Good day, and welcome to the KBR Second Quarter 2012 Earnings Conference Call hosted by KBR. This call is being recorded. [Operator Instructions] For opening remarks and introductions, I'd like to turn the call over to Mr. Zac Nagle, Vice President, Investor Relations and Communications. Please go ahead.

Thank you. Good morning, and welcome to KBR's Second Quarter 2012 Earnings Conference Call. Today's call is also being webcast and a replay will be available on KBR's website for 7 days at kbr.com. The press release announcing second quarter results is also available on KBR's website. Joining me today are: Bill Utt, Chairman, President and Chief Executive Officer; and Sue Carter, Executive Vice President, Chief Financial Officer. Before turning the call over to Bill, I would like to remind our audience that today's comments may include forward-looking statements reflecting KBR's views about future events and their potential impact on performance. These matters involve risks and uncertainties that could impact operations and financial results and cause our actual results to differ from our forward-looking statements. These risks are discussed in KBR's second quarter press release issued last night, KBR's Form 10-Q for the period ended June 30, 2012, and KBR's current report on Form 8-K. You can find all of these documents at kbr.com. Now I'll turn the call over to Bill. Bill?

Thanks, Zac, and good morning, everyone. During today's call, I'd like to cover a few key areas. First, I'll walk through a few key takeaways relative to our second quarter performance and make some brief comments on our updated 2012 earnings guidance. Second, I'll provide an update on several of our key prospects. And third, I'll highlight the dynamics we're seeing in our markets. For the second quarter, KBR delivered $0.70 per fully diluted share. Our performance was better than we had initially expected for Q2 but still generally consistent with our overall expectations for the full year 2012. We initially expected that second quarter earnings before taxes would be a bit better than the first quarter. Our actual results were a fair amount better than those expectations for a number of reasons, a few of which I'll touch on here. First, as we noted in our Q2 earnings release issued last night, we've seen stronger execution during the quarter on several projects in construction or commissioning, which has allowed us to reduce our forecast cost estimates to complete these projects. Additionally, as we close out these projects, we hope to be able to resolve several outstanding issues on these projects, which may present further opportunities for KBR. Second, we've made good progress and have seen scope growth on our other projects beyond our initial expectations as well as realized achievements on several projects we had expected to recognize later in 2012. These projects are progressing well and KBR's execution has been consistently strong. Third, we've maintained our focus on disciplined cost controls across KBR and recognized notable benefit versus forecast in the quarter. In conjunction with this, we've lowered our guidance on corporate G&A to approximately $230 million from our previous guidance of between $240 million and $250 million.…

Thanks, Bill, and good morning, everyone. Our press release discussed revenue and job income of 2% and 4% year-over-year without LogCAP. Corporate G&A is also down 10% year-over-year and operating cash flow is up $50 million for the same period. On a sequential basis, revenue and job income are up 5% and 9% without LogCAP. Corporate G&A is down 5% and operating cash improved $55 million. Let's spend a few minutes walking through some of the more significant financial items in the quarter, and I will provide some color on how to think about a number of the key areas that are important takeaways from our call. The first is corporate general and administrative expenses. As we've highlighted previously, disciplined management of our overhead cost is a major focus for KBR. Corporate overhead in the second quarter was $52 million, down $6 million or 10%, driven by improvements in a number of areas with the most significant improvement in IT and real estate. As we look forward to the second half of 2012, we expect our continued focus on prudent cost control will enable us to drive incremental improvement versus our original guidance range of $240 million to $250 million. We now expect 2012 corporate G&A to come in at approximately to $230 million, a reduction of $10 million to $20 million versus our original guidance. The increase in corporate G&A versus the first half run rate will be driven by a ramp-up in ERP costs as expected, as well as costs associated with the expansion of our leadership team in Australia related to our newly created Group President Australia and Asia position. The second is our overall effective tax rate, which was 14% in the quarter, primarily due to favorable tax rate differentials on foreign earnings, statute expirations on…

