Thank you for standing by, ladies and gentlemen, and welcome to Dynagas LNG Partners conference call on Friday, the 27th July 2018, second quarter 2018 financial results. We have with us Mr. Tony Lauritzen, Chief Executive Officer; and Mr. Michael Gregos, Chief Financial Officer of the Company. At this time, all participants are on listen-only mode. There will be a presentation followed by a question-and-answer session. [Operator Instructions] I must advise you that this conference is being recorded today. And at this time, I would like to read the Safe Harbor statement. This conference call and slide presentation of the webcast contain certain forward-looking statements within the meaning of the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties which may affect Dynagas LNG Partners' business prospects and results of operations. Such risks are more fully disclosed in Dynagas LNG Partners’ filings with the Securities and Exchange Commission. And now I pass the floor to Mr. Lauritzen. Please go ahead, sir.

Good morning, everyone, and thank you for joining us in our second quarter ended June 30, 2018 earnings conference call. I am joined today by our CFO, Michael Gregos. We have issued a press release announcing our results for the said period. Certain non-GAAP measures will be discussed on this call. We have provided a description of those measures as well as a discussion of why we believe this information to be useful in our press release. Moving to Slide 3. On April 20, 2018, the Ob River matured her contract with Gazprom and delivered in direct the continuation into a 10-year contract with the charter. The rate of hire on the lesser contract was relatively lower, reflecting the longer duration of the contract as well as the prevailing market conditions at the time. The Arctic Aurora completed their 5-year special survey in May 2018 in Ferrol, Spain. The dry docking and maintenance work were done in a very efficient manner counting only 12 day. After having served the spot and short-term market since 3rd of April 2017, the Clean Energy into her approximately 8-year contracts with Gazprom on 13th of July 2018. We believe the Yamal LNG project is progressing very well, and on 1st of July 2018, Yamal narrowed down the delivery windows for the Yenisei River and Lena River to the early as possible as allow by the respective 15-year contracts. Our adjusted EBITDA for the period was reported at $24.4 million with the corresponding adjusted income of $4.5 million. The partnership reported a net income of $0.4 million and distributable cash flow was reported at $8.7 million. Our quarterly cash distribution for the second quarter of 2018 of $0.25 per common unit was paid on 19 July, 2018, and since our IPO in November 2013, we have paid a total distribution per common unit in the amount of $7.29. The partnership is expecting to pay on 13 August, 2018, a cash distribution of $0.5625 for each of its Series A preferred units for the period from May 12, 2018 to 11 August, 2018. Distributions of the Series A preferred units will be payable quarterly on the 12 day of February, May, August and November at an equivalent of $0.5625 per unit provided the same as declared by the partnership’s Board of Directors. I will now turn the presentation over to Michael, who will provide you with further comments to the financial results.

Thank you, Tony. Moving on to Slide 4, we are pleased with the results in the quarter, which exceeded our expectations as operating expenses and the dry dock of the Arctic Aurora were below budget. For the quarter, we regenerated $8.7 million in distributable cash flow and $24.4 million in EBITDA. We are pleased with our operating performance for the quarter of 97% utilization and vessel daily operating expenses, which came in at $10,800 per day per vessel for the quarter versus $13,700 per day per vessel for the corresponding period of 2017. In addition, the cost of the dry dock of the Arctic Aurora ended up at $2.6 million, which was $850,000 below budget. For the quarter, our average gross time charter hire on a cash basis amounted to $61,500 per vessel per day, whereas our cash breakeven excluding our distributions to preferred and common unitholders and our dry docking cost amounted to about $38,700 per day. Including our cash distributions to common and preferred unitholders, our cash breakeven amounted to about $58,500 per day per vessel. Move on to Slide 5. In this slide, we see the progress of our distributable cash flow since we went public and which provides the rationale for Board of Directors’ decision announced on April 18th to use our quarterly distributions to common unitholders by 41% to $0.25 per quarter in order to properly reflect the new free cash flow generating capacity of our fleet as we transition to the longer-term contracts providing for the long-term cash visibility and lower risk. The realigned cash contribution result an annual cash savings of $24.5 million and provides the greatest stability and sustainability of distributions to our equity holders. There realigned distribution is also in line with our strategic focus to preserve cash in order to…

