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Transocean Inc. Reports Fourth Quarter and Full-Year 2002 Results

January 30, 2003

HOUSTON--(BUSINESS WIRE)--Jan. 30, 2003--Transocean Inc.(NYSE:RIG) today announced that, including the recognition of non-cashcharges pertaining substantially to goodwill impairment, results forthe three months ended December 31, 2002 were a net loss of $2,780.7million, or $8.71 per diluted share, on revenues of $664.6 million.Excluding the impact of charges relating to goodwill impairment andthe other adjustments detailed below, net income for the three monthsended December 31, 2002 was $101.5 million, or $0.32 per dilutedshare.

During the fourth quarter of 2002, the company conducted itsannual test of impairment for goodwill on its two reporting units,Gulf of Mexico Shallow and Inland Water and International and U.S.Floater Contract Drilling Services, utilizing the fair value of thereporting units at October 1, 2002. The test resulted in a non-cashcharge of $2,876.0 million, or $9.01 per diluted share, with $2,494.1million of the impairment associated with the International and U.S.Floater Contract Drilling Services reporting unit. The company'sgoodwill balance after giving effect to the goodwill write down is$2,218.2 million. In addition, the reported loss for the quarterincluded an after-tax charge of $6.2 million, or $0.02 per dilutedshare, pertaining to an impairment loss on long-lived assetspreviously held for sale.

During the corresponding three months in 2001, net income totaled$56.0 million, or $0.17 per diluted share, on revenues of $747.6million. The fourth quarter 2001 results included a net after-taxcharge of $31.1 million, or $0.10 per diluted share, resulting fromnon-strategic asset impairments, partially offset by net after-taxgains of $17.9 million, or $0.06 per diluted share, resultingpredominately from the sale of a non-strategic asset. A net after-taxextraordinary loss of $1.9 million, pertaining to the early retirementof debt and goodwill amortization of $41.5 million, or $0.13 perdiluted share, were also included in the results for the fourthquarter of 2001. Excluding the asset impairment charges, net gain fromthe sale of assets, extraordinary loss and goodwill amortization, netincome for the three months ended December 31, 2001 was $112.6million, or $0.35 per diluted share.

For the twelve months ended December 31, 2002, the companyreported a net loss of $3,731.9 million, or $11.69 per diluted share,on revenues of $2,673.9 million. Excluding the impact of chargesrelating to goodwill impairment and the other adjustments detailedbelow, net income for the twelve months ended December 31, 2002 was$362.5 million, or $1.14 per diluted share.

Results for 2002 included a non-cash charge of $4,239.7 million,or $13.29 per diluted share, relating to the impairment of goodwillfollowing the company's adoption of Statement of Financial AccountingStandards (SFAS) 142, Goodwill and Other Intangible Assets, and theOctober 2002 annual test as prescribed by SFAS 142. In addition,full-year 2002 results included an after-tax loss of $33.5 million, or$0.10 per diluted share, resulting from the non-cash impairment ofcertain long-lived assets previously held for sale. These charges werepartially offset by a tax benefit totaling $175.7 million, or $0.55per diluted share, attributable to the restructuring of certainnon-U.S. operations, and a net after-tax gain of $3.1 million, or$0.01 per diluted share, relating to the sale of assets.

For the twelve months ended December 31, 2001, net income was$252.6 million, or $0.80 per diluted share, on revenues of $2,820.1million. The full-year 2001 results included an after-tax charge of$31.1 million, or $0.10 per diluted share, relating to the impairmentof non-strategic assets, a net after-tax extraordinary loss onretirement of debt of $19.3 million, or $0.06 per diluted share, andgoodwill amortization totaling $154.9 million, or $0.49 per dilutedshare. These items were partially offset by a net after-tax gain of$44.5 million, or $0.14 per diluted share, resulting from the sale ofassets. After adjusting for the asset impairment charges,extraordinary loss, goodwill amortization and net gain from the saleof assets, net income for the twelve months ended December 31, 2001was $413.4 million, or $1.31 per diluted share.

During the three months ended December 31, 2002, the company'sInternational and U.S. Floater Contract Drilling Services segmentreported revenues of $612.6 million and field operating profit(defined as revenues less operating and maintenance expenses) of$295.8 million. The results compare to revenues of $641.2 million andfield operating profit of $315.5 million during the three months endedSeptember 30, 2002. The decline in revenues and field operating profitwas primarily attributable to deteriorating utilization and dayratelevels within the company's fleet of semisubmersible drilling rigscapable of operating in water depths of up to 3,000 feet.

