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                                                                    EXHIBIT 4.16



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                          TEEKAY SHIPPING CORPORATION,
                                   as Issuer,

              THE BANK OF NEW YORK TRUST COMPANY OF FLORIDA, N.A.,
                                   as Trustee,

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                          First Supplemental Indenture
                          Dated as of December 6, 2001

                                   ----------

               $100,000,000 8.875% Senior Notes due July 15, 2011



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         FIRST SUPPLEMENTAL INDENTURE dated as of December 6, 2001 between
Teekay Shipping Corporation, a corporation duly incorporated and existing under
the laws of the Republic of the Marshall Islands, as issuer (hereinafter called
the "Company"), having its principal operating office at 505 Burrard Street,
Suite 1400, Vancouver, British Columbia, Canada, V7X IM5, and The Bank of New
York Trust Company of Florida, N.A., a national banking association duly
organized and existing under the laws of the United States of America, as
Trustee (hereinafter called the "Trustee").

                             RECITALS OF THE COMPANY

         WHEREAS, the Company and the Trustee (formerly U.S. Trust Company of
Florida, N.A.) have entered into an indenture dated as of June 22, 2001, (the
"Original Indenture") in relation to the issuance of $250,000,000 aggregate
principal amount of the Company's 8.875% Senior Notes due July 15, 2011 (the
"Original Securities"), issued in the form of a registered global note (the
"Initial Global Security") registered in the name of Cede & Co., as nominee of
The Depository Trust Company and held by the Trustee, as custodian for the
Initial Global Security;

         WHEREAS, pursuant to Section 3.01 of the Original Indenture and
pursuant to the provisions of the Original Securities, the Company may, from
time to time, without notice to or the consent of the registered holders of the
Original Securities, create and issue additional Securities ranking pari passu
with the Original Securities in all respects so that such additional Securities
shall form a single series of Securities together with the Original Securities
and shall have the same terms as to status, redemption or otherwise as the
Original Securities;

         WHEREAS, the Company has duly authorized the creation of and issuance
of $100,000,000 aggregate principal amount of its 8.875% Senior Notes due July
15, 2011 (the "Initial Additional Securities") and a like amount of 8.875%
Exchange Senior Notes due July 15, 2011 (the "Exchange Additional Securities"
and, together with the Initial Additional Securities, the "Additional
Securities") issued in the form of a Restricted Global Additional Security, (as
defined herein) of substantially the tenor hereinafter set forth, and to provide
therefor the Company has duly authorized the execution and delivery of this
First Supplemental Indenture; and

         WHEREAS, all things necessary have been done to make the Additional
Securities, when executed by the Company and authenticated and delivered
hereunder and duly issued by the Company, the valid obligations of the Company,
and to make this First Supplemental Indenture a valid agreement of the Company,
each in accordance with their respective terms.

         NOW, THEREFORE, THIS FIRST SUPPLEMENTAL INDENTURE WITNESSETH:

         For and in consideration of the premises and the purchase of the
Additional Securities by the Holders thereof, it is mutually covenanted and
agreed, for the equal and proportionate benefit of all Holders of the Additional
Securities, as follows:


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                                  ARTICLE ONE
             DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

              SECTION 1.01.   DEFINITIONS.

              (a) For all purposes of this First Supplemental Indenture, except
         as otherwise expressly provided or unless the context otherwise
         requires:

                   (i) the terms defined in this Article have the meanings
              assigned to them in this Article and include the plural as well as
              the singular;

                   (ii) all other terms used herein which are defined in the
              Trust Indenture Act of 1939, as amended (the "Trust Indenture
              Act"), either directly or by reference therein, have the meanings
              assigned to them therein;

                   (iii) all accounting terms not otherwise defined herein have
              the meanings assigned to them in accordance with generally
              accepted accounting principles in the United States (whether or
              not such is indicated herein), and, except as otherwise herein
              expressly provided, the term "generally accepted accounting
              principles" with respect to any computation required or permitted
              hereunder shall mean such accounting principles as are generally
              accepted in the United States as consistently applied by the
              Company at the date of such computation;