Thank you, Michael. Moving on to Slide 8. Our fleet count accounts six type specification and versatile LNG carriers with an average age of about eight years in an industry where expected useful lifetimes 35 years. Our fleet is able to operate across the globe including ice-bound areas and under the harshest weather conditions. These high vessel specifications are appreciated by global energy companies and we have developed a diversified customer base with oil majors and traders. Our fleet has in the past been employed by companies like Shell, Qatargas, RasGas, Marubeni, Woodside, Kogas and several other major oil and gas companies. Today we have long-term contracts with Gazprom, Equinor formally known as Statoil, and Yamal Energy, which collaborated joint venture between Total, CNPC, Novatek and Silk Road Fund. Our contracted backlog is about $1.44 billion and our average remaining charter period is about 10.1 years, which compares favorably versus our appears. Moving on to Slide 9. Our strategy is to enter into long-term contracts that provide cash flow visibility to stakeholders and allows us to effectively eliminate market volatility and the cyclicality of the shipping industry. Since inception, the partnership’s average remaining term of contracts increased from the books from approximately 4.5 years to more than 10 years. We believe that the excellent characteristics of our fleet have been instrumental in helping us secure long-term contracts and cash flow visibility. Our long-term contracts with Gazprom, Equinor, Yamal and LNG served well-established LNG export projects in harsh weather and icebound areas. Our clients have entered into long-term offtake agreements with LNG reserves and our vessels are vital to their efforts to monetize their production of natural gas. On 13th of July, 2018, the Clean Energy delivered into her approximately eight year contract with Gazprom after serving the short-term and medium-term…

Thank you, ladies and gentlemen. I'll begin the question-answer-session. [Operator Instructions] Your first question comes from the line of Randy Givens from Jefferies. Please ask your question.

So the press release reads our intent is to seek additional contract coverage particularly in 2018. So first, how do you plan on doing that? And then after the upcoming drydockings in the back half of this year, we expect the distribution coverage ratio to exceed 1 maybe 1.1 times in 2019 and beyond. So as such, do you expect any changes to the current distribution level in the coming quarter and years?

I think we've been quite clear from prior conference calls that the distribution coverage is going to be below 1, but that this is not the relevant to the distribution levels. So the distribution, the current distribution, the new distribution of $0.25 a quarter is safe. We don’t - we’re unaffected by the fact that we're trading below onetime distribution coverage because if you look at the cash coverage, on a cash coverage basis, we're trading above 1 times and we also have adequate liquidity to pay that current distribution.

Okay. And then I'll just answer the first part of your question regarding the availability that we have in 2018, and basically the only availability that we have is the Yenisei River. So she comes out of dry dock mid-August and is then available until the end of the year. We feel very confident that we will source an employment for the vessel for that period of time.

And then you mentioned delivery windows for the Yenisei River and Lena River have “narrowed the delivery windows to the earliest possible allowed.” So just for modeling purposes, does that mean January for the Yenisei and July for the Lena?

Well the way that works under the contract is that there are certain windows. So yes, for the Yenisei, now the window is between January 1, 2019 and March 3, 2019. So we assume the earliest in that window. It is within our rights to put the vessel at any given days within that window, so that's why we can then model the earliest types so you can do it January 1. For the Lena River, the window has been narrowed down to 6-months window, which is basically the entire second half of 2019. So it could be any date within that window, but that is in accordance with the contract.

Okay, and then following up on the Yamal. I think during June and July Dynagas removed all three of the vessels from the cold pull. The planet rise envision. Does that mean those Yamal contracts underway if they already begun? Or is that in the coming weeks how is that look?

It's a very good question. First of all we were very happy with the corporation with the other partners in the pool. We enjoyed very much been part of that and we delivered with unique tool in the market that has increasing large spot market. But since the 3 vessels that we had in the pool would ultimately grow on long-term charters to Yamal, it was in our interest to remove them from the pool so we could better manage the trading of those vessels and into their long-term charters. It was important for us to have full control over that. And what we can say now is that a clean has already commenced her term charter with Yamal. And when it comes to the vision and horizon, we have sourced two other charters feeling the entire gas until they go on chatter with Yamal LNG, with another large gas producer.

And then last question from me. Just getting an update on refinancing of the 250 million, 6.25% senior unsecured notes to next October, I think on the last call, you said that was likely to be in 2018 event. Is that still the case?

We, think still likely 2018 event. Yes.

Next question comes from the line of Ben Nolan from Stifel. Please ask your questions.

