domestic land revenue. Most of the Gulf of Mexico revenue decrease is from reduced demand for drill pipe, specialty tubulars, stabilization equipment and accommodations. We view much of the decline as temporary because it came from the deepwater markets, where several projects were in transition. In the domestic land markets, rentals of accommodations increased while rentals of stabilization equipment and drill pipe were lower. Our income from operations as a percentage of revenue decreased to 18% from 20% due mainly to business mix, with a larger percentage of our revenue coming from the lower-margin accommodations business as compared with the prior quarter.
In our marine segment, revenue was $31.3 million and income from operations was $5.1 million. These represent increases of 14% in revenue and 4% in income from operations as compared with the second quarter of 2009. The increase is primarily attributable to seasonal increases in activity as utilization increased to 62% from 53% in the second quarter of 2009. In addition, we had a full quarter contribution from both of our 265-foot class liftboats. Dayrates decreased for most of our liftboats.
We anticipate activity in both the domestic land and Gulf of Mexico markets will decrease during the winter months as seasonal factors, including weather, holiday downtime and the desire of our customers to curtail spending during this period, will reduce activity levels in these markets across the majority of our product and service lines during the fourth quarter of 2009 and into the first quarter of 2010.
Comparison of the Results of Operations for the Three Months Ended September 30, 2009 and 2008
For the three months ended September 30, 2009, our revenues were $386.5 million, resulting in a net income of $24.4 million, or $0.31 income per share. Included in the results for the three months ended September 30, 2009 were $6.2 million of non-cash losses from equity-method investments that include $1.5 million of our share of unrealized losses associated with mark-to-market changes in the value of outstanding hedging contracts put in place by SPN Resources and $4.7 million of other non-cash charges related to SPN Resources. For the three months ended September 30, 2008, revenues were $490.3 million and net income was $97.3 million, or $1.19 diluted earnings per share. Included in the results for the three months ended September 30, 2008 were $23.2 million of earnings from equity-method investments, which included $19.2 million of pre-tax gains associated with our share of mark-to-market changes in the value of derivative contracts put in place by SPN Resources. Revenues for the three months ended September 30, 2009 were lower in the well intervention segment due to a decrease in work related to a large-scale decommissioning project as well as a decrease in domestic land revenue. Revenue also decreased in the rental tools segment primarily due to decreased rentals of accommodations and stabilization equipment in our domestic land markets. During the three months ended September 30, 2009, revenue in our marine segment decreased due to lower utilization. The following table compares our operating results for the three months ended September 30, 2009 and 2008 (in thousands). Cost of services, rentals and sales excludes depreciation and amortization for each of our business segments.

                                     Revenue                                     Cost of Services, Rentals and Sales
                       2009           2008           Change          2009           %           2008           %          Change
Well Intervention    $ 254,335      $ 319,798      $  (65,463 )    $ 160,237        63%       $ 168,903        53%       $  (8,666 )
Rental Tools           100,832        136,600         (35,768 )       36,211        36%          46,422        34%         (10,211 )
Marine                  31,288         33,884          (2,596 )       19,226        61%          21,285        63%          (2,059 )

Total                $ 386,455      $ 490,282      $ (103,827 )    $ 215,674        56%       $ 236,610        48%       $ (20,936 )

