Ladies and gentlemen, if you would like to ask a question please press “*1” on your touch-tone phone. If your question has been answered and you would like to withdraw you may press “*2”. Please press “*1” to begin and our first question will come from the line of Andrew Kaplowitz with Lehman Brothers. Please proceed.

Andrew Kaplowitz - Lehman Brothers

Good morning guys.

Bruce W. Wilkinson

Good morning.

Michael S. Taff

Good morning.

Andrew Kaplowitz - Lehman Brothers

So, in the J. Ray business, you talked about, having to take some extra marine days on specific projects. Bruce, what are you doing to try and alleviate what look like some bottlenecks because you''ve had the ramp-up so quickly, is there anything that you could do over time to sort of ease the stress in the system?

Bruce W. Wilkinson

There are a number of things, Andy, and we''re working on all of them. First, I should characterize it as...it''s really a lot of projects at the same time fortuitously in the same geography, primarily in the Mid-East. And so, in the Mid-East, historically, J. Ray had one permanent vessel, the DB27 and from time-to-time we would move in the KP1 or the DB30 out of Asia. Now, we have all three of those, plus DB101, as well as some of the Secunda vessels, all in that one geography. And so, fortuitously earlier slippages on projects forced an inordinate amount of activity at one time in one place. We are working with the customers, which when you see things like revenues moving to the right or slippages, sometimes...and we have a number of projects where frankly we could stay the course and in the end, we might be late, but we would still be ahead of the onshore activity of the customer, for instance, at a LNG or GTL facility.

And so that being the case, in other words, to complete wellheads for which there is no terminal doesn''t make sense for them or us. So, we are working with them in some cases to move them out of the quarter and in some cases out of the year. The other thing we have done in a couple of instances is here therefore, the McDermott strategy has been to implement its projects through its owned assets and that has always been the way we''ve done it with the exception of cargo barges and things like that, but as far as the lay barges and heavy-lift barges it''s essentially been through our own footprint. And so and that''s not necessarily the way all companies do it. You can look at some marine contractors make a liberal use of chartered vessels, or if not so for instances Secunda vessels were chartered to some of our competitors from time to time. And so we''ve a couple of instances where we are looking at or have looked at or actually contracted someone else''s barge on charter to bring in to alleviate some of the blockage.

So, we are working all the issues. We are not sitting idly by and hoping it goes away, but it is...it does have some challenges; it does have some bottlenecks. One final comment I might make it''s a longer term fix, it will hopefully began in ''09, hopefully help one of the CapEx decisions that was recommended by J. Ray, approved by the Board was to go ahead and actually acquire a shallow water lay barge that would be used long term in the Mid-East because what happens is much of this activity there it''s not just offshore, it''s close end of the beach. It''s the beach falls, there is a lot of work in congested areas, and so that is, we have not typically...our barges are not typically suited to that. We are more in the mid-to-deeper water and because we saw through the Saudi LTA opportunity and other projects that we think will have a continuum for years to come, we believe it was in our best interest to maybe go ahead and add something like that to the fleet, and that is ongoing as we speak today, but will be more of mid-to-late ''09, it will come into the fleet there. So, essentially we are working it daily, and I think we will continue to improve the situation, but there is no question, we have a lot of activity in the water, and in some cases in the very same water. Is that--?

Andrew Kaplowitz - Lehman Brothers

Yeah, and that''s definitely helpful, Bruce. Do we get more comp...or can we have more comps instead you will be able to reach your backlog burn estimates that we see for the rest of the year, I mean are we getting closer to where you''ve sort of figured out what things will be in 2008 and what things will not?

Bruce W. Wilkinson

Well, I would say that we, certainly compared to the first quarter, the second quarter would indicate we are gaining on it, but we didn''t get there, and I think it still has challenges. I would hope that we continue...I think it''s...there''s not any miracle overnight of fix, it just makes it next week to come out perfect. I think all those things I mentioned incrementally get us going in the right direction, and I believe we are getting there but it is a challenge.

Andrew Kaplowitz - Lehman Brothers

Got you...

Bruce W. Wilkinson