Altera Infrastructure · 2020. 9. 9. · Altera Infrastructure in a brief 4 (1) As of June 30, 2020. Based on existing contracts; but excluding extension options and oil-tariff revenue

Altera Infrastructure

JP Morgan High Yield Conference – September, 2020

1

This release contains forward-looking statements (as defined in Section 21E of the Securities Exchange Act of 1934,

as amended) which reflect management’s current views with respect to certain future events and performance,

including, among others, the timing of the commencement of charter contracts. The following factors are among those

that could cause actual results to differ materially from the forward-looking statements, which involve risks and

uncertainties, and that should be considered in evaluating any such statement: delays in the commencement of charter

contracts; unanticipated market volatility (such as volatility resulting from the recent COVID-19 outbreak); and other

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

fiscal year ended December 31, 2019. The Partnership expressly disclaims any obligation or undertaking to release

publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the

Partnership’s expectations with respect thereto or any change in events, conditions or circumstances on which any

such statement is based.

Forward Looking Statement

2

Altera Infrastructure’s key credit highlights

3

Provider of Critical Infrastructure Services for Offshore Production1

Leading Market Positions With Barriers to Entry3

Contracted Cash Flow Profile with History of Stability4

Blue-Chip, High Credit Quality Customer Base5

World Class Operations2

Strong Sponsor and Broad Access to Capital6

Altera Infrastructure in a brief

(1) As of June 30, 2020. Based on existing contracts; but excluding extension options and oil-tarif f revenue.4

3%

48%

49%

FSO Shuttle Tanker FPSO

$4.4bn(1)Forward Revenue

~2,000Employees

53

Vessels

Blue-Chip Customers

Portfolio Focused on Midstream Assets

1) Including new builds and chartered-in vessels

2) Petrojarl Varg currently in lay-up5

Stable

Contracted

30(1) vessels

Stable

Contracted(2)

7 owned plus 3 managed

Stable

Contracted

5 vessels

Shuttle Tankers

• Unique value proposition

• Critical infrastructure to deliver North Sea, East

Coast Canada and Brazilian oil production

Pipelines

FPSOs

• Strong performer on cost,

capabilities and HSEQ

• High switching cost creates

effective barrier to entry

Gathering & Processing

FSOs

Terminals / Storage TanksSimilar to

Midstream Category

Business

Characteristics

▲ Multi-field exposure

▲ Fee-based contracts

▲ Limited replacement risk (no

other alternative)

▲ Fee-based contracts (with

fixed day rates regardless of production)

▼ Single-field exposure

(however, can be redeployed)

▲ No direct exposure to

commodity markets

▲ No seasonality

• Less capex intensive

storage option than land-based terminals

• Long life extension option of shuttle tanker fleet

Additional Attributes

ALP / Towage

Less Stable

Primarily Spot Market

10 vessels

▲ Required service for

moving large floating objects (FPSOs, rigs etc.)

▼ Short-term contracts

• Largest player in niche

market

• Highest spec fleet in the

industry

n/a

Strong and stable financial performance despite oil price fluctuations

6 Source: Macrotrends and Altera

• Steady cash flows through cycles as Altera’s business are linked to E&P’s long-term projects

• Downside protection due to the delivery of critical infrastructure and long-term contracts

• Close to 50% growth in EBITDA through the 5 years period after the market downturn in 2014

Adjusted EBITDA vs Brent Crude

0

20

40

60

80

100

120

140

160

-

100

200

300

400

500

600

700

800

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 LTM Q2-20

Bre

nt

price (

$/b

bl)

US

D m

illio

ns

Adj EBITDA Petrobras Settlement Brent

Brookfield is a Strong and Committed Sponsor

7

Board composition:

4 Brookfield and

4 independents


GP LLC

Voting Control 100%


LP

Shuttle TankersGreen Bond Issuer

FPSO / FSO Other Assets

98.7%

Brookfield has

invested and committed $1.375B

of debt and equity

• On January 22, 2020, the acquisition by merger of Teekay

Offshore by Brookfield was completed

• As a result of the merger, Brookfield owns 98.7% of the outstanding unlisted common units and unaffiliated

unitholders, who elected to receive equity consideration in respect of their common units, hold 1.3%

