Good afternoon, my name is Tiya and I will be the conference operator today. At this time, I would like to welcome everyone to the Noble Corporation's Third Quarter 2008 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks there will be a question-and-answer session. [Operator Instructions]. At this time, I would like to turn the conference over to Lee Ahlstrom, Vice President of Investor Relations. Sir, please go ahead.

Thank you, Tiya. Welcome everybody to today's third quarter 2008 earnings call for Noble Corporation. Before we begin I would like to remind everyone that statements we make today about our plans, expectations, estimates, predictions or similar expressions for 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 the industry and the various factors that could keep outcomes of any forward-looking statements from being realized. Our actual results could differ materially from our expectations. We have included detailed balance sheets, and income and cash flow statements with our earnings news release. Also when we open up for questions, I'm going to ask you to stick to one question with one follow-up. I am sure you'll understand, we'll have a large number of folks who'd like the opportunity to have a question and we want to be fair to everyone. So if you ask a question and your follow-up and you want get back in the queue that's just fine. With that, I will turn the call over to David Williams, our Chairman, President and Chief Executive Officer.

Okay thanks Lee. Good afternoon and thanks for joining us today. A lot has happened since our last call, at Noble in the industry, in the broader markets and we're looking forward to give you an update on Noble and our view of the world as it happened just yesterday. Following my remarks, Tom Mitchell, our CFO will go with some of the financial highlights during the quarter and Kurt Hoffman, our VP of Worldwide Marketing will briefly review our markets and then we will open it up to questions. Let me start by saying that despite the performance of the equity markets over the last few weeks and our business they are not coming in great shape. The results we reported last night are solid especially considering $20 million of loss revenue and $10 million of additional expense related to Hurricanes Gustav and Ike during September. While the financial crisis has impacted the global economies from the credit markets to commodity prices we continue to have confidence in our business. The world still runs on oil and gas, and the meltdown in the financial sector we lost the confidence and the equity markets have not changed this fundamental fact. Effectively the only thing that's changed for us in the last 90 days is our share price but our operating activities, our modeling activities, our strategic evaluations are all ongoing and so far are all largely unaffected. We plan and run our business for the long-term as do our customers; offshore exploration particularly in deepwater is a well developed and fundamental long-term strategy for our customers. Likewise, our evolution towards technology and deeper water rigs is a result of the same strategic long-term focus. Both our customer strategies and our own were conceived a long ago not just over the…

Thank you, David. Our results for the quarter are very straight forward and I only plan to touch on some of the highlights. Last night we released earnings of $383 million for the third quarter or $1.43 for fully diluted share. This compares to earnings of $376 million or $1.40 per share in second quarter of '08. But remember that the second quarter earnings included an $0.11 per share gain on the sale of our North Sea labor contract business. Contract drilling services revenues were up almost 7% from last quarter, as 10 rigs in a fleet rolled to higher day rates, in particular the sig areas began a 10 months contract in August, with Chevron in Brazil. At $525,000 a day up from its previous rate of $124,000 a day. And the Noble Max Smith up higher from much of the second quarter while it was in the yard preparing to move to Mexico started its three year contract with PEMEX at $484,000 a day. The cost line was also a positive story during the quarter with contract drilling services cost down about 1% quarter-on-quarter. The main driver here was lower spending on repair and maintenance and operation support. Our per day cost were actually down 1.4% on the second quarter. Through the third quarter daily contract cost of $52,300 were up only 9.3% from our fourth quarter '07 levels which is actually a bit below the guidance range of a 10% to 15% increase. These savings are result of intense focus on cost control and do not represent cost deferrals. So for the full year we now expect to come in near the bottom of our guidance range which was $1.1 billion plus or minus $50 million. You are well aware we experienced two hurricanes in the gulf…

Thank you, Tom. My comments today will be brief and focused on the backlog and the general nature of the markets. Noble's fleet contract and backlog position remains very strong. Overall and excluding the three submersible units, we have 93% of our available days booked for 2008, 77% for 2009 and 40% for 2010. With the exception of the Noble Carl Norberg our deepwater fleet is fully committed during this period. And looking at the jackups, the numbers are also strong for the remainder of 2008 through 2010. They are 90%, 70% and 20% respectively. As of mid-October, our maximum contract backlog revenue potential was about $12 billion. This was fairly even with where we were on June 30th as well. The backlog figure includes earning maximum balances on our rigs in Brazil. Of that amount, about $2.8 billion is contributed by the jackup fleet with remainder coming from our deepwater assets. Although, both David and Tom have mentioned this, I will like to add that I am confident in the strength of the backlog and the customers that comprise it. We have good contracts and we have no indications that our customers have any intentions other than meeting their obligations. We signed relatively few contracts during the quarter and this is mainly driven by the fact that we are already so well contracted. I would, however, like to touch on some highlights. In the deepwater market, we received a two-year contract from the Noble Paul Romano at a day rate of $605,000 a day and this is a fourth-generation EVA unit. In the North Sea, new contracts on the Noble Julie Robertson, the Noble Piet van Ede, and the Noble Lynda Bossler extended our coverage in this downs market into the third quarter of 2009. The West African market…