Thank you, Sue. As we look at the KBR business, we think there is strength in diversity. We have 14 market-facing business units that give KBR a chance to play in a lot of different spaces. And while it's very difficult to have each of these businesses performing at peak market trends, it's also good to have several of them performing well at the same time, which is where I think we are today. While we do not believe we are firing on all cylinders today, we believe we've spread our bets reasonably well on a geographic basis, on an industry basis and on a customer basis. And I'm very pleased with the opportunity set I see in front of us as a result of this diversification. While we see some challenges ahead and we continue to have many moving parts in our portfolio, we also see several new and expanded opportunities emerging, coupled with the strong execution by the KBR team driving tangible financial results. As a result, we feel confident in updating our guidance range to $2.60 to $2.80 per share. We'll now open the call for questions. [Operator Instructions]

[Operator Instructions] And we'll take our first question from Andy Kaplowitz with Barclays.

Bill, maybe you could characterize the momentum of the Hydrocarbon markets versus last quarter because you talked about sort of a challenging booking environment, but also Hydrocarbon is better than expected. And we kind of know what the large projects are doing. So how does it look versus last quarter in the context of the global uncertainty that we're seeing out there?

Well, when we look at the projects, I think, we've been focusing on the beginning of the year, those larger ones have definitely moved to the right. I think we've been pretty nimble in moving tension to other parts of the value chain. Some of the success we've had in Downstream has been good. And we continue to see good bidding environments in Oil and Gas. Downstream we're reloading some of the proposals. But I'm optimistic with the continued evolutions of our markets, particularly in North America, where we could see some growth there. Technology continues to be strong, and our proposal volume there is up significantly since the end of last year. So we're really driving a lot of sales activity there. We've seen, obviously on the gas mon business, we've talked about a lot of the large prospects and I think they'll eventually go forward and I think we're well positioned for them. It's just a matter of when they get there. The other thing we've looked at, too, is we spent a lot of money on proposal budgets in the first half that we think is going to trend off a little bit in the second half, not that we're shying away from submitting proposals but we had a couple of fairly significant proposals in Oil and Gas and Downstream that we've been working on, also some of the continuing work in the gas mon business. So I think the bidding environment is -- for the next 6 months, I'm certainly more optimistic about what I see in the Oil and Gas side, and Downstream and Technology and in gas mon. But overall, given the portfolio of opportunities we're looking at both with the geographic diversification as well as the business universification, I feel that it's pretty positive and time will tell.

That's helpful, Bill. Shifting gears, just focusing on gas mon. Obviously, you had a strong quarter in margins. Maybe you could break out how much was the change in the cost-to-complete of the LNG project. And even if you can't, I guess, the question is are double-digit margins sustainable as you run off Skikda and Escravos, and then they are ending relatively soon, correct?

I think the bulk of the work will be finished on those projects by year end. We'll have some tail into 2013. But if you think about the revenues that were bringing from Skikda and Escravos, those were a pretty good portion of the revenues on gas mon. And as those expire, the lower margins that those projects have -- we've had historically will help lift the margins. The other thing we've got to think about, Andy, is we really haven't really achieved any cost-to-cost progress to date on INPEX Ichthys yet. And with that being an equity project, I really think the margins are going to easily be double-digit and will continue to expand. And really, the challenge will be how do we deal with Gorgon, where we've commented on the volumes that the margins that we're seeing on Gorgon. We are hitting the numbers that we expect. And then the equity contributions from Ichthys, that will drive that up. Now on the other side, if we get some of these other projects, where we're doing the full EPC, you may bring it down. But I think overall, that's good news because the overall margin dollars will be stronger if we're able to do that.

We'll take our next question from Joe Ritchie at Goldman Sachs.

So maybe just talking specifically, you gave us a lot of details on the projects and the opportunities. But maybe, Bill, you can kind of force-rank the opportunities over the next 6 months. Or do you really think your backlog is going to see opportunities for growth, I guess, across Canada? Some of the opportunities here on the shale side, I guess, the near-term opportunities will probably be on the ammonia plants. And maybe you can talk about the Middle East more specifically.

