Document:

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                                                                    Exhibit 10.9
                                    BPTIME3

                                TIME CHARTERPARTY

                   PRODUCED IN ASSOCIATION WITH THE BALTIC AND
                     INTERNATIONAL MARITIME COUNCIL (BIMCO)

                           1ST EDITION - FEBRUARY 2001

                             (C) BP SHIPPING LIMITED
                   REGISTERED IN ENGLAND AND WALES: NO. 140132
           REGISTERED OFFICE:- BREAKSPEAR PARK, BREAKSPEAR WAY, HEMEL
                           HEMPSTEAD, HERTS, HP2 4UL.

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                                    CONTENTS

<TABLE>
<S>                                                                                                     <C>
COMMERCIAL PROVISIONS....................................................................................4

1.       DELIVERY AND CHARTER PERIOD.....................................................................4

2.       CANCELLATION....................................................................................4

3.       REDELIVERY......................................................................................5

4.       NOTICES OF DELIVERY AND REDELIVERY..............................................................5

5.       BUNKERS ON DELIVERY AND REDELIVERY..............................................................5

6.       CARGOES.........................................................................................6

7.       TRADING LIMITS..................................................................................6

8.       HIRE............................................................................................6

OWNERS' RIGHTS AND OBLIGATIONS...........................................................................7

9.       OWNERS' OBLIGATIONS.............................................................................7

10.      MASTER AND CREW.................................................................................8

11.      BILLS OF LADING AND WAYBILLS....................................................................9

12.      DRUGS AND ALCOHOL POLICY........................................................................9

13.      DRY-DOCKING....................................................................................10

14.      LIEN...........................................................................................10

CHARTERERS' RIGHTS AND OBLIGATIONS......................................................................10

15.      CHARTERERS' OBLIGATIONS........................................................................10

16.      SPACE AVAILABLE TO CHARTERERS..................................................................11

17.      LOADING AND DISCHARGE / SHIP-TO-SHIP TRANSFERS.................................................11

18.      PERFORMANCE OF VESSEL - SPEED AND CONSUMPTION..................................................11

19.      OFF-HIRE.......................................................................................12

20.      LAYING UP......................................................................................13

21.      STORAGE........................................................................................13

22.      SUB-LET........................................................................................13

23.      SUPERNUMERARIES................................................................................13

24.      VESSEL/CARGO INSPECTIONS/BUNKER SURVEYS........................................................13

SPECIAL PROVISIONS......................................................................................14

25.      CLAUSE PARAMOUNT...............................................................................14

26.      SALVAGE........................................................................................14
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<TABLE>
<S>                                                                                                    <C>
27.      ICE............................................................................................15

28.      REQUISITION....................................................................................15

29.      OUTBREAK OF WAR................................................................................15

30.      WAR RISKS......................................................................................15

31.      GENERAL AVERAGE................................................................................17

32.      NEW JASON......................................................................................17

33.      BOTH-TO-BLAME COLLISION........................................................................18

34.      OIL POLLUTION PREVENTION.......................................................................18

35.      EXCEPTIONS.....................................................................................19

36.      LAW............................................................................................19
</TABLE>

                                                                         PAGE ii

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                                                  Codeword for this Charterparty
                                                                       "PBTIME3"

                                                               TIME CHARTERPARTY

                              Date ____ March 2005

                                    PREAMBLE

It is this day agreed between GRANADA SPIRIT L.L.C. of the Republic of the
Marshall Islands, with its registered office at Trust Company Complex, Ajeltake
Islands, Majuro, Marshall Islands, MH 96960 ("Owners") being owners/disponent
owners of the motor/steam tank vessel (delete as applicable) called GRANADA
SPIRIT ("Vessel") and TEEKAY CHARTERING LIMITED of the Republic of the Marshall
Islands with its place of business at TK House, Bayside Executive Park, West Bay
Street & Blake Road, P.O. Box AP-59212, Nassau, The Bahamas ("Charterers") that
the service for which provision is herein made shall be subject to the terms and
conditions of this Charter which comprises this PREAMBLE, PART 1 and PART 2,
together with the OCIMF Vessel Particulars Questionnaire current at the date
hereof and the BP Shipping Questionnaire (together referred to as the
"Questionnaire") as attached hereto.

Unless the context otherwise requires, words denoting the singular include the
plural and vice versa.

In the event of any conflict between the provisions of PART 1 and PART 2 of this
Charter, the previsions of PART I shall prevail.

In the event of any conflict between the provisions of PART 1 or PART 2 of this
Charter and any provisions in the Questionnaire, the provisions of PART 1 or
PART 2 of this Charter shall prevail.

                                                                          PAGE 1
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                                     PART 1

A.   Name of Vessel: GRANADA SPIRIT, call sign C6UA4, IMO NO. 8710326

B.   Charter Period: Beginning ___________, 2005 until the earliest of (a)
delivery to Teekay LNG Operating L.L.C. or its subsidiary of the newbuilding
Toledo Spirit, (b) December 31, 2005 or (c) the early termination of this
Charter by the purchase of the Vessel or the Owner in accordance with the
Purchase Agreement, dated the date hereof, between Teekay LNG Operating L.L.C.
and Teekay Shipping Corporation.

C.   Laydays/Cancelling: Delivery under this Charter shall be concurrent with
signing of this Charter in or around _______, 2005.

     Commencing:  0001 hours local time on _______ ("Commencement Date")
     Cancelling:  1600 hours local time on _______ ("Cancelling Date")

D.   Place of Delivery: Within Trading Limits, either at sea or a safe port.

E.   Vessel shall be delivered with the following cargo history: N/A

F.   Place of Redelivery: Within Trading Limits, either at sea or a safe port.

G.   Bunkers on Delivery and Redelivery: Beginning bunkers ROB for Charterers's
account and ending bunkers ROB for Charterers' account

H.   Rate of Hire: US$27,660 per day

I.   Owners' Payment Details: To be advised

     Bank:
     Address:
     Swift:
     Sort Code:
     Account No:
     In favour of:
     Reference:

J.   Bunker Specifications: As required

K.   Permitted Cargoes: Crude oil and/or other petroleum products

L.   Trading Limits: Worldwide within British IWL

M.   Additional Clauses:

     Termination of Charter due to Purchase Option Agreement: Charterers shall
     have the option to terminate the Charter at any time pursuant to the
     Purchase Option Agreement between Teekay Shipping Corporation and Teekay
     LNG Operating L.L.C. dated April __, 2005.

                                                                          PAGE 2
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                                     PART 2

COMMERCIAL PROVISIONS

1.   DELIVERY AND CHARTER PERIOD

     1.1  Owners agree to let and Charterers agree to hire the Vessel from the
          time of delivery for a Charter Period as set out in PART 1, Section B.
          The Vessel shall be placed at the disposal of Charterers at the Place
          of Delivery as set out in PART 1, Section D. The Vessel shall not be
          delivered to Charterers prior to the Commencement Date.

