Operating and Direct Financing Leases (Tables)

12 Months Ended

Dec. 31, 2012

Estimated Future Minimum Rental Payments to be Received and Paid Under Lease Contracts

As at December 31, 2012, the total estimated future minimum rental payments to be received and paid under the lease contracts are as follows:

Year	Head Lease Receipts (1)		Sublease Payments(1)(2)
2013		28,843		24,779
2014		28,828		24,779
2015		22,188		24,779
2016		21,242		24,779
2017		21,242		24,779
Thereafter		239,063		278,884
Total	$	361,406	$	402,779

(1) The Head Leases are fixed-rate operating leases while the Subleases have a small variable-rate component. As at December 31, 2012, the Teekay Tangguh Subsidiary had received $149.0 million of aggregate Head Lease receipts and had paid $90.6 million of aggregate Sublease payments. The portion of the Head Lease receipts that haven’t been recognized into earnings are deferred and amortized on a straight line basis over the lease terms and as at December 31, 2012, $39.1 million of Head Lease receipts had been deferred and included in other long-term liabilities in the Company’s consolidated balance sheets.

(2) The amount of payments under the Subleases are updated annually to reflect any changes in the lease payments due to changes in tax law.

Net Investment in Direct Financing Leases

The time-charters for two of the Company’s LNG carriers, one FSO unit and equipment that reduce volatile organic compound emissions (or VOC equipment) are accounted for as direct financing leases. The following table lists the components of the net investments in direct financing leases:

	December  31, 2012 $			December  31, 2011 $
Total minimum lease payments to be received		675,013			741,604
Estimated unguaranteed residual value of leased properties		203,465			203,465
Initial direct costs and other		1,409			1,636
Less unearned revenue		(443,286	)		(486,797	)
Total		436,601			459,908
Less current portion		12,303			23,171
Long-term portion		424,298			436,737