UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 _______________________________ 
FORM 20-F
  _______________________________  
(Mark One)
☐
REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) or (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
OR
☒
ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2025
OR
☐
TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
OR
☐
SHELL COMPANY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of event requiring this shell company report                 
For the transition period from                      to                     
Commission file number 1-32479
  _______________________________ 
SEAPEAK LLC
(Exact name of Registrant as specified in its charter)
  _______________________________ 
Republic of The Marshall Islands
(Jurisdiction of incorporation or organization)
2000, 550 Burrard Street, Vancouver , BC, Canada, V6C 2K2
(Address of principal executive offices)
Scott Gayton
2000 , 550 Burrard Street, Vancouver, BC, Canada, V6C 2K2
Telephone: (604) 609-4735
Email: Enquiries@seapeak.com
(Name, Telephone, Email and/or Facsimile number and Address of company Contact Person)
Securities registered, or to be registered, pursuant to Section 12(b) of the Act.
Title of each class
Trading Symbol
Name of each exchange on which registered
Series A Preferred Units
SEAL/PA
New York Stock Exchange
Series B Preferred Units
SEAL/PB
New York Stock Exchange
Securities registered, or to be registered, pursuant to Section 12(g) of the Act.
None
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.
None
  _______________________________ 
Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual
report.
4,932,548 Series A Preferred Units
6,596,115 Series B Preferred Units
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes  ¨   No  ý 
If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934.    Yes  ¨    No  ý
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.    Yes  ý    No  ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of
Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such
files).    Yes  ý    No  ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company.
See the definitions of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large Accelerated
Filer
¨
Accelerated Filer
¨
Non-Accelerated
Filer
x
Emerging growth
company
☐
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected
not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the
Exchange Act.    ¨          
† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting
Standards Codification after April 5, 2012.
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal
control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that
prepared or issued its audit report.      Yes  ¨ No  ý
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the
filing reflect the correction of an error to previously issued financial statements.        Yes  ¨ No  ¨
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation
received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b).        Yes  ¨ No  ¨
Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:
U.S. GAAP
ý
International Financial Reporting Standards
as issued by the International Accounting
Standards Board
¨
Other
¨
If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to
follow:Item 17  ¨        Item 18   ¨
If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes  ☐        No  ý
Auditor Name:KPMG LLPAuditor Location:Vancouver BC, CanadaAuditor Firm ID:85
1
SEAPEAK LLC
INDEX TO REPORT ON FORM 20-F
 
 
Page
Item 1.
Item 2.
Item 3.
Item 4.
Item 4A.
Item 5.
Item 6.
Item 7.
Item 8.
2
Item 9.
Item 10.
Item 11.
Item 12.
Item 13.
Item 14.
Item 15.
Item 16A.
Item 16B.
Item 16C.
Item 16D.
Item 16E.
Item 16F.
Item 16G.
Item 16H.
Item 16I.
Item 16J.
Item 16K.
Item 17.
Item 18.
Item 19.
3
PART I
This Annual Report should be read in conjunction with the consolidated financial statements and accompanying notes included in this report.
Unless otherwise indicated, references in this Annual Report to “Seapeak,” the “Company,” “we,” “us” and “our” and similar terms refer to Seapeak
LLC and/or one or more of its subsidiaries, except that those terms, when used in this Annual Report in connection with common units or the
preferred units described herein, shall mean specifically Seapeak LLC.
In addition to historical information, this Annual Report contains forward-looking statements that involve risks and uncertainties. Such forward-
looking statements relate to future events and our operations, objectives, expectations, performance, financial condition and intentions. When used
in this Annual Report, the words “expect,” “intend,” “plan,” “believe,” “anticipate,” “estimate” and variations of such words and similar expressions
are intended to identify forward-looking statements. Forward-looking statements in this Annual Report include, in particular, statements regarding:
 
• our ability to make cash distributions on our preferred units;
• our future financial condition and results of operations, our future revenues, expenses and capital expenditures, and our expected financial
flexibility to pursue capital expenditures, acquisitions and other expansion opportunities, including vessel acquisitions;
• our liquidity needs, including our anticipated funds and sources of financing for liquidity and working capital needs, and the sufficiency of cash
flows;
• our ability to obtain financing, including new bank financings and financing for our newbuilding vessels, and to refinance existing indebtedness;
• growth prospects and future trends of the markets in which we operate;
• our expectations regarding demand for natural gas and transportation of liquified natural gas (or LNG) and natural gas liquids (or NGL);
• our expectations regarding applicability of tax exemptions and tax liabilities, including whether applicable tax authorities may agree with our tax
positions;
• LNG and NGL market fundamentals, including the balance of supply and demand in the LNG and NGL markets, estimated growth in size of
the world LNG and NGL fleets and spot LNG and NGL charter rates;
• our expectations as to the useful lives of our vessels;
• our expectations and estimates regarding future charter business, including with respect to minimum charter hire payments, revenues and our
vessels’ ability to perform to specifications and maintain their hire rates in the future;
• our expectations regarding the ability of our customers to make charter payments to us;
• our ability to maximize the use of our vessels, including the redeployment or disposition of vessels no longer under long-term charter or whose
charter contract is expiring in 2026 and 2027;
• our expectations regarding the expected delivery dates for newbuilding vessels;
• expected employment of vessels, including, among other things, types, commencement and durations of employment;
• the impact of the Russia-Ukraine war, current tensions and war activities in the Middle East, and the disruptions in the Red Sea on the
economy, our industry and our business, including as the result of sanctions on Russian companies and individuals and any retaliatory
measures by Russia or other countries in response;
• the adequacy of our insurance coverage, less any applicable deductible;
• the possibility of future resumption of the LNG plant in Yemen operated by Yemen LNG Company Limited (or YLNG) and the repayment of
deferred hire amounts from YLNG on our two 52%-owned vessels, the Seapeak Marib and Seapeak Arwa;
• our ability to continue to derive a significant portion of our revenues and cash flow from a limited number of customers;
• our continued ability to enter into long-term, fixed-rate time-charters with our LNG and NGL customers;
• obtaining LNG and NGL projects that we bid on;
• our expectations regarding the performance of the receiving and regasification terminal in Bahrain owned by Bahrain LNG W.L.L., a joint
venture owned by us (30%), BAPCO Energies B.S.C. (or BAPCO ) (30%), Gulf Investment Corporation (24%) and Samsung C&T (16%) (or the
Bahrain LNG Joint Venture);
• our ability to obtain all permits, licenses, and certificates with respect to the conduct of our operations;
• the impact and expected cost of, and our ability and plans to comply with, new and existing governmental regulations and maritime self-
regulatory organization standards applicable to our business, including, among others, the European Union's implementation of the EU
Emissions Trading Systems Directive;
• the impact on our business of heightened awareness of and concern with climate change, including on demand for our services and alternative
energy sources to LNG and NGL;
• the expected impact of heightened environmental and quality concerns of insurance underwriters, regulators and charterers;
• the future valuation or impairment of our assets, including goodwill;
4
• our hedging activities relating to foreign exchange, interest rate and spot market risks, and the effects of fluctuations in foreign currency
exchange, interest rate and spot market rates on our business and results of operations;
• the potential impact of new accounting standards guidance or the adoption of new accounting standards;
• our ability to maintain good relationships with the labor unions that work with us;
• the outcome of pending litigation and claims; and
• our business strategy and other plans and objectives for future operations, including our Environmental, Social and Governance (or ESG)
initiatives.
Forward-looking statements involve known and unknown risks and are based upon a number of assumptions and estimates that are inherently
subject to significant uncertainties and contingencies, many of which are beyond our control. Actual results may differ materially from those
expressed or implied by such forward-looking statements. Important factors that could cause actual results to differ materially include, but are not
limited to, those factors discussed in “Item 3 – Key Information: Risk Factors,” and other factors detailed from time to time in other reports we file
with or furnish to the U.S. Securities and Exchange Commission (or the SEC).
We do not intend to revise any forward-looking statements in order to reflect any change in our expectations or events or circumstances that may
subsequently arise. You should carefully review and consider the various disclosures included in this Annual Report and in our other filings made
with the SEC that attempt to advise interested parties of the risks and factors that may affect our business prospects and results of operations.
Item 1. Identity of Directors, Senior Management and Advisers
Not applicable.
Item 2. Offer Statistics and Expected Timetable
Not applicable.
Item 3. Key Information
RISK FACTORS
Some of the risks summarized below and discussed in greater detail in the following pages relate principally to the industry in which we operate and
to our business in general. Other risks relate principally to the securities market and to ownership of our preferred units. The occurrence of any of
the events described in this section could materially and adversely affect our business, financial condition, operating results and ability to pay
distributions on, and the trading price of, our preferred units.
Risk Factor Summary
Risks Related to Our Industry
• Our future performance and ability to secure future employment for our LNG and NGL vessels depends on growth in LNG and NGL
production, demand and supply for LNG and NGL, and associated demand and supply for LNG and NGL shipping.
• Adverse economic conditions or other developments, including disruptions in the global credit markets, could adversely affect our business
and may affect our customers’ ability to pay for our services.
• Declines in natural gas and oil prices may adversely affect our growth prospects and results of operations.
• If the active short-term, medium-term or spot LNG shipping markets continue to develop, entering into long-term, fixed-rate LNG time-charters
may be difficult.
• Marine transportation incidents involving any of our vessels could harm our business.
• Terrorist attacks, increased hostilities, political change or war could lead to further economic instability, increased costs and business
disruption.
• Acts of piracy and acts of hostility from armed groups, militias, state sponsored forces and nation state forces against ocean-going vessels
continue to be a risk, which could adversely affect our business, financial condition and results of operation.
Risks Related to Our Business
• We may not have sufficient cash from operations to enable us to pay distributions on our preferred units.
• Over time, the value of our vessels may decline, which could result in both write-downs and an adverse effect on our operating results.
• Substantial operations outside the United States expose us and our customers to political, governmental and economic instability, which could
harm our operations.
• Growing trade protectionism may adversely impact our operations and financial condition.
• We depend on certain of our joint venture partners to assist us in operating our business.
5
• We may be unable to charter or recharter vessels at attractive rates, which may lead to reduced revenues and profitability.
• The loss of any key customer, charter or vessel, or any material adjustment to our charter contracts could result in a significant loss of
revenues and cash flow.
• Financing agreements containing operating and financial restrictions may restrict our business and financing activities.
• Any capital expenditures may impact our liquidity position. Our failure to obtain the funds for necessary future capital expenditures could have
a material adverse effect on our business.
• Delays in deliveries of newbuildings or in conversions or upgrades of existing vessels could harm our operating results and lead to the
termination of related charters.
• Our substantial debt levels may limit our flexibility in obtaining additional financing, refinancing credit facilities upon maturity, and pursuing
other business opportunities.
• Restrictions in our financing agreements may prevent us from paying distributions on our preferred units.
• We and certain of our joint venture partners may be unable to attract and retain qualified, skilled employees or crew necessary to operate our
business, or may have to pay substantially increased costs for our employees and crew.
• Changes in the NGL markets could result in decreased demand for our NGL vessels operating in the spot market.
• We may face substantial competition to expand relationships with existing customers and obtain new customers.
• We have recognized asset impairments in the past and we may recognize additional impairments in the future.
• Increased technological innovation in vessel design or equipment could reduce the competitive capability of certain of our vessels, our charter
hire rates and the value of our vessels.
• Actual results of new vessel technologies or upgrades may differ from expected results and affect our results of operations.
• We or our partners may be exposed to conditions or requirements that adversely affect us or our joint ventures.
• Implementing our strategy through acquisitions may harm our business and we may not realize expected benefits.
• Our insurance may not be sufficient to cover losses that may occur to our property or result from our operations.
• Sanctions against participants in the Yamal LNG Project could impede the performance of the project. 
• Failure, shutdown or other adverse events impacting the Yamal LNG Project may result in our inability to re-deploy the ARC7 LNG carriers.
• We assume credit risk by entering into agreements with unrated entities.
• Exposure to currency exchange rate and interest rate fluctuations will result in fluctuations in our cash flows and operating results.
• If we fail to maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results
or prevent fraud.
• 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 operations.
• Our directors and officers and Stonepeak Partners L.P. (or Stonepeak) and its other affiliates have conflicts of interest and limited or no
fiduciary duties, which may permit them to favor their own interests to those of us or our preferred unitholders.
• Except in limited circumstances, our board of directors (or Board) has the power and authority to conduct our business without approval of our
preferred unitholders.
• Our joint venture arrangements impose obligations upon us but in certain circumstances limit our control of the joint ventures, which may affect
our ability to achieve our joint venture objectives.
Legal and Regulatory Risks
• Climate change and greenhouse gas (or GHG) restrictions may adversely impact our operations and markets.
• Scrutiny and expectations with respect to ESG policies and practices may impose additional costs on us or expose us to additional risks.
• The marine energy transportation industry is subject to substantial environmental and other regulations.
• Failure to comply with anti-bribery legislation, sanctions legislation or trade compliance regulations could result in fines, criminal penalties,
contract terminations and an adverse effect on our business.
• Our operations may be subject to economic substance requirements in the Marshall Islands and other offshore jurisdictions, which could
impact our business, financial condition and operating results.
Information and Technology Risks
• A cyber-attack could materially disrupt our business.
• Our failure to comply with data privacy laws could damage our customer relationships and expose us to litigation risks and potential fines.
• Use of artificial intelligence presents risks and challenges that could impact our business.
6
Risks Related to an Investment in Our Securities
• It may be difficult to serve us with legal process or enforce judgments against us, our directors or our management.
• Holders of our preferred units have extremely limited voting rights.
• Our preferred units have not been rated, and ratings of any other of our securities may affect the trading price of the preferred units.
• Market interest rates may adversely affect the value of our preferred units.
• Our preferred units represent perpetual equity interests in us.
• Our Series A Preferred Units are redeemable at our option, and our Series B Preferred Units will become redeemable at our option.
Tax Risks
• U.S. tax authorities could treat us as a “passive foreign investment company” (or PFIC) which could have adverse U.S. federal income tax
consequences to U.S. holders.
• We may be subject to changes in tax legislation, which could impact our liquidity position.
Risks Related to Our Industry
Our future performance and ability to secure future employment for our LNG and NGL vessels depends on growth in LNG and NGL
production, demand and supply for LNG and NGL, and associated demand and supply for LNG and NGL shipping.
Our future performance, including our ability to strengthen our balance sheet and to profitably employ and expand our fleet, will depend on growth
in LNG and NGL production, demand and supply for LNG and NGL, and associated demand and supply for LNG and NGL shipping services.
Demand or supply for LNG and NGL and for the marine transportation of LNG and NGL could be negatively affected by a number of factors, such
as:
• increases in the cost of natural gas derived from LNG relative to the cost of natural gas generally;
• increases in the cost of NGL relative to the cost of other competing petrochemicals;
• 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;
• decreases in the consumption of natural gas due to increases in its price relative to other energy sources, such as oil, or other factors making
consumption of natural gas less attractive;
• increases in availability of additional sources of natural gas, including shale gas;
• increases in the number of LNG or NGL newbuilding vessels, which could lead to an oversupply of vessels in the market and in turn create
downward pressure on the demand for LNG and NGL shipping services;
• changes in weather patterns leading to warmer winters in the northern hemisphere and lower gas demand in the traditional peak heating
season;
• increases in availability of alternative or renewable energy sources; and
• negative global or regional economic or political conditions, particularly in LNG and NGL consuming regions, which could reduce energy
consumption or its growth, including labor or political unrest or military conflicts affecting existing or proposed areas of LNG production or
regasification.
In addition, continuation of the Russia-Ukraine war may significantly impact global economic activity (including the demand for LNG and NGL, and
associated shipping rates, which may in turn negatively affect our vessels) and may disrupt, delay or lead to cancellations of the construction of new
LNG projects (including production, liquefaction, regasification, storage and distribution facilities), which could negatively affect our business, results
of operations and financial condition. The United States has been in discussions with Russia and Ukraine aimed at ending the Russia-Ukraine war.
Such discussions remain ongoing and it is uncertain if or when the conflict will be resolved.
Separately, tensions in the Middle East may impact our business. This includes the Hamas-Israel war which has been ongoing since 2023. Most
recently, in February 2026, the U.S. and Israel launched a major attack on Iran which has resulted in a retaliation by Iran against U.S. military bases
in the Middle East and other targets. This recent conflict in the Middle East has resulted in attacks on commercial vessels, disruption of shipping
trade routes and high risk in entering the Strait of Hormuz. This ongoing conflict is expected to affect the price of natural gas, demand for LNG and
NGL shipping, and increase insurance rates, all of which could adversely affect our business, results of operations and financial condition.
7
Adverse economic conditions or other developments may affect our customers’ ability to charter our vessels and pay for our services
and may adversely affect our business, financial condition and results of operations.
Adverse economic conditions or other developments relating directly to our customers may lead to a decline in our customers’ operations or ability
to pay for our services, which could result in decreased demand for our vessels and services. Our customers’ inability to pay for any reason could
also result in their default on our current contracts and charters. The decline in the amount of services requested by our customers or their default
on our contracts with them could have a material adverse effect on our business, financial condition and results of operations.
Adverse economic conditions, including disruptions in the global credit markets, could adversely affect our business, financial
condition, and results of operations.
Economic downturns and financial crises in the global or regional markets could produce illiquidity in the capital markets, market volatility, increased
exposure to interest rate and credit risks and reduced access to capital markets. If global financial markets and economic conditions significantly
deteriorate in the future, we may face restricted access to the capital markets or bank lending, which may make it more difficult and costly to fund
future growth. Decreased access to such resources could have a material adverse effect on our business, financial condition and results of
operations.
Declines in natural gas and oil prices may adversely affect our growth prospects and results of operations.
Low energy prices may negatively affect both the competitiveness of natural gas as a fuel for power generation and the market price of natural gas,
to the extent that natural gas prices are benchmarked to the price of crude oil. Low energy prices may also adversely affect energy and capital
markets and available sources of financing for our capital expenditures and debt repayment obligations. If a sustained low energy price environment
were to develop, our business, results of operations and financial condition may be adversely affected, as well as our ability to make cash
distributions on our preferred units, as a result of, among other things, the following events which are beyond our control:
• fluctuations in worldwide and regional supply of and demand for natural gas;
• a reduction in exploration for or development of new natural gas reserves or projects, or the delay or cancellation of existing projects as energy
companies lower their capital expenditures budgets, which may reduce our growth opportunities;
• lower demand for vessels of the types we own and operate, which may reduce available charter rates and revenue to us upon redeployment of
our vessels following expiration or termination of existing contracts or upon the initial chartering of vessels, or which may result in extended
periods of our vessels being idle between contracts;
• customers potentially seeking to renegotiate or terminate existing vessel contracts, or failing to extend or renew contracts upon expiration, or
seeking to negotiate cancellable contracts;
• the inability or refusal of customers to make charter payments to us or to our joint ventures, due to financial constraints or otherwise; or
• declines in vessel values, which may result in losses to us upon vessel sales or impairment charges against our earnings.
We may have more difficulty entering into long-term, fixed-rate LNG time-charters if the active short-term, medium-term or spot LNG
shipping markets continue to develop.
LNG shipping historically has been transacted with long-term, fixed-rate time-charters, usually with terms ranging from 15 to 20 years. One of our
principal strategies is to enter into additional long-term, fixed-rate LNG time-charters. In recent years, the amount of LNG traded on a spot and
short-term basis (defined as contracts with a duration of three years or less) has been increasing.
If the active spot, short-term or medium-term markets continue to develop, we may have increased difficulty entering into long-term, fixed-rate time-
charters for our LNG carriers and, as a result, our cash flow may decrease and be less stable. In addition, an active short-term, medium-term or
spot LNG shipping market may require us to enter into charters with rates 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.
LNG shipping spot rates surged in 2022 mainly driven by European LNG imports as Europe switched towards LNG in efforts to end its reliance on
Russian gas. However, LNG shipping spot rates softened in 2024 and experienced a further decrease in 2025 due to high inventory storage levels,
primarily in Europe, a relatively mild winter and an increase in nuclear and renewable power sources in Asia. If LNG shipping spot rates continue to
soften or further decline in 2026 and beyond, this may adversely impact our business, financial condition and results of operations.
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.
Our vessels, crew and cargoes are at risk of being damaged, injured or lost because of events such as:
• marine disasters;
• bad weather or natural disasters;
• mechanical failures;
• grounding, fire, explosions and collisions;
• piracy (hijacking and kidnapping);
• cyber-attack;
8
• acute-onset illness in connection with global or regional pandemics or similar public health crises;
• mental health of crew members;
• human error; and
• war, terrorism and regional hostilities in areas where our vessels may transit.
An accident involving any of our vessels could result in any of the following:
• significant litigation with our customers or other third parties;
• death or injury to persons, loss of property or environmental damage;
• delays in the delivery of cargo;
• liabilities or costs to recover any spilled fuel oil, NGL or other products and to restore the environment affected by the spill;
• loss of revenues from charters or termination of charter contracts;
• governmental fines, penalties or restrictions on conducting business;
• higher insurance rates; and
• damage to our reputation and customer relationships generally.
Any of these results could have a material adverse effect on our business, financial condition and operating results. In addition, any damage to, or
environmental contamination involving, production facilities serviced by our vessels could result in the suspension or curtailment of operations by
our customer, which would in turn result in loss of revenues.
Terrorist attacks, increased hostilities, political change or war could lead to further economic instability, increased costs and business
disruption.
Terrorist attacks, current or future conflicts in Ukraine, the Middle East and elsewhere, and political change, may adversely affect our business,
operating results, financial condition, and ability to raise capital and future growth. The Russia-Ukraine war, continuing or escalating conflicts in the
Middle East, and the presence of the United States and other armed forces in regions of conflict, may lead to further hostilities, world economic
instability, uncertainty in global financial markets, disruption of LNG and NGL production and distribution, and may adversely affect demand for our
services. Tensions between the U.S., Israel and Iran persist, and historically there have been periodic disruptions in shipping transit via the Strait of
Hormuz due to Iranian activity in the area, leading to uncertainty and heightened security risks for shipping in that region. In addition, insurers have
increased premiums and reduced or restricted coverage for losses caused by terrorist acts generally. Uncertainty in global financial markets could
also adversely affect our ability to obtain additional financing on terms acceptable to us or at all.
The sanctions imposed by the United States, European Union (or EU) nations, United Kingdom (or UK) and other countries against Russia include,
among others, bans on new investments in Russia, bans on transshipping LNG within the EU if the end-destination is outside of the EU, restrictions
on selling or importing goods, services or technology in or from affected regions, travel bans and asset freezes impacting connected individuals and
political, military, business and financial organizations in Russia, severing large Russian banks from U.S. and/or other financial systems, and barring
some Russian enterprises from raising money in the U.S. market.
During 2025, significant sanctions on Russia were implemented. In October 2025, the EU announced that effective from January 2027, imports of
Russian LNG into the EU pursuant to long-term LNG supply contracts will be banned. In November 2025, the UK announced its intention to
implement a ban on the provision of UK maritime services and UK insurance services in connection with Russian LNG exports. To date, we have
not experienced any material adverse financial impact as a result of the Russia-Ukraine war. However, as a result of these recent announcements
(and as the regulatory landscape continues to evolve), we expect we will be required to restructure our operations. In the event we are unable to
successfully restructure such operations, we may face adverse financial consequences or operational impacts.
The United States, EU nations, UK and other countries could impose additional sanctions and take other actions if the conflict is not resolved or if it
further escalates. Given Russia’s role as a major exporter of natural gas, any further sanctions imposed or actions taken by the United States, EU
nations, UK or other countries, and any retaliatory measures by Russia in response, such as restrictions on LNG or NGL shipments from Russia,
could lead to increased volatility in the price of and/or demand for natural gas and could adversely affect our charterers and result in the suspension
or early termination of our time-charter contracts, either of which could have a material adverse impact on our business, results of operations and
financial condition. In addition, it is possible that third parties with which we have charter contracts or business arrangements may be impacted by
events in Russia and Ukraine, which could adversely affect our operations and financial condition.
LNG and NGL facilities, shipyards, vessels, pipelines and gas fields could be targets of future terrorist attacks and warlike operations and our
vessels could be targets of hijackers, terrorists or warlike operations. 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 and NGL to or
from certain locations. Terrorist attacks, war, hijacking or other events beyond our control that adversely affect the distribution, production or
transportation of LNG and NGL to be shipped by us could entitle our customers to terminate our charter contracts, which would harm our cash flow
and our business.
9
Terrorist attacks or the perception that LNG or NGL facilities and carriers are potential targets for terrorism, piracy, warlike acts, or political action,
could materially and adversely affect the expansion of LNG and NGL infrastructure and the continued supply and export of LNG and NGL involving
the United States and other countries. Concern that LNG or NGL facilities may be targeted for attack by terrorists, political, or warlike groups as well
as environmental concerns, has contributed to significant community resistance to the construction of a number of LNG or NGL facilities. If a
terrorist, political, or warlike incident involving an LNG or NGL facility or LNG or NGL carrier did occur, in addition to the possible effects identified in
the previous paragraph, the incident may adversely affect the construction of additional LNG or NGL facilities or lead to the temporary or permanent
closing of various LNG or NGL facilities currently in operation.
Acts of piracy, war, and warlike acts on ocean-going vessels continue to be a risk, which could adversely affect our business, financial
condition and results of operation.
Acts of piracy have historically affected ocean-going vessels trading in regions of the world such as the South China Sea, Gulf of Guinea and the
Indian Ocean off the coast of Somalia. There continues to be a significant risk of piracy incidents in the Gulf of Guinea and South East Asia.
Additionally, there have been an increasing number of attacks on vessels in the areas of the Red Sea and off the waters of Yemen. If piracy, war, or
attacks on vessels result in regions in which our vessels are deployed being named on the Joint War Committee Listed Areas, war risk insurance
premiums payable for such coverage may increase significantly and such insurance coverage may be more difficult to obtain. In addition, crew
costs, including costs which may be incurred to the extent we employ on-board security guards and escort vessels, could increase in such
circumstances. We may not be adequately insured to cover losses from these incidents, which could have a material adverse effect on us. In
addition, hijacking as a result of an act of piracy against our vessels, a physical attack or similar event (including an attack that results in a total loss
of one of our vessels), or an increase in cost or unavailability of insurance for our vessels, could have a material adverse impact on our business,
financial condition and results of operations.
Risks Related to Our Business
We may not have sufficient cash from operations to enable us to pay distributions on our preferred units.
Our ability to pay distributions on our preferred units principally depends upon our ability to continue generating cash from our operations, which
may fluctuate based on, among other things:
• the rates we obtain from our charters and the performance by our charterers of their obligations under the charters;
• the expiration of charter contracts;
• the charterers' option to terminate charter contracts or repurchase vessels, in either case upon our breach of the relevant contract, or payment
of any applicable early termination or repurchase amounts;
• the occurrence of off-hire days;
• the utilization levels of our vessels trading in the spot or short-term market;
• the level of our operating costs, such as the cost of crews and insurance;
• the continued availability of LNG and NGL production, liquefaction and regasification facilities;
• the number of unscheduled off-hire days for our fleet and the timing of, and number of days required for, scheduled dry docking of our vessels;
• prevailing global and regional economic and political conditions;
• currency exchange and interest rate fluctuations;
• the effect of governmental regulations and maritime self-regulatory organization standards on the conduct of our business; and
• limitations on obtaining cash distributions from joint venture entities due to similar restrictions on the joint venture entities.
The actual amount of cash we will have available for distribution also will depend on factors such as:
• the level of capital expenditures we make, including for maintaining or repairing vessels, building new vessels, acquiring existing vessels and
complying with regulations;
• our debt service requirements, financial covenants and restrictions on distributions contained in our debt instruments;
• fluctuations in our working capital needs;
• our ability to make working capital borrowings, including to pay distributions to preferred unitholders; and
• the amount of any cash reserves, including reserves for future capital expenditures, anticipated future credit needs and other matters,
established by our Board, in its discretion.
Over time, the value of our vessels may decline, which could adversely affect our operating results.
Vessel values for LNG and NGL carriers can fluctuate substantially over time due to a number of different factors, including:
• prevailing economic conditions in natural gas and energy markets;
• a substantial or extended decline in demand for natural gas, LNG or NGL;
10
• competition from more technologically advanced and fuel-efficient vessels;
• the age of the vessel relative to other alternative vessels that are available in the market;
• increases in the supply of vessel capacity; and
• the cost of retrofitting or modifying existing vessels, as a result of technological advances in vessel design or equipment, changes in applicable
environmental, emissions or other regulation or standards, or otherwise.
Vessel values may decline from existing levels. If the operation of a vessel is not profitable, or if we cannot redeploy a chartered vessel at attractive
rates, rather than continue to incur costs to maintain and finance the vessel, we may seek to dispose of it. Our inability to dispose of the vessel at a
fair market value or the disposal of the vessel at a fair market value that is lower than its book value could result in a loss on its sale and adversely
affect our results of operations and financial condition. Further, if we determine at any time that a vessel’s future useful life and earnings require us
to impair its value on our financial statements, we may need to recognize a significant charge against our earnings.
Our and many of our customers’ substantial operations outside the United States expose us and them to political, governmental and
economic instability, which could harm our operations.
Because our operations, and the operations of certain of our customers, are primarily conducted outside of the United States, we or they may be
affected by economic, political and governmental conditions in the countries where we or our customers engage in business or where our vessels
are registered. Any disruption caused by these factors could harm our business or the business of these customers, including through reduction in
the levels of oil and gas exploration, development and production activities in these areas or restricting the pool of customers. We derive some of
our revenues from shipping LNG and NGL from politically and economically unstable regions, such as Russia, Angola and Yemen. Hostilities,
strikes, or other political or economic instability in regions where we or these customers operate or where we or they may operate could have a
material adverse effect on the growth of our business, results of operations and financial condition and ability to make cash distributions, or on the
ability of these customers to make payments or otherwise perform their obligations to us.
In addition, tariffs, trade embargoes, and other barriers to trade, asset freezes and other economic sanctions by the United States or other countries
against countries in which we operate, or to which we trade, or to which we or any of our customers, joint venture partners or business partners
become subject, may harm our business. For example, since 2025, general trade tensions between the United States and China led to the United
States imposing a series of tariffs on China and China responding by imposing tariffs on United States products. Our business could be harmed by
increasing trade protectionism or trade tensions between the United States and China, as well as any trade embargoes or other economic
sanctions that limit trading activities by the United States or other countries against countries in the Middle East, Asia, Russia or elsewhere as a
result of terrorist attacks, hostilities, or diplomatic or political pressures that limit trading activities with those countries. In addition, sanctions
imposed on certain Russian companies and individuals starting in 2014 based on Russia's involvement in divesting control by Ukraine of the
Crimea region and sanctions announced in response to the Russia-Ukraine war may also adversely impact our business, given Russia’s role as a
major global exporter of natural gas. Further, a government could requisition one or more of our vessels, which is most likely during war or national
emergency. Any such requisition would cause a loss of the vessel and could harm our cash flow and financial results. Please see below relating to
our two vessels chartered out to YLNG in “Item 3 – Risk Factors: We derive a substantial majority of our revenues from a limited number of
customers, and the loss of any customer, charter or vessel, or any adjustment to our charter contracts could result in a significant loss of revenues
and cash flow.”
Growing trade protectionism may adversely impact our operations and financial condition.
Our international operations expose us to the risk of potential trade protectionism. Most notably, government leaders of various countries have
declared that they may implement trade barriers to, amongst other things, protect their domestic industries against competition from foreign
companies and foreign imports. For example, since January 2025 the U.S. government has issued numerous statements and implemented various
actions, including extensive tariffs, that have impacted and may continue to impact international trade policies amongst the U.S., China, Canada,
Mexico and other countries. These actions and the actions of other countries have resulted in, and may result in additional retaliatory tariffs being
levied on various goods and commodities, which may trigger trade wars. Additionally, ongoing U.S. trade tensions with China may escalate beyond
tariffs, including additional proposed vessel port fees by both the U.S. and Chinese governments. Although such proposed vessel port fees were
mutually suspended on November 10, 2025 for a period of one-year, such trade restrictions, including in the form of tariffs and port fees, could have
a major impact on global trade and demand for shipping. Specifically, increasing trade barriers and protectionism in the markets in which our
vessels and charterers operate may cause an increase in (i) the cost of goods from exporting countries, (ii) the length of time required to deliver
goods from exporting countries, (iii) the costs of such delivery (due to proposed port fees and other trade costs) and (iv) the risks associated with
cancelling exporting goods, and therefore cancelling shipments. These factors may result in a decrease in the quantity of cargoes shipped, which
may in turn result in a decrease in a demand for our services. Any of these developments could have a material adverse effect on our business,
results of operations and financial condition.
We depend on certain of our joint venture partners to assist us in operating our business and competing in our markets.
We have entered into, and may enter into additional, joint venture arrangements with third parties to expand our fleet and access growth
opportunities. In particular, we rely on the expertise and relationships that our joint ventures and joint venture partners may have with current and
potential customers to jointly pursue LNG and NGL projects and provide assistance in competing in new markets.
Our ability to compete for the transportation requirements of certain LNG and NGL projects, enter into new charter contracts, secure financings and
expand our customer relationships depends in part on our ability to leverage our relationships with our joint venture partners and their reputations
and relationships in the shipping industry. If certain of our joint venture partners suffer material damage to their reputations or relationships it may
harm our ability to:
• renew existing charters upon their expiration;
11
• obtain new charters;
• successfully interact with shipyards during periods of shipyard construction constraints;
• obtain financing on commercially acceptable terms; or
• maintain satisfactory relationships with our employees and suppliers.
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 cash distributions to our preferred unitholders.
We may be unable to charter or recharter vessels at attractive rates, which may lead to reduced revenues and profitability.
Our ability to charter or recharter our LNG and NGL carriers upon the expiration or potential termination of their current time charters and the
charter rates payable under any renewal or replacement charters depend upon, among other things, the then current states of the LNG and NGL
carrier markets. As of December 31, 2025, in our LNG and NGL operating fleets, we had three LNG carriers, that were held for sale or
uncontracted; six and nine vessels, respectively, with charters scheduled to expire in 2026, excluding extension options; and six and seven vessels,
respectively, with charters scheduled to expire in 2027, excluding extension options. If charter rates are low when existing time charters expire, we
may be required to recharter our vessels at reduced rates or even possibly at a rate whereby we incur a loss, which would harm our results of
operations. Alternatively, we may determine to leave such vessels off-charter, which would also harm our results of operations. The size of the
current orderbooks for LNG carriers and NGL carriers is expected to result in an increase in the size of the world LNG and NGL fleets over the next
few years. An over-supply of vessel capacity, combined with stability or any decline in the demand for LNG or NGL carriers, may result in a
reduction of charter hire rates.
We derive a substantial majority of our revenues from a limited number of customers, and the loss of any customer, charter or vessel, or
any adjustment to our charter contracts could result in a significant loss of revenues and cash flow.
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. Please read “Item 18 – Financial Statements: Note 4 – Segment Reporting.”
We could lose a customer or the benefits of a time-charter if:
• the customer fails to make charter payments because of its financial inability, disagreements with us or otherwise;
• we agree to reduce the charter payments due to us under a charter because of the customer’s inability to continue making the original
payments;
• upon a breach by us of the relevant contract, 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);
• 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;
• under some of our time-charters, the customer terminates the charter because of the termination of the charterer’s sales agreement or a
prolonged force majeure event affecting the customer, including damage to or destruction of relevant facilities, war or political unrest
preventing us from performing services for that customer; or
• the customer becomes subject to applicable sanctions laws which prohibit our ability to lawfully charter our vessel to or receive payment from
such customer.
Two of the six MALT LNG Carriers in our 52%-owned MALT Joint Venture, the Seapeak Marib and Seapeak Arwa, were chartered-out to Yemen
LNG under long-term charter contracts with YLNG. However, due to the political unrest in Yemen, YLNG decided to temporarily close operation of
its LNG plant in Yemen in 2015. As a result, commencing January 1, 2016, the MALT Joint Venture agreed to successive deferral arrangements
with YLNG pursuant to which a portion of the charter payments was deferred. Subsequently, YLNG approved the sub-chartering of the Seapeak
Marib and the Seapeak Arwa by the MALT Joint Venture. In March 2025, the MALT Joint Venture entered into a third suspension agreement with
YLNG (or the Third Suspension Agreement) to further suspend the charter contracts of the Seapeak Marib and the Seapeak Arwa for up to an
additional three years until March and April 2028, respectively.
If we lose a key LNG time-charter, we may be unable to redeploy the related vessel on terms as favorable to us due to the long-term nature of most
LNG time-charters and fluctuations in the LNG spot market. If we are unable to redeploy 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.
The loss of certain 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 cash distributions to our preferred unitholders.
Financing agreements containing operating and financial restrictions may restrict our business and financing activities.
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 pursue and expand our business activities. For example, these financing arrangements
may restrict our ability to:
12
• incur or guarantee indebtedness;
• change ownership or structure, including mergers, consolidations, liquidations and dissolutions;
• make dividends or distributions when in default of the relevant loans;
• make certain negative pledges and grant certain liens;
• sell, transfer, assign or convey assets;
• make certain investments; and
• enter into new lines of business.
Some of our financing arrangements require us to maintain a minimum level of tangible net worth, to maintain certain ratios of vessel values as it
relates to the relevant outstanding principal balance, to maintain a minimum level of aggregate liquidity, to maintain leverage below a maximum
level and require certain of our subsidiaries to maintain restricted cash deposits. Please read "Item 5 – Operating and Financial Review and
Prospects: Liquidity and Capital Resources." Our ability to comply with covenants and restrictions contained in our financing agreements may be
affected by events beyond our control, including prevailing economic, financial and industry conditions, and in certain cases the ability of our joint
venture partners to comply with applicable laws and regulations (including business corruption and sanctions regulations). If any such events were
to occur, compliance with these covenants may be impaired. If restrictions, covenants, ratios or tests in the financing agreements are breached, and
we are unable to cure such breach within the prescribed cure period, a significant portion or all of the obligations may, at the election of the relevant
lender, become immediately due and payable, and the lenders’ commitment to make further loans available to us may terminate. In certain
circumstances, this could lead to cross-defaults under other financing agreements which in turn could result in obligations becoming due and
commitments being terminated under such agreements. A default under financing agreements could also result in foreclosure on any of our vessels
and other assets securing related loans and finance leases or our need to sell assets or take other actions in order to meet our debt obligations.
Furthermore, the termination of any of our charter contracts by our customers could result in the repayment of our financing agreements to which
the chartered vessels relate.
Any capital expenditures, including as a result of pursuing future fleet expansion opportunities, may impact our liquidity position. 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 cash distributions to our preferred unitholders.
We make substantial capital expenditures to maintain and expand our fleet or business, including capital expenditures associated with drydocking
vessels, modifying existing vessels, and acquiring secondhand or newbuilding vessels. We currently have on order seven LNG carrier newbuilding
vessels that are scheduled for deliveries throughout 2027 and 2028. In addition, we have seven LPG carrier newbuilding vessels that are scheduled
for deliveries in 2026 through our 50/50 NGL-related joint venture with Exmar NV (or Exmar) (or the Exmar LPG Joint Venture). If we bid on and are
awarded contracts relating to any LNG and NGL project, we will incur significant additional capital expenditures to build the related LNG and NGL
carriers. Obligations of us and our joint ventures to pay committed expenditures are not conditional upon our or their ability to obtain financing for
such expenditures.
To fund any future capital expenditures, we will be required to use cash from operations or incur borrowings or raise capital through the sale of debt
or equity securities. Use of cash from operations may impact our liquidity and ability to pay distributions to preferred 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
offering 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 future capital expenditures could have a material adverse effect on our
business, results of operations and financial condition, including the possibility of defaulting under our newbuilding contracts.
In addition, although delivery of a completed vessel will not occur until much later (approximately two to three years from the time an order is
placed), we typically must pay an initial installment up-front upon signing the purchase contract. During the construction period, we generally are
required to make installment payments on newbuildings prior to their delivery, in addition to incurring financing, miscellaneous construction and
project management costs, but we do not derive any income from the vessel until after its delivery.
Delays in deliveries of newbuildings or in potential conversions or upgrades of existing vessels could harm our operating results and
lead to the termination of related charters.
The delivery of newbuildings or potential vessel conversions or upgrades we may order or undertake or otherwise acquire, could be delayed, which
would delay our receipt of revenues under the charters for the vessels. In addition, under some of our charters if delivery of a vessel to our
customer is delayed, we may be required to pay liquidated damages under some charters. 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.
Our receipt of newbuildings or of potential vessel conversions or upgrades could be delayed because of:
• work stoppages or other labor disturbances at the shipyard, including as a result of pandemics or other global events that affect the supply of
labor;
• bankruptcy or other financial crisis of the shipbuilder;
• market conditions, including a backlog of orders at the shipyard;
• political or economic disturbances where our vessels are being or may be built;
• weather interference or catastrophic event, such as a major earthquake or fire;
13
• our requests for changes to the original vessel specification;
• shortages of or delays in the receipt of necessary construction materials, such as steel;
• our inability to pay for the construction milestone payments, including as a result of our inability to finance the purchase or construction of the
vessels; or
• changes in governmental regulations or maritime self-regulatory organization standards.
If delivery of a vessel is materially delayed, it could adversely affect our results or operations and financial condition and our ability to make cash
distributions.
Our substantial debt levels may limit our flexibility in obtaining additional financing, refinancing credit facilities upon maturity, and
pursuing other business opportunities.
As at December 31, 2025, our consolidated debt and obligations related to our credit facilities and finance leases totaled $2.7 billion and we had the
capacity to borrow an additional $215.0 million under our revolving credit facility. This facility may be used by us for general corporate purposes. If
we obtain debt financing for future newbuilding orders or we are awarded contracts for new LNG or NGL newbuild projects, our consolidated debt
and 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:
• 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, if at all;
• 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 and future business opportunities;
• our debt level may make us more vulnerable than our competitors with less debt to competitive pressures or a downturn in our industry or the
economy generally; and
• our debt level may limit our flexibility in responding to changing business and economic conditions.
Our ability to service our debt and obligations related to our credit facilities and finance leases depends upon, among other things, our future
financial and operating performance, which is affected by prevailing economic conditions and financial, business, regulatory and other factors, some
of which are beyond our control. Furthermore, our ability to borrow against the vessels in our existing fleet and any vessels we may acquire in the
future largely depends on the value of the vessels, which in turn depends in part on charter hire rates, charter lengths and the ability of our
charterers to comply with the terms of the charters. If our operating results are not sufficient to service our current or future indebtedness under our
financing agreements, we will be forced to take actions such as reducing distributions, reducing, canceling or delaying our business activities,
acquisitions, investments or capital expenditures, selling assets, seeking to restructure or refinance our debt, seeking additional debt or equity
capital or seeking bankruptcy protection. We may not be able to affect any of these remedies on satisfactory terms, or at all.
Restrictions in our financing agreements may prevent us from paying distributions on our preferred units.
The payment of principal and interest on our debt reduces cash available for distribution on our preferred units. In addition, our financing
agreements prohibit the payment of distributions upon the occurrence of the following events, among others:
• failure to pay any principal, interest, fees, expenses or other amounts when due;
• breach or lapse of any insurance with respect to vessels securing the facility;
• breach of certain financial covenants;
• failure to observe any other agreement, security instrument, obligation or covenant beyond specified cure periods in certain cases;
• default under other indebtedness;
• bankruptcy or insolvency events;
• failure of any representation or warranty to be materially correct;
• a change of control, as defined in the applicable agreement; or
• a material adverse effect, as defined in the applicable agreement.
We and certain of our joint venture partners may be unable to attract and retain qualified, skilled employees or crew necessary to operate
our business, or may have to pay substantially increased costs for our employees and crew.
Our success depends in large part on the ability of us and certain of our joint venture partners to attract and retain highly skilled and qualified
personnel. In crewing our vessels, we require technically skilled employees with specialized training who can perform physically demanding work.
The ability to attract and retain qualified crew members under a competitive industry environment continues to put upward pressure on crew
manning costs.
If we are not able to increase our charter rates to compensate for any crew cost increases, our financial condition and results of operations may be
adversely affected. Any inability we experience in the future to hire, train and retain a sufficient number of qualified employees could impair our
ability to manage, maintain and grow our business.
14
Changes in the NGL markets could result in decreased demand for our NGL vessels operating in the spot market.
Our NGL carriers that operate in the NGL spot market are owned or chartered-in by the Exmar LPG Joint Venture that owns and charters-in NGL
carriers with a primary focus on the mid-size NGL carrier segment. The charters in the spot market operate for short durations and are priced on a
current, or “spot,” market rate. The NGL spot market is volatile and fluctuates based upon the many conditions and events that affect the price,
production and transport of NGL, including, among others, competition from alternative energy sources and negative global or regional economic or
political conditions. Any adverse changes in the NGL markets may impact our ability to enter into economically beneficial charters when our NGL
carriers complete their existing short-term charters in the NGL spot market, which may reduce vessel earnings and impact our operating results.
Our growth depends on our ability to expand relationships with existing customers and obtain new customers, for which we will face
substantial competition.
One of our principal objectives is to enter into long-term, fixed-rate LNG and NGL time-charters. The process of obtaining new long-term charters is
highly competitive and generally involves an intensive screening process and competitive bids, and often extends for several months. Shipping
contracts are awarded based upon a variety of factors relating to the vessel operator, including:
• size, age, technical specifications and condition of the vessel;
• shipping industry relationships and reputation for customer service and safety;
• shipping experience and quality of ship operations (including cost effectiveness);
• operational reliability and performance capabilities of the vessel;
• quality and experience of seafaring crew;
• safety record;
• the ability to finance vessels at competitive rates and financial stability generally;
• relationships with shipyards and the ability to get suitable berths;
• construction management experience, including the ability to obtain on-time delivery of new vessels according to customer specifications;
• willingness to accept operational risks pursuant to the charter, such as allowing termination of the charter for prolonged off-hire; and
• competitiveness of the bid in terms of overall price.
We compete for providing marine transportation services for potential energy projects with a number of experienced companies, including state-
sponsored entities and major energy companies affiliated with the energy project requiring energy shipping services. Many of these competitors
have significantly greater financial resources than we do. We anticipate that an increasing number of marine transportation companies – including
many with strong reputations and extensive resources and experience – will enter the energy 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 could have a material adverse effect on our business, results of
operations and financial condition.
We have recognized asset impairments in the past and we may recognize additional impairments in the future, which will reduce our
earnings and net assets.
If we determine at any time that an asset has been impaired, we may need to recognize an impairment charge that will reduce our earnings and net
assets. We review our vessels for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may
not be recoverable, which occurs when an asset's carrying value is greater than the estimated undiscounted future cash flows the asset is expected
to generate over its remaining useful life. We review our goodwill for impairment annually and if a reporting unit's goodwill carrying value is greater
than the estimated fair value, the goodwill attributable to that reporting unit is impaired. We evaluate our investments in equity-accounted joint
ventures for impairment when events or circumstances indicate that the carrying value of such investment may have experienced an other-than-
temporary decline in value below its carrying value.
During 2023, we recognized total write-downs of vessels of $15.5 million. During 2024, we recognized total write-downs of certain LNG vessels of
$387.1 million. During 2025, we recognized total write-downs of certain LNG vessels of $67.2 million. For information about these write-downs,
please read "Item 5 – Operating and Financial Review and Prospects: Management's Discussion and Analysis of Financial Condition and Results of
Operations – Year Ended December 31, 2025 versus Year Ended December 31, 2024" and "Item 18 – Financial Statements: Note 18 – (Write-
down) Gain and (Loss) Gain on Sales of Vessels."
Increased technological innovation in vessel design or equipment could reduce the competitive capability of certain of our vessels, our
charter hire rates and the value of vessels.
The charter hire rates and the value and operational life of a vessel are determined by a number of factors, including the vessel’s efficiency,
operational flexibility and physical life. Efficiency includes speed, fuel economy, boil-off ratio and reliquefaction capabilities (in the case of LNG
vessels), and the ability for LNG or NGL cargo to be loaded and unloaded quickly. More efficient vessel designs, engines or other features may
increase overall vessel efficiency. Flexibility includes the ability to access LNG and NGL storage facilities, utilize related docking facilities and pass
through canals and straits. Physical life is related to the original design and construction, maintenance and the impact of the stress of operations. If
new LNG or NGL carriers are built that are more efficient or flexible or have longer physical lives than our vessels, competition from these more
technologically advanced LNG or NGL carriers could reduce recharter rates available to our vessels and the resale value of the vessels. As a result,
our business, results of operations and financial condition could be harmed.
15
Actual results of new vessel technologies or upgrades may differ from expected results and affect our results of operations.
We have invested and are investing in vessel technology upgrades such as M-type, Electronically Controlled, Gas Injection (or MEGI) engines, M-
type, Electronically Controlled, Gas Admission (or MEGA) engines, low-pressure dual-fuel (or XDF) engines, ammonia-fueled engines via our
Exmar LPG Joint Venture, and other equipment and designs, including, among other things, to improve fuel efficiency, vessel performance and
emissions reductions. These new engine designs and other equipment may not perform to expectations during actual operations, which may result
in our exposure to performance claims based on failure to achieve specified performance requirements included in certain charter party
agreements. As a result, our business, results of operations and financial condition could be harmed.
We or our joint venture partners may be unable to operate an LNG receiving and regasification terminal and may be exposed from time to
time to conditions, developments, or requirements that may adversely affect us or our joint venture.
We have a 30% ownership interest in an LNG regasification and receiving terminal in Bahrain (please read “Item 18 – Financial Statements: Note
7a(ii) – Equity-Accounted Joint Ventures”). The development, construction and operation of large-scale energy and regasification projects, such as
the Bahrain terminal, are inherently subject to unforeseen conditions or developments. Such conditions or developments may include, among
others: shortages or delays in deliveries of equipment, materials or labor; significant cost over-runs; labor disruptions; government issues;
regulatory changes; legal disputes with third-parties, including contractors, sub-contractors and customers; investigations involving various
authorities; adverse weather conditions; unanticipated increases in equipment, material or labor costs; reductions in access to financing, an
increase in the amount of required support from shareholders of the Bahrain LNG Joint Venture under the terms of the financing, the ability to
comply with all conditions and requirements under the terms of the financing, and the ability to obtain any applicable waivers or consents from our
lenders on a timely basis or at all; unforeseen engineering, technical and technological design, environmental, infrastructure or engineering issues;
the inability to operate the Bahrain terminal at its full designed capacity; a temporary shutdown of the Bahrain terminal; and a general inability to
realize the anticipated benefits of the Bahrain terminal, including all the benefits associated with the long-term contract with the customer. In the
event that one or more of these conditions or developments were to materialize or continue for a prolonged period (in particular, any legal disputes
with third parties or the Bahrain LNG Joint Venture’s inability to comply with all conditions and requirements under the terms of its financing or
obtain any applicable waivers or consents from its lenders under the terms of its financing), our business, results of operations and financial
condition could be harmed.
We may be unable to make or realize expected benefits from acquisitions, and implementing our strategy through acquisitions may harm
our business, financial condition and operating results.
Part of our strategy includes acquiring existing LNG and NGL carriers or LNG and NGL shipping businesses as the opportunities arise. Historically,
there have been very few purchases of existing vessels and businesses in the LNG and NGL shipping industries. Factors that may contribute to a
limited number of acquisition opportunities in the LNG and NGL shipping industries in the near term include the relatively small number of
independent LNG and NGL fleet owners and the limited number of LNG and NGL 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. 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’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.
In October 2024, we acquired a 100% interest in a 2021-built, 174,000-cubic meter dual-fueled LNG carrier, the Marvel Swan.
Our acquisition of the Marvel Swan, along with any other acquisitions by us of a vessel or business, may not be profitable to us at or after the time
we acquire them and may not generate cash flow sufficient to justify our investment. In addition, acquisitions may expose us to risks that may harm
our business, financial condition and operating results, including risks that we may:
• fail to realize anticipated benefits, such as new customer relationships, successful integration, cost-savings or cash flow enhancements;
• be unable to hire, train or retain qualified shore and seafaring personnel to manage and operate our growing business and fleet;
• decrease our liquidity by using a significant portion of our available cash or borrowing capacity to finance acquisitions;
• significantly increase our interest expense or financial leverage if we incur additional debt to finance acquisitions;
• incur or assume unanticipated liabilities, losses or costs associated with the business or vessels acquired; or
• incur other significant charges, such as impairment of goodwill or other intangible assets, asset devaluation or restructuring charges.
Our insurance may not be sufficient to cover losses that may occur to our property or result from our operations.
The operation of LNG and NGL carriers, and LNG facilities, is inherently risky. Although we carry hull and machinery (marine and war risks) and
protection and indemnity insurance, and other liability insurance, all risks may not be adequately insured against, and any particular claim may not
be paid or paid in full. In addition, only certain of our LNG and NGL carriers carry loss of hire insurance covering the loss of revenues resulting from
vessel off-hire time due to our assessment of the cost of the insurance relative to our off-hire experience. Any significant off-hire time of our vessels
could harm our business, operating results and financial condition. Any claims relating to our operations covered by insurance are 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. In addition, the
cost of this protection and indemnity coverage has significantly increased and may continue to increase. Even if our insurance coverage is
adequate to cover our losses, we may not be able to obtain a timely replacement vessel in the event of a total loss of a vessel.
16
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, marine disaster or natural disasters could result in losses that exceed our
insurance 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 regulatory organizations.
Changes in the insurance markets attributable to structural changes in insurance markets, economic factors, sanctions (particularly those relating to
Russia), outbreaks of communicable diseases, war, terrorist attacks, environmental catastrophes, or political change 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 or be available with restrictive terms.
Sanctions against key participants in the Yamal LNG Project could impede performance of the Yamal LNG Project, which could have a
material adverse effect on us.
In 2014, the U.S. Treasury Department’s Office of Foreign Assets Control (or OFAC) placed Russia-based Novatek, a 50.1% owner of the Yamal
LNG Project, on the Sectoral Sanctions Identifications List. OFAC also previously imposed sanctions on an investor in Novatek and these sanctions
also remain in effect. The current restrictions on Novatek prohibit U.S. persons (and their subsidiaries) from participating in debt financing
transactions of greater than 60 days maturity with Novatek and, by virtue of Novatek’s 50.1% ownership interest, the Yamal LNG Project. Since
2022, the EU has also imposed numerous sanctions on Russia. These sanctions require an EU license or authorization before a party can provide
certain technologies or technical assistance, financing, financial assistance, or brokering with regard to these technologies.
During 2025, significant sanctions on Russia were implemented. In October 2025, the EU announced that effective from January 2027, imports of
Russian LNG into the EU pursuant to long-term LNG supply contracts will be banned. In November 2025, the UK announced its intention to
implement a ban on the provision of UK maritime services and UK insurance services in connection with Russian LNG exports. These measures
could have a material adverse impact on our business, financial condition and results of operations.
In addition, OFAC, the EU, the UK and other governments or organizations may impose additional sanctions on Novatek, the Yamal LNG Project or
other project participants, which may adversely affect the Yamal LNG Project. Although we believe that we are in compliance with all applicable
sanctions, laws and regulations, and intend to maintain such compliance, the scope of these sanctions laws may be subject to change, which could
have a material adverse impact on our business, financial condition and results of operations.
The Russia-Ukraine war has resulted in further economic sanctions issued by the United States, the EU, the United Kingdom and other jurisdictions
relating to the banning of transactions with numerous Russian financial institutions, a ban on the transportation of certain types of Russian cargo
including crude oil, a ban on new investments in Russia, and numerous other trade restrictions. While uncertainty remains regarding the global
impact of the ongoing conflict in Ukraine, it is possible that such tensions and future sanctions could adversely affect our business, financial
condition, results of operation and cash flows. Furthermore, it is possible that third parties with whom we have charter contracts or other business
arrangements (including our suppliers and insurers) may be impacted by events in Russia and Ukraine, which could adversely affect our operations.
The ongoing conflict between Russia and Ukraine may result in the imposition of further economic sanctions in addition to the ones already
announced by the United States, Europe, UK and other countries, which could adversely affect our charterers and result in the suspension or early
termination of our time charter contracts with the Yamal LNG Project, which could harm our business, results of operations and financial condition.
In addition to our 50%-owned joint venture with China LNG Shipping (Holdings) Limited (or the Yamal LNG Joint Venture), participants in other
projects in which we are involved (including, with respect to such other projects, our joint venture partners, customers, and their respective
shareholders or management) may be subject to sanctions, which sanctions may have a material adverse effect on the success of those projects or
our joint ventures and, in turn, on our business, financial condition, and results of operations.
Failure, shutdown or other adverse events impacting the Yamal LNG Project may result in our inability to re-deploy the ARC7 LNG
carriers.
The charter party under the Yamal LNG Joint Venture’s time-charter contracts for the Yamal LNG Project is Yamal Trade Pte. Ltd., a wholly-owned
subsidiary of Yamal LNG, the project’s sponsor. If the Yamal LNG Project were to shutdown or face other adverse events, in either case on a
permanent or even temporary basis, we may be unable to redeploy the ARC7 LNG carriers under other time-charter contracts or may be forced to
scrap the vessels. Any such events could adversely affect our results of operations.
We assume credit risk by entering into agreements with unrated entities.
Some of our vessels are chartered to unrated entities and some of these unrated entities will use revenue generated from the sale of the shipped
gas to pay their shipping and other operating expenses, including the charter fees. The price of the gas may be subject to market fluctuations and
the LNG supply may be curtailed by start-up delays and stoppages. If the revenue generated by the charterer is insufficient to pay the charter fees,
we may be unable to realize the expected economic benefit from these charter agreements.
17
Exposure to currency exchange rate fluctuations will result in fluctuations in our cash flows and operating results.
We are paid in Euros under some of our charters, and certain 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. In addition, from time to time we may
incur certain capital expenditures relating to our vessels in Euros. If the amount of our Euro-denominated obligations exceeds our Euro-
denominated revenues, we must convert other currencies, primarily the U.S. Dollar, into Euros. An increase in the strength of the Euro relative to
the U.S. Dollar would require us to convert more U.S. Dollars to Euros to satisfy those obligations, which would cause us to have less cash
available for distribution to unitholders. In addition, if we do not have sufficient U.S. Dollars, we may be required to convert Euros into U.S. Dollars
for distributions to unitholders. An increase in the strength of the U.S. Dollar relative to the Euro could cause us to have less cash available for
distribution in this circumstance. We have entered into forward contracts to mitigate this risk.
Because we report our operating results in U.S. Dollars, changes in the value of the U.S. Dollar relative to the Euro and Norwegian Krone (or NOK)
also result in fluctuations in our reported revenues and earnings. In addition, under U.S. accounting guidelines, all non-U.S Dollar-denominated
monetary assets and liabilities such as cash and cash equivalents, accounts receivable, restricted cash, accounts payable, accrued liabilities,
amounts due to affiliates and long-term debt, 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 unrealized foreign currency exchange gains or losses each period. The primary source for
these gains and losses is our NOK-denominated bonds.
Exposure to interest rate fluctuations will result in fluctuations in our cash flows and operating results.
We are exposed to the impact of interest rate changes primarily through our variable-rate borrowings and finance lease obligations that require us
to make interest payments based on the Secured Overnight Finance Rate (or SOFR) or the Norwegian Interbank Offered Rate (or NIBOR).
Significant increases in interest rates could adversely affect our profit margins, results of operations and our ability to service our financing
agreements. In accordance with our risk management policy, we use interest rate swaps on certain of our debt and cross currency swaps on our
NOK bonds to reduce our exposure to market risk from changes in interest rates. The principal objective of these contracts is to minimize the risks
and costs associated with our floating rate debt. However, any hedging activities entered into by us may not be effective in fully mitigating our
interest rate risk from our variable rate obligations.
In addition, we are exposed to credit loss in the event of non-performance by the counterparties to the interest rate swap agreements. For further
information about our financial instruments at December 31, 2025, that are sensitive to changes in interest rates, please read "Item 11 –
Quantitative and Qualitative Disclosures About Market Risk."
If we fail to maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial
results or prevent fraud, which could harm our business and the trading price of our preferred units.
Effective internal control over financial reporting is necessary for us to provide reliable financial reports and, together with adequate disclosure
controls and procedures, are designed to prevent fraud. Any failure to implement required new or improved controls, or difficulties encountered in
their implementation, could cause us to fail to meet our reporting obligations. In addition, any testing we conduct in connection with Section 404 of
the Sarbanes-Oxley Act of 2002 may reveal deficiencies in our internal controls over financial reporting that are deemed to be material weaknesses
or that may require prospective or retroactive changes to our financial statements or identify other areas for further attention or improvement.
Ineffective internal controls could also cause us to incur additional costs to improve our internal control and disclosure control systems and
procedures, which could harm our business and have a negative effect on the trading price of our securities. Financial information filed with the
SEC or otherwise made public that is inaccurate as a result of ineffective internal controls could also result in third party claims, which could be
costly to defend and have a negative impact on our business and financial condition.
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 operations.
A significant portion of our seafarers are employed under collective bargaining agreements. While some of our labor agreements have recently
been renewed, crew compensation levels under future collective bargaining agreements may exceed existing compensation levels, which would
adversely affect our results of operations and cash flows. 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.
Our directors and officers and Stonepeak and its other affiliates which have a controlling interest in us and control the appointment of
members of our Board have conflicts of interest and limited or no fiduciary duties, which may permit them to favor their own interests to
those of us or our preferred unitholders.
Stonepeak and its affiliates own all of our outstanding common units, which also permits them to appoint and remove all of our directors (other than
any single director our preferred unitholders may be permitted to elect if we are six months in arrears in paying preferred unit distributions (or a
Preferred Unit Elected Director)). Neither we nor our directors or officers nor Stonepeak owe any fiduciary duties to our preferred unitholders, other
than an implied contractual duty of good faith and fair dealing pursuant to our operating agreement. Three of our directors currently also serve as
employees, officers and/or directors of Stonepeak or its other affiliates. In addition, one of our directors is also a member of our management and
therefore is considered to be non-independent. Consequently, these directors may encounter situations in which their fiduciary obligations to
Stonepeak or its other affiliates, on the one hand, and any obligation to us or our preferred unitholders, on the other hand, are in conflict. The
resolution of these conflicts may not always be in the best interest of us or our preferred unitholders. These conflicts include, among others, the
following situations:
18
• neither our operating agreement nor any other agreement requires Stonepeak or its affiliates to pursue a business strategy that favors us or
utilizes our assets, and directors and officers of Stonepeak and its other affiliates have fiduciary duties to make decisions in the best interests
of the owners of Stonepeak and such other affiliates, which may be contrary to our interests;
• our Board is allowed to take into account the interests of parties other than us, such as Stonepeak and its other affiliates, in resolving conflicts
of interest, which has the effect of limiting any obligation to our preferred unitholders;
• our operating agreement limits the liability and reduces the fiduciary duties and obligations of our directors and officers under the laws of the
Republic of the Marshall Islands, while also restricting the remedies available to our preferred unitholders, and preferred unitholders are
treated as having agreed to such modified standards and to certain actions that may be taken by our Board, all as set forth in our operating
agreement;
• our Board controls the enforcement of obligations owed to us by Stonepeak and its other affiliates; and
• our Board decides whether to retain separate counsel, accountants or others to perform services for us, which may be the same firms that
provide services to Stonepeak or other affiliates.
Except in limited circumstances, our Board, which is appointed by a common unit majority, has the power and authority to conduct our
business without approval of our preferred unitholders.
Our operating agreement provides that members of our Board (other than any Preferred Unit Elected Director) are appointed only by a common unit
majority and may be removed, with or without cause, and at any time, by a common unit majority. As a result, Stonepeak and its affiliates, which
own all our outstanding common units, are able to control the appointment and removal of members of our Board (other than any Preferred Unit
Elected Director). Under our operating agreement, our Board generally has full power and authority to do all things (other than those limited items
that require approval of our preferred unitholders or with respect to which our Board has sought Conflicts Committee approval) on such terms as it
determines to be necessary or appropriate to conduct our business including, among others, the following:
• the making of any expenditures, the lending or borrowing of money, the assumption or guarantee of, or other contracting for, indebtedness and
other liabilities, the issuance of evidences of indebtedness, including, subject to any rights of our preferred unitholders, indebtedness that is
convertible into securities of us, and the incurring of any other obligations;
• the negotiation, execution and performance of any contracts, conveyances or other instruments;
• the distribution of our cash;
• the selection and dismissal of employees and agents, outside attorneys, accountants, consultants and contractors and the determination of
their compensation and other terms of employment or hiring;
• the maintenance of insurance for our benefit and the benefit of our members;
• the formation of, or acquisition of an interest in, and the contribution of property and the making of loans to, any other limited or general
partnerships, joint ventures, corporations, limited liability companies or other relationships;
• the control of any matters affecting our rights and obligations, including the bringing and defending of actions at law or in equity and otherwise
engaging in the conduct of litigation, arbitration or mediation and the incurring of legal expense and the settlement of claims and litigation;
• the indemnification of any person against liabilities and contingencies to the extent permitted by law; and
• subject to the prior payment of all quarterly distributions on the Series A Preferred Units and Series B Preferred Units through the most recent
applicable distribution payment dates, the purchase, sale or other acquisition or disposition of our securities or, subject to any rights of our
preferred unitholders, the issuance of additional securities of us and of options, rights, warrants and appreciation rights relating to our
securities.
Our joint venture arrangements impose obligations upon us but in certain circumstances limit our control of the joint ventures, which
may affect our ability to achieve our joint venture objectives.
For financial or strategic reasons, we conduct a portion of our business through joint ventures. Generally, we are obligated to provide proportionate
financial support for the joint ventures although our control of the business entity may be substantially limited. Due to this limited control, we
generally have less flexibility to pursue our own objectives through joint ventures or to access available cash of the joint ventures than we would
with our own subsidiaries. There is no assurance that our joint venture partners will continue their relationships with us in the future or that we will
be able to achieve our financial or strategic objectives relating to the joint ventures and the markets in which they operate. In addition, our joint
venture partners may have business objectives that are inconsistent with ours, experience financial and other difficulties (including under relevant
sanctions and anti-bribery and corruption laws) that may affect the success of the joint venture or be unable or unwilling to fulfill their obligations
under the joint ventures, which may affect our financial condition or results of operations. In addition, we do not have control over the operations of,
nor do we have any legal claim to the revenues and expenses of our equity-accounted investments. Consequently, the cash flow generated by our
equity-accounted investments may not be available for use by us in the period that such cash flows are generated, if at all.
19
Legal and Regulatory Risks
Climate change and GHG restrictions may adversely impact our operations and markets.
An increasing concern for, and focus on, climate change has promoted extensive existing and proposed international, national and local regulations
intended to reduce GHG emissions (including from various countries and the International Maritime Organization (or IMO)). These regulatory
measures may include the adoption of cap and trade regimes, carbon taxes, increased efficiency standards and incentives or mandates for
renewable energy. Compliance with these or other regulations and our efforts to participate in reducing GHG emissions have increased and likely
will continue to increase our compliance costs, require additional capital expenditures to reduce vessel emissions and may require changes to our
business.
A GHG emission trading system is now in effect in the European Union and other countries such as the UK are bringing similar emission taxation
schemes. The EU is also promoting the use of renewable or low carbon fuels by penalizing operators of vessels that do not improve the GHG
intensity of their ships based on their total emissions in 2020. This scheme is known as Fuel EU. The IMO did agree to a similar scheme, known as
the Net-Zero framework but failed to agree on its implementation when a vote was held in October 2025. The future of this scheme is unclear.  Even
if the IMO do not agree to implement the Net-Zero framework now, it may come into effect at a later time. The IMO can also decide to enforce
stricter energy efficiency existing ship index (or EEXI) for current vessels. For newbuilds, a stricter energy efficiency design index (or EEDI) could
also be applied. The risk to ship owners is that older, less fuel-efficient vessels may become less attractive to charterers as they will face higher
emission taxes to carry their cargos compared to newer and more modern vessels.
Our business includes transporting LNG and NGL. Regulatory changes and growing public concern about the environmental impact of climate
change may lead to reduced demand for hydrocarbon products and decreased demand for our services, while increasing or creating greater
incentives for use of alternative energy sources. We expect regulatory and consumer efforts aimed at combating climate change to intensify and
accelerate. Although we do not expect demand for oil and gas to decline dramatically over the short-term, in the long-term, climate change
initiatives will likely significantly affect demand for oil and gas and for alternatives. Any such change could adversely affect our ability to compete in
a changing market and our business, financial condition and results of operations.
Scrutiny and expectations from certain investors, lenders, customers and other market participants with respect to ESG policies and
practices may impose additional costs on us or expose us to additional risks.
Certain investor advocacy groups, institutional investors, investment funds, lenders and other market participants remain focused on ESG practices
and place significant importance on the implications and social cost of their investments. This increased focus and activism related to ESG and
similar matters may hinder access to capital, as these investors and lenders may decide to reallocate capital or to not commit capital as a result of
their assessment of a company’s ESG practices. Companies that do not adapt to or comply with ESG expectations and standards by these
investors, lenders or other industry shareholders may lack support of such third parties.
We may face increasing pressures from such third parties and others, which are increasingly focused on climate change, to prioritize sustainable
energy practices, reduce our carbon footprint and promote sustainability. As a result, we may determine it is appropriate to implement more
stringent ESG procedures or standards so that interested existing and future investors and our lenders remain invested in us and make further
investments in us, or in order for customers to consider conducting future business with us, especially given our business of transporting LNG and
NGL. In addition, it is likely we will incur additional costs and require additional resources to monitor, report and comply with wide-ranging ESG
requirements. The occurrence of any of the foregoing could have a material adverse effect on our business, financial condition and results of
operations.
The marine energy transportation industry is subject to substantial environmental and other regulations, which may significantly limit
our operations or increase our expenses.
Our operations are affected by extensive and changing international, national and local environmental protection laws, regulations, treaties and
conventions which are in force in international waters, the jurisdictional waters of the countries in which our vessels operate, as well as the
countries of our vessels’ registration, including those governing oil spills, discharges to air and water, and the handling and disposal of hazardous
substances and wastes. Many of these requirements are designed to reduce the risk of oil spills and other pollution. In addition, we believe that the
heightened environmental, quality and security concerns of insurance underwriters, regulators and charterers will lead to additional regulatory
requirements, including enhanced risk assessment and security requirements and greater inspection and safety requirements on vessels. For
example, new or amended legislation relating to ship recycling, sewage systems, emission control (including emissions of GHGs and other
pollutants) as well as ballast water treatment and ballast water handling may be adopted. The IMO has also established progressive standards
limiting emissions from ships starting from 2023 towards 2030 and 2050 goals. These and other laws or regulations may require significant
additional capital expenditures or operating expenses in order for us to comply with the laws and regulations and maintain our vessels in
compliance with international and national regulations. In addition, the higher emissions of our steam vessels relative to more modern vessels could
make it more difficult to secure employment for these vessels and reduce the rates at which we can charter these vessels to its customers.
The environmental and other laws and regulations applicable to us can affect the future charter rates, resale value or useful lives of our vessels,
require a reduction in cargo capacity, ship modifications or operational changes or restrictions, lead to decreased availability of insurance coverage
for environmental matters or result in the denial of access to certain jurisdictional waters or ports, or detention in certain ports. Under local, national
and foreign laws, as well as international treaties and conventions, we could incur material liabilities, including cleanup obligations, in the event that
there is a release of petroleum or other hazardous substances from our vessels or otherwise in connection with our operations. We could also
become subject to personal injury or property damage claims relating to the release of or exposure to hazardous materials associated with our
operations. 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, including, in certain instances, seizure or detention of our vessels.
20
Failure to comply with the U.S. Foreign Corrupt Practices Act, the UK Bribery Act, the UK's Criminal Finances Act and other anti-bribery
or anti-money laundering legislation in other jurisdictions could result in fines, criminal penalties, contract terminations and an adverse
effect on our business.
We operate our vessels worldwide, which may require our vessels to trade in countries known to have a reputation for corruption. We are
committed to doing business in accordance with applicable anti-corruption laws and have adopted a code of business conduct and ethics which is
consistent and in full compliance with the U.S. Foreign Corrupt Practices Act of 1977 (or the FCPA), the Bribery Act 2010 of the United Kingdom (or
the UK Bribery Act) and the Criminal Finances Act 2017 of the United Kingdom (or the CFA). We are subject, however, to the risk that we, our
customers, our joint venture partners, our affiliated entities or our or their respective officers, directors, employees and agents may take actions
determined to be in violation of such anti-corruption and anti-money laundering laws, including the FCPA, the UK Bribery Act and the CFA. Any such
violation could result in substantial fines, sanctions, civil and/or criminal penalties, or curtailment of operations in certain jurisdictions, and might
adversely affect our business, results of operations or financial condition. In addition, actual or alleged violations could damage our reputation and
ability to do business. Furthermore, detecting, investigating, and resolving actual or alleged violations is expensive and can consume significant
time and attention of our senior management.
With a majority of our subsidiaries being Marshall Islands entities and also having subsidiaries in other offshore jurisdictions, our
operations may be subject to economic substance requirements, which could impact our business, financial condition and operating
results.
Finance ministers of the EU rate jurisdictions for tax transparency, governance, real economic activity and corporate tax rate. Countries that do not
adequately cooperate with the finance ministers are put on a “grey list” or a “black list”. Bermuda and the Marshall Islands were removed from the
black list in May and October 2019, respectively and "white-listed" by the EU in February 2020.  On February 24, 2022, Bermuda was put on the
"grey list" and was moved back to the "white list" on October 25, 2022. On February 14, 2023, the Marshall Islands was placed back on the "black
list" but was moved back to the "white list" on October 24, 2023.
EU member states have agreed upon a set of measures, which they can choose to apply against the grey or black listed countries, including
increased monitoring and audits, withholding taxes, special documentation requirements and anti-abuse provisions. The European Commission has
stated it will continue to support member states' efforts to develop a more coordinated approach to sanctions for the listed countries. EU legislation
prohibits EU funds from being channeled or transited through entities in countries on the "black list". The effect of the EU "black list" could have
material adverse effects on our business, financial condition and operating results.
A majority of our subsidiaries are Marshall Islands entities and one of our subsidiaries is organized and registered in Bermuda. These jurisdictions
have enacted economic substance laws and regulations with which we may be obligated to comply. We believe that we and our subsidiaries are
compliant with the Bermuda and the Marshall Islands economic substance requirements and do not currently expect that these requirements will
have a material adverse effect on our business, financial condition and operating results. However, if there were a change in the requirements or
interpretation thereof, or if there were an unexpected change to our operations, any such change could result in noncompliance with the economic
substance legislation and related fines or other penalties, increased monitoring and audits, and dissolution of the noncompliant entity, which could
have an adverse effect on our business, financial condition and operating results.
Information and Technology Risks
A cyber-attack could materially disrupt our business.
We rely on information technology systems and networks in our operations and the administration of our business, including for processing,
transmitting and storing electronic and financial information, and aspects of the control and operation of our vessels, such as shore-to-vessel
communications. Security breaches and other attacks by computer hackers and cyber terrorists have increased in number and sophistication in
recent years, and such changes likely will accelerate as artificial intelligence (or AI) is further employed in cyber-attacks. Our operations could be
targeted by individuals or groups seeking to sabotage or disrupt our information technology systems and networks, or to steal data. A successful
cyber-attack could materially disrupt our operations, including the safety of our operations, or lead to unauthorized release of information or
alteration of information on our systems. Any such attack or other breaches of our information technology systems could have a material adverse
effect on our business and results of operations.
We may be required to spend significant capital and other resources to further protect us, our information systems and our assets against threats of
security breaches, computer viruses and cyberattacks, or to alleviate or resolve problems caused by such matters. Security breaches, viruses and
cyberattacks could also harm our reputation and expose us to claims, litigation and other possible liabilities. Any inability to prevent or mitigate the
impact of security breaches (including the inability of our third-party vendors, suppliers or counterparties to prevent security breaches) could also
cause our customers to lose confidence in our information systems and harm our reputation, cause losses to us or our customers, damage our
brand, and increase our costs.
Our failure to comply with data privacy laws could damage our customer relationships and expose us to litigation risks and potential
fines.
Data privacy is subject to frequently changing rules and regulations, which sometimes conflict among the various jurisdictions and countries in
which we provide services and continue to develop in ways which we cannot predict, including with respect to evolving technologies such as cloud
computing. The EU has adopted the General Data Privacy Regulation (or the GDPR), a comprehensive legal framework to govern data collection,
processing, use, transfer and sharing and related consumer privacy rights which took effect in May 2018 and the People’s Republic of China
adopted the Personal Information Protection Law, containing similar provisions, which took effect in November 2021. These and other privacy laws
include significant penalties for non-compliance. Our failure to adhere to or successfully implement processes in response to changing regulatory
requirements in this area could result in legal liability or impairment to our reputation in the marketplace, which could have a material adverse effect
on our business, financial condition and results of operations.
21
Use of artificial intelligence presents risks and challenges that could impact our business.
The use of AI presents risks and challenges that could adversely affect our business. Our AI strategy focuses on addressing key challenges and
seizing emerging opportunities to enhance operational and employee efficiency, reduce costs, and support AI-driven growth. However, we currently
have not implemented AI applications or tools that we expect would have any material effect on our business. As a result, our business may be less
efficiently operated than our competitors’ businesses to the extent they are using AI applications or tools more extensively or effectively than us,
which competitive disadvantage could have a material adverse effect on our business.
In addition, our customers, vendors and charter counterparties may incorporate AI applications and tools into their operations without disclosing this
to us, and the providers of these AI tools may not meet existing or rapidly evolving regulatory or industry standards with respect to security, privacy,
and data protection. In addition, any vulnerabilities attributable to third-party vendors, suppliers or counterparties relating to AI applications or tools
we may purchase or use might not be identified or discovered by them or by us. If we or our customers, vendors or charter counterparties
experience a privacy or security incident because of the use of AI, we could lose confidential information or our information technology systems
could otherwise be compromised, which could result in our being subject to legal claims and action and could damage our reputation. To seek to
mitigate these risks, we have put in place an internal program of AI governance, training, and education.
Risks Related to an Investment in Our Securities
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.
We are organized under the laws of the Marshall Islands, and all of our assets are located outside of the United States. In addition, certain of our
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 to bring an action against us or against these individuals in the United States. Even if
successful in bringing an action of this kind, the laws of the Marshall Islands and of other jurisdictions may prevent or restrict the enforcement of a
judgment against us or our assets or the assets of our directors and officers.
Holders of our preferred units have extremely limited voting rights.
Holders of our preferred units generally have no voting rights. However, if and whenever distributions payable on a series of preferred units are in
arrears for six or more quarterly periods, whether or not consecutive, holders of such series of preferred units (voting together as a class with all
other classes or series of parity securities upon which like voting rights have been conferred and are exercisable) will be entitled to elect one
additional director to serve on our board of directors, and the size of our board of directors will be increased as needed to accommodate such
change.
Our preferred units have not been rated, and ratings of any other of our securities may affect the trading price of the preferred units.
We have not sought to obtain a rating for any series of our preferred units and the units may never be rated. It is possible, however, that one or
more rating agencies might independently determine to assign a rating to our preferred units or that we may elect to obtain a rating in the future. In
addition, we may elect to issue other securities for which we may seek to obtain a rating. If any ratings are assigned to a series of preferred units in
the future or if we issue other securities with a rating, such ratings, if they are lower than market expectations or are subsequently lowered or
withdrawn, or if ratings for such other securities would imply a lower relative value for the preferred units, could adversely affect the market for, or
the market value of, the preferred units. Ratings only reflect the views of the issuing rating agency or agencies and such ratings could at any time
be revised downward or withdrawn entirely at the discretion of the issuing rating agency. A rating is not a recommendation to purchase, sell or hold
any particular security.
Market interest rates may adversely affect the value of our preferred units.
One of the factors that will influence the trading price of our preferred units will be the distribution yield on the preferred units relative to market
interest rates. In response to high levels of inflation, interest rates rose globally in 2022 and 2023, before moderating in recent years. An increase in
market interest rates may lead prospective purchasers of our preferred units to expect higher distribution yields, and higher interest rates would
likely increase our borrowing costs and potentially decrease funds available for distributions. Accordingly, higher market interest rates could cause
the market price of our preferred units to decrease.
Our preferred units represent perpetual equity interests in us.
Our Series A and Series B Preferred Units represent perpetual equity interests in us and, unlike our indebtedness, will not give rise to a claim for
payment of a principal amount at a particular date. As a result, holders of our preferred units may be required to bear the financial risks of an
investment in our preferred units for an indefinite period of time. In addition, our Series A and Series B Preferred Units rank junior to all our
indebtedness and other liabilities, and will rank junior to any other senior securities we may issue in the future, with respect to assets available to
satisfy claims against us.
22
Our Series A Preferred Units are redeemable at our option, and our Series B Preferred Units will become redeemable at our option.
We may, at our option, redeem all or, from time to time, part of the Series A Preferred Units at any time, and the Series B Preferred Units on or after
October 15, 2027. The preferred units have no maturity or mandatory redemption date and are not redeemable at the option of the preferred
unitholders under any circumstances. If we redeem such preferred units, redeemed unitholders will be entitled to receive a redemption price equal
to $25.00 per unit plus accumulated and unpaid distributions to the date of redemption. In addition, we may choose to repurchase Series A
Preferred Units and Series B Preferred Units in the open market or in privately-negotiated transactions from time to time. Please refer to and read
“Item 16E – Purchases of Units by the Issuer and Affiliated Purchasers” for details of our current repurchase plan. Any reduction in the number of
outstanding Series A or Series B Preferred Units could adversely affect the liquidity or market value of, or the market for, the preferred units and of
such series.
Tax Risks
In addition to the following risk factors, you should read "Item 4E – Taxation of the Company", "Item 10 – Additional Information – Material United
States Federal Income Tax Considerations" and “Item 10 – Additional Information – Non-United States Tax Considerations" for a more complete
discussion of the expected material U.S. federal and non-U.S. income tax considerations relating to us and the ownership and disposition of our
units.
U.S. tax authorities could treat us as a PFIC which could have adverse U.S. federal income tax consequences to U.S. holders.
A non-U.S. entity treated as a corporation for U.S. federal income tax purposes will be treated as a PFIC for such purposes in any taxable year in
which, after taking into account the income and assets of the corporation and, pursuant to a “look-through” rule, any other corporation or partnership
in which the corporation directly or indirectly owns at least 25% of the stock or equity interests (by value) and any partnership in which the
corporation directly or indirectly owns less than 25% of the equity interests (by value) to the extent the corporation satisfies an "active partner" test
and does not elect out of "look through" treatment, either (i) at least 75% of its gross income consists of “passive income,” or (ii) at least 50% of the
average value of the entity’s assets is attributable to assets that produce or are held for the production of “passive income.” For purposes of these
tests, “passive income” includes dividends, interest, gains from the sale or exchange of investment property and rents and royalties (other than
rents and royalties that are received from unrelated parties in connection with the active conduct of a trade or business). By contrast, income
derived from the performance of services does not constitute “passive income”.
There are legal uncertainties involved in determining whether the income derived from our and our look-through subsidiaries' time-chartering
activities constitutes rental income or income derived from the performance of services, including the decision in Tidewater Inc. v. United States,
565 F.3d 299 (5th Cir. 2009), which held that income derived from certain time-chartering activities should be treated as rental income rather than
services income for purposes of a foreign sales corporation provision of the Internal Revenue Code of 1986, as amended (or the Code). However,
the Internal Revenue Service (or the IRS ) stated in an Action on Decision (AOD 2010-01) that it disagrees with, and will not acquiesce to, the way
that the rental versus services framework was applied to the facts in the Tidewater decision, and in its discussion stated that the time charters at
issue in Tidewater would be treated as producing services income for PFIC purposes. The IRS’s statement with respect to Tidewater cannot be
relied upon or otherwise cited as precedent by taxpayers. Consequently, in the absence of any binding legal authority specifically relating to the
statutory provisions governing PFICs, there can be no assurance that the IRS or a court would not follow the Tidewater decision in interpreting the
PFIC provisions of the Code. Nevertheless, based on our and our look-through subsidiaries’ current assets and operations, we intend to take the
position that we are not now and have never been a PFIC.  No assurance can be given, however, that this position would be sustained by a court if
contested by the IRS, or that we would not constitute a PFIC for the 2026 taxable year or any future taxable year if there were to be changes in our
and our look-through subsidiaries' assets, income or operations.
If we or the IRS were to determine that we are or have been a PFIC for any taxable year during which a U.S. Holder (as defined below under "Item
10 – Additional Information: Material United States Federal Income Tax Considerations") held units, such U.S. Holder would face adverse U.S.
federal income tax consequences. For a more comprehensive discussion regarding the tax consequences to U.S. Holders if we are treated as a
PFIC, please read "Item 10 – Additional Information: Material United States Federal Income Tax Considerations – United States Federal Income
Taxation of U.S. Holders." In addition, if we or the IRS were to determine that we are or have been a PFIC, the price of our preferred units may
decline and our ability to raise capital on acceptable terms may be adversely affected.
23
We may be subject to changes in tax legislation, which could impact our liquidity position.
We or our subsidiaries (including those owned in our joint ventures) are subject to tax in certain jurisdictions in which we or our subsidiaries are
organized, own assets or have operations, which may adversely impact our liquidity position. In computing our tax obligations in these jurisdictions,
we are required to take various tax accounting and reporting positions, including in certain cases estimates, on matters that are not entirely free
from doubt and for which we may not have received rulings from the governing authorities. We cannot assure you that upon review of these
positions, the applicable authorities will agree with our positions. A successful challenge by a tax authority could result in additional tax imposed on
us or our subsidiaries, further reducing our cash available for distribution. We have established reserves in our financial statements that we believe
are adequate to cover our liability for any such additional taxes. We cannot assure you, however, that such reserves will be sufficient to cover any
additional tax liability that may be imposed on us or our subsidiaries. In addition, changes in our operations or ownership could result in additional
tax being imposed on us or on our subsidiaries in jurisdictions in which operations are conducted.  For example, with respect to our taxable year
ended in 2025, we believe that we do not satisfy the requirements of the exemption from U.S. taxation under Section 883 of the Code and therefore
our gross U.S. source income is subject to a 4% U.S. federal income tax under Section 887 of the Code (as discussed below under “Item 4E –
Taxation of the Company”). The amount of such tax will depend upon the amount of income we earn from voyages into or out of the United States,
which is not within our complete control. In addition, we and some of our subsidiaries may rely on an exemption under subsection 250(6) of the
Income Tax Act (Canada) (or the Canada Tax Act) for (i) corporations whose principal business is international shipping and that derive all or
substantially all of their revenue from international shipping, and (ii) corporations that hold eligible interests in such corporations or other eligible
entities. The exemption deems the qualifying corporations not to be resident in Canada for Canadian income tax purposes. If a corporation that
would, but for the subsection 250(6) exemption, be resident in Canada is unable to satisfy the requirements of the subsection 250(6) exemption,
that corporation would be subject to Canadian income tax on its world-wide income and dividend distributions to the corporation’s shareholders who
are non-residents of Canada would generally be subject to Canadian withholding tax. 
Additionally, tax laws, including tax rates, in the jurisdictions in which we operate may change as a result of macroeconomic or other factors outside
of our control. For example, various governments and organizations such as the EU and Organization for Economic Co-operation and Development
(or the OECD) are increasingly focused on tax reform and other legislative or regulatory action to increase tax revenue. In October 2021, members
of the OECD put forth two proposals: (i) Pillar One reallocates profit to the market jurisdictions where sales arise versus physical presence; and (ii)
Pillar Two compels multinational enterprises with €750 million or more in annual revenue to pay a global minimum tax of 15% on income received in
each country in which they operate. The reforms aim to level the playing field between countries by discouraging them from reducing their corporate
income taxes to attract foreign business investment. Over 140 countries agreed to enact the two-pillar solution to address the challenges arising
from the digitalization of the economy and, in 2024, these guidelines were declared effective and must now be enacted by those OECD member
countries. Legislatures of certain member states within the EU, as well as legislatures of multiple countries outside of the EU, in which we (or one of
our “constituent entities,” as determined consistent with the Pillar Two framework) do business have drafted or enacted legislation to implement the
OECD’s minimum tax proposal. As of 2025, legislatures of over 60 member states both within and outside of the EU have either introduced draft
legislation or enacted final legislation to implement the OECD’s minimum tax proposal, including countries in which we (or one of our “constituent
entities,” as determined consistent with the Pillar Two framework) operate. Qualifying international shipping income is exempt from many aspects of
this Pillar Two framework if the exemption requirements are met, which may minimize the tax effect on qualifying shipping companies.  If we are in
the scope of OECD’s Pillar Two rules, including due to our inability to satisfy the requirements of the international shipping exemption, these
changes could result in additional tax imposed on us or our subsidiaries, further impacting our liquidity position. The application of the Pillar Two
rules continues to evolve and its impact on us remains uncertain. We continue to evaluate the impact of these changes and assess whether to take
any available mitigating actions.
Typically, most of our charter contracts require the charterer to indemnify us in respect of taxes incurred as a consequence of the voyage activities
of our vessels, which are under the direction of the charterers. However, we, our joint ventures and our subsidiaries operate in numerous
jurisdictions which may result in various voyage-related or freight taxes being imposed. Although we are generally entitled to indemnification from
our charterers for these taxes, there is a risk that we may not be able to successfully claim an indemnity for tax liabilities which could impact our
financial condition and ability to make cash distributions.
Item 4. Information on the Company
A. Overview, History and Development
Overview and History
Seapeak LLC is an international provider of marine transportation services focusing on LNG and NGL. We were formed in 2004 for the purpose of
operating in the LNG shipping sector. Our primary strategy focuses on servicing our customers through our fleet of LNG and NGL carriers under
medium to long-term, fixed-rate charters. In executing our strategy, we may engage in vessel or business acquisitions or enter into joint ventures
and partnerships with companies that provide increased access to emerging opportunities from global expansion of the LNG and NGL sectors. We
pursue opportunities in the LNG and NGL sectors and may consider other opportunities to which our competitive strengths are well suited, including
entering into adjacent liquefied gas markets, renewable markets, and other maritime opportunities.
24
As of December 31, 2025, our fleet, excluding newbuildings, consisted of 44 LNG carriers (including 24 LNG carriers that are accounted for under
the equity method) and 28 NGL carriers (including the 18 carriers that are accounted for under the equity method). In addition, as at December 31,
2025, we had one LNG receiving and regasification terminal in Bahrain, in which we have a 30% ownership interest. Our equity-accounted LNG
carriers include (i) six LNG carriers (or the MALT LNG Carriers) relating to our 52% ownership interest in the MALT Joint Venture, (ii) four LNG
carriers (or the RasGas III LNG Carriers) relating to our joint venture with QGTC Nakilat (1643-6) Holdings Corporation in which we have a 40%
ownership interest, (iii) four LNG carriers relating to the Angola Project (or the Angola LNG Carriers) in our joint venture with Mitsui & Co., Ltd. and
NYK Energy Transport (Atlantic) Ltd. (or the Angola Joint Venture) in which we have a 33% ownership interest, (iv) four LNG carriers (or the Pan
Union LNG Carriers ), in which we have interests ranging from 20% to 30%, relating to our joint venture with China LNG, CETS Investment
Management (HK) Co. Ltd. and BW Investments Pte. Ltd, and (v) six ARC7 LNG carriers relating to the Yamal LNG Joint Venture. As of
December 31, 2025, our 18 equity-accounted NGL carriers (or the Exmar LPG Carriers) relate to our Exmar LPG Joint Venture. As at December 31,
2025, we had seven LNG carrier newbuildings that are scheduled for deliveries throughout 2027 and 2028, and 14 NGL carrier newbuildings
(including six in-chartered NGL carrier newbuildings) within the Exmar LPG Joint Venture that are scheduled for deliveries between 2026 and 2027.
Our fleets of LNG and NGL carriers (excluding newbuildings but including equity-accounted vessels) currently have approximately 7.5 million and
1.1 million cubic meters of total capacity, respectively.
On January 13, 2022, we (then known as Teekay LNG Partners L.P. (or the Partnership)) were acquired through a merger by investment vehicles
managed by Stonepeak. Pursuant to the merger and related transactions (or the Stonepeak Transaction), Stonepeak and its affiliates acquired: (1)
100% of the issued and outstanding common units of the Partnership, (2) 100% of the ownership interests of Teekay GP L.L.C., the general partner
of the Partnership (or the General Partner), and (3) certain operating subsidiaries from Teekay Corporation which provide services to the
Partnership, its subsidiaries and joint ventures.
On February 25, 2022, the Partnership converted from a limited partnership formed under the laws of the Republic of the Marshall Islands into a
limited liability company formed under the laws of the Republic of the Marshall Islands (or the Conversion). Concurrent with the Conversion, the
Partnership changed its name from "Teekay LNG Partners L.P." to "Seapeak LLC". As a result of the Conversion, Seapeak LLC no longer has a
general partner and affiliates of Stonepeak now own 100% of our limited liability company common units.
Our principal executive offices are at 2000, 550 Burrard Street, Vancouver, B.C., Canada, V6C 2K2. Our telephone number at such address is
(604) 609-4735.
The SEC maintains an internet site at www.sec.gov, that contains reports, proxy and information statements, and other information regarding
issuers that file electronically with the SEC. Our website is www.seapeak.com. The information contained on our website is not part of this Annual
Report.
B. Operations
Our Fleet and Our Charters
We generate revenues by charging customers for the transportation of their LNG and NGL using our vessels. The substantial majority of these
services are provided through time-charter contracts, where vessels are chartered to customers for fixed periods of time at rates that are generally
fixed but may contain a variable component based on inflation, interest rates or other factors.
Our vessels and our LNG regasification terminal in Bahrain primarily operate under fixed-rate contracts with major energy and utility companies. As
of December 31, 2025, the average remaining term for these contracts was approximately seven years for our LNG carriers and 13 years for our
regasification terminal and approximately two years for our NGL carriers, subject, in certain circumstances, to termination or vessel purchase rights.
“Hire” rate refers to the basic payment from the customer for the use of a vessel. Hire is payable monthly, in advance, in U.S. Dollars or Euros, as
specified in the charter. The hire rate generally includes two components – a capital cost component and an operating expense component. The
capital cost component typically approximates the amount we are required to pay under vessel financing obligations. The operating expense
component, which in certain cases adjusts annually for inflation, is intended to compensate us for vessel operating expenses.
Hire payments may be reduced or, under some charters, we must pay liquidated damages, if the vessel does not perform to certain of its
specifications, such as if the average vessel speed falls below a guaranteed speed or the amount of fuel consumed to power the vessel under
normal circumstances exceeds a guaranteed amount.
When a vessel is “off-hire” – or not available for service – the customer generally is not required to pay the hire rate and we are responsible for all
costs. Prolonged off-hire may lead to vessel substitution or termination of the time-charter. A vessel will typically be deemed to be off-hire if it is in
dry dock unless our contract specifies drydocking is not considered off-hire. We must periodically dry dock each of our vessels for inspection,
repairs and maintenance and any modifications to comply with industry certification or governmental requirements. In addition, a vessel generally
will be deemed off-hire if there is a loss of time due to, among other things: operational deficiencies; equipment breakdowns; delays due to
accidents, crewing strikes, certain vessel detentions or similar problems; or our failure to maintain the vessel in compliance with its specifications
and contractual standards or to provide the required crew.
25
Liquefied Natural Gas Segment
LNG Carriers
The LNG carriers in our liquefied natural gas segment compete in the LNG market. LNG carriers are usually chartered to carry LNG pursuant to
time-charter contracts, where a vessel is hired for a fixed period of time and the charter rate is payable to the owner on a monthly basis and in
advance. LNG shipping historically has been transacted with long-term, fixed-rate, time-charter contracts. LNG projects require significant capital
expenditures and typically involve an integrated chain of dedicated facilities and cooperative activities. Accordingly, the overall success of an LNG
project depends heavily on long-range planning and coordination of project activities, including marine transportation. Most shipping requirements
for new LNG projects continue to be provided on a long-term basis, though the levels of spot voyages (typically consisting of a single voyage),
short-term time-charters and medium-term time-charters have grown in recent years.
In the LNG market, we compete principally with other private and state-controlled energy and utilities companies that generally operate captive
fleets of owned and chartered vessels, and independent shipowners and operators. Many major energy companies compete directly with
independent owners by transporting LNG for third parties in addition to their own LNG. Given the complex, long-term nature of LNG projects, major
energy companies historically have transported LNG through their owned captive fleets. However, independent fleet operators have been obtaining
an increasing percentage of charters for new or expanded LNG projects as some major energy companies have continued to divest non-core
businesses.
LNG carriers transport LNG internationally between liquefaction facilities and import terminals. After natural gas is transported by pipeline from
production fields to a liquefaction facility, it is supercooled to a temperature of approximately negative 260 degrees Fahrenheit. This process
reduces its volume to approximately 1/600th of its volume in a gaseous state. The reduced volume facilitates economical storage and transportation
by ship over long distances, enabling countries with limited natural gas reserves or limited access to long-distance transmission pipelines to import
natural gas. LNG carriers include a sophisticated containment system that holds the LNG and provides insulation to reduce the amount of LNG that
boils off back into a vapour naturally during transit. The natural boil off is either used as fuel to power the engines on the ship or it can be reliquefied
and put back into the tanks. LNG is transported overseas in specially built tanks in double-hulled ships to a receiving terminal, where it is offloaded
and stored in insulated tanks. In regasification facilities at the receiving terminal, the LNG is returned to its gaseous state and then shipped by
pipeline for distribution to natural gas customers.
Our fleet uses two of the Gaz Transport and Technigaz (or GTT ) membrane containment systems. The GTT membrane systems are used in the
majority of LNG tankers now being constructed. Unlike the oil tanker industry, there are currently no regulations that require the phase-out from
trading of LNG carriers after they reach a certain age. As at December 31, 2025, our LNG carriers, including equity-accounted vessels, had an
average age of approximately 12 years, compared to the world LNG carrier fleet average age of approximately 10 years. In addition, as at that date,
according to Clarksons' World Fleet Monitor report published in January 2026, there were approximately 873 vessels in the world LNG fleet and
approximately 321 additional LNG carriers under construction or on order, inclusive of floating storage units and floating storage regasification units.
The following table provides additional information about the LNG carriers in our operating fleet as of December 31, 2025.
Vessel
Capacity
Delivery
Our 
Ownership
 Contract
Type
Charterer
Expiration of
Charter(1)
 
