Ladies and gentlemen, thank you for standing by and welcome to the Noble Corporation Fourth Quarter and Full Year 2007 Earnings Conference Call. During the presentation, all participants will be in the listen-only mode. Afterwards we will conduct a question-and-answer session. [Operator Instructions]. As a reminder, this conference is being recorded, Thursday January 24, 2008. And I would now like to turn the conference over to Mr. Lee Ahlstrom, Vice President of Investor Relations and Planning. Please go ahead, sir.

Thank you, Dennis. Before we begin let me read our Safe Harbor statement for you. I will remind everyone that any statements we make today about our plans, expectations, estimates, predictions or similar expressions of the future are forward-looking statements and are subject to risks and uncertainties. Our filings with the U.S. Securities and Exchange Commission which are posted on our website discuss the risks and uncertainties in our business and industry, and the various factors which could keep outcomes of any forward-looking statements from being realized. Our actual results could differ materially from our expectations. We've included detailed balance sheet and income and cash flow statements with our earnings news release. Now I'll turn the call over to David Williams, our Chairman, President, and Chief Executive Officer.

Thanks Lee. Good afternoon to everyone and welcome to Noble's fourth quarter and full year 2007 earnings call. It is truly my privilege to be able to offer that welcome as the new CEO. I am excited and honored to be here and have the opportunity to lead what I consider to be one of the finest and most respected organizations in this industry. In spite of the eminent changes here, Noble's operations have been moving steadily forward. We think we delivered the kind of financial and operating results that you've come to expect from us. Many of you are long time shareholders and we truly appreciate your support through this time of transition. I can assure you that everyone in the company is continuing to work hard and moving the ball forward. I'm excited about the direction in which we are headed right now. I'd like to take a moment... just a moment to thank Bill Sears for his leadership as our Interim CEO during the fourth quarter. While he was in front of the investors all the time, everyone here at Noble that came in contact with Bill appreciated his style, his experience, and his commitment. Bill dove right in and got down with the attention [ph] with the rest of us and we all benefited from his brief tenure here. So, thank you very much, Bill. We've got the team assembled here for the call. I'm going to make a few opening remarks and Tom Mitchell, our CFO, will discuss the fourth quarter and full year results. Lee, our VP of Investor Relations and Planning, will give you some guidance on our upcoming year and then Kurt Hoffman, our Vice President for Worldwide Marketing will take us around the world and talk about demand. After that we'll…

Good afternoon everyone. Last evening Noble released record financials results for both the fourth quarter and the full year of 2007. For the fourth quarter, our net income was $347 million or $1.29 per diluted share on revenues of $832 million. This represents the ninth consecutive quarter in which Noble has announced record earnings. For the full year, Noble's net income was $1.2 billion or $4.48 per diluted share on revenues of almost $3 billion. Contract drilling revenues during the quarter were up $42 million or almost 6% to $761 million. 12 of our rigs moved to higher day rates generating $50 million in additional revenues. Now these revenues were offset by lower utilization quarter-on-quarter primarily due to the fire-related downtime on the Noble Roger Eason and an additional 129 days of stack time on our three submersibles. We do like to remind everyone that these three rigs are Noble's only exposure to the shallow water U.S. Gulf of Mexico market. Contract drilling expenses were also a positive story during the quarter. Sequentially, the increase was about 17 million or 7%, which is roughly the same increase we saw between the second and third quarters. On a per day basis, costs during the quarter were about $49,900; however, fourth quarter costs include $10 million attributable to the insurance deductible on the incident aboard the Eason. Excluding this incident, contract drilling expenses would have been about $47,800, an increase of only 2.6%. For the full year of 2007, you'll no doubt recall our guidance was to hold to a 15% increase in per day operating costs for the year versus our per day costs in the fourth quarter of 2006. Our fourth quarter 2006 daily contract drilling expenses were about $39,600 compared to about $49,400 for the full year of '07,…

Thanks Tom. As most of you know, we are still going through our final budget process and the 2008 budget numbers won't be official until our regularly scheduled board meeting in the 1st week of February. However, we understand that everybody wants to update their models and so I will give you some preliminary figures that you can use. You are aware of course that we issued a fleet status report on January 11th and that report gave you the estimated numbers of planned shipyard days for individual rig projects and stack days for our cold stack submersibles, the Noble Fri Rodli. So that's going to give you a pretty good idea of utilization for the year, which we are showing about flat with 2007 at 94%, and our revenues which obviously we expect to be based on contract rollovers later in the year. As Tom mentioned, the cost arena is going to continue to represent a challenge for the industry and Noble is not immune to the pressure we are seeing, particularly for labor as new build companies try to crew their rigs. We are going to give you a range for our contract drilling services costs this year of $1.1 billion to $1.2 billion. While that appears high given the $880 million for 2007, let me point out some key components. About $40 million of that increase is attributable to full year cost for the Noble Clyde Boudreaux and Noble Roger Lewis, both of which commenced operations last year, but didn't contribute to a full year of costs, operating days or revenues. This number also includes operating costs for the Noble Hans Duel, which we expect will be delivered in the third quarter. We've included about $39 million of startup costs relating to the 5 rigs under construction.…