Revenues generated by the company's Gulf of Mexico Shallow andInland Water segment during the fourth quarter of 2002 totaled $52.0million, while field operating profit was $2.3 million. The segmentresults compare to revenues of $54.0 million and a field operatingloss of $1.4 million for the three months ended September 30, 2002.

The company's cash and cash equivalents balance at December 31,2002 increased to $1,214.2 million, reducing net debt to $3,282.5million, down from $3,508.8 million and $4,155.3 million at September30, 2002 and December 31, 2001, respectively. At January 30, 2003, thecompany had 51% of the remaining fleet days in 2003 associated withits International and U.S. Floater Contract Drilling Services segmentcommitted to firm contracts, including 59% of the days associated withits high specification fleet, which substantially consists of thecompany's ultra-deepwater drilling rigs.

Commenting on the company's prospects for the initial quarter of2003, Robert L. Long, President and Chief Executive Officer ofTransocean Inc., stated, \"Utilization of our fleet of other floaters(specifically second and third generation semisubmersible rigs) isexpected to remain depressed and we expect these units to experiencelower dayrates than those seen in the preceding quarter. This isespecially true for the fleet of other floaters in the North Sea,where utilization stood at 46% in the quarter just completed and isnot expected to show measurable improvement before the second quarterof 2003. In addition, the utilization of our high-specification fleetis expected to decline from levels experienced in the fourth quarterof 2002 with the deepwater drillship Discoverer Seven Seas andsemisubmersible rig Jack Bates idle. The deepwater semisubmersible rigTransocean Rather should also be idle for the majority of the quarter.Significant potential for earnings variability currently exists in2003 as a result of the estimated 49% of fleet time that remainsuncommitted. This variability is demonstrated by the current analystestimates of diluted earnings per share for the first quarter of $0.11to $0.30. Our current expectations are for diluted earnings per shareto be at the low end of this range, or approximately $0.11 to $0.16.\"

Statements regarding future utilization, dayrates, expectedearnings per share range, as well as any other statements that are nothistorical facts in this release, are forward-looking statements thatinvolve certain risks, uncertainties and assumptions. These includebut are not limited to the future price of oil and gas, demand forrigs, operating hazards and delays, risks associated withinternational operations, actions by customers and other thirdparties, competition, risks of drilling, contract terminations orsuspensions and other factors detailed in the company's most recentForm 10-K for the year ended December 31, 2001 and other filings withthe Securities and Exchange Commission. Should one or more of theserisks or uncertainties materialize, or should underlying assumptionsprove incorrect, actual results may vary materially from thoseindicated.

Conference Call Information

The company will conduct a teleconference call at 10:00 a.m. ET onJanuary 30, 2003. Individuals who wish to participate in theteleconference call should dial 212/329-1454 approximately five to 10minutes prior to the scheduled start time of the call.

In addition, the conference call will be simulcast through alisten-only broadcast over the Internet and can be accessed by loggingonto the company's Worldwide Web address at www.deepwater.com andselecting \"Investor Relations.\" It may also be accessed via theWorldwide Web at www.CompanyBoardroom.com by typing in the company'sNYSE trading symbol, \"RIG.\"

A telephonic replay of the conference call should be availableafter 1:00 p.m. ET on January 30 and can be accessed by dialing303/590-3000 and referring to the passcode 519997. Also, a replay willbe available through the Internet and can be accessed by visitingeither of the above-referenced Worldwide Web addresses. Both replayoptions will be available for approximately 30 days.

Monthly Fleet Update Information

Drilling rig status and contract information on Transocean Inc.'soffshore drilling fleet has been condensed into two reports titled\"Monthly Fleet Update\" and \"Monthly Fleet Update - Jackups andBarges,\" which are available through the company's Website atwww.deepwater.com. The reports are located in the \"InvestorRelations/Financial Reports\" section of the Website. By subscribing tothe Transocean Financial Report Alert, you will be immediatelynotified when new postings are made to this page by an automatede-mail, which will provide a link directly to the page that has beenupdated. Shareholders and other interested parties are invited to signup for this service.

