross income attributable to
transportation (or <I>transportation income</I>) includes income
from the use, hiring or leasing of a vessel to transport cargo,
or the performance of services directly related to the use of
any vessel to transport cargo, and thus includes time charter or
bareboat charter income. The U.S.&nbsp;source portion of our
transportation income is deemed to be 50% of the income
attributable to voyages that begin or end (but not both) in the
United States. Generally, no amount of the income from voyages
that begin and end outside the United States is treated as
U.S.&nbsp;source, and consequently none of the transportation
income attributable to such voyages is subject to
U.S.&nbsp;federal income tax. Although the entire amount of
transportation income from voyages that begin and end in the
United States would be fully taxable in the United States, we
currently do not expect to have any transportation income from
voyages that begin and end in the United States; however, there
is no assurance that such voyages will not occur.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Net Income Tax and Branch Tax Regime</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We currently do not expect to have a fixed place of business in
the United States. Nonetheless, if this were to change or we
otherwise were treated as having such a fixed place of business
involved in earning U.S.&nbsp;source transportation income, such
transportation income may be treated as U.S. effectively
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
connected income. Any income that we earn that is treated as
U.S.&nbsp;effectively connected income would be subject to
U.S.&nbsp;federal corporate income tax (the highest statutory
rate is currently 35%), unless the Section&nbsp;883 Exemption
(as discussed below) applied. The 4% U.S.&nbsp;federal income
tax described above is inapplicable to U.S.&nbsp;effectively
connected income.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Unless the Section&nbsp;883 Exemption applied, a 30% branch
profits tax imposed under Section&nbsp;884 of the Internal
Revenue Code also would apply to our earnings that result from
U.S.&nbsp;effectively connected income, and a branch interest
tax could be imposed on certain interest paid or deemed paid by
us. Furthermore, on the sale of a vessel that has produced
U.S.&nbsp;effectively connected income, we could be subject to
the net basis corporate income tax and to the 30% branch profits
tax with respect to our gain not in excess of certain prior
deductions for depreciation that reduced U.S.&nbsp;effectively
connected income. Otherwise, we would not be subject to
U.S.&nbsp;federal income tax with respect to gain realized on
sale of a vessel because it is expected that any sale of a
vessel will be structured so that it is considered to occur
outside of the United States and so that it is not attributable
to an office or other fixed place of business in the United
States.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>The Section&nbsp;883 Exemption</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In general, if a
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>corporation
satisfies the requirements of Section&nbsp;883 of the Internal
Revenue Code and the regulations thereunder (or the Final
Section&nbsp;883 Regulations), it will not be subject to the 4%
gross basis tax or the net basis tax described above on its
U.S.&nbsp;source transportation income attributable to voyages
that begin or end (but not both) in the United States (or
<I>U.S.&nbsp;Source International Shipping Income</I>).
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>corporation
will qualify for the Section&nbsp;883 Exemption if, among other
things, it is organized in a jurisdiction outside the United
States that grants an equivalent exemption from tax to
corporations organized in the United States (or an <I>Equivalent
Exemption</I>), it meets one of three tests described below:
(1)&nbsp;the more than 50% ownership test (or the <I>Ownership
Test</I>); (2)&nbsp;the <I>&#147;Publicly Traded Test&#148;</I>;
or (3)&nbsp;the controlled foreign corporation test (or the
<I>CFC Test</I>)&nbsp;&#151; and certain substantiation,
reporting and other requirements are met.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In order to satisfy the Ownership Test, a
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>corporation
must be able to substantiate that more than 50% of the value of
its stock is owned, directly or indirectly applying attribution
rules, by &#147;qualified shareholders&#148; for at least half
of the number of days in the
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>corporation&#146;s
taxable year, and the
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>corporation
must comply with certain substantiation and reporting
requirements. For this purpose, qualified shareholders are
individuals who are residents (as defined for U.S.&nbsp;federal
income tax purposes) of countries that grant an Equivalent
Exemption,
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>corporations
that meet the Publicly Traded Test of the Final Section&nbsp;883
Regulations and are organized in countries that grant an
Equivalent Exemption, or certain foreign governments, non profit
organizations and certain beneficiaries of foreign pension
funds. Unitholders who are citizens or residents of the United
States or are domestic corporations are not qualified
shareholders.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, a corporation claiming the Section&nbsp;883
Exemption based on the Ownership Test must obtain statements
from the holders relied upon to satisfy the Ownership Test,
signed under penalty of perjury, including the owner&#146;s
name, permanent address and country where the individual is
fully liable to tax, if any, a description of the owner&#146;s
ownership interest in the
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>corporation,
including information regarding ownership in any intermediate
entities, and certain other information. In addition, we would