Thanks, Kurt. You have heard our guidance for the year and our thoughts about our markets. We have got some challenges ahead of us in term of cost and keeping our people. We really don't think we are seeing the pressure on people yet. That's going to get a little more intense as some of these spec rigs get closer to delivery, but we are committed to keeping them. We just can't run the rigs without our folks on the rigs. And so far turnover really hadn't been a problem for us. Our worldwide fleet turnover in 2007 was about 9.5%, which is better than our record performance in 2006. And for the top 420 to 430 people who we track closely in operations, our turnover was under 4%. I think that says a lot about the loyalty of our employees and the special place that is Noble. Our safety performance didn't end up exactly where we wanted it to and I am not satisfied with it. As investors, you don't always get to see the importance of a strong safety culture, but you might feel the impact. We live and breathe safety around here every day and for our employees and customers listening to the call, I am committed to making sure that Noble continues to be the absolute best in the business. I think that's it for our prepared comments. Thanks for supporting Noble. We won't let you down. And with that, we will open it up for questions. Question And Answer

[Operator Instructions]. And our first question comes from the line of Mr. Arun Jayaram with Credit Suisse. Please go ahead.

Good afternoon guys.

Good afternoon, Arun.

Kurt, I was wondering if you could maybe elaborate on your discussions in Brazil, whether by good luck or you are planning... you have three of next floaters with re-pricing opportunities in that market in '09, has their strategy changed post-Tupi and Jupiter? William C. (Kurt) Hoffman - Vice President, Worldwide Marketing: To start answering your question that was all done by planning. We were just down there for two weeks in discussion with Petrobras and certainly with those discoveries, especially Tupi, there may be some change. I mean, if you talk about the size of the filed that Petrobras is talking about and the way that they want the development, as we said in our comments, it could definitely stimulate some additional demand for deepwater rigs there. Everyone's very excited about it.

Okay. William C. (Kurt) Hoffman - Vice President, Worldwide Marketing: Including ourselves.

Okay, so stay tuned. William C. (Kurt) Hoffman - Vice President, Worldwide Marketing: Stay tuned, exactly.

Okay. And last question would be I know you got three drillships in Brazil and you guys have been evaluating opportunities either to upgrade these rigs or possibly sell these rigs. I was wondering where you are at in terms of that evaluation process?

We are still evaluating. You can't really figure out what the math problems turns out like until you known what you can get for the rigs. We have made some assumptions. We known what it will cost to upgrade the rigs the way we want to. We think we know what we can get from in the open market. The last piece of the puzzle really is what will the market bear. And so we are waiting on our Petrobras negotiations to develop or waiting on other opportunities to develop because do have opportunities for some of those rigs outside of Brazil, much to Petrobras' chagrin. But we have got to figure out what the market will bear before we can conclude the math problem. We promised our Board we are going to... that we will do a full evaluation and that's what we intend to do and when we are finished we will let everybody know what the outcome is.

That sounds like an '08 decision, not '09, is that correct?

Oh, God, I hope so, yes. That's... we're deep in discussions with Petrobras now. We have been down there... as Kurt said, we were down there last week for two weeks; that's the third time we've been in their offices over renewal of this package. So, yes, I got to tell you, we are still having conversation with Petrobras about renewal of these rigs in '09, but the rigs will be heading some place else.

Okay. Thanks a lot guys.

Yes.

And our next question comes from the line of Ian MacPherson with Simmons & Company. Please go ahead. Ian MacPherson - Simmons & Company: Hi, good afternoon, David, congratulations. It's never been Noble style to build new builds on speculation. It seems like it's getting harder and harder to keep up with demand without doing that. Is that completely off the radar still when you think about demand from Petrobras and other deepwater markets?

