Greetings, and welcome to the Ensco plc Fourth Quarter and Year End 2010 Earnings Conference Call. [Operator Instructions] It is now my pleasure to introduce your host, Mr. Sean O'Neill, Vice President of Investor Relations for Ensco. Thank you, Mr. O'Neill, you may begin.

Thank you, operator, and welcome, everyone, to Ensco's Fourth Quarter 2010 Conference Call. With me today are Dan Rabun, CEO; Bill Chadwick, our COO; James Swent, our Chief Financial Officer; as well as other members of our executive management team. We issued our earnings release, which is available on our website at enscoplc.com. Later today, we plan to file our SEC Form 10-K. As usual, we will keep our call to one hour. Any comments we make about expectations are forward-looking statements and are subject to risks and uncertainties. Many factors could cause actual results to differ materially. Please refer to our earnings release and SEC filings on our website that define forward-looking statements and list of risk factors and other events that could impact future results and disclose important additional information regarding the transaction that will be filed with the SEC. Also, please note that the company undertakes no duty to update forward-looking statements. As a reminder, our most recent fleet status report was issued on February 15. Now let me turn the call over to Dan Rabun, Chairman and CEO.

Thanks, Sean, and good morning, everyone. Before Jay takes us to the financial results, I will discuss 2010 highlights, our recent announcement to acquire Pride and the state of our markets. 2010 was a challenging year for our industry, and I'm extremely proud of our employees for their performance in facing these challenges. We started the year transitioning our global headquarters from Dallas to London, and a year later, I can tell you the relocation went very smoothly. The advantages of moving to London are even greater than we expected in terms of customer contact, management oversight and the benefits of the more competitive tax position, including greater flexibility in terms of completing M&A transactions. In April of last year, we announced a major increase to our regular quarterly cash dividend, given our strong financial position and favorable outlook for offshore drilling. The dividend increase was extremely well received by investors, and our board intends to maintain the $0.35 per share quarterly dividend on an ongoing basis following the close of the Pride acquisition. Our industry then faced the Macondo incident, and we have been confronting the fallout ever since. For Ensco, I believe the challenges for Macondo have highlighted the strength of our organization. We were the first to receive re-certification of our deepwater rigs by regulators. The strength of our deepwater drilling contracts became evident. Our jackups were the first to drill a new gas well and a new oil well after the moratorium was lifted. And we gained new deepwater customers for our rigs to sublets, including work for Telo and French Guiana. Our rig personnel, sure base marketing teams, other employees as well as our legal department and many others pulled together to make the best of a very difficult situation, and we are proud of…

Thanks, Dan. My comments today will cover details of our fourth quarter results, our outlook for the first quarter and full year 2011, a review of our financial position and a brief discussion regarding the Pride acquisition. Let's start with some items that influenced fourth quarter results. As discussed on our last conference call, the exact amount and timing of revenue recognition for ENSCO 7500's lump sum demobilization fee from its prior contract was unclear. However, as we reported in our February 2 press release, the recent contracting of ENSCO 7500 with Petrobras allowed us to recognize the $26 million demobilization fee as revenue during the fourth quarter versus an earlier projection that it would be recognized in the first quarter of 2011. For ENSCO 8502, you will recall that we were in a dispute with our customer Nexen regarding exactly when the contract commenced. In our third quarter results, we deferred revenue for 8502 for the period August 13 through September 30 that has now been recognized in fourth quarter results. Ensco 60, which was placed into discontinued operations in third quarter 2010, was sold in the fourth quarter for approximately $26 million, and we recognized a pretax gain of $6 million. The rig will not be used by the buyer as a drilling unit, so it will be taken out of the overall rig supply. Now, I will discuss our fourth quarter results versus prior year. Earnings from continuing operations were $0.90 per share, down from $1.40 a year ago. We had a gain of $0.03 per share from discontinued operations in the quarter, primarily related to the sale of Ensco 60, compared to $0.06 per share a year ago. Fourth quarter earnings per diluted share were $0.93 compared to $1.46 last year. Total revenue for the quarter…

Thanks, Jay. As a reminder, Ensco and Pride will be operating as two independent companies until the closing of the acquisition, so we will not be taking any questions regarding the acquisition. However, in the next week or two, we will be filing a registration statement, including a joint proxy statement perspectives with the SEC. Now, operator, please open it up for questions.