     1.2  Upon delivery the Vessel shall be tight, staunch, strong, in every way
          fitted for service, with cargo spaces, facilities and equipment ready
          to receive, carry and deliver cargo, and with a full complement of
          Master, officers and crew fully competent, certified and experienced
          to perform the services contracted for, and in all material respects
          meeting the description of the Vessel set out in the Questionnaire.
          Without prejudice to the aforesaid, upon delivery Owners, Master,
          officers, crew and all documents shall conform in all parts and in all
          material respects with the responses submitted in the Questionnaire.

2.   CANCELLATION

     2.1  If the Vessel is not ready in accordance with Clause 1 and at
          Charterers' disposal by the Cancelling Date (which term shall for the
          purposes of this Clause include any new Cancelling Date determined
          under this Clause 2) Charterers shall have the option of cancelling
          this Charter within forty-eight (48) hours after the Cancelling Date.

     2.2  Owners undertake to notify Charterers promptly if at any time Owners
          or the Master have reason to believe that the Vessel may not be
          delivered in accordance with Clause 1 by the Cancelling Date. Such
          notification is to be in writing and shall state the date and time
          that Owners expect the Vessel to be ready to be delivered.

     2.3  If at any time it appears to Charterers that the Vessel will not be
          delivered in accordance with Clause 1 by the Cancelling Date,
          Charterers may require Owners to state in writing the dart and time
          that they expect the Vessel to be ready to be delivered, such
          statement to be given within ninety-six (96) hours of Charterers'
          request.

     2.4  If the date and time notified by Owners pursuant to sub-clauses 2.2,
          2.3 or 4.1 falls after the Cancelling Date then Charterers shall have
          the option of cancelling this Charter within one hundred and twenty
          (120) hours of receipt of the said notice from Owners or within
          forty-eight (48) hours after the Cancelling Date, whichever is
          earlier.

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          If Charterers do not exercise their option to cancel this Charter then
          the new Cancelling Date for the purpose of this Clause 2 shall be
          twelve (12) hours after the date and time notified by Owners pursuant
          to sub-clauses 2.2 or 2.3, or such other date and time as may be
          mutually agreed.

     2.5  If Owners fail, or fail timeously, to respond in writing to Charterers
          when required to do so under sub-clause 2.3, Charterers shall have the
          option of cancelling this Charter within one hundred and twenty (120)
          hours after the period allowed for Owners' response under sub-clause
          2.3, or within forty-eight (48) hours after the Cancelling Date,
          whichever is earlier.

3.   REDELIVERY

     3.1  The Vessel shall be redelivered to Owners at the Place of Redelivery
          stipulated in PART 1, Section F on the expiry of the Charter Period,
          on completion of its final voyage on dropping last outward bound
          pilot, or as may otherwise be agreed.

     3.2  Notwithstanding the provisions of sub-clauses 1.1 and 3.1 hereof,
          should the Vessel at the expiry of the Charter Period be on a ballast
          voyage to the Place of Redelivery or on a laden voyage (which for the
          purposes of this Clause shall be deemed to have commenced at the end
          of the sea passage to the first loadport), then Charterers shall have
          the use of the Vessel at the same rate and conditions for such
          extended time as may be necessary for the completion of the voyage on
          which it is engaged and, where required, its ballast voyage to the
          Place of Redelivery.

4.   NOTICES OF DELIVERY AND REDELIVERY

     4.1  The below notices shall be given by Owners to Charterers in the case
          of delivery, and by Charterers to Owners in the case of redelivery:

          4.1.1 One calendar week prior to delivery / redelivery, notice shall
                be given specifying the anticipated date for delivery /
                redelivery.

5.   BUNKERS ON DELIVERY AND REDELIVERY

     5.1  The Vessel shall be delivered with about the quantity of fuels stated
          in PART 1, Section G and shall be redelivered with about the same
          quantity.

     5.2  Charterers shall accept and pay for all fuels on board at the time of
          delivery and Owners shall accept and pay for all fuels on board at
          redelivery (whether at the end of the Charter Period or upon
          termination of the Charter for other reasons), all at the price paid
          (net of all discounts).

                                                                          PAGE 4
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6.   CARGOES

     6.1  Charterers shall have the right to ship all lawful cargoes falling
          within the description set out in PART 1, Section K.

     6.2  Charterers shall not ship, nor permit to be shipped, any cargo
          dangerous to the Vessel.

7.   TRADING LIMITS

The Vessel shall be employed in lawful trades within Institute Warranty Limits
and within the Trading Limits set out in PART 1, Section L.

8.   HIRE

     8.1  Charters shall pay hire per day or pro rata for part of a day from the
          time the Vessel is delivered to Charters until its redelivery to
          Owners in the currency and at the rate sated in PART 1, Section H. All
          calculation of hire shall be by reference to Universal Time
          Co-ordinated (UTC).

     8.2  The first payment of hire shall be made on or about the date of
          delivery, paying the hire in advance up to, but not including, the
          first day of the succeeding month. All subsequent payments of hire
          shall be made monthly in advance on the first day of each calendar
          month to the account stipulated in PART 1, Section I in funds
          available to Owners on the due date. If, however, in a given month the
          due date is a non-banking day in the United States (if hire is to be
          paid in US Dollars) or in the country stated in PART 1, Section I,
          then the subject month's hire shall be paid on the next banking day.

     8.3  Hire for the month in which the anticipated date for redelivery falls
          shall be made up to and including the anticipated date of redelivery.
          Any necessary adjustments shall be made by payment by Owners to
          Charterers or by Charterers to Owners, as the case may be, within
          twenty-eight (28) days after redelivery.

     8.4  Where there is a failure to pay hire by the due date, Owners shall
          notify Charterers in writing of such failure. Within five (5) banking
          days of receipt of such notification Charterers shall pay the amount
          due, failing which Owners shall have the right to suspend the
          performance of any or all of their obligations under this Charter
          and/or to withdraw the Vessel. If Owners elect to suspend performance
          of the Charter in respect of a particular late payment, they may
          still, notwithstanding that suspension of performance, withdraw the
          Vessel from the Charter in respect of that late payment provided they
          give a further twenty-four (24) hours' notice in writing of their
          intention to withdraw. Under no circumstances shall the act of
          suspending performance be construed as a waiver by Owners of the right
          to withdraw in respect of the continuing failure to pay hire or any
          subsequent late payment of hire under this Charter.

                                                                          PAGE 5
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          Throughout any period of suspended performance under this Clause, the
          Vessel is to be and shall remain on hire. Charterers undertake to
          indemnify Owners in respect of any liabilities incurred by Owners
          under the bill of lading or any other contract of carriage as a
          consequence of Owners' proper suspension of and/or withdrawal from any
          or all of their obligations under this Charter.

     8.5  On production of supporting vouchers, Charters shall be entitled to
          deduct from hire any expenditure incurred on behalf of Owners which is
          for Owners' account under this Charter as well as any other costs and
          expenses due to Charterers which this Charter entitles them to deduct
          from hire. Charterers shall be entitled to a commission of 2.5% on
          expenditure settled on behalf of Owners.