The following provides a discussion of our results on a segment basis:
Well Intervention Segment
Revenue from our well intervention segment was $254.3 million for the three months ended September 30, 2009, as compared to $319.8 million for the same period in 2008. Cost of services percentage increased to 63% of segment revenue for the three months ended September 30, 2009 from 53% for the same period in 2008. Our decrease in revenue and profitability is primarily attributable to a decrease in revenue from the domestic land markets related to coiled tubing and cased hole wireline, snubbing and well control services. Additionally, we performed less work associated with the large-scale decommissioning project in the Gulf of Mexico. Our largest geographic revenue decrease in this segment came from our domestic land markets, which decreased 44% to approximately $49.2 million for the quarter ended September 30, 2009 over the same period in 2008.
Rental Tools Segment
Revenue from our rental tools segment for the three months ended September 30, 2009 was $100.8 million, as compared to $136.6 million for the same period in 2008. Cost of rentals and sales percentage slightly increased to 36% of segment revenue for the three months ended September 30, 2009 from 34% for the same period of 2008. The decrease in rental revenue is primarily related to a decrease in the rentals of our accommodation units and stabilization equipment, specifically in the domestic land market. Rental revenue in our domestic land market decreased 53% to approximately $22.2 million for the quarter ended September 30, 2009 over the same period in 2008. Additionally, rental revenue generated from the Gulf of Mexico and our international markets decreased by 15% and 9%, respectively, for the quarter ended September 30, 2009 over the same period in 2008.
Marine Segment
Our marine segment revenue for the three months ended September 30, 2009 was $31.3 million, an 8% decrease over the same period in 2008. Our cost of services percentage decreased to 61% of segment revenue for the three months ended September 30, 2009 from 63% for the same period in 2008 primarily due to decreased liftboat maintenance costs and direct expenses. The fleet's average utilization decreased to approximately 62% for the third quarter of 2009 from 81% in the same period in 2008. The utilization decrease was offset by an increase in the fleet's average dayrate, which increased 19% to approximately $16,300 in the third quarter of 2009 from $13,700 in the third quarter of 2008. The increase in average dayrate was primarily due to the addition of two 265-foot class vessels in the second quarter of 2009. Depreciation and Amortization
Depreciation and amortization increased to $52.7 million in the three months ended September 30, 2009 from $44.8 million in the same period in 2008. Depreciation and amortization expense related to our well intervention and rental segments for the three months ended September 30, 2009 increased approximately $7.4 million, or 18%, from the same period in 2008. The increase in depreciation and amortization expense for these segments is primarily attributable to our 2009 and 2008 capital expenditures. Depreciation expense related to the marine segment for the three months ended September 30, 2009 increased approximately $0.4 million, or 15%, from the same period in 2008. The increase in depreciation expense for the marine segment is primarily attributable to the delivery of two new 265-foot class liftboats partially offset by the decrease in utilization, as liftboats are depreciated primarily on a units of production basis.
General and Administrative Expenses
General and administrative expenses decreased to $63.4 million for the three months ended September 30, 2009 from $68.4 million for the same period in 2008. The decrease is primarily related to our efforts to reduce expenses during this difficult market coupled with a decrease in insurance and bonus expense based on decreased revenue and profitability.

Comparison of the Results of Operations for the Nine Months Ended September 30, 2009 and 2008
For the nine months ended September 30, 2009, our revenues were $1,184.7 million, resulting in a net income of $12.3 million, or $0.16 income per share. Included in the results for the nine months ended September 30, 2009 were non-cash, pre-tax charges of $92.7 million for the reduction in value of intangible assets and $36.5 million for the reduction in value of our remaining equity-method investment in BOG. Also included in the results for the nine months ended September 30, 2009 were losses of $14.0 million from our share of BOG, $8.9 million of our share of unrealized losses associated with mark-to-market changes in the value of outstanding hedging contracts put in place by SPN Resources and $4.7 million of other non-cash charges related to SPN Resources. For the nine months ended September 30, 2008, revenues were $1,389.3 million and net income was $268.2 million, or $3.27 diluted earnings per share. Included in the results for the nine months ended September 30, 2008 were $40.9 million of pre-tax gains associated with the sale of businesses. Revenue for the nine months ended September 30, 2009 was lower in the well intervention segment due to a decrease in domestic land revenue. Revenue also decreased in the rental tools segment primarily due to decreased rentals of accommodations and stabilization equipment in our domestic land markets. During the nine months ended September 30, 2009, revenue in our marine segment decreased primarily due to lower utilization. No activity was recorded in our oil and gas segment for the nine months ended September 30, 2009 as we sold 75% of our interest in SPN Resources on March 14, 2008.
The following table compares our operating results for the nine months ended September 30, 2009 and 2008 (in thousands). Cost of services, rentals and sales excludes depreciation, depletion, amortization and accretion for each of our business segments. Oil and gas eliminations represent products and services provided to the oil and gas segment by our other segments.

                                       Revenue                                       Cost of Services, Rentals and Sales
                        2009             2008            Change          2009           %           2008           %          Change
Well Intervention    $   773,513      $   850,804      $  (77,291 )    $ 473,240        61%       $ 462,783        54%       $  10,457
Rental Tools             329,309          401,700         (72,391 )      111,549        34%         131,857        33%         (20,308 )
Marine                    81,903           82,964          (1,061 )       50,618        62%          56,411        68%          (5,793 )
Oil and Gas                    -           55,072         (55,072 )            -         -           12,986        24%         (12,986 )
Less: Oil and Gas
Elim.                          -           (1,212 )         1,212              -         -           (1,212 )       -            1,212

Total                $ 1,184,725      $ 1,389,328      $ (204,603 )    $ 635,407        54%       $ 662,825        48%       $ (27,418 )