[Operator Instructions] Our first question is coming from Collin Gerry of Raymond James.

So, Dan, you mentioned a significant uptick in Deepwater demand in your statements. I wonder if you could qualify that and maybe give us a little bit more flavor geographically where and maybe what that means for the 8500 Series that we're seeing delivered in 2012?

Sure, and let me refer that question over to Carey Lowe who runs our Deepwater business.

Collin, over the last quarter and probably starting the quarter before that, we have seen an uptick in the number of inquiries and tender requests. And when talking to our customers, we're hearing about programs that will come out in the near future as well. That's the basis for our statement that we would see an improving demand situation.

And is that -- if you, kind of, look at the semi versus drill ship debate, is it leaning towards one side or the other?

No, it's not. You see request for both. You see some that are just agnostic. There's no specific request.

Switching gears to Jackup market. I guess first question is, any appetite to exercise those options or maybe pursue a different design and build more jackups over the next few months?

This is Bill Chadwick. We are very enthusiastic about the capabilities of the two units we're contracted for now. So we have a lot of interest in those options. We have a lot of interest in the capabilities of this new configuration. Certainly, if we continue to talk to customers and determine what their specific requirements are, we will consider all options, including some different designs. But right now, we're very enthusiastic about these enhanced Super A class that we're building and that we have options on some additional units.

And just a point of clarification, are those Norway capable jackups?

These units are not being built to Norwegian specs. They're being built to specifications to work in all of the other jurisdictions in Europe and the North Sea, including Denmark. But these are not being outfitted to Norwegian specifications at this time.

Our next question is coming from Robert MacKenzie of FBR Capital Markets. Robert MacKenzie - FBR Capital Markets & Co.: Question for you on how you think about newbuilds going forward here. Obviously, in the wake of Pride, I recognize you're not going to talk about the pending merger there. But how do you think about A, what type of rig you might be interested in building now? And B, the possibility or likelihood of whether you might do some of that either before the merger closes or wait till it actually closes? And how you think about spec building either for jackups or deepwater rig?

Well, Rob, I guess there's been a certain amount of conversation already this morning about capital discipline and newbuilds. And I guess I would say the ultimate discipline is being a consolidator as opposed to a new builder. I think the way we view it is, we would much rather be taking existing supply out of the market. If you look at what we've done over the last year, we took a run at the Scorpion assets, which were existing assets. I think we showed some discipline there and that we thought the price was getting a little too frothy. We bought the Ensco 109 this year, and now we're talking about the Pride transaction. So I think our view at the moment is, we're pretty satisfied with the deepwater fleet that we will have when we put the two companies together. And as Bill kind of indicated, we still see some opportunity to enhance the jackup fleet. And I think our view there has always been, yes, those are long-life assets. We believe in that market, and we don't really feel like we need to have a contract to build against necessarily. We're comfortable to build those on spec. I've always said, if you need a contract to build the jackup, you probably shouldn't be building the jackup. Robert MacKenzie - FBR Capital Markets & Co.: And what are you seeing in terms of what type of jackup might you be interested in building going forward? There's been a lot of debate as to what the jackups of the future is. What's your view on that topic?

Well, let me have Bill touch on that.

I spoke to that a little bit just a moment ago. We think that the Super A class with the enhancements that we have integrated into the two rigs that we just announced is a very capable and a very cost-effective unit or a very high percentage of the jackup operating areas in the world, so we're very enthusiastic about that. That having been said, I think we also see that operators are looking at pushing jackup operations into increasingly challenging environments, so we're talking to a more continuous basis. And I think we've got a pretty talented engineering group here that's capable of evaluating the different designs to make sure that we are going to continue to offer what it is that operators are looking for going forward. And there are no restrictions on that. We'll evaluate anything that we think will do the job on a cost-effective basis.