• Effective March 24, 2020, Teekay Offshore Partners L.P. changed its name to Altera Infrastructure L.P. and the group of entities comprising the Partnership’s affiliates and

subsidiaries was rebranded as Altera Infrastructure

100% 100% 100%

Recent Privatization and Rebranding

Simplif ied structure diagram reflects current ownership. Source: Brookfield

Brookfield Asset Management Overview

8

120 years’ experience as a leading global investor, operator and manager of real assets

$515B+ASSETS UNDER MANAGEMENT

~150,000OPERATING EMPLOYEES

30+COUNTRIES

Extensive experience owning and operating

businesses in the energy supply chain

• 16,500 km of natural gas transmission pipelines primarily in the US

• 600 billion cubic feet of natural gas storage in the US and Canada

• Canada’s leading low-cost coalbed methane producer with 1.3 trillion cubic feet equivalent of proved and

probable reserves

• 19 natural gas processing plants in Canada

• District energy systems delivering heating and cooling to customers from centralized systems (US, Canada,

Australia)

• Road fuels distribution and marketing in UK, Canada and Brazil

• Global investments in ports and rail (US, Europe, Australia)

• Rated A- and Baa1 by S&P and Moody’s respectively

Significant banking, equity and debt capital

markets relationships within Brookfield and

through investee companies

Note: Operating employees and assets as at March 31, 2020. Source: Brookfield

http://www.google.ca/url?sa=i&rct=j&q=&esrc=s&frm=1&source=images&cd=&cad=rja&uact=8&ved=0ahUKEwjrqb3UofDJAhXDNj4KHYnMDJYQjRwIBw&url=http://ir.kindermorgan.com/press-release/all/natural-gas-pipeline-company-america-and-cheniere-agree-natural-gas-transportation&psig=AFQjCNFisPn36hSig-oYaw1m3yXzUiLReA&ust=1450900999055792

Key Financials

9

Adjusted EBITDA(1) (in $ million)

Net Debt to Adj. EBITDA(1) Equity Ratio (%)

Revenues(1) by Segment (in $ million)

$457

$616$571

$522

$692 $672$621

$0

$200

$400

$600

$800

201920152014 20182016 LTM Q2-202017

$200

$0

$400

$800

$600

$1 000

$1 200

$1 400

2014 20172015 2016 2018 2019 LTM Q2-20

Shuttle Tanker OtherFSO TowageFPSO

5.0x 5.3x 5.3x6.0x

4.0x4.8x

5.6x

0x

1x

2x

3x

4x

5x

6x

7x

20192014 20182015 2016 LTM Q2-202017

20%17%

20%

26% 27%

22%

0%

5%

10%

15%

20%

25%

30%

2014 201920162015 2017 2018 Q2-20

16%(2)

1) Adjusted EBITDA and NIBD on a fully consolidated basis. 2018 revenues and adjusted EBITDA exclude impact of Petrobras settlement of $91m

2) Drop in equity ratio primarily due to impairment charges and unrealized fair value loss on derivative instruments

Source: Altera Infrastructure

Operational excellence creates value for Altera

10 Source: Altera Infrastructure

FPSO Segment

Utilization

Adjusted EBITDA (US$ millions)

Technical Uptime


TowageFSO SegmentShuttle Segment

Technical Uptime


Economic Uptime


99% 99% 99% 99% 99% 99% 99% 97%

Q3-18 Q4-18 Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 Q2-20

99%96%

99% 100% 100% 99% 98%

91%

Q3-18 Q4-18 Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 Q2-20

97% 98% 99% 98% 99% 100% 100% 100%

Q3-18 Q4-18 Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 Q2-20

66%58%

96%

67%

53%

69%

34%25%

Q3-18 Q4-18 Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 Q2-20

92

109

94

72 7382

76 74

Q3-18 Q4-18 Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 Q2-20

65

6967 68 66 66

6467

Q3-18 Q4-18 Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 Q2-20

21

26

23 23 24 23 24

12

Q3-18 Q4-18 Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 Q2-20

(2)(1)