     8.6  Charterers may, at any time during the three months prior to the end
          of the Charter Period set out in PART 1, Section B, deduct from hire
          any amount which they reasonably estimate will be due to them at the
          end of the Charter Period in respect of expenditure on behalf of
          Owners, bunkers on redelivery, anticipated performance claims and any
          other similar claims Charterers may have against Owners.

OWNERS' RIGHTS AND OBLIGATIONS

9.   OWNERS' OBLIGATIONS

     9.1  Without prejudice to Clause 1, Owners shall exercise due diligence to
          maintain the Vessel in, or restore the Vessel to, the condition
          required pursuant to Clause 1 throughout the Charter Period.

     9.2  Owners undertake that from the date of entering into this Charter the
          classification society, flag, ownership, management (whether technical
          or commercial) and P&I Insurers of the Vessel shall not change without
          Charterers' prior consent. Without prejudice to any other right that
          Charterers may have, a breach of this provision will entitle
          Charterers to terminate this Charter, whereupon Owners shall reimburse
          Charterers with any hire paid in advance and not earned. Should
          Charterers withhold consent under this Clause, then Owners may require
          Charterers to promptly identify to them an alternative acceptable to
          Charterers.

     9.3  Owners undertake that from the date of entering into this Charter the
          amount of Hull and Machinery insurance on the Vessel shall not change
          without Charterers' prior consent, which shall not be unreasonably
          withheld.

     9.4  Without prejudice to Clause 1, and provided always that Owners are
          granted a reasonable time to perform cleaning, Owners shall throughout
          the Charter Period ensure that the Vessel presents for loading with
          its tanks, pumps and

                                                                          PAGE 6
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          pipelines properly prepared to the satisfaction of any inspector
          appointed by or on behalf of Charterers and ready for loading the
          cargo specified by Charterers.

     9.5  Owners shall remain responsible for the navigation of the Vessel, acts
          of pilots, tug boats and crew, same as when trading for their own
          account. Owners undertake that throughout the period of this Charter
          they will, at their own expense, comply with the regulations in force
          from time to time so as to enable the Vessel to pass through the Suez
          and Panama Canals by day and by night without delay.

     9.6  Without limitation to the foregoing, Owners shall provide and pay for:

          9.6.1 provisions, wages (including overtime), discharging fees and all
                other expenses related to the Master, officers and crew; and

          9.6.2 cabin, deck, engine-room and other necessary stores, including
                domestic water; and

          9.6.3 radio traffic and other communication expenses; and

          9.6.4 insurance on the Vessel fully covering P&I risks and (without
                prejudice to Charterers' rights to freely trade the Vessel)
                standard oil pollution cover up to the level customarily offered
                by the International Group of P & I Clubs (currently US$1,000
                million), Hull and Machinery and basic War Risks in accordance
                with the information set out in the Questionnaire; and

          9.6.5 all documentation required to permit the Vessel to trade within
                the Trading Limits set out in PART 1, Section L, including but
                not limited to the certificates and documentation confirmed by
                Owners in the Questionnaire to be in place and such
                documentation shall be maintained in force during the currency
                of the Charter.

10.  MASTER AND CREW

     10.1 The Master, although appointed by Owners, shall throughout the Charter
          Period be under the orders and directions of Charterers as regards
          employment, agency or other arrangements and shall render Charterers
          all reasonable assistance with the officers, crew and equipment
          (including but not limited to connecting and disconnecting hoses for
          loading and discharging, verifying fuel samples and the procedure
          associated with the delivery of fuel) and supply Charterers with such
          information and documentation as they may from time to time require
          (including but not limited to logs, time sheets, safety performance
          information and certification relating to officers, crew or Vessel).

     10.2 The Master shall, throughout the Charter Period, operate the Vessel
          and carry out his duties in a manner consistent with good seamanship,
          complying with

                                                                          PAGE 7
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          the recommendations set out in the latest edition of ISGOTT and
          maintaining the safety of the Vessel, its crew, the cargo and the
          environment, and shall prosecute all voyages with due despatch.

     10.3 The Master shall observe regulations and recommendations as to traffic
          separation and routeing as issued, from time to time, by responsible
          organisations or regulatory authorities, or as promulgated by the
          State of the flag of the Vessel or the State in which management of
          the Vessel is exercised.

     10.4 If Charterers are dissatisfied with the conduct of the Master or any
          officer or crew member, Owners shall on receiving particulars of the
          complaint, promptly investigate the same, and, if necessary, make a
          change in the appointment.

11.  BILLS OF LADING AND WAYBILLS

     11.1 Bills of lading and waybills shall be signed as Charterers direct,
          without prejudice to this Charter. Charterers hereby indemnify Owners:

          11.1.1 against all liabilities that may arise from the signing of
                 bills of lading and waybills in accordance with the
                 directions of Charterers to the extent that the terms of
                 such bills of lading and waybills impose more onerous
                 liabilities than those assumed by Owners under the terms of
                 this Charter; and

          111.2  against all claims brought by holder of bills of lading and
                 waybills against Owners by reason of any deviation ordered by
                 Charterers.

     11.2 All bills of lading and waybills issued under this Charter shall
          include a Clause Paramount and War Risks, New Jason, General Average,
          and Both-to-Blame Collision clauses, in the form set out in this
          Charter.

12.  DRUGS AND ALCOHOL POLICY

     12.1 Owners undertake that they have, and shall maintain for the duration
          of this Charter, a polity on Drugs and Alcohol Abuse applicable to the
          Vessel (the "D & A Policy") that meets or exceeds the standards in the
          OCIMF Guidelines for the Control of Drugs and Alcohol Onboard Ship
          1995 as amended from time to time.

     12.2 Owners shall exercise due diligence to ensure that the D & A Polity is
          understood and complied with on and about the Vessel. An actual
          impairment, or any test finding of impairment, shall not in and of
          itself mean that Owners have failed to exercise due diligence.

                                                                          PAGE 8
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13.    DRY-DOCKING

Without prejudice to Clause 19, Owners shall have the right at their expense to
take the Vessel out of service, including placing the Vessel in dry-dock. For
emergency repairs this right may be exercised in accordance with Owners'
discretion. For routine maintenance and surveys, the right may only be exercised
at a time and place mutually agreed upon by Owners and Charterers.

14.    LIEN

Owners shall have a lien upon all cargoes, hire, sub-hire, freights and
sub-freights for any amounts owed by Charterers under this Charter.

CHARTERERS' RIGHTS AND OBLIGATIONS

15.    CHARTERERS' OBLIGATIONS

       15.1   Charterers shall furnish the Master with full and timely
              instructions.

       15.2   Charterers shall provide and/or pay for:

              15.2.1 all fuels of a quality suitable for burning in the Vessel's
                     engines and auxiliaries (which shall comply with the
                     description in PART 1, Section J except for quantities of
                     fuel consumed while the Vessel is off-hire which shall be
                     for Owners' account; and

              15.2.2 port charges, light and canal dues, and all other charges
                     or expenses relating to loading and discharging; and

              15.2.3 agency fees for normal ship's husbandry at all places or
                     ports of call; and

              15.2.4 towage, pilotage and all mooring, loading and discharging
                     facilities and services, provided always that Charterers
                     shall bear no liability for the negligence or misconduct
                     exercised by the providers of such services and facilities.

