Good day, everyone, and welcome to the Ensco International Fourth Quarter Earnings for 2009 Conference Call. As a reminder, this call is being recorded and your participation constitutes consent to its taping. I will now turn this conference call over to Mr. Sean O'Neill, Vice President of Investor Relations who will moderate the call. Please go ahead, sir.

Good morning, and welcome to Ensco's fourth quarter 2009 conference call. With me today are Dan Rabun, CEO; Bill Chadwick, our Chief Operating Officer; Jay Swent, Chief Financial Officer, as well as other members of our executive management team. We issued our earnings release which is available on our website at enscointernational.com. Later today, we plan to file our SEC Form 10-K. As usual, we will keep our call to one hour. Any comments we make about expectations are forward-looking statements and are subject to risks and uncertainties. Many factors could cause actual results to differ materially. Please refer to our earnings release and SEC filings on our website that define forward-looking statements and list risk factors and other events that could impact future results. Also, please note that the company undertakes no duty to update forward-looking statements. As a reminder, our monthly rig status report was issued on February 16th. Now, let me turn the call over to Dan Rabun, Chairman and CEO.

Thanks, Sean, and good morning, everyone. Jay and I are in our new headquarters in London today. Before Jay takes us through the financial results, I would like to start by providing some color on fourth quarter and full year highlights, the state of our markets and our current outlook. On December 22nd of last year, we achieved an important milestone in Ensco’s history. Shareholders approved our re-domestication to the United Kingdom and virtually the entire senior executive management team is in the process of moving to London. The company, customers and shareholders are all expected to benefit from the relocation to the U.K. Executive management oversight will improve from a more centrally located global headquarters in London. We will be closer to more of our major customers and we expect to achieve a global effective tax rate comparable to our competitors domiciled in Europe. The move to the U.K was a very logical next step for Ensco. We’ve operated in United Kingdom for sixteen years. We have more than 400 employees in the country supporting our North Sea operations. In 2009, U.K revenues exceeded those in the U.S. Virtually all of our executives moving to the U.K have worked outside the U.S. previously on long-term assignments, so we anticipate a very smooth transition. Another major achievement for 2009 was our safety record. Last quarter I underscored the importance of safety and its strong ties to operational excellence, reliability and customer satisfaction. I’m extremely pleased that our rig crews and the entire workforce achieved the lowest instant rates in our history last year, which were also better than the industry averages. I should mention that the IEDC industry average also improved significantly in 2009, which is great to see for our industry. Now let me turn to our operations. I’ll…

Thanks, Dan. My comments today will cover Ensco’s re-domestication to the U.K, details of fourth quarter results, our outlook for the first quarter and full year 2010 and a review our financial position. As Dan mentioned our re-domestication to the U.K. is a pivotal event in Ensco’s history. Over the past year the U.K. government has taken major steps to attract and retain large multinational companies like Ensco through more progressive tax policies. Since some of these changes are relatively recent and not yet fully known in the marketplace, I will take a few moments to discuss our move to the U.K. The most frequent questions raised by investors today seems to fall under three basic categories. First, why move to the U.K. and not Switzerland like some of our competitors. Secondly, isn’t the U.K. taxation system similar to the U.S.? Third, will there be significant cost associated with restructuring operations and establishing a headquarters in the U.K. Let me start with why we choose the U.K. First and foremost, as Dan mentioned, the U.K, and London specifically is an ideal location for our new headquarters, especially when you consider our global footprint. Secondly U.S. tax rules severely limit our U.S company’s ability to re-domesticate and one of the few ways that this can be as accomplished is to relocate to a country where you have substantial business activities. Our extensive North Sea operations uniquely qualify us to re-domesticate to the U.K. Just to quantify this for you, during 2009, 86% of our revenues were generated outside of the U.S. and our U.K revenues exceeded the U.S. by a meaningful amount. The last point I would make on this topic is that we are in the process of restructuring our operations to be managed more globally. When this process is…

Thank you, Jay. Operator, we can now open it up for questions.

(Operator Instructions). Your first question comes from Robin Shoemaker - Citi.

I wanted to, Dan, ask you about, you mentioned a lot of tenders against incumbent rigs in several of the markets that you are anticipating. I wonder if you could just address where you see growth in jack-up markets globally, excluding tenders that are against incumbent rigs in those markets. It sounded like Indonesia is one area, but what about that market and a few others where you see real growth.

Hey Robin, let me refer that over to Mark Burns whose is head of our international jack-up operations, he is poised best to address that point.

