Thank you for standing by, ladies and gentlemen, and welcome to Dynagas LNG Partners Conference Call on the Second Quarter 2017 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 in a listen-only mode. [Operator Instructions] I must advise you that the conference is being recorded today. At this time, I would like to read the Safe Harbor statement. This conference call and the 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 I now 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, 2017 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. The earnings for the financial quarter ended June 30, 2017 were within our expectations. There were particular cost items that fell into this particular quarter that affected the results. 50% of our fleet entered dry dock for the scheduled maintenance. Loan fees related to the financing prior to the Term Loan B and the Clean Energy is trading on a relatively weak spot market until her delivery into her long term charter in July 2018. Turning to Slide 2, Clean Energy and Ob River completed their five-year special survey and related dockings in the second quarter. The Amur River commenced its five-year special survey in the second and completed the same in the third quarter. We are satisfied that the class surveys including dry dockings were completed quickly and efficiently with only an average of 15 days between arrival to departure at the repair yard. The vessels are in a five-year special survey cycle, meaning one would expect about five years between each such event. In April 2017, the Clean Energy became available for employment at which time we entered into two consecutive short-term charters with Gazprom to employ the vessels through the end of August 2017. Following the expiration of these charters the vessel is employed on an additional short time charter with Petrochina and will continue to be employed on the…

Thank you, Tony. Turning to Slide 3 of the presentation, as anticipated our financial results were impacted by the one-off charges of $7.5 million related to the fact that half of our six vessels fleet underwent their special survey and dry dock in the second quarter at the cost of $4.9 million and the one-off charge of $2.6 million related to the write-off of unamortized deferred loan fees associated with the Partnership's prior indebtedness which is a refinance with a Term Loan B in May of this year. Please note that the Partnership expenses class survey costs as incurred and that two of our vessels commenced and completed their class surveys in the second quarter. Therefore the second quarter results include the full class survey dry dock costs for these two vessels. The third vessel, the Amur River commenced dry dock in the second quarter and completed it in the third quarter and as a result approximately half of the class survey cost for the Amur River has been charged in the second quarter with the remaining to be reflected in next quarter's results. Our operating results were also impacted by the lower revenues attributable to the Clean Energy which is the only vessel in our fleet currently trading in the short-term market pending her delivery into an eight-year charter next year. The off hire days related to the three vessels that were dry docked and the higher interest expense following our Term Loan B. During the second quarter of this year the Partnership generated revenues of $32 million and adjusted net income of $4.2 million. For the same period of 2016 revenues amounted to $42.6 million and adjusted net income to $18.8 million. Our adjusted figures take into consideration the class survey costs and non-cash items such as charter…

Thank you, Michael. Let's move on to Slide 8 to summarize the Partnership's profile. Our fleet currently accounts six high specification and versatile LNG carriers with an average age of about 7.1 years in an industry where expected useful economic lifetime is 35 years. We have a diversified customer base with substantial energy companies, namely Gazprom, Statoil and Yamal LNG which the latter is the international joint venture between Total, CNPC, Novatek, and the Silk Road Fund. Our contract in backlog is about $1.49 billion and our average remaining charter period is about 10.2 years which compares well versus our peers. Our vessels have also served customers such as Qatargas, RasGas, Marubeni, Woodside, Kogas, CPC, North West Shelf and several other major oil and gas companies. We therefore have a large customer base that we are able to contract with. Moving on to Slide 9, our fleet of LNG carriers are largely fixed on long-term charters with strong and reputable energy companies and we have a very low availability going forward. Drivers for our charters were the characteristics of the fleet including its ice class notations and our organization's track record. The contractual relationship between our customers and the vessels on a time charter party basis, under a time charter party the charterer pays a fixed day rate to the owner regardless if the vessel is being used or not and all major variable costs such as fuel cost are for the charterer's account. There are also no early termination rights for convenience for the charterer. Therefore and coupled with our multiyear employment profile the Partnership enjoys visible and stable revenues that are not directly affected by oil or gas prices. We have minimal capital requirements which provides significant free cash flows. Compared to other shipping segments, LNG shipping is…

Thank you very much indeed. [Operator Instructions] And your first question from Stifel comes from the line of Ben Nolan and your line is now open sir.

Yes, thanks. Hey guys, I had a few questions related to the Yamal project, the first is there is a little footnote in the presentation – in the press release that said that the charters are subject to certain conditions and would require waivers or what not. Is there anything incremental there or is that just sort of the way that it’s always been and you don’t expect there to be any issues?

Yes, hi Ben. Thanks for that question. Yes that is something that has always been there and that footnote was related to a time of concluding in particular the two charters were the Yenisei and the Lena River. They form part of a package deal that our sponsor would do on other shipping class assets. So basically since there was a package deal Yamal just wanted to make sure that we perform on – that our sponsor performed on the other vessels as well, but nothing has changed there and everything is going well.

Okay, good. So and then related to that, I know obviously Yamal has made good progress and when thinking through the timeframe as to when your charters actually become effective, both obviously at the partnership level but then also at the sponsor level, what hurdles need to be clear to what exactly needs to happen in order for those to take effect and do you have any sort of updates on exactly what’s been taking place in Yamal?

