June 18, 2012

Teekay Offshore Partners Investor Day Presentation

2 www.teekayoffshore.com

This presentation contains forward-looking statements (as defined in Section 21E of the Securities

Exchange Act of 1934, as amended) which reflect management’s current views with respect to certain

future events and performance, including statements regarding: the Partnership’s future growth

prospects, cash flows and distributions to unitholders; the timing of delivery of vessels under

construction or conversion; the industry fundamentals for deepwater offshore oil production, storage

and transportation; the potential for Teekay to offer additional vessels to the Partnership and the

Partnership’s acquisition of any such vessels, including the Petrojarl Foinaven, the Petrojarl Cidade de

Itajai, the Voyageur Spirit, the Hummingbird Spirit and the newbuilding FPSO unit that will service the

Knarr field under contract with BG Norge Limited; and the potential for the Partnership to acquire other

vessels or offshore projects from Teekay or third parties. The following factors are among those that

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

and uncertainties, and that should be considered in evaluating any such statement: vessel operations

and oil production volumes; significant changes in oil prices; variations in expected levels of field

maintenance; increased operating expenses; variability in shuttle tanker tonnage requirements under

the Statoil master agreement; different-than-expected levels of oil production in the North Sea and

Brazil offshore fields; potential early termination of contracts; failure of Teekay to offer to the Partnership

additional vessels; the inability of the joint venture between Teekay and Odebrecht to secure new Brazil

FPSO projects that may be offered for sale to the Partnership; failure to obtain required approvals by

the Conflicts Committee of Teekay Offshore’s general partner to acquire other vessels or offshore

projects from Teekay or third parties; the Partnership’s ability to raise financing to purchase additional

assets; and other factors discussed in Teekay Offshore’s filings from time to time with the SEC,

including its Report on Form 20-F for the fiscal year ended December 31, 2011. The Partnership

expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any

forward-looking statements contained herein to reflect any change in the Partnership’s expectations

with respect thereto or any change in events, conditions or circumstances on which any such statement

is based.

Forward Looking Statements

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• Leading market positions

○ Market leader in harsh weather FPSOs and shuttle tankers

• Stable operating model

○ Diversified portfolio of fixed-rate contracts with major oil companies

• Visible growth through accretive acquisitions and projects

○ Seven FPSO units will be available for purchase from Sponsor, Teekay

Corporation

○ Four advanced shuttle tankers scheduled for delivery in 2013

• Strong fundamentals driving industry growth

○ High E&P spending driving record number of planned FPSO projects

• Advantageous tax structure

○ Teekay Offshore is a 1099 filer – no K-1 reporting requirements

Investment Highlights

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• Teekay Offshore completed IPO

in Dec. 2006 by Teekay Corp.

• $1.9bn* Market Cap

• Strong Sponsor

○ Teekay Corp. ownership: 33%

(incl. 2% GP interest)

• Core focus: Deepwater offshore

production, floating storage and

transport projects

• 56 vessels in global fleet (Shuttle

tankers, FSOs, FPSOs, oil

tankers)

• 3 -10 years fixed-rate contracts

Teekay Offshore Overview

*As at June 8, 2012

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Increase distributions per unit by executing on the following strategies:

• Expand presence in high-growth regions

○ Focus on leadership positions in Brazil and North Sea

• Continue to pursue new high-return projects in the FPSO, FSO and

shuttle tanker segments

• Opportunistically acquire existing assets on long-term fixed-rate

contracts

○ Preference for assets with contracts provides immediate accretion

○ Several FPSOs at Sponsor – received offer to acquire Voyageur Spirit

FPSO from Teekay Corp

• Provide superior customer service by maintaining high reliability,

safety, environmental and quality standards

○ Operational expertise is a competitive advantage

Strong Industry Fundamentals Support Our

Business Strategy

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Source: Clarkson Research Services, Platou, Company Websites, Industry Sources.

Market Leader in Core Segments

Leading Operator of

Leased FPSOs in the

North Sea

Control More Than

50% of the World’s Fleet

TeekayOffshore /

TeekayCorp.