The following provides a discussion of our results on a segment basis:
Well Intervention Segment
Revenue of our well intervention segment was $773.5 million for the nine months ended September 30, 2009, as compared to $850.8 million for the same period in 2008, representing a 9% decrease. Cost of services percentage increased to 61% of segment revenue for the nine months ended September 30, 2009 from 54% for the same period in 2008. Our decrease in revenue and profitability is primarily attributable to a decrease in revenue from the domestic land markets related to coiled tubing and cased hole wireline, snubbing and well control services. Accordingly, our largest geographic revenue decrease in this segment came from our domestic land markets, which decreased 38% to approximately $162.7 million for the nine months ended September 30, 2009 over the same period of 2008. Partially offsetting this decrease was an increase in revenue generated in our Gulf of Mexico market. Revenue in the Gulf of Mexico increased approximately $17.3 million, or 4%, for the nine months ended September 30, 2009 over the same period in 2008 primarily due to the increase in level of work associated with various well control projects and plug and abandonment work.

Rental Tools Segment
Revenue of our rental tools segment for the nine months ended September 30, 2009 was $329.3 million, an 18% decrease over the same period in 2008. Cost of rentals and sales percentage increased slightly to 34% of segment revenue for the nine months ended September 30, 2009 from 33% for the same period in 2008. The decrease in rental revenue is primarily related to a decrease in the rentals of our on-site accommodation units and stabilization equipment, specifically in the domestic land market. Rental revenue in our domestic land markets decreased 37% to approximately $85.7 million for the nine months ended September 30, 2009 over the same period in 2008. Additionally, rental revenue generated from the Gulf of Mexico and our international markets decreased by 7% and 9%, respectively, for the nine months ended September 30, 2009 over the same period in 2008.
Marine Segment
Our marine segment revenue for the nine months ended September 30, 2009 was $81.9 million, a 1% decrease over the same period in 2008. Our cost of services percentage decreased to 62% of segment revenue for the nine months ended September 30, 2009 from 68% for the same period in 2008 primarily due to decreased liftboat maintenance costs and direct expenses. The fleet's average utilization decreased to approximately 55% for the nine months of 2009 from 63% in the same period in 2008. The utilization decrease was offset by an increase in the fleet's average dayrate, which increased 12% to approximately $16,900 in the nine months of 2009 from $15,100 in the nine months of 2008. The increase in average dayrate was primarily due to the addition of two 265-foot class vessels in second quarter of 2009.
Oil and Gas Segment
On March 14, 2008, we sold 75% of our interest in SPN Resources for approximately $167.2 million. SPN Resources represented substantially all of our operating oil and gas segment. Subsequent to March 14, 2008, we have accounted for our remaining interest in SPN Resources using the equity-method. Depreciation, Depletion, Amortization and Accretion Depreciation, depletion, amortization and accretion increased to $153.6 million in the nine months ended September 30, 2009 from $128.7 million in the same period in 2008. Depreciation and amortization expense related to our well intervention and rental segments for the nine months ended September 30, 2009 increased approximately $26.2 million, or 22%, from the same period in 2008. The increase in depreciation and amortization expense for these segments is primarily attributable to our 2009 and 2008 capital expenditures. Depreciation expense related to the marine segment for the nine months ended September 30, 2009 increased approximately $1.5 million, or 21%, from the same period in 2008. The increase in depreciation expense for the marine segment is primarily attributable to the delivery of two vessels partially offset by the decrease in utilization, as liftboats are depreciated primarily on a units of production basis. These increases were offset by the $2.8 million decrease in the oil and gas segment as we sold 75% of our interest in SPN Resources in March 2008. General and Administrative Expenses
General and administrative expenses decreased to $188.7 million for the nine months ended September 30, 2009 from $204.4 million for the same period in 2008. The decrease is primarily due to the sale of 75% of our interest in SPN Resources in March 2008 along with our efforts to reduce expenses during these difficult market conditions.
Reduction in Value of Assets
During the nine months ended September 30, 2009, we recorded approximately $92.7 million of impairment expense relating to our intangible assets within our well intervention segment. This reduction in value of intangible assets is primarily due to the decline in demand for services in the domestic land markets.
Additionally, we recorded a $36.5 million expense to write off our remaining investment in BOG, an equity-method investment in which we owned a 40% interest as of September 30, 2009. In April 2009, BOG defaulted under its loan agreements due primarily to the impact of pipeline curtailments from Hurricanes Gustav and Ike in 2008 and the decline of natural gas and oil prices. As a result of continued negative BOG operating results, lack of viable