(cubic meters)
 
 
 
 
Operating LNG
carriers:
Consolidated
Seapeak Hispania(16)
137,814
2002
100%
Held for Sale
—
—
Seapeak Galicia
137,814
2004
100%
Time-charter
LNG Shipping S.P.A. (2)
Jul. 2029(3)
Seapeak Mars(14)
135,423
2004
100%
Held for Sale
—
—
Al Marrouna
149,539
2006
70%
Time-charter
Ras Laffan Liquefied
Natural Gas Company Ltd.
Oct. 2026
Al Areesh
148,786
2007
70%
Time-charter
Ras Laffan Liquefied
Natural Gas Company Ltd.
Jan. 2027
Al Daayen
148,853
2007
70%
Time-charter
Ras Laffan Liquefied
Natural Gas Company Ltd.
Feb. 2027
Tangguh Hiri
151,885
2008
70%
Time-charter
The Tangguh Production
Sharing Contractors
Dec. 2028
Tangguh Sago
155,000
2009
70%
Time-charter
The Tangguh Production
Sharing Contractors
May. 2029
Seapeak Creole
173,400
2016
100% –
Finance
lease(4)
Time-charter
China Petroleum & Chemical
Corporation
Feb. 2046
Seapeak Oak
173,400
2016
100% –
Finance
lease(4)
Time-charter
ENN LNG (Singapore) Pte. Ltd
Jun. 2032(5)
26
Vessel
Capacity
Delivery
Our 
Ownership
 Contract
Type
Charterer
Expiration of
Charter(1)
 
(cubic meters)
 
 
 
 
Macoma
173,400
2017
100% –
Finance
lease(4)
Time-charter
Shell Tankers (Singapore) Private
Ltd.
Oct. 2026
Murex
173,400
2017
100% –
Finance
lease(4)
Time-charter
Shell Tankers (Singapore) Private
Ltd.
Oct. 2027(6)
Seapeak Vancouver
173,400
2017
100% –
Finance
lease(4)
Time-charter
International energy company
Jul. 2027
Magdala
173,400
2018
100% –
Finance
lease(4)
Time-charter
Shell Tankers (Singapore) Private
Ltd.
Jan. 2026(7)
Myrina
173,400
2018
100% –
Finance
lease(4)
Time-charter
Shell Tankers (Singapore) Private
Ltd.
May. 2027(6)
Megara
173,400
2018
100% –
Finance
lease(4)
Time-charter
Shell Tankers (Singapore) Private
Ltd.
Jul. 2026
Seapeak Bahrain
173,400
2018
100%
Time-charter
Bahrain LNG W.L.L.
Feb. 2039
Seapeak Glasgow
174,000
2018
100%
Time-charter
International energy company
Jan. 2027(8)
Seapeak Yamal
174,000
2019
100% –
Finance
lease(4)
Time-charter
Yamal Trade PTE. Ltd
Jan. 2034(9)
Marvel Swan
174,000
2021
100% –
Finance
lease(4)
Time-charter
Mitsui & Co., Ltd.
Apr. 2030(10)
Equity-Accounted
Seapeak Marib
165,500
2008
52%
Time-charter
Yemen LNG Company Limited(11)
Mar. 2029(12)
Seapeak Arwa
165,500
2008
52%
Time-charter
Yemen LNG Company Limited(11)
Apr. 2029(12)
Al Huwaila
214,176
2008
40%
Time-charter
Ras Laffan Liquefied
Natural Gas Company Ltd.
May. 2033(9)
Al Shamal
213,536
2008
40%
Time-charter
Ras Laffan Liquefied
Natural Gas Company Ltd.
May. 2033(9)
Al Kharsaah
214,198
2008
40%
Time-charter
Ras Laffan Liquefied
Natural Gas Company Ltd.
Jun. 2033(9)
Al Khuwair
213,101
2008
40%
Time-charter
Ras Laffan Liquefied
Natural Gas Company Ltd.
Jul. 2033(9)
Seapeak Methane
165,500
2008
52%
Uncontracted
(15)
—
—
Woodside Donaldson
165,500
2009
52%
Time-charter
Pluto LNG Party Limited
Apr. 2026
Seapeak Magellan
165,700
2009
52%
Time-charter
TotalEnergies Gas & Power Limited
Apr. 2026
Seapeak Meridian
165,700
2010
52%
Time-charter
Total E&P Norge AS
Nov. 2030(12)
Soyo
160,400
2011
33%
Time-charter
Angola LNG Supply Services LLC
Aug. 2031(9)
Malanje
160,400
2011
33%
Time-charter
Angola LNG Supply Services LLC
Sep. 2031(9)
Lobito
160,400
2011
33%
Time-charter
Angola LNG Supply Services LLC
Oct. 2031(9)
Cubal
160,400
2012
33%
Time-charter
Angola LNG Supply Services LLC
Jan. 2032(9)
27
Vessel
Capacity
Delivery
Our 
Ownership
 Contract
Type
Charterer
Expiration of
Charter(1)
 
(cubic meters)
 
 
 
 
Pan Asia
174,000
2017
30%
Time-charter
Methane Services Limited
Oct. 2037(13)
Pan Americas
174,000
2018
30%
Time-charter
Methane Services Limited
Jan. 2038(13)
Pan Europe
174,000
2018
20%
Time-charter
Methane Services Limited
Jul. 2038(13)
Eduard Toll
172,410
2018
50%
Time-charter
Yamal Trade PTE Ltd.
Dec. 2045(9)
Rudolf Samoylovich
172,410
2018
50%
Time-charter
Yamal Trade PTE Ltd.
Dec. 2045(9)
Pan Africa
174,000
2019
20%
Time-charter
Methane Services Limited
Jan. 2039(13)
Nikolay Yevgenov
172,410
2019
50%
Time-charter
Yamal Trade PTE Ltd.
Dec. 2045(9)
Vladimir Voronin
172,410
2019
50%
Time-charter
Yamal Trade PTE Ltd.
Dec. 2045(9)
Georgiy Ushakov
172,410
2019
50%
Time-charter
Yamal Trade PTE Ltd.
Dec. 2045(9)
Yakov Gakkel
172,410
2019
50%
Time-charter
Yamal Trade PTE Ltd.
Dec. 2045(9)
7,468,185
(1) Each of our time-charters are subject to certain termination and purchase provisions.
(2) LNG Shipping S.P.A. is a wholly-owned subsidiary of ENI S.P.A.
(3) The charterer has one option to extend the term for an additional five years.
(4) We are the lessee for these obligations related to finance leases and will be required to purchase the vessel after the end of the lease terms for a fixed
price.
(5) The charterer has one option to extend the term for an additional three years.
(6) The charterer has three remaining options to extend the term for an additional three years each.
(7) In March 2026, the vessel commenced a one year time-charter contract with an international energy company. The charterer has one option to extend
the term for an additional one year.
(8) The charterer has one option to extend the term for an additional one year.
(9) The charterer has two options to extend the term for an additional five years each.
(10) The charterer has two options to extend the term for an additional one year each.
(11) In March 2025, the MALT Joint Venture entered into a Third Suspension Agreement with YLNG to further extend the charter contracts of the Seapeak
Marib and the Seapeak Arwa for up to an additional three years until March and April 2028, respectively. As of December 31, 2025, the Seapeak Marib
and the Seapeak Arwa are on time-charter contracts with international energy companies until February 2026 and March 2026, respectively. In March
2026, the Seapeak Marib entered into a short-term time-charter contract.
(12) The charterer has three options to extend the term for one, five and five additional years, respectively.
(13) The charterer has five options to extend the term for an additional two years.
(14) On January 29, 2026, the Seapeak Mars was sold.
(15) Subsequent to December 31, 2025, the vessel entered into short-term time-charter contracts.
(16) In January 2026, the Seapeak Hispania was renamed the Seapeak Jupiter and the vessel was sold on March 16, 2026.
28
The following table provides information about our LNG carrier newbuildings as of December 31, 2025. Charters for these vessels typically
commence upon delivery of the vessels.
Vessel
Capacity
Scheduled
Delivery Date
Shipyard(1)
Our
Ownership
Charterer
Length of
Charter
 
(cubic meters)
 
 
 
 
Consolidated
Seapeak Shearwater
174,000
Mar. 2027
SHI
100%(2)
SeaRiver Maritime LLC
10 years(3)
Seapeak Osprey
174,000
May 2027
SHI
100%(2)
SeaRiver Maritime LLC
10 years(3)
Seapeak Kinabalu
174,000
Aug. 2027
SHI
100%(2)
SeaRiver Maritime LLC
10 years(3)
Seapeak Atlas
174,000
Sep. 2027
SHI
100%(2)
SeaRiver Maritime LLC
10 years(3)
Seapeak Kittiwake
174,000
Dec. 2027
SHI
100%(2)
SeaRiver Maritime LLC
10 years(3)
SHI SN Hull No. 2775
174,000
Jul. 2028
SHI
100%
U.S.-based energy company
10 years
SHI SN Hull No. 2776
174,000
Sep. 2028
SHI
100%
U.S.-based energy company
10 years
1,218,000
(1) Samsung Heavy Industries Co., Ltd.
(2) During August 2025 and October 2025, we entered into new financing arrangements pursuant to which each of the vessels will be sold to a third party
upon its delivery, subject to conditions of closing. Each of the vessels will be chartered back for a minimum period of 10 years under a bareboat charter
contract. We have options to repurchase the vessels at the end of the lease terms. For further information, please read "Item 18 – Financial Statements:
Note 5 – Chartered-In Vessels."
(3) The charterer has two options to extend the term for an additional three years each.
For our consolidated voyage revenues from LNG customers that each accounted for more than 10% of our consolidated voyage revenues, please
read “Item 18 – Financial Statements: Note 4 – Segment Reporting." The loss of any significant customer or a substantial decline in the amount of
services requested by a significant customer could harm our business, financial condition and results of operations.
Charter Expirations
We have 13 LNG carriers that are subject to time-charter contracts that are scheduled to expire between January 2026 and December 2027
(excluding extension options).
In anticipation of the scheduled expiry of these time charters, we are pursuing various opportunities relating to the vessels, which may include the
exercise of extension options, redeployment under new time charters, disposition, or other opportunities, all of which will depend on evolving market
conditions. Please refer to and read “Item 4 – Information on the Company – Liquefied Natural Gas Segment – LNG Carriers” for additional
information and the full list of scheduled expiration dates of our time-charter contracts.
Other Assets
We have a 30% ownership interest in an LNG receiving and regasification terminal in Bahrain. In addition, we provide the operation and
maintenance services to the Bahrain terminal. The Bahrain LNG Joint Venture completed the mechanical construction and commissioning of the
Bahrain terminal in late-2019 and began receiving terminal use payments in early-2020 under its agreement with BAPCO, which ends in February
2039.
Natural Gas Liquids Segment
NGL Carriers
We have defined NGL shipping as the transportation of three main categories of cargo: liquid petroleum gases, including propane, butane and
ethane; petrochemical gases, including ethylene, propylene and butadiene; and ammonia.
In the NGL market, we compete principally with independent shipowners and operators, and other private and state-controlled energy and chemical
companies that generally operate captive fleets.
29
As of December 31, 2025, our NGL carriers (including equity-accounted vessels) had an average age of approximately nine years, compared to the
world NGL carrier fleet average age of approximately 17 years. As of that date, according to Clarksons' Ship Intelligence Database, the worldwide
NGL tanker fleet consisted of approximately 1,720 vessels and approximately 314 additional NGL vessels were on order for delivery through 2030.
NGL carriers range in size from approximately 1,000 to approximately 150,000 cubic meters. Approximately 36% of the vessels in the worldwide
fleet are less than 5,000 cubic meters in size.
NGL carriers are mainly chartered to carry NGL on time-charters, contracts of affreightment or spot voyage charters. The two largest consumers of
NGL are residential users and the petrochemical industry. Residential users, particularly in developing regions where electricity and gas pipelines
are not developed, do not have fuel switching alternatives and generally are not NGL price sensitive. The petrochemical industry, however, has the
ability to switch between NGL and other feedstock fuels depending on price and availability of alternatives.
The following table provides information about our NGL carriers in our operating fleet as of December 31, 2025.
Vessel
Capacity
Delivery
Our
Ownership
Contract 
Type
Charterer
Expiration of
Charter
 
(cubic meters)
 
 
 
 
 