All right. Thank you Kurt. Before we open up for questions, let me summarize where we are today. Our business is in great shape. We have numerous opportunities for our Globetrotter class rigs with several good dialogues ongoing and there are good opportunities for our jackups in markets where we have exposure. We expect business to continue to remain strong after all the genesis in the current growth cycle is not the result of $100 oil, it started much earlier in the decade and a $100 milestone came further late in the game. Keep in mind that we committed the Noble Danny Adkins and the Noble Jim Day upgrades for long term contracts when oil was around or it was actually just below in one case $60 a barrel. It's impossible for us to tell you what demand for our services will be a year from now when we actually begin to have some limited rig availability. If all the $50, that's one scenario it falls back between $80 and $90 or even higher, that is a different scenario for rig demand. But either way, we will be ready for it. If the business does weaken, our backlog and balance sheet will sustain us and provide a tremendous platform with pursue acquisition targets. We can't control what the commodity price does or how the equity markets behave. Frankly, you have a lot more influence on that than we do. But what we can do and what we will do is do what we do. We'll execute everyday. We'll control our cost. We'll maximize our margins. We will deliver results and we will be prepared for opportunities. And with that, we will open it up for questions. Question And Answer

[Operator Instructions]. Your first question is from Robin Shoemaker with Citi.

Yes, good afternoon, thank you. I was wondering if you could comment on the behavior of competitors who are getting new jackup rigs or about to receive new jackup rigs putting them in the market, where you are seeing rates impacted by new supply and if you could just comment on the overall rig structure in your key markets?

Sure, this is Kurt. We have actually from the new comers that have come into the markets with jackups, we have actually been fairly pleased with this play they have had in their pricing. So in the markets where we compete against them there has not been any big issues that would raise a concern amongst Noble and our markets on how the new entrants are pricing their assets. So we are not... that's not a concern as of this point anyway. In general, the markets that we operate and David mentioned on it... touched on it earlier, it's very important that the majority of all work, especially with jackups is contracted with national oil companies and they have a much longer view of the markets than other type of companies. So we're confident in where we are, we still see good opportunities and additional opportunities and then I'm sure we will talk about on this call and the markets that we participate in.

Okay. And the... when you talked about some rigs that may become available where financing is problematic. Are these both on the jackup and the deepwater side, or principally on the deepwater?

Opportunities that we are going to see in that... from that aspect I think you'll see both. I think you'll see some specular gas in deepwater and some speculation in... those speculators in jackups that could potentially fall out. It will create opportunities for us and others.

Okay. Thank you.

Thank you.

The next question is from Alan Laws with Merrill Lynch.

Good afternoon I guess. A couple of questions, just wondered more of a question around your use of cash, the last quarter you guys talked about having a good balance sheet thinking about the special dividend potentially some M&A, and then you shifted in the quarter to not pay special then look more to an organic rig construction model. I was wondering, can you tell me what went on in the discussions during third quarter that made you decide to shift to this different strategy?

Well, it was a different strategy. I mean we've said all along that we were going to use the cash, we said we consider special dividends, we said we consider buybacks. And we've always said that we were more interested in adding long-term assets. And if you look at when we close the second quarter, our share price was about $66 or $67 by the time we did the call, share prices down to around $50. And it started looking pretty cheap to us and our Globetrotter opportunities starting to get mature. So it was as we thought from a strategic viewpoint, it was a better use of the cash. So that's the decision we made.

All right. With the backdrop now you've bunch of a floating rig speculators and some jackup speculators having financial issues. Any thoughts to straight out M&A in there instead of taking the time to... it has been four years in building another one like I know you have three more slots just wanted to know what your current thoughts on that?

Well yes, I was sure. We will evaluate all those rigs... the Globetrotter will be a great bell weather for us and we can build that rigs from the key left of $585 million. The other rigs, the other rigs are priced at varying comparable rates. But what we're seeing in the market that might be available to us doesn't yet compete with that level of investment. We can deliver the Globetrotter in 2011 which is compared with somebody's other opportunity you may see and of course we would rather take out capacity that's out there but it's got to be competitive what we can do on our own. Some of these things are the BDO and there is a undermine somewhat by what I think are below market contracts. We don't want to step into somebody that's taken a below market contract or somebody will bail them out at $150 million more rolling to build a Globetrotter. Of course I mean all that will come into play. We will evaluate all these things against what we can do ourselves, but they got to be competitive and the fact that they are in troubled financing, hasn't yet gotten to the point where they are cheaper enough to just five dime [ph].

