Good morning. My name is Darlene and I will be your conference operator today. At this time, I would like to welcome everyone to the fiscal 2008 second quarter earnings conference call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions]. I will now turn the call over to Mr. Dean Taylor, Chairman, President and CEO of Tidewater Incorporated. Mr. Taylor, you may begin your conference. Dean E. Taylor – Chairman, President and Chief Executive Officer: Thank you, Darlene. Good morning, everyone, and welcome to Tidewater's fiscal 2008 second quarter earnings conference call. The period ending, September the 30th, 2007. I'm Dean Taylor, Tidewater's Chairman, President and CEO and I will be hosting the call this morning. With me today are Keith Lousteau, our Executive Vice President and Chief Financial Officer, Jeff Platt, Principal Accounting Officer and Chief Investing Relations Officer, Steve Dick, Executive Vice President, in charge of Strategic Relationships, Shipyard Operations and Vessel Acquisitions and Dispositions. Bruce Lundstrom, our new Senior Vice President, General Counsel and Secretary, and Nancy Morovich, our Senior Vice President for Strategic Planning and Analysis. We will follow our usual format this morning. I will start with some comments about our just released earnings results. Following my remarks I will turn the call over to Keith for detailed review of the numbers as well as our new build and vessel replacement program. I will then return with the discussion of our view of our markets and a review of our strategy. We will then open the call for questions. At this time, I will ask Keith to read our Safe Harbor statement and then we can get started. J. Keith Lousteau – Chief Financial Officer, Executive Vice President and…

[Operator Instructions]. We will pause for just a moment to compile the Q&A roster. Your first question comes from the line of Ken Sill. Dean E. Taylor – Chairman, President and Chief Executive Officer: Hi Ken. Ken Sill – Credit Suisse: Good morning guys. Dean E. Taylor – Chairman, President and Chief Executive Officer: How are you doing? Ken Sill – Credit Suisse: Doing well, enjoying the break in the weather finally. I don’t think anybody in Houston wants to be at work today. Dean E. Taylor – Chairman, President and Chief Executive Officer: Let’s get off the phone! Ken Sill – Credit Suisse: Let’s get to it. So I was very interested to hear your comment of the increasing number of term and actually extended term contracts internationally. I guess there is good and bad with that. But the good news is it gives you more visibility. The bad is that actually probably going to start slowing down the rate of increase internationally on the AHTS’s? As you get more on term I guess or where we stand on that process is really the other question. Dean E. Taylor – Chairman, President and Chief Executive Officer: Well we still have we think a good mix Ken with the 50-50 that will mean 50% of our vessels long-term, 50% on spot or shorter term. So we think there is still plenty of room for day rate increases as we termed some of these vessels up and you have seen I think you, yourself have been somewhat surprised in our ability to continue to raise rates through time, and we, I am not at the point where I feel like day rates are close to topping off. Ken Sill – Credit Suisse: Okay and then you said there was the terms…

Your next question comes from the line of Pierre Conner. Dean E. Taylor – Chairman, President and Chief Executive Officer: Hi Pierre. Pierre Conner – Capital One Southcoast Inc. Gentlemen. Dean first my sympathies to you and the Tidewater family in the losses recently. Dean E. Taylor – Chairman, President and Chief Executive Officer: Thank you very much Pierre. Pierre Conner – Capital One Southcoast: First on the market team, the 220 some international Toll Tow supply vessels rate increases are very impressive so I don’t want to get into that a little bit more. Can you give us some metrics on the number of vessels in that segment that did roll up? What percent of that class reprised in the quarter that allowed you get that kind of an increase, roughly maybe if not exact? Dean E. Taylor – Chairman, President and Chief Executive Officer: You got everybody in here shaking their head. I don’t think we track it by that metric, we-- Pierre Conner – Capital One Southcoast: Between somewhat on Ken’s question being I guess you got two trends going, you got some markets and I am going to ask you about these markets in a second, where you got some nice increases in the leading spot rates, it occurs you are getting more term. I am trying to carry this into subsequent quarters obviously. If the entire fleet was able to get new pricing during the quarter then I have got to see some continued strength. This is some percentage of the fleet that reprised; the remaining fleet has that opportunity as well? Dean E. Taylor – Chairman, President and Chief Executive Officer: Jeff is off in Angola on an assignment but Keith you want to take a standby, I think Pierre you have to look…

The next question comes from the line of Michael Ferra [ph]. Dean E. Taylor – Chairman, President and Chief Executive Officer: Good morning.

Good morning. Dean E. Taylor – Chairman, President and Chief Executive Officer: How are you?

Not too bad. How are you? I am going to touch just quickly on the term contract issue on the international side. We have seen term shrink pretty dramatically for international jack ups over the last few months and it very much trended toward spot assets again. And I just want to ask, do you not expect to see any of that effects spill over into the OSC side? Dean E. Taylor – Chairman, President and Chief Executive Officer: I am not paying as much attention to the jack up companies as probably as you are but we are seeing it, we are not seeing a reduction in terms. And to the contrary we track every opportunity almost daily and we are not seeing movements towards spot orders internationally for our equipment, certainly in the domestic market that’s the trend. But we are not seeing that internationally and I don’t know, I think the big, there is a couple of relatively big questions and one of course is when all the new rigs come into the market will all of the old rigs keep working? And I think that’s the bigger question, probably then whether we tend to have more spot orders and term orders. The bigger question I think is do all the old rigs work? If they do then that’s one scenario and if they don’t that’s certainly another one.

Okay. And then also I wanted to ask about incremental opportunities to move more OSVs out of the Gulf of Mexico shelf. How many more do you think you could reasonably take out? How many more would you want to take out? Dean E. Taylor – Chairman, President and Chief Executive Officer: We don’t have a goal per se. Again we, our communications internally are pretty good and what we do and of course we are in a AVA program and we are all graded by, our bonuses are all paid based on AVA creation. So that tends to eliminate parochialism in terms of hoarding of assets. The guys are very generous, one with the other in terms of moving equipment to better opportunities. So the poor fellow who is managing our Gulf of Mexico business in the last year, he has probably lost 20 pieces of equipment and he’s gladly given them up because he knows that ultimately it’s better for the company. And so, do we have a goal? The goal is to increase AVA an profitability of our company and as an opportunity it develops internationally we will look at it and see whether it makes more sense to keep a vessel in the Gulf or not. I am, so I don’t think we have a goal, our goal is profitability and EVA.

Okay and all the opportunities though as prevalent as they were say, 6 months ago? Do you still feel you have number of opportunities to bid equipment out there? Dean E. Taylor – Chairman, President and Chief Executive Officer: We do, we sure do.

Okay that’s good. And then also wanted to jump back to the Middle East to real quickly where you talked about kind of some discounts, kind of some pricing you get out there, we are probably going to see more recount growth there, than any other region over the next 18 months or so. So do you expect pricing out there to sought of eventually meet up to other international standards or at least get closer over the next year or so? Dean E. Taylor – Chairman, President and Chief Executive Officer: Absolutely. Should get closer and also I think that because of safety concerns the Middle East will eventually become more like other markets simply because they are not going to tolerate or really maintain the equipment and fully operate the equipment as they have in the past for long time. You know for a long time I mean Saudi Aramco was not active off shore at all. And one of the things that I think lies there the claim that they can increase production almost at the turn of a valve. They’ve charted all of these jack ups for off shore work and seems to me that’s’ an indication that they can’t ramp up production as much as they had indicated that they could. But they are going to be much more demanding I think in terms of what equipments they will accept into their market place and we see more and more international operators there in the Middle East as well and they are pretty demanding as to what kind of equipment they are allowed to serve them. So, on the whole I think that the pricing will be approximate better international pricing as we move forward.

Okay that’s very helpful. And one last one if I can, rates from the Gulf of Mexico Deepwater, I know you guys don’t have many vessels out there but I saw they were kind of flattish this quarter and I think if I heard correctly from Keith that they are sort of down about 1200 or so now versus the average. I just want to get a sensible, what was going on there? J. Keith Lousteau – Chief Financial Officer, Executive Vice President and Treasurer: The nature in the mix of vessels, at one point we had an anchor handler that was in there, the Coral Thorn, which is now operating out of Trinidad so you move out a vessel that on a spot they could have earned $50,000 to $75,000. And the addition of the new vessel that came out went on a nice turn charter job that was I think few dollars less than the average 2 so perhaps that did it. But no even though I did give you a number that was about $1200 less than the average for last quarter, that's probably the mixture of fog work versus to term work that we have there. I don't think there's any meaningful movement in the day rates in the Deepwater Gulf of Mexico. Just a quirk, of some calculations I’m afraid. Dean E. Taylor – Chairman, President and Chief Executive Officer: And also a result of some vessels being on fire. And when they are on fire day rate averages down.

Okay but you said the leading edge is sort of flattish in the Deepwater Gulf of Mexico? Joseph M. Bennett – Senior Vice President, Principal Accounting Officer and Chief Investor Relations Officer: For us it is.

Great. Thank you very much, guys. Dean E. Taylor – Chairman, President and Chief Executive Officer: I'm not sure that that, I'm not sure that your company that Deepwater rates in the gulf are flattish. I'm not sure that's right. I think for the time being, that may be right but I'm not sure that's necessarily what the future market holds.

Okay. Dean E. Taylor – Chairman, President and Chief Executive Officer: I hope I'm sufficiently confusing.

All right. Dean E. Taylor – Chairman, President and Chief Executive Officer: I don't think, I don't think rates necessarily have left the Gulf of Mexico, if that makes any more sense.

It does. Fair enough. Thank you, sir. Dean E. Taylor – Chairman, President and Chief Executive Officer: Thanks.

Your next question comes from the line of Daniel Burke. Dean E. Taylor – Chairman, President and Chief Executive Officer: Hi, Daniel. Daniel Burke – Johnson Rice & Company: Good morning all. Thank you for the little bit of additional clarity in understanding how the 220 international Tow supply boats, in terms of categorization. I was curious, if you look at the 180 older vessels and you look at the 40 newer vessels within that class, is the trajectory of rate improvement in each vessel set similar or are the older vessels seeing more static rate and it's really more, you can back into this, but more a function of mix shift that’s driving that rate through right now? Dean E. Taylor – Chairman, President and Chief Executive Officer: You know, Daniel, in our presentations, we have a slide that shows the rate of progression of growth for the old vessels and the new vessels broken out. and if you look, certainly the rate of progression of rates for the older vessels is not as steep as that of the newer vessels. So I think that’s probably about as good a way an answer to your question as I can give you. It’s just, the slope of that line certainly made for the older vessels, is not as deep for the newer vessels. Daniel Burke – Johnson Rice & Company: Okay. And then one for Keith. Keith I think I asked I asked this question last quarter, but checking the OpEx guidance at 147 or 149; if you were to look ahead another quarter, its your final quarter the fiscal year, maybe the dry dock expense line wont be as impressive at that point. I guess what I’m trying to ask you is, you think that 147 or 149 is…

And there are no questions at this time. Dean E. Taylor – Chairman, President and Chief Executive Officer: Okay while I thank everyone for your participation in our today and wish everyone the best. Thank you for your interest in our company. Thanks.

This concludes today’s conference call. You may now disconnect. Dean E. Taylor – Chairman, President and Chief Executive Officer: Thank you Darlene.

You’re welcome.