interested buyers and unsuccessful attempts to renegotiate the terms and conditions of BOG's loan agreements, we wrote off the remaining carrying value of our investment in BOG.
Liquidity and Capital Resources
The recent and unprecedented disruption in the current credit markets has had a significant adverse impact on a number of financial institutions. At this point in time, our liquidity has not been impacted by the current credit environment. We will continue to closely monitor our liquidity and the overall health of the credit markets. However, we cannot predict with any certainty the impact of any further disruption in the credit environment.
In the nine months ended September 30, 2009, we generated net cash from operating activities of $176.9 million as compared to $308.7 million in the same period of 2008. This decrease is primarily attributable to the increase in costs and estimated earnings in excess of billings related to the large-scale decommissioning contract in the Gulf of Mexico, which is currently expected to be completed by the end of the first half of 2010. Included in other current assets is approximately $320.6 million at September 30, 2009 and $164.4 million at December 31, 2008 of costs and estimated earnings in excess of billings related to this project. Billings, and subsequent receipts, are based on the completion of milestones. We are working on several aspects of this project at the same time, so we continue to incur costs and recognize revenue in advance of completing milestones. Our primary liquidity needs are for working capital, capital expenditures, debt service and acquisitions. Our primary sources of liquidity are cash flows from operations and available borrowings under our revolving credit facility. We had cash and cash equivalents of $34.3 million at September 30, 2009 compared to $44.9 million at December 31, 2008. We spent $241.6 million of cash on capital expenditures during the nine months ended September 30, 2009. Approximately $101.0 million was used to expand and maintain our rental tool equipment inventory, approximately $56.0 million was spent on our marine segment and approximately $71.5 million was used to expand and maintain the asset base of our well intervention segment.
In April 2008, we contracted to purchase a 50% interest in four 265-foot class liftboats. The first two vessels were placed in service during April and May of 2009, and are currently working in the Gulf of Mexico. Construction on the two remaining vessels was suspended in March 2009, as a result of disputes with the builder. Those disputes have been resolved and the uncompleted vessels have been delivered to a different shipyard to be completed. We expect the remaining two vessels to be completed during the first half of 2011. In September 2009, we acquired the other 50% interest in the four liftboats for a total price of $38.1 million, following the other owner's exercise of an option requiring us to purchase its interest in these liftboats.
In May 2009, we amended our revolving credit facility to increase the borrowing capacity to $325 million from $250 million. Any amounts outstanding under the revolving credit facility are due on June 14, 2011. Costs incurred during the nine months ended September 30, 2009 associated with amending the revolving credit facility were approximately $2.3 million. These costs were capitalized and are being amortized over the remaining term of the credit facility. At September 30, 2009, we had $57.2 million outstanding under the bank credit facility. We also had approximately $12.1 million of letters of credit outstanding, which reduces our borrowing capacity under this credit facility. The current amounts outstanding on the revolving credit facility are primarily due to increased working capital needs for our large-scale decommissioning project. As of October 30, 2009, we had $29.5 million outstanding under the bank credit facility. Borrowings under the credit facility bear interest at a LIBOR rate plus margins that depend on our leverage ratio. Indebtedness under the credit facility is secured by substantially all of our assets, including the pledge of the stock of our principal subsidiaries. The credit facility contains customary events of default and requires that we satisfy various financial covenants. It also limits our ability to pay dividends or make other distributions, make acquisitions, create liens or incur additional indebtedness. At September 30, 2009, we had outstanding $14.6 million in U.S. Government guaranteed long-term financing under Title XI of the Merchant Marine Act of 1936, which is administered by the Maritime Administration (MARAD), for two 245-foot class liftboats. This debt bears an interest rate of 6.45% per annum and is payable in equal semi-annual installments of $405,000 on June 3rdand December 3rd of each year through the maturity date of June 3, 2027. Our obligations are secured by mortgages on the two liftboats. This MARAD financing also requires that we comply with certain covenants and restrictions, including the maintenance of minimum net worth, working capital and debt-to-equity requirements.

We have outstanding $300 million of 6 7/8% unsecured senior notes due 2014. The indenture governing the senior notes requires semi-annual interest payments on June 1st and December 1st of each year through the maturity date of June 1, 2014. The indenture contains certain covenants that, among other things, limit us from incurring additional debt, repurchasing capital stock, paying dividends or making other distributions, incurring liens, selling assets or entering into certain mergers or acquisitions. . . .