Noble Drilling Announces 3Q02 Results

Noble Corporation reported net income for the third quarter of 2002 of $49.2 million, or $0.37 per diluted share, on operating revenues of $234.7 million, compared to net income of $77.0 million, or $0.58 per diluted share, on operating revenues of $272.8 million for the third quarter of 2001. Net income for the nine months ended September 30, 2002 was $158.0 million, or $1.18 per diluted share, on operating revenues of $717.6 million, compared to net income of $199.4 million, or $1.48 per diluted share, on operating revenues of $741.8 million for the nine months ended September 30, 2001. The Company repurchased 755,000 of its ordinary shares at a total cost of $23.0 million during the third quarter of 2002. Since the third quarter of 2000, the Company has repurchased 4,451,000 of its ordinary shares at a total cost of $149.7 million. At September 30, 2002, the Company's consolidated balance sheet reflected $1.95 billion in shareholders' equity, $187.6 million in cash and cash equivalents, and $560.4 million in total debt.

James C. Day, Chairman and Chief Executive Officer, said, "Activity levels in the U.S. Gulf of Mexico, and to a lesser extent the North Sea, have continued to be weak even with improved oil and natural gas prices."

Offshore contract drilling services revenues from deepwater drilling units (capable of drilling in 4,000 feet and greater) accounted for approximately 31 percent and 36 percent of the Company's total offshore contract drilling services revenues for the third quarter of 2002 and 2001, respectively. The Company currently operates five deepwater semisubmersibles in the Gulf of Mexico and one deepwater semisubmersible and three deepwater drillships offshore Brazil. Offshore contract drilling services revenues from international sources accounted for approximately 67 percent and 54 percent of the Company's total offshore contract drilling services revenues for the third quarter of 2002 and 2001, respectively. Results for the third quarter of 2002 were adversely impacted by continued soft market conditions in the U.S. Gulf of Mexico. The average dayrate for the Company's domestic jackup rigs was $30,759 in the third quarter of 2002 compared to $54,594 in the third quarter of 2001. Utilization on these rigs increased slightly from 91 percent in the third quarter of the prior year to 93 percent in the third quarter of this year. In addition, average dayrates and utilization on our deepwater assets in the U.S. Gulf of Mexico decreased in the third quarter year-on-year. The average dayrate on these units was $118,135 in the third quarter of 2002, down 18 percent from the same quarter of the prior year. Likewise, utilization of our domestic deepwater assets decreased from 95 percent in the third quarter of 2001 to 82 percent in the recent quarter. However, dayrates in certain international markets, especially the North Sea, the Middle East and West Africa were higher in the third quarter of 2002 than the same quarter of the prior year, which more than offset lower utilization internationally. The average dayrate for the Company's international rigs was $62,355 in the third quarter of 2002 compared to $57,672 in the third quarter of 2001. Utilization on these rigs decreased to 92 percent in the third quarter of 2002 from 96 percent in the third quarter of the prior year. Day said, "As noted in our first and second quarter releases, activity levels will not appreciably improve until the economy begins to show some signs of rebounding. Preliminary budget surveys do not bode well for a turnaround in 2003. However, Noble is well positioned with its balance sheet, personnel and premium equipment to reap the rewards of increased activity levels. Our disciplined management team has not chased after ill-advised acquisitions or speculative new builds betting on a more robust market, resulting in the highest return on capital in the sector."

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