So I have a little bit more of a maybe higher-level question or strategic question for you. So obviously you had to cut the distributions a bit. You indicated on the call that the intent going forward is to probably, well, certainly refinance to the notes but also delever a bit, if I heard correctly. But then again you talk about all these potential dropdown candidates and there are a lot -- they have fantastic contracts on them. And I think you would probably agree that your cost of capital isn’t really ideal for that. How do you envision the partnership moving forward to be able to accomplish all these things? How are you, how do you think, you can maintain the devotees grow the fleet continue to pay down debt? I mean, there’s a lot of levers to pull?

Listen, I think what we’re doing is, we’re taking a step-by-step approach, so how we’re handling things. So first of all, all the ships have been employed and they’re under the long-term contracts. Second of all, we are focused on refinancing our notes. I mean that’s our immediate priority. When that happens, then I think we can start addressing all the questions that you’re asking. Of course, you ask how do you envision maintaining the distribution. I think the maintaining this abusive we’ve already achieved that with our previous distribution realignment, I mean, if you look at our cash flows, they’re supported, the distribution is supported by our current cash flow profile for quite a long time. So the cost of capital and the potential dropdowns are important questions, but I think we have to focus on refinancing the notes, and then once that is done then we can focus on these very important questions.

I didn’t mean to imply that your distributions wouldn’t be covered after all of the contracts are in place. Just that beyond the distributions, it’s not as though the cash flow that is generated over and above that. Could both service acquisitions and debt repayment at least not by my numbers, but I understand that one step at a time refinance and then sort out the growth. Maybe, Tony, move stepping over to the FSRUs obviously a handful a couple now of FSRUs orders that I assume are under construction. And would be part, I would think of that pool of potential candidates to acquire at some point. Just curious in your role on a private side, how are you approaching the employment of those? Is it standard long-term contracts? Or you kind of looking to take a little bit more of an integrated approach and be a partner and a project rather than just an equipment provider?

Yeah. So, the delivery of these FSRU for 2021. So there haven't been any, let's say, heavy marketing as of yet because there is some distance to go in terms of time. But no, these FSRUs are quite different from other standard types of FSRUs because they’re really do a purpose carriers meaning that they can sale as ordinary LNG carriers, tune Skegness, two propellers and efficient machinery at 19.5 knots, and they can also do 750 standard cubic feet a day in regas capacity. So, mostly FSRUs are handicapped when it comes to speed and consumption, but these are not. They’re really dual purpose. So I think that they have a wider market than the typical FSRU. And I think, therefore, there will be very suitable for term employment with a portfolio player. So we feel very confident that the specification of these vessels are the best in the markets and should be of great interest for many different takers.

Okay, and it is fair to assume grant and years down the line but that would be part of a potential suite of drop down assets that that might be available to the partnership, correct?

Yeah. I mean, this has being discussed on a sponsor level and we obviously cannot answer for our sponsor. But yes, that maybe the case.

Okay. Alright, thanks a lot. Appreciate it, guys.

Thank you. The next question comes from the line of Fotis Giannakoulis from Morgan Stanley. Please ask your question.

You will excuse me if I insistent a little bit on your growth plan. And since all your vessels are contracted long term, there is very little uncertainty about your cash flows. And I still trying to find a way how we think the dropdowns of the Yamal vessels of the Europe sponsors. What is that you are expecting a in order to make this happen? Is it the fact that the dividend yield in the MLP space not only is it the fact that this will happen after the refinancing? How much equity each of these vessels requires? Or how much --- or how much are you going to finance them? And is there any way that you going to fund these vessels with alternative form of capital, except we’re raising common equity at this high-yield trading.

I mean, as I told then, I mean these are all excellent questions, but the reality is these are discussed and these are thoughts that we are having internally. We don't -- we're focused on refinancing our bond. All the other options that we have potentially for growing the company with the dropdowns is something we're seriously thinking about. Clearly, I mean you are concerned that how you're going to get your dividend yields down in order to be able to do ups that's the number down that we'll concerned. But…

I'm actually concerned and trying to understand how you're going to bring your dividend up. I don't think about anybody worries about level of your dividend at this point, but we are trying to understand what is the roadmap for a dividend increase from this level?

Listen, at this particular stage, it's premature to discuss dividend increases. What I think -- I have to repeat the same answer that I gave Ben, which is everything we have to take step by step. That was a very long-term contracts, the dropdown candidate. So there is time we don't we're not pressed to find a solution for SAP. And all of these things are thinking about. Whatever decision we make has to be the optimal decision, which will not affect the long-term financial spending of the partnership. So that's all that we can say at this particular stage.