They haven't sharp... means sharpen them around yet?

Yes, sharpened around but there's, the last new build announced before the Globetrotter was about $740 million its about a $150 million more than what we can do. They'll sharpen them around but they're not sharpened them around at rates that are at a cost level that's below or even close to what we can do Globetrotter. Globetrotter is a very efficient design and it's a very well contracted new build its back end loaded on payments I mean we really like the way its put together and we haven't seen anything they yet to compete with that.

Sure. Now you guys have a history of some good engineering to bring down the cost in the equipment. Last question I have is on your jackup that will come. Bankers use to talk about the Qatar market, kind of come in part of there, I know you guys are big in the Middle East. Can you talk a little bit about that?

I wouldn't characterize as coming apart. I think there are a number of projects over there that have been going for a number of years. They're kind of running their course. I mean these are a lot of these fields only have infinite life in terms of drilling, they drill them and they produce some and I think there is a lot of work over there that has been on going for a long time and some of those projects come to a close. I think you... that's the markets work. You will see the work done and then they drill them up than you'll move rig some place else. At the same time there is a lot of tender activity over that part of the world that we think will slow some of those rigs up. So I mean it's just the way it works. We watch the project comes to an end but we are certainly not panicked about the Qatar. There is more opportunities in Qatar, there is an active tender at Saudi Arabia, there is work in India, there is lots of work over there.

All right, great. Thanks for the answers, appreciated.

Sure.

The next question is from Collin Gerry with Raymond James. Collin Gerry - Raymond James & Associates: Hi guys. Not to beat the dead horse here on the cash issue you but, some I guess one of our competitors is talking about dialing down the buyback activity as you are seeing some better opportunities out there in the M&A front. Just given what you are seeing in the credit markets. Is that something we can expect from you all too?

We've got a lot of liquidity, we have got some cash. We've got some... we haven't competed our budget yet. But I wouldn't necessarily say that we are not going to buyback stock. I wouldn't necessarily say that we would. We are going to look at opportunities. And there are more... we would tell that opportunities for a long time, we've been grabbing because we can talk about having done it, while we did it. And we like it. But we are seeing more opportunities now than we did 90 days ago. So we're going to look at everything, buybacks part of the process. Collin Gerry - Raymond James & Associates: Okay. And then switching gears on the cost front, it seems like the last few quarters, you all been covered in right on the cost front which is certainly kind of different than the industry trends, I would say, in your particular segment. What exactly is driving that? Where are you all doing? And is currency, moving currency having a big impact there?

Well, currency helps. Well we have certainly sideways with most of the other currencies 90 days ago. And the deterioration of the foreign markets has kind of improved the position of the dollar relative to euros and still, as that helps. But I mean I don't think that's really what's driving our cost. It certainly helps. But our cost... our efficiency in this company is just driven by 87 years of history on gas and oil, of how we're going. We are... Noble is a very efficient run, very experienced drilling organization. And we look through our guidance yearly on in the year and felt like that we could do better. And we worked it hard and our guys responded. So we're just doing what we do. Collin Gerry - Raymond James & Associates: And so is there any one thing that you can maybe point to that versus the guidance came in as a surprise, whether it be more efficient and how you all use labor or ropes open don't buying the equipment. Any one particular thing or just kind of across the board?

There is no one particular. It's a lot of little things. It's a lot of little things and its just we're trying to run our organization more efficiently. We are maintaining the fleet, the fleets are in great shape. We are not cutting back, do as up. We're just doing a better job, but doing what we did. Collin Gerry - Raymond James & Associates: I appreciate it.

This is Tom. I just want to tag on to that. We did not have just a lot of currency assets from the quarter. Most of the devaluation in the currency has happened in the last three weeks. So there is a little bit of that in the quarter, but it's not what's driving the numbers. It's cost control. Collin Gerry - Raymond James & Associates: Okay. I appreciate it.

You bet.

The next question is from Dan Pickering with Tudor, Pickering, Holt.

Good afternoon, guys.

Good afternoon, Dan.

David could you talk a little about, I mean you have explained Globetrotter as significantly less expensive asset than others. Maybe you could just walk us through how you get there? I mean is it you got a better yard. You've got a better design I mean, where did the couple of 100 million bucks come from?

Well Dan we're just better.

Tell me how do you get it?