Yes, as Dan mentioned in his opening comments, there’s several areas where we see potential growth. Looking at South East Asia, Indonesia has been very active in the fourth quarter and we look for it to continue to be active in the early part of the year, Vietnam is an another area and also Malaysia we have seen some indication of increased activity, bidding activity in Malaysia. Going into the middle east again it continues to be a rig market. Robin, there is currently 20 plus jack-ups idled there, we don’t see a lot of incremental activity there in the near future. India, certainly the ONGC tender that just came out against the seven incumbent tenders and that is another area that we’re going to see some activity. As for as you know new jack-ups will be delivered in 2010, currently Robin, we anticipate 29 new jackups to be delivered, that will also put pressure on various markets. So far, we’ve seen some good absorption of the new build jack-ups. So, there are some positive growth areas and we’ll continue to monitor those.

Was Mexico one of the markets where you see tenders against incumbents or actual growth?

The tender that has been indicated will be issued shortly in Mexico is basically against incumbent rigs, but PEMEX has also indicated some new contractual specifications for the rigs it will accept. So, there is a belief if PEMEX holds to those standards that the incumbent rigs will not necessarily qualify for the forthcoming contracts, so that the number of rigs will remain constant or hopefully increase, but the actual rigs that are contracted in Mexico will change.

So that was the one where they are specifying the rig can only be a certain number of years old, like built after a certain date?

That's correct.

Your next question is from Brian Uhlmer - Pritchard Capital.

I had a couple of quick questions, first off, really on the operational cost fronts, as some of the other contractors, it has been kind of mixed throughout this quarter's reports of keeping cost in line. How do you see those heading out, not just in 2010, but as we move through the year, as rigs start to come back to work?

I think as we look at 2010, the way I would describe the dynamics of our business, Brian, is the operating days in the jack-up business are going to be fairly similar year-over-year. As I said in my comments, we expect contract drilling expense to come down about 8% in the jack-up business, our operating days in the deepwater business are almost double. And so, our expenses are going to go up quite significantly there. When you look at it all on kind of weighted average basis, I think our contract drilling expenses going up 6% year-over-year, that’s really driven by the large amount of additional days where we are adding in the deepwater business. Relative to inflation, we’re assuming pretty constant cost year-over-year, we're continuing to take cost out of the jack-up business and turn that up as much a we can to the utilization that we see for the year, but at the moment, we don’t see a lot of cost pressure in the business. Does that the answer the question for you?

Yeah, because we are looking at more of a per rig basis on the jack-up front that you are not actually seeing increases in that segment.

If you do the math on our year-over-year number, our cost per day is coming down fairly meaningful.

Okay. And then secondly unrelated, when we look out at your dividend and how are you guys looking at that versus your committed CapEx and your growth plans, if you see room for increasing that or doing something else with your cash flow?

Well, this is Dan, how are you doing? Our answer to that is really consistent with what we have said previously with the exception that we are feeling a lot better about the economic and banking climate that we have in our previous quarters. In addition we only have about one-third of the 8500 series capital commitments remaining to fund, so we had still less working capital pressure then we had previously. But that being said, we still have 1.1 billion of remaining Ensco 8500 series CapEx commitments. So our current focus is executing on our deepwater program to generate organic growth. And beyond the 8500 series program, we continue to proactively search for other opportunities to extend the deepwater fleet. As we have said in previous quarters, if we can’t identify new investment opportunities, our board continues at every board meeting to evaluate opportunities to return capital to shareholders, either in the form of dividends or share repurchases, but this of course is a board-level decision. I would like to say that we have spent a great deal of time in the last three to four months soliciting the views of our major stock holders on this issue and we are very mindful of their thoughts on this matter. And I will say that there also continues to remain an extreme diversity of views on this subject among our shareholders.

Your next question comes from Pierre Conner - Capital One Southcoast.

Maybe Mark and Dan, I’ll put you on the spot for a follow-up from a comment yesterday, Transocean on rates and arguably you might be better qualified actually, but the answer, they commented about incremental pricing and some premium for rigs in certain markets, so would you agree with that and would you describe if that is the case the character of that as what kind of increases or just costs or changes that you are seeing.

I'm sorry, are you talking about jack-ups or?

Yes, yes specifically.

Let Mark talk about that, because it is an interesting dynamic going on in the marketplace, specifically out in Asia.

Yes, Pierre, I think to answer your question, if I understood it correctly, I think it’s what kind of processing dynamics we’re seeing in Southeast Asia, was that the question Pierre?

Yes, Mark, they commented in some markets they are seeing some improvement in pricing and so my question about the character of that less…

I think that is the case, it is interesting, particularly in Southeast Asia. As these new builds continue to come home, we’ve seen the rates actually stay up fairly strong, particularly in Southeast Asia. I think we’re going to continue to see, as we’ve seen, we’re going to see pressure put on the lower spec jack-ups and those will eventually, there will be more pressure to put the lower spec units to work, but we are seeing, particularly in Southeast Asia, we’re starting to see or have seen rates fairly stable. And again, as I mentioned earlier, we’re starting to see additional activity in Vietnam, potential additional activity in Malaysia, so that’s also helping strengthen that market.