Transocean Inc. is the world's largest offshore drillingcontractor with more than 150 full or partially owned and managedmobile offshore drilling units, inland drilling barges and otherassets utilized in the support of offshore drilling activitiesworldwide. The company's mobile offshore drilling fleet is consideredone of the most modern and versatile in the world with 31high-specification semisubmersibles and drillships, 27 othersemisubmersibles and two other drillships, and 55 jackup drillingrigs. Transocean Inc. specializes in technically demanding segments ofthe offshore drilling business, including industry-leading positionsin deepwater and harsh environment drilling services. With a currentequity market capitalization of approximately $7 billion, thecompany's ordinary shares are traded on the New York Stock Exchangeunder the symbol \"RIG.\"

                   TRANSOCEAN INC. AND SUBSIDIARIES                 CONSOLIDATED STATEMENTS OF OPERATIONS                 (In millions, except per share data)                              Three Months Ended  Twelve Months Ended                                 December 31,         December 31,                              ------------------- --------------------                                 2002      2001      2002      2001                              ---------- -------- ---------- ---------Operating Revenues               $664.6   $747.6   $2,673.9  $2,820.1Costs and Expenses  Operating and maintenance       366.5    439.8    1,494.2   1,603.3  Depreciation                    126.2    121.8      500.3     470.1  Goodwill amortization               -     41.5          -     154.9  General and administrative       14.0     14.0       65.6      57.9  Impairment Loss on Long-   Lived Assets                 2,885.4     40.4    2,927.4      40.4  Gain from Sale of Assets,   net                             (0.2)   (27.5)      (3.7)    (56.5)                                3,391.9    630.0    4,983.8   2,270.1Operating Income (Loss)        (2,727.3)   117.6   (2,309.9)    550.0Other Income (Expense), net  Equity in earnings of joint   ventures                         3.0      4.5        7.8      16.5  Interest income                   9.6      5.0       25.6      18.7  Interest expense, net of   amounts capitalized            (51.3)   (59.1)    (212.0)   (223.9)  Other, net                       (0.5)     1.2       (0.3)     (0.8)                                  (39.2)   (48.4)    (178.9)   (189.5)Income (Loss) Before Income Taxes, Minority Interest, Extraordinary Items and Cumulative Effect of a Change in Accounting Principle          (2,766.5)    69.2   (2,488.8)    360.5Income Tax Expense (Benefit)       14.1     10.8     (123.0)     85.7Minority Interest                   0.1      0.5        2.4       2.9Net Income (Loss) Before Extraordinary Items and Cumulative Effect of a Change in Accounting Principle       (2,780.7)    57.9   (2,368.2)    271.9Loss on Extraordinary Items, net of tax                           -     (1.9)         -     (19.3)Cumulative Effect of  a Change in Accounting Principle              -        -   (1,363.7)        -Net Income (Loss)             $(2,780.7)   $56.0  $(3,731.9)   $252.6Basic Earnings (Loss) Per Share  Income (Loss) Before   Extraordinary Items and   Cumulative Effect of a   Change in Accounting   Principle                     $(8.71)   $0.18     $(7.42)    $0.88  Loss on Extraordinary Items,   net of tax                         -        -          -     (0.06)  Loss on Cumulative Effect of   a Change in Accounting   Principle                          -        -      (4.27)        -  Net Income (Loss)              $(8.71)   $0.18    $(11.69)    $0.82Diluted Earnings (Loss) Per Share  Income (Loss) Before   Extraordinary Items and   Cumulative Effect of a   Change in Accounting   Principle                     $(8.71)   $0.17     $(7.42)    $0.86  Loss on Extraordinary Items,   net of tax                         -        -          -     (0.06)  Loss on Cumulative Effect of   a Change in Accounting   Principle                          -        -      (4.27)        -  Net Income (Loss)              $(8.71)   $0.17    $(11.69)    $0.80Weighted Average Shares Outstanding  Basic                           319.2    318.7      319.1     309.2  Diluted                         319.2    322.7      319.1     314.8    On January 31, 2001, the Company completed a merger transactionwith R&B Falcon Corporation. As a result of the merger, R&B FalconCorporation became an indirect wholly owned subsidiary of the Company.The Company accounted for the merger using the purchase method ofaccounting with the Company treated as the accounting acquiror. Theabove Consolidated Statement of Operations for the twelve months endedDecember 31, 2001 includes eleven months of operating results of R&BFalcon Corporation.                   