Bluewater Maersk BWOffshore

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TeekayOffshore

KnutsenNYK

Transpetro Viken /PJMR

Lauritzen

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7 5

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22

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Existing Newbuildings on Order

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Expertise in Deepwater and Harsh Environments

North Sea

• 20 shuttle tankers owned,

4 in-chartered

• 1 FPSO + 6 owned

by Sponsor

Brazil

• 16 shuttle tankers owned

• 2 FPSOs + 1 owned by

Sponsor

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• Substantial portfolio of long-term, fixed-rate contracts with high quality

oil and gas companies

○ Total forward fixed-rate revenues of $3.8 billion

○ Weighted average remaining contract life of over 5.0 years

Attractive Contract Portfolio

5.4 years

3.2 years 2.8 years

Average

Contract Life

High

Quality

Customers

Shuttle Tankers FSO Units Conventional Tankers

4.1 years

FPSO Units

Forward

Revenues $2.6 bn $0.2 bn $0.3 bn

$0.7 bn

40 5 8 # of units 3

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2012 2013 2014 2015 2016 2017 2018

Vessel Built 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4

Fuji Spirit 2003

Kilimanjaro Spirit 2004

SPT Navigator 2008

SPT Explorer 2008

Poul Spirit 1995

Gotland Spirit 1986

Hamane Spirit 1997 Sold

Torben Spirit 1994 For sale

Leyte Spirit 1992 In lay-up, FSO candidate

Luzon Spirit 1992 In lay-up, FSO candidate

• Expect reduction in conventional tanker fleet

○ Do not anticipate renewing conventional tanker charters

○ Will keep some conventional hulls for future redeployment as FSOs

- Two hulls currently tendered for FSO project in Asia

• Acquisition of FPSOs will replace lost cash flow

○ Example: cash flow from Piranema FPSO = approximately 4 conventional tankers

Conventional Tanker Portfolio Rolling-off

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• Since IPO, greater proportion of TOO’s cash flow has come from high-

growth FPSO sector

○ Higher risk-adjusted returns

○ With roll-off of conventional tanker contracts, TOO is becoming a true ‘pure-play’ in

the build-out of offshore crude oil

TOO’s Business Mix is Evolving

*Cash flow from vessel operations represents income from vessel operations before depreciation and amortization expense, write-down of vessels and amortization of deferred gains and in-process

revenue contract, includes the realized gains (losses) on the settlement of foreign exchange forward contracts and adjusting for direct financing leases to a cash basis. Cash flow from vessel operations

is a non-GAAP financial measure used by certain investors to measure the financial performance of shipping companies. Please see the Partnership’s web site at www.teekayoffshore.com for a

reconciliation of this non-GAAP measure as used in this release to the most directly comparable GAAP financial measure.

TOO Q1-07 CFVO*

By Segment

66%

29%

5% 56%

7%

10%

27%

Conventional Tankers FPSOs Shuttle Tankers FSOs

TOO Q1-12 CFVO*

By Segment

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Significant Visible Growth Opportunities

Petrojarl

Foinaven (BP)

Petrojarl I

(Statoil)

Petrojarl Banff

(CNR)

Hummingbird

Spirit (Centrica)

Voyageur Spirit

(E.ON)

4 Shuttle

Tankers (BG)

Directly ordered

by TOO

Assets and Contracts

Suitable for Acquisition

Acquisition Candidates

Following Contract

Renewal / Amendment

Knarr FPSO

(BG)

Cidade de Itajai

(50%)(Petrobras)

Omnibus agreements with Teekay & Sevan provide additional opportunities

Received offer

from Teekay Corp

12 www.teekayoffshore.com

• Charterer: E-ON Ruhrgas

• Year Built: 2009

• Upgrade in progress at Nymo

Shipyard in Arendal, Norway

• Expected First-Oil: Oct. 2012

• Cylindrical hull design by Sevan

Marine

• Firm Contract Length:5 years

• Contract Options:

evergreen with 12-month

cancellation

• Expected CFVO ~$75m p.a.

• Operating Water Depth +120m

• Processing Capacity: 30,000

bbls/d

• Storage Capacity: 270,000 bbls

• Field Application: Oil production,

Gas export and water injection

• Huntington Field North Sea, U.K.

Voyageur Spirit FPSO (ex. Sevan Voyageur)

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• Charterer: BG Group

• Delivery Dates:

○ Hull 2037, Q2-2013

○ Hull 2038, Q2-2013

○ Hull 2039, Q3-2013

○ Hull 2040, Q4-2013

• Suezmax-sized DP2 shuttle tankers

• Delivered Cost: ~$120m / vessel

• Being constructed at Samsung

Shipyard, South Korea

• Contract Length:

10 years plus 2 x 5-year options

• Will service BG’s pre-salt

requirements

• BG is one of the largest

international oil companies

operating in Brazil

Four BG Shuttle Tankers

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• Charterer: Petrobras

• Expected First-Oil: December 2012

• Aframax conversion at Jurong

Shipyard, Singapore

• 50/50 Joint Venture with Brazil-

based Odebrecht

• Firm Contract Length: 9 years

• Extension Options: 6 x 1 years

• Expected CFVO: $25m (50% basis)