Thank you. It's a combination of things. It's the geometry of the ship, it's a smaller vessel than a lot of people are building that are... a canned vessel coming out of the Samsung or one of the other yards where they've got the design. This rig is 620 feet long. It's narrow, the beam is about a 105 feet. It will actually go through the Panama Canal which is a nice feature. So the overall geography that's available to you in the primary structure is little bit smaller. The way it's laid out, we actually a hole left into the rig, once you enlarge it's all flat aerospace. We've able to recover some of that from the designs, from a fishing standpoint, we didn't give up anything. We were able to find a Korean, a successful Korean ship yard, it wanted to establish themselves in China. They build lot of ships in Korea but they wanted to get this kicked off in China. We've got very comfortable with the Chinese labor market. And the fact that they get coupled with the Chinese labor market and the Korean expertise was perfect for us. They wanted to come in here. They were... wanted to get this thing kicked off and so they sharpened their pencil, they made us a great deal. On the other side, you have got Housemen who has building the tower and a lot of the other associates to keep the cranes a step to go with it. And they have been working on this technology for 12 years and more. And they sold a couple of them. But we have long tied with Housemen and a lot respect for their engineering capability. And we've been talking to these guys for a long time and they were interested in doing something with Noble and we were interested in doing something with them and they sharpened their pencil for us. So it was a combination of things, its something that we will wake up one day and have a bid on our doorsteps, and see this is an opportunity, this is how we have been working hard for a long time. And finally got it to a point where we liked it well enough and we are comfortable with the design and from a pricing standpoint it just made too much sense to pass up.

Okay. And I apologize for not knowing, if you answered this. The priced options that you have are they at the same 550?

They vary a little bit. The second rig is actually less expensive than the first rig and the other two rigs escalate a little bit depending on when we exercise our options.

Okay, alright. So there is a time premium in there.

There is, yes.

Okay. Thanks and then I do want to understand a little bit better on the cost if you don't mind. When you talk about 10% year-over-year as a good price holder. Is that in absolute dollars at this point?

That would be against what we... that's on a per day basis to start with and then it would be against our... of course at where we are now for the quarter.

Okay. So you think generally you can the hold cost flat at this level on a daily cash cost basis?

No, I mean we... I think you ... I'm really just giving you a number to throw it out there. We are pretty early in the process. So what I would tell you to use it as the price holder, and very loosely right now. Now we... the pressure continues on labor cost, but we've been able to kind of hold the line elsewhere, but the cost pressure is still there and what's happening in the market right now is really not abating that. So we're pouring through it, we've worked our capital first and then we will add up cost in G&A right now. So it's really preliminary, but I did want to throw something out so you guys could begin to set your models up.

And remember Dan, we're going to have the Dave Beard coming online next year. We're going to have Scott Marks, we'll have the Danny Adkins. So we'll have a lot of additional operating days from those three rigs. So you will see a bit more cost associated with those rigs. And saying that we think, on a per operating day basis giving that guidance of a 10% plus or minus increase is consistent with how we did that last year for you.

Got you. And justly, so I understand the plus 10% would incorporate the mix of the different rigs that are coming on and the existing fleet, etcetera?

Yes, that's what again when we say on a per operating day.

Okay.

Yes.

Thank you.

You bet.

Your next question from Kurt Hallead with RBC Capital Markets.

Of course, we're not [ph].

Hi, Kurt.

I meanhow are you guys doing?

Good. How are you?

I am doing alright, doing alright, thanks. There is really a couple of things in some of trade rigs recently about Petrobras potentially raining in some of their programs. I am not quite clear specifically as to how that may translate. I know you guys are very good at market intelligence and keeping close to the customers. What you're hearing out in Brazil?

What I have heard and what I have read I think is trying to more succinctly clarify what some of the statements, some of their senior managers had made publicly. For a while... one of the guys got up in front of crowd of people, the number of rigs went up sometimes exponentially in terms of what they were looking at. We don't see anything yet that tells us Petrobras is pulling back. They've got huge opportunities, they have got a lot of investments. I think the interesting thing from Petrobras right now is what Kurt talked about earlier, and what's going to happen to these new build gas that's sign up at $400,000 a day and again they have problems putting those deals out there. So we don't see anything yet which tells us that Petrobras is reversing course. So I think they try to clarify their position little bit. But, I think frankly they're going to have trouble to get what that thing, what they think they got lined up now. So I don't really see any issues.

As this financial credit issue, had any specific clarifications on PEMEX plant?

No. Not enough, not that it's manifested anything that we could see. I mean Pemex as far as we tell, is still full stream ahead. So, now... we got a lot of Pemex. I mean they, if one major work, and we're one national company on the planet, both will need the hydrocarbons. So you don't really expect to see a lot of pullback there.

And, then I guess with this credit issue also having an impact on some of these speculators you referenced it earlier. Is it shocking to you that these guys aren't coming crawling on their knees, begging you to help them out?