Our next question is coming from Arun Jayaram of Credit Suisse. Arun Jayaram - Crédit Suisse AG: Jay, can you reiterate your earnings guidance that you provided? I thought I heard you say $5 in earnings per share, but I'm just trying to get a sense of what year you're mentioning.

Perhaps I wasn't clear enough, Arun. We're talking about 2012. Arun Jayaram - Crédit Suisse AG: Dan, you seem to be more upbeat about the deepwater market, or ultra-deepwater market. To date, we've seen more of the contract announcements being shorter term and made sure perhaps one year, et cetera. Are you seeing anymore interest in longer-term opportunities?

Yes. There are several multi-year opportunities there in the marketplace right now for tender, and there are quite few shorter term as well. So I think there's a good mixture. But I think you're more likely to see terms in the two-year range. That seems to be kind of about where a lot of these programs are. Arun Jayaram - Crédit Suisse AG: And, Dan, obviously, you've seen a lot of new build activity in the deepwater floater market and the jackup market. Are you getting concerned about the number of units being ordered with the shipyards?

Arun, the answer is no. I mean, if you look at what we view, our forecast of deepwater demand going forward, we think there will be plenty of opportunities for those rigs to work. Arun Jayaram - Crédit Suisse AG: And last question, Jay, I don't believe the preliminary proxy for the merger is out yet. Can you give us a sense when that could be issued?

It's probably going to be in the next week or so, Arun.

Our next question is coming from Ian Matterson of Simmons.

Jay, with your Deepwater revenue guidance, can you say if the high-end and/or the low-end include any participation of the 8504?

Yes, it does, but only a very slight amount. Obviously, that rig is not delivered until late in the year.

Does the low-end include the 8504?

The range, obviously, includes all the rigs in. We don't want to do it on a rig by rig basis. But we wanted to give you the sense of our outlook at this point what the range could be. The range is mostly driven by the outlook for the U.S. Gulf of Mexico. If permits are issued sooner, you're at the higher end of the range. If It takes a little longer, you're at the lower end of the range.

And then, I also want to follow up on the North Sea Jackup market. I got the sense that we might -- from your utilization commentary -- that we might actually see some pricing power there with their rigs in the second half or is that premature to assume?

Yes, I think just take a look at our rig contracts status report. I think we're pretty well contracted, starting in the middle of the year. And based on what we're seeing, I would expect you could probably see some pricing momentum in the second half of the year.

Our next question is coming from Max Barrett of Tudor, Pickering, Holt. Max Barrett - Tudor, Pickering, Holt & Co. Securities, Inc.: You talked about the $50 million of Pride cost synergies just at the corporate level. Can you quantify the possible synergies if you include the operational level as well?

Yes, as we said, it's a little premature for us to be talking very much about Pride and any more detail than what we've said in our prepared comments. Max Barrett - Tudor, Pickering, Holt & Co. Securities, Inc.: And then, just switching to the two idle jackups you talked about in Tunisia. I think you said there are couple opportunities in the Mediterranean for 2011. Can you give us a sense as to when these rigs might get back to work?

This is Bill, Max. That's a little hard to qualify now. The civil unrest in that region has changed the schedule which would have materialized otherwise. So some of those opportunities are in Tunisia, some of them are not, some are elsewhere in the region, and they're also impacted by the political situation now. So there are also some outside the region. That's a little hard to quantify. I think all we can say is, whether it is into the Mediterranean or whether we have to relocate those rigs in other jurisdictions, we'll have them back to work by, I would say, Q3 anyway.

Our next question is coming from Scott Gruber of Bernstein.