And that leads right into what my follow-up was about, it was really what you are seeing in terms of the character of the bidding from these additional -- you commented 29 that are coming. Do you see that those rigs are actively being dead right now or are we expecting a wave of additional availability coming. How much of that is in the bid market from what you can tell, those 29 that are coming this year?

Yes, of the 29 units that are coming this year, 11 currently have contracts. In addition, several of those additional units will be going to non-core operating areas that we are not operating in. So, we’ve seen some fairly good absorption of the rigs, they will, the new builds will however continue to put pressure on rigs. In Indonesia, again we are starting to – we have seen increased bidding activity and it’s really looking for the newer rigs, although we’ve been successful in keeping our lower-end jack-ups working. So, I think based on that, we feel quite good about absorbing the majority of these jack-ups into the market in 2010.

And Pierre, I just can’t let it go without saying that four of those jack-ups are delivered in December and three of them are on December 31.

Good luck. I had an unrelated follow-up really, Jay, probably more for you and Dan, related to your earlier comment, Dan, about perusing flexibility of use of free cash. And does the relocation and as you described Jay some of the ownership, just add a wrinkle in terms of your flexibility to do that, will that be anything we should be aware of in terms of would cause your extra time to evaluate and change to be able to get that flexibility?

I don't think so, Pierre. I think maybe part of your question, because I know it's a question for the people in Switzerland, there are restrictions on dividends and share repurchase and that type of thing. And the answer to that question is, we are a U.K company and we are subject to the Companies Act, so there are some slightly different regulations, but we've tried to structure everything in the re-domestication process to give us maximum flexibility on both share repurchases and dividends. And I’d say we’ve really don't have any significant impediments that we didn't have before in that regard. There is a duty of care for directors that’s a little higher standard in the U.K around making dividend payments, given our financial situation, it wouldn’t have any impact on our ability to do them. And in terms of other questions on financial flexibility, quite frankly the structure that we’ve put in place gives us dramatically more flexibility with respect to working capital than we had before and we previously had to be very mindful of income that was earned outside of the U.S and income that was earned in the U.S and not overlap those funds. And when you get to a point where 86% of your income is coming from outside of the U.S that starts to become an impediment. So with the new structure, we are able to move working capital around pretty efficiently and really much better than we're able to on the old structure.

Your next question comes from Mike Urban - Deutsche Bank.

certainly a level of bids and tenders out there sounds pretty encouraging and it is pretty clear that it’s up versus where it has been, but are you able to categorize or quantify what the level is or how much it might be up versus where you might have been last quarter and maybe six months ago or whatever time period you want to use as the reference?

Mike, as I said, certainly during the middle part of 2009, the industry in terms of jack-up bids, we did see a low in jack-up tenders in the fourth quarter in certain parts of the markets that we operate in. We have seen increased bidding activity and into the first quarter of this year, we continue to see bidding activity and increased bidding activity. So, as far as quantifying it, I think it's good to see that there's been a steady number of enquires come out, which I think is positive for us.

Well, if you look at the historic trend lines over the last 20 years, as commodity prices have increased and stabilized, demand for jack-up and utilization have increased and we see nothing different about the dynamics that even - what we’ve see over the last 20 years of the cycle. So, I think to the extent the commodity prices stay in the neighborhood that they are, for the longer period they stay and our customers have confidence in the stability of those prices, I would fully expect to see more demand.

I would tend to agree. Kind of an unrelated follow-up, one thing that Ensco has always done a good job over the years is as you’ve added assets or upgraded the fleet and upgraded the quality of the fleet, you perhaps looked to your exits in some lower ends part of the business, and you are certainly seeing some of the lower spec jack-ups, maybe 250s and below struggle a little bit here. Is that something that you might to look to do again going forward here as you do deliver deepwater rigs into the fleet again kind of upgrading the quality of that asset base overall?

You are very familiar with our history and we’ve had a history of upgrading our fleet over long periods of time and we’ve got rid of the platform rigs, the lake barges. We got rid of some jack-ups over the years. So, we’re going to continue that trend. I mean our trend is towards the ultra-deepwater and to higher specification jack-ups and to the extent we see opportunities that we can place them of our other assets and we will do that.

Your next question comes from Geoff Kieburtz - Weeden & Co. Geoff Kieburtz - Weeden & Co.: Some of your peers have recently commented about the challenging nature of the deepwater market. As you look at your un-contracted your floaters, I mean how are you thinking about that market. Do you have any concerns?