Well, I would say they weren't coming to us. We don't have anyone coming to door at knees yet, but I got to tell you, I mean there is a lot of frogs on the doorstep right now and we seeing which ones is really present, and which one is early frog. I'd say, it's kind of fun. It's... we're sitting here kind of looking to see how it's getting developed. As Tom said, we may kind of sit back and see how this develops, because so far they are not as hungry as I think they should be. Or as hungry as I think they need to be and maybe they are thinking this credit crunch is going to ease. In time to save them, some of them I think they are already effectively dead. They just don't know it. So it's... there are going to be a number of opportunities out there for... I think you have to view the most of the established drillers are going to flush their cash and look in for opportunities like we are. The question is how hungry are the potential sellers and how appealing are the individual dealers or the respective buyers.

Thank. That's it for me. Thanks.

Thanks Kurt.

The next question is from Geoff Kieburtz with Weeden. Geoff Kieburtz - Weeden & Co.: Thanks. Good afternoon. Kind of following-up on that last comment. Could you kind of, this all phenomenal of new builds being kind of under distress sale condition is kind of new. And it sounds like from your comments earlier that you'd be... any opportunity you'd basically have to step into the current owners, commitment to the shipyard and you'd have to step into their shoes in terms of commitment to a customers, is that correct?

Well not necessarily. There... I think each of these have the potential to be different scenarios. For instance, I mean if somebody has sign up to build a rig for Petrobras or PEMEX or whoever else, let me show [ph], I don't know. If that actually goes to a bankruptcy, does that drilling contract survive? And does the operator have a termination right in conjunction with that effective insolvency as they may or may not exercise before the rig changes hands to a legitimate contractor. I mean all of those questions play in to how you evaluate the opportunity. It is not very exciting for us to step into a 700... $650 million or $700 million drilling rig that's contracted to Petrobras at $400,000 a day for five or six years. That is... the math that work for us that's why we didn't sign up to start with.

Alright.

So all of those are becoming opportunities. And you are right this is a new, this is a new phenomenon as we see it today. This is not a new phenomenon in this business. This is this is precisely the way Noble is built. As... built in... rigs built in other cycles that were acquired as cycles add or as crunchy as came. So this is kind of what we do. This is one other things as we as those had run these rigs look for opportunity around. So we are... we are looking and we have yet again we haven't yet seen anything that's exiting enough that we are just ready to pounce on it. But if the tightness in the credit market keeps building, and if you guys keep selling rallies all the time and the stocks phase down in spite of how as strong as our balance sheet looks, then it's going to put pressure on these guys. And if it goes long enough, you are going to see some people get slowing up. Geoff Kieburtz - Weeden & Co.: And are you thinking that the... in most cases the current project owner is going to actually have to go through a bankruptcy process? Or are there opportunities for you to go to the customer, go to the shipyard and strike a deal without having to go through the somewhat time consuming process of bankruptcy?

Well the answer to that is I don't know and the other part of the answer is it depends on the deal. There maybe, there maybe some of this things that are contracted bad. But if the project is been asked with just regular debt though the financial institution or bank, we may be able to negotiate the deal with the bank, for a discount on the paper. It may make it work for us. There maybe opportunities if an operator meets a rig bad enough that we maybe able to go to or somebody else or some other sales contractor maybe able to go in and renegotiate the terms of the deal with an operator, who may need the rig badly enough who'd be willing to pay a better rate. So, I mean it's, there is almost an infinite... there is as many scenarios that our rigs that make them available. And so there is a lot of, there is a potential gallows [ph] here. And so you have got to look hard at all of, there is a lot of due diligence that goes with any one of these deals. Geoff Kieburtz - Weeden & Co.: A completely separate question, you mentioned earlier that the Butler and the Walker where you where looking for an opportunity to move them out of West Africa. Where would you think the most appropriate markets for those two exist today?

Well the easy answer is the Butler. If we follow PEMEX, we bid the Butler into PEMEX on the most recent tender. But we have actually did the rig in other markets as well. We've got offers and we have got some opportunities for the Walker in and around West Africa and other market for that rig being it's 150 foot, it might else would be in the Middle East. There is not a lot of deepwater over there and they might be opportunities over there. So there are lot of opportunities around. I don't want to get too specific, because I don't want Danny Adkins might be listening. He might need a job. So I don't want to get too specific about that, but there are opportunities for rigs around there. We are not at all bashful about bidding rigs from one market to the next. We may be bid rigs out of West Hampton, the same kind bid rigs in the West Hampton depending on trying to right size rigs for the right job. But those two specific rigs probably look better someplace where than they are at right now. Geoff Kieburtz - Weeden & Co.: Thank you.

You bet.

Your next question is from Robert Mackenzie with FBR Capital Market. Robert J. Mackenzie - Friedman, Billings, Ramsey & Co., Inc.: Afternoon guys.

Afternoon.

