Good day, and welcome to Ensco Plc's First Quarter 2012 Earnings Conference Call. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Mr. Sean O'Neill, Vice President of Investor Relations. Please go ahead.

Thank you, operator, and welcome, everyone, to Ensco's first quarter 2012 conference call. With me today are Dan Rabun, CEO; Bill Chadwick, our Chief Operating Officer; Jay Swent, our CFO; as well as other members of our management team. We issued our earnings release, which is available on our website at enscoplc.com. 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 risk factors and other events that could impact future results and disclose important additional information regarding our acquisition. Also, please note that the company undertakes no duty to update its forward-looking statements. As a reminder, our most recent Fleet Status Report was issued on April 18. Before we begin our discussion of first quarter results, we would like to thank everyone who joined us in Corpus Christi, Texas, in April for our Investor Day, as well as everyone who watched our video webcast. We enjoyed meeting with you, and we hope you found the event to be helpful in terms of expanding your knowledge of Ensco. Now let me turn the call over to Dan Rabun, Chairman and CEO.

Thanks, Sean, and good morning, everyone. Before Jay takes us through the financial results, I will discuss first quarter highlights and the state of our markets. Before I do, though, let me also extend our thanks to everyone who participated in our Investors Day. I mentioned last quarter that we were realizing the benefits of our acquisition, and I'm sure, following our Investor Day, the benefits of the acquisition are even more clear. We have a deep pool of talent within our company, ranging from engineering and capital projects, as evidenced by our drillship and high-spec jackup presentations; to operational expertise, as noted in our 8500 Series discussion and tour of ENSCO 8505; to safety management and training and market intelligence. Our talented rig crews and onshore professionals are leveraging the advantages we have in terms of our large customer base, geographic presence, newer fleet and standardization across our rigs. And I'm sure it was evident from our Investor Day that our teams from the various departments have joined together extremely well and are very passionate about their work. I can say this because it was extremely gratifying for us once again to earn the #1 customer satisfaction rating in EnergyPoint's independent survey. In fact, we earned the #1 score in 13 of 17 categories. This is a big achievement in any year but particularly this year given the integration of our 2 companies. Sometimes, employees lose their focus when 2 companies come together. Our employees did not. They remained focused on safety, operational excellence and addressing customer needs, and I'm very proud of their performance during this transition period. Turning now to other highlights during the quarter. ENSCO 8506, the final rig in the 8500 Series, was contracted to Anadarko at $530,000 per day for 2.5 years and will…

Thanks, Dan. My comments today will cover highlights of our first quarter results and our financial position. We provided information on our earnings release that we issued yesterday after the market closed that should assist you in making certain year-to-year comparisons related to our acquisition. Therefore, my comments today will focus mainly on factors, such as the growth of our fleet and rising utilization and day rates, that influence the comparisons between periods. Now let's start with first quarter results versus prior year. Earnings were $1.15 per share, up from $0.45 a year ago. Total revenue for the quarter was $1.03 billion compared to $362 million a year ago. Approximately $461 million of the increase was related to our acquisition. Deepwater revenues increased from $98 million to $549 million, driven primarily by the acquisition as well as the addition of ENSCO 8503 and ENSCO 8504 to the fleet and the commencement of ENSCO 7500, which began its new contract in Brazil in late December following upgrades completing during 2011. Midwater revenues were $91 million, all related to the acquisition. The average day rate was $227,000, and utilization was 68%. Jackup segment revenues increased by approximately 39% primarily due to higher utilization and higher average day rates. Utilization for the entire jackup fleet in the first quarter was 84%, up from 72% a year ago. The average day rate increased $2,000 year-over-year to $99,000 as shown in our earnings release. For our marketed jackup fleet that excludes cold-stacked rigs, utilization was 94%. Total contract drilling expense for all segments was $520 million, up from $192 million in the first quarter of 2011. Excluding $269 million from the effect of our most recent acquisition, contract drilling expense increased $59 million or 31% year-to-year, mostly related to significantly improved utilization in the jackup…

Okay, operator, if you could please open it up for questions?

[Operator Instructions] And our first question comes from Dave Wilson of Howard Weil.

Jay, I know we've spoken about this in the past, about a Class A share listing. But that was at a time when it was unclear as to whether Aon [ph] insurance enrollment would benefit from such a structure. Now that it seems to work for them, do you think ENSCO is going to follow along a similar path? I know you got to weigh the merits of the costs involved with the class -- creating a Class A and the benefits of getting back in the S&P possibly, but I just want to check again if something like that was still under contemplation by you guys.

But -- and the short answer is of course. The longer answer is there were some problems when we did our re-domestication between HMRC and DTC that were very difficult to solve at that point in time and would have been very expensive to try to solve. HMRC has really changed their position on stamp tax, which is what's allowed all of this to happen. So as we look at making the change now, it's not a particularly expensive thing to do, and it doesn't require undue regulatory approval. So I think it'd be safe to assume we're looking at it and we'll move us quickly as we think makes sense.

Okay. Great. And then just as a follow-up on, in your recent Analyst Day, you guys went into some specifics on the 120 Series, the jackups, and introduced some of the designs for the 130 Series. And Dan, I wanted to get an update on the 130 Series and see if you were seeing more customer interest in that type of rig, especially in light of some of your commentary you made on the North Sea.

This is Kevin, Dave. On the 130 Series and the 120 Series, those rigs have a wide operating envelope in the North Sea. So as that market demands that kind of equipment, we are seeing interest. It's also giving some clients alternatives versus some of the semis in that market which are, of course, in tight supply. So yes, we are seeing interest.