Operating NGL carriers:
Consolidated
Ineos Dolphin
85,000
2020
100% –
Finance
lease(1)
Time-
charter
Ineos Europe AG
Aug. 2029(5)
Ineos Marlin
85,000
2019
100% –
Finance
lease(1)
Time-
charter
Ineos Europe AG
Apr. 2029
Ineos Insight
27,500
2015
100% –
Finance
lease(1)
Time-
charter
Ineos Europe AG
Sep. 2030
Ineos Ingenuity
27,500
2015
100% –
Finance
lease(1)
Time-
charter
Ineos Europe AG
Sep. 2030
Ineos Intrepid
27,500
2015
100% –
Finance
lease(1)
Time-
charter
Ineos Europe AG
Nov. 2030
Ineos Inspiration
27,500
2016
100% –
Finance
lease(1)
Time-
charter
Ineos Europe AG
Mar. 2031
Ineos Innovation
27,500
2016
100% –
Finance
lease(1)
Time-
charter
Ineos Europe AG
Jan. 2027(2)(5)
Ineos Independence
27,500
2017
100% –
Finance
lease(1)
Time-
charter
Ineos Europe AG
Apr. 2027(2)
Ineos Invention
27,500
2017
100% –
Finance
lease(1)
Time-
charter
Ineos Europe AG
May 2027(3)
Ineos Intuition
27,500
2017
100% –
Finance
lease(1)
Time-
charter
Ineos Europe AG
May 2027(3)
Equity-Accounted
Libramont
38,455
2006
50% –
 Chartered-in
Time-
charter
An international fertilizer
company
May 2026
Sombeke
38,447
2006
50% –
 Chartered-in
Time-
charter
An international fertilizer
company
Jun. 2027
BW Tokyo
83,300
2009
50% –
 Chartered-in
Time-
charter
An international energy
company
Apr. 2028
Waasmunster
38,115
2014
50%
Time-
charter
An international energy
company
Nov. 2026
Sophie Schulte
(formerly Waregem)
38,115
2014
50% –
 Chartered-in
Time-
charter
An international fertilizer
company
Jun. 2027(6)
Severin Schulte
38,115
2014
50% –
 Chartered-in
Time-
charter
An international energy
company
Mar. 2026
Warisoulx
38,115
2015
50%
Time-
charter
An international trading
company
Jan. 2027
Kaprijke
38,500
2015
50%
Spot
An international energy
company
Nov. 2028
30
Vessel
Capacity
Delivery
Our
Ownership
Contract 
Type
Charterer
Expiration of
Charter
 
(cubic meters)
 
 
 
 
 
Knokke
38,500
2016
50%
Time-
charter
An international energy
company
Apr. 2026(9)
Kontich
38,500
2016
50%
Time-
charter
An international energy
company
Dec. 2026
Kortrijk
38,500
2016
50%
Time-
charter
An international trading
company
Feb. 2027(7)
Kallo
38,500
2017
50% –
 Finance
lease (4)
Time-
charter
An international fertilizer
company
Mar. 2026(9)
Kruibeke
38,500
2017
50% –
 Finance
lease (4)
Time-
charter
An international trading
company
Dec. 2026
Kapellen
38,500
2018
50% –
 Finance
lease (4)
Time-
charter
An international trading
company
Sep. 2026(3)
Koksijde
38,500
2018
50% –
 Finance
lease (4)
Time-
charter
An international energy
company
Dec. 2026
Wepion
38,200
2018
50%
Time-
charter
An international fertilizer
company
Nov. 2026(8)
Champagny
45,000
2025
50%
Time-
charter
An international energy
company
Feb. 2027
Courchevel
45,000
2025
50%
Time-
charter
An international energy
company
May 2028(3)
1,138,862
(1) We are the lessee for these obligations related to finance leases and have an option to repurchase the vessel after the end of the lease terms for a fixed
price.
(2) The charterer has one option to extend the term for an additional five years.
(3) The charterer has one option to extend the term for an additional two years.
(4) Exmar LPG BVBA, in which we have a 50% ownership interest, is the lessee for these obligations related to finance leases and will be required to
purchase the vessel after the end of the lease terms for a fixed price.
(5) In January 2026, the charterer extended the term for an additional 18 months.
(6) In June 2027, the Tielrode, one of the NGL carrier newbuildings currently under construction, will continue on this charter contract until January 2031
with one option to extend the term for an additional one year.
(7) In February 2027, the Temse , one of the NGL carrier newbuildings currently under construction, will continue on this charter contract until January 2031
with one option to extend the term for an additional one year.
(8) In November 2026. the Tielt, one of the NGL carrier newbuildings currently under construction, will continue on this charter contract until December
2030 with one option to extend the term for an additional one year.
(9) In January 2026, the charter extended the term for an additional six months.
31
The following table provides information about our NGL carrier newbuildings under construction as of December 31, 2025. Charters for these
vessels typically commence upon delivery of the vessels.
Vessel
Capacity
Scheduled
Delivery Date
Shipyard
Our
Ownership
Charterer
Length of
Charter
 
(cubic meters)
 
 
 
 
Equity-Accounted
Meribel(1)
40,000
Jan. 2026(1)
Nantong
CIMC(2)
50%
An international energy
company
Dec. 2026
Antwerpen
45,000
May 2026
HMD(3)
50%
N/A
N/A
Menuires
40,000
Mar. 2026
Nantong
CIMC(2)
50%
N/A
N/A
Arlon
45,000
Jul. 2026
HMD(3)
50%
N/A
N/A
Moriond
40,000
Jun. 2026
Nantong
CIMC(2)
50%
N/A
N/A
Aalter
45,000
Aug. 2026
HMD(3)
50%
N/A
N/A
Mottaret
40,000
Oct. 2026
Nantong
CIMC(2)
50%
N/A
N/A
Adinkerke
45,000
Dec. 2026
HMD(3)
50%
N/A
N/A
Tielt
40,000
Oct. 2026
YAMIC(4)
50% -
Chartered-in
An international energy
company
Dec. 2030(5)
Temse
40,000
Feb. 2027
YAMIC(4)
50% -
Chartered-in
An international energy
company
Jan. 2031(5)
Tielrode
40,000
Jun. 2027
YAMIC(4)
50% -
Chartered-in
An international energy
company
Jan. 2031(5)
Tervuren
40,000
Oct. 2027
YAMIC(4)
50% -
Chartered-in
N/A
N/A
Libin
48,000
Nov. 2027
YAMIC(4)
50% -
Chartered-in
N/A
N/A
Libramont
48,000
Dec. 2027
YAMIC(4)
50% -
Chartered-in
N/A
N/A
596,000
(1) On January 8, 2026, the Meribel was delivered to our 50%-owned Exmar LPG Joint Venture and concurrently commenced its one year time-charter
contract.
(2) Nantong CIMC Sinopacific Offshore & Engineering Co., Ltd.
(3) Hyundai Mipo Dockyard Co., Ltd.
(4) Jiangsu Yangzi Mitsui Shipbuilding Co., Ltd.
(5) The charterer has one option to extend the term for an additional one year.
For our consolidated voyage revenues from NGL customers that each accounted for more than 10% of our consolidated voyage revenues, please
read “Item 18 – Financial Statements: Note 4 – Segment Reporting." The loss of any significant customer or a substantial decline in the amount of
services requested by a significant customer could harm our business, financial condition and results of operations.
Business Strategies
Our primary long-term business objective is to expand our core businesses globally in order to service our customers' growing gas transportation
requirements which we believe will add long-term value for our unitholders. We may evaluate and explore adjacent liquified gas markets, renewable
markets, and other maritime opportunities. Our operating cash flows remain largely stable and growing, supported by a large and well-diversified
portfolio of fee-based contracts with high-quality counterparties.
We intend to achieve our long-term business objective, as stated above, by executing the following strategies:
• Provide superior customer service by maintaining high reliability, safety, environmental and quality standards. LNG and NGL project
operators seek LNG and NGL transportation partners that have a reputation for high reliability, safety, environmental and quality standards. We
seek to leverage our operational expertise to create a sustainable competitive advantage with consistent delivery of superior customer service.
32
• Expand our LNG and NGL business globally. We seek to capitalize on opportunities emerging from the global expansion of the LNG and
NGL sectors by selectively targeting:
• projects that involve medium to long-term, fixed-rate charters;
• cost-effective LNG and NGL newbuilding contracts;
• joint ventures and partnerships with companies that may provide increased access to opportunities in attractive LNG and NGL importing
and exporting geographic regions;
• strategic vessel and business acquisitions; and
• specialized projects in adjacent areas of the business.
• Evaluate and explore adjacent liquified gas markets, renewables, and other maritime opportunities. To continue the growth of our
Company, we may evaluate and seek to enter into specialized projects in adjacent areas of our business, including other liquified gas markets,
renewable markets, and other maritime opportunities. 
Safety, Management of Ship Operations and Administration
We internally manage our ship operations, other than the vessels owned or chartered-in by our joint ventures with Exmar, which are commercially
and technically managed by Exmar, two of the Angola LNG Carriers, which are commercially and technically managed by NYK Energy Transport
(Atlantic) Ltd. and four of our LNG carriers, which are chartered-out to Shell Tankers (Singapore) Private Ltd. and technically managed by a
subsidiary of Shell Plc. Safety and Environmental Compliance are our top operational priorities. We operate our vessels in a manner intended to
protect the safety and health of our employees, and to minimize the impact on the environment and society. We seek to effectively manage risk in
the organization using a three-tiered approach at an operational, management and corporate level, designed to provide a clear line of sight
throughout the organization. All of our operational employees receive training in the use of risk tools and the management system. We also have an
approved competency management system in place to ensure our seafarers continue their professional development and are competent before
being promoted to more senior roles.
We are certified under the standards reflected in International Standards Organization’s (or ISO) 9001 for Quality Assurance, ISO 14001 for
Environment Management Systems, ISO 45001 for Occupational Health and Safety Management Systems, and the IMO’s International
Management Code for the Safe Operation of Ships and Pollution Prevention (or ISM Code) on a fully integrated basis. As part of our compliance
with the ISM Code, all of our vessels’ safety management certificates are maintained through annual internal audits performed by our certified
internal auditors and periodical external audits performed by the classification society DNV. Subject to satisfactory completion of these internal and
external audits, certification is valid for five years.
We produce a publicly available sustainability report (available at www.seapeak.com) which reflects the efforts, achievements, results and
challenges faced by us relating to several key related matters, including emissions, climate change, corporate social responsibility, diversity and
health, safety environment and quality. We recognize the significance of ESG considerations and in 2020 set an ESG strategy foundation which is
intended to direct our efforts and performance in the years ahead. Our ESG strategy is focused on three broad areas: allocating capital to support
the global energy transition; operating our existing fleets as safely and efficiently as possible; and further strengthening our ESG profile. We set
annual ESG targets for the organization, which our ESG Department closely monitor.
In October 2023, Seapeak joined the methane abatement in maritime innovation initiative (or MAMII), We have participated in feasibility studies for
new technology to reduce all methane emissions from our LNG carriers. This focuses on two areas:
• Methane emissions carried over with dual fuel engine exhaust gases also known as methane slip.
• Methane emissions due to leaks from cargo equipment, also known as fugitive emissions.
In 2026, we expect to fit exhaust monitoring equipment to one of our LNG carriers to gauge the extent of methane slip. We also expect to utilize a
third party to carry out checks for fugitive emissions across six of our LNG carriers. Our membership in MAMII informs us of potential options to
reduce methane emissions on our LNG fleet. 
On September 16, 2024, Seapeak announced its official membership in the United Nation Oil and Gas Methane Partnership (or OGMP 2.0). OGMP
2.0 is a voluntary initiative launched by the United Nations Environment Programme (or UNEP) to improve the monitoring, reporting, and verification
of methane emissions from oil and gas operations. By joining OGMP 2.0, Seapeak will seek to leverage its maritime expertise to contribute to global
methane reduction goals, enhance transparency, and drive meaningful change in the shipping and maritime industry.
In addition to our operational experience, our in-house global shore staff provides a full range of technical, commercial and business development
services for our LNG and NGL operations. The staff also provides administrative support to our operations in finance, accounting and human
resources. We believe this arrangement affords a safe, efficient and cost-effective operation. Vessel management services are provided by our
teams located in various offices around the world. These include critical vessel management functions such as:
• vessel maintenance (including repairs and dry docking) and certification;
• crewing by competent seafarers;
• procurement of stores, bunkers and spare parts;
• management of emergencies and incidents;
• supervision of shipyard and projects during construction of newbuildings, conversions, lay-up and recycling;
33
• terminal support;
• insurance; and
• financial management services.
These functions are supported by onboard and onshore systems for maintenance, inventory, purchasing and budget management.
We believe that the generally uniform design of some of our existing and newbuilding vessels and the adoption of common equipment standards
provide operational efficiencies, including with respect to crew training and vessel management, equipment operation and repair, and spare parts
ordering.
Risk of Loss, Insurance and Risk Management
The operation of any ocean-going vessel, or LNG facility, carries an inherent risk of catastrophic marine disasters, death or injury of persons and
property losses caused by adverse weather conditions, mechanical failures, human error, war, terrorism, piracy and other circumstances or events.
In addition, the transportation of LNG and NGL is subject to the risk of spills and to business interruptions due to political circumstances in foreign
countries, hostilities, labor strikes, sanctions and boycotts, whether relating to us or any of our joint venture partners, suppliers or customers. The
occurrence of any of these events may result in loss of revenues or increased costs.
We carry hull and machinery (marine and war risks) and protection and indemnity insurance, and other liability insurance, coverage to protect
against most of the accident-related risks involved in the conduct of our business. Hull and machinery insurance covers loss of or damage to a
vessel due to marine perils such as collision, grounding and weather. Protection and indemnity insurance indemnifies us against liabilities incurred
while operating vessels, including injury to our crew or third parties, cargo loss and pollution. The current maximum amount of our coverage for
pollution is $1 billion per vessel per incident. We also carry insurance policies covering war risks (including piracy and terrorism) and, for some of
our LNG carriers, loss of revenues resulting from vessel off-hire time due to a marine casualty.
We believe that our current insurance coverage is adequate to protect against most of the accident-related risks involved in the conduct of our
business and that we maintain appropriate levels of environmental damage and pollution insurance coverage. However, we cannot guarantee that
all covered risks are adequately insured against, that any particular claim will be paid or that we will be able to procure adequate insurance
coverage at commercially reasonable rates in the future. More stringent environmental regulations have resulted in increased costs for, and may
result in the lack of availability of, insurance against risks of environmental damage or pollution.
In our operations, we use thorough risk management program that includes, among other things, risk analysis tools, maintenance and assessment
programs, a seafarers' competence training program, seafarers' workshops and membership in emergency response organizations.
We have achieved certification under the standards reflected in ISO 9001 for Quality Assurance, ISO 14001 for environment management systems,
ISO 45001:2018, and the IMO’s ISM Code on a fully integrated basis.
Flag, Classification, Audits and Inspections
Our vessels are registered with reputable flag states, and the hull and machinery of all of our vessels have been “Classed” by one of the major
classification societies and members of International Association of Classification Societies Ltd.: Bureau Veritas, Lloyd’s Register of Shipping, the
American Bureau of Shipping or DNV.
The applicable classification society certifies that the vessel’s design and build conform to the applicable Class rules and meets the requirements of
the applicable rules and regulations of the country of registry of the vessel and the international conventions to which that country is a signatory.
The classification society also verifies throughout the vessel’s life that it continues to be maintained in accordance with those rules. In order to
validate this, the vessels are surveyed by the classification society, in accordance with the classification society rules, which in the case of our
vessels follows a comprehensive five-year special survey cycle, renewed every fifth year. During each five-year period, the vessel undergoes
annual and intermediate surveys, the scrutiny and intensity of which is primarily dictated by the age of the vessel.
In addition to class surveys, the vessel’s flag state also verifies the condition of the vessel during annual flag state inspections, either independently
or by additional authorization to class. Also, port state authorities of a vessel’s port of call are authorized under international conventions to
undertake regular and spot checks of vessels visiting their jurisdiction.
Processes followed onboard are audited by either the flag state or classification society acting on behalf of the flag state to ensure that they meet
the requirements of the ISM Code. We also follow an internal process of internal audits undertaken annually at each office and vessel.
We follow a comprehensive inspection and audit regime supported by our sea staff, shore-based operational and technical specialists and members
of our Fleet Training Officer program. We typically carry out two internal inspections and one internal audit annually, which helps ensure us that:
• our vessels and operations adhere to our operating standards;
• the structural integrity of the vessel is being maintained;
• machinery and equipment is being maintained to give reliable service;
• we are optimizing performance in terms of speed and fuel consumption; and
• our vessels' appearance supports our brand and meets customer expectations.
34
Our customers also often carry out vetting inspections under the Ship Inspection Report Program, which is a significant safety initiative introduced
by the Oil Companies International Marine Forum to specifically address concerns about sub-standard vessels. The inspection results permit
charterers to screen a vessel to ensure that it meets their general and specific risk-based shipping requirements.
We believe that the heightened environmental and quality concerns of insurance underwriters, regulators and charterers will generally lead to
greater scrutiny, inspection and safety requirements on all vessels in the oil tanker, LNG and NGL carrier markets and will accelerate the scrapping
or phasing out of older vessels throughout these markets.
Overall, we believe that our, well-maintained and high-quality vessels provide us with a competitive advantage in the current environment of
increasing regulation and customer emphasis on quality of service.
Regulations
General
Our business and the operation of our vessels are significantly affected by international conventions and national, state and local laws and
regulations in the jurisdictions in which our vessels operate, as well as in the country or countries of their registration. Because these conventions,
laws and regulations change frequently, we cannot predict the ultimate cost of compliance or their impact on the resale price or useful life of our
vessels. Additional conventions, laws, and regulations may be adopted that could limit our ability to do business or increase the cost of our doing
business, and that may materially affect our operations. We are required by various governmental and quasi-governmental agencies to obtain
permits, licenses and certificates with respect to our operations. Subject to the discussion below and to the fact that the kinds of permits, licenses
and certificates required for the operations of the vessels we own will depend on a number of factors, we believe that we will be able to continue to
obtain all permits, licenses and certificates material to the conduct of our operations.
International Maritime Organization
The IMO is the United Nations’ agency for maritime safety and prevention of pollution. IMO regulations relating to pollution prevention for oil tankers
have been adopted by many of the jurisdictions in which our tanker fleet operates. Under IMO regulations and subject to limited exceptions, a
tanker must be of double-hull construction in accordance with the requirements set out in these regulations or be of another approved design
ensuring the same level of protection against oil pollution. All of our gas carriers are double-hulled.
Many countries, but not the United States, have ratified and follow the liability regime adopted by the IMO and set out in the International
Convention on Civil Liability for Oil Pollution Damage, 1969, as amended (or CLC). Under this convention, a vessel’s registered owner is strictly
liable for pollution damage caused in the territorial waters of a contracting state by discharge of persistent oil (e.g. crude oil, fuel oil, heavy diesel oil
or lubricating oil), subject to certain defenses. The right to limit liability to specified amounts that are periodically revised is forfeited under the CLC
when the spill is caused by the owner’s actual fault or when the spill is caused by the owner’s intentional or reckless conduct. Vessels trading to
contracting states must provide evidence of insurance covering the limited liability of the owner. In jurisdictions where the CLC has not been
adopted, various legislative regimes or common law governs, and liability is imposed either on the basis of fault or in a manner similar to the CLC.
IMO regulations also include the International Convention for Safety of Life at Sea (or SOLAS), including amendments to SOLAS implementing the
International Ship and Port Facility Security Code (or ISPS), the ISM Code, the International Convention on Load Lines of 1966, and, specifically
with respect to LNG and NGL carriers, the International Code for Construction and Equipment of Ships Carrying Liquefied Gases in Bulk (or the IGC
Code) and International Code for Ships operating in Polar Waters (or the Polar Code). SOLAS provides rules for the construction of and the
equipment required for commercial vessels and includes regulations for their safe operation. Flag states which have ratified the convention and the
treaty generally employ the classification societies, which have incorporated SOLAS requirements into their class rules, to undertake surveys to
confirm compliance.
SOLAS and other IMO regulations concerning safety, including those relating to treaties on the training of shipboard personnel, lifesaving
appliances, radio equipment and the global maritime distress and safety system, are applicable to our operations. Non-compliance with IMO
regulations, including SOLAS, the ISM Code, ISPS Code, IGC Code and Polar Code may subject us to increased liability or penalties, may lead to
decreases in available insurance coverage for affected vessels and may result in the denial of access to or detention in some ports. For example,
the USCG and EU authorities have indicated that vessels not in compliance with the ISM Code will be prohibited from trading in U.S. and EU ports.
The ISM Code requires vessel operators to obtain a safety management certification for each vessel they manage, evidencing the shipowner’s
development and maintenance of an extensive safety management system. Each of the existing vessels in our fleet is currently ISM Code-certified,
and we obtain for each newbuilding a safety management certificate on delivery.
LNG and NGL carriers are also subject to regulation under the IGC Code. Each LNG and NGL carrier must obtain a certificate of compliance
evidencing that it meets the requirements of the IGC Code, including requirements relating to its design and construction. Each of our LNG and
NGL carriers is currently IGC Code compliant, and each of the shipbuilding contracts for our LNG carrier newbuildings and for the NGL carrier
newbuildings requires IGC Code compliance prior to delivery. Amendments to the IGC Code, aligning wheelhouse window fire-rating requirements
with those in SOLAS chapter II-2, were adopted in 2016 and became effective on January 1, 2020.
Annex VI of the IMO’s International Convention for the Prevention of Pollution from Ships (or MARPOL) (or Annex VI) sets limits on sulfur oxide (or
SOx) and nitrogen oxide (or NOx) emissions from ship exhausts and prohibits emissions of ozone depleting substances, emissions of volatile
compounds from cargo tanks and the incineration of specific substances. Annex VI also includes a world-wide cap on the sulfur content of fuel oil
and allows for special "emission control areas" (or ECAs) to be established with more stringent controls on sulfur emissions.
35
Annex VI provides for a three-tier reduction in NOx emissions from marine diesel engines, with the final tier (or Tier III) to apply to engines installed
on vessels constructed on or after January 1, 2016 and which operate in the North American ECA or the U.S. Caribbean Sea ECA as well as ECAs
designated in the future by the IMO. Tier III limits are 80% below Tier I, and these cannot be achieved without additional means such as Selective
Catalytic Reduction. In October 2016, the IMO’s Marine Environment Protection Committee (or MEPC) approved the designation of the North Sea
(including the English Channel) and the Baltic Sea as ECAs for NOx emissions. These ECAs and the related amendments to Annex VI of MARPOL
(with some exceptions) entered into effect on January 1, 2019. This requirement is applicable for new ships constructed on or after January 1, 2021
if they visit the Baltic or the North Sea (including the English Channel) and requires the future trading area of a ship to be assessed at the contract
stage. There are exemption provisions to allow ships with only Tier II engines, to navigate in a NOx Tier III ECA if the ship is departing from a
shipyard where the ship is newly built or visiting a shipyard for conversion/repair/maintenance without loading/unloading cargoes.
Effective January 1, 2020, Annex VI imposes a global limit for sulfur in fuel oil used on board ships of 0.50% m/m (mass by mass), regardless of
whether a ship is operating outside a designated ECA. The ECA limit of 0.10% will still apply, as will any applicable local regulations. Effective
March 1, 2020, the carriage of non-compliant fuel is prohibited. To comply with the 2020 global sulfur limit for fuel, ships must utilize different fuels
containing low or very low sulfur (e.g., low sulfur fuel oil, very low sulfur fuel oil, low sulfur marine gas oil (or LSMGO), biofuels or other compliant
fuels such as LNG), or utilize exhaust gas cleaning systems, known as “scrubbers.” Amendments to the information to be included in bunker
delivery notes relating to the supply of marine fuel oil to ships fitted with alternative mechanisms to address sulfur emission requirements (e.g.
scrubbers) became effective January 1, 2019. At present, we have not installed any scrubbers on our existing gas fleet (nor do we have plans to).
All of our LNG and NGL vessels are in compliance with 2020 global sulfur fuel regulations. Our fuel strategy is to use LNG as primary fuel (except
the Q-Flex LNG vessels) and compliance fuels as secondary fuel.
As of March 1, 2018, amendments to Annex VI impose new requirements on ships of 5,000 gross tonnage and above to collect fuel oil consumption
data for ships, as well as certain other data including proxies for transport work. Amendments to MARPOL Annex VI that makes the data collection
system for fuel oil consumption of ships mandatory were adopted at the 70th session of the MEPC held in October 2016 and entered into force on
March 1, 2018. The amendments require operators to update the vessels' Ship Energy Efficiency Management Plan (or SEEMP) to include a part II
describing the ship specific methodology that will be used for collecting and measuring data for fuel oil consumption, distance travelled, hours
underway, ensuring data quality is maintained and the processes that will be used to report the data to the Administration. This has been verified as
compliant on all ships for calendar year 2024. The verification of data collected for the 2025 calendar year is ongoing.
IMO regulations required that, as of January 1, 2015, all vessels operating within ECAs worldwide recognized under MARPOL Annex VI must
comply with 0.1% sulfur requirements. In addition, LSMGO is more expensive than heavy fuel oil, and this impacts the costs of operations. In
general, our charterers are required under our contracts to bear the cost of fuel. However, on occasion we may be exposed to increased fuel costs
in our spot trading vessels, although our competitors bear a similar cost increase as this is a regulatory item applicable to all vessels. All required
vessels in our fleet trading to and within regulated low sulfur areas are able to comply with fuel requirements.
Amendments to MARPOL Annex VI adopted by MEPC.361(79) entered into force on May 1, 2024 which designates the Mediterranean Sea as an
ECA for Sulphur Oxides and Particular Matter. As a result, the limit for sulphur in fuel oil used on board ships in the Mediterranean Sea will be
0.10% m/m.
The IMO has issued guidance regarding protecting against acts of piracy off the coast of Somalia. We comply with these guidelines.
IMO Guidance for countering acts of piracy and armed robbery is published by the IMO’s Maritime Safety Committee (or MSC). MSC.1/Circ.1339
(Piracy and armed robbery against ships in waters off the coast of Somalia) outlines Best Management Practices (or BMP) for protection against
Somalia-based Piracy. Specifically, MSC.1/Circ.1339 provides guidance to shipowners and ship operators, shipmasters and crews on preventing
and suppressing acts of piracy and armed robbery and was adopted by the IMO through Resolution MSC.324(89). The BMP is a joint industry
publication by BIMCO, ICS, IGP&I Clubs, INTERTANKO and OCIMF. Our fleet follows the guidance within BMP 5 when transiting in other regions
with recognized threat levels for piracy and armed robbery, including West Africa.
The IMO's Ballast Water Management Convention entered into force on September 8, 2017. The convention stipulates two standards for
discharged ballast water. The D-1 standard covers ballast water exchange while the D-2 standard covers ballast water treatment. All ships in
service must now comply with the D-2 water quality standard when discharging ballast water in coastal regions. The D-1 quality standard is only
available as a contingency should a complete failure of the ballast water treatment system occur. All Seapeak vessels are fitted with IMO / USCG
approved ballast water treatment systems.
Amendments to Appendix II of Ballast Water Management Convention, adopted by MEPC.369(80) regarding updating the existing format of Ballast
Water Record Book entered into force on February 1, 2025. Our ballast water management procedure and ballast water record book have been
updated and all of our vessels are in compliance with MEPC.369(80).
The IMO has also adopted the Polar Code which deals with matters regarding the design, construction, equipment, operation, search and rescue
and environmental protection in relation to ships operating in waters surrounding the two poles. The Polar Code includes both safety and
environmental provisions. The Polar Code and related amendments entered into force in January 2017. The Polar Code is mandatory for new
vessels built after January 1, 2017. For existing ships, this code will be applicable from the first intermediate or renewal survey, whichever occurs
first, beginning on or after January 1, 2018. All of our vessels trading in this area are fully compliant with the Polar Code.
MARPOL Annex I also states that oil residue may be discharged directly from the sludge tank to the shore reception facility through standard
discharge connections. They may also be discharged to the incinerator or to an auxiliary boiler suitable for burning the oil by means of a dedicated
discharge pump. Amendments to Annex I expand on the requirements for discharge connections and piping to ensure residues are properly
disposed of. Annex I is applicable for existing vessels with a first renewal survey beginning on or after January 1, 2017.
36
Amendments to MARPOL Annex I and V were adopted through MEPC.381(80) and MEPC.382(80), on July 7, 2023. The MEPC agreed the
effective date of January 1, 2025, for the Red Sea and Gulf of Aden Special Areas under MARPOL Annex I and V, based on information provided
related to the status of available necessary reception facilities for MARPOL Annexes I and V wastes and residues, covering all the ports and
terminals within the areas.
Amendments to MARPOL Annex V were adopted at the 70th session of the MEPC held in October 2016 and entered into force on March 1, 2018.
The changes include criteria for determining whether cargo residues are harmful to the marine environment and a new Garbage Record Book (or
GRB) format with a new garbage category for e-waste. Solid bulk cargo as per regulation VI/1-1.2 of SOLAS, other than grain, shall now be
classified as per the criteria in the new Appendix I of MARPOL Annex V, and the shipper shall then declare whether or not the cargo is harmful to
the marine environment. A new form of the GRB has been included in Appendix II to MAROL Annex V. The GRB is now divided into two parts: Part I
- for all garbage other than cargo residues, applicable to all ships. PART II - for cargo residues only applicable to ships carrying solid bulk cargo.
These changes are reflected in the vessels latest revised GRB.
MSC.338(91) adopted amendments to SOLAS Regulation II-2/10 to clarify that a minimum of two-way portable radiotelephone apparatus for each
fire party for fire-fighters' communication shall be carried on board. These radio devices shall be of explosion proof type or intrinsically safe type. As
per MSC.338(91), requirements have also been highlighted for audio and visual indicators for breathing apparatus which will alert the user before
the volume of the air in the cylinder has been reduced to no less than 200 liters. All of our vessels are in compliance with these requirements.
Amendment to SOLAS Regulation II-1/3-8, adopted by MSC.474(102) regarding new requirements covering the provision and maintenance of
mooring lines entered into force on January 1, 2024.
Amendment to LSA Code and Resolution MSC.81(70), adopted by MSC.535(107) and MSC.544(107) entered into force on January 1, 2026,
regarding ventilation requirement of totally enclosed lifeboats.
Cyber-related risks are operational risks that are appropriately assessed and managed in accordance with the safety management requirements of
the ISM Code. Cyber risks were required to be appropriately addressed in our safety management system no later than the first annual verification
of our Document of Compliance after January 1, 2021. As of July 16, 2021, verification audits of our Document of Compliance have been completed
and we are in compliance with IMO Resolution MSC.428(98) requirement for maritime cyber risk management.
The Maritime Labour Convention (or MLC) 2006 was adopted by the International Labour Conference at its 94th (Maritime) Session (2006),
establishing minimum working and living conditions for seafarers. The convention entered into force August 20, 2013, with further amendments
approved by the International Labour Conference at its 103rd Session (2014). The MLC establishes a single, coherent instrument embodying all up-
to-date standards of existing international maritime labour conventions and recommendations, as well as the fundamental principles to be found in
other international labour conventions. All of our maritime labor contracts comply with the MLC.
The 2022 Amendments to MLC, 2006 relating to recruitment and placement, accommodation and recreational facilities, food and catering, health
and safety protection, accident prevention, and financial security entered into force on December 23, 2024. All of our vessels are in compliance with
these requirements.
The IMO continues to review and introduce new regulations and as such, it is difficult to predict what additional requirements, if any, may be
adopted by the IMO and what effect, if any, such regulations might have on our operations.
EU
The EU has adopted legislation that: bans from European waters manifestly sub-standard vessels (defined as vessels that have been detained
twice by EU port authorities, in the preceding two years); creates obligations on the part of EU member port states to inspect minimum percentages
of vessels using these ports annually; provides for increased surveillance of vessels posing a high risk to maritime safety or the marine
environment; and provides the EU with greater authority and control over classification societies, including the ability to seek to suspend or revoke
the authority of negligent societies.
Two regulations that are part of the implementation of the Port State Control Directive, came into force on January 1, 2011 and introduce a ranking
system (published on a public website and updated daily) displaying shipping companies operating in the EU with the worst safety records. The
ranking is judged upon the results of the technical inspections carried out on the vessels owned by a particular shipping company. Those shipping
companies that have the most positive safety records are rewarded by subjecting them to fewer inspections, while those with the most safety
shortcomings or technical failings recorded upon inspection will in turn be subject to a greater frequency of official inspections to their vessels.
The EU has, by way of Directive 2005/35/EC, which has been amended by Directive 2009/123/EC, created a legal framework for imposing criminal
penalties in the event of discharges of oil and other noxious substances from ships sailing in its waters, irrespective of their flag. This relates to
discharges of oil or other noxious substances from vessels. Minor discharges shall not automatically be considered as offences, except where
repetition leads to deterioration in the quality of the water. The persons responsible may be subject to criminal penalties if they have acted with
intent, recklessly or with serious negligence and the act of inciting, aiding and abetting a person to discharge a polluting substance may also lead to
criminal penalties.
The EU has adopted a Directive requiring the use of low sulfur fuel. Since January 1, 2015, vessels have been required to burn fuel with sulfur
content not exceeding 0.1% while within EU member states’ territorial seas, exclusive economic zones and pollution control zones that are included
in SOx ECAs. Other jurisdictions have also adopted similar regulations.
37
All ships above 5,000 gross tonnage calling EU waters are required to comply with EU-MRV regulations. These regulations came into force on July
1, 2015 and aim to reduce GHG emissions within the EU. It requires ships carrying out maritime transport activities to or from European Economic
Area ports to monitor and report information, including verified data on their CO2 emissions from January 1, 2018. Data collection takes place on a
per voyage basis and started from January 1, 2018. The reported CO2 emissions, together with additional data (e.g. cargo, energy efficiency
parameters), are to be verified by independent verifiers and sent to a central database, managed by the European Maritime Safety Agency (or
EMSA). Seapeak has signed an agreement with Det Norske Veritas (or DNV), an international accredited registrar and classification society, for
monitoring, verification and reporting as required by this regulation. The reporting period for the 2024 calendar year has been completed, and
emission reports for the vessels which have carried out EU voyages have been submitted in the Hybrid European Targeting and Inspection System
(or THETIS) database. Based on emission reports submitted in THETIS, a document of compliance has been issued and placed on board.
Following on from the EU MRV regulation, the European Union extended their Emissions Trading System (or EU ETS) to the maritime sector,
entered into force on January 1, 2024.  This requires shipping companies to submit emissions allowances based on their verified maritime
emissions under the EU’s Monitoring, Reporting and Verification (or MRV) framework.  It also introduced the requirement for shipping companies to
submit a Company level Emissions report to the EMSA Thetis Database. 
The Fuel EU Maritime Regulation is a complementary regulation to the European Union Emissions Trading System (or EU ETS), ensuring that the
greenhouse gas intensity of fuels used by the shipping sector will gradually decrease over time. It contributes to the EU-wide target of reducing net
emissions by at least 55% by 2030, and to achieving climate neutrality in 2050. The political agreement was formally adopted on September 13,
2023 and applies from January 1, 2025 (except for Monitoring Plan articles, which shall apply from August 31, 2024). The Fuel EU Maritime
Regulation scope considers vessels above 5,000 gross tonnage, calling European Economic Area (or EEA) ports, no matter what flag they fly (EU/
non-EU), and includes:
• 100% of the energy used from ships calling at an EU/EEA port for voyages within the EU/EEA (intra-EU)
• 50% of the energy used from voyages to or from EU ports (extra-EU/EEA)
• 100% of the energy used when ships are at berth in EU/EEA ports.
     
