HOUSTON, Jul 12, 2010 (BUSINESS WIRE) -- Diamond Offshore Drilling, Inc. (NYSE:DO) today announced that a subsidiary of the Company has agreed to suspend a Gulf of Mexico (GOM) contract and has entered into a new multi-well international commitment with a subsidiary of Murphy Exploration and Production Company that will result in the relocation of the dynamically positioned, deepwater drilling rig Ocean Confidence to the Republic of Congo. The rig departed the GOM over the weekend and is expected to arrive on location offshore Africa within approximately 60 days.

Diamond Offshore President and CEO, Larry Dickerson, noted, "As the uncertainty about continued deepwater drilling in the GOM persists, we must consider alternatives that allow our deepwater assets to remain employed. The contract we suspended with Murphy has been restructured into a one-year commitment in the GOM that is expected to recommence when our customer is satisfied that it can obtain the necessary permits and can meet any new regulatory requirements."

The new international contract is a three-well commitment, plus an option for additional work, and includes an obligation for the customer to mobilize the rig to and from the Republic of Congo. The remaining one-year Gulf of Mexico commitment and new international commitment are expected to generate combined maximum total revenue of approximately $234 million.

Diamond Offshore provides contract drilling services to the energy industry around the globe and is a leader in deepwater drilling. Maximum contract revenue as stated above assumes 100% rig utilization. Generally, rig utilization rates approach 95-98% during contracted periods; however, utilization rates can be adversely impacted by additional downtime due to unscheduled repairs, maintenance and weather. Additional information on Diamond Offshore Drilling, Inc. and access to the Company's SEC filings is available on the Internet at www.diamondoffshore.com.

Statements contained in this press release which are not historical facts are "forward-looking statements" within the meaning of the federal securities laws. Forward-looking statements are inherently uncertain and subject to a variety of risks that could cause actual results to differ materially from those expected by management of the Company. A discussion of the important risk factors and other considerations that could materially impact these matters as well as the Company's overall business and financial performance can be found in the Company's reports filed with the Securities and Exchange Commission and readers of this release are urged to review those reports carefully when considering these forward-looking statements. Copies of these reports are available through the Company's website www.diamondoffshore.com. Given these risk factors, investors and analysts should not place undue reliance on forward-looking statements. Any such forward-looking statements speak only as of the date of this press release. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement to reflect any change in the Company's expectations with regard thereto or any change in events, conditions or circumstances on which any forward-looking statement is based.

SOURCE: Diamond Offshore Drilling, Inc.

Diamond Offshore Drilling, Inc. 
Les Van Dyke, 281-492-5370 
Director, Investor Relations

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