       15.3   Any additional premiums charged by the providers of oil pollution
              cover by reason of loading or discharging at ports in the USA or
              USA-controlled territories shall be for Charterers' account and
              shall be re-imburscd to Owners together with the instalment of
              hire next falling due following presentation to Charterers of
              proper receipts evidencing payment.

       15.4   Charterers will not suffer, nor permit to be continued, any lien
              or encumbrance incurred by them or their agents, which might have
              priority over the title and interest of Owners.

                                                                          PAGE 9
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16.    SPACE AVAILABLE TO CHARTERERS

       16.1   The whole reach, burthen and decks of the Vessel, and its
              passenger accommodation (including Owners' suite if any), shall be
              at Charterers' disposal, reserving only proper and sufficient
              space for the Vessel's Master, officers, crew, tackle, apparel,
              furniture, provisions, stores and lubricating oil.

       16.2   The weight of stores and lubricating oil stored on board shall not
              at any time during the Charter Period, unless specifically agreed,
              exceed the tonnage shown in the Questionnaire.

17.    LOADING AND DISCHARGE / SHIP-TO-SHIP TRANSFERS

       17.1   The Vessel shall be loaded and discharged at any port (which term
              for the purpose of this Charter shall include any port, berth,
              dock, loading or discharging anchorage or offshore location,
              submarine line, single point or single buoy mooring facility,
              alongside vessels or lighters or any other place whatsoever as the
              context requires) in accordance with Charterers' instructions.
              Before instructing Owners to direct the Vessel to any port,
              Charterers shall exercise due diligence to ascertain the safety of
              such port, but Charterers do not warrant the safety of any port
              and shall be under no liability in respect thereof except for loss
              or damage caused by Charterers' failure to exercise due diligence.

       17.2   Charterers shall have the option of transferring the whole or part
              of the cargo (which shall include topping-off and lightening) to
              or from any other vessel including, but not limited to, an
              oceangoing vessel, barge and/or lighter (the "Transfer Vessel").

              All transfers of cargo to or from Transfer Vessels shall be
              carried out in accordance with the recommendations set out in the
              latest edition of the "ICS/OCIMF Ship to Ship Transfer Guide
              (Petroleum)". Owners undertake that the Vessel and its crew shall
              comply with such recommendations, and similarly Charterers
              undertake that the Transfer Vessel and its crew shall comply with
              such recommendations. Charterers shall provide and pay for all
              necessary equipment including suitable fenders and cargo hoses.
              Charterers shall have the right, at their expense, to appoint
              supervisory personnel to attend on board the Vessel, including a
              mooring master, to assist in such transfers of cargo.

18.    PERFORMANCE OF VESSEL - SPEED AND CONSUMPTION

       18.1   Unless otherwise ordered by Charterers, the Vessel shall perform
              all voyages at the service speed stated in the Questionnaire.

       18.2   Owners warrant that the Vessel is and shall remain capable of
              maintaining, throughout the Charter Period, the speeds and bunker
              consumptions for

                                                                         PAGE 10
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              propulsion described in the Questionnaire under normal working
              conditions and in moderate weather (which for the purpose of this
              Clause shall exclude any periods of winds exceeding Force 5 on the
              Beaufort Scale). Charterers shall have the right to make
              deductions from hire in respect of any time lost and any
              additional bunkers consumed by reason of the Vessel's failure to
              maintain the warranted capability.

19.    OFF-HIRE

       19.1   The Vessel shall be off-hire on each and every occasion that there
              is a loss of time arising out of or in connection with the Vessel
              being unable to comply with Charterers' instructions (whether by
              way of interruption or reduction in the Vessel's services, or in
              any other manner) on account of:

              19.1.1 any damage, defect, breakdown, deficiency of or accident to
                     the Vessel's hull, machinery, equipment or cargo handling
                     facilities, or maintenance thereto; or

              19.1.2 any default and/or deficiency of the Master, officers or
                     crew, including the failure or refusal or inability of the
                     Master, officers and/or crew to perform the services
                     required; or

              19.1.3 any breach of sub-clause 9.6.5; or

              19.1.4 any other cause preventing the full working of the Vessel.

              Notwithstanding the aforesaid, if the total loss of time pursuant
              to this sub-clause 19.1 is less than three hours in any one
              calendar month, the Vessel shall not be off-hire.

       19.2   If the Vessel deviates, unless ordered to do so by Charterers, it
              shall be off-hire from the commencement of such deviation until
              the Vessel is again ready to resume its service from a position
              not less favourable to Charterers than that at which the deviation
              commenced. For the purposes of this Clause the term deviation
              shall include stopping, reducing speed, putting back or putting
              into any port or place other than that to which it is bound under
              the instructions of Charterers for any reason whatsoever,
              including for maintenance, dry-docking, taking on stores or fresh
              water, but shall exclude deviations made to save life or property.
              Should the Vessel deviate to avoid bad weather or be driven into
              port or anchorage by stress of weather, the Vessel shall remain on
              hire and all port costs thereby incurred and bunkers consumed
              shall be for Charterers' account. Any service given or distance
              made good by the Vessel while off-hire shall be taken into account
              in assessing the amount to be deducted from hire.

       19.3   Any time during which the Vessel is off-hire under this Charter
              may be added, at Charterers' option, to the Charter Period. Such
              option shall be declared in

                                                                         PAGE 11
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              writing not less than one month before the expected date of
              redelivery, or promptly if such event occurs less than one month
              before the expiry of the Charter Period. If Charterers exercise
              their option to extend the Charter Period pursuant to this Clause,
              the Charter Period shall be deemed to include such extension and
              hire shall be payable at the rate(s) which would have been payable
              but for the relevant off-hire event.

20.    LAYING UP

       Charterers shall have the option to lay up the Vessel at a place
       nominated by them and acceptable to Owners. Charterers shall exercise due
       diligence to ascertain the safety of such place but shall be under no
       liability in respect thereof except for loss or damage caused by
       Charterers' failure to exercise due diligence. If Charterers exercise the
       option to lay up the Vessel then the hire stipulated in PART 1, Section H
       shall be adjusted to reflect any net increase in expenditure reasonably
       incurred (including but not limited to costs reasonably incurred in
       preparing the Vessel for lay up as well as restoring it to the condition
       in which it was immediately prior to laying up) or net saving which
       should reasonably be made by Owners as a result of such lay up.

21.    STORAGE

Charterers shall have the option of using the Vessel for floating storage but
Charterers undertake not to use the Vessel for floating storage in areas where
additional premiums for War Risks Insurance are charged by the Vessel's War
Risks Insurance underwriters.

22.    SUB-LET

Charterers may sub-let the Vessel without prejudice to the respective rights and
obligations of either party under this Charter.