4

0

(1)

2

-4

-6

Q3-18 Q4-18 Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 Q2-20

11FPSO – Petrojarl Knarr

FPSOs Employed Across the Production Life Cycle

12 Refer to Altera Infrastructure 20-F for contract details

Itajai(Firm period to 2022)

Piranema Spirit(April 2021)

Libra(Firm period to 2029)

Petrojarl Knarr(Firm period to 2022)

Run-Rate production

Online & producing most

significant flow at field

Deployment to field

Operational start-up

Movement to port

Tender process initiated

Output reduction

Petrojarl I(Firm period to 2023)

New Projects Voyageur Spirit

Petrojarl Varg

Large number of FPSOs expected to be contracted going forward

13 Source: Rystad Energy

3

0

8

6

14

2

1 5

17

9

13

0

5

10

15

20

2015 2016 2017 2018 2019 2020e 2021e 2022e 2023e 2024e

FP

SO

Contr

acts

Aw

ard

ed

Awarded To be awarded

14Aurora Spirit – First E-shuttle delivered

Altera Shuttle Tankers is the Market Leader within its Key Markets

15 Source: Clarksons and Altera

100%

Fleet Size by Owner (# of vessels)Market Share by Region (including order book)

Global fleet North Sea

BrazilCanada

• Largest operator in the North Sea and the only operator in Canada

• Presence less dominant in the more commoditized Brazilian market

Altera Other

2927

12

53 2 2

4

3

4

1

0

5

10

15

20

25

30

35

Knutsen Altera AET VikenMol Tsakos Transpetro Elka

# o

f ve

ssels

On Order

Trading fleet

31%

69%

47%53%

13%

87%

The Market is Fundamentally Different From Commodity Shipping


• A significantly less volatile business environment than in commodity shipping

• Adjusted EBITDA per vessel has increased over the past years on the back of higher rates and reduced opex

$6.7$7.2

$6.8$6.3

$5.5

$6.3 $6.2

$7.2$7.5

$8.0

$8.7 $8.9$9.0

$10.0 $10.1$10.4

$0

$2

$4

$6

$8

$10

$12$90 000

$30 000

$40 000

$0

$10 000

$20 000

$50 000

$70 000

$60 000

$80 000

2009 201520102005 2006 2007 2008 2011 2012 2013 2014 2016 2017 2018 2019 LTM Q2-20

AST’s Adj. EBITDA per owned vessel (rhs) VLCC (3-year TC) Cape (3-year TC)

0

2

4

6

8

10

12

14

16

On water On order

12% of the existing fleet has exceed 20 years this year


Existing Fleet & Order Book (Vessels by Year Built and Expected Year of Delivery) Global Fleet Given Recycling at 20 Years

~12% of the commercial fleet has exceeded 20

years, and will thus likely be recycled given oil

companies’ requirement of vessels being below 20

years

This compares to the order book comprising 17%

of the existing fleet, of which all vessels are

ordered against long-term charter contracts to

replace outdated tonnage

Fleet size is relatively stable when including the

order book and excluding vessels above 20 years

(from 2020). Additional newbuildings are required

to meet production growth

~12% of the existing fleet has exceeded 20 years

Order book equals to ~17% of the existing fleet

69 71 7175 71 69

12 8 6

0

10

20

30

40

50

60

70

80

90

2020 2021 2022 2023 2024 2025

# o

f shutt

le t

ankers

On water On order

Shuttle tanker market facing strong demand growth


0

1,000

2,000

3,000

4,000

5,000

6,000

kbbl/d

Production exported by shuttle tankers

North Sea Canada Brazil

Steady increasing volumes from Brazil contribute to the 34% growth in volumes from 2020 to 2030

• The largest growth in terms of barrels is in Brazil

• North Sea volumes are expected to grow 50% over the next 10 years

• Altera have an unique operating model well suited to take advantage of the increased volumes going forward

34%

Source: DNV GL

19

The E-Shuttles are a game changer for reduced emissions and fuel efficiency in the maritime industry

Source: IMO, DNV GL, Bloomberg, Altera. 1 https://www.regjeringen.no/no/dokumenter/handlingsplan-for-gronn-skipsfart/id2660877/20