                   (iv) unless the context otherwise requires, any reference to
              an "Article" or a "Section", or to an "Annex" or a "Schedule",
              refers to an Article or Section of, or to an Annex or a Schedule
              attached to, this First Supplemental Indenture, as the case may
              be;

                   (v) unless the context otherwise requires, any reference to a
              statute, rule or regulation refers to the same (including any
              successor statute, rule or regulation thereto) as it may be
              amended from time to time; and

                   (vi) the words "herein", "hereof" and "hereunder" and other
              words of similar import refer to this First Supplemental Indenture
              as a whole and not to any particular Article, Section or other
              subdivision.

              (b) Other terms are defined as follows:

         "Additional Security" and "Additional Securities" have the meaning set
forth in the third recital of this First Supplemental Indenture and more
particularly means any Additional Securities authenticated and delivered under
this First Supplemental Indenture. For all purposes of this First Supplemental
Indenture, the term "Additional Securities" shall include any Exchange
Additional Securities to be issued and exchanged for any Initial Additional
Securities in accordance with the Exchange Offer as provided for in the
Registration Rights Agreement and this First Supplemental Indenture and, for
purposes of this First Supplemental Indenture, all Initial Additional Securities
and Exchange Additional Securities, together with the Original Securities, shall
vote together as one series of Securities under the Indenture.



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         "Exchange Additional Securities" has the meaning stated in the third
recital of this First Supplemental Indenture and refers to any Exchange
Additional Securities containing terms identical in all material respects to the
Initial Additional Securities that are issued and exchanged for the Initial
Additional Securities in accordance with the Exchange Offer, as provided for in
the Registration Rights Agreement and this First Supplemental Indenture.

         "Exchange Offer" means the offer by the Company to the Holders of the
Initial Additional Securities to exchange all of the Initial Additional
Securities for Exchange Additional Securities, as provided for in the
Registration Rights Agreement.

         "Indenture" means the Original Indenture, as supplemented by this First
Supplemental Indenture.

         "Initial Additional Securities" has the meaning set forth in the third
recital of this First Supplemental Indenture.

         "Initial Global Security"" has the meaning set forth in the first
recital of this First Supplemental Indenture.

         "Original Indenture" has the meaning set forth in the first recital of
this First Supplemental Indenture.

         "Registration Rights Agreement" means the Exchange and Registration
Rights Agreement between the Company and the Initial Purchaser named therein
dated as of December 6, 2001 relating to the Additional Securities.

         "Regulation S" means Regulation S under the Securities Act.

         "Security" or "Securities" means the Original Securities and any
Exchange Securities issued under the Original Indenture together with the
Additional Securities.

         "First Supplemental Indenture" means this instrument as originally
executed (including all exhibits and schedules hereto) and as it may from time
to time be supplemented or amended by one or more indentures supplemental hereto
entered into pursuant to the applicable provisions hereof.

         SECTION 1.02.   TERMS DEFINED IN THE ORIGINAL INDENTURE.

         Terms and expressions defined in the Initial Global Security or the
Original Indenture shall have the same meaning when used in this First
Supplemental Indenture unless otherwise defined herein or unless the context
otherwise requires.

         SECTION 1.03.   PROVISIONS OF THE ORIGINAL INDENTURE.

         (a) The provisions of the Original Indenture shall apply to the
Additional Securities and any certificated Additional Securities in definitive
form issued in exchange therefor in the exact same manner as they apply to the
Original Securities and any certificated Original Securities in definitive form
issued in exchange therefor, respectively. Notwithstanding


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anything contained herein to the contrary, interest on the Initial Additional
Securities will accrue from the most recent date to which interest has been paid
or, if no interest has been paid, from June 22, 2001.

         (b) All references in the Original Indenture to "Securities" shall be
deemed to include the Original Securities, any Exchange Securities and the
Additional Securities, and any certificated Original Securities, Exchange
Securities or Additional Securities in definitive form issued in exchange
therefor, respectively.

         SECTION 1.04.   EFFECT OF FIRST SUPPLEMENTAL INDENTURE.