be required to file a U.S.&nbsp;federal income tax return and
list on our U.S.&nbsp;federal income tax return the name and
address of each unitholder holding 5% or more of the value of
our units who is relied upon to meet the Ownership Test.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Publicly Traded Test requires that one or more classes of
equity representing more than 50% of the voting power and value
in a
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>corporation
be &#147;primarily and regularly traded&#148; on an established
securities market either in the U.S.&nbsp;or in a foreign
country that grants an Equivalent Exemption. For this purpose,
if one or more 5% shareholders (i.e., a shareholder holding,
actually or constructively, at least 5% of the vote and value of
a class of equity) own in the aggregate 50% or more of the vote
and value of a
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
class of equity, such class of equity will not be treated as
primarily and regularly traded on an established securities
market.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The CFC Test requires that the
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>corporation
be treated as a controlled foreign corporation for
U.S.&nbsp;federal income tax purposes and a qualified U.S.
person ownership test is met (for the definition of
&#147;controlled foreign corporation&#148; please read the
discussion below under &#147;&#151;&nbsp;Consequences of
Possible Controlled Foreign Corporation Classification&#148;).
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are organized under the laws of the Republic of The Marshall
Islands. The U.S.&nbsp;Treasury Department has recognized the
Republic of The Marshall Islands as a jurisdiction that grants
an Equivalent Exemption. Consequently, in the event we were
treated as a corporation for U.S.&nbsp;federal income tax
purposes, our U.S.&nbsp;Source International Shipping Income
(including for this purpose, any such income earned by our
subsidiaries that have properly elected to be treated as
partnerships or disregarded as entities separate from us for
U.S.&nbsp;federal income tax purposes), would be exempt from
U.S.&nbsp;federal income taxation provided we meet the Ownership
Test or we satisfy either the CFC Test or the Publicly Traded
Test. We do not believe that we will meet the CFC Test, as we do
not expect to be a CFC (please read below under
&#147;&#151;&nbsp;Consequences of Possible Controlled Foreign
Corporation Classification&#148;), and while not completely
clear, we may not meet the Publicly Traded Test due to Teekay
Shipping Corporation&#146;s substantial indirect ownership of
us. Nonetheless, as of the date of this prospectus, we believe
that we should satisfy the Ownership Test based upon the
ownership immediately after the offering of more than 50% of the
value of us by Teekay Shipping Corporation.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Based on information provided by Teekay Shipping Corporation,
Teekay Shipping Corporation is organized in the Republic of The
Marshall Islands and meets the Publicly Traded Test under
current law and under the Final Section&nbsp;883 Regulations. As
long as Teekay Shipping Corporation owns more than 50% of the
value of us and satisfies the Publicly Traded Test, we will
satisfy the Ownership Test and will qualify for the
Section&nbsp;883 Exemption, provided that Teekay Shipping
Corporation provides properly completed ownership statements to
us as required under the Final Section&nbsp;883 Regulations and
we satisfy certain substantiation and documentation
requirements. As of the date hereof, Teekay Shipping Corporation
would be willing to provide us with such ownership statements as
long as it is a qualifying shareholder. There is no assurance
that Teekay Shipping Corporation will continue to satisfy the
requirements for being a qualified shareholder of us (i.e., it
will meet the Publicly Traded Test) or that it alone will own
more than 50% of the value of our units. At some time in the
future, it may become necessary for us to look to our other
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>unitholders
to determine whether more than 50% of our units, by value, are
owned by
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>unitholders
who are qualifying shareholders and certain
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>unitholders
may be asked to provide ownership statements, signed under
penalty of perjury, with respect to their investment in our
units in order for us to qualify for the Section&nbsp;883
Exemption. If we cannot obtain these statements from unitholders
holding, in the aggregate, more than 50% of the value of our
units, under the Final Section&nbsp;883 Regulations, we may not
be eligible to claim the Section&nbsp;883 Exemption, and,
therefore, we would be required to pay a 4% tax on the gross
amount of our U.S.&nbsp;Source International Shipping Income,
thereby reducing the amount of cash available for distribution
to unitholders.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The determination of whether we will satisfy the Ownership Test
at any given time depends upon a multitude of factors, including
Teekay Shipping Corporation&#146;s ownership of us, whether
Teekay Shipping Corporation&#146;s stock is publicly traded, the
concentration of ownership of Teekay Shipping Corporation&#146;s
own stock and the satisfaction of various substantiation and
documentation requirements. There can be no assurance that we
will satisfy these requirements at any given time and thus that
our U.S.&nbsp;Source International Shipping Income would be
exempt from U.S.&nbsp;federal income taxation by reason of
Section&nbsp;883 in any of our taxable years if we were treated
as a corporation.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Consequences of Possible PFIC Classification</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A non-United States entity treated as a corporation for
U.S.&nbsp;federal income tax purposes will be a PFIC in any
taxable year in which, after taking into account the income and
assets of the corporation and
</DIV>