You mentioned the firming of leading-edge jackup rigs in your commentary, does this extend beyond the ultra high spec jackups to the premium in more conventional classes?

Yes.

Can you give us some color on which regions maybe leading that push?

Again, if you just take our fleet status reports and lay them side by side, I think, what you'll find is in every region, the only region that continues to be fairly soft is the Middle East, which has a lot of excess supply right at the moment.

And then, you outlined your jackup utilization assumption for 2012 in the low 80%. But does your $5 EPS guidance also incorporate some jackup rate improvement?

There's minor improvement, but it's not dramatic.

Our next question is coming from Phil Dodge of Tuohy Brothers.

Question on Mexico, how do you see that market medium term? Any visibility even sustainable growth, whether it will be an absorbed of rigs during the next few years?

I think what we're seeing is a lot of tenders being issued by PEMEX recently. Several of those tenders are against incumbent rigs, but we're beginning to see tenders now, which are clearly calling for incremental rigs. I think that the key to what happens in Mexico or the rig specifications and the rate caps that PEMEX imposes on those tenders for are quite some time now. PEMEX has had some pretty stringent specification requirements in terms of maximum age of the rig and some other rig specifications. And those have been coupled with some fairly low rate caps. And the result of that is that they've been very, very few, if any, new incremental jackups contracted into Mexico. So I think what we're seeing now is PEMEX is beginning to relax some of those recently imposed stringencies. And hopefully, these last few tenders in the next few to come out, we're kind of anxious to see what the specs and the rate cap look like because we'd like to put some more rigs back in there, and we think PEMEX is probably going to have to move a little bit to meet us in the middle, because they have not been successful in attracting the incremental rigs the program calls for.

And follow-up on that, floating rig market, do you see any incremental? I know they talked about bringing in some companies from outside to help, not sure how serious they are, but how about floating market, steady-state or some growth?

Are you talking specifically Mexico?

Yes.

There's been a lot of talk, there's been very little action. Some of the rigs that PEMEX contracted for some time ago are not going to materialize that made some other arrangements, and some of those might not materialize either. So I think Mexico is a very attractive market for the future. I think there'll be a lot of deepwater work done in Mexico. But I think it's a question of PEMEX finally offering a bid specifications in international contractors by an attractive, at which time probably, there'll be a lot of good work done in Mexico in deepwater.

[Operator Instructions] Another question coming from Judd Bailey of Jefferies & Company. Judson Bailey - Jefferies & Company, Inc.: I think the one jackup market that wasn't really touched on in the Q&A was the Gulf of Mexico. You mentioned -- we've seen a slight uptick in rates. Can you give us a little more color on what you're hearing from customers? And do you think this activity and some of the rate movement we've seen, is that sustainable for the rest of the year, even maybe during hurricane season?

Judd, this is Bill. I think so. We've already done an awful lot of work on location analysis through hurricane season for this year. And we've got several locations already reviewed and approved. We've got some major customers that are very active in the Gulf right now, primarily Chevron and Apache. And they're become a lot more proactive than the industry has been in past times in terms of having locations approved and ready to go for hurricane season. So I'm optimistic that we will keep everything working throughout hurricane season this year. Judson Bailey - Jefferies & Company, Inc.: And just one follow-up on the Mexico question. I believe most of your rigs down there currently are the 250-foot class rigs. Based on your discussions with PEMEX, and most of their requirements seem like there the 300-foot and above. What's your level of confidence in keeping some of those rigs in Mexico at this point, most of them roll in 2012?

They don't roll until next year, so that's a long way away. We would certainly like to keep them active down there. PEMEX confirms that they feel like we're doing a pretty good job for them down there, and the people we talk to say they like to retain the rigs. So I'm optimistic. But 2012 is a long way away, especially in that market.

There are no further questions at this time.

Well, thanks very much for everyone participating on our call today. We really appreciate your interest at Ensco. Thank you.

This concludes today's teleconference. You may disconnect your lines at this time. Thank you all for your participation.