         (a) This First Supplemental Indenture is a supplemental agreement
within the meaning of Sections 3.01 and 9.01 of the Original Indenture, and the
Original Indenture shall be read together with this First Supplemental Indenture
and shall have the same effect over the Additional Securities, in the same
manner as if the provisions of the Original Indenture and this First
Supplemental Indenture were contained in the same instrument.

         (b) In all other respects, the Original Indenture is confirmed by the
parties as supplemented by the terms of this First Supplemental Indenture.

         SECTION 1.05.   EFFECT OF HEADINGS AND TABLE OF CONTENTS.

         The Article and Section headings herein are for convenience only and
shall not affect the construction hereof.

         SECTION 1.06.   SUCCESSORS AND ASSIGNS.

         All covenants and agreements in this First Supplemental Indenture by
the Company, the Trustee and the Holders shall bind their respective successors
and assigns, whether so expressed or not.

         SECTION 1.07.   SEVERABILITY CLAUSE.

         In case any provision in this First Supplemental Indenture or in the
Additional Securities shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.

         SECTION 1.08.   BENEFITS OF FIRST SUPPLEMENTAL INDENTURE.

         Nothing in this First Supplemental Indenture or in the Additional
Securities, express or implied, shall give to any Person (other than the parties
hereto and their successors and assigns hereunder, any Paying Agent and the
Holders) any benefit or any legal or equitable right, remedy or claim under this
First Supplemental Indenture.



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         SECTION 1.09.   GOVERNING LAW.

         THIS FIRST SUPPLEMENTAL INDENTURE AND THE ADDITIONAL SECURITIES SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK.

                                  ARTICLE TWO
                                 THE SECURITIES

              SECTION 2.01.   FORMS GENERALLY.

              (a) The Initial Additional Securities shall be known as "8.875%
         Senior Notes due July 15, 2011" and the Exchange Additional Securities
         shall be known as "8.875% Senior Exchange Notes due July 15, 2011", in
         each case, of the Company. The Additional Securities and the Trustee's
         certificate of authentication shall be in substantially the forms set
         forth in Article II of the Original Indenture, with such appropriate
         insertions, omissions, substitutions and other variations as are
         required or permitted by the Original Indenture, and may have such
         letters, numbers or other marks of identification and such legends or
         endorsements placed thereon as may be required to comply with the rules
         of any securities exchange or as may, consistently herewith, be
         determined by the officers executing such Additional Securities, as
         evidenced by their execution of the Additional Securities.

              (b) The definitive Additional Securities shall be printed,
         lithographed or engraved or produced by any combination of these
         methods on steel engraved borders or may be produced in any other
         manner, provided that such manner is permitted by the rules of any
         securities exchange on which the Securities may be listed, as evidenced
         by their execution of such Additional Securities.

              (c) Initial Additional Securities offered and sold in their
         original distribution in reliance on Rule 144A shall be issued
         initially in the form of one or more Global Securities in definitive,
         fully registered form without interest coupons, substantially in the
         form of Security set forth in Article II of the Original Indenture (the
         "Restricted Global Additional Security"), and shall be registered in
         the name of the United States Depositary or its nominee and deposited
         with the Trustee, at its Corporate Trust Office, as custodian for the
         United States Depositary, or such other office of the Trustee or its
         affiliate at which its corporate trust operations as custodian for the
         United States Depositary are conducted, duly executed by the Company
         and authenticated by the Trustee as hereinafter provided, for credit by
         the United States Depositary to the respective accounts of beneficial
         owners of the Securities represented thereby (or such other accounts as
         they may direct). The aggregate stated amount at Maturity of the
         Restricted Global Additional Security may from time to time be
         increased or decreased by adjustments made on the records of the
         Trustee, as custodian for the United States Depositary.

