EXHIBIT 99.1
FOR IMMEDIATE RELEASE CONTACT: LES VAN DYKE
DIRECTOR, INVESTOR RELATIONS
(281) 492-5370
DIAMOND OFFSHORE DRILLING, INC. ANNOUNCES $1.2 BILLION
OF SIGNED AND PENDING TERM FLOATER CONTRACTS
Houston, Texas, May 24, 2005 -- Diamond Offshore Drilling, Inc. (NYSE:DO) today
announced that it has two signed and five pending term contracts that would
provide total combined revenue of up to $1.2 billion over the lives of the
contracts. The work will be performed in the Gulf of Mexico, Brazil and the U.K.
sector of the North Sea. Diamond Offshore has not yet entered into the pending
contracts, and all of the pending contracts are subject to customary conditions
including execution of definitive agreements.
Of particular note, in the Gulf of Mexico, the Company received a letter of
intent for a two-year term contract utilizing the Ocean Confidence for deepwater
operations at a competitive market rate. In Brazil, Diamond Offshore has been
notified that contracts are being renewed on the Company's fleet of four
deepwater rigs operating in that market for terms of four years each (five years
for the Ocean Clipper) at dayrates that could generate total revenues of over
$880 million, excluding potential bonuses.
Larry Dickerson, President and Chief Operating Officer, said, "These
developments demonstrate the continuing growth in demand for mid-water and
deepwater equipment seen in markets across the globe. New dayrate highs have
been achieved for term work utilizing 4th and 5th generation rigs in the U.S.
Gulf and for mid-water rigs in the U.K. sector of the North Sea. In Brazil, we
are extremely pleased to receive contract extensions for substantial terms at
dayrates reflecting today's vibrant market. Diamond Offshore expects these seven
contract awards to provide a solid stream of future revenue and cash flow into
2006 and beyond."
The following table summarizes some of the terms of the contract awards that are
expected to be included in the definitive agreements:
<Table>
<Caption>
- --------------------------------------------------------------------------------------------------------------------------
MAXIMUM CONTRACT POTENTIAL BONUS ESTIMATED
CONTRACT REVENUE (2) REVENUE (3) CONTRACT
RIG STATUS (1) LOCATION ($ 000'S) ($ 000'S) START DATE TERM
- --------------------------------------------------------------------------------------------------------------------------
Confidence LOI US Gulf $204,400 - Early Jan. 2006 2 years + option
- --------------------------------------------------------------------------------------------------------------------------
Victory Signed US Gulf $74,825 - Mid July 2005 1 year + option
- --------------------------------------------------------------------------------------------------------------------------
Clipper NOCA Brazil $328,500 $16,425 Mid Dec. 2005 5 years
- --------------------------------------------------------------------------------------------------------------------------
Alliance NOCA Brazil $226,300 $45,260 Early Sept. 2005 4 years
- --------------------------------------------------------------------------------------------------------------------------
Yatzy NOCA Brazil $167,900 $28,543 Early Oct. 2005 4 years
- --------------------------------------------------------------------------------------------------------------------------
Winner NOCA Brazil $160,600 $8,030 Mid March 2006 4 years
- --------------------------------------------------------------------------------------------------------------------------
Guardian Signed U.K. $58,400 - Mid March 2006 1 year + option
- --------------------------------------------------------------------------------------------------------------------------
TOTAL $1,220,925 $98,258
- --------------------------------------------------------------------------------------------------------------------------
</Table>
1) LETTER OF INTENT; NOTIFICATION OF CONTRACT AWARD
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(2) GENERALLY, RIG UTILIZATION RATES APPROACH 95-98% DURING CONTRACTED PERIODS;
HOWEVER, UTILIZATION RATES CAN BE ADVERSELY IMPACTED BY ADDITIONAL DOWNTIME DUE
TO UNSCHEDULED REPAIRS AND MAINTENANCE.
(3) BASED ON ACHIEVEMENT OF CERTAIN PERFORMANCE CRITERIA.
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
45 offshore drilling rigs consists of 30 semisubmersibles, 14 jack-ups and one
drillship.
Statements in this press release 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, potential bonus 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, including, among others, the risk that a
notification of contract award, letter of intent, or verbal contract commitment
may not result in a binding contract, the risk that a binding contract could be
terminated, the risk that the markets for the Company's services will not
continue to improve, or the risk that factors outside of the Company's control
may adversely impact the amount of profit realized from a contract. A discussion
of additional 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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