Thank you, Michael. I appreciate. And going to back to the dropdown candidates, you have 4 vessels with the very long-term contracts which you fully owned and 4, 5 vessels with -- the Ice Class vessels that you jointly owned. How much financing these vessels can get based on this extra-long contracts that they have?

Can you repeat? Which vessels were you talking about?

I'm talking about the Yamal vessel that you fully owned and the dropdown candidate, the Planet, the Horizon, the region, but also -- the Arc-7 vessels that they also have extremely long contracts. How much debt can you put on these vessels when you go to your banks?

Listen the Arc-4 vessels have already financing. We don't anticipate that they would require to be refinanced if we've dropped into the MLP. It is a current financing arrangements has carved out the possibility to drop down. The debt on these vessels from between $145 million to $180 million. It depends on the vessel. There is significant debt service on these vessels, which means that it totally takes [Indiscernible] to wait a little while until the debt amortizes a more differently so the deal to be more cash flow accretive for the partnership. The Arc-7 are basically an investment. So we own 49% of the entity that own these vessels. So basically we have previously communicated that the dividend that we expect per vessel on an annual basis is about is $5 million.

Thank you, Michael. And moving a little bit on the overall market and on the appetite of buyers for securing long-term volume. We have seen that demand has surprised by far exceeding expectations, particularly in China. But the last few months we have seen a lull in off-take activity. I was wondering why is that. And at what point do you think that we will see more long-term offtake contracts? And at what point we are going to see final investment decisions for new projects as market seems to be balancing faster than most people thought before?

That’s a very good question. When it comes to long-term offtake agreements and the frequency of entering into contracts, it’s pretty difficult for us to say because we’re not directly involved in that. But I think it’s fair to say that it’s related to pricing. I mean what at least we’ve seen in the past I believe that when pricing on energy pricing is relatively high, then you see the entry into offtake agreements and one is very low, then some offtakers rely on the spot market. So I think also this when it comes to China that is driving a lot of the appetite and the buying, that’s also potentially affected by this trade wars that we here now. So it’s difficult to say what the frequency in offtake agreements will be. But I think what we’re seeing in general is that whether LNG produced on long-term arrangements or short-term arrangement, it’s all being absorbed. And I think that’s important thing.

Thank you very much for this answer. One last question. I know this is not an immediate demand driver for a -- or major demand driver for LNG. But a lot of people are talking about the IMO 2020 and the potential expansion of the use of LNG as a fuel. If we have a window of 5 to 10 years, do you have an estimate of how much demand for LNG as a fuel for bank here we can see? Is this a meaningful amount and have you seen projects accelerating after the date for 2020 is approaching?

Yes. That’s also a very good question, Fotis. Look, when you look at the sectors where natural gas is used today, then industries and then power generation is by far the leading sectors and the transportation sector is, let's say, the least important for natural gas today. Of course, the oil market is by far very dominant in the transportation sector. So over time, we believe that natural gas will -- we'll be able to in to that segment. But I think it's still some distance away. Yes, we see more small scale projects, bunkering projects this type and I think some of it will materialize certainly. But it will take time until we’re there. I don't think you are to be too many ships of other types and LNG there'll be ready 1st of January 2020. I doubt that will be too much infrastructure around to support, but definitely we see the then this moving in the right direction.

Thank you very much, guys. Appreciate your answers.

[Operator Instructions] And your next question comes from the line of Hillary Cacanando from Wells Fargo. Please ask your question.

Yes. Thanks for taking my question. So NOVATEK Arctic LNG to has been gaining momentum recently. I was just wondering are there any opportunities for you to get involved, should that project move forward maybe perhaps by ordering you or four or seven vessels or even at the current level?

Thank you very much for that question. Yeah. So we think it's an interesting project, we think it's a project that is a sound one given the successful Yamal LNG. The shipping requirements are now out, yes, as far as we are aware. So, I guess the only thing we can say as of today is that we think we will be well qualified for project on that.

And are there any other projects on other than Arctic LNG too that are that are currently being proposed or consider that would require ice-class vessel? The only thing I could think of is already the LNG to I don't know do the others out there or may be less unknown.

No, no. Yeah, I mean, when you have potential expansion of the cycling project or pencil renewal sleep, and then you are the same or a quinoa project of the Northern Norway potential when your fleet at some point. So yes, we do believe that. You know that there are other projects than strictly those that are related, that are close proximity to the mountain Angela.

Thank you. There are no further questions.

Well thank you very for listening in on our earnings call, and we look forward to speaking with you on our next quarter. Thank you very much.