Well, for us... I mean, we've got a full slate of capital projects right now to go out and chunk one up on the table to do on spec. A) as you pointed out, out of character for us and B) I am not sure it's necessary. So, yes, you are not going to see us go nuts doing something that's different than what Noble's done all along. I mean, we have not done things on spec and I can't see we are going to reverse that now. If you won't want those jobs bad enough, you can go get a slot in the ship for 2011 delivery and take your chances to negotiate with somebody in advance of the commitment with the yard, but I just don't think spec things are in our future. Ian MacPherson - Simmons & Company: Okay, thanks for affirming that and then my follow-up would just be on the cost guidance that we provided. I wonder if you can provide any indication of what aspects or how much of that cost increase might be offset by cost escalation provisions on the revenue side?

I don't think we can give any specific numbers. We had costs escalators in about 60... between 60% and 65% of our contracts that are not dollar for dollar coverage. They some have... you can only increase once a year, twice a year. Some you got to go above certain threshold. We may have some empirical data later. Tom, do you have an exact number?

I would say if it plays are like this year, it's been around $3 million to $5 million a quarter. Ian MacPherson - Simmons & Company: Okay.

And obviously, Ian, there is a escalators kicking at different points same time during the year. So, that means one quarter might allow you to have more recoveries versus another. Ian MacPherson - Simmons & Company: And so in another words, we might hope to just continue to see gradual bump ups on your stated day rates on your status sheet month by month?

I think that's fair to say. Ian MacPherson - Simmons & Company: Okay, thank you.

Thanks Ian.

And our next question comes from the line of Mr. Dan Pickering with Tudor Pickering and Holt. Please go ahead. Dan Pickering - Tudor, Pickering, Holt & Co.: Good morning.

Good morning, Dan. Dan Pickering - Tudor, Pickering, Holt & Co.: As we look to Mexico, obviously the market is going to watch those data point fairly carefully. I think you guys have the first industry rollover of a bigger jackup with Frederickson coming up in maybe April. Can you give us your idea of how that looks at? I know you talked about the markets, but are there any other market data points before that rig that we should be paying attention to?

That's certainly the first one we have got Dan. Keep in mind one of the things that PEMEX retains is the right to extend. The existing contracts were up to 20% of their initial term at the current price, which means that we could get a request from PEMEX to extend the Frederickson and other rigs frankly for about 70 something days while they go through their tender process, and my expectation is at the pace of the tendering that we will probably get that request. The Frederickson is the first option we have the repricing. I think it's probably one of the first in the industry and certainly the first of that class. So we are waiting with weighted breath to see how PEMEX is going to do it. Are they going to... what is their term going to be, are they going roll all four of ours out at the same time, are they going to package it with others. So we'll see. We don't yet know what their plans are. We hear a lot of hall talk in Mexico about what their plans might be, but it remains to be seen how they are going to do it yet. Dan Pickering - Tudor, Pickering, Holt & Co.: Okay. And David can they move quickly enough? I mean PEMEX historically slow to start with. As you mentioned this rig incident seems to have thrown in a little bit of a loop here. What happens if they extend and then nothing happens in that extension period? Can they extend again or would they have to renegotiate or would you have to bring the rig back?

Well, it's tough one to renegotiate without... it's tough for them to negotiate directly without having gone through a tender process. They can fast track bids if they get close enough to it, which is actually these four rigs that rolled were actually re-bids, re-bids or re-bids going through last year where they actually fast track them at the end. So they can fast track if they have. Their normal process is months, not days or weeks, but they can fast track if they have to. But just they have got to get this thing moving and when their first tender is published we'll kind of get a flavor for exactly what their behavior is going to be. Dan Pickering - Tudor, Pickering, Holt & Co.: Okay. Bigger picture question, obviously you are in a new role, not new to the company, but in a new role. Can you can you talk about sort of your first 100 days or first six months, what are you focusing on internally, externally? What's your sort of game plan, what should we be watching for from you?

Well, I wouldn't watch for a whole up different than what Noble has done for the last 15 years. I mean, there is a lot going on. This company has got a lot of movement parts. We've got 62 rigs in just about every major marker around the world. We have got a major capital program going on. Our first order business right now is to continue to do what we do and that is to deliver results, and we need to get our rigs out of the shipyard on time, and that's what we are focused on. So we... those are our primary goals right now. The other things that we are focused on is as we build cash, what are our options and what we are going to with it. We have got a multitude of opportunities and we are evaluating those all the time. We want to make sure that we continue to deliver the margins that we've delivered and that's going to mean maintaining a good strong control of cost. So those are the things we are focused on right now, Dan. I mean, you are just not going to see us do anything vastly different than what we have done in the past. Dan Pickering - Tudor, Pickering, Holt & Co.: Got you. Thank you.

You bet.

