================================================================================
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                             ______________________

                                    FORM 10-Q
(Mark One)
[X]   QUARTERLY  REPORT  PURSUANT  TO  SECTION  13  OR 15(d) OF THE SECURITIES
      EXCHANGE  ACT  OF  1934

                  FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2004

                                       OR

[ ]   TRANSITION  REPORT  PURSUANT  TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE  ACT  OF  1934

                FOR THE TRANSITION PERIOD FROM ______ TO ______.

                        COMMISSION FILE NUMBER 333-75899
                             ______________________

                                 TRANSOCEAN INC.
             (Exact name of registrant as specified in its charter)
                             ______________________

              CAYMAN ISLANDS                               66-0582307
       (State or other jurisdiction                     (I.R.S. Employer
      of incorporation or organization)                Identification No.)

              4  GREENWAY  PLAZA
                HOUSTON,  TEXAS                                 77046
 (Address  of  principal  executive  offices)                (Zip  Code)

       Registrant's telephone number, including area code: (713) 232-7500
                             ______________________

     Indicate  by  check  mark  whether the registrant (1) has filed all reports
required  to  be  filed by Section 13 or 15(d) of the Securities Exchange Act of
1934  during  the  preceding  12  months  (or  for  such shorter period that the
registrant  was required to file such reports), and (2) has been subject to such
filing  requirements  for  the  past  90  days.  Yes     X    No
                                                      -------     -------

     Indicate  by  check mark whether the registrant is an accelerated filer (as
defined  in  Rule  12b-2  of  the  Exchange  Act).  Yes     X    No
                                                         -------     -------

     As  of  July  30,  2004,  320,841,141  ordinary shares, par value $0.01 per
share,  were  outstanding.

================================================================================


<PAGE>
                                 TRANSOCEAN INC.

                               INDEX TO FORM 10-Q

                           QUARTER ENDED JUNE 30, 2004

                                                                            Page
                                                                            ----

PART  I  -  FINANCIAL  INFORMATION
----------------------------------

   ITEM  1.  Financial  Statements  (Unaudited)

        Condensed  Consolidated  Statements  of  Operations
           Three  and  Six  Months  Ended  June  30,  2004  and  2003          1

        Condensed  Consolidated  Statements  of  Comprehensive  Income
           Three  and  Six  Months  Ended  June  30,  2004  and  2003          2

        Condensed  Consolidated  Balance  Sheets
           June  30,  2004  and  December  31,  2003                           3

        Condensed  Consolidated  Statements  of  Cash  Flows
          Three  and  Six  Months  Ended  June  30,  2004  and  2003           4

        Notes  to  Condensed  Consolidated  Financial  Statements              5

   ITEM  2.  Management's  Discussion  and  Analysis  of  Financial
             Condition  and  Results  of  Operations                          19

   ITEM  3.  Quantitative and Qualitative Disclosures About Market Risk       43

   ITEM  4.  Controls  and  Procedures                                        44

PART  II  -  OTHER  INFORMATION
-------------------------------

   ITEM  1.  Legal  Proceedings                                               45

   ITEM  4.  Submission  of  Matters  to  a  Vote  of  Security Holders       45

   ITEM  5.  Other  Information                                               45

   ITEM  6.  Exhibits  and  Reports  on  Form  8-K                            46


<PAGE>
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                                         TRANSOCEAN INC. AND SUBSIDIARIES
                                  CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                       (In millions, except per share data)
                                                   (Unaudited)

                                                              Three Months Ended June 30,       Six Months Ended June 30,
                                                          ---------------------------------  -------------------------------
                                                                2004             2003             2004            2003
                                                          ----------------  ---------------  --------------  ---------------
<S>                                                       <C>               <C>              <C>             <C>
Operating Revenues
  Contract drilling revenues                              $         584.9   $        574.7   $     1,182.4   $      1,162.2
  Other revenues                                                     48.3             29.2           102.8             57.7
----------------------------------------------------------------------------------------------------------------------------
                                                                    633.2            603.9         1,285.2          1,219.9
----------------------------------------------------------------------------------------------------------------------------
Costs and Expenses
  Operating and maintenance                                         406.2            426.5           818.6            800.6
  Depreciation                                                      133.0            127.5           264.5            254.3
  General and administrative                                         14.0             14.9            29.1             28.8
  Impairment loss on long-lived assets                                  -             15.8               -             16.8
  Gain from sale of assets, net                                     (23.8)            (0.6)          (27.6)            (2.0)
  Gain from TODCO initial public offering                               -                -           (39.4)               -
----------------------------------------------------------------------------------------------------------------------------
                                                                    529.4            584.1         1,045.2          1,098.5
----------------------------------------------------------------------------------------------------------------------------

Operating Income                                                    103.8             19.8           240.0            121.4

Other Income (Expense), net
  Equity in earnings of joint ventures                                3.7              1.8             6.0              5.4
  Interest income                                                     1.9              5.8             4.0             12.7
  Interest expense                                                  (42.6)           (52.8)          (90.0)          (105.4)
  Loss on retirement of debt                                            -            (15.7)          (28.1)           (15.7)
  Impairment loss on note receivable from related party                 -            (21.3)              -            (21.3)
  Other, net                                                         (1.1)            (2.7)            0.3             (3.3)
----------------------------------------------------------------------------------------------------------------------------
                                                                    (38.1)           (84.9)         (107.8)          (127.6)
----------------------------------------------------------------------------------------------------------------------------

Income (Loss) Before Income Taxes and Minority Interest              65.7            (65.1)          132.2             (6.2)
Income Tax Expense (Benefit)                                         19.9            (20.8)           67.9             (9.0)
Minority Interest                                                    (2.2)             0.2            (6.4)             0.1
----------------------------------------------------------------------------------------------------------------------------