The Fuel EU Monitoring Plans for Seapeak vessels were approved by an accredited verifier (DNV) and are currently in use with the first reporting
year being 2025.
The EU Ship Recycling Regulation entered into force on December 30, 2013. It aims to prevent, reduce and minimize accidents, injuries and other
negative effects on human health and the environment when ships are recycled, and the hazardous waste they contain is removed. The legislation
applies to all ships flying the flag of an EU country and to vessels with non-EU flags that call at an EU port or anchorage. It sets out responsibilities
for shipowners and for recycling facilities both in the EU and in other countries. Each new ship is required to have on board an inventory of the
hazardous materials (such as asbestos, lead or mercury) it contains in either its structure or equipment. The use of certain hazardous materials is
forbidden. Before a ship is recycled, its owner must provide the company carrying out the work with specific information about the vessel and
prepare a ship recycling plan. Recycling may only take place at facilities listed on the EU ‘List of facilities’.
The EU Ship Recycling Regulation generally entered into force on December 31, 2018, with certain provisions applicable from December 31, 2020.
Compliance timelines are as follows: EU-flagged newbuildings were required to have onboard a verified Inventory of Hazardous Materials (or IHM)
with a Statement of Compliance by December 31, 2018, existing EU-flagged vessels are required to have onboard a verified IHM with a Statement
of Compliance by December 31, 2020, non-EU-flagged vessels calling at EU ports are also required to have onboard a verified IHM with a
Statement of Compliance latest by December 31, 2020. We contracted a class-approved HazMat expert company to assist in the preparation of an
IHM and obtaining Statements of Compliance for our vessels. The EU Commission adopted a European List of approved ship recycling facilities, as
well as four further decisions dealing with certification and other administrative requirements set out in the EU Ship Recycling Regulation. In 2014,
the Council Decision 2014/241/EU authorized EU countries having ships flying their flag or registered under their flag to ratify or to accede to the
Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships.
The Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships entered into force on June 26, 2025, following
the fulfilment of the ratification criteria in June 2023. By June 26, 2026, new build ships will have to have an approved and certified IHM on board.
By June 26, 2030, existing ships will have to have an approved and certificated IHM on board; have a Ready for Recycling Certificate on board, and
only be recycled at a ship recycling facility which has a valid Document of Authorization for Ship Recycling.
Our LNG and NGL ships have an approved and certified IHM on board in accordance with EU Ship Recycling Regulation and Hong Kong
Convention.
China
China had established new ECAs in Pearl River Delta, Yangtze River Delta and Bohai Sea, which came into force from January 1, 2016. The
Hainan ECA came into force from January 1, 2019. From January 1, 2019, all the ECAs have merged, and the scope of Domestic Emission
Controls Areas (or DECAs) will be extended to 12 nautical miles from the coastline, covering the Chinese mainland territorial coastal areas as well
as the Hainan Island territorial coastal waters. From January 1, 2019, all vessels navigating within the Chinese mainland territorial coastal DECAs
and at berths will be required to use marine fuel with sulfur content of maximum 0.50% m/m.  As per the new regulation, ships can also use
alternative methods such as an Exhaust Gas Scrubber, LNG or other clean fuel that reduces the SOx to the same level or lower than the maximum
required limits of sulfur when using fossil fuel in the DECA areas or when at berth. All the vessels without an exhaust gas cleaning system entering
the ECA are only permitted to carry and use the compliant fuel oil specified by the new regulation.
From July 1, 2019, vessels engaged on international voyages (except tankers) that are equipped to connect to shore power must use shore power
if they berth for more than 3 hours in berths with shore supply capacity in the coastal control areas (for inland river control area, berth for more than
2 hours).
38
From January 1, 2020, all vessels navigating within the Chinese mainland territorial coastal DECAs should use marine fuel with a maximum 0.5%
m/m sulfur cap. All the vessels entering China inland waterway ECA are to use the fuel oil with sulfur content not exceeding 0.1% m/m. Any vessel
using or carrying non-compliant fuel oil due to the non-availability of compliant fuel oil is to submit a fuel oil non-availability report to the China
Maritime Safety Administration (or CMSA) of the next arrival port before entering waters under the jurisdiction of China.
From March 1, 2020, all vessels entering waters under the jurisdiction of the People’s Republic of China are prohibited from carrying fuel oil of sulfur
content exceeding 0.50% m/m on board ships. Any vessel carrying non-compliant fuel oil in the waters under the jurisdiction of China is to:
• discharge the non-compliant fuel oil; or
• as permitted by the CMSA of calling port, to retain the non-compliant fuel oil on board with a commitment letter stating it will not be used in
waters under the jurisdiction of China.
United States
The United States has enacted an extensive regulatory and liability regime for the protection and cleanup of the environment from oil spills,
including discharges of oil cargoes, bunker fuels or lubricants, primarily through the Oil Pollution Act of 1990 (or OPA 90) and the Comprehensive
Environmental Response, Compensation and Liability Act (or CERCLA). OPA 90 affects all owners, bareboat charterers, and operators whose
vessels trade to the United States or its territories or possessions or whose vessels operate in United States waters, which include the U.S.
territorial sea and 200-mile exclusive economic zone around the United States. CERCLA applies to the discharge of “hazardous substances” rather
than “oil” and imposes strict joint and several liability upon the owners, operators or bareboat charterers of vessels for cleanup costs and damages
arising from discharges of hazardous substances. We believe that petroleum products, LNG and NGL should not be considered hazardous
substances under CERCLA, but additives to oil or lubricants used on LNG or NGL carriers might fall within its scope.
Under OPA 90, vessel owners, operators and bareboat charters are “responsible parties” and are jointly, severally, and strictly liable (unless the oil
spill results solely from the act or omission of a third party, an act of God or an act of war and the responsible party reports the incident and
reasonably cooperates with the appropriate authorities) for all containment and cleanup costs and other damages arising from discharges or
threatened discharges of oil from their vessels. These other damages are defined broadly to include:
• natural resources damages and the related assessment costs;
• real and personal property damages;
• net loss of taxes, royalties, rents, fees and other lost revenues;
• lost profits or impairment of earning capacity due to property or natural resources damage;
• net cost of public services necessitated by a spill response, such as protection from fire, safety or health hazards; and
• loss of subsistence use of natural resources.
OPA 90 limits the liability of responsible parties in an amount it periodically updates. The liability limits do not apply if the incident was proximately
caused by violation of applicable U.S. federal safety, construction or operating regulations, including IMO conventions to which the United States is
a signatory, or by the responsible party’s gross negligence or willful misconduct, or if the responsible party fails or refuses to report the incident or to
cooperate and assist in connection with the oil removal activities. Liability under CERCLA is also subject to limits unless the incident is caused by
gross negligence, willful misconduct, or a violation of certain regulations. We currently maintain for each of our vessel's pollution liability coverage in
the maximum coverage amount of $1 billion per incident. A catastrophic spill could exceed the coverage available, which could harm our business,
financial condition, and results of operations.
Under OPA 90, with limited exceptions, all newly built or converted tankers delivered after January 1, 1994 and operating in U.S. waters must be
double-hulled. All of our tankers are double-hulled.
OPA 90 also requires owners and operators of vessels to establish and maintain with the USCG evidence of financial responsibility in an amount at
least equal to the relevant limitation amount for such vessels under the statute. The USCG has implemented regulations requiring that an owner or
operator of a fleet of vessels must demonstrate evidence of financial responsibility in an amount sufficient to cover the vessel in the fleet having the
greatest maximum limited liability under OPA 90 and CERCLA. Evidence of financial responsibility may be demonstrated by insurance, surety bond,
self-insurance, guaranty or an alternate method subject to approval by the USCG. Under the self-insurance provisions, the shipowner or operator
must have a net worth and working capital, measured in assets located in the United States against liabilities located anywhere in the world, that
exceeds the applicable amount of financial responsibility. We have complied with the USCG regulations by using self-insurance for certain vessels
and obtaining financial guaranties from a third party for the remaining vessels. If other vessels in our fleet trade into the United States in the future,
we expect to obtain guaranties from third-party insurers.
OPA 90 and CERCLA permit individual U.S. states to impose their own liability regimes with regard to oil or hazardous substance pollution incidents
occurring within their boundaries, and some states have enacted legislation providing for unlimited strict liability for spills. Several coastal states,
such as California and Alaska, require state-specific evidence of financial responsibility and vessel response plans. We intend to comply with all
applicable state regulations in the ports where our vessels call.
Owners or operators of vessels, including tankers operating in U.S. waters, are required to file vessel response plans with the USCG, and their
tankers are required to operate in compliance with their USCG approved plans. Such response plans must, among other things:
• address a “worst case” scenario and identify and ensure, through contract or other approved means, the availability of necessary private
response resources to respond to a “worst case discharge”;
39
• describe crew training and drills; and
• identify a qualified individual with full authority to implement removal actions.
All our vessels have USCG approved vessel response plans. In addition, we conduct regular oil spill response drills in accordance with the
guidelines set out in OPA 90. The USCG has announced it intends to propose similar regulations requiring certain vessels to prepare response
plans for the release of hazardous substances. Similarly, we also have California Vessel Contingency Plans on board vessels which are likely to call
ports in State of California.
OPA 90 and CERCLA do not preclude claimants from seeking damages resulting from the discharge of oil and hazardous substances under other
applicable law, including maritime tort law. Such claims could include attempts to characterize the transportation of LNG or NGL aboard a vessel as
an ultra-hazardous activity under a doctrine that would impose strict liability for damages resulting from that activity. The application of this doctrine
varies by jurisdiction.
The U.S. Clean Water Act (or the Clean Water Act) also prohibits the discharge of oil or hazardous substances in U.S. navigable waters and
imposes strict liability in the form of penalties for unauthorized discharges. The Clean Water Act imposes substantial liability for the costs of
removal, remediation and damages and complements the remedies available under OPA 90 and CERCLA discussed above.
The United States Environmental Protection Agency (“EPA”) has enacted rules requiring ballast water discharges and other discharges incidental to
the normal operation of certain ships within United States waters to be authorized under the Ship General Permit for Discharges Incidental to the
Normal Operation of Ships (“VGP”). To be covered by the VGP, owners of certain ships (typically based on ship length) must submit a Notice of
Intent (“NOI”) at least 30 days before the ship operates in United States waters. In March 2013, the EPA published a new VGP that included
numeric effluent limits for ballast water expressed as the maximum concentration of living organisms in ballast water. The VGP also imposed a
variety of changes for non-ballast water discharges including more stringent “Best Management Practices” for discharges of oil-to-sea interfaces in
an effort to reduce the toxicity of oil leaked into U.S. waters. The 2013 VGP was issued with an effective period of December 19, 2013 to December
18, 2018. The Vessel Incidental Discharge Act, (“VIDA”), enacted on December 4, 2018, requires the EPA and Coast Guard to develop new
performance standards and enforcement regulations and extends the 2013 VGP provisions until new regulations are final and enforceable. We
have submitted NOIs for our fleet and intend to submit NOIs for our ships in the future, where required, and do not believe that the costs associated
with obtaining and complying with the VGP or issuing NOIs will have a material impact on our operations.
Since January 1, 2014, the California Air Resources Board has required that vessels that burn fuel within 24 nautical miles of California burn fuel in
such area with 0.1% sulfur content or less.
Various states in the United States, including California, have implemented additional regulations relating to the environment and operation of
vessels. California Biofouling Management Plan requirements are as follows: developing and maintaining a Biofouling Management Plan,
developing and maintaining a Biofouling Record Book, mandatory biofouling management of the vessel’s wetted surfaces, mandatory biofouling
management for vessels that undergo an extended residency period (e.g. remain in the same location for 45 or more days). All vessels calling at
California water were required to submit the "Annual Marine Invasive Reporting Form" by October 1, 2017 and to have a CA-Biofouling
management plan after a vessel’s first regularly scheduled out-of-water maintenance (e.g. dry dock) after January 1, 2018, or upon delivery on or
after January 1, 2018.
GHG Regulation
In February 2005, the Kyoto Protocol to the United Nations Framework Convention on Climate Change (or the Kyoto Protocol) took effect. Pursuant
to the Kyoto Protocol, adopting countries are required to implement national programs to reduce emissions of GHGs. In December 2009, more than
27 nations, including the United States, entered into the Copenhagen Accord. The Copenhagen Accord is non-binding but is intended to pave the
way for a comprehensive, international treaty on climate change. In December 2015, the Paris Agreement was adopted by a large number of
countries at the 21st Session of the Conference of Parties (commonly known as COP 21, a conference of the countries which are parties to the
United Nations Framework Convention on Climate Change; the COP is the highest decision-making authority of this organization). The Paris
Agreement, which entered into force on November 4, 2016, deals with GHG emission reduction measures and targets from 2020 in order to limit
the global temperature increases to well below 2o Celsius above pre-industrial levels. Although shipping was ultimately not included in the Paris
Agreement, it is expected that the adoption of the Paris Agreement may lead to regulatory changes in relation to curbing GHG emissions from
shipping. In January 2025, U.S. President Trump signed an executive order to withdraw the United States from the Paris Agreement.
In July 2011, the IMO adopted regulations imposing technical and operational measures for the reduction of GHG emissions. These new regulations
formed a new chapter in MARPOL Annex VI and became effective on January 1, 2013. The new technical and operational measures imposed by
these new regulations include the EEDI, which is mandatory for newbuilding vessels, and SEEMP which is mandatory for all vessels. In October
2016, the IMO’s MEPC adopted updated guidelines for the calculation of the EEDI. In October 2014, the IMO’s MEPC agreed in principle to develop
a system of data collection regarding fuel consumption of ships. In October 2016, the IMO adopted a mandatory data collection system under which
vessels of 5,000 gross tonnage and above are to collect fuel consumption and other data and to report the aggregated data so collected to their flag
state at the end of each calendar year. The new requirements entered into force on March 1, 2018.
All vessels are required to submit fuel consumption data to their respective administration/registered organizations for onward submission to the
IMO for analysis and to help with decision-making on future measures. The amendments require operators to update the vessels SEEMP to include
descriptions of the ship-specific methodology that will be used for collecting and measuring data for fuel oil consumption, distance travelled, hours
underway and processes that will be used to report the data to the Administration, in order to ensure data quality is maintained.
Our vessels were verified as compliant before December 31, 2018, with the first data collection period being for the 2019 calendar year. A
Confirmation of Compliance was issued by the administration/registered organization, which must be kept on board the ship.
40
Amendments to the International Convention for the Prevention of Pollution from Ships (or MARPOL) Annex VI entered into force on November 1,
2022. From January 1, 2023 it is mandatory for all ships to calculate their attained EEXI to measure their energy efficiency and to initiate the
collection of data for the reporting of their annual operational carbon intensity indicator (or CII) and CII rating. Data for the annual CII reporting
period of 2025 has been collected and submitted for verification prior to the March 31, 2026 deadline with a Statement of Compliance, and new
ratings are expected to be issued no later than May 31, 2026. The measures are part of IMO's commitment under its 2018 Initial Strategy on
Reduction of GHG Emissions from Ships to reduce carbon intensity from all ships by 40% by 2030 compared to 2008. We have calculated the
attained EEXI for our fleet and installed Engine Power Limitation (or EPL) where necessary to comply with the required EEXI benchmark. Further,
we are exploring alternatives to optimize the emissions output of our vessels, including installing energy saving devices on board our vessels, such
as air lubrication systems and retrofitting reliquefaction plants.
The monitoring, reporting and verification (or MRV) of CO2 emissions from vessels (or the MRV Regulation) entered into force on July 1, 2015. The
MRV Regulation aims to quantify and reduce CO2 emissions from shipping. It lists the requirements on the MRV of carbon dioxide emissions and
requires shipowners and operators to annually monitor, report and verify CO2 emissions for vessels larger than 5,000 gross tonnage calling at any
EU and EFTA (Norway and Iceland) port (with a few exceptions, such as fish-catching or fish-processing vessels). Data collection takes place on a
per voyage basis and started January 1, 2018. The reported CO2 emissions, together with additional data, such as cargo and energy efficiency
parameters, are to be verified by independent verifiers and sent to a central inspection database hosted by EMSA to collate all the data applicable
to the EU region. Companies responsible for the operation of large ships using EU ports are required to report their CO2 emissions.
On July 14, 2022, the European Commission presented its proposal to revise the current EU ETS. The proposal modifies and aligns the existing EU
ETS target of 43% GHG emission reduction by 2030 (vs 2005 levels) with the Fit for 55 Package goal, aiming for at least 55% GHG emission
reduction for the whole EU economy by 2030 (vs 1990 levels). Following the usual political procedure, both the EU Council and the European
Parliament adopted their initial reactions to the proposal of the European Commission in June 2022. With the first step of the political process
achieved, the inter-institutional negotiations between the European Parliament, Council and Commission officially began on July 11, 2022. For the
maritime industry, the emissions emitted by transport maritime were integrated in the current EU ETS as from 2025. It includes CO2 emissions of
most large vessels. Coverage will be progressive, starting in 2025 with 40% of the emissions emitted in 2024 and aiming to achieve full coverage of
intra-EU voyages by 2027. From 2026, non-CO2 emissions such as nitrous oxide (or N2O), and methane will also be included in the system.
Offshore vessels over 5000 GT will be included in the EU ETS from 2027. The EU policymakers have also recognized a list of exemptions and
measures to avoid carbon leakage. Maritime transport is a sector that will not receive free allocation nor be protected by CBAM. This means that
the EU ETS Directive will require the publication of a list of neighboring transshipment ports to avoid evasive behavior of carbon requirements. The
agreement also recognizes exemptions for ice class ships (such as our ARC7 vessels), small islands, outermost EU regions and public service
journeys between Greece and Cyprus.
In the United States, the EPA issued an “endangerment finding” regarding GHGs under the U.S. Clean Air Act. While this finding in itself does not
impose any requirements on our industry, it authorizes the EPA to regulate directly GHG emissions through a rule-making process. In addition,
climate change initiatives are being considered in the United States Congress and by individual states. Any passage of new climate control
legislation or other regulatory initiatives by the IMO, EU, the United States or other countries or states where we operate that restrict emissions of
GHG could have a significant financial and operational impact on our business that we cannot predict with certainty at this time.
Many financial institutions that lend to the maritime industry have adopted the Poseidon Principles, which establish a framework for assessing and
disclosing the climate alignment of ship finance portfolios. The Poseidon Principles set a benchmark for the banks who fund the maritime sector,
which is based on the IMO GHG strategy. IMO has approved an initial GHG strategy in April 2018 to reduce GHG emissions generated from
shipping activity, which represents a significant shift in climate ambition for a sector that currently accounts for 2%-3% of global carbon dioxide
emissions. As a result, the Poseidon Principles have enabled financial institutions to align their ship finance portfolios with responsible
environmental behavior and incentivize international shipping’s decarbonization.
Vessel Security
The ISPS was adopted by the IMO in December 2002 in the wake of heightened concern over worldwide terrorism and became effective on July 1,
2004. The objective of ISPS is to enhance maritime security by detecting security threats to ships and ports and by requiring the development of
security plans and other measures designed to prevent such threats. Each of the existing vessels in our fleet currently complies with the
requirements of ISPS and Maritime Transportation Security Act of 2002 (U.S. specific requirements). Procedures are in place to inform the relevant
reporting regimes such as Maritime Security Council Horn of Africa, the Maritime Domain Awareness for Trade - Gulf of Guinea, and the Information
Fusion Center whenever our vessels are calling in the Indian Ocean Region, or West Coast of Africa or SE Asia high-risk areas respectively. In
order to mitigate the security risk, security arrangements are required for vessels which travel through these high-risk areas.
C.    Organizational Structure
Our sole common unitholder is Stonepeak Limestone Holdings L.P., which is 100% owned by investment vehicles managed by Stonepeak.
Please read Exhibit 8.1 to this Annual Report for a list of our subsidiaries as at December 31, 2025.
D. Property, Plant and Equipment
Other than our vessels and our 30% interest, through the Bahrain LNG Joint Venture, in an LNG receiving and regasification terminal, we do not
have any material property.
Please read “Item 4 – Information on the Company: Our Fleet and Our Charters” for a description of our vessels, and “Item 18 – Financial
Statements: Note 5 – Chartered-In Vessels" and "Note 10 – Long-Term Debt” for information about major encumbrances against our vessels.
41
E. Taxation of the Company
United States Taxation
The following is a discussion of material U.S. federal income tax considerations applicable to us effective January 1, 2019. This discussion is based
upon provisions of the Code, legislative history, applicable U.S. Treasury Regulations (or Treasury Regulations), judicial authority and administrative
interpretations, all as in effect on the date of this Annual Report, and which are subject to change, possibly with retroactive effect, or are subject to
different interpretations. Changes in these authorities may cause the tax consequences to vary substantially from the consequences described
below.
Election to be Taxed as a Corporation. We elected to be taxed as a corporation for U.S. federal income tax purposes effective January 1, 2019. As
such, we are subject to U.S. federal income tax on our income to the extent it is from U.S. sources or otherwise is effectively connected with the
conduct of a trade or business in the United States as discussed below.
Taxation of Operating Income. We expect that substantially all of our gross income and the gross income of our corporate subsidiaries will be
attributable to the transportation of LNG, NGL, ammonia and related products. For this purpose, gross income attributable to transportation (or
Transportation Income) includes income derived from, or in connection with, the use (or hiring or leasing for use) 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 income from time-charters.
Fifty percent (50%) of Transportation Income that either begins or ends, but that does not both begin and end, in the United States (or U.S. Source
International Transportation Gross Income) is considered to be derived from sources within the United States. Transportation Income that both
begins and ends in the United States (or U.S. Source Domestic Transportation Gross Income) is considered to be 100% derived from sources
within the United States. Transportation Income exclusively between non-U.S. destinations is considered to be 100% derived from sources outside
the United States. Transportation Income derived from sources outside the United States generally is not subject to U.S. federal income tax.
Based on our current operations and the operations of our subsidiaries, most of our Transportation Income is from sources outside the United
States and not subject to U.S. federal income tax. However, unless the exemption from U.S. taxation under Section 883 of the Code (or the Section
883 Exemption) applies, our U.S. Source International Transportation Gross Income or U.S. Source Domestic Transportation Gross Income is
generally subject to U.S. federal income taxation under either the net basis and branch profits taxes or the 4% gross basis tax, each of which is
discussed below.
The Section 883 Exemption. In general, the Section 883 Exemption provides that if a non-U.S. corporation satisfies the requirements of Section 883
of the Code and the Treasury Regulations thereunder (or the Section 883 Regulations), it will not be subject to the net basis and branch profits
taxes or the 4% gross basis tax described below on its U.S. Source International Transportation Gross Income. The Section 883 Exemption does
not apply to U.S. Source Domestic Transportation Gross Income.
A non-U.S. corporation (including an entity electing to be taxed as a corporation for U.S. federal income tax purposes) will qualify for the Section 
883 Exemption if, among other things, it (i) is organized in a jurisdiction outside the United States that grants an exemption from tax to U.S.
corporations on International Transportation Gross Income (or an Equivalent Exemption), (ii) meets one of three ownership tests (or Ownership
Tests) described in the Section 883 Regulations, and (iii) meets certain substantiation, reporting and other requirements (or the Substantiation
Requirements).
We do not believe that we will be able to qualify for the Section 883 Exemption and therefore our U.S. Source International Transportation Gross
Income will not be exempt from U.S. federal income taxation.
Net Basis Tax and Branch Profits Tax. If the Section 883 Exemption does not apply, our U.S. Source International Transportation Gross Income
may be treated as effectively connected with the conduct of a trade or business in the United States (or Effectively Connected Income) if we have a
fixed place of business in the United States and substantially all of our U.S. Source International Transportation Gross Income is attributable to
regularly scheduled transportation or, in the case of income derived from bareboat charters, is attributable to a fixed place of business in the United
States. Based on our current operations, none of our potential U.S. Source International Transportation Gross Income is attributable to regularly
scheduled transportation or is derived from bareboat charters attributable to a fixed place of business in the United States. As a result, we do not
anticipate that any of our U.S. Source International Transportation Gross Income will be treated as Effectively Connected Income. However, there is
no assurance that we will not earn income pursuant to regularly scheduled transportation or bareboat charters attributable to a fixed place of
business in the United States in the future, which will result in such income being treated as Effectively Connected Income. U.S. Source Domestic
Transportation Gross Income generally will be treated as Effectively Connected Income. However, we do not anticipate that a material amount of
our income has been, or will be, U.S. Source Domestic Transportation Gross Income.
Any income we earn that is treated as Effectively Connected Income would be subject to U.S. federal corporate income tax (which statutory rate as
of the end of 2025 was 21%) and a 30% branch profits tax imposed under Section 884 of the Code. In addition, a branch interest tax could be
imposed on certain interest paid or deemed paid by us.
On the sale of a vessel that has produced Effectively Connected Income, we generally would be subject to the net basis and branch profits taxes
with respect to our gain recognized up to the amount of certain prior deductions for depreciation that reduced Effectively Connected Income.
Otherwise, we would not be subject to U.S. federal income tax with respect to gain realized on the sale of a vessel, provided the sale is considered
to occur outside of the United States under U.S. federal income tax principles.
42
The 4% Gross Basis Tax. If the Section 883 Exemption does not apply and we are not subject to the net basis and branch profits taxes described
above, we will be subject to a 4% U.S. federal income tax on our gross U.S. Source International Transportation Gross Income, without benefit of
deductions. With respect to our taxable year ended in 2025, we believe we are subject to the 4% Gross Basis Tax and that we will not be able to
qualify for the Section 883 Exemption. We expect the amount of our liability for U.S. federal income tax on our U.S. Source International
Transportation Gross Income for such taxable year will be approximately $1.1 million. The amount of such tax for which we are liable in any year
will depend upon the amount of income we earn from voyages into or out of the United States in such year, however, which is not within our
complete control.
Marshall Islands Taxation
Because we and our controlled affiliates do not, and we do not expect that we and our controlled affiliates will, conduct business, operations, or
transactions in the Republic of the Marshall Islands, neither we nor our controlled affiliates are subject to income, capital gains, profits or other
taxation under current Marshall Islands law, other than taxes, fines, or fees due to (i) the incorporation, dissolution, continued existence, merger,
domestication (or similar concepts) of legal entities registered in the Republic of the Marshall Islands, (ii) filing certificates (such as certificates of
incumbency, merger, or redomiciliation) with the Marshall Islands registrar, (iii) obtaining certificates of good standing from, or certified copies of
documents filed with, the Marshall Islands registrar, (iv) compliance with Marshall Islands law concerning vessel ownership, such as tonnage tax, or
(v) non-compliance with economic substance regulations or requests made by the Marshall Islands Registrar of Corporations relating to our books
and records and the books and records of our subsidiaries. As a result, distributions by controlled affiliates to us are not subject to Marshall Islands
taxation.
Other Taxation
We and our subsidiaries are subject to taxation in certain non-U.S. jurisdictions because we or our subsidiaries are either organized, or conduct
business or operations, in such jurisdictions. In other non-U.S. jurisdictions, we and our subsidiaries rely on statutory exemptions from tax.
However, we cannot assure that any statutory exemptions from tax on which we or our subsidiaries rely will continue to be available as tax laws in
those jurisdictions may change or we or our subsidiaries may enter into new business transactions relating to such jurisdictions, which could affect
our or our subsidiaries' tax liability. Please read “Item 18 – Financial Statements: Note 11 – Income Tax (Expense) Recovery .”
Item 4A. Unresolved Staff Comments
Not applicable.
Item 5. Operating and Financial Review and Prospects
The following discussion should be read in conjunction with the consolidated financial statements and notes thereto appearing elsewhere in this
report. In addition, please refer to Item 5 in our Annual Report on Form 20-F for the year ended December 31, 2024 for our discussion and analysis
comparing financial condition and results of operations from 2024 to 2023.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
Overview
Seapeak LLC is an international provider of marine transportation services focusing on LNG and NGL. Our primary strategy focuses on servicing
customers through our owned and leased fleet of vessels under medium to long-term, fixed-rate charters. We may evaluate and enter into adjacent
liquefied gas markets, renewable markets, and other maritime opportunities. In executing our strategy, we may engage in vessel or business
acquisitions or enter into joint ventures and partnerships with companies that provide increased access to emerging opportunities from global
expansion of the LNG and NGL sectors.
SIGNIFICANT DEVELOPMENTS IN 2025 AND EARLY 2026
LNG Carrier Newbuildings
In December 2025, we entered into shipbuilding contracts with Samsung Heavy Industries Co., Ltd. for the construction of two, 174,000-cubic meter
low-pressure dual-fueled (X-DF) LNG carrier newbuildings. The two LNG carriers will be constructed for a total estimated fully built-up of cost of
$511.6 million and the first installment payments totaling $48.9 million were paid in February 2026.
Concurrently in December 2025, we secured 10-year fixed-rate charter contracts with a U.S.-based, investment grade LNG exporter for the two
LNG carrier newbuildings, which are expected to commence during the second half of 2028 upon deliveries of the vessels.
Steam Turbine LNG Carriers
As at January 1, 2025, our LNG segment included seven steam turbine LNG carriers, the oldest vessels in our LNG fleet.
43
Spanish Fleet
In early 2025, the three steam turbine LNG carriers, the Seapeak Hispania, the Seapeak Mars (formerly, the Seapeak Madrid), and the Seapeak
Asia (formerly, the Seapeak Catalunya) were placed in lay-up to reduce our operating costs while we explored chartering opportunities. In
December 2025, as we were ultimately unable to charter the Seapeak Asia, the vessel was sold for net proceeds of $12.1 million, resulting in a loss
on sale of $3.8 million. In December 2025, the carrying values of the Seapeak Mars and the Seapeak Hispania were written down to their estimated
sales prices based on the sale of the Seapeak Asia, resulting in a total impairment charge of $7.1 million. In January 2026, the Seapeak Mars was
sold for net proceeds of $12.1 million. In January 2026, the Seapeak Hispania was renamed Seapeak Jupiter and the vessel was sold in March
2026 for net proceeds of $14.9 million.
In addition, we recognized $21.9 million of restructuring costs during 2025, which primarily related to severance costs for our seafarers associated
with these vessels.
RasGas II Joint Venture
The 20-year charters for the three steam turbine LNG carriers (or the RasGas II Joint Venture vessels), of which we have a 70% ownership interest
(or the RasGas II Joint Venture), are scheduled to expire during October 2026 to February 2027. Steam turbine LNG carriers are currently facing
market pressure due to weak demand and thus a record number of such vessels are currently inactive. The outlook for these vessels is not
expected to significantly improve by late-2026 or early-2027. We expect that the RasGas II Joint Venture vessels will be sold, unless a suitable
charter can be found prior to the expiration of their existing charters. As a result, effective October 1, 2025, we reduced our estimate of their useful
lives from 25 years to 20 years. In addition, the carrying values of these vessels were written down to their estimated fair values in late-2025,
resulting in a total impairment charge of $60.1 million.
MALT LNG Carrier Charter Contracts
Two of the six LNG carriers in our 52%-owned MALT Joint Venture, the Seapeak Marib and Seapeak Arwa, were chartered-out to Yemen LNG
Company Limited (or YLNG) under long-term charter contracts. However, due to the political unrest in Yemen, YLNG decided to temporarily close
operation of its LNG plant in Yemen in 2015. As a result, commencing January 1, 2016, the MALT Joint Venture agreed to successive deferral
arrangements with YLNG pursuant to which a portion of the charter payments was deferred. In March 2025, the MALT Joint Venture entered into a
third suspension agreement (or the Third Suspension Agreement) with YLNG to further extend the charter deferral period for the Seapeak Marib
and the Seapeak Arwa for up to an additional three years until March and April 2028, respectively. Should the LNG plant in Yemen resume
operations during the term of the Third Suspension Agreement, YLNG will be required to repay the applicable deferred amounts plus interest in
installments over a specified time period. However, there are no assurances if or when the LNG plant will resume operations, or if YLNG will repay,
or be able to repay, all or any portion of the deferred amounts. As was the case with the previous suspension agreements, pursuant to and during
the term of the Third Suspension Agreement, the MALT Joint Venture is permitted to directly charter the Seapeak Marib and the Seapeak Arwa for
its own account to third parties.
Russia-Ukraine War
The ongoing Russia-Ukraine war has disrupted energy markets and supply chains, has resulted in various sanctions on Russian entities,
individuals, and sectors, and has caused volatility in global energy markets. While much uncertainty remains regarding the global impact and
remaining duration of the war, and the impact of any additional sanctions that may be imposed on Russia and its trading partners, it is possible that
continued hostilities between Russia and Ukraine and any actions taken by the U.S., EU, UK or by other countries or administrations in response to
those hostilities could adversely affect our business, financial condition, results of operations and cash flows. In October 2025, the EU announced
that effective January 1, 2027, there will be a ban on Russian LNG imported into the EU pursuant to long-term supply contracts. In November 2025,
the UK announced its intention to implement a ban on the provision of UK maritime services and UK insurance services in connection with Russian
LNG exports. To date, we have not experienced any material adverse financial impact as a result of the Russia-Ukraine war. However, as a result of
these recent announcements (and as the regulatory landscape continues to evolve), we expect we will be required to restructure our operations to
comply with applicable sanctions.
Geopolitical and Economic Uncertainty
The U.S. administration continues to negotiate and implement new or increased tariffs on foreign imports, which has resulted in retaliatory tariffs
being levied on certain U.S. goods and commodities and may lead to potential trade wars. This activity has disrupted global markets resulting in
significant volatility in stock and commodity prices and an increase in general global economic uncertainty, including an increased risk of economic
recessions.
Separately, tensions in the Middle East may impact our business. Most recently, in February 2026, the U.S. and Israel launched a major attack on
Iran which has resulted in a retaliation by Iran against U.S. military bases in the Middle East and other targets. This recent conflict in the Middle
East has resulted in attacks on commercial vessels, disruption of shipping trade routes and high risk in entering the Strait of Hormuz.
As a result of the rapidly changing and unpredictable geopolitical climate, the shipping industry is experiencing uncertainty as to future vessel
demand, trade routes, rates and operating costs.
Proposed U.S. and China Port Fees
In early 2025, the Office of the U.S. Trade Representative announced that port fees would apply to vessels connected with China and that dock at
U.S. ports. Commencing on October 14, 2025, Chinese vessel owners and Chinese vessel operators were expected to be subject to fees starting at
$50 per net ton, and non-Chinese operators using Chinese-built vessels were expected to be subject to fees starting at $18 per net ton, in each
case, subject to annual fee increases but up to a cap of five visits per year per vessel.
44
In October 2025, China announced retaliatory port fees on vessels connected with the U.S. and that dock at Chinese ports. The fee, which was also
scheduled to be effective from October 14, 2025, started at RMB 400 per net ton (approximately $55 per net ton), and was subject to a cap of five
visits per calendar year. 
In November 2025, the U.S. and China announced that they had agreed on a reciprocal one-year suspension of their respective port fees. 
Other Fleet Developments
We have three LNG carriers in our 52%-owned joint venture that recently completed their long-term charter contracts and have been operating on
short-term charter contracts since their redeliveries. Additionally, we have five LNG carriers (including two LNG carriers from our 52%-owned joint
venture and one LNG carrier from our 70%-owned RasGas II Joint Venture) which are expected to complete their long-term charter contracts during
2026. LNG project delays have caused a near-term oversupply of LNG carriers. As a result, our results for 2026 and beyond may be negatively
impacted to the extent that there are periods within 2026 or subsequent years that we have LNG carriers without charter contracts or we have
rechartered our LNG carriers at rates lower than they earned on their prior charter contracts.
IMPORTANT FINANCIAL AND OPERATIONAL TERMS AND CONCEPTS
We use a variety of financial and operational terms and concepts when analyzing our performance. These include the following:
Voyage Revenues. Voyage revenues currently include revenues from charters accounted for under operating, and direct financing and sales-type
leases. Voyage revenues are affected by hire rates and the number of calendar-ship-days a vessel operates. Voyage revenues are also affected by
the mix of business between time and voyage charters. Hire rates for voyage charters are more volatile than for time charters, as they are typically
tied to prevailing market rates at the time of a voyage.
Voyage Expenses. Voyage expenses are all expenses unique to a particular voyage, including any fuel expenses, port fees, cargo loading and
unloading expenses, canal tolls, agency fees and commissions. Voyage expenses are typically paid by the customer under time charters and by us
under voyage charters.
Net Voyage Revenues. Net voyage revenues represents income (loss) from vessel operations before vessel operating expenses, time-charter hire
expenses, depreciation and amortization, general and administrative expenses, (write-down) gain and (loss) gain on sales of vessels, and
restructuring charges. This is a non-GAAP financial measure; for more information about this measure, please read "Item 5 – Operating and
Financial Review and Prospects – Non-GAAP Financial Measures".
Vessel Operating Expenses. Under all types of charters and contracts for our vessels, except for bareboat charters, we are responsible for vessel
operating expenses, which include crewing, ship management services, repairs and maintenance, insurance, stores, lube oils and communication
expenses. The two largest components of our vessel operating expenses are crew costs and repairs and maintenance. We expect these expenses
to increase as our fleet matures and to the extent that it expands.
Income (Loss) from Vessel Operations. To assist us in evaluating our operations by segment, we analyze the income (loss) we earn (incur) from
each segment after deducting operating expenses, but prior to the inclusion or deduction of equity income, interest expense, interest income,
realized and unrealized (loss) gain on non-designated derivative instruments, foreign currency exchange loss, other (expense) income and income
tax (expense) recovery. For more information, please read “Item 18 – Financial Statements: Note 4 – Segment Reporting.”
Dry docking. We must periodically dry dock each of our vessels for inspection, repairs and maintenance and any modifications required to comply
with industry certification or governmental requirements. Generally, we dry dock each of our vessels every two and a half years to five years,
depending upon the type of vessel and its age. We capitalize certain costs incurred during dry docking and amortize those costs on a straight-line
basis from the completion of a dry docking to the estimated completion of the next dry docking. We include in capitalized dry docking those costs
incurred as part of the dry docking to meet classification and regulatory requirements. We expense costs related to routine repairs and maintenance
performed during dry docking. The number of dry dockings undertaken in a given period and the nature of the work performed determine the level
of dry-docking expenditures.
Depreciation and Amortization. Our depreciation and amortization expense typically consists of the following three components:
• charges related to the depreciation of the historical cost of our fleet (less an estimated residual value) over the estimated useful lives of our
vessels;
• charges related to the amortization of dry-docking expenditures over the useful life of the dry dock; and
• charges related to the amortization of the fair value of time-charters acquired over the expected remaining terms of the charters.
Revenue Days. Revenue days are the total number of calendar days our vessels were in our possession during a period less the total number of
off-hire days during the period associated with major repairs, dry dockings or special or intermediate surveys. Consequently, revenue days
represents the total number of days available for the vessel to earn revenue. Idle days, which are days when the vessel is available to earn
revenue, yet is not employed, are included in revenue days. We use revenue days to explain changes in our net voyage revenues between periods.
Calendar-Ship-Days. Calendar-ship-days are equal to the total number of calendar days that our vessels were in our possession during a period.
As a result, we use calendar-ship-days primarily in explaining changes in vessel operating expenses and depreciation and amortization.
Utilization. Utilization is an indicator of the use of our fleet during a given period and is determined by dividing our revenue days by our calendar-
ship-days for the period.
45
SUMMARY FINANCIAL DATA
Set forth below is summary consolidated financial and other data of Seapeak LLC and its subsidiaries for fiscal years 2025 and 2024, which have
been derived from our consolidated financial statements. The following table should be read together with, and is qualified in its entirety by
reference to, the consolidated financial statements and the accompanying notes for the years ended December 31, 2025 and 2024 (which are
included herein).
(in thousands of U.S. Dollars, except fleet data)
Year Ended
December 31,
2025
$
Year Ended
December 31,
2024
$
GAAP Financial Comparison:
Income Statement Data:
Voyage revenues
636,958
710,744
Income (loss) from vessel operations(1)
130,870
(94,505)
Equity income
93,241
122,279
Net income (loss)(1)
25,991
(95,821)
Balance Sheet Data (at end of period):
Cash and cash equivalents
122,906
153,726
Restricted cash
22,248
34,242
Vessels and equipment(2)
2,786,535
2,954,134
Investment in and advances to equity-accounted joint ventures, net
1,357,862
1,346,578
Net investments in direct financing and sales-type leases, net(3)
602,518
646,326
Total assets
5,137,634
5,378,721
Total debt(4)
2,694,581
2,787,092
Total equity
2,189,989
2,306,694
Non GAAP Financial Comparison: (5)
Net voyage revenues
624,877
699,150
EBITDA(1)
325,847
208,673
Fleet Data:
Average number of vessels: (6)
  Consolidated – LNG Carriers
21
20
  Equity-Accounted – LNG Carriers
24
24
  Consolidated – NGL Carriers
10
17
  Equity-Accounted – NGL Carriers
19
18
(1) Amounts are net of (write-down) gain and (loss) gain on sales of vessels of ($71.0) million and ($382.8) million for 2025 and 2024, respectively.
(2) Vessels and equipment consists of (a) our vessels, at cost less accumulated depreciation, (b) vessels related to finance leases, at cost less
accumulated depreciation and (c) advances on newbuilding contracts.
(3) Certain of our external charters have been accounted for as direct financing and sales-type leases. As a result, the vessels associated with the external
charters accounted for as direct financing and sales-type leases are not included as part of vessels and equipment. Please read "Item 18 – Financial
Statements: Note 6 – Revenue – Net Investments in Direct Financing and Sales-Type Leases."
(4) Total debt represents the current portion of long-term debt and long-term debt, net of unamortized discount and debt issuance costs, and the current
and long-term portions of obligations related to finance leases.
(5) Net voyage revenues and EBITDA are non-GAAP financial measures. The definition and an explanation of the usefulness and purpose of each
measure as well as a reconciliation to the most directly comparable financial measure calculated and presented in accordance with GAAP, are
contained within the section  “Non-GAAP Financial Measures” at the end of this Item 5 – Operating and Financial Review and Prospects.
(6) Average number of vessels is based on the period during the year that our vessels were in our possession, excluding any vessels under construction.
The average number of vessels for our consolidated NGL fleet includes six vessels chartered-in until December 2024 and the average number of
vessels for our equity-accounted NGL fleet includes seven vessels chartered-in by our Exmar LPG Joint Venture during the year ended December 31,
2025 (year ended December 31, 2024 – six vessels).
46
RESULTS OF OPERATIONS
Items You Should Consider When Evaluating Our Results of Operations
Some factors that have affected our historical financial performance and may affect our future performance are listed below:
• The size of our fleet changes. Our historical results of operations reflect changes in the size and composition of our fleet due to certain
vessel deliveries and sales, including within our equity-accounted joint ventures. Please read “Liquefied Natural Gas Segment”, "Natural Gas
Liquids Segment" below and “Significant Developments in 2025 and Early 2026” above for further details about certain prior and future vessel
deliveries, acquisitions and sales.
• The amount and timing of dry docking of our vessels can affect our revenues between periods. Our vessels are off-hire at various times
due to scheduled and unscheduled maintenance. During 2025 and 2024, we had 78 and 80 scheduled off-hire days, respectively, relating to
the dry docking of our vessels which are consolidated for accounting purposes. In addition, certain of our consolidated vessels had unplanned
off-hire of 34 days in 2025 and 71 days in 2024 relating to repairs. The financial impact from these periods of off-hire, if material, is explained in
further detail below.
• Vessel operating and other costs are facing industry-wide inflationary cost pressures. We continue to maintain our operating expense
increases at or below inflationary levels. However, certain of our time-charter contracts contain a variable component based on actual vessels
operating expenses incurred or adjust annually for inflation, which are both intended to protect us from increases in vessel operating
expenses.
• Our financial results are affected by fluctuations in the fair value of our derivative instruments. The change in fair value of our
derivative instruments is included in our net income (loss) as our derivative instruments and the majority of the derivative instruments held by
our equity-accounted joint ventures are not designated as hedges for accounting purposes. These changes may fluctuate significantly as
interest rates and foreign currency exchange rates fluctuate relating to our interest rate swaps and cross currency swaps. Please read “Item 18
– Financial Statements: Note 13 – Derivative Instruments and Hedging Activities.” The unrealized gains or losses relating to changes in fair
value of our derivative instruments do not impact our cash flows.
• Our financial results are affected by fluctuations in currency exchange rates. Under GAAP, all foreign currency-denominated monetary
assets and liabilities (including cash and cash equivalents, restricted cash, accounts receivable, accounts payable, accrued liabilities, amounts
due to affiliates, and long-term debt) are revalued and reported based on the prevailing exchange rate at the end of the period. These foreign
currency translations fluctuate based on the strength of the U.S. Dollar relative mainly to the Euro and NOK and are included in our results of
operations. The translation of all foreign currency-denominated monetary assets and liabilities at each reporting date results in unrealized
foreign currency exchange gains or losses but does not currently impact our cash flows.
• Our revenues may be impacted by vessels coming off medium to long-term, fixed-rate charter contracts. Our primary strategy focuses
on servicing customers through our fleet of vessels under medium to long-term, fixed-rate charter contracts. When such vessels complete
these charter contracts, we seek to recharter these vessels on new charter contracts. To the extent these new charter contracts have hire rates
that are higher or lower than their previous charter contracts, our revenue will positively or negatively impacted.
• Certain of our equity-accounted vessels earned revenues based partly on spot market rates. Certain of our LPG carriers in our 50%-
owned Exmar LPG Joint Venture were either trading or are currently trading in the spot market or have a component of their charter rate linked
to spot market rates. Volatility of spot rates will affect our results from period to period.
• We do not completely control access to cash flow generated by our investments in equity-accounted joint ventures. We do not have
complete control over the operations of, nor do we have any legal claim to the revenue and expenses of our investments in our equity-
accounted joint ventures. Consequently, the cash flow generated by our investments in equity-accounted joint ventures may not be available
for use by us in the period that such cash flows are generated.
47
Year Ended December 31, 2025 versus Year Ended December 31, 2024
Liquefied Natural Gas Segment
As at December 31, 2025, our liquefied natural gas segment fleet included 51 LNG carriers (including seven LNG carriers under construction), and
one LNG regasification terminal in Bahrain, in which our interests ranged from 20% to 100%.
The following table compares our liquefied natural gas segment’s operating results, revenue days, calendar-ship-days and utilization for 2025 and 
2024 and compares its net voyage revenues (which is a non-GAAP financial measure) for the years ended December 31, 2025 and 2024 to income
(loss) from vessel operations, the most directly comparable GAAP financial measure. With the exception of equity income, all data in this table only
includes an average of 21 LNG carriers that are accounted for under the consolidation method of accounting for the year ended December 31, 2025
(2024 – an average of 20 LNG carriers), and the ship management and corporate services we provide to certain of our equity-accounted joint
ventures. A comparison of the results from vessels and assets accounted for under the equity method is described later in this section under "Equity
Income."
(in thousands of U.S. Dollars, except for days and percentages)
Year Ended December 31,
 % Change
2025
2024
Change
Voyage revenues
522,468
566,614
(44,146)
(7.8)
Voyage expenses
(11,178)
(4,598)
(6,580)
143.1
Net voyage revenues (1)
511,290
562,016
(50,726)
(9.0)
Vessel operating expenses
(186,710)
(181,427)
(5,283)
2.9
Depreciation and amortization
(111,816)
(111,339)
(477)
0.4
General and administrative expenses(2)
(30,971)
(23,402)
(7,569)
32.3
Write-down and loss on sales of vessels
(71,006)
(387,109)
316,103
(81.7)
Restructuring charges
(21,927)
—
(21,927)
100.0
Income (loss) from vessel operations
88,860
(141,261)
230,121
162.9
Equity income
67,525
94,577
(27,052)
(28.6)
Operating Data:
Calendar-Ship-Days (B)
7,642
7,389
253
3.4
Less:
  Scheduled dry-docking days
—
34
(34)
(100.0)
  Unscheduled off-hire and idle days
1,063
185
878
474.6
Revenue Days (A)
6,579
7,170
(591)
(8.2)
Utilization (A)/(B)
86.1%
97.0%
(1) This is a non-GAAP financial measure; for more information about this measure, please read "Item 5 – Operating and Financial Review and Prospects –
Non-GAAP Financial Measures".
(2) Includes direct general and administrative expenses and indirect general and administrative expenses (allocated to each segment based on estimated
use of resources). See the discussion under "Other Operating Results" below.
Our liquefied natural gas segment’s total calendar-ship-days increased to 7,642 days in 2025 from 7,389 days in 2024. The increase in total
calendar-ship-days is due to the purchase of the Marvel Swan LNG carrier in October 2024, partially offset by the sale of the Seapeak Asia in
December 2025.
Net Voyage Revenues . Net voyage revenues decreased by $50.7 million in 2025 compared to 2024, primarily due to:
• a decrease of $55.0 million during 2025 primarily due to the lay-up of the Seapeak Asia, the Seapeak Hispania, and the Seapeak Mars LNG
carriers and lower short-term charter rates earned following the scheduled completion of their previous charter contracts;
• a decrease of $18.9 million primarily due to lower charter rates earned by the Seapeak Vancouver LNG carrier following the scheduled
completion of its previous charter contract in March 2025;
• a decrease of $3.7 million primarily due to a decrease in operating and maintenance cost recoveries from the management and operations of
the Bahrain LNG Terminal, in which we have a 30% ownership interest, during 2025 as additional repairs and maintenance were performed on
the terminal in 2024 ahead of its restart in early-2025; and
• a decrease of $2.7 million due to lower charter rates earned by the Seapeak Glasgow LNG carrier following the scheduled completion of its
previous charter contract in November 2025;
48
partially offset by:
• an increase of $24.9 million due to the purchase of the Marvel Swan LNG carrier in October 2024;
• an increase of $3.4 million due to higher reimbursement of seafarers' costs (offset in vessel operating expenses) and ship management fees
from certain of our equity-accounted joint ventures during 2025; and
• an increase of $0.9 million due to fewer off-hire days for unscheduled repairs on certain of our LNG carriers during 2025.
Vessel Operating Expenses. Vessel operating expenses increased by $5.3 million in 2025 compared to 2024, primarily due to:
• an increase of $4.8 million due to the purchase of the Marvel Swan LNG carrier in October 2024;
• an increase of $2.8 million due to higher reimbursable seafarers' costs related to vessels operating in certain of our equity-accounted joint
ventures (offset in voyage revenues) during 2025;
• an increase of $1.4 million due to higher seafarers' costs on certain of our LNG carriers during 2025 as a result of salary increases and the
timing and location of crew changes; and
• an increase of $1.3 million due to higher insurance costs during 2025;
partially offset by:
• a decrease of $4.6 million due to the lay-up of three of our steam turbine LNG carriers since early-2025; and
• a decrease of $1.8 million due to a reduction in repairs and maintenance on the Bahrain LNG terminal, partially offset by increased manning
costs as the terminal restarted operations in early-2025.
Depreciation and Amortization. Depreciation and amortization increased by $0.5 million in 2025 compared to 2024, primarily due to:
• an increase of $5.5 million during 2025 due to the purchase of the Marvel Swan LNG carrier in October 2024;
partially offset by:
• a decrease of $3.2 million during 2025 due to the acquisition cost of the 20-year time-charter contract for the Seapeak Mars being fully
amortized upon its scheduled completion in December 2024; and
• a decrease of $1.8 million due to the write-down of our seven steam turbine LNG carriers during the fourth quarter of 2024 and the further
write-down of the three RasGas II steam turbine LNG carriers in the third quarter of 2025; partially offset by the reduction in the estimated
useful life of these seven LNG carriers by 10 years effective January 1, 2025 and the RasGas II steam turbine LNG carriers by an additional
five years effective October 1, 2025.
Write-down and Loss on Sales of Vessels. Write-down and loss on sales of vessels decreased by $316.1 million from $387.1 million in 2024 to
$71.0 million in 2025 primarily due to:
• a decrease of $387.1 million due to the write-down of seven of our steam turbine LNG carriers to their estimated fair values in December 2024
as a result of changes in our expectations of their future opportunities;
partially offset by:
• an increase of $60.1 million due to the write-down of the three RasGas II steam turbine LNG carriers to their estimated fair values in
September 2025, as a result of further changes in our expectations of their future opportunities;
• an increase of $7.1 million due to the write-down of the Seapeak Mars and Seapeak Hispania steam turbine LNG carriers to their expected net
sales proceeds in December 2025; and
• an increase of $3.8 million due to the loss on the sale of the Seapeak Asia steam turbine LNG carrier in December 2025.
Equity Income. Equity income decreased by $27.0 million in 2025 compared to 2024. The change in equity income included a decrease of $14.4
million related to changes in our unrealized credit loss provisions recorded in certain of our equity-accounted joint ventures, primarily due to a
decrease in the estimated charter-free vessel fair values for vessels servicing time-charter contracts accounted for as direct financing or sales-type
leases in 2025 and a decrease of $7.8 million due to unrealized losses on non-designated derivative instruments in 2025 compared to unrealized
gains on non-designated derivative instruments in 2024 primarily due to changes in long-term forward benchmark interest rates. Excluding these
changes in unrealized credit loss provisions and unrealized (losses) gains on non-designated derivative instruments, equity income decreased by
$4.8 million, primarily due to:
49
• MALT LNG Joint Venture: a decrease of $21.0 million primarily due to lower charter rates earned by certain LNG carriers and the vessels
being temporarily idle between short-term charter contracts during 2025, partially offset by fewer off-hire days due to a decrease in scheduled
dry dockings on certain LNG carriers during 2025.
• Excalibur LNG Joint Venture: a decrease of $2.1 million from our Excalibur Joint Venture, in which we sold our 50% interest in September
2022, due to the net proceeds received during 2024 from an arbitration award related to the early termination of a charter in 2022.
partially offset by:
• Yamal LNG Joint Venture: an increase of $14.8 million primarily due to unrealized foreign exchange gains due to the period-end revaluation of
Euro cash deposits for financial reporting purposes into U.S. Dollars; partially offset by higher depreciation expense primarily due to the
completion of the first scheduled dry dockings of certain LNG carriers during 2024.
• Bahrain LNG Joint Venture: an increase of $2.9 million primarily due to a decrease in Bahrain LNG terminal repair costs during 2025, partially
offset by an increase in legal expenses and interest costs associated with the settlement of a dispute with the Bahrain LNG terminal contractor
in October 2025.
Natural Gas Liquids Segment
As at December 31, 2025, our natural gas liquids segment fleet, which consists of LPG, ethane and multi-gas carriers, included 42 NGL carriers in
which our interests ranged from 25% to 100% (including seven time chartered-in NGL carriers, eight NGL carriers under construction and six time
chartered-in NGL carriers under construction).
The following table compares our natural gas liquids segment’s operating results, revenue days, calendar-ship-days and utilization for 2025 and
2024, and compares its net voyage revenues (which is a non-GAAP financial measure) for the years ended December 31, 2025 and 2024 to
income from vessel operations, the most directly comparable GAAP financial measure. With the exception of equity income, all data in this table
only includes an average of 10 NGL carriers that are accounted for under the consolidation method of accounting for the year ended December 31,
2025 (2024 – an average of 11 wholly-owned NGL carriers and six chartered-in NGL carriers). A comparison of the results from vessels accounted
for under the equity method is described below under "Equity Income".
(in thousands of U.S. Dollars, except for days 
and percentages)
Year Ended December 31,
 % Change
2025
2024
Change
Voyage revenues
114,490
144,130
(29,640)
(20.6)
Voyage expenses
(903)
(6,996)
6,093
(87.1)
Net voyage revenues(1)
113,587
137,134
(23,547)
(17.2)
Vessel operating expenses
(35,930)
(49,469)
13,539
(27.4)
Time-charter hire expenses
—
(8,237)
8,237
(100.0)
Depreciation and amortization
(32,166)
(31,325)
(841)
2.7
General and administrative expenses(2)
(3,481)
(5,686)
2,205
(38.8)
Gain on sales of vessels
—
4,339
(4,339)
(100.0)
Income from vessel operations
42,010
46,756
(4,746)
(10.2)
Equity income
25,716
27,702
(1,986)
(7.2)
Operating Data:
Calendar-Ship-Days (B)
3,650
6,158
(2,508)
(40.7)
Less:
Scheduled dry-docking days
78
46
32
69.6
Unscheduled off-hire and idle days
25
144
(119)
(82.6)
Revenue Days (A)
3,547
5,968
(2,421)
(40.6)
Utilization (A)/(B)
97.2%
96.9%
(1) This is a non-GAAP financial measure; for more information about this measure, please read "Item 5 – Operating and Financial Review and Prospects –
Non-GAAP Financial Measures".
(2) Includes direct general and administrative expenses and indirect general and administrative expenses (allocated to each segment based on estimated
use of resources). See the discussion under "Other Operating Results" below.
Our natural gas liquids segment’s total calendar-ship-days were 3,650 days in 2025 compared to 6,158 days in 2024. The decrease in total
calendar-ship-days is due to the redelivery of six chartered-in NGL carriers to their owners in December 2024 and the sales of the Seapeak Napa,
the Seapeak Cathinka, the Seapeak Camilla and the Seapeak Pan, in February 2024, March 2024, April 2024 and August 2024, respectively.
Net Voyage Revenues. Net voyage revenues decreased by $23.5 million during 2025 compared to 2024, primarily due to:
50
• a decrease of $19.6 million due to the scheduled redelivery of six time chartered-in NGL carriers to their owners in December 2024;
• a decrease of $3.1 million due to the sales of our multi-gas carriers, the Seapeak Napa, the Seapeak Cathinka, the Seapeak Camilla, and the
Seapeak Pan during 2024; and
• a decrease of $1.0 million due to an increase in scheduled dry dockings of certain of our NGL carriers during 2025.
Vessel Operating Expenses. Vessel operating expenses decreased by $13.5 million in 2025 compared to 2024, primarily due to:
• a decrease of $11.9 million due to the scheduled redelivery of six chartered-in NGL carriers to their owners in December 2024; and
• a decrease of $2.5 million due to the sales of the Seapeak Napa, the Seapeak Cathinka, the Seapeak Camilla and the Seapeak Pan during
2024;
partially offset by:
• an increase of $1.0 million due to higher seafarers' costs on certain of our NGL carriers during 2025 primarily due to the timing and location of
crew changes.
Time-Charter Hire Expenses. Time-charter hire expenses decreased by $8.2 million in 2025 compared to 2024 due to the scheduled redelivery of
six chartered-in NGL carriers to their owners in December 2024.
Gain on Sales of Vessels. Gain on sales of vessels was $4.3 million in 2024 and relates to the sales of the Seapeak Napa, the Seapeak Cathinka,
the Seapeak Camilla, and the Seapeak Pan during 2024.
Equity Income. Equity income from the Exmar LPG Joint Venture decreased by $2.0 million in 2025 compared to 2024, primarily due to:
• a decrease of $5.1 million due to a $6.5 million gain recognized on the sale of the Severin Schulte LPG carrier during 2024 and $0.9 million
due to an impairment of the right of use asset associated with the in-chartered Severin Schulte LPG carrier during 2025, as a result of a
reduction in our estimated future hire rates, partially offset by a $2.3 million gain recognized on the sale of the Sophie Schulte LPG carrier
during 2025;
• a decrease of $2.7 million due to unrealized losses on non-designated derivative instruments during 2025, compared to unrealized gains
during 2024 primarily due to changes in long-term forward benchmark interest rates; and
• a decrease of $1.3 million due to the net impact of in-charter payments for two vessels following sale-leaseback arrangements for the vessels
during 2025;
partially offset by:
• an increase of $8.1 million due to an increase in earnings related to the deliveries of the Champagny and the Courchevel LPG carriers during
2025.
Other Operating Results
The following table compares our other operating results for the years ended December 31, 2025 and 2024:
 
For the Year Ended
(in thousands of U.S. Dollars)
December 31,
2025
December 31,
2024
Change
% Change
General and administrative expenses
(34,452)
(29,088)
(5,364)
18.4
Restructuring charges
(21,927)
—
(21,927)
100.0
Interest expense
(165,350)
(178,417)
13,067
(7.3)
Interest income
12,592
14,101
(1,509)
(10.7)
Realized and unrealized (loss) gain on non-designated derivative
instruments
(14,511)
55,663
(70,174)
(126.1)
Foreign currency exchange loss
(6,236)
(1,396)
(4,840)
346.7
Other expense
(21,499)
(16,032)
(5,467)
34.1
Income tax (expense) recovery
(3,116)
2,486
(5,602)
(225.3)
Other comprehensive (loss) income
(16,918)
4,964
(21,882)
(440.8)
General and Administrative Expenses. General and administrative expenses were $34.5 million in 2025, as compared to $29.1 million in 2024. The
increase was primarily due to a discretionary compensation payment to directors and management approved by our sole common shareholder
during 2025, partially offset by a reduction in professional fees during 2025.
51
Restructuring Charges. Restructuring charges were $21.9 million in 2025 and primarily relate to severance costs resulting from the dismissal of our
Spanish seafarers. The dismissal of the seafarers followed our decision to restructure the operations of the four steam turbine LNG carriers, which
comprise our Spanish fleet, due to the adverse market conditions affecting steam turbine LNG carriers.
Interest Expense. Interest expense was $165.4 million in 2025, as compared to $178.4 million in 2024. Interest expense primarily reflects interest
incurred on our long-term debt and obligations related to finance leases. The decrease was primarily due to lower debt balances as a result of
scheduled repayments and the lower utilization of our revolving credit facility, and lower floating interest rates during 2025; partially offset by the
financing of the Marvel Swan LNG carrier during the first quarter of 2025 and the refinancing of certain of our vessels during 2024.
Realized and Unrealized (Loss) Gain on Non-designated Derivative Instruments. We have entered into interest rate swaps which exchange a
receipt of floating interest for a payment of fixed interest to reduce exposure to interest rate variability on certain of our U.S. Dollar-denominated and
our previously outstanding Euro-denominated floating rate debt. Our interest rate swaps typically require settlements every three months and the
receipt of floating interest is based on the prevailing SOFR rate at the beginning of the settlement period. Please read “Item 18 – Financial
Statements: Note 13 – Derivative Instruments and Hedging Activities" for details of our current derivative positions and a breakdown of realized and
unrealized gains (losses) relating to these non-designated interest rate swap agreements. Realized gains (losses) during a period reflect prevailing
SOFR rates that are higher (lower) than the average fixed rates of our interest rate swaps. Unrealized gains (losses) will primarily reflect an
increase (decrease) in the long-term SOFR yield curve during each relevant period. Net realized and unrealized (loss) gains on non-designated
derivative instruments were $(14.5) million and $55.7 million for 2025 and 2024, respectively, primarily due to changes in the prevailing and forward
SOFR rates during these periods.
Foreign Currency Exchange Loss. Foreign currency exchange loss was $6.2 million and $1.4 million for 2025 and 2024, respectively. These foreign
currency exchange losses were primarily due to the relevant period-end revaluation of our NOK-denominated debt and, for the year ended
December 31, 2024, our Euro-denominated term loan, for financial reporting purposes into U.S. Dollars, net of the realized and unrealized gains
and losses on our cross currency swaps. Gains and losses on NOK-denominated and Euro-denominated monetary liabilities reflect a stronger
(gains) or weaker (losses) U.S. Dollar against the NOK and Euro on the date of revaluation or settlement compared to the rate in effect at the
beginning of the period. Our cross currency swaps economically hedge all of the foreign currency and interest rate exposure on our NOK-
denominated debt. Our Euro-denominated debt was used to purchase two vessels that were on long-term charters which entitled us to payment of
charter-hire in Euros. As such, our Euro-denominated debt was repaid with these fixed Euro charter hire receipts and consequently our Euro
currency exposure was limited by this arrangement. At December 31, 2025, we have no exposure to Euro-denominated debt as it matured in
December 2024.
Other Expense. Other expense was $21.5 million in 2025, as compared to $16.0 million in 2024. The increase in other expense was primarily due to
$6.3 million in financing extinguishment gains recognized upon the repurchases of certain NGL carriers during 2024 that had been subject to sale-
leaseback arrangements.
Income Tax (Expense) Recovery. Income tax (expense) recovery was $(3.1) million in 2025, as compared to $2.5 million in 2024. The change in
income tax (expense) recovery was primarily due to changes in current and deferred tax balances related to the timing of deductions in our Tangguh
Joint Venture (in which we have a 70% ownership interest), and estimated income taxes owing related to the transfer of certain of our NGL
operations from France to Denmark; partially offset by lower freight tax estimates during 2025.
Other Comprehensive (Loss) Income. Other comprehensive (loss) income was $(16.9) million in 2025, as compared to $5.0 million in 2024. The
change in other comprehensive (loss) income was primarily due to changes in the prevailing and forward SOFR benchmark interest rates, where
the results of our joint ventures reflect the use of hedge accounting. The change in other comprehensive (loss) income was primarily due to
unrealized losses on our interest rate swap agreements in 2025, compared to unrealized gains in 2024; partially offset by lower realized gains on
our interest rate swap agreements in 2025, compared to 2024.
Year Ended December 31, 2024 versus Year Ended December 31, 2023
For a discussion of our operating results for the year ended December 31, 2024 compared with the year ended December 31, 2023, please read
"Item 5 – Operating and Financial Review and Prospects" in our Annual Report on Form 20-F for the year ended December 31, 2024.
Liquidity and Capital Resources
Sources and Uses of Capital
We generate cash flows from the charters that our vessels service. Our business strategy is to employ a substantial majority of our vessels on
fixed-rate contracts primarily with large energy companies and their transportation subsidiaries. Variability in our net operating cash flows reflects,
among other factors: changes in interest rates; fluctuations in working capital balances; the timing and the amount of dry-docking expenditures;
repairs and maintenance activities; the number of vessels in service and changes in the size of our fleet; and the timing of dividends received or
return of capital from equity-accounted investments. The number of vessel dry dockings tends to vary each period depending on our vessels'
maintenance schedules and required maintenance.
Our equity-accounted joint ventures are generally required to distribute all available cash to their owners. However, we do not have full control over
the operations of, nor do we have any legal claim to the revenue and expenses of our investments in our equity-accounted joint ventures.
Consequently, the cash flow generated by our investments in equity-accounted joint ventures may not be available for use by us in the period that
such cash flows are generated. The timing and amount of dividends distributed by our equity-accounted joint ventures are affected by the timing
and amounts of debt repayments in the joint ventures, capital requirements of the joint ventures, as well as any cash reserves maintained in the
joint ventures for operations, capital expenditures, dry-docking expenditures and/or as required under financing agreements.
52
Our sources of funds include net cash flow from operations, borrowings from debt facilities, borrowings from obligations related to finance leases,
equity contributions from our sole common unitholder, net proceeds from the issuances of debt and, to a lesser extent, the proceeds from vessel
dispositions. Certain of these sources of funds are described in "Item 18 – Financial Statements: Note 5 – Chartered-In Vessels, Note 10 – Long-
Term Debt, Note 16 – Total Capital and Note 18 – (Write-down) Gain and (Loss) Gain on Sales of Vessels".
Our primary uses of cash include the payment of operating expenses, dry-docking expenditures, costs associated with modifications to our vessels,
committed capital expenditures, debt service costs, interest rate swap and cross currency swap settlements, scheduled repayments of long-term
debt, scheduled repayments of our obligations related to finance leases, periodic distributions, including payments of distributions on our common
units and Series A and Series B Preferred Units, and funding any preferred unit repurchases we may undertake, as well as funding our other
working capital requirements. In addition, we use cash to acquire or build vessels to grow the size of our fleet or make investments in our equity-
accounted joint ventures for them to acquire or build vessels. The timing of any newbuilding vessel orders or vessel acquisition activity may vary
significantly from year to year.
Our revolving credit facility, term loans and bonds, and obligations related to finance leases are described in "Item 18 – Financial Statements: Note
5 – Chartered-In Vessels and Note 10 – Long-Term Debt." Our revolving credit facility, term loans and bonds, and obligations related to finance
leases contain covenants and other restrictions typical of debt financing secured by vessels, which restrict the vessel-owning or lessee subsidiaries
from:
• incurring or guaranteeing indebtedness;
• changing ownership or structure, including mergers, consolidations, liquidations and dissolutions;
• paying dividends or distributions if they are in default;
• making capital expenditures in excess of specified levels;
• making certain negative pledges and granting certain liens;
• selling, transferring, assigning or conveying assets;
• making certain loans and investments; and
• entering into a new line of business.
Certain of our credit facilities and obligations related to finance leases require us to maintain financial covenants. If we do not meet these financial
covenants, the lender or lessor may limit our ability to borrow additional funds under our credit facilities and accelerate the repayment of our
revolving credit facility, term loans and bonds, and obligations related to finance leases, which would have a significant impact on our short-term
liquidity requirements. The terms of and compliance with these financial covenants are described in further detail in "Item 18 – Financial
Statements: Note 5 – Chartered-In Vessels and Note 10 – Long-Term Debt" included in this Report. Certain of our credit facilities and obligations
related to finance leases require us to make interest payments based on NIBOR or SOFR. Significant increases in interest rates could adversely
affect results of operations and our ability to service our debt; however, as part of our strategy to minimize financial risk, we use interest rate swaps
and cross currency swaps to reduce our exposure to market risk from changes in interest rates. Our current positions are described in further detail
in "Item 18 – Financial Statements: Note 13 – Derivative Instruments and Hedging Activities" and the extent of our exposure to changes in interest
rates is described in further detail in "Item 11 – Quantitative and Qualitative Disclosures About Market Risk”.
In addition to our debt and finance lease obligations, we also guarantee our proportionate share of certain loan facilities and obligations on interest
rate swaps for certain of our equity-accounted joint ventures. As at December 31, 2025, this proportionate share, based on the aggregate principal
amount of the loan facilities and fair value of the interest rate swaps, was $768.3 million. As at December 31, 2025, our equity-accounted joint
ventures were in compliance with all covenants relating to these loan facilities that we guarantee.
Cash Flows
The following table summarizes our consolidated cash and cash equivalents provided by (used for) operating, financing and investing activities for
the periods presented:
(in thousands of U.S. Dollars)
Year Ended December 31,
 
2025
2024
Net cash flow from operating activities
272,859
395,288
Net cash flow used for financing activities
(266,480)
(191,647)
Net cash flow used for investing activities
(49,193)
(200,067)
Net Operating Cash Flow
Net cash flow from operating activities decreased by $122.4 million to $272.9 million in 2025 from $395.3 million in 2024, primarily due to: a
$63.1 million decrease in income from vessel operations excluding write-downs, restructuring charges, and depreciation and amortization in 2025; a
$35.4 million decrease due to the timing of settlements of non-cash working capital in 2025 compared to 2024; and $21.1 million in restructuring
charges incurred during 2025 relating to severance costs for our Spanish seafarers.
53
Net Financing Cash Flow
Net cash flow used for financing activities increased by $74.8 million to $266.5 million in 2025 from $191.6 million in 2024, primarily due to: a
$323.2 million net decrease in proceeds from the refinancing of certain of our LNG and NGL carriers during 2025; and a $111.9 million scheduled
repayment of certain of our NOK-denominated bonds, which matured in 2025. These increases in cash used for financing activities were partially
offset by a $206.8 million drawdown of term loans used as partial funding of the installment payments for the five LNG carrier newbuildings
scheduled for deliveries in 2027; and a $150.0 million decrease in cash distributions to our sole common unit holder, Stonepeak, in 2025.
Net Investing Cash Flow
Net cash flow used for investing activities decreased by $150.9 million to $49.2 million in 2025 from $200.1 million in 2024 due to: a $196.5 million
decrease in cash expenditures for vessels and equipment, including advances on newbuilding contracts during 2025 primarily related to our
acquisition of the Marvel Swan LNG carrier in 2024, partially offset by an increase in shipyard installment payments for certain of our LNG carrier
newbuildings in 2025. This decrease in cash used for investing activities was partially offset by a $30.0 million return of capital from the Angola Joint
Venture in 2024 and a $15.6 million decrease in net proceeds from the sale of vessels in 2025.
Liquidity
Our primary sources of liquidity are cash and cash equivalents, net operating cash flow provided by our operations, cash distributions we receive
from our equity-accounted joint ventures, the undrawn portion of our credit facility, and capital raised through financing transactions. Our cash
management policies have a primary objective of minimizing both the probability of loss and return volatility, as well as ensuring that securities
purchased can be sold readily and efficiently. A secondary objective is ensuring an appropriate return. The nature and extent of amounts that can be
borrowed under our revolving credit facility are described in "Item 18 – Financial Statements: Note 10 – Long-Term Debt" of this Annual Report.
Our total liquidity, which consists of cash, cash equivalents and the undrawn portion of our credit facility, was $337.9 million as at December 31,
2025, compared to $338.7 million as at December 31, 2024.
The following table summarizes our contractual obligations as at December 31, 2025, excluding those of our equity-accounted joint ventures. We
expect that our liquidity at December 31, 2025, combined with the operating cash flows we expect to generate from customer contracts in place at
December 31, 2025, the cash distributions we expect to receive from our equity-accounted joint ventures, and the proceeds we expect to receive
related to the refinancing of one of our LNG carriers and the financing of certain of our LNG carrier newbuildings, will be sufficient to pay our
obligations coming due in 2026. Our ability to pay our obligations and to refinance our long-term debt and finance leases coming due subsequent to
December 31, 2026 will depend on, among other things, our ability to continue to service our long-term charter contracts, our financial condition and
the condition of credit markets in the months leading up to the maturity dates. We may expand the size of our fleet through the acquisition of new or
second-hand vessels or through the construction of additional new vessels. Our ability to continue to expand the size of our fleet over the long-term
is dependent upon our ability to generate operating cash flow, obtain long-term bank borrowings, sale-leaseback financings and other debt, as well
as our ability to raise equity financing, either from internally generated sources, or from our sole common unit holder.
Total
2026
2027
2028
2029
2030
Beyond
2030
 