And our next question comes from the line of Mr. David Smith with J.P. Morgan. Please go ahead.

Hey, good afternoon.

Good afternoon, David.

It sounds like your preference for growth is new deepwater rigs. So I was hoping to get an update of the expected task and deliver timing if you were to go forward with the super EVA design tomorrow.

The super EVA design is still in detailed engineering. It's not something that I think that we would head out with immediately. It's a concept that's been in various stages of engineering. We were still doing evaluation of the final designs. We don't have a latest cost estimate of what it would take to deliver. I don't know that it would be appreciably different than other new builds and in terms of timing, we will be subject to same slot and same delivery schedules of yards and equipments. So, I mean, if we decide today... if we are further along on our engineering side today that we going to build one of bids, it would be 2011 at the earliest.

Okay. Going back to the Tupi topic, you mentioned that Tupi could require multiple rigs for multiple years. Do you have a range in mind?

Well, I think they have got what two well bores in there and they have announced a huge discovery. I mean, it depends on how big it gets. We've had occasion to sit down with some very senior Petrobras folks and talk about their excitement about Tupi, and in some conversations, Tupi increases their recoverable reserves geometrically. It has a huge potential with their sub salt play that could be very large. So, I mean, I don't think there is enough empirical data yet that's available to the world to be able to predict how many wells it's going to take, how many rigs it's going to take, but certainly Petrobras has grand ideas about it.

And real quick, wondering if you had any view on Petrobras desire to sponsor and grow local contractors.

Well, I think that's its good for Brazil. Petrobras has been around a long time and they have done a very good job. They are a very competent operator and a great company, and it's only natural they try to support their own markets. They have been down that road with a few contractors. I think they have frankly the limited capability in terms of Brazilian contractors that are able to meet the capital requirement to deliver the kind of rigs they are talking about. So, they're trying to do it and they had some limited success. I think they are kind of running out of candidates to go build new rigs. The latest things they have been trying to do is get somebody to build a rig in Brazil and I can tell you that's a little more excitement than we are up for right now. But that's their latest... that's one of the latest things they are trying to do. You got to applaud their effort. I think they will have limited success in the short-term.

Thank you for your comments.

Sure.

And our next question comes from the line of Robin Shoemaker with Bear Stearns. Please go ahead. Robin Shoemaker - Bear Stearns & Co.: Yes, thank you. I wanted to ask you just in general if you feel like operators are holding back a bit on their contracting of jackups in expectation of a break in jackup rates of course to the downside, which would be to their advantage. But do you sense that? I mean, we see terms shortening considerably, which would be an indication of that, but anything beyond the shortening of contract terms that would suggest that could happen?

I think it makes a lot more sense to the investment community than it does to the operating community. Most of our customers and particularly the companies that have a specific profit motive, meaning public companies either independents or majors or super majors. If they have got wells to drill and if they have got prospects that need to be drilled, they will directly go to the rig and drill them. If they can't get to drill a rig they will have to wait, but I don't think that they work strategically, specifically in the jackup markets try to time their tenders to beat contractors up with availability of new builds. So, no, I don't see it on a large scale. You might see an operator or say a specific, Saudi Aramco or something like that, and things as there is a lot of rigs coming out that has a broad base of prospects and a lot of wherewithal and they are not heard because they have a different motive, they have a production target motive more than a profit motive. You might see them try to manage a little bit more, but on the margin, I can't say that off the top of my head I've seen anybody yet do this. Kurt, have you... I mean, we just don't see it. Robin Shoemaker - Bear Stearns & Co.: Okay. Well, then perhaps I'm just wondering if in some cases what we see in the short term is a contract for rig that's going to be used for exploratory purposes, which might simply be a function of having the flexibility to drop the rig if exploration is not successful. I notice that Wellco had a 5-month contract on a new rig, a new spec build rig with reps on Libya. It seems like in very short-term perhaps.... do you sense that on a pure exploration program that that might be involved in these shorter-term arrangements?

Well, no, I mean, if you see... you go to a specific market like Libya, which is kind off the beaten track, I mean, if you are going to go and drill in Libya you got to go through some hoops to get a rig specifically there to Libya. There is not a lot of available rigs in the med that are available to us. So my guess is an operator has got a five-month exploration program, he is going to contract rig for five months, and then give himself a latitude to do the evaluation of the prospects before he commits to a longer-term program. That's a different strategy than you might see an operator who has a rig in a more material area with a lot of targets and a lot of production where he might take a rig on a two-year contract to do part exploration, part delineation and part for development drilling. So it just kind of depends on the region and the operator and the environment and the type of field work he is doing. Robin Shoemaker - Bear Stearns & Co.: Okay, great thanks.