TRANSOCEAN INC. AND SUBSIDIARIES                      CONSOLIDATED BALANCE SHEETS                   (In millions, except share data)                                                  Dec. 31,   Dec. 31,                                                 ---------------------                                                    2002       2001                                                 ---------- ----------                                ASSETSCash and Cash Equivalents                         $1,214.2     $853.4Accounts Receivable   Trade                                             437.6      602.9   Other                                              61.7       72.8Materials and Supplies                               155.8      158.8Deferred Income Taxes                                 21.9       21.0Other Current Assets                                  20.5       27.9   Total Current Assets                            1,911.7    1,736.8Property and Equipment                            10,198.0   10,081.4Less Accumulated Depreciation                      2,168.2    1,713.3   Property and Equipment, net                     8,029.8    8,368.1Goodwill, net                                      2,218.2    6,466.7Investments in and Advances to Joint Ventures        108.5      107.1Deferred Income Tax                                   26.2       28.0Other Assets                                         370.7      341.1   Total Assets                                  $12,665.1  $17,047.8                 LIABILITIES AND SHAREHOLDERS' EQUITYAccounts Payable                                    $134.1     $188.4Accrued Income Taxes                                  59.5      118.3Debt Due Within One Year                           1,048.1      484.4Other Current Liabilities                            262.2      283.4   Total Current Liabilities                       1,503.9    1,074.5Long-Term Debt                                     3,629.9    4,539.4Deferred Income Taxes                                107.2      345.1Other Long-Term Liabilities                          282.7      178.5   Total Long-Term Liabilities                     4,019.8    5,063.0Commitments and ContingenciesPreference Shares, $0.10 par value; 50,000,000 shares authorized, none issued and outstanding          -          -Ordinary Shares, $0.01 par value; 800,000,000 shares authorized, 319,219,072 and 318,816,035  shares issued and outstanding at December 31,  2002 and 2001, respectively                           3.2        3.2Additional Paid-in Capital                        10,623.1   10,611.7Accumulated Other Comprehensive Income               (31.5)      (2.3)Retained Earnings (Deficit)                       (3,453.4)     297.7   Total Shareholders' Equity                      7,141.4   10,910.3   Total Liabilities and Shareholders' Equity    $12,665.1  $17,047.8Consolidated Debt                                 $4,678.0   $5,023.8Less: Cash and Cash Equivalents                    1,214.2      853.4Less: Swap Receivable                                181.3       15.1Net Debt                                          $3,282.5   $4,155.3Net Debt/Tangible Capital (excluding Goodwill, net)                                                 40.0%      48.3%                   TRANSOCEAN INC. AND SUBSIDIARIES                 CONSOLIDATED STATEMENTS OF CASH FLOWS                             (In millions)                                              Years Ended December 31,                                              ------------------------                                                 2002          2001                                              ----------    ----------Cash Flows from Operating Activities Net income (loss)                            $(3,731.9)       $252.6 Adjustments to reconcile net income (loss)  to net cash provided by operating  activities    Depreciation                                  500.3         470.1    Goodwill amortization                             -         154.9    Impairment loss on goodwill                 4,239.7             -    Deferred income taxes                        (224.4)        (98.2)    Equity in earnings of joint ventures           (7.8)        (16.5)    Net (gain) loss from disposal of assets         3.9         (52.5)    Impairment loss on long-lived assets           51.4          40.4    Amortization of debt-related     discounts/premiums, fair value     adjustments and issue costs, net               6.2          (4.0)    Deferred income, net                           (6.0)        (46.5)    Deferred expenses, net                        (20.0)        (53.8)    Tax benefit from exercise of stock     options                                        0.3           9.6    Extraordinary loss on debt     extinguishment, net of tax                       -          19.3    Other, net                                      3.9          (6.8)    Changes in operating assets and     liabilities, net of effects from the     R&B Falcon merger       Accounts receivable                        179.4         (55.2)       Accounts payable and other current        liabilities                               (78.8)        (95.9)       Income taxes receivable/payable, net         8.9          48.2       Other current assets                        11.5          (5.3)Net Cash Provided by Operating Activities         936.6         560.4Cash Flows from Investing Activities Capital expenditures                            (141.0)       (506.2) Proceeds from sale of securities                     -          17.2 Proceeds from sale of subsidiary                     -          85.6 Proceeds from disposal of assets, net             88.3         116.1 Merger costs paid                                    -         (24.4) Cash acquired in merger, net of cash paid            -         264.7 Joint ventures and other investments, net          7.4          20.6Net Cash Used in Investing Activities             (45.3)        (26.4)Cash Flows from Financing Activities Net borrowings (repayments) on revolving  credit agreements                                   -        (180.1) Net borrowings (repayments) under commercial  paper program                                  (326.4)        326.4 Net proceeds from issuance of other debt             -       1,693.5 Net repayments on other debt obligations        (189.3)     (1,551.0) Net proceeds from issuance of ordinary  shares under stock-based compensation plans      10.2          29.6 Decrease in cash dedicated to debt service           -           6.4 Proceeds from issuance of ordinary shares  upon exercise of warrants                           -          10.6 Dividends paid                                   (19.1)        (38.2) Financing costs                                   (8.5)        (15.2) Other, net                                         2.6           2.9Net Cash Provided by (Used in) Financing Activities                                      (530.5)        284.9Net Increase in Cash and Cash Equivalents         360.8         818.9Cash and Cash Equivalents at Beginning of Period                                           853.4          34.5Cash and Cash Equivalents at End of Period     $1,214.2        $853.4                            Transocean Inc.                      