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
certain subsidiaries pursuant to a &#147;look through&#148;
rule, either (1)&nbsp;at least 75% of its gross income is
&#147;passive&#148; income (or the <I>income test</I>) or
(2)&nbsp;at least 50% of the average value of its assets is
attributable to assets that produce passive income or are held
for the production of passive income (or the <I>assets test</I>).
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Based upon our current assets and operations, we do not believe
that we would be considered to be a PFIC even if we were treated
as a corporation. However, legal uncertainties are involved and,
in addition, there is no assurance that the nature of our
assets, income and operations will remain the same in the
future. We are not relying on an opinion of counsel on this
issue. There is a meaningful risk that the IRS would consider us
to be a PFIC, and no assurance can be given that we would not
become a PFIC in the future, in the event we were treated as a
corporation for U.S.&nbsp;federal income tax purposes.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If we were classified as a PFIC, for any year during which a
unitholder owns units, he generally will be subject to special
rules (regardless of whether we continue thereafter to be a
PFIC) with respect to (1)&nbsp;any &#147;excess
distribution&#148; (generally, any distribution received by a
unitholder in a taxable year that is greater than 125% of the
average annual distributions received by the unitholder in the
three preceding taxable years or, if shorter, the
unitholder&#146;s holding period for the units) and (2)&nbsp;any
gain realized upon the sale or other disposition of units. Under
these rules:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the excess distribution or gain will be allocated ratably over
    the unitholder&#146;s holding period;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the amount allocated to the current taxable year and any year
    prior to the first year in which we were a PFIC will be taxed as
    ordinary income in the current year;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the amount allocated to each of the other taxable years in the
    unitholder&#146;s holding period will be subject to
    U.S.&nbsp;federal income tax at the highest rate in effect for
    the applicable class of taxpayer for that year;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    an interest charge for the deemed deferral benefit will be
    imposed with respect to the resulting tax attributable to each
    of these other taxable years.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Certain elections, such as a qualified electing fund (or
<I>QEF</I>) election or mark to market election, may be
available to a unitholder if we were classified as a PFIC. If we
determine that we are or will be a PFIC, we will provide
unitholders with information concerning the potential
availability of such elections.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Under current law, dividends received by individual citizens or
residents of the United States from domestic corporations and
qualified foreign corporations generally are treated as net
capital gains and subject to U.S.&nbsp;federal income tax at
reduced rates (generally 15%). However, if we were classified as
a PFIC for our taxable year in which we pay a dividend, we would
not be considered a qualified foreign corporation, and
individuals receiving such dividends would not be eligible for
the reduced rate of U.S.&nbsp;federal income tax.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Consequences of Possible Controlled Foreign Corporation
    Classification</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If more than 50% of either the total combined voting power of
our outstanding units entitled to vote or the total value of all
of our outstanding units were owned, actually or constructively,
by citizens or residents of the United States,
U.S.&nbsp;partnerships or corporations, or U.S.&nbsp;estates or
trusts (as defined for U.S.&nbsp;federal income tax purposes),
each of which owned, actually or constructively, 10% or more of
the total combined voting power of our outstanding units
entitled to vote (each, a <I>U.S.&nbsp;Shareholder</I>), we
could be treated as a controlled foreign corporation (or
<I>CFC</I>) at any such time as we are properly classified as a
corporation for U.S.&nbsp;federal income tax purposes.
U.S.&nbsp;Shareholders of a CFC are treated as receiving current
distributions of their shares of certain income of the CFC (not
including, under current law, certain undistributed earnings
attributable to shipping income) without regard to any actual
distributions and are subject to other burdensome
U.S.&nbsp;federal income tax and administrative requirements but
generally are not also subject to the requirements generally
applicable to owners of a PFIC. Although we do not believe we
will be a CFC following the Offering, U.S.&nbsp;persons
purchasing a substantial interest in us should consider the
potential implications of being treated as a
U.S.&nbsp;Shareholder in the event we were a CFC in the future.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">74