Sure.

And our next question comes from the line of Mr. Roger Read with Natexis. Please go ahead.

Good afternoon, gentlemen.

Good afternoon.

Kind of following up on some other questions around day rates from Robin. Looking at the jackup market, day rates look flat across most of the world. I mean, whether we are talking about your rigs or the rest of the markets. Cost continue to creep up. So it should make it a tougher on a speculative guys with jackups coming into market, especially those without an operating base to work with. You sort of off the call kind of talking about the possibility of M&A, rig acquisitions. Have you seen any erosion in the asking price for jackups that are out there or does that remain sort of stubbornly above the $200 million range?

To-date we have not seen a lot of movement. We have seen some. I think the thing... the interesting thing is what's happened in the public markets here in the last... well, this year really. And the erosion of the value of some of these. Most of these guys, particularly these one and two rig companies are taking some money off the table in Oslo and public markets have a way of valuing their assets for you. So I think if you go to and look at some of those companies, the value that I think probably has had a some kind of trading premium built into it because everybody expects those rigs to sale, has eroded a good bid. That doesn't mean that they are asking price, by definition, has eroded much, but there's got to be a convergence. I mean, $250 million for a standard jackup is pretty pricey. I think the closer that you get to these rigs actually haven't go to go to work and these guys actually waking up in oh my God, mode one day and having to be a drilling contractor. You've got to see convergence between the bid and ask and to-date we haven't seen enough of that to get excited about it. We are watching it, but there is nothing to get excited about yet.

That's great, thank you.

Sure.

Thanks Roger.

And our next question comes from the line of Mr. Pierre Conner of Capital One Southcoast, please go ahead.

Hey good afternoon everybody.

Good afternoon.

Just a quick clarification on lease guidance on cost. I want to verify that does not include reimbursables, normal rimbursables nor any cost escalation reimbursables, correct?

Well, it does not, that's correct. And it certainly does not include the reimbursables at all.

Got it.

And then we actually... Tom made a point of saying $3 million to $5 million per quarter on average is what we have been able to get on cost escalation reimbursables.

Right, okay. Kind of related to that. Actually maybe for Kurt. The comment about the rate increase I think on the Ronald Hoope, 2005 to 2007, just to verify was that truly real a margin increase or was it something... is that a bit of a some of that push through on recovery of costs?

No, it wasn't really based on recovery costs, Pierre. It was based on where we thought we were in the market and what we consider 6 months being somewhat of a short-term opportunity that was... for the amount of term that they were offering, we thought that was a fair day rate.

Okay, fair. Just want to be sure on that one. Kind of sticking with the jackups, a lot of questions have been asked on the floater on the floor so far, but you mentioned 6 maybe net needs in West Africa, several... and in the Middle East. Where do you think those rigs come from? If you are looking at those opportunities, what markets are you looking at if you would look at the incremental one, where do they come from?

Well, there is certainly... and again I want to clarify one thing before I answer your question Pierre. When we talk about incremental demand, we strictly talk about tenders in the marketplace that we know about. So if you talk about 40 new jackups coming out and then we talk about incremental demand, it might be hard to connect the dots, but it's actually just the opportunities that we know of that are in the form of a tender. I think that's a most honest way we can portray it to you. As far as rigs entering some of the markets that we are in, we mentioned the Middle East, we mentioned Nigeria, certainly there's contractors that have assets in the Gulf of Mexico that they would continue to look for opportunities to move them out, and also specifically to the Middle East, we have seen one of the builds enter that market, which was I believe a Maersk unit. So, contractors clearly still trying to come up with an exit strategy out of the U.S. Gulf of Mexico shelf and certainly some of these areas are being looked at by the new build equipment.

Okay. And related to the Frederickson in this same vein of thought, given the variability on how that might unfold, I don't know how much you can disclose, have you looked at where that might fit in term of if it moves out?

Well, yes, we've looked at it. I think it's fair to say that we are bidding rigs into the markets where we are working and out of the markets we are working almost every day. We were not married to Mexico. We like Mexico. If we have an opportunity to put one of the rigs in West Africa over there under the right terms and add to our, we would. If there are opportunities for our rigs in Mexico and other markets we're not ashamed or afraid to pursue those. So we are always trying to fit square pegs and square holes. So to the extent there is a better opportunity at some place else, we will go chase it.

