At approximately 1200 central time, a Piper PA-31-350 was damaged in an in-flight engine fire while in cruise flight near near Kerrville. The pilot said the airplane was approximately 25 miles out when the right engine lost power. He shut down the engine and landed without incident. Post-flight examination showed oil from the right propeller aft to the right vertical stabilizer. The outboard portion of the right flap, the right gear door and the right wing locker were destroyed by fire. In addition, there was thermal deformation of the aft right wing spar.