• The new backbone to our fleet – the E-Shuttle vessel – is a true

testament to our willingness and desire to push the shipping

industry towards decarbonization

• The E-Shuttle will likely achieve the IMO GHG aim of 50%

reduction by 2020, well ahead of the 2050 goal

• More than $30 million invested per ship in initiatives to reduce

emissions:

• VOC recovery plants, LNG as primary fuel, recovered

VOC as a secondary fuel

• Battery hybrid technology and Gas Electric power

distribution

• The E-Shuttles classifies as “low emission vessels” according to

the Norwegian Government’s “Plan of action for green shipping”

• Our ambitious investments and sustainability agenda have the

potential of accelerating necessary transition in the wider

shipping industry

CO2 Eq.

emissionNOX emission SOX emission Particulates

Fuel

consumption

-47% -88% -99% -93% -47%

Traditional Shuttle Tanker TOO E-Shuttle

Massive environmental impact in terms of CO2 emission

*Tailpipe emission reduction compared to the Explorer Class vessels - (108 000 ton CO2eqv(GWP100)). Source: Altera and Opplysningsrådet for Veitrafikken (OFV) in Norw ay21

1 E-Shuttle 15,000 Teslas

=

Access to Diversified Funding Sources

Strong Banking Group Backing Altera Infrastructure

1) Outstanding draw n debt as of June 30, 2020

Source: AST

$ millions(1)

Altera Infrastructure Sources of Capital

22

1,075

513640

759

241

24

125

Unsecured Bonds Revolving Credit Term LoansECA Loans US PP Bonds SLBBrookfield RCF

$3.4Bn

Altera Infrastructure Debt Maturity Schedule¹

23 1) Outstanding draw n debt as of June 30, 2020Source: AST

• Includes both scheduledamortizations and debtballoons

• Revolving Credit Facilitiesand debt related to newbuildsshown as fully drawn

• FPSO JV debt is excluded, inline with the Balance Sheetrepresentation

• Including upsizing andextension of the BrookfieldRCF from $125 to 200 millionwith extended maturity toOctober 2024

$156

$386

$661

$1,191

$673

$134

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

Remaining 2020 2021 2022 2023 2024 2025

MIL

LIO

NS

Brookfield RCF Scheduled Amortization Secured Debt Balloons Unsecured Debt

Capital structure

24

Capital Structue & Free Cash Flow

Shuttle

Jun 30th, 2020 Tankers FPSO FSO/UMS Towage Parent Total Coupon Maturity Leverage

Unrestricted Cash 241 241

Revolvers 396 80 476 various various

Term Loans 208 390 108 214 920 various various

Term Loans (ECA's) 359 381 26 765 various various

Shuttle Tankers Bond 250 250 7.125% 8/15/22

Green Bond 125 125 L+650 10/18/24

Private Placement Bonds 103 113 12 228 various various

SLB 60 60 L+285 10 yrs

Bridge ($100mm) - L+250 Aug '22

Total Secured Debt 1,501 963 146 214 241 $2,824 4.6x

Senior Notes 700 700 8.500% 7/15/23

Revolvers 125 125

Total Debt $3,649 6.0x

Total Net Debt 3,408 5.6x

Preferred - A 150 7.250% Perp

Preferred - B 125 8.500% Perp

Preferred - E 120 8.875% Perp

EV through Pref 3,803 6.2x

Sponsor Equity 780

Enterprise Value 4,583 7.5x

LTM Adjusted EBITDA $258 $305 $69 ($10) ($10) $612

JV EBITDA

Maintenance Capex (9)

Cash Interest (193)

Cash Taxes (2)

Preferred Distributions (32)

Free Cash Flow $376

Numbers as of June 30, 2020

Source: AST

25

Appendix

End Q2 2020 Shuttle Charter Summary

26

Time-charter

CoA

Bareboat

Spot

Please also refer to Form 20-F for the f iscal year ended December 31, 2019.