Okay. I understand. Last one about... a little bit about cost. We hadn't really even nailed down '08 exactly, but of the $450 million of major projects, major maintenance, is the bulk of that to be concluded in '08 or is there a piece of that component of the CapEx that I suppose you mentioned major projects and sustaining this way, but some of that is... we should think about as a continual.

You should think about most of that being here in '08 and then if any we continue over into '09 we would obviously put that into our 2009 capital guidance.

Got it. And you can see what I am after is, you got 170 of major maintenance, the 450, how much of that carries over again and beginning to think about myself what that CapEx is, because as you point out, your free cash flow is really an '09 story. William C. (Kurt) Hoffman - Vice President, Worldwide Marketing: Yes, that should be viewed as this year and you can see that we have a number of projects that are going to be going on in the Middle East. From the fleet status report that we put out, where we are going to be working on some jacking systems and top drives draw works.

Okay. That's what I got. Welcome David and I appreciate the input guys. Thank you.

Thank you very much.

And our next question comes from the line of Mr. Collin Jerry with Raymond James. Please go ahead. Collin Jerry - Raymond James & Associates: Hey, good afternoon, guys.

Good afternoon. Collin Jerry - Raymond James & Associates: I had a quick question; you mentioned kind of a corporate strategy going through. Can we hear kind of what you all feel the benefit and/or the risks would be to major consolidation going on this space? It's kind of been a highly debatable issue in recent past.

I think for the benefits, you probably ought to ask somebody else about it. We obviously haven't done a whole lot of major M&A. I think if you look... you dissect the Global Santa Fe/Transocean transaction. They had $100 million to $150 million of synergies in there, which is kind of rounding year in a company of that size. And so the real benefit was the recap of the company, and we've dissected, we talked to your peers and trying to figure out exactly where it was. It appears to us they could have probably done that on their own. So I don't know that I see a benefit. They certainly saw a benefit and they like to talk about strategic benefits and I guess they see some of it on that scale, at least in that transaction we don't see. Consolidation is... we get a lot more talk than we do action. If you could... for strategic benefits there might be reasons, but I got to tell you, I mean, we are sitting with 62 rigs that we've build from what this company was 20 years ago, a mid-Continental land drilling company with an operation in the one rig in Nigeria and a few rigs in the Gulf of Mexico to a force in the industry, a few rigs at a time, we can compete with anybody. I mean, we can add to this fleet. There is going... there are a lot of opportunities out there, there are a lot of rigs under construction without life after construction. We think the bid ask is going to trade closer. That goes for both jackups and floaters. We have got customers coming to us all the time for our rigs and trying to figure out if we can put other rigs in here. There are a lot of opportunities out there. So, I mean, with our rigs and our strategy, we can compete with anybody. So, it's got to have real value to the shareholders or it's got to be a real strategic maneuver for us to see any real benefit to shareholders. Collin Jerry - Raymond James & Associates: Right. And I guess from the financial perspective, the recapitalization that doesn't really seem, but from a strategic standpoint I am guessing is the scale, do you get any kind of scale from a strategy with going to your vendors and pricing negotiations or certain regional markets, is that there or just --?

We have been and I suspect we still are national oil [ph] Arco's biggest customer. And we have gotten to the closer lines with those guys, we got closer lines with other vendors. Sure some scale adds benefits, but I think we have got enough critical mass to reap the benefits that are achievable from what scale provides. I don't know that just getting bigger means a lot to us. Collin Jerry - Raymond James & Associates: Okay, well, thanks. Last question is you mentioned that tenders in Saudi, kind of historically they've had somewhat of an owner's cost regimen over there, has that changed any bit? Have you seen any kind of taxes alleviation or anything like that? William C. (Kurt) Hoffman - Vice President, Worldwide Marketing: This is Kurt. Your assumption is correct and that we have not seen any changes. Collin Jerry - Raymond James & Associates: Okay, I appreciate it.

Your next question comes from the line of Mr. Jud Bailey with Jefferies & Company. Please go ahead. Judson E. Bailey - Jefferies & Company: Thank you, good afternoon. Just a couple of follow-up questions on Mexico. David, could you explain a little bit on what your hearing from PEMEX? Is there uncertainty this year? Is it unsure of what they want to do? Is it an asset mix issue? And is it cantilever versus mats, or timing issue or do they really not know themselves?