Hi. Robert J. Mackenzie - Friedman, Billings, Ramsey & Co., Inc.: My question actually ties back to the CEO, you just mentioned on that call you talked about cancellation clauses or out clauses in some of that contracts particularly, jackups in the North Sea, most of which have 120 to 180 day out clauses. Can you run through region-by-region, we already know Mexico, by statute where you might have out clauses including addressing some of your Petrobras rigs in that front?

Mexico is it. You answered the question. Robert J. Mackenzie - Friedman, Billings, Ramsey & Co., Inc.: So everything else is take your packs [ph]?

That's correct. Robert J. Mackenzie - Friedman, Billings, Ramsey & Co., Inc.: Okay, great. Even... how about stuff you are bidding on right now. Is that basically your policy that you're not going to accept that kind of contracts even if it required --

Our rates haven't gone down. So our expectations in terms likewise is not changing. Robert J. Mackenzie - Friedman, Billings, Ramsey & Co., Inc.: Fair enough. That was it for me. Thank you.

Thank you. Is that a good answer? Robert J. Mackenzie - Friedman, Billings, Ramsey & Co., Inc.: Perfect answer.

Your next question is from Pierre Conner with Capital One.

Good afternoon, gentlemen.

Good afternoon.

Hey, first question is a little bit of follow on to that and while we are pretty comfortable and confident with the customers and their balance sheets and their strength in the terms of your contracts. David, in your experience there has been ups and downs in the markets and customer may just come back and trade a little bit in terms of term and rate. So I wondered what experiences have you had that you could point to? I think that's, maybe the bigger concern in the market, not that people would walk away from contracts, but they might come knocking on your door at some price or commodity in some duration. What kind of experience have you had in that realm? What's sort of your take on that now?

Well, we have been in business for long time and there is a lot of experience in this room. There is lot of experience in our company. So we've seen people come back and ask for that. I have yet to see in my career an opportunity that an operator come ask for something that there was a give and take. If somebody comes up and offers five years at a lesser rate, would we look at it, of course we would. Would we give the store away because we are afraid of that guy, no. If he walks, he is going to get sued. That's fair rep in the story. I have had one customer in my career try to walk a contract, he found himself in court and he lost and he lost large. So well undated few years ago, I have been involved with that before, it's peak customer say with... before the litigation we can't work in rigs and my answer to that is with all due respect, we don't repay as we launch a business. So we have no intention to let anybody off the hook. If there is something for shareholders or there is something in it of value to us strategically or otherwise, we will look at it, but we have no intention just anybody off the hook.

But, in some cases you could work on term or additional rigs?

If somebody wants to come in and offer us three year contracts, the Don Walker and it's working at $160,000 a day now, we would renegotiate that for three years, you bet, all day long. It's a 150 foot rig. We really push the top into the... well above really what the market was and we did that job. So you bet we would. Whether we would do it for 40, absolutely not. So it just depends on what he has got to offer and what we've got to give. But I can assure you we are not going to hang on here, and say, 'Gee you are our customer and we won't be nice to you'. We won't do that. I mean we have our own shareholders, one thing that I... we are big on around here. We are not going to make their problem our problem and we're going to hold that feature far.

Good. And one my follow-up is somewhat related in it, you are in an interesting position with watching some of those speculators and I appreciate the image of them coming to the door on their knees by the way.

Everybody around here is looking at me like I'm crazy.

You are in a position of watching them and yet you also have three options for slots yourself. And so obviously, my question is related to your ability towards straight those, those slots and they are at fixed price. I think you just answered that question earlier, but what's your position there relative to not likely someone to step right in behind you if they are not... if you don't take them?

I don't know I mean it's we, I can tell you the Globetrotter, we really like it. It is from a technology standpoint it is and from an efficiency standpoint. It is fantastic. It will be cheaper to operate for our customers because it's got smaller footprint. The cost, the fuel cost the thrust required to maintain station, to move the rig and operate the rig is very efficient. We like it. So I would like to think we will get a chance to do those and having said that adding capacity is not necessarily in everybody's best interest long-term. So if we have other opportunities that match up with that we have to look at it. I can't yet tell you where we are going to land on which way will we go, it depends on what the opportunities look like and when they come on the door and when we start nailing some Globetrotter stuff. We've got right now, I mean we could easily get with the conversation we have ongoing today. We could easily get a couple of these things done in the next couple of months. So and if we have customers that are willing to take them back them up and with contracts that we like, I think we're likely to do them, because I still again don't see anything out there that we go up and pick up and buy. That's as efficient from an operating standpoint or from a capital standpoint as these rigs are.

Okay. And remind me, they were at the time you had 90 to 180 days on the three other options is that right?

It's about 30 day, those are and that was about 30 days stale. So it is right now, I think its 60, 90 and 150 days that we still have standing on the priced piece.

Got it. Okay. Thanks gentlemen.

Thanks, Pierre.

Your next question is from Judd Bailey with Jefferies. Judson E. Bailey - Jefferies & Co.: My questions have been answered. Thank you.