VesselQ1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Peary Spirit

Samba Spirit

Lambada Spirit

Bossa Nova Spirit

Sertanejo Spirit

Beothuk Spirit

Norse Spirit

Dorset Spirit

Altera Thule

Nansen Spirit

Petroatlantic

Petronordic

Aurora Spirit

Rainbow Spirit

Navion Oceania

Tide Spirit

Current Spirit

Altera Wave

Altera Wind

Amundsen Spirit

Scott Spirit

Stena Natalita (50% JV)

Heather Knutsen (in-charter)

Ingrid Knutsen (in-charter)

Navion Oslo

Navion Anglia

Navion Gothenburg (50% JV)

Nordic Rio (50% JV)

Nordic Brasilia

Navion Stavanger

Navion Bergen

20252020 2021 2022 2023 2024

End Q2 2020 FPSO and FSO Charter Summary

27 Please also refer to Form 20-F for the f iscal year ended December 31, 2019.

OptionsFirm Available

FPSO, location

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Libra, BR

Itajai, BR

Knarr, NO

Petrojarl 1, BR

Piranema, BR

Voyageur, UK

Varg, NO

2020 2021 2022 2023 2024 2025

FSO, location

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Randgrid, NO

Suksan Salamander, TH

Dampier Spirit, AU

Falcon Spirit, QR

Apollo Spirit, UK

20252020 2021 2022 2023 2024

Shuttle Tanker Newbuilding Program

28 Please also refer to Form 20-F for the f iscal year ended December 31, 2019.

ECC vessel #4

• Steel cutting – Nov 20

• Keel laying – May 21

• Launching – Aug 21

• Est. delivery – Mar 22

Aurora Spirit

• Steel cutting

• Keel laying

• Launching

• Delivery

Rainbow Spirit

• Steel cutting

• Keel laying

• Launching

• Delivery

Q1 2020 Q3 2020 Q1 2021 Q1 2022

Tide Spirit

• Steel cutting

• Keel laying

• Launching

• Delivery

Current Spirit

• Steel cutting

• Keel laying

• Launching

• Delivery

Wave Spirit

• Steel cutting

• Keel laying

• Launching

• Est. delivery – Oct 20

Wind Spirit

• Steel cutting

• Keel laying

• Launching

• Est. delivery – Jan 21

…

The Shuttle Tanker Market in Brief

29

Shuttle Tankers

Conventional Crude Tanker

Ordering of New Ships With contract in place Mainly speculative

Global Fleet Size 77 + 13 on order ~5,600

Capacity of Global Fleet Size

10.1 million dwt(excludes newbuildings)

~140 million dwt

Number of owners 7 ~200

Cost of a new Vessel (Aframax)

$110 - $130 million (extra for VOC)

$40 - $60 million

1. Time Charters – 10 vessels (Shell, Equinor, East Coast Canada Consortium)

• Firm contract with specified day rate• Multi-year contracts, normally with extension options• Altera operates vessel and provide crews

Bareboat Charters – 1 vessel (Petrobras)

• Firm contract with specified day rate• Multi-year contracts

• Charterer (not Altera) provides crew and is responsible for opex and

maintenance

“CoA” – 12 vessels (multi-client)

• Unique, niche business model in the North Sea where Altera is the market leader

• Firm contract with specified day rate per customer for all liftings from a designated field

• Most contracts include day rate escalation clauses

• Nominations are voyage-specific (i.e. 4-10 days), typically with one-year forward visibility on volumes

• Significant value proposition to the customer, particularly when volumes do not justify a dedicated Time Charter

• Compensated for volume risk compared to TC contracts trough a higher day rate

• Fleet size and ability to service multiple customers act as a barrier to entry

1

2

3

Highly Specialized Assets Altera Shuttle Tankers’ Revenue Model(1)

Global Fleet Distribution(2)

1) Altera unit count does not include new buildings that replace retiring vessels and 3 units trading in the spot market

2) Global trading f leet

Sources: Clarksons and Altera

38%

51%

4%7%

North Sea

Brazil

Canada

Other

Documents

Altera Infrastructure · 2020. 9. 9. · Altera Infrastructure in a brief 4 (1) As of June 30, 2020. Based on existing contracts; but excluding extension options and oil-tariff revenue