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='168'></A>
</DIV>

<!-- link1 "Tax Consequences of Ownership of Debt Securities" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Tax Consequences of Ownership of Debt Securities</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A description of the material federal income tax consequences of
the acquisition, ownership and disposition of debt securities
will be set forth in the prospectus supplement relating to the
offering of any debt securities.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='169'></A>
</DIV>

<!-- link1 "NON-UNITED STATES TAX CONSEQUENCES" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NON-UNITED STATES TAX CONSEQUENCES</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='170'></A>
</DIV>

<!-- link1 "Marshall Islands Tax Consequences" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Marshall Islands Tax Consequences</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following discussion is based upon the opinion of Watson,
Farley&nbsp;&#38; Williams (New York) LLP, our counsel as to
matters of the laws of the Republic of The Marshall Islands,
regarding the material Marshall Islands tax consequences of our
activities to holders of our common units who do not reside in,
maintain offices in or engage in business in the Marshall
Islands.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Because we and our subsidiaries do not, and we do not expect
that we and our subsidiaries will, conduct business or
operations in the Marshall Islands, and because all
documentation related to this offering will be executed outside
of the Marshall Islands, under current Marshall Islands law
holders of our common units will not be subject to Marshall
Islands taxation or withholding on distributions, including upon
a return of capital, we make to our unitholders. In addition,
our unitholders will not be subject to Marshall Islands stamp,
capital gains or other taxes on the purchase, ownership or
disposition of common units, and they will not be required by
the Republic of The Marshall Islands to file a tax return
relating to the common units.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
It is the responsibility of each unitholder to investigate the
legal and tax consequences, under the laws of pertinent
jurisdictions, including the Marshall Islands, of his investment
in us. Accordingly, each prospective unitholder is urged to
consult, and depend upon, his tax counsel or other advisor with
regard to those matters. Further, it is the responsibility of
each unitholder to file all state, local and
<FONT style="white-space: nowrap">non-U.S.,</FONT> as well as
U.S.&nbsp;federal tax returns, that may be required of him.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='171'></A>
</DIV>

<!-- link1 "Canadian Federal Income Tax Consequences" -->

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Canadian Federal Income Tax Consequences</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following discussion is a summary of the material Canadian
federal income tax consequences under the Income Tax Act
(Canada) (or the <I>Canada Tax Act</I>), as of the date of this
prospectus, that we believe are relevant to holders of our
common units who are, at all relevant times, for the purposes of
the Canada Tax Act and the Canada-United States Tax Convention
1980 (or the <I>Canada-U.S.&nbsp;Treaty</I>) resident in the
United States and who deal at arm&#146;s length with us and
Teekay Shipping Corporation (or <I>U.S.&nbsp;Resident
Holders</I>).
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Under the Canada Tax Act, no taxes on income (including taxable
capital gains) are payable by U.S.&nbsp;Resident Holders in
respect of the acquisition, holding, disposition or redemption
of the common units, provided that we do not carry on business
in Canada and such U.S.&nbsp;Resident Holders do not, for the
purposes of the Canada-U.S.&nbsp;Treaty, otherwise have a
permanent establishment or fixed base in Canada to which such
common units pertain and, in addition, do not use or hold and
are not deemed or considered to use or hold such common units in
the course of carrying on a business in Canada and, in the case
of any U.S.&nbsp;Resident Holders that carry on an insurance
business in Canada and elsewhere, such U.S.&nbsp;Resident
Holders establish that the common units are not effectively
connected with their insurance business carried on in Canada.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In this connection, we believe that our activities and affairs
can be conducted in a manner that we will not be carrying on
business in Canada and that U.S.&nbsp;Resident Holders should
not be considered to be carrying on business in Canada for
purposes of the Canada Tax Act solely by reason of the
acquisition, holding, disposition or redemption of their common
units. We intend that this is and continues to be the case,
notwithstanding that certain services will be provided to Teekay
LNG Partners L.P., indirectly through arrangements with Teekay
Shipping Limited (a subsidiary of Teekay Shipping Corporation
that is resident and based in the Bahamas), by Canadian service
providers, as discussed below.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">75