The next question is from Dan Boyd with Goldman Sachs. Daniel Boyd - Goldman Sachs & Co.: Yes, thank for taking my question. David, I have a question for you. With the Petrobras situation, given that they have those rigs blocked in for 30% to 50% discount from what other rates we've seen from more established contractors. Do you think there is a scenario where Petrobras actually helps kind of rescue these companies or does something to help them get financing and is there anything potentially political with the Brazilian government they could help persuade that they haven't?

Petrobras at least as far as I know has not historically been want to go in the range financing. They have been very, very supportive of indigenous Brazilian companies and Brazilian commerce, as you know as they should. They are pushing very hard try to get contractors to build rigs in Brazil and they've again been very supportive to the local Brazilian contractors. To date at least as far as I know, they have not gone so far as to underwrite financially those investments. So that's a question I can't answer Dan. I don't know. I think it's unlikely given their history. I think they have their own use of capital and even through their cost to capital is going to be like years ahead of what there the people are trying to underwrite would be I think they have probably got their own capital needs before they do that. Daniel Boyd - Goldman Sachs & Co.: Yes.

But, I can't speak to that. It will be unlikely. I would think but -- Daniel Boyd - Goldman Sachs & Co.: Okay.

Who knows. Daniel Boyd - Goldman Sachs & Co.: I guess that they have at least on the sale lease pack of Transocean, so they do... they have taken some interest or --

They did it at one-time and, they've done it once. I think it was more of financial engineering exercise and they are trying to rescue drilling contract. I don't think Transocean needed that. Daniel Boyd - Goldman Sachs & Co.: Yes, I agree with that. Then last one for the unrelated, kind of I going back to comments that Baker Hughes made. They said that they expected a flat rig count in Saudi from here. And I know that Saudi has a fresh tender out with four jackups. I think three of them are oil related and probably suggest to me that they are going to be on the Miniso project [ph]. Kurt, do you have anything to add on above these four tender for four jackups? Do you see any additional demand that Saudi might need over the next year?

Dan I will tell we see right now, its in front of us. There is no ways that they could have increased by another three to seven. But we haven't actually seen it yet. But what we are seeing in front of us is currently what we are bidding on. Daniel Boyd - Goldman Sachs & Co.: Do you have a timeline on when those tenders might be awarded? And how many rigs are you actually bidding on that the four?

We did a total of three into the four rig package. And we've made it so forth to every level of their process as far as well as approving and evaluating the tenders. What we are hearing out of Saudi is that it's probably going to be sooner than later. But I mean this process my gosh its gone on for a long time, longer than we had expected. But I would certainly think that mid of November we might have something.

In November possibly. Daniel Boyd - Goldman Sachs & Co.: Okay. Thanks a lot. I appreciate it.

Welcome.

Operator?

The next question is from Arun Jayaram with Credit Suisse. Arun Jayaram - Credit Suisse Securities (USA) LLC: Good afternoon. Had a bit a couple of quick questions. Kurt and you were discussing with Petrobras assuming some of these rigs do not get completed. Do you think that have a preference for existing rigs, meaning timing is more important or do you think they had still, I want to look towards new build?

I think both are in, I think they are still have an appetite for existing rigs, certainly in the 1200 to 1500 meter range. But they also have an appetite for new builds as well specifically once it can be of delivered in the 2011 timeframe. We are certainly in discussions with them on that and we'd hope to see some additional opportunities there. Arun Jayaram - Credit Suisse Securities (USA) LLC: Okay. And Kurt in your discussions with them do you think there could be a shift in terms of the timing? I think they had originally talked about 40 incremental rigs or 12 being awarded. Do you think this could shift the timing in terms of the tender for the remaining 28 rigs?

I don't know if they can shift the timing. I think Petrobras is confident in when they want these rigs to walk right into Brazil. I think what their biggest concern is right now is to your point of the 12 that has been awarded, if actually all 12 of them are going to be delivered based on the discussions we have had earlier on this call. Some of those speculative contractors, Brazilian contractors may have difficulty delivering those. We know from talks that Petrobras that they are concerned about that. So I think right now it's not so much timing issue, but it's all they are going to be able to get the incremental rigs that they have contracted for. Arun Jayaram - Credit Suisse Securities (USA) LLC: And my last question real quickly, David you mentioned that you are monitoring the situation in China in terms of the new bills with the Olympics etcetera. Any update in terms of the impact to new bills post the Olympics?

