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Now I'll turn the call over to Mr. Bill Utt. Bill?William P. Utt Thanks, Rob, and good morning, everyone. Overall, I am pleased with KBR's execution and progress across our businesses. KBR's third quarter net revenue was in line with our expectations, and excluding the LogCAP project, is up 5% year-over-year. Now I would like to talk about some of the unusual accounting and tax impacts arising in the third quarter. During the third quarter, as a result of a scheduled reforecast of the remaining work on the Gorgon project, we increased our forecast man-hour backlog for the work we expect to perform over the remainder of the project. This backlog increase reduced the project's percentage of completion, and as a result, reduced our job income on the project. This reduction in job income was offset in part in net income attributable to noncontrolling interest. These amounts will be recovered over the remaining life of the project. Also during the third quarter, KBR received notice of an arbitration award of approximately $193 million in the Barracuda Caratinga arbitration. This award, for which KBR is indemnified by our prior parent, created a book tax benefit for KBR in the amount of $68 million. The award will be tax deductible by KBR when the award is paid. The indemnity payments to KBR are treated as a nontaxable contribution to capital for tax purposes. Finally, during the third quarter, KBR received information from the Australian receiver controlling our former investment in an Australian railroad venture, which allowed us to release a $24 million deferred tax liability related to our share of the Australian railroad investment. As a result of these impacts, as well as the continuing strength of our business, our 2011 guidance is $3.15 to $3.30 per share. Now let's talk about KBR businesses. KBR's backlog at September 30 was $11.7 billion. Compared to the prior year third quarter, KBR's job income backlog has increased 11%, while revenue backlog is down 5%. Compared to the last quarter, job income backlog increased 1% despite a 2% revenue backlog decline.
Approximately 75% of the revenue backlog decline this quarter was related to a reforecast of the Escravos' estimate to complete, and FX impacts. Quarter-over-quarter, Hydrocarbons' backlog declined $674 million primarily due to project work off. IGP's backlog was up $313 million, led by work additions on the LogCAP III and IV projects, including $300 million of definitized work for our Base Life Support task order for the Department of State's mission in Iraq, as well as the award of a construction services contract for the Plant Radcliffe coal gasification project in Mississippi. Services backlog increased $21 million from the second quarter as a result of the Plant Scherer and other U.S. construction project awards. We also continue to see increased activity at our North American-focused businesses.Now I would like to comment on a few of our projects. In Australia, KBR and our partners remain actively engaged in post-FEED and pre-FID activities on the impacts of this LNG project, and the open book tender discussions continue to proceed towards a fourth quarter 2011 FID. At the Pluto LNG project, KBR continues to provide support to Woodside on the Pluto foundation project on an as-needed basis and is currently performing various additional studies on the proposed expansion project. At the Browse LNG project, the FEED is wrapping up, and we expect to move to a big quality FEED extension during the fourth quarter. Permitting and industrial relations activities are ongoing, and the project continues to anticipate a 2012 FID. Read the rest of this transcript for free on seekingalpha.com