EXHIBIT 99.1


FOR IMMEDIATE RELEASE                               CONTACT:  LES VAN DYKE
                                                    DIRECTOR, INVESTOR RELATIONS
                                                                  (281) 492-5370

                    DIAMOND OFFSHORE DRILLING, INC. ANNOUNCES
                              NEW LETTER OF INTENT

Houston, Texas, August 10, 2005 -- Diamond Offshore Drilling, Inc. (NYSE:DO)
today announced that it has entered into a Letter of Intent (LOI) to utilize the
4th generation semisubmersible Ocean Valiant in the Gulf of Mexico for a period
of one year commencing in mid-March 2006, with an option to extend the work at a
mutually agreeable rate and term. Maximum total revenue under the LOI for the
initial one-year term would be approximately $111 million. The LOI is subject to
customary conditions, including the execution of a definitive agreement, and
actual revenues received could be reduced by various operating factors including
utilization rates.

Diamond Offshore provides contract drilling services to the energy industry
around the globe and is a leader in deepwater drilling. The Company's fleet of
44 offshore drilling rigs consists of 29 semisubmersibles, 14 jack-ups and one
drillship. Additional information on Diamond Offshore Drilling, Inc. and access
to the Company's SEC filings is available on the Internet at
www.diamondoffshore.com.

Statements in this press release may contain "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. Such statements
include, but are not limited to, statements concerning commitments for drilling
work or contracts, future dayrates, future contract revenues, the term and start
date of future contracts, entry into definitive agreements, consummation of
awarded contracts, satisfaction of conditions precedent, future growth in demand
for equipment types or in any region, future cash flows, and future contracts.
Such statements are inherently subject to a variety of risks and uncertainties
that could cause actual results to differ materially from those anticipated or
projected. A discussion of the risk factors that could impact these areas and
the Company's overall business and financial performance can be found in the
Company's reports and other filings with the Securities and Exchange Commission.
These factors include, among others, general economic and business conditions,
casualty losses, industry fleet capacity, changes in foreign and domestic oil
and gas exploration and production activity, competition, changes in foreign,
political, social and economic conditions, regulatory initiatives and compliance
with governmental regulations, customer preferences and various other matters,
many of which are beyond the Company's control. Given these concerns, investors
and analysts should not place undue reliance on forward-looking statements. Each
forward-looking statement speaks only as of the date of this press release. The
Company expressly disclaims any obligation or undertaking to release publicly
any updates or revisions to any forward-looking statement to reflect any change
in the Company's expectations with regard thereto or any change in events,
conditions or circumstances on which any forward-looking statement is based.
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