Boy, that's a tall order. I think I'm going to give up rank-ordering stuff because obviously if I had 20/20 foresight, we might have taken a different approach on some of the big elephants. What I will say, Joe, as we look at our proposal volumes in Canada, that's continuing to grow. I mean, the fact that we booked a lot of work does not mean we've exhausted all the projects we're chasing. In fact, we've seen quarter-over-quarter growth in the proposals outstanding in Canada. In the Middle East work, we've been looking at some of the -- some projects in Oil and Gas that we're very excited about. We're teaming with some contractors to bid EPC on scopes of work that allow us to take a little bit bigger share of a project than we previously have taken on some of the engineering only projects. I made some comments also about Shah Deniz, where we're hopeful that we have the opportunity to move into both the design and construction management of the onshore and offshore facilities, which is a little bit broader scope. We've talked in some of the prior announcements about our relationship with Höegh and the fact that we've looked at some projects with them engineering-wise offshore Israel as well as offshore Australia. In Downstream, it is a pursuit that we're looking at. The ammonia plants would be first to go. I think as we look at some of the ethylene plants, we'll see some opportunities for Services, where some of the players who have technologies that are differentiated from our technologies, we're looking at being a construction partner for them. So we're optimistic about some of the awards and, certainly, these are large awards because the plants are significant there. So from a U.S. standpoint, I'm thinking Downstream more towards ammonia, the U.S. Construction business should be very active. When you get into the Middle East, Oil and Gas and Downstream should continue to play there.

Okay. That's really helpful. And I guess, one follow-up question and maybe touching on Andy's question earlier on margins. You talked earlier about further opportunities on project closeouts. I was wondering if maybe you could help quantify. Or at least are the opportunities as large in the second half of 2012 versus what you were able to book in the second quarter of this year?

Well, I think there are areas that we believe are still out there. We've commented about some of the difficulties we had in administering the Skikda contract, when Sonatrach went through all of its personnel changes, and for a period of time, there really wasn't anybody for us to address on the other side of the table about issues that invariably arise on projects. And it's going to take us some time to work through those. And we still see those opportunities in front of us. I think that there will be some tough discussions, but I think we've got good positions as we've looked at the risk allocations from the initial contract. And I think that now that the situation is much more stable in terms of staffing as well as the stability of the people at Sonatrach, we'll be able to get some objective discussions and work back maybe some of the uncertainties that have arisen over the past couple of years.

We'll take our next question from Steven Fisher with UBS.

So your guidance suggests an earnings pickup in the second half. And I guess, you've got some SG&A and tax headwinds, but you mentioned some proposal cost tailwinds. Can you just tell us which of those fundamental areas within the business do you expect to ramp up in the second half versus the first half?

Well, I think the comments that we made in the script, Canada we're expecting to be better because of the burn rate on the sales that we've achieved this year. We're expecting Downstream to pick up in the second half. I made some comments about Power as the bookings they made last year are ramping up, and I'm referring principally to the SWA EPC project down in Florida. We also had a couple of one-time events the first half that adversely impacted the North American Government business that we're not expecting to repeat. We have the Tamimi case, where we had to take a $28 million charge, which we did in the second quarter. We 8-K-ed it in early May. We don't expect that to repeat. In fact, we think the logic was flawed and are appealing the judgment there. We did have a little bit of an offset on that, not a full offset but partial on -- it's not a LogCAP award but a recognition that we can recover overhead related to corporate facilities expenses according to Federal Acquisition Regulations on the LogCAP project. And so we will see a pickup in NAGL. I think we'll continue to see strong execution across the gas mon business and Technology.

Okay. That's helpful. And then on the ammonia plants, how should we think about the opportunity set for KBR in terms of technology licensing versus EPC? And I guess, with corn nearly $8, I mean, have you seen increased customer motivation for some of these plants in the last couple of months?

Well, I think the first part of your question, I think the Technology guys generally command about a 50% share of market on ammonia licenses, which we see no reason that, that should change. There's nothing that's happened in the market there. Our Downstream guys are obviously competing with international players on EP, so we're hopeful that we'll get our share. I don't suggest it's going to be 50% share of that market. I'd be very happy with 1 or 2 of the 12 that we're pursuing. In terms of the changes in the corn dynamics, I think in the past, we've talked about tracking 8 ammonia plants, now we're tracking 12. So the market does appear to be responding a bit. But we're trying to be very careful and thoughtful about how we pursue these projects and try to maximize our positions across those projects that we believe are going to go forward based on the merits of the project and spend less time on those that might be a little bit more speculative.