(in millions of U.S. Dollars)
U.S. Dollar long-term debt principal
799.9
198.0
377.7
54.7
45.5
124.0
—
Norwegian Kroner long-term debt principal (1)
99.1
99.1
—
—
—
—
—
Commitments related to finance leases (2)
2,223.7
328.5
396.3
366.6
210.7
295.6
626.0
Commitments related to operating leases (3)
92.3
28.4
28.4
29.6
5.9
—
—
Newbuilding installments/shipbuilding supervision (4)(5)
1,393.8
295.1
792.3
306.4
—
—
—
Totals
4,608.8
949.1
1,594.7
757.3
262.1
419.6
626.0
(1) NOK-denominated obligations are presented in U.S. Dollars and have been converted using the prevailing exchange rates as of December 31, 2025.
(2) Includes, in addition to lease payments, amounts to purchase the leased vessels at the end of their respective lease terms. Where applicable,
accelerated timing of repayments may be required if we are not in compliance with certain covenants under our lease agreements.  
(3) We have corresponding leases whereby we are the lessor and expect to receive approximately $69.1 million under these leases from 2026 to 2029.
(4) During November 2022, we entered into contracts with Samsung Heavy Industries Co., Ltd. for the construction of five 174,000-cubic meter M-type,
Electronically Controlled, Gas Admission propulsion LNG carriers, which are scheduled to deliver throughout 2027. We intend to finance substantially all
of the remaining estimated pre-delivery expenditures with borrowings under two U.S. Dollar-denominated term loans maturing in 2027. In addition, the
final construction installments due on delivery and the repayment of the two U.S. Dollar-denominated term loans maturing in 2027 will be financed with
10-year sale and leaseback financing arrangements, where the LNG carrier newbuildings will be sold to a third party upon their delivery for
approximately $235.0 million per vessel and leased back to us.
(5) During December 2025, we entered into contracts with Samsung Heavy Industries Co., Ltd. for the construction of two 174,000-cubic meter low-
pressure dual-fueled (X-DF) LNG carrier newbuildings, which are scheduled for deliveries in the second half of 2028. We intend to finance the estimated
costs with our existing liquidity and future operating cash flow, as well as short and long-term debt financing to be arranged for the vessels prior to their
scheduled deliveries.
54
In addition to the commitments in the table above, our equity-accounted joint ventures have commitments to fund newbuilding and other
construction contract costs all of which are non-recourse to us. See "Item 18 – Financial Statements: Note 14 – Commitments and Contingencies"
included in this Annual Report.
Critical Accounting Estimates
We prepare our consolidated financial statements in accordance with United States generally accepted accounting principles (or GAAP), which
require us to make estimates in the application of our accounting policies based on our best assumptions, judgments and opinions. On a regular
basis, management reviews the accounting policies, assumptions, estimates and judgments to ensure that our consolidated financial statements
are presented fairly and in accordance with GAAP. However, because future events and their effects cannot be determined with certainty, actual
results could differ from our assumptions and estimates, and such differences could be material. Accounting estimates and assumptions discussed
in this section are those that we consider to be the most critical to an understanding of our financial statements, because they inherently involve
significant judgments and uncertainties. For a further description of our material accounting policies, please read “Item 18 – Financial Statements:
Note 1 – Summary of Significant Accounting Policies.”
Vessel Depreciation
Description. The carrying value of each of our vessels represents its original cost at the time of delivery or purchase less depreciation and
impairment charges. We depreciate the original cost, less an estimated residual value, of our vessels on a straight-line basis over each vessel’s
estimated useful life. The carrying values of our vessels may not represent their market value at any point in time because the market prices of
second-hand vessels tend to fluctuate with changes in charter rates, the cost of newbuildings, among other factors. Both charter rates and
newbuilding costs tend to be cyclical in nature.
Judgments and Uncertainties. For the years ended December 31, 2025, 2024, and 2023, depreciation was calculated using an estimated useful life
of 35 years for LNG carriers and 30 years for NGL carriers, commencing the date the vessel is delivered from the shipyard, or a shorter period if
regulations prevent us from operating the vessels for those periods of time. The estimated useful life of our vessels involves an element of
judgment, which takes into account design life, commercial considerations and regulatory restrictions. As at January 1, 2025, our LNG segment
included seven steam turbine LNG carriers, the oldest vessels in our LNG fleet. We have made downward revisions to the outlook for this class of
older vessel based on a combination of an oversupply of this type of vessel and reduced charterer interest due to their less efficient design. As
such, we reduced our estimate of their useful lives from 35 years to 25 years, effective January 1, 2025. In October 2025, we further reduced the
estimated useful lives of three steam turbine LNG carriers from 25 to 20 years due to a lower near-term outlook for these vessels. During the year
ended December 31, 2025, one of these seven steam vessels was sold and another two of these vessels were held for sale as at December 31,
2025 and subsequently sold during the first quarter of 2026.
Other Information. The actual life of a vessel may be different than the estimated useful life, with a shorter actual useful life resulting in an increase
in annual depreciation expense. A longer actual useful life will result in a decrease in annual depreciation expense. Excluding our seven steam LNG
carriers, if we had depreciated our LNG carriers using an estimated useful life of 30 years instead of 35 years effective at the beginning of the fiscal
year, our depreciation for the year ended December 31, 2025 would have increased by $11.8 million (2024 – $27.6 million). If we had depreciated
our NGL carriers using an estimated useful life of 25 years instead of 30 years effective at the beginning of the fiscal year, our depreciation for the
year ended December 31, 2025 would have increased by $6.9 million (2024 – $6.5 million).
Vessel Impairment
Description. We review vessels and equipment for impairment whenever events or circumstances indicate the carrying value of an asset, including
the carrying value of the charter contract, if any, under which the vessel is employed, may not be recoverable. This occurs when the asset’s carrying
value is greater than the future undiscounted cash flows the asset is expected to generate over its remaining useful life. If the estimated future
undiscounted cash flows of an asset exceed the asset’s carrying value, no impairment is recognized. If the estimated future undiscounted cash
flows of an asset are less than the asset’s carrying value and the fair value of the asset is less than its carrying value, the asset is written down to its
fair value. The estimated fair value is determined using discounted cash flows or appraised values. In cases where an active second-hand sale and
purchase market does not exist, we use a discounted cash flow approach to estimate the fair value of an impaired vessel. In cases where an active
second-hand sale and purchase market exists, an appraised value is used to estimate the fair value of an impaired vessel. An appraised value is
generally the amount we would expect to receive if we were to sell the vessel. Such appraisal is normally completed by us and is based on second-
hand sale and purchase data, and other information provided by third parties. For a vessel under charter, the discounted cash flows from that
vessel may exceed its market value, as market values may assume the vessel is not employed on an existing charter.
Judgments and Uncertainties. In periods where events or circumstances indicate the carrying value of a vessel may not be recoverable, which will
involve judgments about the future employment of a vessel, and estimates of future undiscounted cash flows are determined, our estimates of
future cash flows will involve assumptions about future charter rates, vessel utilization, operating expenses, dry-docking expenditures, vessel
residual values and the remaining estimated life of our vessels. Our estimated charter rates are based on rates under existing vessel contracts and
market rates at which we expect we can re-charter our vessels. Such market rates are based on a 10-year historical industry average of charter
rates taking into account the propulsion type and size of the vessel, except for LNG carriers with a steam turbine propulsion system in which case
our estimate is based on the charter rates in the remaining duration of the firm period of existing charters, as a historical industry average is no
longer believed to be appropriate due to the combination of an oversupply of this type of vessel and reduced charterer interest due to their less
efficient design.
Our estimates of vessel utilization, including estimated off-hire time, are based on historical experience. Our estimates of operating expenses and
dry-docking expenditures are based on historical operating and dry-docking costs and our expectations of future inflation and operating
requirements. Vessel residual values are a product of a vessel’s lightweight tonnage and an estimated scrap rate. The remaining estimated lives of
our vessels used in our estimates of future cash flows are consistent with those used in the calculation of depreciation.
55
In our experience, certain assumptions relating to our estimates of future cash flows are more predictable by their nature, including estimated
revenue under existing contract terms and on-going operating costs. Certain assumptions relating to our estimates of future cash flows require
more judgment and are inherently less predictable, such as the estimated daily hire rate on rechartering as well as the probability of vessel sales. In
addition, in situations where we value a vessel and its associated charter contract using a discounted cash flow approach, the determination of the
discount rate requires judgment. We believe that the assumptions used to estimate future cash flows of our vessels and the discount rate are
reasonable at the time they are made. We can make no assurances, however, as to whether our estimates of future cash flows, particularly future
vessel charter rates or vessel values, will be accurate.
Other Information. If we conclude that a vessel or equipment is impaired, we recognize a loss in an amount equal to the excess of the carrying
value of the asset over its fair value at the date of impairment. The written-down amount becomes the new lower cost basis and will result in a lower
annual depreciation expense in periods subsequent to the vessel impairment. Consequently, any changes in our estimates of future undiscounted
cash flows may result in a different conclusion as to whether a vessel or equipment is impaired, leading to a different impairment amount, including
no impairment, and a different future annual depreciation expense.
Our business model is to employ our vessels on fixed-rate contracts primarily with large energy companies and their transportation subsidiaries.
These contracts generally have original terms between five to 25 years in length. Consequently, while the market value of a vessel may decline
below its carrying value, the carrying value of a vessel may still be recoverable based on the future undiscounted cash flows the vessel is expected
to obtain from servicing its existing contract and future contracts.
The 20-year charters for three of our steam turbine LNG carriers, consisting of the RasGas II Joint Venture vessels, are scheduled to expire during
October 2026 to February 2027. Steam turbine LNG carriers are currently facing acute market pressure amid weak demand and a record number of
such vessels are currently inactive. The outlook for these vessels is not expected to significantly improve by late-2026 and early-2027. Therefore, it
is expected that the RasGas II Joint Venture vessels will be sold, unless a suitable charter can be found prior to the expiration of their existing
charters. As a result, in September 2025, the carrying values of these vessels were written down to their estimated fair values. The total impairment
charge of $60.1 million is included in (write-down) gain and (loss) gain on sales of vessels for the year ended December 31, 2025 in our
consolidated statements of income (loss). The vessels were written down to their estimated fair values using a discounted cash flow approach
based on the vessels operating to age 20 years on their existing long-term fixed-rate charter contracts and their subsequent sale at a price which is
based on recent transactions for LNG carriers of a similar age. To the extent the vessels are sold at the end of their existing charter contracts and
the actual sales price is lower than the expected sales price, a further impairment charge would be recognized.
As of December 31, 2025, we estimate that we had one LNG carrier whose estimated market value of $200.0 million was $34.1 million less than its
carrying value of $234.1 million. While the estimated market value of this vessel may be below its carrying value, no impairment has been
recognized as the estimated future undiscounted cash flows relating to such vessel is greater than its carrying value. Vessels with estimated future
cash flows significantly greater than their respective carrying values, like this vessel, would likely only be impaired in the next 12 months if we
decided to dispose of this vessel, along with its charter contract, instead of continuing to operate it. In deciding whether to dispose of a vessel, we
determine whether it is economically preferable to sell a vessel or continue to operate it. This assessment includes an estimation of the net
proceeds expected to be received if a vessel is sold in its existing condition compared to the present value of the vessel’s estimated future revenue,
net of operating costs. Such estimates are based on the terms of its existing charter, charter market outlook, estimated future vessel values and
estimated operating costs, given the vessel’s type, condition and age. In addition, we typically do not dispose of a vessel that is servicing an existing
customer contract.
Impairment of Investments in Equity-Accounted Joint Ventures
Description. We evaluate our investments in equity-accounted joint ventures for impairment when events or circumstances indicate that the carrying
value of such investments may have experienced an other-than-temporary decline in value below its carrying value. If this is the case, the carrying
value of the investment in equity-accounted joint venture is written down to its estimated fair value and the resulting impairment is recognized in our
consolidated statement of income (loss).
Judgments and Uncertainties. The process of evaluating the potential impairment of investments in equity-accounted joint ventures requires
significant judgment in determining whether the estimated value of an investment in an equity-accounted joint venture has declined below its
carrying value and if so, whether this is an other-than-temporary decline in value. Such judgments include, among other things, estimates of future
charter rates, operating expenses and vessel values, timing of vessels sales, discount rates and deliveries and future growth prospects. In
determining whether an impairment of an equity method investment is other-than-temporary, factors to consider include the length of time and
extent to which the fair value of the investment is less than its carrying value; the financial condition and near-term prospects of the equity method
investee, including recent operating losses or specific events that may negatively influence the future earnings potential of the investee; and the
intent and ability of the holder to retain its investment in the investee for a period of time sufficient to allow for any anticipated recovery in market
value. As at December 31, 2025, we conducted an impairment test for our investment in the MALT Joint Venture and determined that while its
estimated fair value had declined below its carrying value, such decline was not other-than-temporary.
56
Other Information. If we determine that an investment in an equity-accounted joint venture is impaired, we recognize a loss in an amount equal to
the excess of the carrying value of the investment over its estimated fair value at the date of impairment. The written-down amount becomes the
new lower cost basis of the investment. In addition, we may assign the impairment to individual assets held by the equity-accounted joint venture,
such as vessels and equipment, and this would result in an increase in our proportionate share of comprehensive earnings of the joint venture in
future periods due to lower depreciation expense of the vessels and equipment of the equity-accounted joint venture. Consequently, differences in
conclusions about whether an investment in an equity-accounted joint venture is impaired and the amount of such impairment may result in a
different impairment amount, including no impairment, and a different equity income (loss) in future periods. Had we determined that the decline in
the estimated fair value of our investment in the MALT Joint Venture below its carrying value was other-than-temporary, an impairment loss of
approximately $50 million would have been recognized for the year ended December 31, 2025. Since vessel values and the LNG market can be
volatile, the estimated fair value of our investment in the MALT Joint Venture in future periods may be materially different than such amount at
December 31, 2025. Consequently, any future impairment loss, if any, may be materially different than the impairment loss that would have been
recognized for the year ended December 31, 2025 had we determined that the decline in the estimated fair value of our investment in the MALT
Joint Venture below its carrying value was other-than-temporary.
Valuation of Derivative Instruments
Description. Our risk management policies permit the use of derivative financial instruments to manage interest rate risk, and foreign exchange risk.
Changes in fair value of derivative financial instruments that are not designated as cash flow hedges for accounting purposes are recognized in
earnings.
Judgments and Uncertainties. A substantial majority of the fair value of our derivative instruments and the change in fair value of our derivative
instruments from period to period result from our use of interest rate and cross currency swap agreements. The fair value of our derivative
instruments is the estimated amount that we would receive or pay to terminate the agreements at the reporting date, taking into account current
interest rates and the current credit worthiness of both us and the swap counterparties. The estimated amount is the present value of estimated
future cash flows, being equal to the difference between the benchmark interest rate and the fixed rate in the interest rate and cross currency swap
agreement, multiplied by the notional principal amount of the interest rate and cross currency swap agreement at each interest reset date.
The fair value of our interest and cross currency swap agreements at the end of each period is most significantly affected by the interest rate
implied by the benchmark interest yield curve, including its relative steepness, and forward foreign currency exchange rates. Interest rates and
foreign currency exchange rates have experienced significant volatility in recent years in both the short and long term. While the fair value of our
interest and cross currency swap agreements is typically more sensitive to changes in short-term rates, significant changes in the long-term
benchmark interest and foreign currency exchange rates also materially impact our interest and cross currency swap agreements.
The fair value of our interest and cross currency swap agreements is also affected by changes in our credit risk or counterparty credit risk included
in the discount factor. We discount our interest rate swap and cross currency swap obligations with reference to the credit default swap spreads of
similarly rated global industrial companies and by considering any underlying collateral. We discount our interest rate swap and cross currency
swap assets with reference to the credit default swap spreads of the counterparty financial institutions. The process of determining credit worthiness
requires significant judgment in determining which source of credit risk information most closely matches the risk profile of the entity being
assessed.
The benchmark interest rate yield curve and our specific credit risk are expected to vary over the life of the interest and cross currency swap
agreements. The larger the notional amount of the interest rate and cross currency swap agreements outstanding and the longer the remaining
duration of the interest rate and cross currency swap agreements, the larger the impact of any variability in these factors will be on the fair value of
our interest and cross currency swaps. We economically hedge the interest rate exposure on a significant amount of our long-term debt and for long
durations. As such, we have historically experienced, and we expect to continue to experience, material variations in the period-to-period fair value
of our derivative instruments.
Other Information. Although we measure the fair value of our derivative instruments utilizing the inputs and assumptions described above, if we
were to terminate the agreements at the reporting date, the amount we would pay or receive to terminate the derivative instruments may differ from
our estimate of fair value. If the estimated fair value differs from the actual termination amount, an adjustment to the carrying amount of the
applicable derivative asset or liability would be recognized in earnings for the current period. Such adjustments could be material. See “Item 18 –
Financial Statements: Note 13 – Derivative Instruments and Hedging Activities” for the effects on the change in fair value of our derivative
instruments on our consolidated statements of income (loss) and statements of comprehensive income (loss).
Credit Losses
We apply a credit loss methodology which utilizes a lifetime expected credit loss measurement objective for the recognition of credit losses for net
investments in direct financing and sales-type leases, loans to equity-accounted joint ventures, guarantees of secured loan facilities of equity-
accounted joint ventures, non-operating lease accounts receivables, contracts assets and other receivables at the time the financial asset is
originated or acquired. The expected credit losses are subsequently adjusted each period for changes in expected lifetime credit losses.
A substantial majority of our exposure to potential credit losses relates to our direct financing and sales-type leases, including those within our
equity-accounted joint ventures. See "Item 18 – Financial Statements: Note 3b – Credit Losses" for a description of these direct financing and sales-
type leases.
57
Judgments and Uncertainties. GAAP gives entities the flexibility to select an appropriate method to measure the estimate of expected credit losses.
That is, entities are permitted to use estimation techniques that are practical and relevant to their circumstances, as long as they are applied
consistently over time and aim to faithfully estimate expected credit losses. We have determined the credit loss provision related to the lease
receivable component of the net investment in direct financing and sales-type leases using an internal historical loss rate method. We concluded
that using a loss rate method which is primarily based on internal historical data is inherently more representative than primarily using external data,
which may include all industries, or all oil and gas or all marine transportation, which are not as comparable. In addition, a substantial majority of our
customers are private single-purpose entities or subsidiaries or joint ventures of larger listed-entities that do not publish financial information nor do
they have published credit ratings determined by credit rating agencies. In the limited circumstances where relevant and reliable external data is
available and where judged to be appropriate, we have considered such data in making adjustments to our internally derived loss rate. Judgment is
required to determine the applicability and reliability of the external data used. The credit loss provision for the residual value component of net
investment in direct financing and sales-type leases is based on the current estimated fair value of the vessel as depreciated to the end of the
charter contract as compared to the expected carrying value, with such potential gain or loss on maturity being included in the credit loss provision
in increasing magnitude on a straight-line basis the closer the contract is to its maturity. Given the volatility in vessel values, the selection of the
method to estimate the credit loss provision for the residual value component involves judgment.
We believe that the assumptions used to estimate our expected credit losses are reasonable at the time they are made. We can make no
assurances, however, as to whether our estimates will be accurate.
In addition to the judgment used in selecting the methods to measure the credit loss provision, there is also judgment used in applying the methods.
We have used judgment in determining whether or not the risk characteristics of a specific direct financing lease or sales-type lease at the
measurement date are consistent with those used to measure the internal historical loss rate, and to determine whether we expect current
conditions and reasonable and supportable forecasts to differ from the conditions that existed to measure the internal historical loss rate. In
addition, judgment has been used to determine the internal historical loss rate, as it is based in part on estimates of the occurrence or non-
occurrence of future events which will dictate the amount of recoveries earned or additional losses incurred associated with known losses incurred
to date. Judgment has also been used to determine the adjustment required to the internal historical loss rate, in those circumstances where
relevant and reliable external data was identified. Furthermore, the current estimated fair value of the vessels used in our estimate of expected
credit losses for direct financing and sales-type leases has been determined based on appraised values, such appraised values are normally
completed by us using second-hand sale and purchase data and other information provided by third parties. Judgment is used when vessels sold
are different in age, size and technical specifications compared to our vessels. Since vessel values can be volatile, our estimates of residual value
may not be indicative of either the current or future prices we could obtain if we sold any of the vessels.
Other Information. To the extent the methods, and judgments used in applying these methods, that we use to measure our estimate of expected
credit losses results in a credit loss provision that is different from actual results, our credit loss provision at the end of each period and the change
in the credit loss provision in each period will be different than what would have otherwise been. As at December 31, 2025, 2024, and 2023, the
unadjusted internal historical loss rates were 1.5%, 1.1% and 1.0%, respectively. The increase in the unadjusted internal historical loss rate in 2025
was the result of a reduction in LNG carrier charter rates in 2025. Had we used the same unadjusted internal historical loss rate in 2025 that was
used in 2024, our 2025 net loss before non-controlling interest would have decreased by $4.9 million. In addition, if we had increased (decreased)
our estimates of the residual value of the vessels by 5%, our 2025 net loss before non-controlling interest would have increased or decreased by
$12.2 million.
Non-GAAP Financial Measures
Net Voyage Revenues
Net voyage revenues is a non-GAAP financial measure. Consistent with general practice in the shipping industry, we use net voyage revenues as a
measure of equating revenues generated from voyage charters to revenues generated from time-charters, which assists us in making operating
decisions about the deployment of our vessels and their performance. Since, under time-charters, the charterer pays the voyage expenses,
whereas under voyage charters, the shipowner pays these expenses, we include voyage expenses in net voyage revenues. Some voyage
expenses are fixed, and the remainder can be estimated. If we, as the shipowner, pay the voyage expenses, we typically pass on to our customers
the approximate amount of these expenses by charging higher rates under the contract or billing the expenses to them. As a result, although
voyage revenues from different types of contracts may vary, the net voyage revenues are generally comparable across the different types of
contracts. We principally use net voyage revenues because it provides more meaningful information to us than voyage revenues. Net voyage
revenues is also widely used by investors and analysts in the shipping industry for comparing financial performance between companies and to
industry averages.
How we use net voyage revenues and the reasons for such use may be unique to the shipping industry. Given that net voyage revenues is a
measure which deducts certain operating expenses from revenue, this metric may be more commonly viewed as an alternative measure of gross
profit. Viewed in this context, income (loss) from operations would be the most directly comparable GAAP financial measure and net voyage
revenues has been defined as income (loss) from vessel operations before restructuring charges, write-down (gain) and loss (gain) on sales of
vessels, general and administrative expenses, depreciation and amortization, time-charter hire expenses and vessel operating expenses. The
following table reconciles net voyage revenues with income (loss) from vessel operations:
58
Year Ended December 31, 2025
Year Ended December 31, 2024
(in thousands of U.S. Dollars)
LNG
Segment
$
NGL
Segment
$
Total
$
LNG
Segment
$
NGL
Segment
$
Total
$
Income (loss) from vessel operations
88,860
42,010
130,870
(141,261)
46,756
(94,505)
Restructuring charges
21,927
—
21,927
—
—
—
Write-down and loss (gain) on sales of vessels
71,006
—
71,006
387,109
(4,339)
382,770
General and administrative expenses
30,971
3,481
34,452
23,402
5,686
29,088
Depreciation and amortization
111,816
32,166
143,982
111,339
31,325
142,664
Time-charter hire expenses
—
—
—
—
8,237
8,237
Vessel operating expenses
186,710
35,930
222,640
181,427
49,469
230,896
Net voyage revenues
511,290
113,587
624,877
562,016
137,134
699,150
EBITDA
EBITDA is a non-GAAP financial measure. EBITDA represents net income (loss) before interest, taxes and depreciation and amortization. EBITDA
is used as a supplemental financial performance measure by management and by external users of our financial statements, such as investors.
EBITDA assists our management and security holders by increasing the comparability of our fundamental performance from period to period and
against the fundamental performance of other companies in our industry that provide EBITDA information. We believe that including EBITDA
benefits investors in (a) selecting between investing in us and other investment alternatives and (b) monitoring our ongoing financial and operational
strength and health in assessing whether to continue to hold our equity or any debt securities, as applicable.
EBITDA should not be considered as an alternative to net income (loss), operating income, or any other measure of financial performance
presented in accordance with GAAP. EBITDA excludes certain items that affect net income (loss). The following table reconciles our historical
consolidated EBITDA to net income (loss):
(in thousands of U.S. Dollars)
Year Ended
December 31,
2025
$
Year Ended
December 31,
2024
$
Reconciliation of “EBITDA” to “Net income (loss)”:
Net income (loss)
25,991
(95,821)
Depreciation and amortization
143,982
142,664
Interest expense, net of interest income
152,758
164,316
Income tax expense (recovery)
3,116
(2,486)
EBITDA
325,847
208,673
Item 6. Directors, Senior Management and Employees
Our Board and our executive officers oversee and supervise our operations. All Board members are appointed only by holders of a majority of our
outstanding common units, other than a limited right for our preferred unitholders to appoint a Preferred Unit Elected Director. Otherwise, no
common or preferred unitholder has any management power or control over our business or affairs. The Board currently includes four non-
independent directors, including three non-independent directors who also serve as officers, directors or employees of Stonepeak and its other
affiliates, and one director who is also a member of our management. Consequently, these directors may encounter situations in which their
fiduciary obligations to Stonepeak or its other affiliates, on the one hand, and any obligation to us or our preferred unitholders, on the other hand,
are in conflict.
Directors and Executive Officers of Seapeak LLC
The following table provides information about the Board and executive officers of Seapeak LLC, as at the date of this Annual Report. Directors are
appointed to serve until their successors are appointed or until they resign or are removed. The business address of each of our directors listed
below is c/o 2000, 550 Burrard Street, Vancouver, B.C., Canada, V6C 2K2. Ages of the individuals are as of December 31, 2025.
59
Name
Age
Position
James Wyper
36
Director and Chair
Hajir Naghdy
51
Director
Ben Norton
30
Director
Barry Curtis
67
Director (1)
Lisa Krueger
62
Director (2)
Mark Kremin
55
President and Chief Executive Officer, Director
Scott Gayton
51
Chief Financial Officer
Kate Ferguson
40
Vice President, Business Development (3)
Chris McDade
45
Vice President, Operations
Nathan Kim
42
General Counsel
(1) Chair of Audit Committee and member of Conflicts Committee.
(2) Chair of Conflicts Committee and member of Audit Committee.
(3) In July 2025, Kate Ferguson was appointed as Vice President, Business Development, replacing Andres Luna, our former Vice President, Commercial,
who retired in June 2025.
Certain biographical information about each of these individuals included in the table above is set forth below:
James Wyper has been a director of Seapeak LLC and the Chair of the Board since January 2022. Mr. Wyper is a Senior Managing Director with
Stonepeak Infrastructure Partners and is responsible for the firm’s investments in transportation, logistics and LNG. He is a member of the boards
of directors of Textainer, Venture Global Calcasieu Pass, Lineage Logistics, TRAC Intermodal, Lonestar Holdings, and Oregon Trail Ventures, and
formerly was a director of Carlsbad Desalination Project, Tidewater Holdings, and Golar Power Ltd. Prior to joining Stonepeak, Mr. Wyper was a
member of Credit Suisse’s global energy group, where he focused on the power and renewables sectors.
Hajir Naghdy has been a director of Seapeak LLC since January 2022. Mr. Naghdy is a Senior Managing Director with Stonepeak Infrastructure
Partners, responsible for the firm’s investments and operations in the Asia-Pacific region, and he is also a member of the Stonepeak Executive
Committee. Prior to joining Stonepeak, Mr. Naghdy was employed at Macquarie Capital for 19 years. He started with Macquarie in Sydney in 1999
and moved to Korea in 2000, as a founding member of the team which established Macquarie’s first infrastructure funds management business in
Asia. Mr. Naghdy played a leading role in 12 of the first 14 investments made by the Macquarie Korean Infrastructure Fund (formerly the Korea
Road Infrastructure Fund) between 2002 and 2005. He has played numerous roles across Asia and the Middle East in Macquarie’s infrastructure
business. Prior to joining Stonepeak, Mr. Naghdy was Head of Macquarie Capital in Asia and the Middle East. In this role, he led and established
Macquarie Capital’s renewable energy investing business in the region.
Ben Norton has been a director of Seapeak LLC since February 2024. Mr. Norton is a Vice President with Stonepeak Infrastructure Partners. Prior
to joining Stonepeak, Mr. Norton was an analyst at Greenhill where he focused on M&A and restructuring advisory within the energy industry.
Barry Curtis has been a director of Seapeak LLC since January 2022 and serves as the Chair of the Audit Committee and member of the Conflicts
Committee. Mr. Curtis recently retired after 23 years as a Deloitte partner. Mr. Curtis served as Deloitte’s National Managing Partner - Private Equity
for 12 years, and as Chief Risk Officer for M&A and as a member of the broader firm’s Operating Risk Committee for six years. He also has
extensive experience in global M&A, having worked with leading private equity firms and corporations on their buy-side and sell-side transactions,
as well as on portfolio company financial reporting, audit and risk management matters. Prior to joining Deloitte, Mr. Curtis spent four years as Chief
Financial Officer of two privately-held businesses, as well as having served as a director and as the audit committee chair for Ernst Home Centers,
a then publicly-traded NYSE-listed company. He began his career and spent ten years at PWC, the last three years as an audit partner. Mr. Curtis is
a Certified Public Accountant.
Lisa Krueger has been a director of Seapeak LLC since April 2022 and serves as the Chair of the Conflicts Committee and member of the Audit
Committee. In addition, Ms. Krueger is a Managing Director at Global Infrastructure Partners where she serves as a Director for Skyborn
Renewables and is on the Investment Committee and Chairs the ESG Committee. Ms. Krueger has 35 years of diverse experience in the energy
industry and served as a member of the board of directors of Fluence Energy Inc. from September 2021 to September 2022. Ms. Krueger
previously served as Executive Vice President and President of the US strategic business unit of The AES Corporation and President and Chief
Executive Officer of Essential Power LLC. Prior to joining Essential Power LLC, Ms. Krueger was a senior officer at First Solar and held several
executive-level positions with Dynegy Inc. and Illinois Power Company.
Mark Kremin was appointed as President and Chief Executive Officer of the Company in 2017 and has served as a director of Seapeak LLC since
January 2022. He had previously been appointed as President of Teekay Gas Services in 2015, having acted as its Vice President since 2006. Mr.
Kremin joined Teekay Corporation as in-house counsel in 2000, and subsequently held various commercial roles within Teekay Gas. He now
represents Seapeak on the boards of directors of joint ventures with partners in Asia, Europe and the Middle East. Mr. Kremin has over 20 years’
experience in shipping. Prior to joining Teekay, he was an attorney in an admiralty law firm in Manhattan. Prior to attending law school in New York
City, he worked for a leading owner and operator of container ships.
Scott Gayton was appointed as Chief Financial Officer of the Company in 2018. Mr. Gayton has over 25 years of finance and accounting
experience, including serving as Chief Financial Officer of Tanker Investments Ltd. from the time of its initial public offering in 2014 until its sale in
2017. Mr. Gayton joined Teekay Corporation in 2001 and worked in progressively more senior roles in Finance and Accounting. In 2013, he was
promoted to Vice President, Finance where he supported Teekay’s strategy and capital markets transactions. He now represents Seapeak on the
boards of directors of joint ventures with partners in Asia, Europe and the Middle East. Prior to joining Teekay, he worked as a Chartered
Professional Accountant in the Vancouver, Canada office of Ernst & Young LLP.
60
Kate Ferguson was appointed as Vice President, Business Development, of the Company in July 2025. Ms Ferguson has been with the Company
since 2007, working in progressively more senior roles in commercial and business development across various segments of liquid bulk shipping,
including oil and product tankers, LPG, petrochemicals and LNG. Ms Ferguson worked internationally in London and Singapore before engaging in
business development and commercial strategy in Vancouver.
Chris McDade was appointed as Vice President, Operations, of the Company in 2020 and has over 24 years’ experience in the LNG shipping
industry as well as upstream operations with Exploration and Production. In 2016, he joined the Company as LNG Assurance Manager followed by
roles as Director, Marine HR and Fleet Director for Teekay Gas Services. Mr. McDade represents the Company on the boards of joint ventures with
partners in Europe, Asia and the Middle East. Before joining the Company, he worked for an oil major as a senior officer on LNG vessels before
moving into upstream operations working on major LNG/FPSO projects in West Africa and Australia.
Nathan Kim was appointed as General Counsel of the Company in 2022. He previously worked for Teekay Corporation starting in 2014, most
recently as Associate General Counsel since 2017, in which position he provided primary legal oversight for LNG business activities, including new
projects, financings, dispute resolution and operational matters. Prior to that, he practiced law in Vancouver, Canada.
Compensation of Executive Officers and Directors
During 2025, our five executive officers and two independent directors received, in the aggregate, $11.5 million of cash compensation for their
services, plus reimbursement of their out-of-pocket expenses, excluding any long-term incentive plan awards issued directly by our board of
directors, which plan is described below. We do not compensate our non-independent directors for their service as directors. Each independent
director is fully indemnified by us for actions associated with being a director to the extent permitted under Marshall Islands law.
Long-Term Incentive Plan
In 2022, we introduced a Long-Term Incentive Plan (or LTI Plan) for our eligible employees. Each target award under the LTI Plan is payable in
cash and vests in three equal installments over a three-year period. The vested amounts are scheduled to be paid out in April of each year.
Clawback Policy
On October 2, 2023, we adopted a clawback policy that applies to incentive-based compensation erroneously received by certain of our executives
(which currently comprises the individuals that we have determined would be an "officer" of the Company within the meaning of Rule 16a-1(f) of the
U.S. Securities Exchange Act of 1934). Under this policy, “erroneously-awarded compensation” is defined broadly to include any compensation that
is granted, earned, or vested based wholly or in part upon the attainment of a financial reporting measure (e.g. variable performance-related
compensation (cash bonus) and annual long-term incentive performance (LTI Plan)). The policy provides that in the event that the Company is
required to prepare an accounting restatement of its financial statements due to the Company’s material noncompliance with any financial reporting
requirements under the applicable securities laws, the Company will recover (on a pre-tax basis) from the relevant executives any erroneously-
awarded compensation received by such executives on or after October 2, 2023 and during the three fiscal years preceding the date the
restatement was required that exceeds the amount of erroneously-awarded compensation that otherwise would have been received had such
erroneously-awarded compensation been determined according to the applicable accounting restatement, subject to limited exceptions. The
recovery of such compensation applies regardless of whether any misconduct occurred and without regard to whether an executive engaged in
misconduct or otherwise caused or contributed to the requirement for a restatement.
Board Practices
Our Board currently consists of six members. Directors are appointed to serve until their successors are appointed or until they resign or are
removed.
There are no service contracts between us and any of our directors providing for benefits upon termination of their employment or service.
The Board has the following two committees: Audit Committee and Conflicts Committee. The membership of these committees and the function of
each of the committees are described below. Each of the committees is comprised of independent members and operates under a written charter
adopted by the Board. The committee charters for the Audit Committee and the Conflicts Committee are available under “Governance” from the
home page of our web site at www.seapeak.com. During 2025, the Board held four meetings and each director attended all Board meetings, with
the exception of one director who attended three board meetings and one director who attended two board meetings. The members of the Audit
Committee and the Conflicts Committee attended all meetings.
Audit Committee. The Audit Committee must be comprised of at least one director. Each member must meet the independence standards of the
NYSE and the SEC. This committee is comprised of Barry Curtis (Chair) and Lisa Krueger. The Board has determined that Mr. Curtis and Ms.
Krueger qualify as audit committee financial experts.
The Audit Committee assists the Board in fulfilling its responsibilities for general oversight of:
• the integrity of our consolidated financial statements;
• our compliance with legal and regulatory requirements;
• the independent auditors’ qualifications and independence; and
• the performance of our internal audit function and independent auditors.
61
Conflicts Committee. The Conflicts Committee must be comprised of at least one director and is comprised of Lisa Krueger (Chair) and Barry Curtis.
The Conflicts Committee members may not be (a) securityholders, officers or employees of Stonepeak, (b) officers, directors or employees of any
affiliate of Stonepeak (other than a member of our Board) or (c) holders of any ownership interest in us or our subsidiaries other than common or
preferred units, and members must meet the heightened NYSE and SEC director independence standards applicable to audit committee
membership.
The Conflicts Committee:
• reviews specific matters that the Board believes may involve conflicts of interest; and
• determines if the resolution of the conflict of interest is fair and reasonable to us.
Any matters approved by the Conflicts Committee will be conclusively deemed to be fair and reasonable to us, approved by all of our members, and
not a breach by our Board of any duties it may owe us or our members. The Board is not obligated to seek approval of the Conflicts Committee on
any matter and may determine the resolution of any conflict of interest itself and in accordance with our Limited Liability Company Agreement.
The Board's Role in Oversight of Environmental, Social and Corporate Governance
Our Corporate Governance Guidelines outline the Board’s role in oversight of our health, safety and environmental performance and our
performance on sustainability and diversity efforts. In addition, the Board is responsible for evaluating and overseeing compliance with our policies,
practices and contributions made in fulfillment of our social responsibilities and commitment to sustainability.
Crewing and Staff
As of December 31, 2025, approximately 2,300 seagoing staff served on our consolidated and equity-accounted for vessels that were managed by
subsidiaries of Seapeak and 317 staff served on-shore in technical, commercial and administrative roles in various countries, compared to
approximately 2,500 seagoing staff and 318 on-shore staff as of December 31, 2024. Certain subsidiaries of Seapeak employ the crews, who serve
on the vessels pursuant to agreements with the subsidiaries, and Seapeak subsidiaries also provide on-shore advisory, operational and
administrative support to our operating subsidiaries pursuant to service agreements. Please read “Item 7 – Major Common Unitholders and Related
Party Transactions.”
We regard attracting and retaining motivated seagoing personnel as a top priority. We offer our seafarers competitive employment packages and
comprehensive benefits and opportunities for personal and career development, which relates to a philosophy of promoting internally. Seapeak has
entered into Collective Bargaining Agreements with Filipino and Indonesian seafarers unions affiliated with the International Transport Workers’
Federation (or ITF), and a Special Agreement with ITF London, which covers all officers and ratings that operate vessels under ITF agreements. For
those vessels not covered by the ITF agreements, we have separate agreements in place with Spain’s Union General de Trabajadores and
Comisiones Obreras,  Singapore’s Maritime Officers' Union in Singapore and with Danish seafarers unions. The Filipino crew members employed
on our Danish and Singapore flagged vessels are also covered by a Collective Bargaining Agreement with a recognized Filipino seafarers union.
We believe our relationships with these labor unions are good. 
Our commitment to training is fundamental to the development of the highest calibre of seafarers for our marine operations. Seapeak has a cadet
program which takes in cadets from a number of countries including Croatia, India, Ireland Malaysia, Spain and the United Kingdom. On completion
of the relevant college phase training continues on-board our vessels. Seapeak also has a career development plan that we follow, which was
designed to ensure a continuous flow of qualified officers who are trained on its vessels and familiarized with its operational standards, systems and
policies. We believe that high-quality crewing and training policies will play an increasingly important role in driving continuous safety performance.
As such, we have an LNG training facility in Glasgow that serves this purpose.
Unit Ownership
As at the date of this Annual Report, our directors and officers do not own or have rights to acquire any of our common units. 
Item 7.    Major Common Unitholders and Related Party Transactions
Major Common Unitholders
As at the date of this Annual Report, our sole common unitholder is Stonepeak Limestone Holdings L.P., which is 100% owned by investment
vehicles managed by Stonepeak.
We are not aware of any arrangements the operation of which may at a subsequent date result in a change in control of the Company.
Related Party Transactions
a) Our Board currently includes four non-independent directors who also serve as officers, directors or employees of Stonepeak and its affiliates
or the Company. See “Item 6. Directors, Senior Management and Employees.” 
b) Please read “Item 18 – Financial Statements: Note 12 – Related Party Transactions” for additional information about these and various other
related-party transactions.
62
Item 8. Financial Information
A. Consolidated Financial Statements and Other Financial Information
Consolidated Financial Statements and Notes
Please read “Item 18 – Financial Statements” for additional information required to be disclosed under this Item.
Legal Proceedings
From time to time we have been, and expect to continue to be, subject to legal proceedings and claims in the ordinary course of our business.
These claims, even if lacking merit, could result in the expenditure of significant financial and managerial resources. We are not aware of any legal
proceedings or claims that we believe may have, individually or in the aggregate, a significant adverse effect on us, other than those set forth below
or in "Item 18 – Financial Statements: Note 14 – Commitments and Contingencies."
B. Significant Changes
Please read “Item 5 – Operating and Financial Review and Prospects: Management’s Discussion and Analysis of Financial Condition and Results of
Operations – Significant Developments in 2025 and Early 2026” and “Item 18 – Financial Statements: Note 19 – Subsequent Events” for
descriptions of significant changes that have occurred since December 31, 2025.
Item 9. The Offer and Listing
Our Series A and Series B Preferred Units are listed on the NYSE under the symbols "SEAL/PA" and "SEAL/PB," respectively.
Item 10. Additional Information
Memorandum and Articles of Association
Our Certificate of Formation has been filed as Exhibit 1.3 to our Report on Form 6-K (File No. 1-32479), filed with the SEC on February 25, 2022,
and our Limited Liability Company Agreement has been filed as Exhibit 1.4 to our Report on Form 6-K (File No. 1-32479), filed with the SEC on
February 25, 2022, and are each hereby incorporated by reference into this Annual Report.
The rights, preferences and restrictions attaching to each class of our units are described in the Exhibit 2.2 to this Annual Report on Form 20-F
entitled "Description of Securities Registered Under Section 12 of the Exchange Act", and hereby incorporated by reference into this Annual Report.
There are no limitations on the rights to own securities, including the rights of non-resident or foreign shareholders to hold or exercise voting rights
on the securities imposed by the laws of the Republic of The Marshall Islands or by our Limited Liability Company Agreement.
Material Contracts
Attached or incorporated by reference as exhibits to this Annual Report are contracts we consider to be material and not entered into in the ordinary
course. Descriptions of certain credit facilities are included in “Item 18 – Financial Statements: Note 10 – Long-Term Debt .”
Exchange Controls and Other Limitations Affecting Unitholders
We are not aware of any governmental laws, decrees or regulations, including foreign exchange controls, in the Republic of the Marshall Islands
that restrict the export or import of capital, or that affect the remittance of distributions, interest or other payments to holders of our securities that
are non-resident and not citizens and otherwise not conducting business or transactions in the Marshall Islands.
We are not aware of any limitations on the right of non-resident or foreign owners to hold or vote our securities imposed by the laws of the Republic
of the Marshall Islands or our Limited Liability Company Agreement.
Material United States Federal Income Tax Considerations
The following is a discussion of certain material U.S. federal income tax considerations that may be relevant to unitholders. This discussion is based
upon provisions of the Code, legislative history, applicable Treasury Regulations, judicial authority and administrative interpretations, all as in effect
on the date of this Annual Report, and which are subject to change, possibly with retroactive effect, or are subject to different interpretations.
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 “we,” “our” or “us” are references to Seapeak LLC.
This discussion is limited to unitholders who hold their units as capital assets for tax purposes. This discussion does not address all tax
considerations that may be important to a particular unitholder in light of the unitholder’s circumstances, or to certain categories of unitholders that
may be subject to special tax rules, such as:
• dealers in securities or currencies;
• traders in securities that have elected the mark-to-market method of accounting for their securities;
63
• persons whose functional currency is not the U.S. Dollar;
• persons holding our units as part of a hedge, straddle, conversion or other “synthetic security” or integrated transaction;
• certain U.S. expatriates;
• financial institutions;
• insurance companies;
• persons subject to the alternative minimum tax;
• persons that actually or under applicable constructive ownership rules own 10% or more of our units (by vote or value); and
• entities that are tax-exempt for U.S. federal income tax purposes.
If a partnership (including any entity or arrangement treated as a partnership for U.S. federal income tax purposes) holds our units, the tax
treatment of a partner generally will depend upon the status of the partner and the activities of the partnership. Partners in partnerships holding our
units should consult their tax advisors to determine the appropriate tax treatment of the partnership’s ownership of our units.
This discussion does not address any U.S. estate tax considerations or tax considerations arising under the laws of any state, local or non-U.S.
jurisdiction. Each unitholder is urged to consult its tax advisor regarding the U.S. federal, state, local, non-U.S. and other tax consequences of the
ownership or disposition of our units.
United States Federal Income Taxation of U.S. Holders
As used herein, the term U.S. Holder means a beneficial owner of our units that is for U.S. federal income tax purposes: (i) a U.S. citizen or U.S.
resident alien (or a U.S. Individual Holder), (ii) a corporation or other entity taxable as a corporation, that was created or organized under the laws of
the United States, any state thereof or the District of Columbia, (iii) an estate whose income is subject to U.S. federal income taxation regardless of
its source, or (iv) a trust that either is subject to the supervision of a court within the United States and has one or more U.S. persons with authority
to control all of its substantial decisions or has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person.
Distributions
We elected to be taxed as a corporation for U.S. federal income tax purposes effective January 1, 2019.
Subject to the discussion of PFICs below, any distributions made by us with respect to our units to a U.S. Holder generally will constitute dividends,
which may be taxable as ordinary income or “qualified dividend income” as described in more detail below, to the extent of our current and
accumulated earnings and profits allocated to the U.S. Holder’s units, as determined under U.S. federal income tax principles. Distributions in
excess of our current and accumulated earnings and profits allocated to the U.S. Holder's units will be treated first as a nontaxable return of capital
to the extent of the U.S. Holder’s tax basis in our units and thereafter as capital gain, which will be either long-term or short-term capital gain
depending upon whether the U.S. Holder has held the units for more than one year. U.S. Holders that are corporations for U.S. federal income tax
purposes generally will not be entitled to claim a dividends received deduction with respect to any distributions they receive from us. For purposes
of computing allowable foreign tax credits for U.S. federal income tax purposes, dividends received with respect to our units will be treated as
foreign source income and generally will be treated as “passive category income.”
Subject to holding period requirements and certain other limitations, dividends received with respect to our units by a U.S. Holder who is an
individual, trust or estate (or a Non-Corporate U.S. Holder) will be treated as “qualified dividend income” that is taxable to such Non-Corporate U.S.
Holder at preferential capital gain tax rates provided that we are not classified as a PFIC for the taxable year during which the dividend is paid or the
immediately preceding taxable year (we intend to take the position that we are not now and have never been classified as a PFIC, as discussed
below). Any dividends received with respect to our units not eligible for these preferential rates will be taxed as ordinary income to a Non-Corporate
U.S. Holder.
Special rules may apply to any “extraordinary dividend” paid by us. Generally, an extraordinary dividend is a dividend with respect to a preferred unit
if the amount of the dividend is equal to or in excess of 5% of a preferred unitholder’s, adjusted tax basis (or fair market value in certain
circumstances) in such preferred unit. In addition, extraordinary dividends include dividends received within a one-year period that, in the
aggregate, equal or exceed 20% of a unitholder's adjusted tax basis (or fair market value in certain circumstances). If we pay an “extraordinary
dividend” on our units that is treated as “qualified dividend income,” then any loss recognized by a Non-Corporate U.S. Holder from the sale or
exchange of such units will be treated as long-term capital loss to the extent of the amount of such dividend.
Certain Non-Corporate U.S. Holders are subject to a 3.8% tax on certain investment income, including dividends. Non-Corporate U.S. Holders
should consult their tax advisors regarding the effect, if any, of this tax on their ownership of our units.
Sale, Exchange or Other Disposition of Units
Subject to the discussion of PFICs below, a U.S. Holder generally will recognize capital gain or loss upon a sale, exchange or other disposition of
our units in an amount equal to the difference between the amount realized by the U.S. Holder from such sale, exchange or other disposition and
the U.S. Holder’s tax basis in such units. Subject to the discussion of extraordinary dividends above, such gain or loss generally will be treated as (i)
long-term capital gain or loss if the U.S. Holder’s holding period is greater than one year at the time of the sale, exchange or other disposition, or
short term capital gain or loss otherwise and (ii) U.S. source gain or loss, as applicable, for foreign tax credit purposes. Non-Corporate U.S. Holders
may be eligible for preferential rates of U.S. federal income tax in respect of long-term capital gains. A U.S. Holder’s ability to deduct capital losses
is subject to certain limitations.
64
Certain Non-Corporate U.S. Holders are subject to a 3.8% tax on certain investment income, including capital gains from the sale or other
disposition of units. Non-Corporate U.S. Holders should consult their tax advisors regarding the effect, if any, of this tax on their disposition of our
units.
Consequences of Possible PFIC Classification
A non-U.S. entity treated as a corporation for U.S. federal income tax purposes will be treated as a PFIC in any taxable year in which, after taking
into account the income and assets of the corporation and, pursuant to a “look through” rule, any other corporation or partnership in which the
corporation directly or indirectly owns at least 25% of the stock or equity interests (by value) and any partnership in which the corporation directly or
indirectly owns less than 25% of the equity interests (by value) to the extent the corporation satisfies an “active partner” test and does not elect out
of “look through” treatment, either: (i) at least 75% of its gross income is “passive” income, or (ii) at least 50% of the average value of its assets is
attributable to assets that produce or are held for the production of passive income. For purposes of these tests, “passive income” includes
dividends, interest, gains from the sale or exchange of investment property and rents and royalties (other than rents and royalties that are received
from unrelated parties in connection with the active conduct of a trade or business). By contrast, income derived from the performance of services
does not constitute “passive income.”
There are legal uncertainties involved in determining whether the income derived from our and our look-through subsidiaries' time-chartering
activities constitutes rental income or income derived from the performance of services, including legal uncertainties arising from the decision in
Tidewater Inc. v. United States, 565 F.3d 299 (5th Cir. 2009), which held that income derived from certain time-chartering activities should be
treated as rental income rather than services income for purposes of a foreign sales corporation provision of the Code. However, the IRS stated in
an Action on Decision (AOD 2010-01) that it disagrees with, and will not acquiesce to, the way that the rental versus services framework was
applied to the facts in the Tidewater decision, and in its discussion stated that the time charters at issue in Tidewater would be treated as producing
services income for PFIC purposes. The IRS’s statement with respect to Tidewater cannot be relied upon or otherwise cited as precedent by
taxpayers. Consequently, in the absence of any binding legal authority specifically relating to the statutory provisions governing PFICs, there can be
no assurance that the IRS or a court would not follow the Tidewater decision in interpreting the PFIC provisions of the Code. Moreover, the market
value of our units may be treated as reflecting the value of our assets at any given time. Therefore, a decline in the market value of our units, which
is not within our control, may impact the determination of whether we are a PFIC. Nevertheless, based on our and our look-through subsidiaries’
current assets and operations, we intend to take the position that we are not now and have never been a PFIC.
No assurance can be given, however, that the IRS, or a court of law, will accept our position or that we would not constitute a PFIC for the 2026
taxable year or for any future taxable year if there were to be changes in our or our look-through subsidiaries’ assets, income or operations.
As discussed more fully below, if we were to be treated as a PFIC for any taxable year, a U.S. Holder generally would be subject to different
taxation rules depending on whether the U.S. Holder makes a timely and effective election to treat us as a “qualified electing fund” (or a QEF
election). As an alternative to making a QEF election, a U.S. Holder should be able to make a “mark-to-market” election with respect to our units, as
discussed below.
Taxation of U.S. Holders Making a Timely QEF Election
A U.S. Holder who makes a timely QEF election (or an Electing Holder) must report the Electing Holder’s pro rata share of our ordinary earnings
and net capital gain, if any, for each taxable year for which we are a PFIC that ends with or within the Electing Holder’s taxable year, regardless of
whether or not the Electing Holder received distributions from us in that year. Such income inclusions would not be eligible for the preferential tax
rates applicable to qualified dividend income. The Electing Holder’s adjusted tax basis in our units will be increased to reflect taxed but undistributed
earnings and profits. Distributions of earnings and profits that were previously taxed will result in a corresponding reduction in the Electing Holder’s
adjusted tax basis in our units and will not be taxed again once distributed. An Electing Holder generally will recognize capital gain or loss on the
sale, exchange or other disposition of our units. A U.S. Holder makes a QEF election with respect to any year that we are a PFIC by filing IRS Form
8621 with the U.S. Holder’s timely filed U.S. federal income tax return (including extensions).
If a U.S. Holder has not made a timely QEF election with respect to the first year in the U.S. Holder’s holding period of our units during which we
qualified as a PFIC, the U.S. Holder may be treated as having made a timely QEF election by filing a QEF election with the U.S. Holder’s timely
filed U.S. federal income tax return (including extensions) and, under the rules of Section 1291 of the Code, a “deemed sale election” to include in
income as an “excess distribution” (described below) the amount of any gain that the U.S. Holder would otherwise recognize if the U.S. Holder sold
the U.S. Holder’s units on the “qualification date.” The qualification date is the first day of our taxable year in which we qualified as a “qualified
electing fund” with respect to such U.S. Holder. In addition to the above rules, under very limited circumstances, a U.S. Holder may make a
retroactive QEF election if the U.S. Holder failed to file the QEF election documents in a timely manner. If a U.S. Holder makes a timely QEF
election for one of our taxable years, but did not make such election with respect to the first year in the U.S. Holder’s holding period of our units
during which we qualified as a PFIC and the U.S. Holder did not make the deemed sale election described above, the U.S. Holder also will be
subject to the more adverse rules described below.
A U.S. Holder’s QEF election will not be effective unless we annually provide the U.S. Holder with certain information concerning our income and
gain, calculated in accordance with the Code, to be included with the U.S. Holder’s U.S. federal income tax return. We have not provided our U.S.
Holders with such information in prior taxable years and do not intend to provide such information in the current taxable year. Accordingly, U.S.
Holders will not be able to make an effective QEF election at this time. If, contrary to our expectations, we determine that we are or will be a PFIC
for any taxable year, we will provide U.S. Holders with the information necessary to make an effective QEF election with respect to our units.
65
Taxation of U.S. Holders Making a “Mark-to-Market” Election
If we were to be treated as a PFIC for any taxable year and our units were treated as “marketable stock,” then, as an alternative to making a QEF
election, a U.S. Holder would be allowed to make a “mark-to-market” election with respect to our units, provided the U.S. Holder completes and files
IRS Form 8621 in accordance with the relevant instructions and related Treasury Regulations. If that election is made for the first year a U.S. Holder
holds or is deemed to hold our units and for which we are a PFIC, the U.S. Holder generally would include as ordinary income in each taxable year
that we are a PFIC the excess, if any, of the fair market value of the U.S. Holder’s units at the end of the taxable year over the U.S. Holder’s
adjusted tax basis in the units. U.S. Holders are urged to consult their tax advisors regarding the PFIC rules, including the PFIC annual reporting
requirements, as well as the applicability, availability and advisability of, and procedure for, making QEF, Mark-to-Market and other available
elections with respect to us, and the U.S. federal income tax consequences of making such elections.
The U.S. Holder also would be permitted an ordinary loss in respect of the excess, if any, of the U.S. Holder’s adjusted tax basis in the units over
the fair market value thereof at the end of the taxable year that we are a PFIC, but only to the extent of the net amount previously included in
income as a result of the mark-to-market election. A U.S. Holder’s tax basis in our units would be adjusted to reflect any such income or loss
recognized. Gain recognized on the sale, exchange or other disposition of our units in taxable years that we are a PFIC would be treated as
ordinary income, and any loss recognized on the sale, exchange or other disposition of our units in taxable years that we are a PFIC would be
treated as ordinary loss to the extent that such loss does not exceed the net mark-to-market gains previously included in income by the U.S. Holder.
Because the mark-to-market election only applies to marketable stock, however, it would not apply to a U.S. Holder’s indirect interest in any of our
subsidiaries that were also determined to be PFICs.
If a U.S. Holder makes a mark-to-market election for one of our taxable years and we were a PFIC for a prior taxable year during which such U.S.
Holder held our units and for which (i) we were not a QEF with respect to such U.S. Holder and (ii) such U.S. Holder did not make a timely mark-to-
market election, such U.S. Holder would also be subject to the more adverse rules described below in the first taxable year for which the mark-to-
market election is in effect and also to the extent the fair market value of the U.S. Holder’s units exceeds the U.S. Holder’s adjusted tax basis in the
units at the end of the first taxable year for which the mark-to-market election is in effect.
Taxation of U.S. Holders Not Making a Timely QEF or Mark-to-Market Election
If we were to be treated as a PFIC for any taxable year, a U.S. Holder who does not make either a QEF election or a “mark-to-market” election for
that year (a Non-Electing Holder ) would be subject to special rules resulting in increased tax liability with respect to (i) any “excess
distribution” (e.g. the portion of any distributions received by the Non- Electing Holder on our units in a taxable year in excess of 125% of the
average annual distributions received by the Non-Electing Holder in the three preceding taxable years, or, if shorter, the Non-Electing Holder’s
holding period for our units), and (ii) any gain realized on the sale, exchange or other disposition of our units. Under these special rules:
• the excess distribution or gain would be allocated ratably over the Non-Electing Holder’s aggregate holding period for our units;
• the amount allocated to the current taxable year and any taxable year prior to the taxable year we were first treated as a PFIC with respect to
the Non-Electing Holder would be taxed as ordinary income in the current taxable year;
• the amount allocated to each of the other taxable years would be subject to U.S. federal income tax at the highest rate of tax in effect for the
applicable class of taxpayer for that year; and
• an interest charge for the deemed deferral benefit would be imposed with respect to the resulting tax attributable to each such other taxable
year.
Additionally, for each year during which a U.S. Holder holds our units, we are a PFIC, and the total value of all PFIC units that such U.S. Holder
directly or indirectly holds exceeds certain thresholds, such U.S. Holder will be required to file IRS Form 8621 with its annual U.S. federal income
tax return to report its ownership of our units. In addition, if a Non-Electing Holder, who is an individual, dies while owning our units, such Non-
Electing Holder’s successor generally would not receive a step-up in tax basis with respect to such units.
U.S. Holders are urged to consult their tax advisors regarding the PFIC rules, including the PFIC annual reporting requirements, as well
as the applicability, availability and advisability of, and procedure for, making QEF, Mark-to-Market and other available elections with
respect to us, and the U.S. federal income tax consequences of making such elections.
U.S. Return Disclosure Requirements for U.S. Individual Holders
U.S. Individual Holders who hold certain specified foreign financial assets, including stock in a foreign corporation that is not held in an account
maintained by a financial institution, with an aggregate value in excess of $50,000 on the last day of a taxable year, or $75,000 at any time during
that taxable year, may be required to report such assets on IRS Form 8938 with their U.S. federal income tax return for that taxable year. This
reporting requirement does not apply to U.S. Individual Holders who report their ownership of our units under the PFIC annual reporting rules
described above. Penalties apply for failure to properly complete and file IRS Form 8938. U.S. Individual Holders are encouraged to consult with
their tax advisors regarding the possible application of this disclosure requirement to their investment in our units.
United States Federal Income Taxation of Non-U.S. Holders
A beneficial owner of our units (other than a partnership, including any entity or arrangement treated as a partnership for U.S. federal income tax
purposes) that is not a U.S. Holder is a Non-U.S. Holder.
66
Distributions
In general, a Non-U.S. Holder will not be subject to U.S. federal income tax on distributions received from us with respect to our units unless the
distributions are effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States (and, if required by an
applicable income tax treaty, are attributable to a permanent establishment that the Non-U.S. Holder maintains in the United States). If a Non-U.S.
Holder is engaged in a trade or business within the United States and the distributions are deemed to be effectively connected to that trade or
business (and, if required by an applicable income tax treaty, are attributable to a permanent establishment that the Non-U.S. Holder maintains in
the United States), the Non-U.S. Holder generally will be subject to U.S. federal income tax on those distributions in the same manner as if it were a
U.S. Holder. In addition, a Non-U.S. Holder that is a foreign corporation for U.S. federal income tax purposes may be subject to branch profits tax at
a rate of 30% (or lower applicable treaty rate) on the after-tax earnings and profits attributable to such distributions.
Sale, Exchange or Other Disposition of Units
In general, a non-U.S. Holder is not subject to U.S. federal income tax on any gain resulting from the disposition of our units unless (i) such gain is
effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States (and, if required by an applicable income
tax treaty, is attributable to a permanent establishment that the Non-U.S. Holder maintains in the United States) or (ii) the Non-U.S. Holder is an
individual who is present in the United States for 183 days or more during the taxable year in which such disposition occurs and meets certain other
requirements. If a Non-U.S. Holder is engaged in a trade or business within the United States and the disposition of our units is deemed to be
effectively connected to that trade or business (and, if required by an applicable income tax treaty, are attributable to a permanent establishment
that the Non-U.S. Holder maintains in the United States), the Non-U.S. Holder generally will be subject to U.S. federal income tax on the resulting
gain in the same manner as if it were a U.S. Holder. In addition, a Non-U.S. Holder that is a foreign corporation for U.S. federal income tax
purposes may be subject to branch profits tax at a rate of 30% (or lower applicable treaty rate) on the after-tax earnings and profits attributable to
such gain.
Information Reporting and Backup Withholding
In general, distributions taxable as dividends with respect to, or the proceeds from a sale, redemption or other taxable disposition of, our units held
by a Non-Corporate U.S. Holder will be subject to information reporting requirements, unless such distribution taxable as a dividend is paid and
received outside the United States by a non-U.S. payor or non-U.S. middleman (within the meaning of the Treasury Regulations), or such proceeds
are effected through an office outside the U.S. of a broker that is considered a non-U.S. payor or non-U.S. middleman (within the meaning of the
Treasury Regulations). These amounts also generally will be subject to backup withholding if the Non-Corporate U.S. Holder:
• fails to timely provide an accurate taxpayer identification number;
• is notified by the IRS that it has failed to report all interest or distributions required to be shown on its U.S. federal income tax returns; or
• in certain circumstances, fails to comply with applicable certification requirements.
Information reporting and backup withholding generally will not apply to distributions taxable as dividends on our units to a Non-U.S. Holder if such
dividend is paid and received outside the United States by a non-U.S. payor or non-U.S. middleman (within the meaning of the Treasury
Regulations) or the Non-U.S. Holder properly certifies under penalties of perjury as to its non-U.S. status (generally on IRS Form W-8BEN,
W-8BEN-E, W-8ECI, or W-8EXP, as applicable) and certain other conditions are met or the Non-U.S. Holder otherwise establishes an exemption.
Payment of proceeds to a Non-U.S. Holder from a sale, redemption or other taxable disposition of our units to or through the U.S. office of a broker,
or through a broker that is considered a U.S. payor or U.S. middleman (within the meaning of the Treasury Regulations), generally will be subject to
information reporting and backup withholding, unless the Non-U.S. Holder properly certifies under penalties of perjury as to its non-U.S. status
(generally on IRS Form W-8BEN, W-8BEN-E, W-8ECI, or W-8EXP, as applicable) and certain other conditions are met or the Non-U.S. Holder
otherwise establishes an exemption.
Backup withholding is not an additional tax. Rather, a Non-Corporate U.S. Holder or Non-U.S. Holder generally may obtain a credit for any amount
withheld against its liability for U.S. federal income tax (and obtain a refund of any amounts withheld in excess of such liability) by accurately
completing and timely filing a U.S. federal income tax return with the IRS.
Non-United States Tax Considerations
Marshall Islands Taxation
Because we and our subsidiaries do not, and do not expect that we or they will, conduct business, transactions or operations in the Republic of the
Marshall Islands, and because all documentation related to issuance of our common and preferred units was and is expected to be executed
outside of the Republic of the Marshall Islands, under current Marshall Islands law, holders of our common and preferred units that are not citizens
of and do not reside in, maintain offices in, or engage in business, operations, or transactions in the Republic of the Marshall Islands will not be
subject to Marshall Islands taxation or withholding on distributions that we make to our unitholders. In addition, such unitholders will not be subject
to Marshall Islands stamp, capital gains or other taxes on the purchase, ownership or disposition of our common and preferred units, and they will
not be required by the Republic of the Marshall Islands to file a tax return relating to the common or preferred units.
67
Other Taxation
We and our subsidiaries are subject to taxation in certain non-U.S. jurisdictions because we or our subsidiaries are either organized, or conduct
business or operations, in such jurisdictions. In other non-U.S. jurisdictions, we and our subsidiaries rely on statutory exemptions from tax.
However, we cannot assure that any statutory exemptions from tax on which we or our subsidiaries rely will continue, as tax laws in those
jurisdictions may change or we may enter into new business transactions relating to such jurisdictions, which could affect our or our subsidiaries' tax
liability. Please read “Item 18 – Financial Statements: Note 11 – Income Tax (Expense) Recovery ”.
Documents on Display
Documents concerning us that are referred to herein may be inspected at our principal executive offices at 2000, 550 Burrard Street, Vancouver,
B.C., Canada, V6C 2K2. Those documents electronically filed via the SEC’s Electronic Data Gathering, Analysis, and Retrieval system may also be
obtained from the SEC’s website at www.sec.gov, free of charge.
Item 11. Quantitative and Qualitative Disclosures About Market Risk
Interest Rate Risk
We are exposed to the impact of interest rate changes primarily through our borrowings that require us to make interest payments based on NIBOR
or SOFR. Significant increases in interest rates could adversely affect our results of operations and our ability to service our debt. From time to time,
we use interest rate swaps to reduce our exposure to market risk from changes in interest rates. The principal objective of these contracts is to
minimize the risks and costs associated with our floating-rate debt.
We are exposed to credit loss in the event of non-performance by the counterparties to the interest rate swap agreements. In order to minimize
counterparty risk, we only enter into derivative transactions with counterparties that are rated A- or better by Standard & Poor’s or A3 or better by
Moody’s at the time of the transactions. In addition, to the extent practical, interest rate swaps are entered into with different counterparties to
reduce concentration risk.
The table below provides information about our financial instruments at December 31, 2025, that are sensitive to changes in interest rates, including
our long-term debt, obligations related to finance leases and interest rate swaps, but excluding any amounts related to our equity-accounted joint
ventures. None of these financial instruments were entered into for trading purposes. For long-term debt and obligations related to finance leases,
the table presents principal payments and related weighted-average interest rates by expected maturity dates. For interest rate swaps, the table
presents notional amounts and weighted-average interest rates by expected contractual maturity dates. The expected contractual maturity dates do
not reflect potential prepayments of long-term debt and obligations related to finance leases as well as the potential exercise of early termination
options for certain of our interest rate swaps.
Expected Maturity Date
2026
2027
2028
2029
2030
There-
after
Total
Fair
Value
Liability
(Asset)
Rate(1)
 
