Marine 700

Marine Drilling Companies and Esso Exploration have agreed to submit to arbitration for the determination of the dayrate for the Marine 700 for the upcoming year. Upon the final decision, the new dayrate will become effective from August 5, 2000. The contract between the two companies provides for an annual review of the dayrate with the potential to increase the rate from a base of $130,000 plus adjustments based on current market rates for comparable equipment subject to certain caps. The contract expires on August 4, 2004 with the cap for the upcoming year being $165,000 plus adjustments.