We'll take our next question from Jamie Cook from Credit Suisse. Jamie L. Cook - Crédit Suisse AG, Research Division: Two follow-up questions. One, Sue, with regards to the guidance range and what's implied in the back half of the year, can you just speak to what your assumptions are in terms of -- or do we expect -- do new projects have to hit for you to make your numbers? Or is it based on what you already have in backlog? And what the expectations are for the projects that have been pushed to the right? And then just one clarification, and I think I know the answer. But the $28 million charge that wasn't in your previous guidance, I want to confirm that. And then was it $10 million gain in your previous guidance? Because that speaks to what the earnings trajectory will be going forward.

Okay. Well, let me start out with the guidance and the new range. I think, Jamie, the way to think about it is when we look at the first half, and particularly the second quarter performance, we saw good performance coming out of a number of the projects in gas mon. And we obviously went through and overachieved on those. In the full year, as we had looked at some of the major projects, and in fact the comment we've made during the prepared remarks was that essentially our performance on projects today offset the projects that have moved to the right, so thereby balancing where we are from a guidance standpoint. I think that's all great news. And again, when you think about it and think back to what Bill had just said earlier, we've got businesses that are going to have a better second half from a revenue and margin standpoint with Downstream, with Technology, with Power and with our Canadian operations. And all of that helps solidify that piece of the puzzle. In terms of the Tamimi case... Jamie L. Cook - Crédit Suisse AG, Research Division: But wait, Sue, before we head to that, I understand the offset there. But there aren't any additional projects that you expect to hit that at this point aren't delayed, that are embedded in your second half guidance. I just want to make sure -- you know what I mean, that we don't have additional earnings risk on project that you think is going to move forward that hasn't been pushed to the right yet. You know what I mean?

No, no. Jamie L. Cook - Crédit Suisse AG, Research Division: So there's nothing -- so basically, you should be able to hit your numbers, assuming the projects that you have in backlog continue at the rate that you've projected?

Our new work expectations are normal in the second half.

They're very low because we only have 6 months left to book them and then burn them. Jamie L. Cook - Crédit Suisse AG, Research Division: That's very helpful. I just wanted to be clear. Sorry. And then go ahead, Sue.

Okay. And then on Tamimi, Tamimi would not have been in our guidance. It was a court ruling that came out in early May, as we announced. It certainly wouldn't have been what we expected. As we said, we're appealing the ruling on that. So that was not in any of our guidance numbers. And in terms of the $10 million, that was part of our incurred cost submissions. And that, just like anything else that's in the business, there are some things that are positive and some things that are negative. This one -- and we just happened to call that out for purposes of what we were looking for in the second quarter. But that $10 million relates to incurred cost statements for 2006 to 2009. And we're revising those incurred cost statements.

We'll take our next question from Scott Levine of JPMorgan. Scott J. Levine - JP Morgan Chase & Co, Research Division: So you're focusing on, Bill, some of the markets, it sounds like, that are not performing up to your hopes in the North American Government side and perhaps Minerals as well. And is the issue just your traditional government gridlock with regard to order flow or are your expectations that trends will improve there? And maybe some color with regard to what you're seeing on the Minerals side in terms of any slowdown from customers in response to recent commodity volatility?

Well, I think on the North American Government business I wouldn't call it gridlock-as-usual. I think there's a lot of uncertainty in the Pentagon right now regarding sequestration. Our proposal volumes at North American Government are 50% higher than they were at year end, outstanding proposals, which tells me people aren't acting on stuff. And there's a lot of -- and we see that in our unbilled. They're slow to react. I think there's a whole lot of creeping paralysis in terms of what does this mean to the broader defense community, given sequestration that's on the table. So that's why -- that covers a lot of my comments about the slowness in the North American business. Within the Minerals, we're still very optimistic about our work overseas and the opportunities we see in Australia and Indonesia and India. But I did make my comments around the impact that the shale gas has had on the North American coal industry, and that knock-on effect of the slowness in the coal industry as it affects the North American material handling business for Roberts & Schaefer. So that's what coloring down the Minerals outlook is our performance in the North American market, where we just see a much lower order flow. In fact, we've had awards that have been canceled that were disappointing to us that we can't do anything about, but that's just the state of the coal business and from our perspective in the North American market. Scott J. Levine - JP Morgan Chase & Co, Research Division: So outside that North American coal issue, broadly speaking, you're not seeing much of a slowdown throughout the world?