(in millions of U.S. Dollars, except percentages)
Long-Term Debt:
Fixed Rate ($U.S.)
18.0
18.0
18.0
18.0
15.8
—
87.8
85.4
4.3%
Variable-Rate ($U.S.)(2)
180.0
359.7
36.7
27.5
108.2
—
712.1
713.8
6.1%
Variable-Rate (NOK)(3)(4)
99.1
—
—
—
—
—
99.1
100.4
9.1%
Obligations Related to Finance
Leases:
Variable-Rate ($U.S.)(5)
89.3
176.7
88.3
118.6
170.2
352.6
995.7
996.2
6.4%
Fixed-Rate ($U.S.) (5)
139.7
133.0
210.1
34.6
78.2
211.2
806.8
804.3
4.9%
Average Interest Rate(6)
5.8%
5.6%
5.5%
6.2%
5.5%
5.9%
5.7%
Interest Rate Swaps:
Contract Amount ($U.S.)(7)
221.1
392.2
128.9
145.3
9.9
35.9
933.3
(54.1)
2.3%
Average Fixed-Pay Rate(2)
1.4%
2.3%
2.0%
3.4%
3.4%
3.3%
2.3%
(1) Rate refers to the weighted-average effective interest rate for our long-term debt and obligations related to finance leases, including the margin we pay
on our floating-rate debt and the average fixed pay rate for our interest rate swap agreements. The average interest rate for our obligations related to
finance leases is the weighted-average interest rate implicit in our lease obligations at the inception of the leases. The average fixed pay rate for our
interest rate swaps excludes the margins and the credit adjustment spreads we pay on our drawn floating-rate debt, which as of December 31, 2025
ranged from 2.00% to 3.45%. Please read “Item 18 – Financial Statements: Note 10 – Long-Term Debt.”
(2) Interest payments on U.S. Dollar-denominated debt and interest rate swaps are based on SOFR.
(3) NOK-denominated amounts have been converted to U.S. Dollars using the prevailing exchange rate as of December 31, 2025.
68
(4) Interest payments on our NOK-denominated debt and on our cross currency swaps are based on NIBOR. Our NOK-denominated bond has been
economically hedged with cross currency swaps, to swap all interest and principal payments into U.S. Dollars, with the interest payments fixed at
6.37%, and the transfer of principal locked in at $117 million upon maturity. Please see "Foreign Currency Fluctuations" below and read “Item 18 –
Financial Statements: Note 13 – Derivative Instruments and Hedging Activities.”
(5) The amount of obligations related to finance leases represents the present value of minimum lease payments together with our purchase obligation, as
applicable.
(6) The average interest rate is the weighted-average interest rate implicit in the obligations related to our fixed-rate finance leases at the inception of the
leases.
(7) The average variable receive rate for our U.S. Dollar-denominated interest rate swaps is set at overnight SOFR except for nine interest rate swaps,
which are set at applicable 3-month term SOFR. Contract amount for U.S. Dollar-denominated interest rate swaps includes forward-starting swaps with
inception dates ranging from February 2026 to June 2026.
Spot Market Rate Risk
Certain of our NGL carriers in our 50%-owned Exmar LPG Joint Ventures are trading in the spot market. In addition, we currently have three LNG
carriers in our 52%-owned MALT Joint Venture that have recently completed their long-term charter contracts and have been operating on short-
term charter contracts since their redeliveries to us. Additionally, we have five LNG carriers (including two 52%-owned LNG carriers and one 70%-
owned LNG carrier) which are expected to complete their long-term charter contracts in 2026. These LNG carriers may be traded in the spot market
if we are unable to obtain a suitable long-term charter contract. Please read “Item 5 – Operating and Financial Review and Prospects:
Management’s Discussion and Analysis of Financial Condition and Results of Operations – Significant Developments in 2025 and Early 2026 –
Other Fleet Developments". The cyclical nature of the LNG and NGL spot market may cause significant increases or decreases in the revenues we
earn from these vessels trading in the spot market.
Foreign Currency Fluctuations
Our functional currency is U.S. Dollars because nearly all of our revenues and most of our operating costs are in U.S. Dollars. Our results of
operations are affected by fluctuations in currency exchange rates. The volatility in our financial results due to currency exchange rate fluctuations is
attributed primarily to foreign currency expenses and our NOK-denominated bonds. In addition, we have a portion of our capital expenditures
denominated in Euros. We incur NOK-denominated interest expense on our NOK-denominated bonds; however, we entered into cross currency
swaps and pursuant to these swaps we receive the principal amount in NOK on the maturity date of the swaps, in exchange for payment of a fixed
U.S. Dollar amount. In addition, the cross currency swaps exchange a receipt of floating interest in NOK based on NIBOR plus a margin for a
payment of U.S. Dollar fixed interest. The purpose of the cross currency swaps is to economically hedge the foreign currency exposure on the
payment of interest and principal of our NOK bonds in 2026, and to economically hedge the interest rate exposure. We do not use financial
instruments for trading purposes. We have not designated, for accounting purposes, these cross currency swaps as cash flow hedges of the NOK-
denominated bonds due in 2026. Please read “Item 18 – Financial Statements: Note 13 – Derivative Instruments and Hedging Activities.” At
December 31, 2025, the fair value of the cross currency swaps derivative liabilities was $15.9 million and the change from December 2024 to the
reporting period has been reported in foreign currency exchange loss in the consolidated statements of income (loss). As a result, fluctuations in the
Euro and NOK relative to the U.S. Dollar have caused, and are likely to continue to cause, fluctuations in our reported vessel operating expenses,
interest expense, realized and unrealized (loss) gain on non-designated derivative instruments and foreign currency exchange loss in the
consolidated statements of income (loss).
Item 12. Description of Securities Other than Equity Securities
Not applicable.
69
PART II
Item 13. Defaults, Dividend Arrearages and Delinquencies
None.
Item 14. Material Modifications to the Rights of Unitholders and Use of Proceeds
Not applicable.
Item 15. Controls and Procedures
Disclosure Controls and Procedures
We maintain disclosure controls and procedures (as defined in Rules 13(a)-15(e) and 15(d)-15(e) under the U.S. Securities and Exchange Act of
1934, as amended (or the Exchange Act)) that are designed to ensure that (i) information required to be disclosed in our reports that are filed or
submitted under the Exchange Act, are recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and
forms, and (ii) information required to be disclosed by us in the reports we file or submit under the Exchange Act is accumulated and communicated
to our management, including the principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow
timely decisions regarding required disclosure.
We conducted an evaluation of our disclosure controls and procedures under the supervision and with the participation of our Chief Executive
Officer and our Chief Financial Officer. Based on the evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our
disclosure controls and procedures were effective as of December 31, 2025.
The Chief Executive Officer and Chief Financial Officer do not expect that our disclosure controls or internal controls will prevent all errors and all
fraud. Although our disclosure controls and procedures were designed to provide reasonable assurance of achieving their objectives, a control
system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the system are
met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered
relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all
control issues and instances of fraud, if any, within us have been detected. These inherent limitations include the realities that judgments in
decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the
individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls
also is based partly on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in
achieving its stated goals under all potential future conditions.
Management’s Annual Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining for us adequate internal control over financial reporting.
Our internal controls are designed to provide reasonable assurance as to the reliability of our financial reporting and the preparation and
presentation of the consolidated financial statements for external purposes in accordance with accounting principles generally accepted in the
United States. Our internal control over financial reporting includes those policies and procedures that: 1) pertain to the maintenance of records
that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; 2) provide reasonable assurance that
transactions are recorded as necessary to permit preparation of the financial statements in accordance with U.S. generally accepted accounting
principles, and that our receipts and expenditures are being made in accordance with authorizations of management and the directors; and 3)
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have
a material effect on our consolidated financial statements.
We conducted an evaluation of the effectiveness of our internal control over financial reporting based upon the framework in Internal Control –
Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. This evaluation included review
of the documentation of controls, evaluation of the design effectiveness of controls, testing of the operating effectiveness of controls and a
conclusion on this evaluation.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements even when determined to be
effective and can only provide reasonable assurance with respect to financial statement preparation and presentation. Also, projections of any
evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that
the degree of compliance with the policies and procedures may deteriorate. However, based on the evaluation, management has determined that
the internal control over financial reporting was effective as of December 31, 2025.
Changes in Internal Control over Financial Reporting
There have been no changes in our internal control over financial reporting (as defined in Rule 13(a)-15(f) under the Exchange Act) during the year
ended December 31, 2025 that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.
70
Item 16A.   Audit Committee Financial Expert
The Board (which is controlled by Stonepeak and its affiliates) has determined that Director and Chair of the Audit Committee, Barry Curtis, and
Audit Committee member Lisa Krueger each qualifies as an audit committee financial expert and is independent under applicable NYSE and SEC
standards.
Item 16B.   Code of Ethics
We have adopted a Standards of Business Conduct Policy (or Code of Conduct) that applies to all our employees and directors. This document is
available under “Governance” located in the 'Who we are' section of our website (www.seapeak.com). Additionally, any person may receive a hard
copy or an electronic file of the Code of Conduct at no cost by directing a request to the attention of Internal Audit at Seapeak LLC, 2000, 550
Burrard Street, Vancouver, B.C., Canada, V6C 2K2. We intend to disclose, under “Governance” located in the 'Who we are' section of our website,
any waivers to or amendments of our Standards of Business Conduct Policy that benefit any directors and executive officers of Seapeak.
Item 16C.   Principal Accountant Fees and Services
Our principal accountant for 2025 and 2024 was KPMG LLP, independent registered public accounting firm. The following table shows the fees we
paid or accrued for audit services provided by KPMG LLP for 2025 and 2024 .
Fees (in thousands of U.S. Dollars)
2025
2024
Audit Fees(1)
1,816
1,574
Audit-Related Fees(2)
57
54
Tax Fees(3)
1
—
Total
1,874
1,628
(1) Audit fees represent fees for professional services provided in connection with the audits of our consolidated financial statements, review of our
quarterly consolidated financial statements, audit services provided in connection with other statutory audits, and professional services in connection
with the review of our regulatory filings for our equity offerings.
(2) Audit-related fees consisted of employee benefit plan audits and attestation services for regulatory requirements.
(3) Tax services in 2025 relate to corporate tax return preparation and supporting schedules for tax year 2024, including determination of quarterly
estimated payments, and related consulting on routine tax matters. No tax services were provided to us by the auditor during 2024.
The Audit Committee of our Board has the authority to pre-approve permissible audit, audit-related and non-audit services not prohibited by law to
be performed by our independent auditors and associated fees. Engagements for proposed services either may be separately pre-approved by the
Audit Committee or entered into pursuant to detailed pre-approval policies and procedures established by the Audit Committee, as long as the Audit
Committee is informed on a timely basis of any engagement entered into on that basis. The Audit Committee pre-approved all engagements and
fees paid to our principal accountant in 2025 and in 2024.
Item 16D.   Exemptions from the Listing Standards for Audit Committees
Not applicable.
Item 16E.   Purchases of Units by the Issuer and Affiliated Purchasers
In March 2022, we implemented a repurchase plan authorizing the repurchase of our Series A and Series B Preferred Units up to a maximum of
$30.0 million in aggregate for the Series A and Series B Preferred Units combined. As at December 31, 2025, the Company had repurchased
67,452 Series A Preferred Units and 203,885 Series B Preferred Units for $1.7 million and $5.0 million , at an average price per unit of $24.27 and
$24.67, respectively, and the remaining dollar value of Series A and Series B Preferred Units that may be repurchased under the plan was $23.3
million. We repurchased no preferred units during 2025.
Item 16F.   Change in Registrant’s Certifying Accountant
Not applicable.
Item 16G.   Corporate Governance
As a foreign private issuer, we are not required to comply with certain corporate governance practices required of U.S. companies under the NYSE
listing standards.
The following is the significant ways in which our corporate governance practices differ from those followed by U.S. domestic companies listed on
the NYSE that are also “controlled companies” (as defined in the NYSE Listed Company Manual), and which differences are permitted by NYSE
rules for foreign private issuers such as us organized under the laws of the Marshall Islands:
71
• We are not required to obtain unitholder approval prior to the adoption of equity compensation plans or certain equity issuances, including,
among others, issuing 20% or more of our outstanding common units or voting power in a transaction.
• We are not required to have an Audit Committee comprised of at least three independent directors. Our Audit Committee currently is
comprised of two members.
Item 16H.   Mine Safety Disclosure
Not applicable.
Item 16I. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Not applicable.
Item 16J. Insider Trading Policies
We have implemented an insider trading policy (or Insider Trading Policy) that is reasonably designed to promote compliance with applicable insider
trading laws, rules and regulations, including the applicable listing standards of the NYSE. The Insider Trading Policy has been filed as Exhibit 11.1
to this Annual Report on Form 20-F.
Item 16K.   Cybersecurity
Risk Management and Strategy
The Company prioritizes the safeguarding and security of our computer systems, software and networks, both as it relates to our onshore offices
and our vessels operating abroad. We have implemented processes designed to identify, assess, mitigate and respond to cybersecurity risks,
including, but not limited to, risks related to ransomware, hacking, phishing, malware, data breaches, USB infection and social engineering. As part
of our global cyber risk management strategy, we have implemented what we believe to be comprehensive cybersecurity risk management policies.
Our cybersecurity policies are guided by and integrate recognized industry standards and frameworks, including, but not limited to, the National
Institute of Standards and Technology Cybersecurity Framework.
Our cybersecurity risk management policies incorporate a number of components, including, but not limited to, information security policies and
operating procedures, periodic information security risk assessments and other vulnerability analyses, and ongoing monitoring of critical risks from
cybersecurity threats using automated tools. Additionally, we have implemented a process to conduct cybersecurity awareness training for
employees during onboarding and thereafter, and we conduct regular phishing tests in an effort to raise awareness of spoofed or manipulated
electronic communications and other cybersecurity threats.
We maintain a Cybersecurity Master Plan and a Cyber Incident Response Plan (or CIRP) which is designed to guide our response to various levels
of cyber threats and incidents, including to mitigate and contain any potential cybersecurity incidents that could affect our vessels, systems,
network, or data. The CIRP identifies the individuals responsible for developing, maintaining, and following procedures related to cybersecurity
incident response, including escalation protocols. We also engage external third-party consultants to provide services, such as annual penetration
testing, and periodic vulnerability assessments.
We also conduct annual cyber drills to test and enhance our response capabilities, distribute cybersecurity advice on our internal social media
platform, and participate in industry conferences in an effort to stay ahead of emerging threats. Additionally, we maintain strategic partnerships with
various cybersecurity companies that provide our managed network services and Security Operations Center, which we believe increases our
access to advanced tools and expertise that enhance our cybersecurity.
Cybersecurity Incidents
Our business strategy, results of operations and financial condition have not been materially affected by risks from cybersecurity threats, including
as a result of previous cybersecurity incidents, but we cannot provide assurance that they will not be materially affected in the future by such risks
and any future material incidents. In the last three fiscal years, we have not experienced any material information security breach incidences and
the expenses we have incurred from information security breach incidences were immaterial.
Governance
Our Chief Information Officer (or CIO) has primary responsibility for the day-to-day management of our cybersecurity risk management program,
including leading a dedicated internal team of technology professionals (or Incident Management Team) to monitor cybersecurity risks on behalf of
our Company. In addition, our CIO, together with the Incident Management Team, is responsible for overseeing and assessing potential
vulnerabilities and exposures to cybersecurity threats, implementing controls and measures designed to mitigate these risks, and regularly
monitoring and updating these measures as appropriate to adapt to evolving cybersecurity threats. Our current CIO possesses over 25 years of
experience within the information technology and cybersecurity risk management industry.
Our board of directors has ultimate responsibility for oversight of the Company’s cybersecurity risk management. Our board of directors has
delegated to the Audit Committee oversight of our cybersecurity risk management program, which includes reviewing our cybersecurity and other
information technology risks, controls and procedures, including our plans to mitigate cybersecurity risks and to respond to data breaches. Our
Internal Audit function, alongside the CIO, provides periodic reports to the Audit Committee covering cybersecurity and other information technology
risks affecting us. In the event of a cybersecurity incident, we have implemented a process in which our internal audit function or the CIO would
report such incident to our Audit Committee.
72
PART III
Item 17. Financial Statements
Not applicable.
Item 18. Financial Statements
The following financial statements, together with the related report of KPMG LLP, Independent Registered Public Accounting Firm are filed as part
of this Annual Report:
 
Page
F - 1
Consolidated Financial Statements
F - 2
F - 3
F - 4
F - 5
F - 6
F - 7
All schedules for which provision is made in the applicable accounting regulations of the SEC are not required, are inapplicable or have been
disclosed in the Notes to the Consolidated Financial Statements and therefore have been omitted.
73
Item 19. Exhibits
The following exhibits are filed as part of this Annual Report:
Certificate of Conversion (1)
Plan of Conversion dated as of February 25, 2022 (1)
Certificate of Formation of Seapeak LLC (1)
Limited Liability Company Agreement of Seapeak LLC. (1)
Description of Securities Registered Under Section 12 of the Exchange Act.(2)
Agreement dated November 15, 2016, for a U.S. $730,000,000 Secured Loan Facility between Bahrain LNG W.L.L. and
Standard Chartered Bank and other banks. (3)
Agreement dated December 21, 2016, for a U.S. $723,200,000 Secured Loan Facility between Teekay Nakilat (III)
Corporation and Qatar National Bank SAQ. (3)
Agreement dated December 8, 2017, for a U.S. $1,632,000,000 Secured Loan Agreement between DSME Hull No. 2423
L.L.C., DSME Hull No. 2425 L.L.C., DSME Hull No. 2430 L.L.C., DSME Hull No. 2431 L.L.C., DSME Hull No. 2433 L.L.C. and
DSME Hull No. 2434 L.L.C. (as borrowers) and China Development Bank. (4)
Agreement and Plan of Merger, dated October 4, 2021, by and among Stonepeak Infrastructure Fund IV Cayman (AIV III) LP,
Limestone Merger Sub, Inc., Teekay LNG Partners, L.P. and Teekay GP L.L.C. (5)
List of Subsidiaries of Seapeak LLC.
Insider Trading Policy (6)
Rule 13a-15(e)/15d-15(e) Certification of Mark Kremin, President and Chief Executive Officer.
Rule 13a-15(e)/15d-15(e) Certification of Scott Gayton, Chief Financial Officer.
Certification of Mark Kremin, President and Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002.
Certification of Scott Gayton, Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906
of the Sarbanes-Oxley Act of 2002.
Consolidated Financial Statements of TC LNG Shipping L.L.C.
Clawback Policy (7)
101.INS
Inline XBRL Instance Document.
101.SCJ
Inline XBRL Taxonomy Extension Schema.
101.CAL
Inline XBRL Taxonomy Extension Calculation Linkbase.
101.DEF
Inline XBRL Taxonomy Extension Definition Linkbase.
101.LAB
Inline XBRL Taxonomy Extension Label Linkbase.
101.PRE
Inline XBRL Taxonomy Extension Presentation Linkbase.
104
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101.INS)
___________________________
(1) Previously filed as exhibits 1.1, 1.2, 1.3 and 1.4 to the Company's Report on Form 6-K (File No. 1-32479), filed with the SEC on February 25, 2022, and
hereby incorporated by reference to such Annual Report.
(2) Previously filed as exhibit 2.2 to the Company's Annual Report on Form 20-F (File No. 1-32479), filed with the SEC on March 22, 2024 and hereby
incorporated by reference to such report.
(3) Previously filed as exhibits 4.37 and 4.39 to the Company's Annual Report on Form 20-F (File No. 1-32479), filed with the SEC on April 26, 2017 and
hereby incorporated by reference to such report.
(4) Previously filed as exhibit 4.20 to the Company's Annual Report on Form 20-F (File No. 1-32479), filed with the SEC on April 5, 2019 and hereby
incorporated by reference to such report.
(5) Previously filed as an exhibit 4.1 to the Company's Report on Form 6-K (File No. 1-32479), filed with the SEC on October 12, 2021 and hereby
incorporated by reference to such report.
(6) Previously filed as exhibit 11.1 to the Company's Annual Report on Form 20-F (File No. 1-32479), filed with the SEC on March 22, 2024 and hereby
incorporated by reference to such report.
(7) Previously filed as exhibit 97 to the Company's Annual Report on Form 20-F (File No. 1-32479), filed with the SEC on March 22, 2024 and hereby
incorporated by reference to such report.
74
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
 
 
SEAPEAK LLC
 
 
 
Date: March 17, 2026
 
 
By:
 
/s/ Scott Gayton
 
 
 
Scott Gayton
 
 
 
Chief Financial Officer
 
 
 
(Principal Financial and Accounting Officer)
F-1
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Unitholders
Seapeak LLC:
Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated balance sheets of Seapeak LLC and subsidiaries (the Company) as of December 31, 2025 and
2024, the related consolidated statements of income (loss), comprehensive income (loss), cash flows, and changes in total equity for each of the
years in the three-year period ended December 31, 2025, and the related notes (collectively, the consolidated financial statements). In our opinion, the
consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and
the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2025, in conformity with U.S.
generally accepted accounting principles.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these
consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight
Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws
and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The
Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are
required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of
the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error
or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the
amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits
provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was
communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the
consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit
matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical
audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Indicators of impairment for vessels and equipment
As discussed in Note 1 to the consolidated financial statements, vessels and equipment that are intended to be held and used in the Company's
business (including those held within equity-accounted for joint ventures) are assessed for impairment when events or circumstances indicate the total
net carrying value of the asset group, consisting of the vessel and its customer contract, may not be recoverable. The Company’s evaluation of events
or circumstances that may indicate impairment include, amongst others, the estimated future charter rates and the Company’s intended use of the
vessels. As of December 31, 2025, the Company has $328,616 thousand of vessels and equipment and $2,156,322 thousand of vessels related to
finance leases. As discussed in Note 7, the Company’s equity-accounted joint ventures hold $2,680,213 thousand of vessels and equipment (at 100%
ownership interest), which includes the vessels and equipment and vessels related to finance leases held within equity-accounted joint ventures.
We identified the assessment of indicators of impairment for vessels and equipment as a critical audit matter. Challenging auditor judgment was
required to assess the Company’s evaluation of estimated future charter rates and assumptions regarding the intended use of the vessels and
equipment as these assumptions are market-dependent and subject to significant changes. Changes in these significant assumptions could have
changed the Company’s conclusion regarding indicators of impairment.
The following are the primary procedures we performed to address this critical audit matter. We evaluated the design of certain internal controls
related to the Company’s identification and evaluation of indicators of impairment. We assessed estimated future charter rates by comparing them to
historical rates and the rates in third-party industry publications for vessels with similar characteristics, including type and size. We examined minutes
of Board meetings and third-party industry publications to evaluate the Company’s intended use of the vessels and equipment and changes in market
conditions and events affecting the Company.
/s/ KPMG LLP
Chartered Professional Accountants
We have served as the Company’s auditor since 2011.
Vancouver, Canada
March 17, 2026
F-2
SEAPEAK LLC AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (LOSS) (note 1)
(in thousands of U.S. Dollars)
Year Ended
December 31,
2025
$
Year Ended
December 31,
2024
$
Year Ended
December 31,
2023
$
Voyage revenues (notes 6 and 12a)
636,958
710,744
726,791
Voyage expenses
(12,081)
(11,594)
(21,440)
Vessel operating expenses
(222,640)
(230,896)
(232,660)
Time-charter hire expenses
—
(8,237)
(8,777)
Depreciation and amortization
(143,982)
(142,664)
(145,728)
General and administrative expenses
(34,452)
(29,088)
(30,911)
(Write-down) gain and (loss) gain on sales of vessels (notes 3a, 6 and 18)
(71,006)
(382,770)
27,991
Restructuring charges (note 17)
(21,927)
—
—
Income (loss) from vessel operations
130,870
(94,505)
315,266
Equity income (notes 3b, 7 and 12a)
93,241
122,279
149,006
Interest expense
(165,350)
(178,417)
(187,506)
Interest income (note 7a)
12,592
14,101
11,412
Realized and unrealized (loss) gain on non-designated derivative instruments
(note 13)
(14,511)
55,663
23,993
Foreign currency exchange loss (notes 10 and 13)
(6,236)
(1,396)
(5,354)
Other (expense) income (notes 3b and 5)
(21,499)
(16,032)
21,110
Net income (loss) before income tax (expense) recovery
29,107
(98,307)
327,927
Income tax (expense) recovery (note 11)
(3,116)
2,486
(10,211)
Net income (loss)
25,991
(95,821)
317,716
Non-controlling interest in net income (loss)
(16,438)
(27,715)
13,174
Preferred unitholders' interest in net income (loss)
25,116
25,117
24,941
Common unitholder's interest in net income (loss)
17,313
(93,223)
279,601
Related party transactions (note 12)
Subsequent events (note 19)
The accompanying notes are an integral part of the consolidated financial statements.
F-3
SEAPEAK LLC AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (note 1)
(in thousands of U.S. Dollars)
Year Ended
December 31,
2025
$
Year Ended
December 31,
2024
$
Year Ended
December 31,
2023
$
Net income (loss)
25,991
(95,821)
317,716
Other comprehensive (loss) income:
Other comprehensive (loss) income before reclassifications
Unrealized (loss) gain on qualifying cash flow hedging instruments, net of tax
(6,301)
21,670
6,555
Amounts reclassified from accumulated other comprehensive income, net of tax
To equity income:
Realized gain on qualifying cash flow hedging instruments
(11,215)
(17,467)
(16,595)
To interest expense:
Realized loss on qualifying cash flow hedging instruments (note 13)
598
761
1,242
Other comprehensive (loss) income
(16,918)
4,964
(8,798)
Comprehensive income (loss)
9,073
(90,857)
308,918
Non-controlling interest in comprehensive income (loss)
(16,259)
(27,487)
13,546
Preferred unitholders' interest in comprehensive income (loss)
25,116
25,117
24,941
Common unitholder's interest in comprehensive income (loss)
216
(88,487)
270,431
The accompanying notes are an integral part of the consolidated financial statements.
F-4
SEAPEAK LLC AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (note 1)
(in thousands of U.S. Dollars, except unit data)
As at
December 31, 2025
$
As at
December 31, 2024
$
ASSETS
Current
Cash and cash equivalents (note 15a)
122,906
153,726
Restricted cash – current (note 15a)
14,455
9,210
Accounts receivable, including non-trade of $6,420 (2024 – $6,183) (note 13)
30,620
29,058
Prepaid expenses
12,489
15,162
Vessels held for sale (note 18a)
24,400
—
Current portion of derivative assets (note 13)
32,412
35,684
Current portion of net investments in direct financing and sales-type leases, net (notes 3b and 6)
21,066
20,928
Amounts due from affiliates (notes 12b and 14f)
24,087
19,679
Other current assets (note 14f)
16,501
6,619
Total current assets
298,936
290,066
Restricted cash – long-term (note 15a)
7,793
25,032
Vessels and equipment
At cost, less accumulated depreciation of $88,184 (2024 – $ 94,752) 
328,616
731,318
Vessels related to finance leases, at cost, less accumulated depreciation of $447,699 (2024 – $367,146)
(note 5)
2,156,322
1,979,630
Advances on newbuilding contracts (note 14a)
301,597
243,186
Total vessels and equipment
2,786,535
2,954,134
Investments in and advances to equity-accounted joint ventures, net (notes 3b and 7)
1,357,862
1,346,578
Net investments in direct financing and sales-type leases, net (notes 3b and 6)
581,452
625,398
Other assets
33,707
28,858
Derivative assets (note 13)
20,541
50,913
Intangible assets, net (note 8)
13,500
20,434
Goodwill (note 8)
37,308
37,308
Total assets
5,137,634
5,378,721
LIABILITIES AND EQUITY
Current
Accounts payable
8,524
7,093
Accrued liabilities and other (notes 9 and 14)
126,826
100,060
Unearned revenue (note 6)
29,300
34,733
Current portion of long-term debt (note 10)
296,188
177,093
Current obligations related to finance leases (note 5)
228,985
129,418
Current portion of derivative liabilities (note 13)
16,045
22,283
Amounts due to affiliates (note 12b)
752
6,721
Total current liabilities
706,620
477,401
Long-term debt (note 10)
595,867
882,446
Long-term obligations related to finance leases (note 5)
1,573,541
1,598,135
Other long-term liabilities (notes 3b, 6, 7a and 14e)
71,489
88,764
Derivative liabilities (note 13)
128
25,281
Total liabilities
2,947,645
3,072,027
Commitments and contingencies (notes 5, 7, 10, 13 and 14)
Equity
Common units (99.9 million units issued and outstanding at December 31, 2025 and 2024)
1,849,192
1,931,879
Preferred units (11.9 million units authorized; 11.5 million units issued and outstanding at December 31,
2025 and 2024)
278,419
278,419
Accumulated other comprehensive income
18,986
36,083
Equity
2,146,597
2,246,381
Non-controlling interest
43,392
60,313
Total equity
2,189,989
2,306,694
Total liabilities and total equity
5,137,634
5,378,721
The accompanying notes are an integral part of the consolidated financial statements.
F-5
SEAPEAK LLC AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (note 1)
(in thousands of U.S. Dollars)
Year Ended
December 31,
2025
$
Year Ended
December 31,
2024
$
Year Ended
December 31,
2023
$
Cash, cash equivalents and restricted cash provided by (used for)
OPERATING ACTIVITIES
Net income (loss)
25,991
(95,821)
317,716
Non-cash and non-operating items:
Unrealized loss (gain) on non-designated derivative instruments (note 13)
32,602
(32,215)
(3,226)
Depreciation and amortization
143,982
142,664
145,728
Write-down (gain) and loss (gain) on sales of vessels (notes 6 and 18) 
71,006
382,770
(27,991)
Unrealized foreign currency exchange loss including the effect of settlement upon
maturity or termination of cross currency swaps (note 13)
7,112
2,884
9,183
Equity income, net of distributions received of $68,499 ( 2024 – $63,263 and
2023 – $76,710)
(24,742)
(56,948)
(72,296)
Amortization of deferred financing issuance costs included in interest expense
4,148
4,418
6,367
Change in unrealized credit loss provisions included in other (expense) income
(note 3b)
21,700
22,300
(17,700)
Gain on extinguishment of obligations related to finance leases included in other
(expense) income (note 5)
—
(6,331)
(5,064)
Other non-cash items
(6,551)
(1,483)
9,953
Change in operating assets and liabilities (note 15b)
(2,389)
33,050
(6)
Net operating cash flow
272,859
395,288
362,664
FINANCING ACTIVITIES
Proceeds from issuance of long-term debt
426,833
550,885
190,000
Scheduled repayments of long-term debt and settlement of related swaps (note 13)
(195,858)
(106,903)
(242,925)
Prepayments of long-term debt
(433,000)
(432,585)
(294,951)
Financing issuance costs
(16,845)
(8,553)
(4,793)
Scheduled repayments of obligations related to finance leases
(134,832)
(131,147)
(122,263)
Cash distributions paid
(125,116)
(275,117)
(74,941)
Dividends paid to non-controlling interest
(662)
(4,411)
(864)
Proceeds from financing related to sales and leaseback of vessels (note 5)
213,000
629,685
309,778
Extinguishment of obligations related to finance leases, net of security deposits
(note 5)
—
(413,501)
(215,064)
Repurchase of preferred units (note 16)
—
—
(3,972)
Equity contributions from Stonepeak (note 16)
—
—
86,180
Net financing cash flow
(266,480)
(191,647)
(373,815)
INVESTING ACTIVITIES
Expenditures for vessels and equipment, including advances on newbuilding
contracts
(61,271)
(257,733)
(147,970)
Purchase of short-term investments
(9,200)
—
—
Sale of short-term investments
9,200
—
—
Capital returned from equity-accounted joint ventures
—
29,961
—
Acquisition of Evergas
—
—
(3,000)
Proceeds from sales of vessels (note 18)
12,078
27,705
80,569
Net investing cash flow
(49,193)
(200,067)
(70,401)
(Decrease) increase in cash, cash equivalents and restricted cash
(42,814)
3,574
(81,552)
Cash, cash equivalents and restricted cash, beginning of the year
187,968
184,394
265,946
Cash, cash equivalents and restricted cash, end of the year
145,154
187,968
184,394
Supplemental cash flow information (note 15)
The accompanying notes are an integral part of the consolidated financial statements.
F-6
SEAPEAK LLC AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN TOTAL EQUITY (note 1)
(in thousands of U.S. Dollars, except unit data)
 