Well the Olympics are over. And you might have read that in the papers. I am sorry I don't want to mess with you. They said they are going to shut us down for effectively two days a week leading up to and during the Olympics which they did, but what they told us they won't be able to do... that they were able to do is achieve some other power sources in the yard to keep work kind of stream along. And so the net impact was... there was some impact but it was effectively de minimis. I mean has do was finished and finished really when they expected to be finished. The spot market is actually ahead of schedule. So it actually was... if we hear news or we see something that scares us, we are going to tell you about it and we told you about that because it was news to us and we felt like that we could get better in the market just in case. But the net effect was really not very big. Arun Jayaram - Credit Suisse Securities (USA) LLC: Okay, thank you.

The next question is from Mike Urban with Deutsche Bank.

Thanks, good afternoon. The North Sea market suggest or sounds pretty strong prospectively though that is an area that if we would point it out maybe susceptible to some weakness. One, do you agree that that is a possibility given lot of smaller operators and then more price sensitive? And two you were a little better insulated I know in the past they have seen some unique equipment and some markets of that design that has helped a little bit so we'll just be interested on, some color on that?

The beauty of the North Sea market, it's effectively closed. I mean most of the rigs are under construction or not currently active in the North Sea really can't go to that market. So all it's got to do really is just kind of maintain, is it susceptible to downturns, of course, if you see a long-term impact from what's going on in the world on product pricing you see oil go low, gas go low and stay low that, that's going to hurt that market. But at current levels I just don't see it. You are very correct in so far as we are very well insulated because of our, we book effectively through the next year in the North Sea until very late. So we are actually in very good shape with end market but oil still hovering in and around $70 a barrel that's still above where most of the new build activity was conceived. So any market is going to be susceptible to long term pressure on product prices but at this levels and with that market I just don't see it yet.

Okay, that's helpful. And kind of an unrelated follow-up by going back to the Globetrotter class rigs. Something that the plan kind of an innovative one to complete the rig in stages and then moving around a little bit between some yards. How do you manage that process in terms of vendors or yards being late in another words boarding the issue to many cook in the kitchen then probably and that causing cost overruns or delays?

We have effectively a three part agreement, between ourselves and the two primary vendors STX being one, Housemen being the other and we have uniformity and... uniformity in project management and uniformity in contract appliance. That effectively has already started, Housemen has got people in yard in China and the Chinese people have people owned station in the yard where we do the outfitting in Holland. So the way we've done is by contracts and there are... the contract has Ts and the onus is on the on the subcontractors over the primary contractors not all know one can say. The onus is how management perform and the contracts got T. So our expectation is that this marriage was made very early, it was formalized by contract and the way the partners are behaving and I think we're actually in very, very good shape in that process. Then keep in mind both of these guys, desperately want to get this opportunity off the ground with Noble and so they are highly incentivized just from a STX starting up in New York and Housemen came in out with new generation of kit. They are highly motivated to perform at a very high level under this contract. So our expectation is very positive.

Great, that's helpful. Thank you.

Thank you.

Let's take one more question and then we are going to close out.

Yes sir. Your next question is from Michael Drickamer with Morgan, Keegan. J. Michael Drickamer - Morgan, Keegan & Company, Inc.: Good morning, guys. Just trying to reconcile your comments between dozen Globetrotter class rigs and then looking at some of the M&A opportunities. How much of this decision is a purely economic decision. We're perhaps having the M&A opportunities available sooner as lot of value versus, how much of is it technical decision versus where plus how's is the spec of the Globetrotter rig offers to longer-term value?

Well, okay. We like the technology in the Globetrotter but make no mistake, we are in this for the money. And as long as we can add value for our shareholders that's what's going to be the primary driver of what we do. If we can go out and purchase a rig that economically provides a better return to our shareholders over and above what we deliver Globetrotter for then we'll have to go that route. If the prices of the rigs that we might seize potential targets out there continue to be a 100 and more million dollars away and the deliverability of those assets is not materially different then we may go Globetrotter, but we are drilling contractor we punch holes in the ground for money for our shareholders that's all we do. And so that evaluation it's a map for our move. It will comedown to a financial evaluation of what makes the most sense. J. Michael Drickamer - Morgan, Keegan & Company, Inc.: Okay. Then comment on related follow-up, will your competitors of course is looking to re-domicile the source, just tell me you guys have looked at analog?

We certainly are aware of the pros and cons of being closer to the operations in the tax consequences, benefits either way of that. And it's yes, I mean as a drilling company, we are very well aware of that and we will have to undertake and review all options including that which transactions with that, So, yes, we are aware of it. J. Michael Drickamer - Morgan, Keegan & Company, Inc.: Right. Thanks a lot guys.

Thank you.

All right, ladies and gentlemen thank you very much for joining our third quarter call. The next call will be at the end of January to review our 2008 full year earnings. As always Brooke and I will be available here in the office to answer any follow-up questions you might have and we are aware today there are several of you in the queue who did not make it through to ask questions and we will be happy to get back with you as well. So thank you again.

Ladies and gentleman, thank you for participating in today's conference. You may now disconnect. .