Where we are, which is, we see activity in India, we see Indonesia and Australia, we think it's as stable as it's been previously for us. Scott J. Levine - JP Morgan Chase & Co, Research Division: Got it. And then as my follow-on, you highlighted your last Investor Day new office openings in Australia, Angola, Kazakhstan. I mean, how are the new offices working? And are there other markets maybe that you're targeting that you aren't really active today that you may look to get more active in the future?

We did conclude the -- successfully, the Saudi office. We've had several awards, several hundred thousand hours of awards from Aramco under the GES+, so that's done as what we have expected. The Luanda office was instrumental in some of the offshore work we've won in Angola. We're opening the Baghdad office, as I mentioned. And if you'd like an invite to the office opening, I could arrange that for you. We talked about a Rio office and we're continuing to assess our best entry point there. We've had a gentleman down there for 4 months now that's been looking at office space and looking at prospects. So I think the objectives we set out in our Analyst and Investor Day regarding those, the 3 offices in Saudi, Iraq and Rio, I think we're on course for getting that execution done in 2012 as expected.

We'll take our next question from Will Gabrielski with Lazard.

Sue, I wanted to follow up on your cash comments. And maybe you could talk a little bit more about how much cash you actually view in the U.S. right now as available for repurchases and dividends every quarter? And then maybe some options you might have should you pursue M&A or a bigger buyback program or something to that effect? How willing you might be to use the balance sheet and maybe add some depth.

Well, I think as you think about the cash and you think about the piece that is onshore, all of that cash is going to be in various states. So for instance, some of it in our pooled category and is available to go through on the repurchases. I don't think we want to be specific about that because that's an opportunity for us to utilize and deploy our cash efficiently. I think what's important as you think about that 1/3 of the cash outside of the JV is being in the U.S. is, I talked about what is in unbilled receivables. That is primarily U.S. cash. And that is cash that we want to collect. That's an important element of how we run the business and that has to be first and foremost on our mind. Secondly, as we think about what's different about cash in the future, we do have cash that we can take out of some of our foreign operations. And in fact, in the 10-Q, we are going to routinely pay tax and bring back some of our Australia earnings as we move forward just because that's going to get to be a big part of our earnings. And then in terms of what else do you do in terms of acquisitions, if it's a U.S. acquisition, you obviously need U.S. cash. And certainly, we'd look at all of the different elements for that including debt. And if it's foreign, we'll use some of the foreign cash. So I think all the answers are pretty logical as you look at -- as how you would manage that cash in the future.

Okay. That's helpful. Then my follow-up, Bill, maybe you could walk through Gorgon a little bit. There's been some news about cost increases. And I know you're pretty well-inflated in your contracts. But I'm just wondering if there's been any major change in strategy around that project and timing on Gorgon 4 or not, and what you're doing maybe to help the project move along at this point?

Yes. Will, on Gorgon, obviously, it's a very complicated project, particularly from a logistics standpoint. First of all, as we look at the project, we're working towards getting Train 1 up and producing gas in 2014 as the original schedule has. And we've got our plans in place to drive some better productivity in the field to help us achieve that. We have seen some increased scope at KBR. I think some of the logistics that we had initially planned and the assumptions related to it were probably a little bit understated, so we've seen some additional work hours come to the project. We also are seeing a higher percentage of KBR people on the project, which has also given us a pickup in the IGP earnings that -- or our profit overhead recoveries that were better than we started the year with. Certainly, some of the aspects, when you look at a percent complete, some things are moving out in time. We still think that the volume that we have at Gorgon is going to continue for at present levels for a while. But I think it's still working forward. We've got a great working relationship with our integrated project management team, with Chevron. We're addressing all the various fronts of work. We've got some of the first modules that have been set on the island. We're largely out of the ground from a civil structural standpoint. And as we continue to knock those things off, we'll address other aspects, such as mechanical and the other elements related to the ultimate start-up of that project.