TOTAL EQUITY
 
Unitholder Equity
 
 
Common
Units
Common
Units
Preferred
Units
Preferred
Units
Accumulated
Other
Comprehensive
Income (Loss)
Non-
controlling
Interest
Total
#
$
#
$
$
$
$
Balance as at December 31, 2022
88,565
1,959,228
11,689
282,484
40,517
79,529
2,361,758
Net income
—
279,601
—
24,941
—
13,174
317,716
Other comprehensive (loss) income
—
—
—
—
(9,170)
372
(8,798)
Equity contribution from Stonepeak (notes 12c
and 16)
—
86,180
—
—
—
—
86,180
Conversion of equity contributions from
Stonepeak into common units (notes 12c and
16)
11,384
—
—
—
—
—
—
Distributions declared:
Common units ($0.5003 / unit)
—
(50,000)
—
—
—
—
(50,000)
Preferred units Series A ($2.25 / unit)
—
—
—
(11,070)
—
—
(11,070)
Preferred units Series B ($2.13 / unit)
—
—
—
(13,871)
—
—
(13,871)
Repurchase of preferred units (note 16)
—
93
(160)
(4,065)
—
—
(3,972)
Dividends paid to non-controlling interest
—
—
—
—
—
(864)
(864)
Balance as at December 31, 2023
99,949
2,275,102
11,529
278,419
31,347
92,211
2,677,079
Net (loss) income
—
(93,223)
—
25,117
—
(27,715)
(95,821)
Other comprehensive income
—
—
—
—
4,736
228
4,964
Distributions declared:
Common units ($2.5013 / unit)
—
(250,000)
—
—
—
—
(250,000)
Preferred units Series A ($2.25 / unit)
—
—
—
(11,246)
—
—
(11,246)
Preferred units Series B ($2.13 / unit)
—
—
—
(13,871)
—
—
(13,871)
Dividends paid to non-controlling interest
—
—
—
—
—
(4,411)
(4,411)
Balance as at December 31, 2024
99,949
1,931,879
11,529
278,419
36,083
60,313
2,306,694
Net income (loss)
—
17,313
—
25,116
—
(16,438)
25,991
Other comprehensive (loss) income
—
—
—
—
(17,097)
179
(16,918)
Distributions declared:
Common units ($1.0005 / unit)
—
(100,000)
—
—
—
—
(100,000)
Preferred units Series A ($2.25 / unit)
—
—
—
(11,100)
—
—
(11,100)
Preferred units Series B ($2.13 / unit)
—
—
—
(14,016)
—
—
(14,016)
Dividends paid to non-controlling interest
—
—
—
—
—
(662)
(662)
Balance as at December 31, 2025
99,949
1,849,192
11,529
278,419
18,986
43,392
2,189,989
  The accompanying notes are an integral part of the consolidated financial statements.
F-7
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
1. Summary of Significant Accounting Policies
Basis of presentation
These consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (or GAAP).
They include the accounts of Seapeak LLC, which is a limited liability company formed under the laws of the Republic of the Marshall Islands, its
wholly-owned or controlled subsidiaries and any variable interest entities (or VIEs) of which it is the primary beneficiary (collectively, the Company)
(see Note 5).
The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect
the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates. Significant intercompany
balances and transactions have been eliminated upon consolidation.
Foreign currency
The consolidated financial statements are stated in U.S. Dollars and the functional currency of the Company is the U.S. Dollar. Transactions
involving other currencies during the year are converted into U.S. Dollars using the exchange rates in effect at the time of the transactions. At the
balance sheet date, monetary assets and liabilities that are denominated in currencies other than the U.S. Dollar are translated to reflect the year-
end exchange rates. Resulting gains or losses are reflected in foreign currency exchange loss in the accompanying consolidated statements of
income (loss).
Revenues
The Company’s time charters and voyage charters include both a lease component, consisting of the lease of the vessel, and a non-lease
component, consisting of the operation of the vessel for the customer. The Company has elected to not separate the non-lease component from the
lease component for all such charters, where the lease component is classified as an operating lease, and to account for the combined component
as an operating lease. The Company’s time-charter contracts accounted for as direct financing leases and sales-type leases contain both a lease
component (lease of the vessel) and a non-lease component (operation of the vessel). The Company has allocated the contract consideration
between the lease component and non-lease component on a relative standalone selling price basis. The standalone selling price of the non-lease
component has been determined using a cost-plus approach, whereby the Company estimates the cost to operate the vessel using cost
benchmarking studies prepared by a third party, when available, or internal estimates when not available, plus a profit margin. The standalone
selling price of the lease component has been determined using an adjusted market approach, whereby the Company calculates a rate excluding
the operating component based on a market time-charter rate from published broker estimates, when available, or internal estimates when not
available. Given that there are no observable standalone selling prices for either of these two components, judgment is required in determining the
standalone selling price of each component.
Time charters
Revenues from time charters accounted for as operating leases are recognized by the Company on a straight-line basis daily over the term of the
charter. If collectability of the time-charter hire receipts from time charters accounted for as operating leases is not probable, revenue that would
have otherwise been recognized is limited to the amount collected from the charterer.
Upon commencement of a time charter accounted for as a direct financing lease or a sales-type lease, the carrying value of the vessel is
derecognized and the net investment in the lease is recognized, based on the fair value of the vessel. For direct financing leases and sales-type
leases, the lease element of time-charter hire receipts is allocated to the lease receivable and voyage revenues over the term of the lease using the
effective interest rate method. The non-lease element of time-charter hire receipts is recognized by the Company on a straight-line basis daily over
the term of the charter. Drydock cost reimbursements allocable to the non-lease element of a time-charter are recognized on a straight-line basis
over the period between the previous scheduled drydock and the next scheduled drydock. In addition, if collectability of non-lease receipts of
charter payments from charterers is not probable, any such receipts are recognized as a liability unless the receipts are non-refundable and either
the time-charter contract has been terminated or the Company has no remaining performance obligations. For time-charter contracts where the
charterer is responsible for the operation of the vessel, the Company offsets any vessel operating expenses it incurs against reimbursements from
the charterer.
The Company does not recognize revenues during days that the vessel is off-hire. For variable consideration, including profit-sharing agreements,
or drydock cost reimbursements for time charters accounted for as operating leases, the Company recognizes this revenue in the period in which
the changes in facts and circumstances on which the variable charter hire payments are based occur.
Voyage charters
Revenues from voyage charters are recognized on a proportionate performance method. The Company uses a discharge-to-discharge basis in
determining proportionate performance for all spot voyages that contain a lease and a load-to-discharge basis in determining proportionate
performance for all spot voyages that do not contain a lease. The Company does not begin recognizing revenue until a charter has been agreed to
by the customer, even if the vessel has discharged its cargo and is sailing to the anticipated load port on its next voyage. The consolidated balance
sheets reflect, in other current assets, the accrued portion of revenues for those voyages that commence prior to the balance sheet date and
complete after the balance sheet date. 
F-8
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
Management fees and other income
Revenues are also earned from the management of third-party vessels and an LNG terminal in Bahrain, in which the Company has a 30% interest.
The Company recognizes fixed revenue on a straight-line basis over the duration of the management contract and variable revenue, such as
monthly commissions, in the month they are earned. The Company presents the reimbursement of expenditures it incurs to provide the promised
goods or services as revenue, if it controls such goods or services before they are transferred to the customer, and presents the reimbursement of
expenditures as an offset against the expenditures, if the Company does not control the goods or services before they are transferred to the
customer.
Operating expenses
Voyage expenses include all expenses unique to a particular voyage, including fuel expenses, port fees, cargo loading and unloading expenses,
canal tolls, agency fees and commissions. The Company, as shipowner, pays voyage expenses under voyage charters. The Company’s customers
pay voyage expenses under time charters, except when the vessel is off-hire during the term of a time-charter, in which case the Company pays
voyage expenses.
Vessel operating expenses include crewing, ship management services, repairs and maintenance, insurance, stores, lube oils and communication
expenses.
Voyage expenses and vessel operating expenses are recognized when incurred except when the Company incurs pre-operational costs related to
the repositioning of a vessel (i) that relates directly to a specific customer contract, (ii) that generates or enhances resources of the Company that
will be used in satisfying performance obligations in the future; and (iii) where such costs are expected to be recovered via the customer contract. In
this case, such costs are deferred and amortized over the duration of the customer contract.
Cash and cash equivalents
The Company classifies all highly liquid investments with an original maturity date of three months or less as cash and cash equivalents.
Restricted cash
The Company maintains restricted cash deposits relating to certain term loans, collateral for derivatives, vessels held for sale, obligations related to
finance leases and amounts received from charterers to be used only for dry-docking expenditures and emergency repairs and other obligations.
Accounts receivable and other loan receivables
Accounts receivable are recorded at the invoiced amount and do not bear interest. The consolidated balance sheets reflect amounts where the right
to consideration is conditioned upon the passage of time as "accounts receivable," and reflect accrued revenue where the right to consideration is
conditioned upon something other than the passage of time as "other current assets."
The Company’s advances to equity-accounted joint ventures and any other investments in loan receivables are recorded at cost, net of provision for
expected credit losses.
Vessels and equipment
All pre-delivery costs incurred during the construction of newbuildings, including interest and supervision and technical costs, are capitalized. The
acquisition cost and all costs incurred to restore used vessels purchased by the Company to the standards required to properly service the
Company’s customers are capitalized. Interest costs capitalized to advances on newbuilding contracts for the year ended December 31, 2025
amounted to $14.6 million (December 31, 2024 - $14.6 million and December 31, 2023 - $13.1 million) (see Note 14a).
Vessel capital modifications include the addition of new equipment or certain modifications to the vessel which are aimed at improving or increasing
the operational efficiency and functionality of the asset. This type of expenditure is capitalized and depreciated over the estimated useful life of the
modification. Expenditures covering recurring routine repairs and maintenance are expensed as incurred.
Depreciation is calculated on a straight-line basis over a vessel’s estimated useful life, less an estimated residual value. Depreciation is calculated
using an estimated useful life of 30 years for natural gas liquids (or NGL) carriers and 35 years for liquefied natural gas (or LNG) carriers, from the
date the vessel is delivered from the shipyard, or a shorter period if regulations or commercial considerations prevent the Company from operating
the vessels for 30 years, or 35 years, respectively. Effective January 1, 2025, the Company reduced to 25 years the estimated useful life of its
seven steam turbine LNG carriers, the oldest vessels in the Company's LNG fleet. Following a revision on the outlook of the three steam turbine
LNG carriers in the RasGas II Joint Venture (or the RasGas II Joint Venture vessels) during 2025, effective October 1, 2025, the Company has
further reduced to 20 years the estimated useful life of these three vessels (see Note 18a). Had we continued to depreciate the seven steam turbine
LNG carriers, which includes the three RasGas II Joint Venture vessels, using an estimated useful life of 35 years instead of 25 years from the
beginning of the fiscal period, depreciation and amortization would have decreased by $19.5 million, write-down of vessels would have increased by
$8.8 million and net income would have increased by $10.7 million for the year ended December 31, 2025. Had we continued to depreciate the
RasGas II Joint Venture vessels using an estimated useful life of 25 years instead of 20 years from October 1, 2025, depreciation and amortization
would have decreased and net income would have increased by $11.3 million for the year ended December 31, 2025. Depreciation of vessels and
equipment, excluding amortization of dry-docking expenditures, for the years ended December 31, 2025, 2024 and 2023 aggregated to $123.0
million, $113.4 million and $102.2 million, respectively. Depreciation and amortization includes depreciation on all owned vessels and owned
vessels related to finance leases.
Generally, the Company dry docks each of its vessels every 2.5 years to 5 years. The Company capitalizes certain costs incurred during dry
docking and amortizes those costs on a straight-line basis from the completion of a dry docking to the estimated completion of the next dry docking.
F-9
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
The Company includes in capitalized dry docking those costs incurred as part of the dry docking to meet classification and regulatory requirements.
The Company expenses costs related to routine repairs and maintenance performed during dry docking.
The following table summarizes the change in the Company’s capitalized dry-docking costs from January 1, 2023 to December 31, 2025:
Year Ended
December 31,
2025
$
Year Ended
December 31,
2024
$
Year Ended
December 31,
2023
$
Balance at January 1,
31,358
60,639
58,311
Cost incurred for dry docking
16,847
7,939
24,349
Transfer to vessels held for sale and write-down of vessels
(1,127)
(18,130)
(3,920)
Dry-dock amortization
(13,936)
(19,090)
(18,101)
Balance at December 31,
33,142
31,358
60,639
Vessels and equipment that are intended to be held and used in the Company's business are assessed for impairment when events or
circumstances indicate the total net carrying value of the asset group, consisting of the vessel and its customer contract, may not be recoverable.
The Company's evaluation of events or circumstances that may indicate impairment include, amongst others, the estimated future charter rates and
the Company's intended use of the vessels. If the total net carrying value of the asset group exceeds the estimated net undiscounted cash flows
expected to be generated over the asset group's remaining useful life and the fair value of the asset group is less than its carrying value, the total
net carrying value of the vessel and its customer contract is reduced to its estimated fair value. The impairment loss is allocated to each long-lived
asset within the asset group on a pro-rata basis using the relative carrying amount of those assets, except that the loss allocated to each asset
within the asset group should not reduce the carrying amount of that asset below its fair value whenever the fair value of that individual asset is
determinable without undue cost and effort. The estimated fair value for the Company’s impaired vessels is determined using discounted cash flows
or appraised values. In cases where an active second-hand sale and purchase market does not exist, or in certain other cases, the Company uses
a discounted cash flow approach to estimate the fair value of an impaired vessel and customer contract. In cases where an active second-hand
sale and purchase market exists, an appraised value is used to estimate the fair value of an impaired vessel. An appraised value is generally the
amount the Company would expect to receive if it were to sell the vessel. Such appraisal is based on second-hand sale and purchase data, and
other information provided by third parties.
Vessels and equipment that are "held for sale" are measured at the lower of their carrying value or fair value less costs to sell and are not
depreciated while classified as held for sale. Interest and other expenses and related liabilities attributable to vessels and equipment classified as
held for sale continue to be recognized as incurred.
Equity-accounted joint ventures
The Company’s investments in certain joint ventures, in which the Company does not control the entity but has the ability to exercise significant
influence over the operating and financial policies of the entity, are accounted for using the equity method of accounting. Under the equity method of
accounting, investments are stated at initial cost and are adjusted for subsequent additional investments and the Company’s proportionate share of
comprehensive earnings or losses and distributions. The Company evaluates its equity-accounted joint ventures for impairment when events or
circumstances indicate that the carrying value of such investments may have experienced an other-than-temporary decline in value below its
carrying value. If an equity-accounted investment is impaired and if the estimated fair value is less than its carrying value, the carrying value is
written down to its estimated fair value and the resulting impairment is recorded in the Company’s consolidated statements of income (loss). The
Company’s maximum exposure to loss is the amount it has invested in and advanced to its equity-accounted joint ventures, and the Company's
proportionate share of the long-term debt and interest rate swaps that it has guaranteed within its equity-accounted joint ventures.
Distributions received from equity-accounted joint ventures are presented in the Company’s consolidated statements of cash flows as a cash inflow
from operating activities or a cash inflow from investing activities, depending on whether the nature of the activity or activities of the equity-
accounted joint venture that generated the distribution was a return on investment (classified as a cash inflow from operating activities) or a return
of investment (classified as a cash inflow from investing activities).
Debt issuance costs
Debt issuance costs related to a recognized debt liability, including fees, commissions and legal expenses, are deferred and presented as a direct
reduction from the carrying amount of that debt liability and amortized on an effective interest rate method over the term of the relevant loan. Debt
issuance costs that are not attributable to a specific debt liability or where the debt issuance costs exceed the carrying value of the related debt
liability (primarily undrawn revolving credit facilities) are deferred and presented as other non-current assets in the Company's consolidated balance
sheets. Amortization of debt issuance costs is included in interest expense in the Company’s consolidated statements of income (loss).
Fees paid to substantially amend a non-revolving credit facility are associated with the extinguishment of the old debt instrument and included in
determining the debt extinguishment gain or loss to be recognized. Other costs incurred with third parties directly related to the extinguishment are
deferred and presented as a direct reduction from the carrying amount of the replacement debt instrument and amortized using the effective interest
rate method. In addition, any unamortized debt issuance costs associated with the old debt instrument are written off. If the amendment is
considered not to be a substantial amendment, then the fees would be associated with the replacement or modified debt instrument and, along with
any existing unamortized premium, discount and unamortized debt issuance costs, would be amortized as an adjustment of interest expense over
the remaining term of the replacement or modified debt instrument using the effective interest method. Other costs incurred with third parties directly
related to the modification, other than the loan amendment fee, are expensed as incurred.
F-10
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
Fees paid to amend a revolving credit facility are deferred and amortized over the term of the modified revolving credit facility. If the borrowing
capacity of the revolving credit facility increases as a result of the amendment, unamortized debt issuance costs of the original revolving credit
facility are amortized over the remaining term of the modified revolving credit facility. If the borrowing capacity of the revolving credit facility
decreases as a result of the amendment, a proportionate amount, based on the reduction in borrowing capacity, of the unamortized debt issuance
costs of the original revolving credit facility is written off and the remaining amount is amortized over the remaining term of the modified revolving
credit facility.
Goodwill and intangible assets
Goodwill is not amortized but is reviewed for impairment at the reporting unit level on an annual basis or more frequently if an event occurs or
circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. A reporting unit is a
component of the Company that constitutes a business for which discrete financial information is available and regularly reviewed by management.
When goodwill is reviewed for impairment, the Company may elect to assess qualitative factors to determine whether it is more likely than not that
the fair value of a reporting unit is less than its carrying amount, including goodwill. Alternatively, the Company may bypass this step and use a fair
value approach to identify potential goodwill impairment and, when necessary, measure the amount of impairment. The Company uses a
discounted cash flow model to determine the fair value of reporting units, unless there is a readily determinable fair market value. Goodwill
impairment is measured as the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying value of goodwill.
Customer contract intangible assets are amortized over the expected life of a customer contract. The amount amortized each year is weighted
based on the projected revenue to be earned under the contracts. Customer contract intangible assets are assessed for impairment, along with the
vessel asset servicing the customer contract, when and if impairment indicators exist. An impairment loss is recognized if the carrying amount of an
intangible asset and related vessel asset is not recoverable and their carrying amount exceeds their fair value.
Lease obligations and right-of-use assets
As of the lease commencement date, the Company recognizes a liability for its lease obligation, initially measured at the present value of lease
payments not yet paid, and an asset for its right to use the underlying asset, initially measured equal to the lease liability and adjusted for lease
payments made at or before lease commencement, lease incentives, and any initial direct costs. The initial recognition of the lease obligation and
right-of-use asset excludes short-term leases for the Company’s vessels and office leases. Short-term leases are leases with an original term of one
year or less, excluding those leases with an option to extend the lease for greater than one year or an option to purchase the underlying asset that
the lessee is deemed reasonably certain to exercise. The initial recognition of this lease obligation and right-of-use asset excludes variable lease
payments that are based on the usage or performance of the underlying asset and the portion of payments related to non-lease elements of vessel
charters.
The Company uses the effective interest rate method to subsequently account for the lease liability, whereby interest is recognized in interest
expense in the Company’s consolidated statements of income (loss). For those leases classified as operating leases, lease interest and right-of-use
asset amortization in aggregate result in a straight-line expense profile that is presented in time-charter hire expense for vessels and general and
administrative expense for office leases, unless the right-of-use asset becomes impaired. For those leases classified as finance leases, the right-of-
use asset is amortized on a straight-line basis over the remaining life of the vessel, with such amortization included in depreciation and amortization
in the Company’s consolidated statements of income (loss). Variable lease payments that are based on the usage or performance of the underlying
asset are recognized as an expense when incurred, unless achievement of a specified target triggers the lease payment, in which case an expense
is recognized in the period when achievement of the target is considered probable.
The Company recognizes the expense from short-term leases and any non-lease components of vessels time-chartered from other owners, on a
straight-line basis over the firm period of the charters. The expense is included in time-charter hire expense for vessel charters and general and
administrative expenses for office leases.
The Company recognizes that time-charter-in contracts contain both a lease component (lease of the vessel) and a non-lease component
(operation of the vessel). The Company allocates the contract consideration between the lease component and non-lease component on a relative
standalone selling price basis. The standalone selling price of the non-lease component is determined using a cost-plus approach, whereby the
Company estimates the cost to operate the vessel using cost benchmarking studies prepared by a third party, when available, or internal estimates
when not available, plus a profit margin. The standalone selling price of the lease component is determined using an adjusted market approach,
whereby the Company calculates a rate excluding the operating component based on market time-charter rate information from published broker
estimates, when available, or internal estimates when not available. Given that there are no observable standalone selling prices for either of these
two components, judgment is required in determining the standalone selling price of each component. The discount rate of the lease is determined
using the Company’s incremental borrowing rate, which is based on the fixed interest rate the Company could obtain when entering into a secured
loan facility with similar terms.
The right-of-use asset is assessed for impairment when events or circumstances indicate the carrying amount of the asset may not be recoverable.
If the right-of-use asset’s net carrying value exceeds the net undiscounted cash flows expected to be generated over its remaining useful life, the
carrying amount of the right-of-use asset is reduced to its estimated fair value. The estimated fair value for the Company's impaired right-of-use
assets from vessel in-charters is determined using a discounted cash flow approach to estimate the fair value. Subsequent to an impairment, a
right-of-use asset related to an operating lease is amortized on a straight-line basis over its remaining life.
Vessels sold and leased back by the Company, where the Company has a fixed price repurchase obligation or other situations where the leaseback
would be classified as a finance lease, are accounted for as a failed sale of the vessel. The Company does not derecognize the vessel sold and
continues to depreciate the vessel as if it was the legal owner. Proceeds received from the sale of the vessel are recognized as an obligation
related to finance lease and bareboat charter hire payments made by the Company to the lessor are allocated between interest expense and
principal repayments on the obligation related to finance lease. Such vessels are presented in the Company's consolidated balance sheets as
vessels related to finance leases.
F-11
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
Credit losses
The Company utilizes a lifetime expected credit loss measurement objective for the recognition of credit losses for net investments in direct
financing and sales-type leases, loans to equity-accounted joint ventures, guarantees of secured loan facilities of equity-accounted joint ventures,
non-operating lease accounts receivables, contracts assets and other receivables at the time the financial asset is originated or acquired. The
expected credit losses are subsequently adjusted each period for changes in expected lifetime credit losses. The Company discontinues the accrual
of interest on financial assets if collection of required payments is no longer probable, and in those situations, recognizes payments received on
such assets on a cash basis method, until collection of required payments becomes probable. The Company considers a financial asset to be past
due when payment is not made within 30 days of it being owed, assuming there is no dispute or other uncertainty regarding the amount owing.
Expected credit loss provisions are presented on the consolidated balance sheets as a reduction to the carrying value of the related financial asset
and as an other long-term liability for expected credit loss provisions that relate to guarantees of secured loan facilities of equity-accounted joint
ventures. Changes in expected credit loss provisions are presented within other (expense) income in the Company's consolidated statements of
income (loss).
For charter contracts being accounted for as operating leases, if the remaining lease payments are no longer probable of being collected any
unpaid accounts receivable and any accrued revenue will be reversed against revenue and any subsequent payments will be recognized as
revenue when collected until such time that the remaining lease payments are probable of being collected.
Derivative instruments
All derivative instruments are initially recorded at fair value as either assets or liabilities in the accompanying consolidated balance sheets and
subsequently remeasured to fair value each period end, regardless of the purpose or intent for holding the derivative. The method of recognizing
the resulting gain or loss is dependent on whether the derivative contract is designed to hedge a specific risk and whether the contract qualifies for
hedge accounting.
When a derivative is designated as a cash flow hedge, the Company formally documents the relationship between the derivative and the hedged
item. This documentation includes the strategy and risk management objective for undertaking the hedge and the method that will be used to
assess the effectiveness of the hedge. The Company does not apply hedge accounting if it is determined that the hedge was not effective or will no
longer be effective, the derivative was sold or exercised, or the hedged item was sold, repaid or no longer probable of occurring.
For derivative financial instruments designated and qualifying as cash flow hedges, changes in the fair value of the derivative financial instruments
are initially recorded as a component of accumulated other comprehensive income in total equity. In the periods when the hedged items affect
earnings, the associated fair value changes on the hedging derivatives are transferred from total equity to the corresponding earnings line item (e.g.
interest expense) in the Company’s consolidated statements of income (loss). If a cash flow hedge is terminated or dedesignated and the originally
hedged item is still considered probable of occurring, the gains and losses initially recognized in total equity remain there until the hedged item
impacts earnings, at which point they are transferred to the corresponding earnings line item in the Company’s consolidated statements of income
(loss). If the hedged items are no longer probable of occurring, amounts recognized in total equity are immediately transferred to the corresponding
earnings line item in the Company’s consolidated statements of income (loss).
For derivative financial instruments that are not designated or that do not qualify as hedges under Financial Accounting Standards Board (or FASB)
Accounting Standards Codification (or ASC) 815, Derivatives and Hedging, changes in the fair value of the derivative financial instruments are
recognized in earnings. Gains and losses from the Company’s non-designated interest rate swaps are recorded in realized and unrealized (loss)
gain on non-designated derivative instruments in the Company’s consolidated statements of income (loss). Gains and losses from the Company’s
cross currency swaps are recorded in foreign currency exchange loss in the Company’s consolidated statements of income (loss). Cash flows
associated with the settlement of interest rate swaps and the interest component of cross currency swaps are presented within operating activities,
whereas cash flows associated with the component of a cross currency swap that hedges the repayment of foreign currency denominated debt are
presented within financing activities. 
Income taxes
The Company accounts for income taxes using the liability method. Under the liability method, deferred tax assets and liabilities are recognized for
the anticipated future tax effects of temporary differences between the consolidated financial statement basis and the tax basis of the Company’s
assets and liabilities using the applicable jurisdictional tax rates. A valuation allowance for deferred tax assets is recorded when it is more-likely-
than-not that some or all of the benefit from the deferred tax asset will not be realized.
The Company recognizes the tax benefits of uncertain tax positions only if it is more-likely-than-not that a tax position taken or expected to be taken
in a tax return will be sustained upon examination by the taxing authorities, including resolution of any related appeals or litigation processes, based
on the technical merits of the position. The tax benefits recognized in the Company’s consolidated financial statements from such positions are
measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The Company recognizes
interest and penalties related to uncertain tax positions in income tax (expense) recovery in the Company’s consolidated statements of income
(loss).
F-12
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
Environmental Emissions
Effective January 1, 2024, emissions emitted by the maritime industry have been integrated in the European Union Emissions Trading System (or
EU ETS) (see Note 14f). Under the EU ETS, the Company recognizes a liability at each period end based on the total number of Emissions
Allowances (or EUAs) required to be submitted based on emissions occurring on or prior to the period end. Each EUA represents a carbon credit
that grants the holder the right to emit one tonne of CO2 equivalent under the EU ETS. The obligation to submit EUAs is included in accrued
liabilities in the Company’s consolidated balance sheets, if required to be submitted within one year of the balance sheet date, or otherwise in other
long-term liabilities. For vessels that the Company manages for its equity-accounted joint ventures, the Company recognizes a concurrent
receivable from its equity-accounted joint ventures consisting of the amount of the obligation to submit EUAs. For the Company’s vessels under its
management, the Company recognizes a concurrent accrued receivable due from charterers consisting of the portion of the obligation to submit
EUAs that the Company is entitled to recover from charterers. The cost of EUAs that cannot be recovered from charterers is reflected within voyage
expenses in the Company’s consolidated statement of income (loss). EUAs purchased by the Company or received from charterers are initially
recognized as an asset at cost based on their purchase price if acquired by the Company, or their fair value on date of receipt, if received from
charterers. EUAs held by the Company are included in other current assets in the Company’s consolidated balance sheets, if required to be
submitted within one year of the balance sheet date, or otherwise in other assets. EUAs are derecognized on a first-in-first-out basis upon their
submission to the applicable regulatory authority.
Guarantees
Guarantees issued by the Company, excluding those that are guaranteeing its own performance, are recognized at fair value at the time the
guarantees are issued and are presented in the Company’s consolidated balance sheets as other long-term liabilities. The liability recognized on
issuance is amortized to other (expense) income on the Company’s consolidated statements of income (loss) over the term of the guarantee. If it
becomes probable that the Company will have to perform under a guarantee, the Company will recognize an additional liability if the amount of the
loss can be reasonably estimated.
2. Accounting Pronouncements
In December 2023, the FASB issued ASU 2023-09 – Income Taxes (Topic 740) Improvements to Income Tax Disclosures (or ASU 2023-09). This
ASU enhances the transparency and decision usefulness of income tax disclosures. More specifically, this ASU requires that additional income tax
information be disclosed about the jurisdictions in which the Company operates within its income tax rate reconciliation, as well as its disclosure
about income taxes paid. The adoption of this ASU during 2025 was done on a prospective basis and did not have a material impact on the
Company's consolidated financial statements.
In November 2024, the FASB issued ASU 2024-03 – Income Statement – Reporting Comprehensive Income – Expense Disaggregation
Disclosures ( Subtopic 220-40) Disaggregation of Income Statement Expenses (or ASU 2024-03). This ASU improves the disclosures about a public
business entity’s expenses and addresses requests from investors for more detailed information about the types of expenses (including purchases
of inventory, employee compensation, depreciation, amortization, and depletion) in commonly presented expense captions (such as cost of sales,
selling, general and administrative expenses, and research and development). This ASU is effective for annual periods beginning after December
15, 2026 and interim periods beginning after December 15, 2027. The amendments in this ASU are applied either (1) prospectively to financial
statements issued for reporting periods after the effective date of this ASU or (2) retrospectively to any or all prior periods presented in the financial
statements. The Company does not expect that adoption of ASU 2024-03 will have a material impact on the Company's consolidated financial
statements.
3. Fair Value Measurements and Financial Instruments
a) Fair Value Measurements
The following methods and assumptions were used to estimate the fair value of each class of financial instrument:
Cash and cash equivalents and restricted cash – The fair value of the Company’s cash and cash equivalents and restricted cash approximates
its carrying amounts reported in the consolidated balance sheets.
Interest rate swap agreements, foreign currency forward contracts and cross currency swap agreements – The fair value of these derivative
instruments of the Company is the estimated amount that the Company would receive or pay to terminate the agreements at the reporting date,
taking into account current interest rates, foreign exchange rates and the current credit worthiness of both the Company and the derivative
counterparties. The estimated amount is the present value of future cash flows. The Company transacts all of these derivative instruments through
investment-grade rated financial institutions at the time of the transaction. The Company's interest rate swap agreements do not require the
Company to provide cash collateral to these institutions; however, cash collateral may be required by certain institutions on some of the Company's
cross currency swap agreements and as at December 31, 2025, the Company had pledged $3.8 million cash as collateral (December 31, 2024 –
$19.5 million), which has been recorded as restricted cash – current and restricted cash – long-term on the Company's consolidated balance
sheets. Given the current volatility in the credit markets, it is reasonably possible that the amount recorded as a derivative asset or liability could
vary by a material amount in the near term. Minor changes to the forward interest curves and forward foreign exchange rates used as inputs to the
valuations may have a significant effect on the fair value of these derivative instruments.
Long-term debt – The fair values of the Company’s fixed-rate and variable-rate long-term debt are either based on quoted market prices or
estimated by the Company using discounted cash flow analyses based on rates currently available for debt with similar terms and remaining
maturities and the current credit worthiness of the Company.
Long-term obligations related to finance leases – The fair values of the Company's long-term obligations related to finance leases are estimated
by the Company using discounted cash flow analyses based on rates currently available for debt with similar terms and remaining maturities and
the current credit worthiness of the Company.
F-13
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
The Company categorizes the fair value estimates by a fair value hierarchy based on the inputs used to measure fair value. The fair value hierarchy
has three levels based on the reliability of the inputs used to determine fair value as follows:
Level 1. Observable inputs such as quoted prices in active markets;
Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and
Level 3. Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.
The following table includes the estimated fair value and carrying value of those assets and liabilities that are measured at fair value on a recurring
and non-recurring basis, as well as the estimated fair value of the Company’s financial instruments that are not accounted for at a fair value on a
recurring basis.
 
 
December 31, 2025
December 31, 2024
Fair Value
Hierarchy
Level
Carrying
Amount
Asset
(Liability)
$
Fair Value
Asset
(Liability)
$
Carrying
Amount
Asset
(Liability)
$
Fair Value
Asset
(Liability)
$
Recurring:
  Cash and cash equivalents and restricted cash (note 15a)
Level 1
145,154
145,154
187,968
187,968
  Derivative instruments (note 13)
      Interest rate swap agreements – assets
Level 2
54,214
54,214
88,025
88,025
      Interest rate swap agreements – (liabilities)
Level 2
(128)
(128)
—
—
      Foreign currency contracts – assets
Level 2
210
210
—
—
      Foreign currency contracts – (liabilities)
Level 2
—
—
(527)
(527)
      Cross currency swap agreements – assets 
Level 2
192
192
937
937
      Cross currency swap agreements – (liabilities)
Level 2
(16,045)
(16,045)
(47,037)
(47,037)
Non-recurring:
  Vessels held for sale (note 18a)
Level 2
24,400
24,400
—
—
  Vessels and equipment (note 18a)
Level 3
—
—
294,631
294,631
Other:
Loans to equity-accounted joint ventures (note 7a(ii))
(i)
105,970
(i)
99,806
(i)
Long-term debt – public (note 10)
Level 1
(98,865)
(100,407)
(174,720)
(180,334)
Long-term debt – non-public (note 10)
Level 2
(793,190)
(799,247)
(884,819)
(886,224)
Obligations related to finance leases (note 5)
Level 2
(1,802,526)
(1,800,536)
(1,727,553)
(1,715,651)
(i) The advances to equity-accounted joint ventures together with the Company’s equity investments in the joint ventures form the net aggregate carrying
value of the Company’s interests in the joint ventures in these consolidated financial statements. The fair values of the individual components of such
aggregate interests are not determinable.
b) Credit Losses
As at December 31, 2025 and 2024, the Company's exposure to potential credit losses under ASC 326, Financial Instruments – Credit Losses
included its four direct financing and sales-type leases, one of its loans to equity-accounted joint ventures and its guarantees of its proportionate
share of secured loan facilities of three of its equity-accounted joint ventures. In addition, the Company's exposure to potential credit losses within
its equity-accounted joint ventures under ASC 326 primarily includes: direct financing and sales-types leases for 14 LNG carriers within its 50%-
owned joint venture with China LNG Shipping (Holdings) Limited (or China LNG) (or the Yamal LNG Joint Venture); its 40%-owned joint venture
with Teekay Nakilat (III) Corporation (or the RasGas III Joint Venture); its 33%-owned joint venture with NYK Energy Transport (or NYK) and Mitsui
& Co., Ltd. (or the Angola Joint Venture); and one floating storage unit (or FSU) and an LNG regasification terminal joint venture within Bahrain
LNG W.L.L (or the Bahrain LNG Joint Venture) (see Note 7a).
F-14
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
The following table includes the amortized cost basis of the Company’s direct interests in financing receivables and net investment in direct
financing and sales-type leases by class of financing receivables and by period of origination and their associated credit quality as at December 31,
2025 and 2024.
As at December 31,
2025
2024
Period of
Origination
Credit
Quality
  Grade (i)
Amortized
Cost Basis
$
Credit
Quality
  Grade (i)
Amortized
Cost Basis
$
Direct financing and sales-type leases
  Tangguh Hiri and Tangguh Sago
2017 and prior
Performing
257,445
Performing
274,928
  Seapeak Bahrain
2018
Performing
197,250
Performing
200,872
  Seapeak Creole
2023
Performing
200,723
Performing
202,526
655,418
678,326
Loans to equity-accounted joint ventures
  Bahrain LNG Joint Venture
2017 and prior
Performing
105,970
Performing
99,806
761,388
778,132
(i) The Company's credit quality grades are based on internal risk credit ratings whereby a credit quality grade of performing is consistent with a low
likelihood of loss. The Company assesses the credit quality of its direct financing and sales-type leases on whether there are no past due payments (30
days late), no concessions granted to the counterparties and whether the Company is aware of any other information that would indicate that there is a
material increase of likelihood of loss. The same policy is applied by the equity-accounted joint ventures. The Company assesses the credit quality of its
loan to the Bahrain LNG Joint Venture based on whether there are any past due payments from the Bahrain LNG Joint Venture’s primary customer,
whether the Bahrain LNG Joint Venture has granted any concessions to its primary customer and whether the Company is aware of any other
information that would indicate that there is a material increase of likelihood of loss. As at December 31, 2025 and 2024, all direct financing and sales-
type leases held by the Company and the Company’s equity-accounted joint ventures had a credit quality grade of performing. 
Changes in the Company's allowance for credit losses for the years presented in these consolidated financial statements are as follows:
Direct
financing and
sales-type
leases (i)
$
Direct financing
and sales-type
leases and other
within equity-
accounted joint
ventures (i)
$
Loans to equity-
accounted joint
ventures (ii)
$
Guarantees of
debt (iii)
$
Total
$
As at January 1, 2023
26,200
36,600
2,900
1,300
67,000
Reversal of potential credit losses
(16,500)
(13,900)
(800)
(400)
(31,600)
As at December 31, 2023
9,700
22,700
2,100
900
35,400
Provision for (reversal of) potential credit losses
22,300
6,900
(300)
300
29,200
As at December 31, 2024
32,000
29,600
1,800
1,200
64,600
Provision for (reversal of) potential credit losses
20,900
21,300
1,100
(300)
43,000
As at December 31, 2025
52,900
50,900
2,900
900
107,600
(i) The credit loss provision related to the lease receivable component of the net investment in direct financing and sales-type leases is based on an
internal historical loss rate, as adjusted when asset specific risk characteristics of the existing lease receivables at the reporting date are not consistent
with those used to measure the internal historical loss rate and as further adjusted when management expects current conditions and reasonable and
supportable forecasts to differ from the conditions that existed to measure the internal historical loss rate. During the years presented in these
consolidated financial statements, two LNG project counterparties maintained investment grade credit ratings. As such, at December 31, 2025, 2024
and 2023, the internal historical loss rate used to determine the credit loss provision was adjusted downward to reflect a lower risk for two of these LNG
projects and at January 1, 2023, the downward risk adjustment was made for one of these LNG projects at such dates compared to the average LNG
project used to determine the internal historical loss rate. In addition, the internal historical loss rate was adjusted upwards for (a) one LNG project to
reflect a lower credit rating for the counterparty, including consideration of the critical infrastructure nature of LNG production, and (b) a second LNG
project to reflect a larger potential risk of loss upon potential default as the vessels servicing this project have fewer opportunities for redeployment
compared to the Company’s other LNG carriers. The credit loss provision for the residual value component is based on a reversion methodology
whereby the current estimated fair value of the vessel as depreciated to the end of the charter contract is compared to the expected carrying value, with
such potential gain or loss on maturity being included in the credit loss provision in increasing magnitude on a straight-line basis the closer the contract
is to its maturity. Risks related to the net investments in direct financing and sales-type leases consist of risks related to the underlying LNG projects and
demand for LNG carriers at the end of the time-charter contracts.
The change in credit loss provision of $20.9 million for the Company's consolidated vessels for the year ended December 31, 2025 ($22.3 million during
2024 and $(16.5) million during 2023) is included in other (expense) income in the Company's consolidated statements of income (loss). The change in
credit loss provision for the year ended December 31, 2025 primarily reflects a decrease in the estimated charter-free valuations for certain types of its
LNG carriers at the end of their time-charter contracts, which are accounted for as direct financing and sales-type leases in the Company's consolidated
balance sheets. These estimated future charter-free values are subject to change based on the underlying LNG shipping market fundamentals. 
F-15
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
The change in credit loss provision of $21.3 million for the year ended December 31, 2025 ($6.9 million during 2024 and $(13.9) million during 2023)
relating to the direct financing and sales-type leases and other within the Company's equity-accounted joint ventures is included in equity income in the
Company's consolidated statements of income (loss). The change in credit loss provision for the year ended December 31, 2025 primarily reflects a
decrease in the estimated charter-free valuations for certain types of LNG carriers at the end of their time-charter contracts, which are accounted for as
direct financing and sales-type leases within investments in equity-accounted joint ventures in the Company's consolidated balance sheets.
The changes in the credit loss provision for the Company's consolidated vessels and the vessels within the Company's equity-accounted joint ventures
for the year ended December 31, 2025 do not reflect any material change in expectations of the charterers' ability to make their time-charter hire
payments as they come due compared to the beginning of the year.
(ii) The determination of the credit loss provision for such loans is based on their expected duration and on an internal historical loss rate of the Company
and its affiliates, as adjusted when asset specific risk characteristics of the existing loans at the reporting date are not consistent with those used to
measure the internal historical loss rate and as further adjusted when management expects current conditions and reasonable and supportable
forecasts to differ from the conditions that existed to measure the internal historical loss rate. These loans rank behind secured debt in each equity-
accounted joint venture. As such, they are similar to equity in terms of risk. The Bahrain LNG Joint Venture owns an LNG receiving and regasification
terminal in Bahrain. The ability of Bahrain LNG Joint Venture to repay its loan to the Company is primarily dependent upon the Bahrain LNG Joint
Venture’s customer, a company owned by the Kingdom of Bahrain, fulfilling its obligations under the 20-year agreement, as well as the Bahrain LNG
Joint Venture’s ability to operate the terminal in accordance with the agreed upon operating criteria.
(iii) The determination of the credit loss provision for such guarantees was based on a probability of default and loss given default methodology. In
determining the overall estimated loss from default as a percentage of the outstanding guaranteed share of secured loan facilities and finance leases,
the Company considers current and future operational performance of the vessels securing the loan facilities and finance leases and current and future
expectations of the proceeds that could be received from the sale of the vessels securing the loan facilities and finance leases in comparison to the
outstanding principal amount of the loan facilities and finance leases if the Company was required to fulfill its obligations under the guarantees. See
Note 7d relating to the guarantees the Company provides for its equity-accounted joint ventures.
4. Segment Reporting
The Company has two reportable segments, the LNG segment and the NGL segment. The Company’s LNG segment consists of LNG carriers
which generally operate under long-term, fixed-rate time-charter contracts to international energy companies. The Company's NGL segment
consists of LPG, Ethane and multi-gas carriers which generally operate under voyage charters or time-charters. As at December 31, 2025, the
Company’s LNG segment consisted of 51 LNG carriers and LNG carrier newbuildings (including 24 LNG carriers included in joint ventures that are
accounted for under the equity method) and one LNG receiving and regasification terminal in Bahrain. As at December 31, 2025, the Company's
NGL segment consisted of 42 LPG, Ethane and multi-gas carriers and LPG newbuildings (including 32 LPG carriers and newbuildings included in a
joint venture that is accounted for under the equity method). The Company's chief operating decision maker is the Company's President and Chief
Executive Officer who evaluates segment results based on income (loss) from vessel operations. The evaluation of segment results involves an
assessment of the profitability of each segment. This information, along with forward-looking assessments of profitability, help the Company's chief
operating decision maker to make informed decisions about investing and/or divesting of assets in a specific segment. The accounting policies
applied to the reportable segments are the same as those used in the preparation of the Company’s consolidated financial statements.
The following table presents voyage revenues and percentage of consolidated voyage revenues for the Company’s customers who accounted for
10% or more of the Company's consolidated voyage revenues during any of the years presented in these consolidated financial statements.
(U.S. Dollars in millions)
Year Ended
December 31,
2025
Year Ended
December 31,
2024
Year Ended
December 31,
2023
INEOS Europe AG(i)
$114.1 or 18%
$115.4 or 16%
$114.1 or 16%
Shell Plc. and subsidiaries(ii)
$95.3 or 15%
$115.2 or 16%
$118.9 or 16%
Ras Laffan Liquefied Natural Gas Company Ltd.(ii)
$75.1 or 12%
$75.0 or 11%
$74.2 or 10%
(i) NGL segment.
(ii) LNG segment.
F-16
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
The following tables include results for these segments for the years presented in these consolidated financial statements.
 
Year Ended December 31, 2025
LNG
Segment
$
NGL
Segment
$
Total
$
Voyage revenues
522,468
114,490
636,958
Voyage expenses
(11,178)
(903)
(12,081)
Vessel operating expenses
(186,710)
(35,930)
(222,640)
Depreciation and amortization
(111,816)
(32,166)
(143,982)
General and administrative expenses(i)
(30,971)
(3,481)
(34,452)
Write-down and loss on sale of vessels (note 18a)
(71,006)
—
(71,006)
Restructuring charges (note 17)
(21,927)
—
(21,927)
Income from vessel operations
88,860
42,010
130,870
Equity income (note 7)
67,525
25,716
93,241
Investment in and advances to equity-accounted joint ventures, net
1,142,885
214,977
1,357,862
Expenditures for vessels and equipment, including advances on newbuilding contracts
(59,302)
(1,293)
(60,595)
Expenditures for dry docking
(4,233)
(12,614)
(16,847)
 
Year Ended December 31, 2024
 
LNG
Segment
$
NGL
Segment
$
Total
$
Voyage revenues
566,614
144,130
710,744
Voyage expenses
(4,598)
(6,996)
(11,594)
Vessel operating expenses
(181,427)
(49,469)
(230,896)
Time-charter hire expenses
—
(8,237)
(8,237)
Depreciation and amortization
(111,339)
(31,325)
(142,664)
General and administrative expenses(i)
(23,402)
(5,686)
(29,088)
(Write-down) and gain on sales of vessels (note 18)
(387,109)
4,339
(382,770)
(Loss) income from vessel operations
(141,261)
46,756
(94,505)
Equity income (note 7)
94,577
27,702
122,279
Investment in and advances to equity-accounted joint ventures, net
1,158,718
187,860
1,346,578
Expenditures for vessels and equipment, including advances on newbuilding contracts
(256,540)
(645)
(257,185)
Expenditures for dry docking
(4,623)
(3,316)
(7,939)
 
Year Ended December 31, 2023
 
LNG
Segment
$
NGL
Segment
$
Total
$
Voyage revenues
563,514
163,277
726,791
Voyage expenses
(6,715)
(14,725)
(21,440)
Vessel operating expenses
(175,382)
(57,278)
(232,660)
Time-charter hire expenses
—
(8,777)
(8,777)
Depreciation and amortization
(110,477)
(35,251)
(145,728)
General and administrative expenses(i)
(24,111)
(6,800)
(30,911)
Gain (write-down) and gain (loss) on sales of vessels (note 18)
35,807
(7,816)
27,991
Income from vessel operations
282,636
32,630
315,266
Equity income (note 7)
120,021
28,985
149,006
Investment in and advances to equity-accounted joint ventures, net
1,151,581
160,158
1,311,739
Expenditures for vessels and equipment, including advances on newbuilding contracts
(102,809)
(87)
(102,896)
Expenditures for dry docking
(26,633)
(1,287)
(27,920)
F-17
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
(i) Includes direct general and administrative expenses and indirect general and administrative expenses (allocated to each segment based on estimated
use of corporate resources).
A reconciliation of total segment assets to consolidated total assets presented in the Company's consolidated balance sheets is as follows:
December 31,
2025
$
December 31,
2024
$
Total assets of the LNG segment
4,157,470
4,378,066
Total assets of the NGL segment
857,258
846,929
Unallocated:
Cash and cash equivalents
122,906
153,726
Consolidated total assets
5,137,634
5,378,721
5. Chartered-in Vessels
       
December 31,
2025
$
December 31,
2024
$
Total obligations related to finance leases
1,802,526
1,727,553
Less current portion
(228,985)
(129,418)
Long-term obligations related to finance leases
1,573,541
1,598,135
As at December 31, 2025, the Company was a party to finance leases on 10 LNG carriers and 10 NGL carriers (December 31, 2024 - nine LNG
carriers and 10 NGL carriers). These 10 LNG carriers and 10 NGL carriers were sold by the Company to third parties (or Lessors) and leased back
under 5.5 to 15-year bareboat charter contracts ending in 2026 through to 2035. At inception of these leases, the weighted-average interest rate
implicit in these leases was 6.0% as at December 31, 2025 and 2024. The bareboat charter contracts are presented as obligations related to
finance leases on the Company's consolidated balance sheets.
As at December 31, 2025, the Company consolidated four of the 20 Lessors for financial reporting purposes as VIEs (December 31, 2024 – four of
the 19 Lessors). The Company understands that these vessels and lease operations are the only assets and operations of the Lessors. The
Company operates the vessels during the lease term and, as a result, is considered to be, under GAAP, the Lessor's primary beneficiary. As at
December 31, 2025, the sale and leaseback of 16 vessels (December 31, 2024 – 15 vessels) were accounted for as failed sales. The Company is
not considered to hold a variable interest in these buyer Lessor entities and thus, does not consolidate these entities.
As at December 31, 2025 and 2024, the liabilities of the four Lessors considered as VIEs were loans and were non-recourse to the Company. The
amounts funded to the four Lessors in order to purchase the vessels materially match the funding to be paid by the Company's subsidiaries under
the sale-leaseback transactions. As a result, the amounts due by the Company's subsidiaries to the four Lessors considered as VIEs have been
included in obligations related to finance leases as representing the Lessors' loans.
As at December 31, 2025, the obligations of the Company's applicable subsidiaries under the bareboat charter contracts for the 10 LNG carriers
and 10 NGL carriers (December 31, 2024 - nine LNG carriers and 10 NGL carriers) were guaranteed by the Company. The guarantee agreements
require the Company to maintain minimum levels of tangible net worth and aggregate liquidity, and not to exceed a maximum amount of leverage,
for certain of its finance leases. As at December 31, 2025 , the Company was in compliance with all covenants in respect of the bareboat charters it
guarantees.
As at December 31, 2025, the remaining commitments related to the financial liabilities of these 10 LNG carriers and 10 NGL carriers, including the
amounts to be paid to repurchase the vessels pursuant to the applicable finance leases, approximated $2.2 billion, including imputed interest of
$421.3 million repayable through 2035, as indicated below:
Year
Commitments as at
December 31, 2025
2026
$328,539
2027
$396,275
2028
$366,637
2029
$210,732
2030
$295,617
Thereafter
$626,013
F-18
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
During the year ended December 31, 2025, the Company entered into a new financing arrangement for the Marvel Swan LNG carrier whereby it
sold the vessel to a Lessor in January 2025 for $213.0 million and chartered the vessel back for a period of 13 years under a bareboat charter
contract. The quarterly charter-hire payments to be made by the Company consist of a fixed amount plus variable amounts based on the Secured
Overnight Finance Rate (or SOFR) plus a margin. The Company has an option to repurchase the vessel in July 2032 for $145.7 million.
During August 2025 and October 2025, the Company entered into new financing arrangements for the Seapeak Shearwater, the Seapeak Osprey,
the Seapeak Kinabalu, the Seapeak Atlas, and the Seapeak Kittiwake LNG carrier newbuildings, which are scheduled for deliveries throughout
2027 (see Note 14a). Under these new financing arrangements, the vessels will be sold to a Lessor upon their deliveries for approximately
$235.0 million per vessel, subject to conditions of closing. Each of the vessels will be chartered back for a minimum period of 10 years under a
bareboat charter contract. The quarterly charter-hire payments to be made by the Company consist of a fixed amount plus variable amounts based
on SOFR plus a margin. The Company has an option to repurchase the vessels at the end of the lease terms for $129.3 million per vessel.
In February 2026, the Company acquired the Seapeak Creole LNG carrier from its Lessor for $100.0 million, resulting in the termination of the
related finance lease (see Note 19d).
During the year ended December 31, 2024, the Company exercised repurchase options to acquire from Lessors eight of its NGL carriers, the Ineos
Marlin , the Ineos Inspiration, the Ineos Independence, the Ineos Intuition, the Ineos Invention, the Ineos Insight, the Ineos Ingenuity and the Ineos
Intrepid, and one of its LNG carriers, the Seapeak Oak, for a total cost of $422.2 million .
As a result of these vessel repurchases in 2024, the Company recognized gains totaling $6.3 million on the extinguishment of the original financing
arrangements relating to the vessels. These gains are included in other (expense) income for the year ended December 31, 2024 in the Company's
consolidated statement of income (loss). Immediately following the repurchases, the Company entered into new financing arrangements whereby it
sold the vessels to Lessors for a total of $629.7 million and chartered the vessels back for 5.5 to 8-year periods under bareboat charter contracts.
The quarterly charter hire payments to be made by the Company consist of a fixed amount plus variable amounts based on SOFR plus a margin.
The Company has options to repurchase the vessels at the end of the lease terms for a total cost of $283.5 million.
During the year ended December 31, 2023, the Company exercised repurchase options to acquire two of its NGL carriers, the Ineos Innovation and
the Ineos Dolphin, and one of its LNG carriers, the Myrina, for a total cost of $218.3 million. As a result of these repurchases in 2023, the Company
recognized gains totaling $5.1 million on the extinguishment of the original financing arrangements relating to the vessels. These gains are included
in other (expense) income for the year ended December 31, 2023 in the Company's consolidated statement of income (loss). Immediately following
the repurchases, the Company entered into new financing arrangements whereby it sold the vessels to Lessors for a total of $327.0 million and
chartered the vessels back for 8 to 12-year periods under bareboat charter contracts. The quarterly charter hire payments to be made by the
Company consist of a fixed amount plus variable amounts based on SOFR plus a margin. The Company has options to repurchase the vessels at
the end of the lease terms for a total cost of $107.8 million .
Certain bareboat charter agreements require that the Company maintain ratios of vessel values to the relevant outstanding underlying loan
balances. As at December 31, 2025, the Company had five bareboat charter agreements, under which the aggregate outstanding loan balance was
$139.9 million, that each requires the Company to maintain minimum vessel-value-to-outstanding-loan obligation balance ratios of 110%, if the
vessels are employed under approved charters at such time, or 140%, if the vessels are not employed under approved charters at such time. As at
December 31, 2025, the vessel-value-to-outstanding-loan obligation balance ratios were 171%, 168%, 163%, 164% and 139% under approved
charters. The vessel values used in calculating these ratios are the appraised values provided by third parties.
6. Revenue
The Company’s primary source of revenue is chartering its vessels to customers. The Company utilizes two primary forms of contracts, consisting
of time-charter contracts and voyage charter contracts. The Company also generates revenue from the management and operation of vessels
owned by equity-accounted joint ventures as well as providing corporate management services to such entities.
Time Charters
Pursuant to a time-charter contract, the Company charters a vessel to a customer for a fixed period of time, generally one year or more. The
performance obligations of a time-charter contract, which include the lease of the vessel to the charterer as well as the operation of the vessel, are
satisfied as services are rendered over the duration of such contract, as measured using the time that has elapsed from commencement of
performance. In addition, any expenses unique to a particular voyage, including any fuel expenses, port fees, cargo loading and unloading
expenses, canal tolls, agency fees and commissions, are the responsibility of the customer, as long as the vessel is not off-hire. Hire is based on a
fixed daily hire amount and is typically invoiced monthly in advance for time-charter contracts. However, certain sources of variability exist, including
penalties, such as those that relate to periods the vessels are off-hire and where minimum speed and performance metrics are not met. In addition,
certain time-charter contracts contain provisions allowing the Company to be compensated for increases in the Company's costs during the term of
the charter. Such provisions may be in the form of annual hire rate adjustments for changes in inflation indices or interest rates or in the form of cost
reimbursements for vessel operating expenditures or dry-docking expenditures. Finally, in a small number of charters, the Company may earn a
profit share consideration, which occurs when actual spot rates earned by the vessel exceed certain thresholds for a period of time. The Company
does not engage in any specific tactics to minimize residual value risk.
F-19
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
As at December 31, 2025, a substantial majority of the Company’s consolidated vessels operated under time-charter contracts with the Company’s
customers. Such contracts are scheduled to expire between 2026 and 2046. Certain of these contracts result in situations whereby the customer
will pay consideration up front for performance to be provided at a later date. The time-charter contracts for many of the Company's LNG carriers
have options that permit the charterer to extend the contract for periods up to a total extension between one and 10 years. In addition, each of the
Company's time-charter contracts are subject to certain termination and purchase provisions. As at December 31, 2025, the Company had $29.1
million of advanced payments recognized as contract liabilities (December 31, 2024 – $37.1 million) which are expected to be recognized as
voyage revenues and are included in unearned revenue and other long-term liabilities on the Company's consolidated balance sheets. The
Company recognized $37.1 million and $43.6 million of revenue for the years ended December 31, 2025 and 2024, respectively, that was
recognized as a contract liability at the beginning of those years.
Voyage Charters
Voyage charters are charters for a specific voyage that are usually priced on a current or “spot” market rate. The performance obligations of a
voyage charter contract, which typically include the lease of the vessel to the charterer as well as the operation of the vessel, are satisfied as
services are rendered over the duration of the voyage, as measured using the time that has elapsed from commencement of performance. In
addition, any expenses that are unique to a particular voyage, including any fuel expenses, port fees, cargo loading and unloading expenses, canal
tolls, agency fees and commissions, are the responsibility of the vessel owner. The Company’s voyage charters will normally contain a lease;
however, judgment is necessary to determine this based upon the decision-making rights of the charterer under the contract. Consideration for such
contracts is generally fixed, although certain sources of variability exist - for example, delays caused by the charterer result in additional
consideration. Payment for the voyage is not due until the voyage is completed. The duration of a single voyage is typically less than three months.
The Company does not engage in any specific tactics to minimize residual value risk due to the short-term nature of the contracts.
Management Fees and Other Income
The Company also generates revenue from the management and operation of vessels and the Bahrain LNG import terminal owned by the
Company's equity-accounted joint ventures, as well as providing corporate management services to certain of these entities. Such services may
include the arrangement of third-party goods and services for the vessel’s owner. The performance obligations within these contracts typically
consist of crewing, technical management, insurance and, at times, commercial management. The performance obligations are satisfied
concurrently and consecutively rendered over the duration of the management contract, as measured using the time that has elapsed from
commencement of performance. Consideration for such contracts generally consists of a fixed monthly management fee, plus the reimbursement
without markup of crewing costs for the vessels being managed. The monthly management fee and reimbursement of crewing costs are typically
invoiced and paid on a monthly basis.
Revenue Table
The following tables contain the Company's revenue for the years ended December 31, 2025, 2024 and 2023, by contract type and by segment.
Year Ended December 31, 2025
Year Ended December 31, 2024
Year Ended December 31, 2023
LNG
Segment
$
NGL
Segment
$
Total
$
LNG
Segment
$
NGL
Segment
$
Total
$
LNG
Segment
$
NGL
Segment
$
Total
$
Time charters
421,178
114,490
535,668
465,542
130,570
596,112
474,180
140,307
614,487
Voyage charters
—
—
—
—
13,560
13,560
—
22,970
22,970
Management fees and other
  income
101,290
—
101,290
101,072
—
101,072
89,334
—
89,334
522,468
114,490
636,958
566,614
144,130
710,744
563,514
163,277
726,791
The following table contains the Company’s total revenue for the years ended December 31, 2025, 2024 and 2023, by contracts or components of
contracts accounted for as leases and those not accounted for as leases:
Year Ended
December 31,
2025
$
Year Ended
December 31,
2024
$
Year Ended
December 31,
2023
$
Lease revenue
Lease revenue from lease payments of operating leases
433,287
504,691
536,072
Interest income on lease receivables
60,613
62,664
61,752
Variable lease payments – cost reimbursements(i)
5,411
4,902
5,365
499,311
572,257
603,189
Non-lease revenue
Non-lease revenue – related to direct financing and sales-type leases
36,357
37,415
34,268
Management fees and other income
101,290
101,072
89,334
137,647
138,487
123,602
Total
636,958
710,744
726,791
F-20
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
(i) Reimbursements for vessel operating expenditures and dry-docking expenditures received from the Company's customers relating to such costs
incurred by the Company to operate the vessel for the customer pursuant to charter contracts accounted for as operating leases.
Net Investments in Direct Financing and Sales-Type Leases
The two LNG carriers owned by Seapeak BLT Corporation (or the Tangguh Joint Venture), in which the Company has a 70% ownership interest
and which the Company consolidates, commenced their time-charter contracts with their charterers in 2009. Both time-charter contracts are
accounted for as direct financing leases with 20-year terms. In addition, the 21-year charter contract for the Seapeak Bahrain FSU commenced in
September 2018 and is accounted for as a direct financing lease. In February 2023, the Seapeak Creole commenced a 23-year time-charter
contract. The time charter contract is being accounted for as a sales-type lease. As a result, upon commencement of the time-charter contract the
carrying value of the vessel was derecognized and a net investment in sales-type lease was recognized based on its estimated fair value from third
party appraisals, resulting in a gain of $43.8 million recognized during the year ended December 31, 2023. The gain is included in (write-down) gain
and (loss) gain on sales of vessels in the Company's consolidated statement of income (loss) for the year ended December 31, 2023.
The following table lists the components of the net investments in direct financing and sales-type leases:
December 31,
2025
$
December 31,
2024
$
Total lease payments to be received
857,558
941,046
Estimated unguaranteed residual value of leased properties
335,841
335,841
Initial direct costs
103
135
Less unearned revenue
(538,084)
(598,696)
  Total net investments in direct financing and sales-type leases
655,418
678,326
Less credit loss provision
(52,900)
(32,000)
  Total net investments in direct financing and sales-type leases, net
602,518
646,326
Less current portion
(21,066)
(20,928)
Net investments in direct financing and sales-type leases, net
581,452
625,398
As at December 31, 2025, estimated lease payments to be received by the Company related to its direct financing and sales-type leases in each of
the next five succeeding fiscal years are approximately $82.3 million (2026), $83.6 million (2027), $78.9 million (2028), $50.6 million (2029), $44.7
million (2030) and an aggregate of $517.5 million thereafter. Two leases are expected to end in 2028, one lease is scheduled to end in 2039 and the
remaining lease is scheduled to end in 2046.
Operating Leases
As at December 31, 2025, scheduled future rentals to be received by the Company in each of the next five years for the lease and non-lease
elements related to charters that were accounted for as operating leases are approximately $388.1 million (2026), $228.6 million (2027), $176.7
million (2028), $149.3 million (2029), and $96.3 million (2030). Scheduled future rentals on operating lease contracts do not include rentals from
vessels in the Company's equity-accounted joint ventures, rentals from unexercised option periods of contracts that existed on December 31, 2025,
variable or contingent rentals, or rentals from contracts which were entered into or commenced after December 31, 2025. Therefore, the scheduled
future rentals on operating leases should not be construed to reflect total charter hire revenues for any of these five years.
The carrying amount of the Company's vessels which are employed on these charter contracts as at December 31, 2025, was $2.5 billion
(December 31, 2024 – $2.7 billion). The cost and accumulated depreciation of these vessels employed on these charter contracts as at
December 31, 2025 were $3.0 billion (December 31, 2024 – $3.1 billion) and $514.3 million (December 31, 2024 – $454.4 million), respectively.
F-21
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
7. Equity-Accounted Joint Ventures
a) A summary of the Company's investments in and advances to equity-accounted joint ventures are as follows:
 
As at December 31, 2025
As at December 31,
Name
Ownership
Percentage
# of
Delivered
Vessels
LNG
Terminal
Newbuildings
on order (viii)
2025
$
2024
$
Angola Joint Venture (i)
33%
4
—
—
84,306
85,961
Bahrain LNG Joint Venture (ii)
30%
—
1
—
77,951
87,973
Exmar LPG Joint Venture (iii)
50%
18
—
14
214,977
187,860
MALT Joint Venture (iv)
52%
6
—
—
322,794
314,332
Pan Union LNG Joint Venture (v)
20%-30%
4
—
—
87,197
87,777
RasGas III Joint Venture (vi)
40%
4
—
—
101,057
117,995
Yamal LNG Joint Venture (vii)
50%
6
—
—
472,472
466,472
Other
50%
—
—
—
8
8
42
1
14
1,360,762
1,348,378
Less credit loss provision
(2,900)
(1,800)
Investments in and advances to
  equity-accounted joint ventures, net
1,357,862
1,346,578
(i) Angola Joint Venture
As at December 31, 2025 and 2024, the Company has a 33% ownership interest in an LNG-related joint venture with NYK (33%) and Mitsui & Co., Ltd.
(34%) (or the Angola Joint Venture). The Angola Joint Venture owns four 160,400-cubic meter LNG carriers.
(ii) Bahrain LNG Joint Venture
In December 2015, the Company (30%) entered into a joint venture agreement with the Bahrain Petroleum Company (30%), Gulf Investment
Corporation (24%) and Samsung C&T Corporation (16%) to form the Bahrain LNG Joint Venture, for the development of an LNG receiving and
regasification terminal in Bahrain. The LNG terminal includes an offshore LNG receiving jetty and breakwater, an adjacent regasification platform,
subsea gas pipelines from the platform to shore, an onshore gas receiving facility, and an onshore nitrogen production facility with a total LNG terminal
capacity of 800 million standard cubic feet per day and is owned and operated under a 20-year customer contract. In addition, the Company has
supplied an FSU in connection with this terminal commencing in September 2018 through a 21-year time-charter contract with the Bahrain LNG Joint
Venture.
As at December 31, 2025 and 2024, the Company had advanced $73.4 million to the Bahrain LNG Joint Venture. These advances bear interest at
6.0%. For the years ended December 31, 2025, 2024 and 2023, the interest earned on these loans amounted to $6.2 million , $5.8 million, and $5.5
million, respectively, and is included in interest income in the Company’s consolidated statements of income (loss). As at December 31, 2025 and 2024,
the interest receivable on these advances was $32.6 million and $26.4 million, respectively. These amounts are included in the table above.
(iii) Exmar LPG Joint Venture
As at December 31, 2025 and 2024, the Company has a 50% ownership interest in an LPG-related joint venture with Exmar (or the Exmar LPG Joint
Venture). The Company has guaranteed its 50% share of secured loan facilities in the Exmar LPG Joint Venture for which the aggregate principal
amount of the secured loan facilities as at December 31, 2025 was $164.7 million (December 31, 2024 – $190.7 million). As a result, the Company has
recorded a guarantee liability. The carrying value of the guarantee liability as at December 31, 2025 was $1.1 million (December 31, 2024 – $0.7 million)
and is included as part of other long-term liabilities in the Company’s consolidated balance sheets.
On initial acquisition, the basis difference between the Company's investment and the carrying value of the Exmar LPG Joint Venture's net assets was
substantially attributed to the value of the vessels and charter agreements of the Exmar LPG Joint Venture and goodwill in accordance with the finalized
purchase price allocation. As at December 31, 2025, the unamortized amount of the basis difference was $6.4 million (December 31, 2024 – $8.4
million).
(iv) MALT Joint Venture
As at December 31, 2025 and 2024, the Company has a 52% ownership interest in an LNG-related joint venture with Marubeni Corporation (or the
MALT Joint Venture). Since control of the MALT Joint Venture is shared jointly between Marubeni and the Company, the Company accounts for its
investment in the MALT Joint Venture using the equity method. The Company has guaranteed its 52% share of certain of the MALT Joint Venture's
secured loan facilities and an interest rate swap, for which the aggregate of the principal amount of the secured loan facilities and fair value of the
interest rate swap as at December 31, 2025 was $69.6 million (December 31, 2024 – $82.6 million). As a result, the Company has recorded a
guarantee liability. The carrying value of the guarantee liability as at December 31, 2025 was $0.2 million (December 31, 2024 – $0.3 million) and is
included as part of other long-term liabilities in the Company’s consolidated balance sheets.
The Company recognized an impairment of its investment in the MALT Joint Venture in 2022. As a result of the impairment, the Company's
proportionate share of the carrying value of the MALT Joint Venture's net assets exceeded the Company's carrying value of its investment in the MALT
Joint Venture. The basis difference resulting from this impairment was attributed to vessels of the MALT Joint Venture and is being amortized to
earnings over the remaining lives of the vessels. At December 31, 2025, the unamortized amount of this basis difference was $67.5 million
(December 31, 2024 - $71.2 million).
F-22
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
(v) Pan Union LNG Joint Venture
As at December 31, 2025 and 2024, the Company has a 30% ownership interest in two LNG carriers, the Pan Asia and the Pan Americas, and a 20%
ownership interest in two LNG carriers, the Pan Europe and the Pan Africa, through its Pan Union LNG Joint Venture.
On initial acquisition, the basis difference between the Company's investment and the carrying value of the Pan Union LNG Joint Venture's net assets
was substantially attributed to ship construction support agreements and the time-charter contracts. At December 31, 2025, the unamortized amount of
the basis difference was $7.6 million (December 31, 2024 – $8.0 million).
(vi) RasGas III Joint Venture
As at December 31, 2025 and 2024, the Company has a 40% ownership interest in the RasGas III Joint Venture, and the remaining 60% is held by
Qatar Gas Transport Company Ltd.
(vii) Yamal LNG Joint Venture
As at December 31, 2025 and 2024, the Company has a 50% ownership interest in the Yamal LNG Joint Venture, which has six icebreaker LNG
carriers that carry out international transportation of LNG for a project located on the Yamal Peninsula in Northern Russia.
The Company has guaranteed its 50% share of a secured loan facility and interest rate swaps in the Yamal LNG Joint Venture for which the aggregate
of the principal amount of the loan facility and fair value of the interest rate swaps as at December 31, 2025 was $534.0 million (December 31, 2024 –
$578.7 million). As a result, the Company has recorded a guarantee liability. The carrying value of the guarantee liability as at December 31, 2025 was
$0.3 million (December 31, 2024 – $0.3 million) and is included as part of other long-term liabilities in the Company’s consolidated balance sheets.
(viii) Includes six NGL carriers that are scheduled to be in-chartered beginning in 2026.
b) The Angola Joint Venture, the Bahrain LNG Joint Venture, the RasGas III Joint Venture, and the Yamal LNG Joint Venture are considered
VIEs; however, the Company is not the primary beneficiary and therefore, the Company has not consolidated these entities. The Company’s
exposure to loss as a result of its investments in the Angola Joint Venture, the Bahrain LNG Joint Venture, the RasGas III Joint Venture, and
the Yamal LNG Joint Venture is the aggregate amounts it has invested in and advanced to these joint ventures, which are $84.3 million, $78.0
million, $101.1 million and $472.5 million, respectively, as at December 31, 2025. In addition, the Company provides an owner's guarantee in
respect of the charters for the Angola Joint Venture, the RasGas III Joint Venture, and the Yamal LNG Joint Venture; and guarantees the credit
facilities and interest rate swaps of the Yamal LNG Joint Venture as described above.
c) The following tables present aggregated summarized financial information reflecting a 100% ownership interest in the Company’s equity
method investments and excluding the impact from purchase price adjustments arising from the acquisition of the Exmar LPG Joint Venture
and the Pan Union LNG Joint Venture and the basis differences caused by an other-than-temporary impairment of the Company's investment
of the MALT Joint Venture recognized in 2022. The results include the Angola Joint Venture, the Bahrain LNG Joint Venture, the Exmar LPG
Joint Venture, the MALT Joint Venture, the Pan Union LNG Joint Venture, the RasGas III Joint Venture and the Yamal LNG Joint Venture.
 