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Under the Canada Tax Act, a resident of Canada (which may
include a foreign corporation the central management and control
of which is in Canada) is subject to Canadian tax on its
world-wide income, subject to any relief that may be provided by
any relevant tax treaty. A non-resident corporation or
individual that carries on a business in Canada directly or
through a partnership is, subject to any relevant tax treaty,
subject to tax in Canada on income attributable to its business
(or that of the partnership&#146;s, as the case may be) carried
on in Canada. The Canada Tax Act contains special rules that
provide assurance to qualifying international shipping
corporations that they will not be considered resident in Canada
even if they are, in whole or in part, managed from Canada.
Further, the Canada Tax Act and many of the tax treaties to
which Canada is a party also contain special exemptions for
profits derived from international shipping operations.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have entered into an agreement with Teekay Shipping Limited
for the provision of administrative services, and certain of our
operating subsidiaries have entered into agreements with:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Teekay Shipping Limited for the provision of advisory,
    technical, ship management and administrative services;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Teekay LNG Projects Ltd., a Canadian subsidiary of Teekay
    Shipping Corporation, for the provision of strategic advisory
    and consulting services.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Certain of the services that Teekay Shipping Limited provides to
us and our operating subsidiaries under the services agreements
are and will be obtained by Teekay Shipping Limited through
subcontracts with a Canadian subsidiary of Teekay Shipping
Corporation. The special rules in the Canada Tax Act and various
relevant tax treaties relating to qualifying international
shipping corporations and income from international shipping
operations may provide relief to our operating subsidiaries to
the extent that the services provided to them by Canadian
entities would otherwise result in such operating subsidiaries
being considered to be resident in Canada or to be taxable in
Canada on income from such operations by virtue of carrying on
business in Canada. However, such rules would not apply to us,
as a holding limited partnership, or to our general partner or
unitholders. While we do not believe it to be the case, if the
arrangements we have entered into result in our being considered
to carry on business in Canada for purposes of the Canada Tax
Act, our unitholders would be considered to be carrying on
business in Canada and would be required to file Canadian tax
returns and, subject to any relief provided in any relevant
treaty (including, in the case of U.S.&nbsp;Resident Holders,
the Canada-U.S.&nbsp;treaty), would be subject to taxation in
Canada on any income that is considered to be attributable to
the business carried on by us in Canada.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We believe that we can conduct our activities and affairs in a
manner so that our unitholders should not be considered to be
carrying on business in Canada solely as a consequence of the
acquisition, holding, disposition or redemption of our common
units. Consequently, we believe our unitholders should not be
subject to tax filing or other tax obligations in Canada under
the Canada Tax Act. However, although we do not intend to do so,
there can be no assurance that the manner in which we carry on
our activities will not change from time to time as
circumstances dictate or warrant in a manner that may cause our
unitholders to be carrying on business in Canada for purposes of
the Canada Tax Act. Further, the relevant Canadian federal
income tax law may change by legislation or judicial
interpretation and the Canadian taxing authorities may take a
different view than we have of the current law.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
It is the responsibility of each unitholder to investigate the
legal and tax consequences, under the laws of pertinent
jurisdictions, including Canada, of an investment in us.
Accordingly, each prospective unitholder is urged to consult,
and depend upon, the unitholder&#146;s tax counsel or other
advisor with regard to those matters. Further, it is the
responsibility of each unitholder to file all state, local and
<FONT style="white-space: nowrap">non-U.S.,</FONT> as well as
U.S.&nbsp;federal tax returns, that may be required of the
unitholder.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">76