Ben, sorry did you mean related to those conditions on those vessels?

No, no, no, no, I mean separately so you know, I know that...

Oh, yes, just in general. Well, I mean these vessels in the Partnership and on the sponsor level is on a time charter basis with a defined time of delivery. So the vessels will be delivered regardless of the status of the project and the project is as we understand well capitalized. That being said, as far as we are aware, everything is going very well for Yamal producing first cargo in October. So as with every project there is a ramp up period where you start to produce smaller quantities and you ramp up over time. So I guess that the hurdle for the project is to ensure that the terminal and all the equipment works so that the ships that they have by then taken the debris off, it can be filled up and trade their cargo.

Okay. So with respect to I suppose to at the sponsor level, the two Arc-7s later coming online or later this year if the - whether or not the project is working, you guys are going to be paid, that is correct?

That’s correct, that’s correct and that’s further guaranteed by shareholders of the project.

Right. Okay and then lastly from me just sort of thinking through how this big new way of Yamal vessels and contracts come in, obviously you’ve been bit of a chicken and the egg issue in terms of dropdown schedules and so forth, but do you feel any additional sort of pressure or momentum to maybe start to find a way to grow the fleet in order to get the ball rolling on the dropdown of these Yamal vessels or how exactly you’re thinking through where you stand in that respect?

Hi Ben, this is Michael. No nothing has really changed from our perspective. We feel that we’re in a pretty good position. We have the luxury to wait. We don’t want to do something which would put us in a worse off position in the future and when I say I mean something is that, we don’t issue equity which is prohibitedly expensive. So we’re in a position where the distribution, the current distribution is safe and we believe that the best way forward is to be patient and be opportunistic also when the time comes.

Okay. All right, I’ll turn it over. Thanks guys.

Thank you very much indeed sir. And your next question from Credit Suisse comes from the line of Gregory Lewis and your line is now open sir.

Thank you and good afternoon, this is Joe Nelson on for Greg today.

Hi, how are you?

Good and just first question from me in your prepared remarks you talked about any future dropdown growth coming with deleveraging and as well as looking to this opportunity of four to five-year balance sheet, I’m just wondering as we think about the balance sheet do you have any target leverage in mind as to where you prefer the balance sheet to be either now and then as far as any future acquisitions or dropdowns or concerns?

Well we do have leverage targets. In order to attain these targets first of all we would have to dropdown a couple of ships. And second of all there would have to be a larger mix than of equity rather than debt. I think ideally we would like to be somewhere in the 4.5 to 5 times range. That would be our let's say long term target.

Okay, thanks and then second one maybe a little bit more market related. You mentioned that maybe some of the conversations you're having now with some of your counterparties regarding term employment isn't as I guess maybe as rewarding as you'd like it to be. I mean, what do you think we need to see to really get the time charter market perking up here and maybe reflecting some of the improvements that we've seen in activity in the spot market so far this year?

Yes, thank you very much for that question. I think we need to see the market continue on the same path which it is now. I mean we've in the short term market we've seen an improvement during the last three months or so I would say and there is a lot more activity in general on the short term. For example, in July and August, I think we had almost record numbers of short term fixtures. If we look at for example the entire 2016 you had about 270 spot market fixtures and year-to-date we're up in 2014 already. So, I believe that we're on the right track with the utilization being up with charter rates in general being on an improving trend. This is the result of increased supply of LNG. In the past we would see these trends being as a result of let’s say arbitrage in the market et cetera, but it’s very little, so this basis we think is strictly a result of more LNG coming. So I think that we just have to be patient as a result of more and more LNG coming. I mean, every quarter there is more. Within 2019 we will have pretty substantial volumes already been added to the market with relatively limited shipping supply and also given that the world's fleet is consisting of many aged vessels, small vessels, inefficient vessels. I think that we are on the right - on the right trend and that's exactly what we said just earlier as you commented on that we think it's better to sit back and wait a little bit for the availability that we would potentially have in 2018 instead of entering too many discussions on that right now.

Thank you very much, Tony. I appreciate the time today and I'll turn it over.

Thank you very much.

Thank you very much. [Operator Instructions] Now this question from Wells Fargo comes from the line of Hillary Cacanando. And your line is now open ma’am.

Hi, thanks for taking my call. Just wanted to get your thoughts around counterparty risk as it relates to Yamal and Gazprom just given the fresh rounds of tensions in Russia and do you have any concerns that past in the future LNG exports to western countries could be under sanctions with in the future, I mean is that a possibility do you think or do you have any concerns around counterparty risk?

No, we’ve first of all where a company where would always be sanctions compliance, so it's important for us to look carefully into these matters and we haven't discovered any breach of sanctions and in the contracts that we have. And we believe that in particular gas is extremely important for Europe. Russia is one of the biggest suppliers of gas to Europe and if gas were to be sanctioned that would be a big problem for Europe in our opinion. So we don't think that it's realistic that gas exports would be sanctioned. And when we look at general counterparty risk we think that Gazprom is one of the big gas giants out there with a tremendous amount of infrastructure when it comes to Yamal LNG as you particularly asked about this is an international joint venture between Total, Novatek, CNPC and the Silk Road Fund which jointly must be some of the biggest players in the industry. So we believe that we have very strong counterparties and yes we do not believe that there will be sanctions affecting our charters.

