Diamond Declares Special Cash Dividend of $1.25 Per Share

Diamond Offshore (NYSE:DO) has declared a special cash dividend of $1.25 per share of common stock and a regular quarterly cash dividend of $0.125 per share of common stock. Both dividends are payable on December 3, 2007, to shareholders of record on November 2, 2007.

The Company’s Board of Directors, commencing this quarter, has adopted a policy of considering paying special cash dividends, in amounts to be determined, on a quarterly basis, rather than annually. The Board noted that any determination to declare a special dividend, as well as the amount of any special dividend which may be declared, would be based on the Company's financial position, earnings, earnings outlook, capital spending plans and other relevant factors at that time. The Company’s Board had previously stated its willingness to consider paying special cash dividends on an annual basis.