23.    SUPERNUMERARIES

Charterers may send supernumeraries in the Vessel's available accommodation upon
any voyage made under this Charter. In such event Owners shall provide
provisions and all requisites, as supplied to officers, except alcohol

24.    VESSEL/CARGO INSPECTIONS/BUNKER SURVEYS

Charterers shall be entitled to cause their representative (which term includes
any independent surveyor appointed by Charterers) to carry out inspections of
the Vessel and/or observe cargo operations and/or ascertain the quantity and
quality of the cargo, water and residues on board, including the taking of cargo
samples, inspection and copying of the Vessel's logs, documents and records
(which shall include but not be limited to the personal notes of the Master,
officers or crew relating to the operation of the Vessel, the rough log book and
computer generated data) at any loading and/or discharge port. Charterers'
representative may also conduct any of the aforementioned operations at or off
any other port to which Charterers may require the Master to divert the Vessel
at any time after leaving any loading port. Charterers

                                                                         PAGE 12
<PAGE>

shall obtain the consent of the owners of any cargo on board at the time before
requiring the Vessel to be diverted.

Charterers' representative shall be entitled to survey, and take samples from,
any or all of the Vessel's cargo tanks, bunker fuel tanks and non-cargo spaces
at any place referred to above.

SPECIAL PROVISIONS

25.    CLAUSE PARAMOUNT

Charterers undertake that all bills of lading and waybills issued under this
Charter shall contain the following:

       "CLAUSE PARAMOUNT

       (1) This Bill of Lading shall have effect subject to any national law
       making the International Convention for the unification of certain rules
       of law relating to bills of lading signed at Brussels on 25th August 1924
       (The Hague Rules) or the Hague Rules as amended by the Protocol signed at
       Brussels on 23rd February 1968 (The Hague/Visby Rules) compulsorily
       applicable to this Bill of Lading. If any term of this Bill of Lading be
       repugnant to that legislation to any extent, such term shall be void to
       that extent but no further. Neither the Hague Rules nor the Hague/Visby
       Rules shall apply to this Bill of Lading where the goods carried
       hereunder consist of live animals or cargo which by this Bill of Lading
       is stated as being carried on deck and is so carried.

       (2) Save where the Hague or Hague/Visby Rules apply by reason of (1)
       above, this Bill of Lading shall take effect subject to any national law
       in force at the port of shipment or place of issue of the Bill of Lading
       making the United Nations Convention on the Carriage of Goods by Sea 1978
       (the Hamburg Rules) compulsorily applicable to this Bill of Lading in
       which case this Bill of Lading shall have effect subject to the Hamburg
       Rules which shall nullify any stipulation derogating therefrom to the
       detriment of the shipper or consignee.

       (3) Where the Hague, Hague/Visby or Hamburg Rules are not compulsorily
       applicable to this Bill of Lading, the carrier shall be entitled to the
       benefits of all privileges, rights and immunities contained in Articles I
       to VIII of the Hague/Visby Rules.

       (4) Nothing in this Bill of Lading shall be construed as in an way
       restricting, excluding or waiving the right of any relevant party or
       person to limit his liability under any available legislation and/or
       law".

26.    SALVAGE

The Master is authorised to render assistance to other vessels. All salvage and
remuneration for such assistance shall be for Owners' and Charterers' equal
benefit after deducting the

                                                                         PAGE 13
<PAGE>

Master's and Crew's proportion and all costs, expenses and sacrifices (including
but not limited to loss of time, off-hire, hire paid, repairs to the Vessel and
bunker fuel consumed). Any non-contractual liability to third parties shall be
for Owners' account unless it solely affects the salvage remuneration.

27.    ICE

The Vessel shall not be required to enter or remain in any icebound port or
area, nor any port or area where lights, lightships, markers or buoys have been
or are about to be withdrawn by reason of ice, nor where on account of ice there
is, in the Master's sole discretion, a risk that, in the ordinary course of
events, the Vessel will not be able safely to enter and remain at the port or
area or to depart after completion of loading or discharging. The Vessel shall
not be obliged to force ice but, subject to Owners' prior approval, may follow
ice-breakers when reasonably required, with due regard to its size, construction
and class. If, on account of ice, the Master in his sole discretion considers it
unsafe to proceed to, enter or remain at the place of loading or discharging for
fear of the Vessel being frozen in and/or damaged, he shall be at liberty to
sail to the nearest ice-free place and there await Charterers' instructions.

28.    REQUISITION

Should the Vessel be requisitioned by any government, de facto or de jure,
during the period of this Charter, the Vessel shall be off-hire during the
period of such requisition, and any hire paid by such government and costs
incurred in respect of such requisition shall be for Owners' account. The option
granted to Charterers in sub-clause 19.3 shall not apply to periods of off-hire
pursuant to this Clause 28.

29.    OUTBREAK OF WAR

Either party may cancel this Charter on the outbreak of war or hostilities
between any two or more of the following countries: the United States of
America, the Russian Federation, the United Kingdom, France and the People's
Republic of China.

30.    WAR RISKS

       30.1   For the purpose of this Clause, the words:

              30.1.1 "Owners" shall include the shipowners, bareboat charterers,
                     disponent owners, managers or other operators who are
                     charged with the management of the Vessel, and the Master;
                     and

              30.1.2 "War Risks" shall include any war (whether actual or
                     threatened), act of war, civil war, hostilities,
                     revolution, rebellion, civil commotion, warlike operations,
                     the laying of mines (whether actual or reported), acts of
                     piracy, acts of terrorists, acts of hostility or malicious
                     damage, blockades (whether imposed against all vessels or
                     imposed selectively against vessels of certain flags or
                     ownership, or against certain cargoes or crews or otherwise
                     howsoever), by any person, body, terrorist or

                                                                         PAGE 14
<PAGE>

                     political group, or the Government of any state whatsoever,
                     which, in the reasonable judgement of the Master and/or
                     Owners, may be dangerous or are likely to be or to become
                     dangerous to the Vessel, its cargo, crew or other persons
                     on board the Vessel.

       30.2   The Vessel, unless the written consent of Owners be first
              obtained, shall not be ordered to or required to continue to or
              through, any port, place, area or zone (whether of land or sea),
              or any waterway or canal, where it appears that the Vessel, its
              cargo, crew or other persons on board the Vessel, in the
              reasonable judgement of the Master and/or Owners, may be, or are
              likely to be, exposed to War Risks. Should the Vessel be within
              any such place as aforesaid, which only becomes dangerous, or is
              likely to be or to become dangerous, after its entry into it, the
              Vessel shall be at liberty to leave it.

       30.3   The Vessel shall not be required to load contraband cargo, or to
              pass through any blockade, whether such blockade be imposed on all
              vessels or is imposed selectively in any way whatsoever against
              vessels of certain flags or ownership, or against certain cargoes
              or crews or otherwise howsoever, or to proceed to an area where it
              shall be subject, or is likely to be subject to a belligerent's
              right of search and/or confiscation.

       30.4   Owners may effect war risks insurance in respect of the Hull and
              Machinery of the Vessel and their other interests (including, but
              not limited to, loss of earnings and detention, the crew and their
              Protection and Indemnity Risks), and the premiums and/or calls
              therefor shall be for their account.