              (d) Initial Additional Securities offered and sold in reliance on
         Regulation S shall be issued in the form of one or more Global
         Securities (collectively, the "Regulation S Global Additional
         Security") in definitive, fully registered form without interest
         coupons, substantially in the form of Security set forth in Article II
         of the Original Indenture, with such applicable legends as are provided
         for therein. Such Global


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         Securities shall be registered in the name of the United States
         Depositary or its nominee and deposited with the Trustee, at its
         Corporate Trust Office, as custodian for the United States Depositary,
         or such other office of the Trustee or its affiliate at which its
         corporate trust operations as custodian for the United States
         Depositary are conducted, duly executed by the Company and
         authenticated by the Trustee as hereinafter provided, for credit to the
         respective accounts at the United States Depositary of the depositories
         for Morgan Guaranty Trust Company of New York, Brussels office, as
         operator of the Euroclear Clearance System ("Euroclear"), or for
         Clearstream Banking, societe anonyme ("Clearstream"), in turn for
         credit to the respective accounts of beneficial owners of the
         Securities represented thereby (or such other accounts as they may
         direct) in accordance with the rules thereof. The aggregate stated
         amount at Maturity of the Regulation S Additional Global Security may
         from time to time be increased or decreased by adjustments made on the
         records of the Trustee, as custodian for the United States Depositary.

              SECTION 2.02.   TITLE AND TERMS.

              (a) The Initial Additional Securities shall be known and
         designated as "8.875% Senior Notes due July 15, 2011" and the Exchange
         Additional Securities shall be known and designated as "8.875% Senior
         Exchange Notes due July 15, 2011". The Stated Maturity of the
         Additional Securities shall be July 15, 2011, and they shall bear
         interest at the rate of 8.875% per annum from June 22, 2001, or from
         the most recent Interest Payment Date to which interest has been paid
         or duly provided for, payable on January 15, 2002, and semi-annually
         thereafter on January 15 and July 15, in each year and at said Stated
         Maturity until the principal thereof is paid or duly provided for.

              (b) The Company and the Trustee acknowledge and agree that the
         Original Securities, the Additional Securities and any certificated
         Original Securities or Additional Securities in definitive form issued
         in exchange therefor, respectively, form a single series and have the
         same terms as to status or otherwise, and that Initial Additional
         Securities may not be exchanged for Original Securities. Exchange
         Additional Securities may be exchanged for Original Securities.

                  The Trustee shall (upon Company Order) authenticate and
deliver Additional Securities for original issue in an aggregate principal
amount of up to $100,000,000.

              SECTION 2.03.   EXCHANGE.

              (a) At the option of the Holder, and subject to the provisions of
         Article III of the Original Indenture, Additional Securities may be
         exchanged for other Additional Securities of any authorized
         denominations and of a like aggregate stated amount at Maturity, upon
         surrender of the Additional Securities to be exchanged at an office or
         agency of the Company designated pursuant to Section 10.02 of the
         Original Indenture for such purpose. Whenever any Additional Securities
         are so surrendered for exchange, and subject to the other provisions of
         Article III of the Original Indenture, the Company shall execute, and
         the Trustee shall authenticate and deliver, the Securities which the
         Holder making the exchange is entitled to receive.



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              (b) All Additional Securities issued upon any registration of
         transfer or exchange of Additional Securities shall be the valid
         obligations of the Company, evidencing the same debt, and (except for
         the differences between the Initial Additional Securities and
         Additional Exchange Securities provided for in this First Supplemental
         Indenture) entitled to the same benefits under this First Supplemental
         Indenture, as the Additional Securities which the Holder making the
         exchange is entitled to receive.


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         This First Supplemental Indenture may be signed in any number of
counterparts with the same effect as if the signatures to each counterpart were
upon a single instrument, and all such counterparts together shall be deemed an
original of this First Supplemental Indenture.

         IN WITNESS WHEREOF, the parties hereto have caused this First
Supplemental Indenture to be duly executed, and their respective corporate seals
to be hereunto affixed and attested, all as of the day and year first above
written.

                                        TEEKAY SHIPPING CORPORATION


                                        By: ____________________________________
                                            Name:
                                            Title:




THE BANK OF NEW YORK TRUST COMPANY
OF FLORIDA, N.A.,
    as Trustee

By: ____________________________________
    Name:
    Title: