8-K 1 f8kjul282006.txt =============================================================================== WASHINGTON, D.C. 20549 ------------ FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 DATE OF EARLIEST EVENT REPORTED: July 28, 2006 ATWOOD OCEANICS, INC. (Exact name of registrant as specified in its charter) COMMISSION FILE NUMBER 1-13167 Internal Revenue Service - Employer Identification No. 74-1611874 15835 Park Ten Place Drive, Houston, Texas, 77084 (281) 749-7800 ------------ Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) =============================================================================== -1- ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION On July 28, 2006, the Company announced its earnings for the Fiscal Year 2006 Third Quarter ended June 30, 2006. A copy of the press release summarizing these earnings is furnished with this Form 8-K as Exhibit 99.1 and should not be deemed to be filed under Section 18 of the Exchange Act. Additional information with respect to the Company's consolidated statements of operations for the three months and nine months ended June 30, 2006 and 2005 and an analysis of revenues and contract drilling costs for the three months and nine months ended June 30, 2006 and 2005 are attached hereto as Exhibits 99.2 and 99.3, respectively, which are being furnished; however, should not be deemed to be filed under Section 18 of the Exchange Act. ITEM 7.01 REGULATION FD DISCLOSURE Additional information with respect to the Company's Fleet Status Report at July 28, 2006 is attached hereto as Exhibit 99.4. Such information is being furnished under Regulation FD and should not be deemed to be filed under Section 18 of the Exchange Act. Statements contained in this report with respect to the future are forward-looking statements. These statements reflect management's reasonable judgment with respect to future events. Forward-looking statements involve risks and uncertainties. Actual results could differ materially from those anticipated as a result of various factors including; the Company's dependence on the oil and gas industry; the risks involved the construction of a rig; competition; operating risks; risks involved in foreign operations; risks associated with possible disruption in operations due to terrorism; risks associated with a possible disruption in operations due to a war with Iraq; and governmental regulations and environmental matters. A list of additional risk factors can be found in the Company's annual report on Form 10-K for the year ended September 30, 2005, filed with the Securities and Exchange Commission. ITEM 9.01 EXHIBITS EXHIBIT 99.1 PRESS RELEASE DATED JULY 28, 2006 EXHIBIT 99.2 CONSOLIDATED STATEMENT OF OPERATIONS FOR THE THREE MONTHS AND NINE MONTHS ENDED JUNE 30, 2006 AND 2005 EXHIBIT 99.3 ANALYSIS OF REVENUES AND CONTRACT DRILLING COSTS FOR THE THREE MONTHS AND NINE MONTHS ENDED JUNE 30, 2006 EXHIBIT 99.4 FLEET STATUS REPORT AT JULY 28, 2006 -2- SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. ATWOOD OCEANICS, INC. (Registrant) /s/ James M. Holland James M. Holland Senior Vice President DATE: July 28, 2006 -3- EXHIBIT INDEX EXHIBIT NO. DESCRIPTION ----------- ----------- 99.1 Press Release dated July 28, 2006 99.2 Consolidated Statements of Operations for the Three Months and Nine Months ended June 30, 2006 and 2005 99.3 Analysis of Revenues and Drilling Costs for the Three Months and Nine Months ended June 30, 2006 99.4 Fleet Status Report at July 28, 2006 -4- EXHIBIT 99.1 Houston, Texas 28 July 2006 FOR IMMEDIATE RELEASE ATWOOD OCEANICS, INC., Houston-based International Drilling Contractor, announced today that the Company earned net income of $27,623,000 or $.87 per diluted share, on revenues of $71,565,000 for the quarter ended June 30, 2006, compared to net income of $5,989,000 or $.19 per diluted share, on revenues of $43,589,000 for the quarter ended June 30, 2005. For the nine months ended June 30, 2006, the Company earned net income of $57,775,000 or $1.84 per diluted share, on revenues of $194,508,000 compared to net income of $19,350,000 or $.62 per diluted share, on revenues of $130,032,000 for the nine months ended June 30, 2005. Net income for the quarter and nine months ended June 30, 2006 was enhanced by approximately $1.9 million or $.06 per diluted share from income tax benefits discrete to the June 2006 quarter and by approximately $1.1 million or $0.03 per diluted share from the gains on sales of excess equipment. FOR THE THREE MONTHS ENDED JUNE 30, 2006 2005 ------------ ------------ Revenues $ 71,565,000 $ 43,589,000 Income before Income Taxes 28,763,000 5,933,000 (Provision) benefit for Income Taxes (1,140,000) 56,000 Net Income 27,623,000 5,989,000 Earnings per Common Share - Basic 0.89 0.20 Diluted 0.87 0.19 Weighted Average Shares Outstanding - Basic 31,037,000 30,484,000 Diluted 31,583,000 31,300,000 FOR THE NINE MONTHS ENDED JUNE 30, 2006 2005 -------------- ------------- Revenues $ 194,508,000 $ 130,032,000 Income before Income Taxes 64,108,000 20,176,000 Provision for Income Taxes (6,333,000) (826,000) Net Income 57,775,000 19,350,000 Earnings per Common Share - Basic 1.87 0.64 Diluted 1.84 0.62 Weighted Average Shares Outstanding - Basic 30,900,000 30,356,000 Diluted 31,412,000 31,144,000 Contact: Jim Holland (281) 749-7804 -5- EXHIBIT 99.2 ATWOOD OCEANICS, INC. AND SUBSIDIARIES UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share amounts) Three Months Ended Nine Months Ended June 30, June 30, --------------------------- --------------------------- 2006 2005 2006 2005 REVENUES: Contract drilling $ 71,565 $ 43,589 $ 194,508 $ 122,376 Business interruption proceeds - - - 7,656 -------- -------- --------- --------- 71,565 43,589 194,508 130,032 -------- -------- --------- --------- COSTS AND EXPENSES: Contract drilling 31,679 25,863 102,719 74,667 Depreciation 6,192 6,764 18,789 19,929 General and administrative 4,830 3,224 15,428 9,814 -------- -------- --------- --------- 42,701 35,851 136,936 104,410 -------- -------- --------- --------- OPERATING INCOME 28,864 7,738 57,572 25,622 -------- -------- --------- --------- OTHER INCOME (EXPENSE) Interest expense, net of capitalized interest (1,435) (1,913) (4,642) (5,658) Gain on sale of equipment 1,075 - 10,350 - Interest income 259 108 828 212 -------- -------- --------- --------- (101) (1,805) 6,536 (5,446) -------- -------- --------- --------- INCOME BEFORE INCOME TAXES 28,763 5,933 64,108 20,176 PROVISION (BENEFIT) FOR INCOME TAXES 1,140 (56) 6,333 826 -------- -------- --------- --------- NET INCOME $27,623 $5,989 $57,775 $19,350 ======== ======== ========= ========= EARNINGS PER COMMON SHARE: Basic 0.89 0.20 1.87 $0.64 Diluted 0.87 0.19 1.84 0.62 AVERAGE COMMON SHARES OUTSTANDING: Basic 31,037 30,484 30,900 30,356 Diluted 31,583 31,300 31,412 31,144
-6- EXHIBIT 99.3 ATWOOD OCEANICS, INC. AND SUBSIDIARIES ANALYSIS OF REVENUES AND DRILLING COSTS (Unaudited) FOR THE THREE MONTHS ENDED JUNE 30, 2006 CONTRACT DRILLING REVENUES COSTS -------------- ----------- (In Millions) ATWOOD HUNTER $ 20.7 $ 4.9 ATWOOD EAGLE 11.9 6.8 ATWOOD FALCON 8.4 4.1 ATWOOD BEACON 8.4 2.6 VICKSBURG 7.9 2.6 ATWOOD SOUTHERN CROSS 6.6 4.1 RICHMOND 4.7 2.5 SEAHAWK 0.1 0.3 AUSTRALIA MANAGEMENT CONTRACTS 2.9 2.1 OTHER - 1.7 ------ ----- 71.6 31.7 ====== ===== FOR THE NINE MONTHS ENDED JUNE 30, 2006 CONTRACT DRILLING REVENUES COSTS --------------- ----------- (In Millions) ATWOOD HUNTER $ 43.1 $ 12.6 ATWOOD EAGLE 33.3 19.0 ATWOOD SOUTHERN CROSS 23.3 20.2 VICKSBURG 22.3 8.6 ATWOOD FALCON 21.7 11.3 ATWOOD BEACON 21.4 7.8 RICHMOND 12.8 7.4 SEAHAWK 7.6 4.4 AUSTRALIA MANAGEMENT CONTRACTS 8.9 7.3 OTHER 0.1 4.1 ----- ----- 194.5 102.7 ===== ===== -7- EXHIBIT 99.4 ATWOOD OCEANICS, INC. AND SUBSIDIARIES FLEET STATUS REPORT AS OF JULY 28, 2006 As used herein, "we", "us", and "our" refers to Atwood Oceanics, Inc. and its subsidiaries, except where the context indicates otherwise. Statements contained in this Fleet Status Report, including information regarding our estimated rig availability, contract duration, future dayrates, future daily operating costs, future effective tax rates, customer or contract status are forward-looking statements. These statements reflect management's reasonable judgment with respect to future events. Forward-looking statements involve risks and uncertainties. Actual results could differ materially from those anticipated as a result of various factors including: our dependence on the oil and gas industry; the risks involved in upgrade, repair and construction of our rigs; competition; operating risks; risks involved in foreign operations; risks associated with possible disruptions in operations due to terrorism; risks associated with a possible disruption in operations due to the war with Iraq and governmental regulations and environmental matters. A list of additional risk factors can be found in our annual report on Form 10-K for the year ended September 30, 2005, filed with the Securities and Exchange Commission. All information in this Fleet Status Report is as of the date indicated above. We undertake no duty to update the content of this Fleet Status Report or any forward-looking statement contained herein to conform the statement to actual results or to reflect changes in our expectations. ----------------------------------------------------------------------------------------------------------------------------------- AVERAGE PER DAY RATED ESTIMATED ESTIMATED OPERATING COSTS (NOT RIG WATER CONTRACT CONTRACT INCLUDING TAX) FOR ADDITIONAL NAME DEPTH LOCATION CUSTOMER END DATE DAYRATE THE THREE MONTHS COMMENTS ENDED JUNE 30, 2006/MONTH OF JUNE 2006 ONLY ----------------------------------------------------------------------------------------------------------------------------------- SEMISUBMERSIBLES: ----------------------------------------------------------------------------------------------------------------------------------- ATWOOD 5,000' Australia WOODSIDE FIRM WORK - 1 well at $99,000 $75,000/$73,000 The $99,000 rate well is EAGLE ENERGY LTD (2 wells) 1 well at $179,000 expected to be completed at ("WOODSIDE") August 2006 the end of July 2006. ----------------------------------------------------------------------------------------------------------------------------------- Australia BHP BILLITON FIRM WORK - 8 wells at $158,000 N/A Wells are subject to a PETROLEUM PTY (10 wells) 1 well at $168,000 change in sequence and ("BHPB") August 2007 1 well at $150,000 dayrate is subject to some change due to currency exchange rate variance. ----------------------------------------------------------------------------------------------------------------------------------- Australia BHPB OPTIONS - $168,000 N/A Dayrate is subject to some (3 wells) change due to currency November 2007 (if all exchange rate variance. three option wells are drilled) ----------------------------------------------------------------------------------------------------------------------------------- -1- AVERAGE PER DAY RATED ESTIMATED ESTIMATED OPERATING COSTS (NOT RIG WATER CONTRACT CONTRACT INCLUDING TAX) FOR ADDITIONAL NAME DEPTH LOCATION CUSTOMER END DATE DAYRATE THE THREE MONTHS COMMENTS ENDED JUNE 30, 2006/MONTH OF JUNE 2006 ONLY ----------------------------------------------------------------------------------------------------------------------------------- Australia ENI Spa AGIP FIRM WORK - $360,000 N/A We expect the well to take EXPLORATION & (1 well) 40 to 45 days to complete. PRODUCTION December 2007 DIVISION (assuming that all of ("ENI") the above option wells are drilled) ----------------------------------------------------------------------------------------------------------------------------------- Australia WOODSIDE FIRM WORK - $420,000 N/A Woodside has an option (1 year) (which expires October December 2008 2006) to extend the (assuming that all of drilling program from one the above option year to two or three wells are drilled and years. If either the two that Woodside does or three year option period not extend their is selected, the dayrate program to two for the entire selected or three years) period will be $405,000. If a one year period is selected, the dayrate will be $420,000. ----------------------------------------------------------------------------------------------------------------------------------- Australia N/A N/A N/A N/A The rig could be off dayrates for ten to fourteen days during the first quarter of fiscal year 2008 for required regulatory inspections and maintenance. ----------------------------------------------------------------------------------------------------------------------------------- ATWOOD 5,000' Mauritania/ WOODSIDE FIRM WORK - $240,000 (Mauritania) $54,000/$63,000 Operating costs are HUNTER Libya (2 years) $245,000 (Libya) expected to be $50,000 to May 2008 $55,000 per day while working in Mauritania/Libya; however, costs could be higher during any relocation period. ----------------------------------------------------------------------------------------------------------------------------------- Mauritania N/A N/A N/A N/A The rig is expected to be off dayrate for ten to fourteen days during the first quarter of fiscal year 2007 for required regulatory inspections and maintenance. ----------------------------------------------------------------------------------------------------------------------------------- -2- AVERAGE PER DAY RATED ESTIMATED ESTIMATED OPERATING COSTS (NOT RIG WATER CONTRACT CONTRACT INCLUDING TAX) FOR ADDITIONAL NAME DEPTH LOCATION CUSTOMER END DATE DAYRATE THE THREE MONTHS COMMENTS ENDED JUNE 30, 2006/MONTH OF JUNE 2006 ONLY ----------------------------------------------------------------------------------------------------------------------------------- TBD WOODSIDE OPTIONS - TBD N/A Two (2) six-month options. ----------------------------------------------------------------------------------------------------------------------------------- ATWOOD 3,700' Malaysia SARAWAK FIRM WORK - $93,200 $45,000/$38,000 FALCON (to be SHELL August 2006 upgraded to BERHAD 5,000' at ("SHELL") the end of fiscal year 2006) ----------------------------------------------------------------------------------------------------------------------------------- Shipyard SHELL FIRM WORK - $90,000 N/A The rig is scheduled to November 2006 (for up to undergo an estimated $32 85 days) million upgrade with Shell paying $24 million of the costs. ----------------------------------------------------------------------------------------------------------------------------------- Malaysia SHELL FIRM WORK - $93,200 N/A The rig should drill two January 2007 wells at $93,200 following the upgrade. (The $24 million Shell reimbursement will be amortized as revenues over the remaining firm contract commitment following the upgrade (33 months) which will increase dayrate revenues by approximately $24,000.) ----------------------------------------------------------------------------------------------------------------------------------- Malaysia SHELL FIRM WORK - $113,000 N/A July 2007 ----------------------------------------------------------------------------------------------------------------------------------- Malaysia SHELL FIRM WORK - $160,000/ N/A Most of the work during (2 years) $200,000 (dayrate this period is expected to July 2009 depends on water depth be at the $160,000 dayrate of each well) level. ----------------------------------------------------------------------------------------------------------------------------------- Malaysia SHELL OPTION - TBD N/A (1 year) ----------------------------------------------------------------------------------------------------------------------------------- -3- AVERAGE PER DAY RATED ESTIMATED ESTIMATED OPERATING COSTS (NOT RIG WATER CONTRACT CONTRACT INCLUDING TAX) FOR ADDITIONAL NAME DEPTH LOCATION CUSTOMER END DATE DAYRATE THE THREE MONTHS COMMENTS ENDED JUNE 30, 2006/MONTH OF JUNE 2006 ONLY ----------------------------------------------------------------------------------------------------------------------------------- ATWOOD 2,000' Italy ENI FIRM WORK - $70,000 $45,000/$47,000 SOUTHERN September/ CROSS October 2006 ----------------------------------------------------------------------------------------------------------------------------------- Mobilization MELROSE FIRM WORK - $100,000 N/A Operating costs are to Black RSOURCES November 2006 expected to be $45,000 to Sea - ("MELROSE") AND $50,000 per day during Bulgaria/ TOREADOR mobilization and while Turkey TURKEY LIMITED working in the Black Sea. ("TOREADOR") ----------------------------------------------------------------------------------------------------------------------------------- Bulgaria MELROSE FIRM WORK - $125,000 N/A There is a possibility that (3 wells) MELROSE may let TOREADOR February 2007 drill all or a part of their drilling program before the MELROSE program. If the rig drills for TOREADOR ahead of MELROSE and if TOREADOR has a well to be drilled after completion of the MELROSE work, the dayrate for that well will be $135,000. ----------------------------------------------------------------------------------------------------------------------------------- Bulgaria MELROSE OPTIONS - $125,000 N/A See above (2 wells) April 2007 (if both option wells are drilled) ----------------------------------------------------------------------------------------------------------------------------------- Turkey TOREADOR FIRM WORK - $125,000 N/A See above (3 wells) July 2007 (assuming Melrose option wells are drilled) ----------------------------------------------------------------------------------------------------------------------------------- Turkey TURKIYE FIRM WORK - $290,000 N/A PETROLLERI (3 wells) A.O. October 2007 ("TPAO") (assuming above option wells are drilled) ----------------------------------------------------------------------------------------------------------------------------------- -4- AVERAGE PER DAY RATED ESTIMATED ESTIMATED OPERATING COSTS (NOT RIG WATER CONTRACT CONTRACT INCLUDING TAX) FOR ADDITIONAL NAME DEPTH LOCATION CUSTOMER END DATE DAYRATE THE THREE MONTHS COMMENTS ENDED JUNE 30, 2006/MONTH OF JUNE 2006 ONLY ----------------------------------------------------------------------------------------------------------------------------------- Turkey TPAO OPTIONS - $320,000 N/A If TPAO exercises their (3 wells) options, the well sequence January 2008 for TPAO option wells and (assuming MELROSE VANCO wells could change. option wells drilled and TPAO exercises options to drill all three option wells) ----------------------------------------------------------------------------------------------------------------------------------- Ukraine VANCO FIRM WORK - $305,000 N/A See above INTERN- (1 well) NATIONAL March 2008 (assuming LTD. MELROSE and TPAO ("VANCO") options are exercised) ----------------------------------------------------------------------------------------------------------------------------------- Ukraine VANCO OPTIONS - $325,000 N/A See above (1 well) April 2008 (assuming MELROSE, TPAO and VANCO options are all exercised) ----------------------------------------------------------------------------------------------------------------------------------- CANTILEVER JACK-UPS: ----------------------------------------------------------------------------------------------------------------------------------- ATWOOD 400' Vietnam HOANG FIRM WORK - $110,000 $29,000/$27,000 BEACON LONG September 2006 AND HOAN VU JOINT OPERATING COMPANIES ("HOANG LONG") ----------------------------------------------------------------------------------------------------------------------------------- Mobilization GUJARAT STATE FIRM WORK - $110,000 N/A to Singapore PETROLEUM October 2006 CORPORATION (Mobilization is LTD. ("GSPC") expected to take one week.) ----------------------------------------------------------------------------------------------------------------------------------- -5- AVERAGE PER DAY RATED ESTIMATED ESTIMATED OPERATING COSTS (NOT RIG WATER CONTRACT CONTRACT INCLUDING TAX) FOR ADDITIONAL NAME DEPTH LOCATION CUSTOMER END DATE DAYRATE THE THREE MONTHS COMMENTS ENDED JUNE 30, 2006/MONTH OF JUNE 2006 ONLY ----------------------------------------------------------------------------------------------------------------------------------- Singapore N/A October 2006 $70,000 N/A Loss of hire insurance (The rig is expected coverage to be in Singapore about two weeks to reattach its last leg section.) ----------------------------------------------------------------------------------------------------------------------------------- Mobilization GSPC FIRM WORK - $110,000 N/A to India November 2006 (Mobilization is expected to take 17 days.) ----------------------------------------------------------------------------------------------------------------------------------- India GSPC FIRM WORK - $113,000 N/A (13 months) December 2007 ----------------------------------------------------------------------------------------------------------------------------------- India GSPC FIRM WORK - $133,500 N/A (12 months) December 2008 ----------------------------------------------------------------------------------------------------------------------------------- India GSPC OPTIONS - (1 year) TBD N/A ----------------------------------------------------------------------------------------------------------------------------------- VICKSBURG 300' Malaysia PETROFAC FIRM WORK - $82,000 $29,000/$27,000 (MALAYSIA - (4 wells) PM304), September/October 2006 LTD. ("PETROFAC") ----------------------------------------------------------------------------------------------------------------------------------- Malaysia PETROFAC OPTIONS - $87,000 N/A (3 wells) October/November 2006 (assuming all three option wells are drilled) ----------------------------------------------------------------------------------------------------------------------------------- Mobilization CHEVRON FIRM WORK - $89,775 (95% of N/A to Thailand OVERSEAS November 2006 operating rate) PETROLEUM (Mobilization is ("CHEVRON") expected to take three days.) ----------------------------------------------------------------------------------------------------------------------------------- Thailand CHEVRON FIRM WORK - $94,500 N/A (8 months) June 2007 ----------------------------------------------------------------------------------------------------------------------------------- -6- AVERAGE PER DAY RATED ESTIMATED ESTIMATED OPERATING COSTS (NOT RIG WATER CONTRACT CONTRACT INCLUDING TAX) FOR ADDITIONAL NAME DEPTH LOCATION CUSTOMER END DATE DAYRATE THE THREE MONTHS COMMENTS ENDED JUNE 30, 2006/MONTH OF JUNE 2006 ONLY ----------------------------------------------------------------------------------------------------------------------------------- Thailand CHEVRON FIRM WORK - $154,000 N/A (2 years) June 2009 ----------------------------------------------------------------------------------------------------------------------------------- Thailand N/A N/A N/A N/A The rig could be off dayrate for ten to fourteen days during the first quarter of fiscal year 2008 for required regulatory inspections and maintenance. ----------------------------------------------------------------------------------------------------------------------------------- SEMISUBMERSIBLE TENDER ASSIST UNIT: ----------------------------------------------------------------------------------------------------------------------------------- SEAHAWK 1,800' Mobilization AMERADA HESS FIRM WORK - $5.5 Million in fees $3,000/ Following the rig's to EQUATORIAL August 2006 to be received during $3,000 relocation to Equatorial Equatorial GUINEA, (Mobilization is the mobilization period Guinea, operating costs are Guinea INC. ("HESS") expected to take expected to be $45,000 to approximately one $50,000 per day; however, month to complete.) costs could be higher during the initial start-up period. Fees received during the mobilization period are expected to cover mobilization costs. (All fees received during the mobilization period along with all mobilization costs will be amortized over the firm two year period of the contract; which is expected to increase per day revenues and costs by approximately $7,500.) ----------------------------------------------------------------------------------------------------------------------------------- Equatorial HESS FIRM WORK - $51,322 (75% of N/A Guinea September 2006 operating rate) (Rig-up is expected to take three to four weeks.) ----------------------------------------------------------------------------------------------------------------------------------- Equatorial HESS FIRM WORK - $68,430 N/A Guinea (2 years) September 2008 ----------------------------------------------------------------------------------------------------------------------------------- -7- AVERAGE PER DAY RATED ESTIMATED ESTIMATED OPERATING COSTS (NOT RIG WATER CONTRACT CONTRACT INCLUDING TAX) FOR ADDITIONAL NAME DEPTH LOCATION CUSTOMER END DATE DAYRATE THE THREE MONTHS COMMENTS ENDED JUNE 30, 2006/MONTH OF JUNE 2006 ONLY ----------------------------------------------------------------------------------------------------------------------------------- Equatorial HESS OPTIONS - $68,430 N/A Guinea (2 years) September 2010 (if all four six-month options are exercised) ----------------------------------------------------------------------------------------------------------------------------------- SUBMERSIBLE: ----------------------------------------------------------------------------------------------------------------------------------- RICHMOND 70' US Gulf of HELIS OIL AND FIRM WORK - $80,000 $27,000/$27,000 Mexico GAS ("HELIS") (7 wells) July 2007 ----------------------------------------------------------------------------------------------------------------------------------- US Gulf of HELIS OPTIONS - TBD N/A Mexico October/November 2007 (one option for four additional wells) ----------------------------------------------------------------------------------------------------------------------------------- US Gulf of N/A N/A N/A N/A The rig could be off Mexico dayrate for ten to fourteen days during the first quarter of fiscal year 2008 for required regulatory inspections and maintenance. ----------------------------------------------------------------------------------------------------------------------------------- MANAGEMENT CONTRACT ----------------------------------------------------------------------------------------------------------------------------------- NORTH N/A Australia WOODSIDE FIRM WORK - Daily margin of $5,000 The management contract RANKIN 'A' September 2006 to $7,000 could terminate upon completion of the current drilling program for the NORTH RANKIN 'A' platform. This work is expected to be completed in September 2006. ----------------------------------------------------------------------------------------------------------------------------------- NOTE - EXPECTED TAX RATE An effective tax rate of 10% to 12% is expected for fiscal year 2006 and 20% to 25% for fiscal year 2007. Virtually all of the Company's tax provision for fiscal year 2006 and expected tax provision for fiscal year 2007 relates to taxes in foreign jurisdictions. Working in foreign jurisdictions with nontaxable or deemed profit tax systems contribute to the effective tax rate being significantly less than the United States statutory rate.
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