              If the Underwriters of such insurance should require payment of
              premiums and/or calls because, pursuant to Charterers' orders, the
              Vessel is within, or is due to enter and remain within, any area
              or areas which are specified by such Underwriters as being subject
              to additional premiums because of War Risks, then such premiums
              and/or calls shall be reimbursed by Charterers to Owners at the
              same time as the next payment of hire is due.

       30.5   If Owners become liable under the terms of employment to pay the
              crew any bonus or additional wages in respect of sailing into an
              area which is dangerous in the manner defined by the said terms,
              then such bonus or additional wages shall be reimbursed to Owners
              by Charterers at the same time as the next payment of hire is due.

       30.6   The Vessel shall have liberty:

              30.6.1 to comply with all orders, directions, recommendations or
                     advice as to departure, arrival, routes, sailing in convoy,
                     ports of call, stoppages, destinations, discharge of cargo,
                     delivery, or in any other way whatsoever, which are given
                     by the Government of the Nation under whose flag the Vessel
                     sails, or other Government to whose laws Owners are
                     subject, or any other Government, body or group

                                                                         PAGE 15
<PAGE>

                     whatsoever acting with the power to compel compliance with
                     their orders or directions;

              30.6.2 to comply with the orders, directions or recommendations of
                     any war risks underwriters who have the authority to give
                     the same under the terms of the war risks insurance;

              30.6.3 to comply with the terms of any resolution of the Security
                     Council of the United Nations, any directives of the
                     European Community, the effective orders of any other
                     supranational body which has the right to issue and give
                     the same, and with national laws aimed at enforcing the
                     same to which Owners are subject, and to obey the orders
                     and directions of those who are charged with their
                     enforcement;

              30.6.4 to divert and discharge at any other port any cargo or part
                     thereof which may render the Vessel liable to confiscation
                     as a contraband carrier;

              30.6.5 to divert and call at any other port to change the crew or
                     any part thereof or other persons on board the Vessel when
                     there is reason to believe that they may be subject to
                     internment, imprisonment or other sanctions.

              30.7   If in accordance with their rights under the foregoing
                     provisions of this Clause, Owners refuse to proceed to the
                     loading or discharging ports, or any one or more of them,
                     they shall immediately inform Charterers.

31.    GENERAL AVERAGE

General Average shall be adjusted and settled in London in accordance with the
York-Antwerp Rules, 1994 or any subsequent modification thereof.

32.    NEW JASON

If, notwithstanding Clause 31, General Average is adjusted in accordance with
the law and practice of the USA, the following provision shall apply:

       "In the event of accident, danger, damage or disaster before or after the
       commencement of the voyage, resulting from any cause whatsoever, whether
       due to negligence or not, for which, or for the consequence of which, the
       carrier is not responsible, by statute, contract or otherwise, the cargo,
       shippers, consignees or owners of the cargo shall contribute with the
       carrier in general average to the payment of any sacrifices, losses or
       expenses of a general average nature that may be made or incurred and
       shall pay salvage and special charges incurred in respect of the cargo.

       If a salving ship is owned or operated by the carrier, salvage shall be
       paid for as fully as if the said salving ship or ships belonged to
       strangers. Such deposit as the carrier or his agents may deem sufficient
       to cover the estimated contribution of the cargo and

                                                                         PAGE 16
<PAGE>

       any salvage and special charges thereon shall, if required, be made by
       the cargo, shippers, consignees or owners of the cargo to the carrier
       before delivery".

33.    BOTH-TO-BLAME COLLISION

If the liability for any collision in which the Vessel is involved while
performing this Charter falls to be determined in accordance with the laws of
the USA, or the laws of any State which applies laws similar to those applied in
the USA in the circumstances envisaged by this Clause 33, the following
provision shall apply:

       "If the Vessel comes into collision with another vessel as a result of
       the negligence of the other vessel and any act, neglect or default of the
       Master, mariner, pilot or the servants of the carrier in the navigation
       or in the management of the Vessel, the owners of the goods carried
       hereunder will indemnify the carrier against all loss or liability to the
       other or non-carrying vessel or its owners in so far as such loss or
       liability represents loss of, or damage to, or any claim whatsoever of
       the owners of said goods, paid or payable by the other or non-carrying
       vessel or its owners to the owners of said goods and set off, recouped or
       recovered by the other or non-carrying vessel or its owners as part of
       their claim against the carrying vessel or carrier.

       The foregoing provisions shall also apply where the owner, operators or
       those in charge of any vessel or vessels or objects other than, or in
       addition to, the colliding vessels or objects are at fault in respect of
       collision or contact."

Whilst Charterers shall procure that all bills of lading and waybills issued
under this Charter shall contain a provision in the foregoing terms, to be
applicable where the liability for any collision in which the Vessel is involved
falls to be determined under the preamble of this Clause 33, Charterers neither
warrant nor undertake that such provision shall be effective. In the event that
such provision proves ineffective Charterers shall, notwithstanding anything to
the contrary herein provided, not be obliged to indemnify Owners.

34.    OIL POLLUTION PREVENTION

       34.1   Owners undertake that the Vessel is a tanker owned by a member of
              the International Tanker Owners' Pollution Federation Limited and
              will so remain throughout the period of this Charter.

       34.2   When an escape or discharge of Oil occurs from the Vessel and
              causes or threatens to cause Pollution Damage, or when there is
              the threat of an escape or discharge of Oil (i.e., a grave and
              imminent danger of the escape or discharge of Oil which, if it
              occurred, would create a serious danger of Pollution Damage,
              whether or not an escape or discharge in fact subsequently
              occurs), then upon notice to Owners or Master, Charterers shall
              have the right (but shall not be obliged) to place on board the
              Vessel and/or have in attendance at the incident one or more
              Charterers' representatives to observe the measures being taken by
              Owners and/or national or local authorities or their respective
              servants, agents or contractors to prevent or minimise Pollution
              Damage and to

                                                                         PAGE 17
<PAGE>

              provide advice, equipment or manpower or undertake such other
              measures, at Charterers' risk and expense, as are permitted under
              applicable law and as Charterers believe are reasonably necessary
              to prevent or minimise such Pollution Damage or to remove the
              threat of an escape or discharge of Oil.

       34.3   The provisions of this Clause 34 shall be without prejudice to any
              other rights and/or duties of Charterers or Owners whether arising
              under this Charter or under applicable law or under any
              International Convention.

       34.4   In this Clause the terms "Oil" and "Pollution Damage" shall have
              the same meaning as that defined in the Civil Liability Convention
              1969 or any Protocol thereto.

35.    EXCEPTIONS

       35.1   The provisions of Article III (other than Rule 8 thereof), IV, IV
              bis, VII and VIII of the Schedule to the Carriage of Goods by Sea
              Act 1971 of the United Kingdom shall apply to this Charter and
              shall be deemed to be inserted in extenso herein. This Charter
              shall be deemed to be a contract for the carriage of goods by sea
              to which the said Articles apply, and no regard shall be had to
              Article I of the said Schedule. However, nothing in this Clause
              shall be deemed to modify, limit or exclude the parties' rights
              and obligations as set out in Clauses 1, 9, 10, 11, 18 and 19
              hereof.