We'll take our next question from Tahira Afzal with KeyBanc.

My first question is really in regards to the underlying business outside of this very large projects. It seems, Bill, that you're pretty confident on really how those markets are shaping up, and you alluded to the 14 end markets in essence. So can you sort of reflect a bit qualitatively on as we look outside of 2012? And if some of the larger opportunities that you see out there sort of push more out on the right, how would the growth outlook look for KBR outside of those large projects?

Okay. Well, we've talked about some of the additional opportunities we're looking at in Oil and Gas, both around my comments on Shah Deniz and some of the work in the Middle East on projects with fabricators as well as the Höegh work. So there's a lot of opportunities we're seeing there for us. Downstream, we've talked about the opportunities in the U.S around shale gas but also the Middle East, and the recurrent work we're seeing there. Technology has been a good business, it has been growing 20%-plus a year for us for the last couple of years and we're comfortable that we're going to hit that mark again in 2012. As we look at our government businesses, we think they're in a decline for obvious reasons as the war efforts slow down. And as a result, we're probably not going to report our guidance for LogCAp next year because I think it's gotten to a point where it's immaterial. We are optimistic from where we sit today about our P&I business, Power and Industrial. We had a lot of good bookings last year that are working their way into the P&L over the next couple of years. We've got a series of bids that we're working on, and we feel good about the bids. And I do think that P&I can be a much different organization size-wise than it is today and continues to grow just based on the success they've enjoyed over the last 18 months. Minerals, we're starting from a small platform. And so any growth we'll have in Minerals will be large in percentage terms. And I do think the skill sets that KBR brings in terms of complex logistics, remote location, harsh environment execution do play well in the Minerals market. And I think…

Okay. That's very helpful. Just a brief follow-up. Some of your peers and even yourselves at your Analyst Day talked a bit about Africa. And I know right now, the big opportunities you're looking at there are more LNG-oriented in a sense. But if you really look outside of China and India, how excited are you as of right now in Africa being a longer-term opportunity, maybe a couple of years or 3 years-plus out for you?

Well, I think just if you look back over the last couple of years in Africa, we don't think there's been a lot of work going forward. I think we will see work go forward -- obviously, the offshore Mozambique work is the most visible, but we'll see continued work releases in Angola for the offshore. We're still optimistic on the refinery. We think that Sonatrach, now that they've gotten a lot of their internal issues behind them, is going to probably resume doing projects in the upstream side. So we do see things working. I commented on some increased activity we're seeing in what is a relatively smaller office for KBR in South Africa. So it does appear there is some stuff going on, and we're happy to see Africa start showing signs of growth again. It's hard to call kind of where Nigeria will end up or where that will clear up. But I think it's still a lot of economic opportunity in Nigeria and eventually it will be seized upon by the government to create the wealth for their population that they're seeking to do.

We'll take our next question from Brian Konigsberg with Vertical Research.

My first question is on Oil and Gas. You talked about a lot of prospects there coming up. You had talked about becoming a bigger player in that business. I was just curious, you talked about partnering. Do you see that strategy as being one that's going to really kind of satisfy your ambitions? Or do you anticipate you're going to have to do something more, maybe increase M&A, purchase some assets? Maybe just give a little bit of color on that.

Well, I think we're looking at one step at a time of trying to grow the business. I've commented previously, it had been primarily a topside engineering design business, with some semi-submersible designs out of GVA. We do see good opportunities for us to collect additional economic rent doing EPC work through higher margins because of the risk we undertake, but also broader scopes of supply in terms of some procurement management as well as construction management. I think the efforts with Höegh do get us a play in some of the offshore LNG, floating LNG concepts. So we are really looking at taking the strengths of KBR and leveraging them into a broader array of opportunities that are typically larger and provide better opportunities for us. If we can get all that accomplished, I think I'll be very pleased in the next 3 or 4 years. In terms of buying stuff, we always are on the look to see what we can do to create value for our shareholders. But really, I think a lot of the opportunities we see today for us are on the organic side and we are applying our resources, as we described in the Investor and Analyst Day last year, towards maximizing our platform on projects, largely through our organic growth strategy.