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='172'></A>
</DIV>

<!-- link1 "PLAN OF DISTRIBUTION" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>PLAN OF DISTRIBUTION</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We may sell the securities offered by this prospectus and
applicable prospectus supplements:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    through underwriters or dealers;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    through agents;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    directly to purchasers;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    through a combination of any such methods of sale.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If underwriters are used to sell securities, we will enter into
an underwriting agreement or similar agreement with them at the
time of the sale to them. In that connection, underwriters may
receive compensation from us in the form of underwriting
discounts or commissions and may also receive commissions from
purchasers of the securities for whom they may act as agent. Any
such underwriter, dealer or agent may be deemed to be an
underwriter within the meaning of the U.S.&nbsp;Securities Act
of 1933.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The applicable prospectus supplement relating to the securities
will set forth, among other things:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the offering terms, including the name or names of any
    underwriters, dealers or agents;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the purchase price of the securities and the proceeds to us from
    such sale;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    any underwriting discounts, concessions, commissions and other
    items constituting compensation to underwriters, dealers or
    agents;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    any initial public offering price;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    any discounts or concessions allowed or reallowed or paid by
    underwriters or dealers to other dealers;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    in the case of debt securities, the interest rate, maturity and
    any redemption provisions;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    in the case of debt securities that are convertible into or
    exchangeable for other securities, the conversion or exchange
    rate and other terms, conditions and features;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    any securities exchanges on which the securities may be listed.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If underwriters or dealers are used in the sale, the securities
will be acquired by the underwriters or dealers for their own
account and may be resold from time to time in one or more
transactions in accordance with the rules of the New York Stock
Exchange:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    at a fixed price or prices that may be changed;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    at market prices prevailing at the time of sale;</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    at prices related to such prevailing market prices;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6.0pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    at negotiated prices.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The securities may be offered to the public either through
underwriting syndicates represented by one or more managing
underwriters or directly by one or more of such firms. Unless
otherwise set forth in an applicable prospectus supplement, the
obligations of underwriters or dealers to purchase the
securities will be subject to certain conditions precedent and
the underwriters or dealers will be obligated to purchase all
the securities if any are purchased. Any public offering price
and any discounts or concessions allowed or reallowed or paid by
underwriters or dealers to other dealers may be changed from
time to time.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Securities may be sold directly by us or through agents
designated by us from time to time. Any agent involved in the
offer or sale of the securities in respect of which this
prospectus and a prospectus supplement is delivered will be
named, and any commissions payable by us to such agent will be
set forth, in the prospectus supplement. Unless otherwise
indicated in the prospectus supplement, any such agent will be
acting on a best efforts basis for the period of its appointment.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">77

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<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If so indicated in the prospectus supplement, we will authorize
underwriters, dealers or agents to solicit offers from certain
specified institutions to purchase securities from us at the
public offering price set forth in the prospectus supplement
pursuant to delayed delivery contracts providing for payment and
delivery on a specified date in the future. Such contracts will
be subject to any conditions set forth in the prospectus
supplement and the prospectus supplement will set forth the
commissions payable for solicitation of such contracts. The
underwriters and other persons soliciting such contracts will
have no responsibility for the validity or performance of any
such contracts.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Underwriters, dealers and agents may be entitled under
agreements entered into with us to be indemnified by us against
certain civil liabilities, including liabilities under the
U.S.&nbsp;Securities Act of 1933, or to contribution by us to
payments which they may be required to make. The terms and
conditions of such indemnification will be described in an
applicable prospectus supplement.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Underwriters, dealers and agents may be customers of, engage in
transactions with, or perform services for us or our affiliates
in the ordinary course of business.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Any underwriters to whom securities are sold by us for public
offering and sale may make a market in such securities, but such
underwriters will not be obligated to do so and may discontinue
any market making at any time without notice. No assurance can
be given as to the liquidity of the trading market for any
securities.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Certain persons participating in any offering of securities may
engage in transactions that stabilize, maintain or otherwise
affect the price of the securities offered. In connection with
any such offering, the underwriters or agents, as the case may
be, may purchase and sell securities in the open market. These
transactions may include over-allotment and stabilizing
transactions and purchases to cover syndicate short positions
created in connection with the offering. Stabilizing
transactions consist of certain bids or purchases for the
purpose of preventing or retarding a decline in the market price
of the securities and syndicate short positions involve the sale
by the underwriters or agents, as the case may be, of a greater
number of securities than they are required to purchase from us
in the offering. The underwriters may also impose a penalty bid,
whereby selling concessions allowed to syndicate members or
other broker-dealers for the securities sold for their account
may be reclaimed by the syndicate if such securities are
repurchased by the syndicate in stabilizing or covering
transactions. These activities may stabilize, maintain or
otherwise affect the market price of the securities, which may
be higher than the price that might otherwise prevail in the
open market, and if commenced, may be discontinued at any time.
These transactions may be effected on the New York Stock
Exchange, in the
<FONT style="white-space: nowrap">over-the</FONT>-counter market
or otherwise. These activities will be described in more detail
in the applicable prospectus supplement.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">78