Okay, thank you and that was helpful. Just also just wanted to get clarification on dry-docking. You said you're not expecting dry-docking and special surveys for another five years, so what about the other three vessels in the fleet the Yenisei River, Lena River and the other one Clean…

The Arctic Aurora?

Yes, Arctic Aurora, I’m sorry, are they going to go through special surveys next year or are they done and when you said five years are you referring to just the three that just went through dry-docking or/and the other three remaining has to go dry-docking next year or are you clear for the next five years?

No, what we meant was we were clear for the next five years for the three vessels that underwent dry dock now, we have another three dry docks next year. And as I said before, we should expect in the next quarter a charge of, for the one vessel which completed its dry dock in the third quarter there should be a small charge in that quarter.

I see, so next year just for modelling purposes should we be expecting dry-docking in the second quarter of 2018 as well, all in one quarter?

That's right. Yes.

Okay, perfect. Thank you so much. That’s it from me.

Thank you very much, ma'am. And your next question from Jefferies comes from the line of Randy Giveans. And your line is now open sir.

Hey guys, thanks for the time. I just have a few quick modelling questions and then one kind of a strategy question. So following up on Hillary’s questions here for the Amur River, how many days for the dry docking were in 2Q versus 3Q, I know you said you started in 2Q and ended this quarter?

Well, they're evenly split. I mean, all the dry docks, they took about 15 days on average per vessel, so I would say, I would say half in one quarter and half in the other quarter.

Okay, then looking at vessel OpEx, the 2Q average went up to about 13,720 a day and I know that includes some in technical maintenance expenditures for the dry docking, but outside of that what is a good run rate going forward knowing that the ship yard guarantees expired I guess in 2016?

Yes, I mean if you exclude the dry dock that wouldn't have been a material difference in the operating expenses versus other quarters. I think on average we should be talking around $12,000 for the steam turbine and maybe $13,000 for the diesel fuel, the dual fuel vessels.

Okay and then I guess the strategy question obviously the coverage ratio was significant factor by the dry docking and it may not get about one through 2018 kind of in our model. So how long can it save a little one keeping the distribution at that $0.225 per quarter without having cut the distribution rates - that can you maintain that obviously it’s been 1.4 so all throughout 2016 so, is that enough savings to kind of keep the distribution at least constant through 2018?

Yes, yes as I mentioned before there's actually a disconnect in the distribution coverage ratio and our actual ability to pay distribution on a cash basis. I did mention that the distribution the way we are now is safeguarded for the near-term and that certainly includes 2018 and longer.

Okay, all right, well that’s it from me, thanks so much.

Thank you, sir. Now from Maxim Group, your next question comes from the line of James Jang and your line is open sir.

Good afternoon guys. I just had a quick question on the Vladivostok LNG plant, have you heard any news of that because I don’t think they’re going to start bunkering, but do you think that might get rekindled?

When you say Vladivostok LNG plant, I mean you mean the…

The Gazprom one.

Well the Sakhalin 1, yes. I mean and when you say bunkering, what do you mean LNG bunkering or?

Yes, so I mean, I don’t think - I don’t believe it is the Sakhalin 1, I think it was the Shelf 1 the Vladivostok 1, I think that was back in 2013, they started to plan for it, it was supposed to come online in 2018 and then they shelved it, I think in 2015 or 2016?

Oh yes, sorry I misunderstood your question. I think we’re talking about an already producing one. No we don’t have any news on what the status is.

Okay. With the Russian, with the power of Siberia pipeline that’s kind of being curtailed a bit, do you think there is going to be additional Arctic LNG explore capacity needed approximately in 2018 or are you guys kind of still keeping with the same model in terms of export demand just from Sakhalin and Yamal?

Yes, so I mean basically now we’re looking at the existing terminal which is the Sakhalin Energy Investment Company 1 and then from Yamal which is starting in October this year and if you’re referring to LNG exports beyond that from the Arctic, I mean there are discussions of additional projects. That is too early to discuss on a shipping level now we think that would be kind of 2018 discussion. But we know that there are specific projects being discussed for additional exports out of the Arctic.

Okay, great. And aside from the Arc-7s that are on order now, have you seen any upticks from the shipyards in terms of additional ice class LNG carriers?

No, we have not.

Okay. All right, great, that’s all I had. Thanks guys.

Thank you very much.

Thank you very much indeed and at this point there are no further questions. I should hand back to the speakers for closing remarks.

Well, thank you to everyone for your time and for listening in on our earnings call. We look forward to speak with you again on our next call. Thank you very much.

Thank you very much indeed gentlemen and with many thanks to our speakers today, that does conclude the conference. Thank you all for participating and you may now disconnect. Thank you, Mr. Lauritzen and Mr. Gregos, thank you.