Fleet Operating Statistics                             Operating Revenues ($ Millions)                   ---------------------------------------------------                                                  Twelve Months Ended                        Three Months Ended             Dec. 31,                   ----------------------------- ---------------------International and U.S. Floater Contract Drilling  Dec. 31, Sept. 30,  Dec. 31,               2001 Services Segment:    2002      2002    2001 (2)    2002      (1)(2)                   --------- --------- --------- --------- -----------  High-Specification   Floaters          $365.2    $326.4    $354.7  $1,336.6    $1,289.4  Other Floaters     $113.9    $157.8    $176.9    $579.1      $611.2  Jackups -    Non-U.S.          $114.5    $117.0    $112.5    $462.9      $352.8  Other               $19.0     $40.0     $34.3    $107.5      $213.9Segment Total        $612.6    $641.2    $678.4  $2,486.1    $2,467.3Gulf of Mexico Shallow and Inland Water Segment:  Jackups and   Submersibles       $20.8     $21.7     $24.4     $73.1      $253.1  Inland Barges       $24.8     $27.5     $32.0     $87.5      $171.7  Other                $6.4      $4.8     $12.8     $27.2       $53.9Segment Total         $52.0     $54.0     $69.2    $187.8      $478.7Total Company        $664.6    $695.2    $747.6  $2,673.9    $2,946.0                                  Average Dayrates (3)                   ---------------------------------------------------                                                  Twelve Months Ended                        Three Months Ended             Dec. 31,                   ----------------------------- ---------------------International and U.S. Floater Contract Drilling  Dec. 31, Sept. 30,  Dec. 31, Services Segment:    2002      2002      2001     2002      2001 (1)                   --------- --------- --------- --------- -----------  High-Specification   Floaters        $147,700  $144,600  $145,000  $147,000    $141,800  Other Floaters    $78,800   $81,300   $71,100   $78,500     $65,100  Jackups -    Non-U.S.         $57,700   $60,400   $52,800   $58,600     $46,500  Other             $40,500   $55,100   $41,300   $45,800     $39,900Segment Total       $97,200   $95,500   $88,200   $94,500     $83,600Gulf of Mexico Shallow and Inland Water Segment:  Jackups and   Submersibles     $21,900   $23,000   $30,600   $22,000     $36,800  Inland Barges     $19,600   $20,700   $22,800   $19,900     $22,400Segment Total       $20,600   $21,600   $25,600   $20,800     $29,200Total Mobile Offshore Drilling Fleet              $77,200   $76,400   $74,000   $77,600     $64,900                                     Utilization (3)                   ---------------------------------------------------                                                  Twelve Months Ended                        Three Months Ended             Dec. 31,                   ----------------------------- ---------------------International and U.S. Floater Contract Drilling  Dec. 31, Sept. 30,  Dec. 31, Services Segment:    2002      2002      2001      2002     2001 (1)                   --------- --------- --------- --------- -----------  High-Specification   Floaters              93%       85%       90%       85%         86%  Other Floaters         56%       76%       89%       72%         81%  Jackups -    Non-U.S.              83%       84%       89%       85%         84%  Other                  47%       51%       54%       54%         52%Segment Total            75%       79%       86%       78%         81%Gulf of Mexico Shallow and Inland Water Segment:  Jackups and   Submersibles          33%       34%       27%       30%         57%  Inland Barges          44%       47%       49%       39%         66%Segment Total            39%       40%       38%       34%         61%Total Mobile Offshore Drilling Fleet                   60%       63%       67%       61%         73%(1) Transocean completed a merger transaction with R&B Falcon on    January 31, 2001. Therefore, operating revenues, average dayrates    and utilization for the twelve months ended December 31, 2001 are    stated as pro forma results based on the combined fleet of    Transocean and R&B Falcon.(2) Certain reclassifications have been made to prior periods to    conform to current quarter presentation.(3) Average dayrates are defined as revenue earned per revenue earning    day and utilization is defined as the percentage of revenue    earning days to days available. These terms are applicable to core    assets only, defined as high-specification drillships and    semisubmersibles (\"floaters\"), other floaters, jackup rigs,    drilling barges, tenders and submersible drilling rigs.

CONTACT:
Transocean Inc., Houston
Analyst Contact:
Jeffrey L. Chastain, 713/232-7551
or
Media Contact:
Guy A. Cantwell, 713/232-7647