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='173'></A>
</DIV>

<!-- link1 "SERVICE OF PROCESS AND ENFORCEMENT OF CIVIL LIABILITIES" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>SERVICE OF PROCESS AND ENFORCEMENT OF CIVIL LIABILITIES</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Teekay LNG Partners L.P. is organized under the laws of the
Marshall Islands as a limited partnership. Our general partner
is organized under the laws of the Marshall Islands as a limited
liability company. The Marshall Islands has a less developed
body of securities laws as compared to the United States and
provides protections for investors to a significantly lesser
extent. Teekay LNG Finance Corp. and some of the Subsidiary
Guarantors are also incorporated or organized under the laws of
the Marshall Islands. Other Subsidiary Guarantors are organized
under the laws of Spain and Luxembourg.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Most of the directors and officers of our general partner and
those of our subsidiaries are residents of countries other than
the United States. Substantially all of our and our
subsidiaries&#146; assets and a substantial portion of the
assets of the directors and officers of our general partner are
located outside the United States. As a result, it may be
difficult or impossible for United States investors to effect
service of process within the United States upon us, our general
partner, our subsidiaries or the directors and officers of our
general partner or to realize against us or them judgments
obtained in United States courts, including judgments predicated
upon the civil liability provisions of the securities laws of
the United States or any state in the United States. However,
we, Teekay LNG Finance Corp. and the Subsidiary Guarantors have
expressly submitted to the jurisdiction of the U.S.&nbsp;federal
and New York state courts sitting in the City of New York for
the purpose of any suit, action or proceeding arising under the
securities laws of the United States or any state in the United
States, and we have appointed Watson, Farley&nbsp;&#38; Williams
(New York) LLP to accept service of process on our behalf in any
such action.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Watson, Farley&nbsp;&#38; Williams (New York) LLP, our counsel
as to Marshall Islands law, Noble&nbsp;&#38; Schneidecker, our
counsel as to Luxembourg law and Ur&#237;a, Men&#233;ndez y
CIA., Abogados, S.C., our counsel as to Spanish law, have
advised us that there is uncertainty as to whether the courts of
the Marshall Islands, Luxembourg and Spain, respectively, would
(1)&nbsp;recognize or enforce against us, our general partner,
Teekay LNG Finance Corp., the Subsidiary Guarantors or the
directors, officers, managers or partners of such entities
judgments of courts of the United States based on civil
liability provisions of applicable U.S.&nbsp;federal and state
securities laws or (2)&nbsp;impose liabilities against us, such
other entities or the directors, officers, managers or partners
of such entities in original actions brought in the Marshall
Islands, Luxembourg or Spain based on these respective laws.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='174'></A>
</DIV>

<!-- link1 "LEGAL" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>LEGAL</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Unless otherwise stated in the applicable prospectus supplement,
(a)&nbsp;the validity of the securities and certain other legal
matters with respect to the laws of The Republic of the Marshall
Islands will be passed upon for us by our counsel as to Marshall
Islands law, Watson, Farley&nbsp;&#38; Williams (New York) LLP,
(b)&nbsp;the validity of the debt securities under New York law
and certain other legal matters will be passed upon for us by
Perkins Coie LLP, which may rely on the opinions of Watson,
Farley&nbsp;&#38; Williams (New York) LLP for all matters of
Marshall Islands law, (c)&nbsp;the validity of the guarantee of
Teekay Luxembourg S.a.r.l. under Luxembourg law will be passed
upon for us by Noble&nbsp;&#38; Schneidecker and (d)&nbsp;the
validity of guarantees of certain other Subsidiary Guarantors
under the laws of Spain will be passed upon for us by Ur&#237;a,
Men&#233;ndez y CIA., Abogados, S.C. Any underwriter will be
advised about other issues relating to any offering by its own
legal counsel.
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='175'></A>
</DIV>