• 80% Project Financing arranged

with syndicate of International Banks

• Designed Water Depth:

up to 1,000m

• Operating Depth: ~250m

• Processing Capacity: 80,000 bbls/d

• Storage Capacity: 650,000 bbls

• Tiro & Sidon fields on Block BM-S-

40, Santos Basin, offshore Brazil

○ +150 million barrels of recoverable oil

Petrojarl Cidade de Itajai FPSO (ex. Tiro & Sidon)

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• Charterer: BG Group

• Expected First-Oil: 1H 2014

• Purpose built in South Korea by

Samsung Heavy Industries

• Firm Contract Length: 6 or 10

years

• Extension Options:

up to 20 years (total)

• Processing Capacity: 63,000

bbls/d

• Designed to handle a wide-range

of LPGs

• Operating Water Depth: ~400m

• Est. Recoverable Reserves:

70-150 mmbbls

• Knarr Field, North Sea

Knarr FPSO

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Leading indicators for offshore

production, storage and

transportation demand

Linking Rig to Refinery

Teekay’s role in the

offshore value chain

17 www.teekayoffshore.com

Drilling Activity a Key Leading Indicator

0

20

40

60

80

100

120

0

20

40

60

80

100

$ / B

BL

Oil

Pri

ce

MO

DU

Ord

ers

MODU Orders Versus Oil Price

Jack Ups Semi-subs and Drillships Oil Price (USD)

• 81 mobile drilling unit (MODU) orders placed in 2011

○ Highest since 1980

• Growth strongest in the deepwater / ultra-deepwater drilling fleet

• Deepwater wells yielding the biggest results

○ Average discovery size in 2010 for wells >1,500m depth was 1,000+ mboe

Source: Clarksons, Douglas Westwood, BP

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• Resurgence in North Sea

drilling activity yielding

results

○ 1.7 - 3.3 billion barrel Johan

Sverdrup find was biggest of

2011

• New finds tend to suit an

FPSO and shuttle tanker

solution

• Enhanced Oil Recovery

leading to renewed

production in mature areas

• Move into Barents Sea

requires high-specification

shuttle tankers and FPSOs

North Sea Market – Resurgent Activity

Record high level

of exploration

*Source: Norwegian Petroleum Directorate

Norwegian Exploration Wells Drilled*

Norwegian Sea

(existing shuttle

region)

North Sea

(existing shuttle

area)

Barents Sea

(emerging

shuttle region)

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Brazil Market – More Growth to Come

0

20

40

60

80

100

120

140

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Brazil Offshore Production Fleet Development

Installed On Order Planned

• Brazilian offshore production fleet set to double in 2011-18

○ Growth in offshore production drives demand for shuttle tankers and FPSOs

• Petrobras is aggressively increasing its production capability

• Other oil companies also have shuttle requirements in offshore Brazil

Source: IMA

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• The number of projects which could require an FPSO has doubled in

the past five years

• Estimate of 20-28 FPSO orders per year over the next five years

depending on the global economy, oil demand and energy prices

• Operational and engineering expertise required to be successful in

the leased FPSO business creates a high barrier to entry

Strong Future Demand for FPSOs

0 50 100 150

Apr-12

End-08

End-06

141

96

68

FPSOs in the Planning Stage

0

5

10

15

20

25

30

Avg.Orders

per year

OrdersJan-Apr

2012

LowCase

BaseCase

HighCase

15

10

20

24

28

FPSO Forecast (Next 5 Years)

Avg.

Orders

per year

Orders

Jan-Apr

2012

Low

Case

Base

Case

High

Case

Source: IMA Source: IMA

(2007 – 2011) Next 5 Years

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• Resurgence in offshore activity creating new FSO opportunities

○ Re-emergence of FSO demand in the North Sea

○ New development in S.E. Asia

• 22 projects currently considering the use of an FSO

○ 11 in Asia; 4 in North Sea

Increased Demand for FSO Solutions

0

2

4

6

8

10

12

S.E. Asia NorthSea

MED GoM Brazil Africa

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4 3

2 1 1

Planned FSO Projects

0

2

4

6

8

10

TankerPacific

Teekay Modec TradaMaritime

MISC

7

5

4 4

3

Top Leased FSO Operators

4 Owners with 2 units

19 Owners with 1 unit

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• Leading market positions

• Stable operating model

• Visible growth through accretive acquisitions and projects

• Strong fundamentals driving industry growth

• Advantageous tax structure – no K-1 reporting requirements

Investment Highlights