And the next question comes from Robin Shoemaker of Citigroup.

I wanted to just ask about the situation with Petrobras, and you mentioned a couple of rigs that they may have tenders open currently. But just looking a little beyond that and given what we've been reading about the challenges of building rigs in Brazil in those first stages, what could you anticipate as coming tenders or requirements in the next year or 2 and in comparison to the total opportunities you see around the world from other operators and how that -- sorry, how that relates to the overall supply of rigs coming out that are currently uncommitted?

Robin, this is Kevin Robert. Regarding Brazil right now, all the questions you asked are currently under study by Petrobras with the recent announcements down there about different shipyards and different projects and different players in those shipyards, along with kind of how the worldwide market has tightened up considerably. Petrobras has stepped back and they're running a study to try to determine what their go-forward position is going to be. But in all scenarios they're looking at, they're looking at increased demand. So where the rigs come from, I think, is a question mark, but the demand is there. And with the recent discoveries they've had, as they move to book those reserves and commit to development programs, our expectation is that we see demand in Brazil increasing. Now, in a worldwide market where the rest of the world is already practically 100% utilized for deepwater rigs in 2012 and it appears that most of '13 is, if not spoken for, close to being spoken for, this -- whether the incremental demand actually adds rigs in Brazil or creates a vacuum where rigs are in short supply in other markets I don't think matters because it's a global market. But we are seeing now a significant requirement being talked about into 2014. So I think that's the takeaway here, is operators are realizing they need to get out in front of this or they're not going to have a rig.

Right. Just following on, Kevin, to that issue about Brazil, you have quite a few rigs that are coming up for contract renewal, not really this year but starting fairly early in '13. And some of them are, especially, well, midwater rigs and some of the deepwater as well, would appear to be pretty low compared to what we've seen as recent fixtures and leading-edge rates for mid and kind of conventional deepwater rigs. So how do think that -- how far in advance of those expirations would you expect to be talking to Petrobras about pricing for or -- on the renewals of those rigs assuming they stay in Brazil?

Yes. One thing to make sure that you're clear on, Robin, is the difference in specifications. The 10,000-foot ultra-deepwater equipment that we see coming out of yards today is very different than the deepwater equipment currently in Brazil. Also, Petrobras still has plenty of work in the existing basins as well as pre-salt. So we are always in dialogue with Petrobras about our rigs down there because we are in their top 2 in terms of size of contractors. So we're always looking for solutions and always in discussion with them about extending rigs and bringing new rigs in.

[Operator Instructions] The next question comes from Waqar Syed of Goldman Sachs

My question relates to the -- can you hear me?

Yes.

Oh, sorry. Okay. So question relates to the 5003. That rig is cold stacked. Is there any future for that rig? Or do you think it just stays cold stacked?

We could put that rig to work on short-term programs. We've made a decision, given the -- what's best for the earnings potential for that rig, not to bring it back out into the market unless we can secure term work, which we feel is the best thing for that rig. So whether or not it has a future or not, certainly, it could be working and it does have a future. It's something that we're being selective about putting back to work.

And the next question comes from Ian Macpherson of Simmons. Ian Macpherson - Simmons & Company International, Research Division: I didn't catch the Noble extension for the 5006, I believe. Is that effective from June? Or is that effective after some price options at the end of this year or early '13?

What they did, Ian, is they termed up the remaining options at the current rate through the end of 2012 and then added a 12-month extension for the calendar year 2013 at $415,000 a day. Ian Macpherson - Simmons & Company International, Research Division: Got it. It seems like everything we're hearing from you and your peers suggest that you're -- you have all this open ultra-deepwater capacity next year. That could start to move pretty quickly in terms of contracting momentum. Is that your expectation, that we could see a lot of your open capacity in your fleet for next year taking off over the next couple of quarters?

I think it's an expectation that you should have for the entire market. But in particular, for our fleet, we are in discussions essentially on all of our 13 availability right now with various clients. Ian Macpherson - Simmons & Company International, Research Division: Good. And can I squeeze in one more follow-up? Jay, there was one -- I'm sorry to be small minded with this question. There was one thing on the P&L that eluded me a little bit, which was below minority interest, another adjustment of a few million dollars to get to your earnings per share. I think it's about $2.5 million, $3 million?

Can I get back to you on that one, Ian? I'll call... Ian Macpherson - Simmons & Company International, Research Division: Yes, yes. No, yes, of course.

[Operator Instructions] The next question comes from John Lawrence of Tudor, Pickering, Holt. John D. Lawrence - Tudor, Pickering, Holt & Co. Securities, Inc., Research Division: Just a question on the cold-stacked jackups. Anything in terms of reactivations or potential sales we're talking about?

John, there are -- we're talking to a number of people about potential sales, and I think we're probably close to some resolution there. At the current time, we are not looking at reactivating any of the cold-stacked jackups. John D. Lawrence - Tudor, Pickering, Holt & Co. Securities, Inc., Research Division: And then just another jackup question on the Gulf of Mexico. Do you think the market is strong enough there where rates can continue to move higher?

John, I hate to speculate on rates. But what I can tell you is that operators are talking about longer terms. There's a real concern amongst the operators in the Gulf of Mexico that if they don't term up some rigs, they may not be able to get the rigs.

This concludes our question-and-answer session. I would like to turn the conference back over to Sean O'Neill for any closing remarks.

Thanks very much, operator. And we appreciate all of your interest in ENSCO, and we'll talk to you on our next call. Thanks very much.