I think they know, I think they are just not sharing it with us yet. I mean, PEMEX... as Kurt pointed out, this incident they had down the kind of slowed their process down. I mean it was quite an event. Those kind of... accidents like that are not good for anybody. And I think PEMEX rightly so is doing the right thing and trying to make sure they handle that appropriately. And that slowed their process. I think certainly they know. I think they are not prepared for either their process isn't their yet, or they for whatever reasons aren't ready to disclose to the market exactly what their plans are. We hear a lot. We have been down there long time. We have a very close relationship with PEMEX at many levels on many fronts and we hear the same rumors that you guys and everybody else hears that there's going to be incremental rigs between 5 or 10 units. We have also heard that they are going to contract out of the mat rigs. I don't think they can do that. I mean, I think if you look at the cost break for them or the rate break between mat rigs and independent leg cantilevered rigs, it's just not reasonable to assume they are just going to do that. So, we would like to see if it's 5 rigs, incremental rigs that's great. We would hope to see their independent leg rigs. For us what it means is we will have a whole lot of clear availability around the world. If there is incremental rigs it means that our rigs all have the future. How we price them and how they contract them, we would like to see that. But they have been real forthcoming yet with…

We hear that all the time. We have not seen it. I don't know what you are thinking. My guess is the thinking is the same as every operator when they see rates go to these levels, I think, dang, if they can make these kind of money, may be we ought to get into the business, but normally cool heads prevail and they realize there is a reason. They do what they do and we do what we do and they don't pursue it. I don't think it PEMEX really wants to be a drilling contractor, but we will see what the tenders look like. Judson E. Bailey - Jefferies & Company: Great, thank you.

Thanks Jud.

And our next question comes from the line of Mr. Bill Sanchez with Howard Weil. Please go ahead.

Good afternoon.

Hi, Bill.

Kurt, a question for you. Just following up on earlier comments you made about potential migration of jackups still from the Gulf of Mexico. I know you have no presence there right now on the jackup side, but any sense in terms of just the numbers here for '08 as you guys see it and as you marked international markets, how many additional rigs may come out of Gulf of Mexico as a whole? William C. (Kurt) Hoffman - Vice President, Worldwide Marketing: Bill, that's hard for me to answer. I really don't know. If you look at the Gulf of Mexico shelf market being somewhat flat and there are still some idle rigs, however with our submersible business here in the new year, we have seen a modest increase in activity for that market. It's hard for me to say how many rigs, Bill, I think might migrate out, but it's certainly safe to say that for the majority of the shelf drilling contractors with the presence in the Gulf of Mexico, the majority of them are looking for opportunities outside the shelf.

Okay

Bill, I think if you all take that a step further and just say they are looking for opportunities, the fact of the matter is most of what's left in the Gulf is mat supportive rigs and they don't have a real broad appeal outside the Gulf. There is a few independent leg rigs here that could move. Most of the higher spec independent leg rigs that have brought international capability are drilling deep gas prospects at rates that are closer to international rates than Gulf of Mexico rates. I think Kurt's right, they're looking for opportunities. I'm just not sure how many of them could actually do it because of either they've got quarters limitation, they've got regulatory problems or life saving problems or just chip problems. So the cost to get some of those rigs out of here I think is going to be prohibitive.

Right. Is there any scenario where you see actually some of these new builds potentially entering the Gulf of Mexico over the course of '08 or is it still just may not strong enough and the insurance issues being too punitive to move a new build into it and essentially be self insured in this market?

Well, I mean, I think if you dream hard enough, you can come with a scenario, but I don't think it's very logical to assume that any of the new builds are going to wind up here unless it's the market of last resort.

Got you okay. One other question for Lee. Lee, you're able to just assign perhaps maybe on a per rig basis, I know in the last fleet status report there were a number of notations made about regulatory inspection surveys on a handful of rigs. Just kind of on a per rig cost, which you... is there an average cost we should assume on each of those rigs that's for surveys?

There is really not a great way to average it out. I mean, each project, especially the ones that are at 50 or 60 days have their own capital budget associated with them and then the ones obviously that are of a shorter duration will assume would be less expensive, not only in terms of the costs associated, but also in terms of the out of service time. So we are probably not going to break those on a per rig basis.

Okay. Anything just in general for the year since you did give some details on the total costs, is there a survey component you could add to that?

No, we have given about as much detail as we're going to give.

Okay. Thank you.

You bet. Thanks. We are going to take one more question today.

Fantastic. And our next question comes from the line of Mr. Geoff Kieburtz with Citi. Please go ahead.

Good afternoon. I'll better use this option wisely. I'd like to kind of rephrase an earlier question, you got $450 million of major projects and sustaining plus 170 major maintenance schedule for '08, when we look at that number, what should we expect to be repeated in '09?

For '09, it's so early to say where we are right now in the process. Frankly Geoff, I would just kind of hold it flat, and that will probably be a reasonable number and maybe a bit conservative for you.