Got you. And secondly, on Power, you talked about both building grassroot gas plants and also environmental retrofits as being a big opportunity. And you're seeing a lot of bidding and quoting activity. One of the large utilities yesterday talked about scaling back their CapEx largely due to, I guess, lower requirements that they see in regards to retrofit for environmental reasons. I'm just curious, have you seen a change in the opportunity on that market specifically? Maybe just a little color on what you're seeing there.

To answer your question, no, we haven't seen any real changes in our prospect versus the opportunity set. I know that when utilities announced a lot of their environmental needs under the MACT and some of the other rules that were talked about by EPA, you had TVA talking about $20 billion of expenditure. I think AEP, Duke, Southern all had very large amounts of dollars. And even if some of the utilities are starting to scale back a little bit, it's still starting from a very, very large number when you look at the North American fleet. And we also see combined cycle plants as being a pretty good opportunity for us. When we look at just on the -- we're kind of working on 3 proposals right now in Power and 2 of them are environmental and 1 is a combined cycle. So I think that market is still strong. I think there's a lot of work to be done. And I think people still are going to be looking for ways, not just the utilities but I think in terms of a broader group, to continue to find ways to keep coal relevant in the U.S. in an environmentally acceptable fashion.

We'll take our next question from George O'Leary of Tudor, Pickering. George O'Leary - Tudor, Pickering, Holt & Co. Securities, Inc., Research Division: Just a quick LNG question. Kind of given KBR's global footprint within the LNG subsector, could you talk about which LNG markets from a geographic standpoint you guys feel are more attractive than others over the next, say, 12 to 18 months? And maybe you bucket those between the U.S. versus Canada and Australia, and then some of the African projects that may move forward.

The next 12 to 18 months, let's say Australia and the U.S. would be my top picks, just given the maturity of the developments. We've talked for sometime about Browse and Pluto. There's also Arrow, Gorgon 4. In Canada, we talked about the 3 projects we're involved in, in British Columbia. I think the U.S. is a little bit further behind. First, I believe that all the gas in Canada is considered as being stranded and is not going to find its historical market in the U.S. because of what we're turning over in the U.S. markets for shale. And then I still think you'll still have some discussion between the government and the tension between the American manufacturing association that will want to keep all the gas for the manufacturers here versus the constituencies that will want to export it. I think that debate is a little different here than what you see in Canada, which has always been an exporter of energy. So those are the top -- so U.S., Canada, are the top 2. I'd say much longer-term, U.S. -- excuse me, Australia and Canada are the top tier and then the second tier would be U.S. and East Africa. George O'Leary - Tudor, Pickering, Holt & Co. Securities, Inc., Research Division: Okay. That's very helpful. And then you mentioned shale, just kind of following on with that and talking about kind of a robust Downstream market. Is there any incremental opportunity within the refining space, given what we're seeing from light shale oil production in places, like the Bakken and maybe the Eagle Ford? You're seeing more of that light oil, that condensate come online. Is there any opportunity there within maybe potentially doing some refinery work?

I think there might be, but that's more of a theoretical comment based on the opportunity. And anything we're looking at today, George, is not of a magnitude that is on our screen as being unique and high-potential. George O'Leary - Tudor, Pickering, Holt & Co. Securities, Inc., Research Division: Okay. So no proposal out there yet?

I mean, we may have some, but certainly not that I'm aware of and that it would be of a magnitude worth talking about in this form.

And due to time constraints, that was our last question for today. I'd like to turn the conference back over to Bill for any concluding remarks.

I'd like to thank all of you for the attention to our call today. We appreciate the questions and interest in KBR. And if you have further questions, I think Zac and Rob will have time today to help address any questions we couldn't get to on the hour that we were allotted. But thank you very much for joining us and we look forward to our call next quarter. Thank you.

And that does conclude today's conference. Again, thank you for your participation today.