The ultimate demand for U.S. exports is still an unknown at this point. However, it is encouraging that there are over 100 million tons per annum of planned projects. However, it’s an open question how much of this will come online and when. If all the incremental gas does come online by 2020, we anticipate there will be a need for approximately an additional 170 LNG carriers. For this reason we are bullish on the long-term fundamentals of LNG shipping and believe Teekay LNG is well positioned to take advantage of this expected growth which will ramp beyond 2015.
Turning to slide number five, I will review our consolidated operating results for the quarter comparing an adjusted Q2 income statement against an adjusted Q1 income statement which includes the items listed in appendix say of our earnings release and reallocates realized gains and losses from derivatives to their respective income statement line item.
Net voyaged revenues decreased by $2.7 million mainly as a result of a scheduled dry docking of one of our LNG carriers during the second quarter. For the third quarter of 2012, no off hire from dry docking our schedule. Vessel operating expenses decreased slightly as a result of lower crew manning due to foreign exchange fluctuations. We expect higher vessel operating expenses next quarter due the timing of certain repairs and maintenance.
Depreciation and amortization remained relatively consistent from Q1 as expected. General and administrative expenses decreased by $600,000 due to the timing of expenses. Net interest expense increased by $1.1 million primarily due to interest expense related to the Norwegian Kroner bonds that we issued in May 2012. Equity income increased by $7.6 million primarily as a result of a full quarter of our income from our 52% interest in six LNG carriers which were acquired on February 28 as well as increase in the charter rate on the methane spirit which took effect in April.Read the rest of this transcript for free on seekingalpha.com
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