UPDATE 1-Teekay Offshore says secured $260 mln credit facility

* Says facility secured by Petrojarl Varg

* Says to repay $160 mln of vendor financing

* Says to increase liquidity by $100 mln

Nov 12 (Reuters) - Teekay Offshore Partners LP (TOO.N) said it had signed a $260 million revolving credit facility secured by a floating production storage and offloading unit which it had bought from its parent company Teekay Corp (TK.N).

Teekay Offshore, whose tankers are used to transport oil from offshore fields to onshore processing facilities, said a portion of the facility will be used to repay $160 million of $220 million vendor financing provided by Teekay Corp at the time of acquisition of the unit, Petrojarl Varg FPSO.

The remaining $60 million financing will remain outstanding, while the undrawn portion of the facility will increase Teekay Offshore's liquidity by about $100 million, it added.

Teekay Offshore acquired Petrojarl Varg FPSO from Teekay Corp for $320 million in September.

The unit had commenced a four-year fixed-rate contract extension with Talisman Energy Inc (TLM.TO) on the Varg oil field in the North Sea.

Units of Teekay Offshore closed at $17.20 Wednesday on the New York Stock Exchange.

For the alerts, please double click [ID:nWNAB4995] (Reporting by Arup Roychoudhury in Bangalore; Editing by Jarshad Kakkrakandy)