This is Carey Lowe. We’re seeing a strong increase in tendering activities particularly in the last few months. I believe operators are becoming more and more comfortable with the oil price stability and are re-looking at their long term programs and developments and we’re seeing an increase in tendering activity and plus in places that are outside the traditional deepwater basin. And that tendering activity is for 2011 and 2012 project starts and that’s when our rigs become available. Geoff Kieburtz - Weeden & Co.: So, no comparable concerns to some of the other comments, do you think it’s just they are looking at 2010 and early 2011 more than?

I looked at some of the transcripts, and I think most of the references that they have made is 2010. There may be a few challenges and I think it’s just a holdover for what happened in late 2008 and 2009. These things have such a long lead time, so I think there’s just a little bit of hangover from what commodity prices and the financial crisis that we are going through. So, right now, our customers as Carey said, our belief is that, based on our conversations, they are getting much more confidence in commodity pricing and the long-term fundamentals. They're starting to plan these programs, which take long periods of time in advance to preparing and source rig demand and we see a noticeable up-tick in recent tendering activity and planning activity. Probably planning is a better way to characterize between tendering, because I think you all know what the outstanding tenders are, in terms of planning activity and inquiries from customers, we would fully expect based on the activity level that we are seeing, that we will see an up-tick in tendering activity as we move through the year. Geoff Kieburtz - Weeden & Co: We haven't really seen a lot of fixtures though so that I guess the West Gemini contract kind of figures may be more prominently that it should, but do you have any comments on the rate that the West Gemini was contracted at and as to whether it’s a reasonably valid barometer of the current market rate?

This is Carey, I think you have to look at each tender on its own. It depends on what the specifications are, what the terms are, where the project is and a number of other factors. And I just can’t say that one fixture is going to determine the whole market rate and I wouldn't, I really don't want to get too specific because we have open tenders right now. Geoff Kieburtz - Weeden & Co: If I could squeeze one last one in, just to clarify here, I think Dan you said that typically it takes several quarters of rising utilization in the jack-up market before you start to see increasing day rates, which I think is probably pretty true. You’re forecasting for 2010 that your jack-up utilization is going to essentially stay flat. Can we infer that you're not anticipating any rate increases until sometime past 2010?

I think what we’ve said, we think, we expect the markets to be fairly stable this year, and that’s how we see it right now and that is how we see it for the year.

And I think Geoff, we do see a slight up-tick in the second half of the year, particularly in the North Sea, where there is a lot of work that people want to do later in the year, but there is bit of a low right now.

I think we do anticipate utilization will start moving up, till we get later into the year.

I made comments about the 20-year history and looking at trend lines and what we've always seen historically and this appears to be no exception to the historic trend line, is that the U.S Gulf of Mexico catches the cold first and Asia-Pacific and the North Sea is the last one to catch the cold, and we are seeing the same thing. North Sea’s kind of stabilized and ramped down a little bit and is on its way, probably be on its way back here pretty soon.

Your next question comes from Ian MacPherson - Simmons & Company. Ian MacPherson - Simmons & Company: Just to catch up here on the cost guidance, I think I heard in the follow up Q&A that it’s essentially 6% higher in 2010 on an aggregate basis, is that correct?

That’s for both businesses together, that’s right, Ian. Ian MacPherson - Simmons & Company: Okay. Unrelated question, could you comment on, there was some industry press commentary about Ensco and Capital teaming together to work on low cost drill ship concept for Petrobras, is there anything to that that you’d want to comment on now or is it do you think that was overplayed in the press?

Well, we don’t comment. You all know, we actively peruse every opportunity that exists and I was surprised to see the article. Ian MacPherson - Simmons & Company: Your last couple of 8500 series that don’t have contracts, do you think that Brazil is a potential market for those?

It’s designed for that market, West Africa. Yes, it is a possible market for those rigs. Ian MacPherson - Simmons & Company: Have you bid them against the outstanding tender, I guess it’s a four rig tender from Petrobras last quarter?

It’s inappropriate for me to comment on that.

Our next question is from the line of Rob MacKenzie - FBR Capital Markets.

Thank you. Actually my questions have been answered.

Your last question comes from Joe Hill - Tudor, Pickering.

Most of my questions have been answered too or not as the case may be. But would you guys talk about you prospects for the 7500 post August and what you think about moving the rig?

Our contracts with Chevron actually extends into the fourth quarter as part of the demo. And as far as what we plan on doing with the rig, we’re looking for opportunities in many regions right now and are taking to people of that project.

Okay, would a move to Brazil make sense?

Many places we’re looking at.

Okay, thank you everyone for participating on our call today. And we will see you next quarter. Thank you.

That concludes today's conference call, we appreciate your participation.