<!-- link1 "EXPERTS" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>EXPERTS</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The financial statements incorporated in this prospectus by
reference to Teekay LNG Partners&#146; Annual Report on
Form&nbsp;<FONT style="white-space: nowrap">20-F</FONT> for the
year ended December&nbsp;31, 2005 have been so incorporated in
reliance on the report of Ernst&nbsp;&#38; Young LLP, an
independent registered public accounting firm, given on the
authority of such firm as experts in auditing and accounting.
You may contact Ernst&nbsp;&#38; Young LLP at 700&nbsp;West
Georgia Street, Vancouver, British Columbia, V7Y 1C7, Canada.
</DIV>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">79
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff;">
<A name='176'></A>
</DIV>

<!-- link1 "EXPENSES" -->

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>EXPENSES</B>
</DIV>

<DIV align="left" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table sets forth costs and expenses, other than
any underwriting discounts and commissions, we expect to incur
in connection with the issuance and distribution of the
securities covered by this prospectus. All amounts are estimated
except the SEC registration fee.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10.0pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="83%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    U.S.&nbsp;Securities and Exchange Commission registration fee</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>42,800</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    NASD filing fee</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>*</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Rating agency fees</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>*</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Legal fees and expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>*</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accounting fees and expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>*</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Printing costs</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>*</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Transfer agent fees</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>*</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Trustee fees</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>*</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 3.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10.0pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="2%"></TD>
    <TD width="98%"></TD>
</TR>

<TR valign="top">
    <TD>*&nbsp;</TD>
    <TD align="left">
    To be provided in a prospectus supplement or in a Report on
    Form&nbsp;<FONT style="white-space: nowrap">6-K</FONT>
    subsequently incorporated by reference into this prospectus.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff;">80

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="center" style="font-size: 2.0pt;color: #000000; background: #ffffff;">
<DIV style="width: 100%; border-top: 2.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="center" style="font-size: 3.0pt;color: #000000; background: #ffffff;">
<DIV style="width: 100%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="center" style="font-size: 10.0pt;color: #000000; background: #ffffff; margin-top: 14pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<IMG src="o36113xo3611300.gif" alt="(TEEKAY LNG PARTNERS L.P. LOGO)">
</DIV>

<DIV align="center" style="font-size: 24.0pt;color: #000000; background: #ffffff; margin-top: 30pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Teekay LNG Partners L.P.</B>
</DIV>

<DIV align="center" style="font-size: 18.0pt;color: #000000; background: #ffffff; margin-top: 15pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>2,300,000 Common Units</B>
</DIV>

<DIV align="center" style="font-size: 18.0pt;color: #000000; background: #ffffff;">
<B>Representing Limited Partner Interests</B>
</DIV>

<DIV align="center" style="font-size: 3.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 22%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="center" style="font-size: 12.0pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>PROSPECTUS SUPPLEMENT</B>
</DIV>

<DIV align="center" style="font-size: 12.0pt;color: #000000; background: #ffffff; margin-top: 10pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>May&nbsp;15, 2007</B>
</DIV>

<DIV align="center" style="font-size: 3.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 22%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="center" style="font-size: 12.0pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B><I>Sole Book-Running Manager</I></B>
</DIV>

<DIV align="center" style="font-size: 18.0pt;color: #000000; background: #ffffff;">
<B>Wachovia Securities</B>
</DIV>

<DIV align="center" style="font-size: 3.0pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 22%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="center" style="font-size: 18.0pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Citi</B>
</DIV>

<DIV align="center" style="font-size: 18.0pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Raymond James</B>
</DIV>

<DIV align="center" style="font-size: 3.0pt;color: #000000; background: #ffffff; margin-top: 30pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 100%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="center" style="font-size: 4.0pt;color: #000000; background: #ffffff;">
<DIV style="width: 100%; border-top: 2.0pt solid black; font-size: 1pt">&nbsp;</DIV>
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MY<9Z!CJ\96X[?/RCQA;FRK>U$I:L-$TKOS7+ZG%,:3CKY2I=E\J]N;*50/OC
1'S/W2RNH,IE`Z^7+-A8$`#L_
`
end
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