       35.2   Where a claim for indemnity is brought under this Charter, the
              defending party shall be entitled to rely on all defences and
              limitations, whether founded on contract, tort, legislation or
              convention, that the claimant could have relied on in the
              principal action or in relation to the principal claim.

       35.3   Notwithstanding the aforesaid:

              35.3.1 Where a claim for indemnity relating to a claim pursued by
                     a third party is brought under this Charter, such claim
                     shall be extinguished unless suit is commenced within
                     twelve (12) months of the principal claim being settled by
                     the parties thereto or determined by the final,
                     unappealable judgment of a competent court.

              35.3.2 All other claims shall be subject to the statutory
                     limitation period.

36.    LAW

The construction, validity and performance of this Charter shall be governed by
English Law. The High Court in London shall have exclusive jurisdiction over any
dispute which may arise out of this Charter.

Notwithstanding the aforesaid, the parties may jointly elect to have any such
dispute referred to arbitration in London pursuant to the Arbitration Act 1996
or any modification or re-

                                                                         PAGE 18
<PAGE>

enactment thereof for the time being in force and under the Terms of the London
Maritime Arbitrators' Association before a tribunal consisting of three
arbitrators.

IN WITNESS WHEREOF that parties have caused this Charter to be executed as of
the date first above written for and on behalf of

GRANADA SPIRIT L.L.C.

BY:  TEEKAY LNG OPERATING L.L.C., ITS SOLE MEMBER
OWNERS

for and on behalf of

TEEKAY CHARTERING LIMITED
CHARTERERS

                                                                         PAGE 19<PAGE>

                                                                   EXHIBIT 10.10

                           FORM OF PURCHASE AGREEMENT

THIS NAKILAT SHARE PURCHASE AGREEMENT MADE THE DATE.

BETWEEN           TEEKAY SHIPPING CORPORATION, a Marshall Islands company having
                  an office at Bayside Executive Park, TK House, West Bay Street
                  & Blake Road, Nassau, The Bahamas ("Teekay Shipping");

AND               TEEKAY LNG PARTNERS L.P. , a Marshall Islands limited
                  partnership having an office at Bayside Executive Park, TK
                  House, West Bay Street & Blake Road, Nassau, The Bahamas
                  ("Teekay LNG").

WHEREAS           Teekay Shipping owns all of the common shares of Teekay
                  Nakilat Holdings Corporation;

AND               Teekay Nakilat Holding Corporation owns 100% of Teekay Nakilat
                  Corporation, which in turn owns three subsidiaries (the
                  "RasGas II Subsidiaries"), each of which has contracted to
                  build a liquefied natural gas carrier that is subject to a
                  time charter to Ras Laffan Natural Gas Co. Limited;

AND               Qatar Gas Transport Company Ltd. has three options to purchase
                  up to an aggregate 30% interest in the RasGas II vessels
                  through ownership in either Teekay Nakilat Corporation or its
                  subsidiaries;

AND               Teekay LNG wishes to purchase from Teekay Shipping, and Teekay
                  Shipping wishes to sell to Teekay LNG, all of the common
                  shares of Teekay Nakilat Holdings Corporation.

SO, the parties agree as follows:

1.    INTERPERTATION

1.1   In this Agreement,

      (a)   "Agreement" means this Nakilat Share Purchase Agreement;

      (b)   "Delivered Cost" means the amount determined under Paragraph 2.2;

      (c)   "Parties" means Teekay Shipping and Teekay LNG collectively, and
            "Party" means either of them;

      (d)   "Price" means the amount determined in accordance with Section 2;

      (e)   "Shares" means all of the common shares of Teekay Nakilat Holdings
            Corporation; and

      (f)   "Teekay Nakilat Group" means Teekay Nakilat Holdings Corporation and
            its subsidiaries.

1.2   HEADINGS. Headings contained in this Agreement are included solely for
      convenience, are not intended to be full or accurate descriptions of the
      content of any Section or Paragraph

                                                                     Page 1 of 6
<PAGE>

      and shall not be considered to be part of this Agreement.

2.    PURCHASE AND SALE OF SHARES

2.1   Teekay Shipping shall sell and transfer to Teekay LNG, and Teekay LNG
      shall purchase and receive from Teekay Shipping, the Shares.

2.2   The Price for the Shares shall be determined by the following formula:

            PRICE = DC - X

      where:

      "X" is the amount of any cash or other consideration received by Teekay
      Nakilat Group from Qatar Gas Transport Company Ltd. or its assignee or
      another party for an interest in any member of the Teekay Nakilat Group or
      the RasGas II vessels; and

      "DC " is the Delivered Cost of the three RasGas II vessels, determined as
      follows:

      DELIVERED COST = BUILD + CLOSE + FIN + MODS + SPARES + START-UP + SUPER -
      DEBT

      where:

      "Build" is the shipyard contract price for the construction and delivery
      of all three vessels;

      "Close" are the closing costs associated with the financing of the
      vessels;

      "Fin" is the of cost of capitalized interest on all payments made to the
      shipyard relating to the contract price of the ship. Interest will be
      capitalized at a rate of 8.5% per annum.

      "Mods" is the cost of customer requested modifications made to the vessels
      during construction;

      "Spares" is the cost of depot spares that are purchased by the Teekay
      Nakilat Group during construction;

      "Start-Up" is the cost incurred by the Teekay Nakilat Group in connection
      with the start-up of the vessels, including crew training, crew supplies
      and flag registration;

      "Super" is the cost incurred by the Teekay Nakilat Group in supervising
      the construction of the vessels; and

      "Debt" is the bank debt or liabilities associated with the construction,
      financing, and delivery of the vessels.

2.3   Teekay LNG shall pay Teekay Shipping the Price in two installments as
      follows:

      (a)   at the date of delivery of the first RasGas II vessel, 90% (ninety
            percent) of Teekay Shipping's conservative estimate of the Delivered
            Cost of the RasGas II vessels; and

      (b)   no later than 90 (ninety) days following the date of delivery of the
            third RasGas II vessel, the remainder of the Price.

                                                                     Page 2 of 6
<PAGE>

2.4   Teekay LNG shall pay the Price in one of the following modes, as
      determined by Teekay Shipping with no less than 90 (ninety) days' written
      notice to Teekay LNG:

      (a)   in United States Dollars by negotiable certified cheque, solicitors
            trust cheque, or by wire transfer of immediately available funds;

      (b)   subject to security-holder approval, if required, in accordance with
            the listing standards of the New York Stock Exchange, in units of
            Teekay LNG valued at the lower of:

            (1)   the average closing price during the 10 (ten) day trading
                  period immediately prior to the date of payment; and

            (2)   the price per unit to the public in any offering made by
                  Teekay LNG to finance the purchase within the 90 (ninety) day
                  period immediately prior to the date of delivery of the first
                  RasGas II vessel to be delivered;

      (c)   a combination of (a) and (b); or

      (d)   such other consideration as agreed by the parties with the
            concurrence of the Conflicts Committee of the Board of Directors of
            Teekay GP L.L.C.; or

2.5   Promptly following receipt of the initial installment of the Price, Teekay
      Shipping shall deliver to Teekay LNG the documents of title for the
      Shares.