December 31,
2025
$
December 31,
2024
$
Cash and restricted cash – current
405,065
508,119
Other assets – current
273,980
262,791
Vessels and equipment, including vessels related to finance leases, operating lease right-of-use assets
and advances on newbuilding contracts
2,680,213
2,514,549
Net investments in direct financing and sales-type leases – non-current
3,668,223
3,899,674
Other assets – non-current
310,998
350,647
Current portion of long-term debt, obligations related to finance leases, operating lease liabilities and
advances from joint venture partners
1,164,946
673,714
Other liabilities – current
242,484
211,451
Long-term debt, obligations related to finance leases, and operating lease liabilities
3,086,535
3,776,498
Other liabilities – non-current
71,469
71,205
 
Year Ended
December 31,
2025
$
Year Ended
December 31,
2024
$
Year Ended
December 31,
2023
$
Voyage revenues
1,005,484
1,016,277
1,041,655
Income from vessel operations
496,194
536,649
604,979
Realized and unrealized (loss) gain on non-designated derivative instruments:
Bahrain LNG Joint Venture
(8,316)
27,718
5,080
Other equity-accounted joint ventures
(2,704)
4,491
302
Net income
164,645
246,978
323,562
F-23
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
d) As described in Note 7a, the Company guarantees its proportionate share of certain loan facilities and obligations on interest rate swaps for
certain of its equity-accounted joint ventures. As at December 31, 2025, all of the Company's equity-accounted joint ventures were in
compliance with all covenants relating to these loan facilities that the Company guarantees.
8. Intangible Assets and Goodwill
As at December 31, 2025 and 2024, intangible assets of the Company's LNG segment consisted of acquired time-charter contracts with a
weighted-average amortization period of 25.0 years and 20.7 years, respectively, from the date of acquisition. As at December 31, 2025 and 2024,
intangible assets of the Company's NGL segment consisted of acquired time-charter contracts with a weighted-average amortization period of 4.7
years from the date of acquisition. The carrying amount of the Company's intangible assets as follows:
 
December 31, 2025
$
December 31, 2024
$
LNG
Segment
$
NGL
Segment
$
Total
$
LNG
Segment
$
NGL
Segment
$
Total
$
Gross carrying amount
36,506
24,810
61,316
179,813
24,810
204,623
Accumulated amortization
(31,395)
(16,421)
(47,816)
(173,242)
(10,947)
(184,189)
Net carrying amount
5,111
8,389
13,500
6,571
13,863
20,434
For the years ended December 31, 2025, 2024 and 2023, amortization expense associated with intangible assets was $6.9 million, $10.0 million
and $11.6 million, respectively. Amortization expense associated with intangible assets in each of the next five succeeding fiscal years is expected
to be approximately $6.9 million (2026), $3.4 million (2027), $2.1 million (2028), $1.1 million ( 2029) and nil (2030).
The Company's carrying amount of goodwill as at December 31, 2025 and 2024 is as follows:     
 
December 31,
2025
$
December 31,
2024
$
LNG segment
31,921
31,921
NGL segment
5,387
5,387
Total
37,308
37,308
The Company conducts an impairment review annually or more frequently if facts and circumstances suggest goodwill may be impaired. No
impairment charge was recorded for the years ended December 31, 2025, 2024 and 2023.
9. Accrued Liabilities and Other
December 31,
2025
$
December 31,
2024
$
Interest including interest rate swaps
21,157
20,138
Voyage and vessel expenses
24,056
25,072
Payroll and benefits
23,117
20,051
Current portion of in-process revenue contracts
5,696
5,715
Other general expenses
2,804
3,171
Income and other tax payable
1,780
1,278
Distributions payable on preferred units
6,279
6,279
Emissions allowance liabilities (note 14f )
41,937
18,356
Total
126,826
100,060
F-24
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
10. Long-Term Debt
December 31,
2025
$
December 31,
2024
$
U.S. Dollar-denominated Revolving Credit Facility due from 2026 to 2027
135,000
165,000
U.S. Dollar-denominated Term Loans and Bonds due from 2026 to 2030
664,849
724,874
Norwegian Krone-denominated Bonds due in 2026
99,142
175,646
    Total principal
898,991
1,065,520
Unamortized discount and debt issuance costs
(6,936)
(5,981)
    Total debt
892,055
1,059,539
Less current portion
(296,188)
(177,093)
    Long-term debt
595,867
882,446
As at December 31, 2025 and 2024, the Company had one revolving credit facility available, which provided for borrowings of up to $350.0 million.
As at December 31, 2025, $215.0 million (December 31, 2024 – $185.0 million) of the credit facility was undrawn. Interest payments are based on
SOFR plus a margin of 1.45%. The borrowing capacity of the revolving credit facility is scheduled to be reduced by $48.8 million in June 2026 and
the revolving credit facility is scheduled to mature in June 2027 . The revolving credit facility is unsecured and may be used by the Company for
general corporate purposes.
As at December 31, 2025, the Company had seven U.S. Dollar-denominated term loans and bonds outstanding, which totaled $664.8 million in
aggregate principal amount (December 31, 2024 – six U.S. Dollar-denominated term loans and bonds outstanding, which totaled $724.9 million).
Interest payments on these term loans are based on SOFR plus an additional amount consisting of a margin and a credit adjustment spread, where
such additional amount ranged from 2.00% to 3.45%, and interest payments on the bonds are fixed and range from 4.11% to 4.41%. Five of the
combined term loans and bonds require quarterly interest and principal payments and five have balloon or bullet repayments due at maturity. The
term loans and bonds are collateralized by first-priority mortgages on the 13 Company vessels to which the loans and bonds relate, together with
certain other related security. In addition, as at December 31, 2025, all of the outstanding term loans were guaranteed by either the Company or the
ship-owning entities within Teekay Nakilat Corporation (or the RasGas II Joint Venture), in which the Company has a 70% ownership interest.
As at December 31, 2025, the Company had Norwegian Krone (or NOK) 1.0 billion of senior unsecured bonds (December 31, 2024 – NOK 2.0
billion) in the Norwegian bond market that mature in November 2026. As at December 31, 2025, the total amount of the bonds, which are listed on
the Oslo Stock Exchange, was $99.1 million (December 31, 2024 – $175.6 million). The interest payments on the bonds are based on the
Norwegian Interbank Offered Rate (or NIBOR ) plus a margin of 4.90%. The Company entered into cross currency rate swaps, to swap all interest
and principal payments of the bonds into U.S. Dollars, with the interest payments fixed at 6.37% and the transfer of principal fixed at $117.0 million
upon maturity in exchange for NOK 1.0 billion (see Note 13).
The weighted-average interest rates for the Company’s long-term debt outstanding excluding the effect of related interest rate swaps as at
December 31, 2025 and December 31, 2024 were 6.23% and 7.06%, respectively. The Company uses swaps to economically hedge certain of its
floating-rate debt (see Note 13). The weighted-average interest rates including the effect of related interest rate swaps were 5.24% and 5.65% as at
December 31, 2025 and December 31, 2024 , respectively.
Non-U.S.-denominated debt is revalued at the end of each period using the then-prevailing U.S. Dollar exchange rate. Due primarily to the
revaluation of the Company’s NOK-denominated bonds and euro-denominated cash, and the change in the valuation of the Company’s cross
currency swaps, the Company incurred foreign exchange losses of $(6.2) million, $(1.4) million, and $(5.4) million for the years ended
December 31, 2025, 2024 and 2023, respectively.
The aggregate annual long-term debt principal repayments required under the Company's revolving credit facility, loans and bonds subsequent to
December 31, 2025, are $297.1 million (2026), $377.7 million (2027), $54.7 million (2028), $45.5 million (2029), and $124.0 million (2030).
Certain loan agreements require that (a) the Company maintain minimum levels of tangible net worth and aggregate liquidity, (b) the Company
maintain certain ratios of vessel values related to the relevant outstanding loan principal balance, (c) the Company not exceed a maximum amount
of leverage, and (d) certain of the Company’s subsidiaries maintain restricted cash deposits. As at December 31, 2025, the Company had three
credit facilities with an aggregate outstanding loan balance of $289.1 million that require it to maintain minimum vessel-value-to-outstanding-loan-
principal-balance ratios of 110%, 145%, and 120%, which as at December 31, 2025 were 207% , 197%, and 199% , respectively. The vessel values
used in calculating these ratios are the appraised values provided by third parties, where available, or prepared by the Company based on second-
hand sale and purchase market data. Since vessel values can be volatile, the Company’s estimates of market value may not be indicative of either
the current or future prices that could be obtained if the Company sold any of the vessels. The Company’s ship-owning subsidiaries may not,
among other things, pay dividends or distributions if the Company's subsidiaries are in default under their term loans and, in addition, one of the
term loans in the RasGas II Joint Venture requires it to satisfy a minimum vessel value to outstanding loan principal balance ratio to pay dividends.
As at December 31, 2025, the Company was in compliance with all covenants relating to the Company’s credit facilities and other long-term debt.
F-25
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
11. Income Tax (Expense) Recovery
Net income (loss) before income tax (expense) recovery includes the following components:
Year Ended
December 31,
2025
$
Domestic - Republic of the Marshall Islands
141,388
Foreign
(112,281)
Net income (loss) before income tax (expense) recovery
29,107
The components of income tax (expense) recovery are as follows:
 
Year Ended
December 31,
2025
$
Year Ended
December 31,
2024
$
Year Ended
December 31,
2023
$
Current
(4,098)
(1,255)
(3,683)
Deferred
982
3,741
(6,528)
Income tax (expense) recovery
(3,116)
2,486
(10,211)
The Company is not subject to taxes on income, capital gains or profits in the Republic of the Marshall Islands, the Company's jurisdiction of
domicile, under current domestic law and therefore all of the Company's income tax (expense) recovery is generated from foreign jurisdictions.
Included in the Company's current income tax (expense) recovery are provisions for uncertain tax positions relating to freight taxes. The Company
does not presently anticipate that its provisions for these uncertain tax positions will significantly increase in the next 12 months; however, this is
dependent on the jurisdictions in which vessel trading activity occurs. The Company reviews its freight tax obligations on a regular basis and may
update its assessment of its tax positions based on available information at that time. Such information may include additional legal advice as to the
applicability of freight taxes in relevant jurisdictions. Freight tax regulations are subject to change and interpretation; therefore, the amounts
recorded by the Company may change accordingly.
F-26
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
In accordance with ASU 2023-09, the following table presents a reconciliation between the amount of reported income tax (expense) recovery and
the amount computed by multiplying the net income before income tax (expense) recovery by the applicable statutory income tax rate of the
Republic of the Marshall Islands, the Company's jurisdiction of domicile, for the year ended December 31, 2025.
Year Ended
December 31,
2025
$
Year Ended
December 31,
2025
%
Net income before income tax (expense) recovery
29,107
100.0%
Amount computed using statutory rate of corporate tax:
—
—%
Foreign tax effects
United Kingdom
Effects of foreign tax rates different from statutory tax rates
3,941
13.5%
Changes in valuation allowances
(7,087)
(24.3)%
Other
(140)
(0.5)%
Luxembourg
Effects of foreign tax rates different from statutory tax rates
14,445
49.6%
Changes in valuation allowances (i)
(47,627)
(163.6)%
Change in tax rates enacted in the current period
(3,460)
(11.9)%
Adjustments to current and deferred taxes of prior years (i)
40,401
138.8%
Non-taxable income (non-deductible expenses)
(3,759)
(12.9)%
Spain
Effects of foreign tax rates different from statutory tax rates
309
1.1%
Changes in valuation allowances (i)
(67,022)
(230.2)%
Change in measurement of deferred tax assets (i)
64,335
221.0%
Differences in current and deferred tax rates in current year
2,779
9.5%
Other
(401)
—%
France
Effects of foreign tax rates different from statutory tax rates
(1,124)
(3.9)%
Adjustments to current and deferred taxes of prior years
(1,442)
(5.0)%
Changes in unrecognized tax benefits and other
2,736
9.4%
Income tax (expense) recovery
(3,116)
(10.7)%
(i) During the year ended December 31, 2025, Spanish subsidiaries of the Company disposed of two vessels that had been eligible for a preferential tax
regime in Spain. As a result, the Spanish subsidiaries will be subject to the regular corporate tax regime as of January 1, 2026. To reflect the change in the
applicable tax regime, the deferred tax assets related to tax attributes carried forward in Spain were remeasured at the higher corporate income tax rate.
Additionally, the Company recognized the benefit of tax losses carried forward in Luxembourg related to the impairment of investments in wholly-owned
subsidiaries. In both cases, the increase in the value of the deferred tax assets were offset by a corresponding increase in the valuation allowance. 
Prior to the adoption of ASU 2023-09, in the reconciliation between the applicable statutory rate and the effective tax rate in the financial
statements, a consolidated weighted-average tax rate was used according to the source of earnings or losses by country and the applicable tax
rates relating to each jurisdiction. The weighted-average statutory tax rate was determined based on the aggregate effective tax rates of all
jurisdictions and adjusted for 1) the net income (loss) of the entities within the group that is subject to zero tax in the jurisdiction and 2) the shipping
net income (loss) that is not subject to taxation in the jurisdiction where business operations are carried on.
F-27
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
A reconciliation between the weighted-average rate and the effective tax rate in the consolidated financial statements prior to the adoption of ASU
2023-09 is as follows:
 
Year Ended
December 31,
2024
$
Year Ended
December 31,
2023
$
Net (loss) income before income tax recovery (expense)
(98,307)
327,927
Income not subject to taxes
(42,563)
(314,742)
Net (loss) income subject to taxes
(140,870)
13,185
At applicable statutory tax rates
Amount computed using the standard rate of corporate tax
(1,664)
(590)
Adjustments to valuation allowance and uncertain tax positions
(13,909)
14,399
Permanent and currency differences
18,280
(23,900)
Change in tax rates
(221)
(120)
Tax recovery (expense)
2,486
(10,211)
The significant components of the Company’s net deferred tax assets (liabilities) were as follows:
 
December 31,
2025
$
December 31,
2024
$
Derivative instruments
(111)
(1,064)
Taxation loss carryforwards and disallowed finance costs
181,343
59,405
Vessels and equipment
10,369
6,972
Other items
745
363
192,346
65,676
Valuation allowance
(192,283)
(66,570)
Net deferred tax assets (liabilities)
63
(894)
 
December 31,
2025
$
December 31,
2024
$
Deferred income tax assets included in other assets
286
261
Deferred income tax liabilities included in other long-term liabilities
(223)
(1,155)
Net deferred tax assets (liabilities)
63
(894)
The Company had tax losses and estimated disallowed finance costs in Spain of 199.0 million Euros or approximately $233.8 million
(December 31, 2024 – 110.3 million Euros or approximately $114.2 million) and 13.7 million Euros or approximately $15.4 million ( December 31,
2024 – 14.8 million Euros or approximately $15.4 million), respectively, at December 31, 2025 of which the tax losses and the disallowed finance
costs are available indefinitely for offset against future taxable income in Spain. In addition, the Company had estimated tax losses and disallowed
finance costs in Luxembourg of 339.6 million Euros or approximately $399.0 million (December 31, 2024 – 217.5 million Euros or approximately
$225.2 million) and 35.4 million Euros or approximately $41.6 million (December 31, 2024 - 24.3 million Euros or approximately $28.5 million),
respectively, at December 31, 2025 that are available for offset against future taxable income in Luxembourg. The tax losses in Luxembourg are
either available indefinitely for losses arising prior to 2017, or for 17 years for losses arising subsequent to 2016 and the disallowed finance costs
are available indefinitely.
The Company recognizes interest and penalties related to uncertain tax positions in income tax (expense) recovery. The tax years 2010 through
2025 currently remain open to examination by the major tax jurisdictions to which the Company is subject.
F-28
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
12. Related Party Transactions
a) The following table and related footnotes provide information about certain of the Company's related party transactions for the periods
indicated:
Year Ended
December 31,
2025
$
Year Ended
December 31,
2024
$
Year Ended
December 31,
2023
$
Voyage revenues (i)(ii)
130,559
132,305
119,098
Equity income (iii)
2,417
2,423
2,417
(i) In September 2018, the Company’s FSU, the Seapeak Bahrain, commenced its 21-year charter contract with the Bahrain LNG Joint Venture. Voyage
revenues from the charter of the Seapeak Bahrain to the Bahrain LNG Joint Venture for the year ended December 31, 2025 amounted to $29.3 million
($31.2 million during 2024 and $29.8 million during 2023). In addition, the Company has an operation and maintenance contract with the Bahrain LNG
Joint Venture relating to the LNG regasification terminal in Bahrain. Fees recognized in relation to the operation and maintenance contract from the
Bahrain LNG Joint Venture for the year ended December 31, 2025 were $17.2 million ($20.8 million during 2024 and $10.5 million during 2023) and are
included in voyage revenues in the Company's consolidated statements of income (loss).
(ii) The Company provides ship management and corporate services to certain of its equity-accounted joint ventures that own and operate LNG carriers on
long-term charters pursuant to management agreements. In addition, the Company was reimbursed for costs incurred by the Company for its seafarers
operating these LNG carriers. During the year ended December 31, 2025, the Company earned management fees and cost reimbursements pursuant
to these management agreements of $84.1 million ($80.3 million during 2024 and $78.8 million during 2023), which amount is included in voyage
revenues in the Company's consolidated statements of income (loss).
(iii) During each of the years ended December 31, 2025, 2024 and 2023, the Company charged fees of $2.4 million to the Yamal LNG Joint Venture relating
to the successful bid process for the construction and chartering of six ARC7 LNG carriers. The fees are reflected in equity income in the Company’s
consolidated statements of income (loss).
(b) As at December 31, 2025 and 2024, non-interest-bearing amounts due from affiliates totaled $24.1 million and $19.7 million, respectively, and
non-interest-bearing amounts due to affiliates totaled $0.8 million and $6.7 million, respectively. These amounts due to/from affiliates are
unsecured and have no fixed repayment terms.
(c) On December 19, 2022, the Company received an equity contribution of $129.3 million from Stonepeak Limestone Holdings L.P. (or
Stonepeak) as partial payment for common units issued on March 8, 2023. In February 2023, the Company received an equity contribution of
$86.2 million from Stonepeak in connection with funding the first installment payments for two of the five 174,000-cubic meter M-type,
Electronically Controlled, Gas Admission propulsion LNG carriers the Company ordered in November 2022. On March 8, 2023, the Company
issued 11,383,543 common units to Stonepeak based on total equity contributions received in December 2022 and February 2023 of $215.5
million (see Note 16).
(d) For other transactions with the Company's equity-accounted joint ventures not disclosed above, please refer to Note 7.
13. Derivative Instruments and Hedging Activities
The Company uses derivative instruments in accordance with its overall risk management policy.
Foreign Exchange Risk
From time to time, the Company economically hedges portions of its forecasted expenditures denominated in foreign currencies and portions of its
foreign currency cash balances with foreign currency forward contracts. As at December 31, 2025, the Company was committed to the following
foreign currency forward contracts:
Contract
Amount
in Foreign
Currency
Average
Contract Rate(i)
Fair Value /
Carrying Amount of
Asset (Liability)
$
Expected Maturity of
Notional Amounts
Currency
2026
$
2027
$
Economic hedges of forecasted expenditures
British Pound Sterling
6,500
0.7569
165
7,913
674
Canadian Dollar
9,700
1.3820
92
6,575
444
257
14,488
1,118
Economic hedges of foreign currency cash balances
Euro
60,148
0.8498
(47)
70,777
—
(i) Average contractual exchange rate represents the contracted amount of foreign currency one U.S. Dollar will buy.
F-29
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
The Company entered into cross currency swaps concurrently with the issuance of its NOK-denominated senior unsecured bonds (see Note 10),
and pursuant to these swaps, the Company receives the principal amount in NOK on maturity dates of the swaps in exchange for payments of a
fixed U.S. Dollar amount. In addition, the cross currency swaps exchange a receipt of floating interest in NOK based on NIBOR plus a margin for a
payment of U.S. Dollar fixed interest. The purpose of the cross currency swaps is to economically hedge the foreign currency exposure on the
payment of interest and principal of the Company’s NOK-denominated bonds due in November 2026, and to economically hedge the interest rate
exposure. The following table reflects information relating to the cross currency swaps as at December 31, 2025:
Floating Rate Receivable
 
Principal Amount
NOK
Principal Amount
$
Reference Rate
Margin
Fixed Rate
Payable
Fair Value /
Carrying Amount of
Asset (Liability)
$
Weighted-
Average
Remaining
Term (Years)
1,000,000
117,000
NIBOR
4.90%
6.37%
(15,853)
0.9
Interest Rate Risk
The Company enters into interest rate swaps which exchange a receipt of floating interest for a payment of fixed interest to reduce the Company’s
exposure to interest rate variability on certain of its outstanding floating-rate debt.
As at December 31, 2025, the Company was committed to the following interest rate swap agreements:
Interest
Rate
Index
Principal
Amount
$
Fair Value /
Carrying Amount of
Asset (Liability)
$
Weighted-
Average
Remaining
Term
(Years)
Fixed
Interest
Rate (i)
U.S. Dollar-denominated interest rate swaps (ii)
SOFR
614,187
12,699
2.2
1.7%
U.S. Dollar-denominated interest rate swaps (ii)(iii)
SOFR
254,486
16,623
2.9
3.3%
U.S. Dollar-denominated interest rate swaps (iv)(v)(vi)
SOFR
64,635
24,764
0.3
3.0%
54,086
(i) Excludes an additional amount consisting of the margins and the credit adjustment spreads the Company pays on its floating-rate term loans, which, as
at December 31, 2025, ranged from 2.00% to 3.45%.
(ii) Principal amount reduces quarterly.
(iii) These interest rate swaps are subject to mandatory early termination in 2027 and 2029, whereby the swaps will be settled based on their fair value at
that time.
(iv) Principal amount reduces monthly.
(v) Forward-starting interest rate swaps with effective start dates ranging from February 2026 to June 2026.
(vi) These interest rate swaps are subject to mandatory early termination in 2026 whereby the swaps will be settled based on their fair value at that time
unless otherwise extended (see Note 19e).
As at December 31, 2025, the Company had multiple interest rate swaps, cross currency swaps and foreign currency forward contracts with the
same counterparty that are subject to the same master agreement. Each of these master agreements provides for the net settlement of all swaps
subject to that master agreement through a single payment in the event of default or termination of any one swap. The fair value of these derivative
instruments is presented on a gross basis in the Company’s consolidated balance sheets. As at December 31, 2025, these derivative instruments
constituted an aggregate fair value asset of $54.5 million (December 31, 2024 – $88.0 million) and an aggregate fair value liability of $2.9 million
(December 31, 2024 – $34.4 million). As at December 31, 2025, the Company had $3.8 million (December 31, 2024 – $19.5 million) of cash on
deposit as security for swap liabilities under certain master agreements. The deposit is presented in restricted cash – current and long-term on the
Company’s consolidated balance sheets.
Credit Risk
The Company is exposed to credit loss in the event of non-performance by the counterparties to its derivative instruments. In order to minimize
counterparty risk, the Company only enters into derivative transactions with counterparties that are rated A- or better by Standard & Poor’s or A3 or
better by Moody’s at the time of the transactions. In addition, to the extent practical, derivative instruments are entered into with different
counterparties to reduce concentration risk.
F-30
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
The following table presents the classification and fair value amounts of derivative instruments (none of which are designated as cash flow hedges),
segregated by type of contract, on the Company’s consolidated balance sheets.
Accounts
receivable
$
Current
portion of
derivative
assets
$
Derivative
assets
$
Current
portion of
derivative
liabilities
$
Derivative
liabilities
$
As at December 31, 2025
Interest rate swap agreements
1,471
32,202
20,541
—
128
Foreign currency forward contracts
—
210
—
—
—
Cross currency swap agreements
192
—
—
16,045
—
1,663
32,412
20,541
16,045
128
As at December 31, 2024
Interest rate swap agreements
2,070
35,042
50,913
—
—
Foreign currency forward contracts
—
—
—
527
—
Cross currency swap agreements
295
642
—
21,756
25,281
2,365
35,684
50,913
22,283
25,281
Realized and unrealized gains (losses) relating to non-designated interest rate swap agreements and foreign currency forward contracts are
recognized in earnings and reported in realized and unrealized (loss) gain on non-designated derivative instruments in the Company’s consolidated
statements of income (loss). The effect of the gain (loss) on these derivatives on the Company’s consolidated statements of income (loss) is as
follows:
 
Year Ended December 31,
 
2025
$
2024
$
2023
$
Realized
gains
(losses)
Unrealized
gains
(losses)
Total
Realized
gains
(losses)
Unrealized
gains
(losses)
Total
Realized
gains
(losses)
Unrealized
gains
(losses)
Total
Interest rate swap
agreements
18,690
(33,339)
(14,649)
23,387
32,963
56,350
20,227
3,403
23,630
Foreign currency
forward contracts
(599)
737
138
61
(748)
(687)
540
(177)
363
18,091
(32,602)
(14,511)
23,448
32,215
55,663
20,767
3,226
23,993
Realized and unrealized gains (losses) relating to cross currency swap agreements are recognized in earnings and reported in foreign currency
exchange loss in the Company’s consolidated statements of income (loss). The effect of the gain (loss) on these derivatives on the Company's
consolidated statements of income (loss) is as follows:
 
Year Ended December 31,
 
2025
$
2024
$
2023
$
Realized
gains
(losses)
Unrealized
gains
(losses)
Total
Realized
gains
(losses)
Unrealized
gains
(losses)
Total
Realized
gains
(losses)
Unrealized
gains
(losses)
Total
Cross currency swap
agreements
(8,835)
30,350
21,515
4,220
(26,869)
(22,649)
(19,463)
466
(18,997)
For the periods indicated, the following table presents the amounts of losses reclassified from accumulated other comprehensive income (or OCI ) to
interest expense for interest rate swaps previously dedesignated but for which the hedged forecasted transaction remains probable as cash flow
hedges (excluding such agreements in equity-accounted investments):
Year Ended December 31,
2025
$
2024
$
2023
$
Amount of loss reclassified from accumulated OCI to
interest expense
(598)
(761)
(1,242)
F-31
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
14. Commitments and Contingencies
a) During November 2022, the Company entered into contracts with Samsung Heavy Industries Co., Ltd. for the construction of five 174,000-
cubic meter M-type, Electronically Controlled, Gas Admission propulsion LNG carrier newbuildings that have an estimated total fully built-up
cost of $1.2 billion and are scheduled for delivery throughout 2027. As at December 31, 2025, expenditures incurred under these newbuilding
contracts totaled $301.6 million and the estimated remaining costs to be incurred are $243.5 million (2026) and $638.7 million (2027). The
Company intends to finance substantially all of the remaining estimated pre-delivery expenditures with borrowings under two U.S. Dollar-
denominated term loans maturing in 2027. In addition, the final construction installments due on delivery and the repayment of the two U.S.
Dollar-denominated term loans maturing in 2027 are expected to be financed with existing 10-year sale and leaseback financing
arrangements, where the LNG carrier newbuildings are expected to be sold to a third party upon their deliveries for approximately
$235.0 million per vessel (see Note 5).
During December 2025, the Company entered into contracts with Samsung Heavy Industries Co., Ltd. for the construction of two 174,000-
cubic meter low-pressure dual-fueled (X-DF) LNG carrier newbuildings that have an estimated total fully built-up cost of $511.6 million and are
scheduled for deliveries in the second half of 2028. As at December 31, 2025, the estimated costs to be incurred are $51.6 million (2026),
$153.6 million (2027) and $306.4 million (2028). The Company intends to finance the estimated costs with its existing liquidity and future
operating cash flow, as well as long-term debt financing to be arranged for the vessels prior to their scheduled deliveries. On February 2, 2026,
the Company made first installments payments of $48.9 million on the two LNG carrier newbuildings. On February 26, 2026, the Company
entered into a forward-starting, SOFR-based interest rate swap with an effective date in January 2027 to economically hedge a portion of the
Company's interest rate exposure on the expected debt financing on one of two newbuildings (see Note 19).
b) In March 2023, the Exmar LPG Joint Venture entered into contracts with Hyundai Mipo Dockyard Co., Ltd. (or HMD) for the construction of two
45,000-cubic meter ammonia capable dual-fueled LPG carriers with scheduled deliveries in 2026 . In March 2024, the Exmar LPG Joint
Venture entered into contracts with HMD for the construction of two additional 45,000-cubic meter ammonia capable dual-fueled LPG carriers
with scheduled deliveries in late-2026. The Company's proportionate share of the total fully built-up cost of these four vessels is approximately
$173.7 million. As at December 31, 2025, the Company's proportionate share of expenditures incurred under these newbuilding contracts
totaled $65.6 million and the Company's proportionate share of estimated remaining expenditures to be incurred are $108.1 million in 2026.
In January 2025, the Exmar LPG Joint Venture entered into contracts with Avance Gas Aries Ltd. for the assumption by the joint venture of
shipbuilding contracts for the construction of four 40,000-cubic meter dual-fueled LPG carriers, which are being constructed by Nantong CIMC
Sinopacific Offshore & Engineering Co., Ltd. (or Nantong CIMC.) In January 2026, one of these vessels, the Meribel, was delivered to the
Exmar LPG Joint Venture (see Note 19a). The remaining vessels are scheduled to be delivered throughout 2026. The Company's
proportionate share of the total fully built-up cost of the four vessels is approximately $151.5 million. As at December 31, 2025, the Company's
proportionate share of expenditures incurred under these newbuilding contracts totaled $93.1 million and the Company's proportionate share
of estimated remaining expenditures to be incurred are $58.4 million in 2026.
c) The Company has a 30% ownership interest in the Bahrain LNG Joint Venture which has an LNG receiving and regasification terminal in
Bahrain as described in Note 7a(ii). In October 2025, the Bahrain LNG Joint Venture agreed on the remaining final construction installment
payment and charges related to a dispute with the Bahrain LNG terminal contractor. The Bahrain LNG Joint Venture intends to finance the final
construction installment payment and charges through its existing undrawn financing, its existing liquidity, and potential cash contributions from
the shareholders (of which the Company’s proportionate share is estimated to be up to $5.9 million).
d) The Tangguh Joint Venture has submitted a Notice of Appeal against a tax audit related to its tax returns filed for the 2010 and subsequent
fiscal years. The UK taxing authority has challenged the deductibility of certain transactions not directly related to a long funding lease to which
the joint venture is a party and the Tangguh Joint Venture has recorded a provision of $1.6 million in 2017 (of which the Company's 70% share
is $1.1 million) in accrued liabilities and other in the Company’s consolidated balance sheets as at December 31, 2025 and 2024.
e) Tangguh Joint Venture Operating Leases
As at December 31, 2025, the Tangguh Joint Venture was a party to operating leases (or Head Leases) whereby it leases its two LNG carriers
(or the Tangguh LNG Carriers) to a third-party company. The Tangguh Joint Venture then leases back the LNG carriers from the same third-
party company (or the Subleases). Under the terms of these leases, the third-party company claims tax depreciation on the capital
expenditures it incurred to lease the vessels. As is typical in these leasing arrangements, tax and change of law risks are assumed and
indemnified by the Tangguh Joint Venture. Lease payments under the Subleases are based on certain tax and financial assumptions at the
commencement of the leases. If an assumption proves to be incorrect, the lease payments are increased or decreased under the Sublease to
maintain the agreed after-tax margin. The UK corporate income tax rate increased from 19% to 25%, effective April 1, 2023. Consequently, the
sublease payments the Company estimated that the Tangguh Joint Venture will pay in aggregate each year to lease back the vessels
increased from $23.9 million to $27.5 million. The Tangguh Joint Venture’s carrying amounts of this estimated tax indemnification obligation as
at December 31, 2025 and 2024 were $3.3 million and $3.8 million, respectively, and are included as part of other long-term liabilities in the
consolidated balance sheets of the Company. The tax indemnification is for the duration of the lease contract with the third party plus the years
it would take for the lease payments to be statute barred and ends in 2033. Although there is no maximum potential amount of future
payments, the Tangguh Joint Venture may terminate the lease arrangements on a voluntary basis at any time. If the lease arrangements
terminate, the Tangguh Joint Venture will be required to make termination payments to the third-party company sufficient to repay the third-
party company’s investment in the vessels and to compensate it for the tax effect of the terminations, including recapture of any tax
depreciation. The Head Leases and the Subleases have 20-year terms and are classified as operating leases. The Head Leases and the
Subleases for the two Tangguh LNG Carriers are scheduled to terminate in November 2028 and March 2029, respectively.
F-32
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
As at December 31, 2025 , the total estimated future minimum rental payments to be received and paid by the Tangguh Joint Venture related to
the lease contracts are as follows:
Year
Head Lease
Receipts (i)
$
Sublease
Payments (i) (ii)
$
2026
21,242
27,462
2027
21,242
27,462
2028
22,280
28,800
2029
4,362
5,655
Total
69,126
89,379
(i) The Head Leases are fixed-rate operating leases while the Subleases have a variable-rate component. As at December 31, 2025, the Company had
received $441.2 million of aggregate Head Lease receipts (December 31, 2024 –  $420.0 million) and had paid $415.2 million of aggregate Sublease
payments (December 31, 2024 – $387.6 million). The portion of the Head Lease receipts that has not been recognized into earnings is deferred and
amortized on a straight-line basis over the lease terms and, as at December 31, 2025, $3.7 million (December 31, 2024 – $3.7 million) and $3.3 million
(December 31, 2024 – $7.0 million) of Head Leases receipts had been deferred and included in unearned revenue and other long-term liabilities,
respectively, in the Company’s consolidated balance sheets.
(ii) The amount of payments related to the Subleases are updated annually to reflect any changes in the lease payments due to changes in tax law.
f) Effective January 1, 2024, emissions emitted by the maritime industry have been integrated in the EU ETS and are being phased in over a
three-year period. Emissions for voyages to or from Europe or within Europe included within the scope of EU ETS were based on 40% during
2024, 70% during 2025 and will be based on 100% in 2026. The Company is obligated to submit EUAs for all vessels under its operational
management on an annual basis prior to September 30th of each year. During 2025, the Company remitted 250,201 EUAs to the EU ETS,
which were related to emissions for voyages during the year ended December 31, 2024.
The following table presents the classification and carrying amounts of assets and liabilities related to EU ETS on the Company’s consolidated
balance sheets:
Amounts due from
affiliates
$
Other current
assets
$
Accrued liabilities
and other
$
As at December 31, 2025
Amounts due from equity-accounted investees (i)
25,116
—
—
Amounts due from charterers (i)
—
11,157
—
EUAs held by the Company (ii)
—
5,216
—
Obligation to submit EUAs (i)(ii)
—
—
41,937
25,116
16,373
41,937
As at December 31, 2024
Amounts due from equity-accounted investees (i)
11,524
—
—
Amounts due from charterers (i)
—
6,404
—
EUAs held by the Company
—
70
—
Obligation to submit EUAs (i)
—
—
18,356
11,524
6,474
18,356
(i) The amounts were measured using the period end EUA spot price
(ii) Certain charterers transferred to the Company EUAs, which are related to emissions for voyages during the year ended December 31, 2025. The
value of these EUAs were measured using the EUA spot price on receipt date of the EUAs.
g) Management is required to assess whether the Company will have sufficient liquidity to continue as a going concern for the one-year period
following the issuance of its consolidated financial statements. The Company had a working capital deficit of $407.7 million as at
December 31, 2025. This working capital deficit includes $296.2 million related to scheduled maturities and repayments of long-term debt in
the 12 months following December 31, 2025. Based on the Company’s liquidity at the date these consolidated financial statements were
issued, the liquidity it expects to generate from operations over the following year, the cash distributions it expects to receive from its equity-
accounted joint ventures, and the proceeds it expects to receive related to the refinancing of one of its LNG carriers and the financing of
certain of its LNG carrier newbuildings, the Company estimates that it will have sufficient liquidity to continue as a going concern for at least
the one-year period following the issuance of these consolidated financial statements.
F-33
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
15. Supplemental Cash Flow Information
a) The following is a tabular reconciliation of the Company's cash, cash equivalents and restricted cash balances for the periods presented in the
Company's consolidated statements of cash flows:   
December 31,
2025
$
December 31,
2024
$
December 31,
2023
$
December 31,
2022
$
Cash and cash equivalents
122,906
153,726
168,409
215,738
Restricted cash – current
14,455
9,210
2,910
42,376
Restricted cash – long-term
7,793
25,032
13,075
7,832
Total
145,154
187,968
184,394
265,946
The Company maintains restricted cash deposits relating to certain term loans, collateral for derivatives (see Note 13), vessels held for sale,
obligations related to finance leases and amounts received from charterers to be used only for dry-docking expenditures and emergency
repairs.
b) The changes in operating assets and liabilities for years ended December 31, 2025, 2024 and 2023 are as follows:
December 31,
2025
$
December 31,
2024
$
December 31,
2023
$
Accounts receivable
(1,562)
2,211
19,402
Prepaid expenses and other current assets
(9,925)
1,080
6,467
Accounts payable
1,434
398
(2,229)
Accrued liabilities and other long-term liabilities
26,844
6,868
(5,653)
Unearned revenue and long-term unearned revenue
(10,349)
19,797
1,608
Amounts due to and from affiliates
(7,959)
4,885
(10,930)
Receipts from direct financing and sales-type leases
22,908
21,085
18,976
Expenditures for dry docking
(14,010)
(13,997)
(20,836)
Other operating assets and liabilities
(9,770)
(9,277)
(6,811)
Total
(2,389)
33,050
(6)
c) Cash interest paid (including realized losses on interest rate swaps) on long-term debt and obligations related to finance leases, net of
amounts capitalized, during the years ended December 31, 2025, 2024 and 2023 totaled $168.3 million, $175.0 million and $186.9 million ,
respectively.
d) During the years ended December 31, 2025, 2024 and 2023, foreign income taxes paid, net of tax refunds received, were $6.0 million, $1.7
million and $3.2 million, respectively. During the year ended December 31, 2025, foreign income taxes paid, net of tax refunds received, were
$4.1 million (United Kingdom), $1.4 million (France), and $0.5 million (other jurisdictions).
16. Total Capital
As at December 31, 2025, the Company's capital structure is comprised of three classes of Company units: common units, Series A Preferred Units
and Series B Preferred Units. All of the Company's outstanding common units are held by Stonepeak and its affiliates, and all of the Company's
outstanding Series A Preferred Units and Series B Preferred Units are held by the public.
In the event of a liquidation, all property and cash in excess of that required to discharge all liabilities and the liquidation amounts on the Series A
Preferred Units and Series B Preferred Units will be distributed to the common unitholder as adjusted to reflect any gain or loss upon the sale or
other disposition of the Company’s assets in liquidation in accordance with the Company's Limited Liability Company Agreement.
F-34
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
Preferred Unitholders' Rights
Significant rights of the Company’s preferred unitholders include the following:
a) Distributions on each Series A Preferred Unit shall accumulate at $0.5625 for each three-month period until the date the Company redeems
the Series A Preferred Units in full. Distributions on each Series B Preferred Unit shall accumulate at $0.53125 for each three-month period
until the earlier of i) the date the Company redeems the Series B Preferred Units in full and ii) October 15, 2027. After October 15, 2027,
distributions on each Series B Preferred Unit shall accumulate for each three-month period until the date the Company redeems the Series B
Preferred Units in full in accordance with the terms of the Company's Limited Liability Company Agreement based on an annual rate of three-
month LIBOR plus 6.241% as pro-rated for the applicable three-month period. As three-month LIBOR has been discontinued, in accordance
with the terms of the Limited Liability Company Agreement, the Company may, in its discretion, use a substitute or successor base rate that it
has determined is most comparable to three-month LIBOR as the base distribution rate described in the immediately preceding sentence. The
Company expects to utilize three-month SOFR in replacement of three-month LIBOR.
b) The Company has the right to redeem the Series A Preferred Units at any time and will have the right to redeem the Series B Preferred Units
on or after October 15, 2027, in whole or in part, for $25.00 per unit plus any accumulated and unpaid distributions.
c) The Series A Preferred Units have no voting rights, except in the event that six quarterly Series A distributions are in arrears, in which case the
Series A holders are entitled, voting as a class together with holders of other parity securities upon which like voting rights have been conferred
and are exercisable, to elect one member of the board of directors. The Series B Preferred Units have no voting rights, except in the event that
six quarterly Series B distributions are in arrears, in which case the Series B Holders are entitled, voting as a class together with holders of any
parity securities upon which like voting rights have been conferred and are exercisable, to elect one member of the board of directors. The size
of the board of directors shall be increased as needed to accommodate such change.
d) The Series A Preferred Units and Series B Preferred Units each rank senior to the Company’s common units.
e) In the event of liquidation of the Company, all property and all cash in excess of that required to discharge liabilities of the Company shall be
distributed, subject to the issuance of any equity securities having a priority to the Series A and B Preferred Units, first to the Series A and B
Preferred Unit holders until there has been distributed in respect of each Series A and B Preferred Unit then outstanding $25.00 plus any
accumulated and unpaid distributions. Any remaining amounts are distributed to the common unitholder.
Preferred and Common Unit Distributions
The distributions payable on the Series A and Series B Preferred Units for the years ended December 31, 2025, 2024 and 2023 were $25.1 million,
$25.1 million and $24.9 million , respectively.
During the year ended December 31, 2025, the Company declared and paid a cash distribution of $1.0005 (2024 – $2.5013 and 2023 – $0.5003)
per common unit, totaling $100.0 million (2024 – $250.0 million and 2023 - $50.0 million), to its sole common unitholder, Stonepeak.
Issuance of Common Units
In December 2022 and February 2023, the Company received equity contributions of $129.3 million and $86.2 million, respectively, from Stonepeak
in connection with funding the first installment payments for the five LNG carrier newbuildings the Company ordered in November 2022 (see Note
14a). On March 8, 2023, the Company issued 11,383,543 common units to Stonepeak based on the total contributions received of $215.5 million
(see Note 12c).
Preferred Unit Repurchases
In March 2022, the Company established a plan which authorized the repurchase of up to $30.0 million of its Series A and Series B Preferred Units.
The following table summarizes the preferred units repurchases for the years ended December 31, 2025, 2024 and 2023.
 
Year Ended December 31,
2025
2024
2023
#
$
#
$
#
$
Series A Preferred Units
—
—
—
—
29,395
700
Series B Preferred Units
—
—
—
—
131,081
3,272
Total
—
—
—
—
160,476
3,972
As at December 31, 2025, the remaining dollar value of Series A and Series B Preferred Units that may be repurchased under the plan was
$23.3 million.
17. Restructuring Charges
During the year ended December 31, 2025, the Company recognized restructuring charges of $21.9 million. The restructuring charges primarily
relate to severance costs resulting from the dismissal of the Company’s Spanish seafarers. The dismissal of the seafarers followed the Company’s
decision to restructure the operations of the four steam turbine LNG carriers, which comprise its Spanish fleet, due to the adverse market conditions
affecting steam turbine LNG carriers.
F-35
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
18. (Write-down) Gain and (Loss) Gain on Sales of Vessels
The following table provides information on the Company's (write-down) gain and (loss) gain on sales of vessels for the years presented in these
consolidated financial statements:
December 31, 2025
December 31, 2024
December 31, 2023
Segment
Asset Type
$
$
$
LNG (notes 6 and 18a)
LNG Carriers
(71,006)
(387,109)
35,807
NGL (note 18b)
Multi-gas Carriers
—
4,339
(7,816)
(Write-down) gain and (loss) gain on
sales of vessels
(71,006)
(382,770)
27,991
a) In February 2023, the Company sold the Seapeak Arctic LNG carrier for net proceeds of $14.9 million, resulting in a loss on sale of
$1.0 million, which is included in (write-down) gain and (loss) gain on sales of vessels for the year ended December 31, 2023 in the
Company's consolidated statement of income (loss).
In March 2023, the carrying value of the Seapeak Polar LNG carrier was written-down to its estimated fair value, based on the recent sale of a
similar vessel, as a result of changes in the Company's expectations of this vessel's future opportunities subsequent to the completion of its
time-charter contract in May 2023. The impairment charge of $7.5 million is included in (write-down) gain and (loss) gain on sales of vessels
for the year ended December 31, 2023 in the Company's consolidated statement of income (loss). In June 2023, the Seapeak Polar was sold
for net proceeds of $14.7 million, resulting in a gain on sale of $0.5 million, which is included in (write-down) gain and (loss) gain on sales of
vessels for the year ended December 31, 2023 in the Company's consolidated statement of income (loss).
During the year ended December 31, 2024, the carrying values of the Company’s seven steam turbine LNG carriers, the Seapeak Hispania,
the Seapeak Asia (formerly, the Seapeak Catalunya), the Seapeak Mars (formerly, the Seapeak Madrid), the Seapeak Galicia, the Al
Marrouna, the Al Areesh, and the Al Daayen, the oldest vessels in the Company’s LNG fleet, were written-down to their estimated fair values
as a result of downward revisions to the outlook for this class of older vessel based on a combination of an oversupply of this type of vessel
and reduced charterer interest due to their less efficient design, and an increased likelihood that the vessels would be sold. As such, the
Company reduced its forecast for future hire rate and its estimate of their useful lives from 35 to 25 years. The total impairment charge of
$387.1 million is included in (write-down) gain and (loss) gain on sales of vessels for the year ended December 31, 2024 in the Company's
consolidated statement of income (loss). The estimated fair value for the Seapeak Galicia, the Al Marrouna, the Al Areesh, and the Al Daayen,
were written down to their estimated fair values using a discounted cash flow approach with a discount rate of 7.98% based on the vessels
operating to age 25, which included the remaining duration of their existing long-term fixed-rate charter contracts. Of these four vessels, the
three Ras Gas II Joint Venture vessels (the Al Marrouna, the Al Areesh, and the Al Daayen) were assumed to be rechartered at a daily hire
rate of $33,800. The estimated fair value for the other three vessels, the Seapeak Hispania, the Seapeak Asia and the Seapeak Mars, were
written down during 2024 to their estimated fair values of $16.0 million per vessel based on the Company's knowledge of potential sale
transactions of steam vessels within the marketplace. In early 2025, to reduce the Company's operating costs, the Seapeak Hispania, the
Seapeak Asia and the Seapeak Mars, were placed in lay-up.
In September 2025, the carrying values of the three RasGas II Joint Venture vessels were further written-down to their estimated fair values.
The 20-year charters for these vessels are scheduled to expire from October 2026 to February 2027. Steam turbine LNG carriers are currently
facing acute market pressure amid weak demand and a record number of such vessels are currently inactive. The outlook for these vessels is
not expected to significantly improve by late-2026 and early-2027. Therefore, it is expected that the RasGas II Joint Venture vessels will be
sold, unless a suitable charter can be found prior to the expiration of their existing charters. The total impairment charge of $60.1 million is
included in (write-down) gain and (loss) gain on sales of vessels for the year ended December 31, 2025 in the Company's consolidated
statements of income (loss). The vessels were written down to their estimated fair values using a discounted cash flow approach based on the
vessels operating to a downward revised age of 20 years on their existing long-term fixed-rate charter contracts and subsequent sale at a price
which is based on recent transactions for LNG carriers of a similar age.
In December 2025, the Company sold the Seapeak Asia for net proceeds of $12.1 million, resulting in a loss on sale of $3.8 million, which is
included in (write-down) gain and (loss) gain on sales of vessels for the year ended December 31, 2025 in the Company's consolidated
statement of income (loss).
In December 2025, the Company recorded a further write-down on the Seapeak Hispania and the Seapeak Mars to their estimated net sales
price of $12.2 million each, based on the sale of the Seapeak Asia. The total write-down of $7.1 million is included in (write-down) gain and
(loss) gain on sales of vessels for the year ended December 31, 2025 in the Company's consolidated statement of income (loss). As at
December 31, 2025, the Seapeak Hispania and the Seapeak Mars are presented as held for sale in the Company's consolidated balance
sheet. In January 2026, the Seapeak Mars was sold for net proceeds of $12.1 million (see Note 19b). In January 2026, the Seapeak Hispania
was renamed the Seapeak Jupiter. In March 2026, the Seapeak Jupiter was sold for net proceeds of $14.9 million (see Note 19b).
b)In March 2023, the Company sold the Seapeak Unikum multi-gas carrier for net proceeds of $24.7 million, resulting in a gain on sale of
$0.2 million, which is included in (write-down) gain and (loss) gain on sales of vessels for the year ended December 31, 2023 in the
Company's consolidated statement of income (loss).
In April 2023, the Company sold the Seapeak Vision multi-gas carrier for net proceeds of $24.0 million, which approximated its net book value.
F-36
SEAPEAK LLC AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(all tabular amounts stated in thousands of U.S. Dollars, unless otherwise indicated)
In December 2023, the Company signed memorandum of agreements for the sales of the Seapeak Napa, the Seapeak Cathinka and the
Seapeak Camilla multi-gas carriers for total net proceeds of $22.3 million and recorded a write-down of $3.6 million based on the expected net
sales proceeds, which is included in (write-down) gain and (loss) gain on sales of vessels for the year ended December 31, 2023 in the
Company's consolidated statement of income (loss). In February 2024 , the Seapeak Napa was delivered to its buyer for net proceeds of
$10.4 million, resulting in a gain on sale of $0.5 million , which is included in (write-down) gain and (loss) gain on sales of vessels for the year
ended December 31, 2024 in the Company's consolidated statement of income (loss). In March 2024, the Seapeak Cathinka was delivered to
its buyer for net proceeds of $6.5 million, resulting in a gain on sale of $0.2 million, which is included in (write-down) gain and (loss) gain on
sales of vessels for the year ended December 31, 2024 in the Company's consolidated statement of income (loss). In April 2024, the Seapeak
Camilla was delivered to its buyer for net proceeds of $6.7 million, resulting in a gain on sale of $0.3 million, which is included in (write-down)
gain and (loss) gain on sales of vessels for the year ended December 31, 2024 in the Company's consolidated statement of income (loss).
In December 2023, the carrying value of the Seapeak Pan multi-gas carrier was written down to its estimated fair value as a result of changes
in the Company's expectations of the vessel's future opportunities. The estimated fair value was determined with reference to the selling price
from the recent sales of similar vessels, feedback from recent selling efforts relating to the vessel, the condition of one of the vessels which
was required to undergo a scheduled drydocking in the first quarter of 2024 and prevailing prices for the recycling of vessels. The impairment
charge of $4.5 million for the vessel is included in (write-down) gain and (loss) gain on sales of vessels for the year ended December 31, 2023
in the Company's consolidated statement of income (loss). In August 2024, the Company sold the Seapeak Pan for net proceeds of
$6.5 million, resulting in a gain on sale of $3.4 million which is included in (write-down) gain and (loss) gain on sales of vessels for the year
ended December 31, 2024 in the Company's consolidated statement of income (loss).
19. Subsequent Events
a) On January 8, 2026, the Company's 50%-owned Exmar LPG Joint Venture took delivery of the Meribel, the first of four 40,000-cubic meter
dual-fueled LPG carriers scheduled for deliveries to the joint venture by Nantong CIMC in 2026. The vessel concurrently commenced its one-
year charter contract with an international energy company.
b) On January 29, 2026, the Company sold its wholly-owned LNG carrier, the Seapeak Mars, for net proceeds of $12.1 million.
On March 16, 2026, the Company sold its wholly-owned LNG carrier, the Seapeak Jupiter, for net proceeds of $14.9 million.
c) On February 2, 2026, the Company made first installments totaling $48.9 million on the two LNG carrier newbuildings the Company ordered in
December 2025.
d) On February 24, 2026, the Company acquired the Seapeak Creole LNG carrier from its Lessor for $100.0 million, resulting in the termination of
the related finance lease.
e) On February 19, 2026, the Company entered into two interest rate swaps, whereby the Company will pay an amount based on a weighted-
average fixed interest rate of 3.15% and will receive an amount based on three-month term SOFR, both rates as applied to an agreed notional
principal amount. The aggregate notional principal amount of both interest rate swaps begins at $103.4 million upon their effective dates in
February 2026 and March 2026, increases to $373.5 million by October 2027 and declines every three months thereafter to $124.3 million
upon their maturity in August 2037 and September 2037, respectively. The interest rate swaps will economically hedge a portion of the
Company's interest rate exposure on the expected debt financing for the Seapeak Kinabalu and the Seapeak Atlas (see Note 14a). The
interest rate swaps mandatorily terminate in November 2027 and December 2027, respectively, at which time the interest rate swaps will be
settled based upon their fair value at that time, unless otherwise extended.
On February 26, 2026, the Company entered into an interest rate swap, whereby the Company will pay an amount based on a fixed interest
rate of 3.77% and will receive an amount based on three-month term SOFR, both rates as applied to an agreed notional principal amount. The
notional principal amount of the interest rate swap begins at $39.1 million upon its effective date in January 2027, increases to $195.4 million
by July 2028 and declines every three months thereafter to $69.4 million upon its maturity by July 2038. The interest rate swap will
economically hedge a portion of the Company's interest rate exposure on the expected debt financing for one of the two 174,000-cubic meter
low-pressure dual-fueled (X-DF) LNG carrier newbuildings (see Note 14a). The interest rate swap mandatorily terminates in July 2028, at
which time the interest rate swap will be settled based upon its fair value at that time, unless otherwise extended.