So it's somewhere around $550 million to $600 million kind of recurring capital expenditures?

That's where we've talked about it being in the past.

Okay, alright. I would like to go back to the jackup market question, just to clarify, have you seen a change in the dialog with your customers in regards to contracting jackups, say, over the last six months?

Have we seen a change, there is less availability, so we are probably having fewer conversations. Other than that I would say no.

Okay. So really the large number of jackups coming out of shipyards over the next 24 months, you don't see having changed the dynamics of your dialog?

Well, of our dialog, no, we'd have to be idiots not be paying attention to it and not be aware if there is a large number of incremental rigs coming into the markets. So, I mean, certainly we are aware and the whole world's aware. So in the context of that dialog about availability and startup stuff, certainly that's on the radar screen, but we don't see anybody pull it back from drilling operations. If they've got a drilling operation they want to start in '08, we don't see them say, we are going to push that back to '09 to see if we can bring some more bidders in here to create more competition. That's... we haven't seen any of that. We have seen programs, we are having a conversation with one operator one day about having a one-year program and he may the next day jump up and say, gee, I don't want to go one year, I will go six months. The next day we're having conversation with another operator who says I have got a six-month program. Two days later he wants to turn that into a year. So it's... we don't see a lot out there. We hear a lot from you guys, but we don't see a lot out there. And when Kurt talks about our incremental demand, we are getting that from our customers. We are not out there... we are not modeling this and we are not running a bunch of algebraic formulas and stuff. We are getting empirical data from our customers and that's the best information we have and we don't see yet where in the markets where we are active that we are in danger with the fleet we have got.

Got it and in terms of that visible demand, the sort of identifiable tenders I think is the way that incremental demand was defined. How far out does that go? I mean, I am sure that's changing daily, weekly, but I think there was kind of three or four rigs in each of may be six different markets that were sort of listed earlier. Over what time period would you expect those to either be bid or fall out of the picture? Is that kind of a six-month horizon or --?

Well, it depends on the market. I mean, it depends on the market. There are discussions with some operators in markets they can come to fruition very quickly. I mean --

Yes, got it.

Actually had dinner with customer the other night who said they had an opportunity for a program for jackup that they thought they could conclude within a matter of days. You go to PEMEX, our rigs roll in May, June plus potentially some extensions that are available. We think that PEMEX if they are going to do their protocol in a timely fashion, they need to get started. So it depends on the customer. Some of this can happen very quickly, some of it takes some time, and that really hasn't changed, that dynamic really hasn't changed over the last 6 months of the last 6 years, frankly. The jackup business is inherently much shorter term than the semi or the floater business is and it can happen pretty quick. We are taking about availability of jackups, extension of jackups that are out in the future and we are talking about some that are coming up in the next quarter. So --

Yes, that's... kind of my point I guess is it seems like there has been an estimate of about 20 to 25 incremental jackups in demand for 12 or 18 months now. It just seems to be kind of a constant number.

That's a good sign I think.

Yes. And then --

It was lying with the 25 absolutely. As long as your 25 rigs ahead of the market, you are in good shape.

I guess just when drops to 15 that we start to get scared.

If it goes the other way.

The last question was just on the M&A topic. I could kind of take from your comments that really the deciding factor in whether Nobel would get serious in terms of a jackup either asset or corporate acquisition is really just the asking price. Is there any other dimension that comes into that decision?

Sure. I mean, what we think in the market will bear for that rig, I mean certainly asking price is a big piece of it. But we are going to model it conservatively based on the life of the asset, what we think the market will bear, what it cost, what the return to the shareholders are. What strategic value it might have in the fleet. There are a number of factors, there is no one factor that makes the deal work or not work. Certainly the price is too high, that will kill it in a hurry, but there are a number of parameters and a number of elements in the equation that go into how we evaluate any opportunity.

Fair enough. I guess I was looking for the... you kind of downplayed the strategic dimension of M&A earlier and I was sort of assuming as a consequence that price was the almost only deciding factor in whether a jackup purchase would be considered, but it sounds like there are some other elements there.

Lots of them. Sure.

Okay, thanks very much.

Thanks Geoff, appreciate it. Dennis, we are going to go ahead and conclude the call now. We really appreciate everybody who's tuned in today and we appreciate your continuing support with Noble. As I mentioned, Brook and I will be available after the call here in a little while to a start returning your phone calls and we hope that you join us for next quarter. Thanks very much.

Thanks. We'll see you next quarter.

Ladies and gentlemen, that does conclude the conference call for the today. We thank you for you participation and ask that you please disconnect your lines.