3.    REPRESENTATIONS OF TEEKAY SHIPPING

3.1   Teekay Shipping makes the following representations to Teekay LNG, and
      acknowledges that Teekay LNG is relying on these representations in
      entering into this Agreement:

      (a)   ORGANIZATION AND GOOD STANDING. Teekay Shipping is a corporation
            duly incorporated, organized and validly existing in good standing
            under the laws of the Marshall Islands;

      (b)   DUE AUTHORIZATION, ETC. Teekay Shipping has all necessary corporate
            power, authority and capacity to enter into this Agreement and to
            perform its obligations hereunder; and the execution and delivery of
            this Agreement has been duly authorized by all necessary corporate
            action on the part of Teekay Shipping.

      (c)   NO IMPEDIMENTS. To the best knowledge of Teekay Shipping after
            making such diligent inquiry as may be reasonable under the
            circumstances, Teekay Shipping has no knowledge of any impediment
            that might impact the transfer of the Shares to Teekay LNG.

      (d)   TITLE TO SHARES. Teekay Shipping is, and Teekay LNG shall become, on
            receipt of the Shares, the absolute beneficial owner of the Shares,
            with good and marketable title to the Shares, free and clear of any
            title defects, mortgages, pledges, hypothecs, security interests,
            deemed trusts, liens, charges, encumbrances or rights or claims of
            others of any kind whatsoever.

                                                                     Page 3 of 6
<PAGE>

      (e)   OWNERSHIP OF SUBSIDIARIES. Teekay Nakilat Holding Corporation owns
            100% (one hundred percent) of Teekay Nakilat Corporation, which in
            turn owns 100% (one hundred percent) of each of the RasGas II
            Subsidiaries.

      (f)   CONTRACTS. Each of the RasGas II Subsidiaries has contracted to
            build a liquefied natural gas carrier that is subject to a time
            charter to Ras Laffan Natural Gas Co. Limited.

      (g)   NO OTHER ACTIVITIES. None of the RasGas II Subsidiaries owns any
            assets, is subject to any liabilities, or is engaged in any business
            activities, unrelated to the RasGas II vessels.

4.    REPRESENTATIONS OF TEEKAY LNG

4.1   Teekay LNG makes the following representations to Teekay Shipping, and
      acknowledges that Teekay Shipping is relying on these representations in
      entering into this Agreement:

      (a)   ORGANIZATION AND GOOD STANDING. Teekay LNG is a limited partnership
            duly formed, organized and validly existing in good standing under
            the laws of the Marshall Islands;

      (b)   DUE AUTHORIZATION, ETC. Teekay LNG has all necessary power,
            authority and capacity to enter into this Agreement and to perform
            its obligations hereunder; and the execution and delivery of this
            Agreement has been duly authorized by all necessary action on the
            part of Teekay LNG.

      (c)   NO IMPEDIMENTS. To the best knowledge of Teekay LNG after making
            such diligent inquiry as may be reasonable under the circumstances,
            Teekay LNG has no knowledge of any impediment that might impact
            payment to Teekay Shipping for the Shares.

5.    NO COMMISSION

5.1   Each Party represents to the other Party that no individual, partnership,
      or corporation is entitled to a brokerage commission, finder's fee or
      other like payment in connection with the purchase and sale of the Shares.

6.    NOTICES

6.1   Any notice, direction or other instrument required or permitted to be
      given by either party under this Agreement shall be in writing and shall
      be sufficiently given if delivered personally, sent by prepaid first class
      mail or transmitted by facsimile or other form of electronic communication
      during the transmission of which no indication of failure of receipt is
      communicated to the sender:

      (a)   in the case of a notice to Teekay Shipping Corporation at:

            TK House, Bayside Executive Park,
            West Bay Street & Blake Road,
            Nassau, The Bahamas.

      (b)   in the case of a notice to Teekay LNG Partners L.P. at:

            TK House, Bayside Executive Park,

                                                                     Page 4 of 6
<PAGE>

            West Bay Street & Blake Road,
            Nassau, The Bahamas.

7.    GENERAL

7.1   EXPENSES. Except as otherwise agreed in writing by the parties, costs and
      expenses (including, without limitation, the fees and disbursements of
      legal counsel) incurred in connection with this Agreement and the
      transaction contemplated under this Agreement shall be paid by the Party
      incurring such expenses.

7.2   ASSIGNMENT/SUCCESSORS AND ASSIGNS. Neither this Agreement nor any rights
      or obligations under this Agreement shall be assignable by either Party
      without the prior written consent of the other Party, which shall not be
      unreasonably withheld or delayed. Subject to that condition, this
      Agreement shall enure to the benefit of and be binding upon the Parties
      and their respective heirs, executors, administrators, successors
      (including any successor by reason of amalgamation of any Party) and
      permitted assigns.

7.3   WAIVER; AMENDMENT. The failure of either Party to enforce any term of this
      Agreement shall not act as a waiver. Any waiver or amendment of this
      Agreement must be specifically stated as such in writing and, in the case
      of Teekay LNG, approved by the conflicts committee of the board of
      directors of Teekay GP L.L.C. if such waiver or amendment materially
      adversely affects Teekay LNG.

7.4   FURTHER ASSURANCES. Each Party agrees that upon the written request of any
      other Party, it will do all such acts and execute all such further
      documents, conveyances, deeds, assignments, transfers and the like, and
      will cause the doing of all such acts and will cause the execution of all
      such further documents as are within its power to cause the doing or
      execution of, as the other Party may from time to time reasonably request
      be done and executed as may be required to consummate the transactions
      contemplated under this Agreement, or as may be necessary or desirable to
      effect the purpose of this Agreement or any document, agreement or
      instrument delivered under this Agreement and to carry out their
      provisions or to better or more properly or fully evidence or give effect
      to the transactions contemplated under this Agreement.

7.5   PUBLIC NOTICES. All notices to third parties and all other publicity
      concerning the transactions contemplated by this Agreement shall be
      jointly planned and coordinated by Teekay Shipping and Teekay LNG and no
      Party shall act unilaterally in this regard without the prior approval of
      the other Party (such approval not to be unreasonably delayed or
      withheld), except where required to do so by law or by the applicable
      regulations or policies of any regulatory agency of competent jurisdiction
      or any stock exchange.

7.6   COUNTERPARTS. This Agreement may be executed by the Parties in separate
      counterparts each of which when so executed and delivered shall be an
      original, and all such counterparts shall together constitute one and the
      same instrument.

IN WITNESS WHEREOF THE PARTIES HAVE DULY EXECUTED THIS AGREEMENT UNDER AUTHORITY
OF THEIR RESPECTIVE BOARDS OF DIRECTORS.

                                                                     Page 5 of 6
<PAGE>

Signed by

for and on behalf of TEEKAY SHIPPING CORPORATION

---------------------------

Signed by

for and on behalf of TEEKAY LNG PARTNERS L.P.

                                                                     Page 6 of 6

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