Net Income (Loss)                                         $          48.0   $        (44.5)  $        70.7   $          2.7
============================================================================================================================

Earnings (Loss) Per Share
   Basic and Diluted                                      $          0.15   $        (0.14)  $        0.22   $          .01
============================================================================================================================

Weighted Average Shares Outstanding
   Basic                                                            320.8            319.8           320.7            319.7
----------------------------------------------------------------------------------------------------------------------------
   Diluted                                                          324.1            319.8           324.2            321.5
----------------------------------------------------------------------------------------------------------------------------
</TABLE>


                                                   See accompanying notes
                                                             1
<PAGE>
<TABLE>
<CAPTION>
                                         TRANSOCEAN INC. AND SUBSIDIARIES
                             CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
                                                  (In millions)
                                                   (Unaudited)

                                                                   Three Months Ended June 30,        Six Months Ended June 30,
                                                                ---------------------------------  -------------------------------
                                                                      2004             2003             2004            2003
                                                                ----------------  ---------------  --------------  ---------------
<S>                                                             <C>               <C>              <C>             <C>

Net Income (Loss)                                               $          48.0   $        (44.5)  $        70.7   $          2.7
----------------------------------------------------------------------------------------------------------------------------------
Other Comprehensive Income (Loss), net of tax
  Amortization of gain on terminated interest rate swaps                   (0.1)            (0.1)           (0.2)            (0.1)
  Change in unrealized loss on securities available for sale               (0.1)             0.2            (0.1)             0.2
  Change in share of unrealized loss in unconsolidated joint
    venture's interest rate swaps (net of tax of $0.6 for the
    three and six months ended June 30, 2003)                                 -              1.4               -              1.1
  Minimum pension liability adjustments (net of tax of  $0.2
    for the three and six months ended June 30, 2004 and $0.4
    million for the six months ended June 30, 2003)                         0.5              0.1             0.5              0.8
----------------------------------------------------------------------------------------------------------------------------------
Other Comprehensive Income                                                  0.3              1.6             0.2              2.0
----------------------------------------------------------------------------------------------------------------------------------
Total Comprehensive Income (Loss)                               $          48.3   $        (42.9)  $        70.9   $          4.7
==================================================================================================================================
</TABLE>


                                                   See accompanying notes
                                                             2
<PAGE>
<TABLE>
<CAPTION>
                                  TRANSOCEAN INC. AND SUBSIDIARIES
                                CONDENSED CONSOLIDATED BALANCE SHEETS
                                  (In millions, except share data)


                                                                                June 30,     December 31,
                                                                                  2004           2003
                                                                              ------------  --------------
                                                                               (Unaudited)
                                           ASSETS

<S>                                                                           <C>           <C>
Cash and Cash Equivalents                                                     $     322.1   $       474.0
Accounts Receivable, net of allowance for doubtful accounts of $11.9
  and $29.1 at June 30, 2004 and December 31, 2003, respectively                    512.1           480.3
Materials and Supplies, net of allowance for obsolescence of $18.0 and $17.5
  at June 30, 2004 and December 31, 2003, respectively                              151.9           152.0
Deferred Income Taxes                                                                39.2            41.0
Other Current Assets                                                                 47.2            31.6
----------------------------------------------------------------------------------------------------------
    Total Current Assets                                                          1,072.5         1,178.9
----------------------------------------------------------------------------------------------------------

Property and Equipment                                                           10,642.3        10,673.0
Less Accumulated Depreciation                                                     2,863.5         2,663.4
----------------------------------------------------------------------------------------------------------
    Property and Equipment, net                                                   7,778.8         8,009.6
----------------------------------------------------------------------------------------------------------

Goodwill                                                                          2,232.0         2,230.8
Investments in and Advances to Joint Ventures                                         6.8             5.5
Deferred Income Taxes                                                                28.2            28.2
Other Assets                                                                        217.4           209.6
----------------------------------------------------------------------------------------------------------
    Total Assets                                                              $  11,335.7   $    11,662.6
----------------------------------------------------------------------------------------------------------

                              LIABILITIES AND SHAREHOLDERS' EQUITY

Accounts Payable                                                              $     157.3   $       146.1
Accrued Income Taxes                                                                 54.7            57.2
Debt Due Within One Year                                                            398.9            45.8
Other Current Liabilities                                                           260.9           262.0
----------------------------------------------------------------------------------------------------------
    Total Current Liabilities                                                       871.8           511.1
----------------------------------------------------------------------------------------------------------

Long-Term Debt                                                                    2,678.0         3,612.3
Deferred Income Taxes                                                                69.2            42.8
Other Long-Term Liabilities                                                         310.1           299.4
----------------------------------------------------------------------------------------------------------
    Total Long-Term Liabilities                                                   3,057.3         3,954.5
----------------------------------------------------------------------------------------------------------

Commitments and Contingencies

Minority Interest                                                                   120.8             4.4

Preference 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,
  320,819,763 and 319,926,500 shares issued and outstanding at
  June 30, 2004 and December 31, 2003, respectively                                   3.2             3.2
Additional Paid-in Capital                                                       10,666.1        10,643.8
Accumulated Other Comprehensive Loss                                                (20.0)          (20.2)
Retained Deficit                                                                 (3,363.5)       (3,434.2)
----------------------------------------------------------------------------------------------------------
    Total Shareholders' Equity                                                    7,285.8         7,192.6
----------------------------------------------------------------------------------------------------------
    Total Liabilities and Shareholders' Equity                                $  11,335.7   $    11,662.6
==========================================================================================================
</TABLE>


                                          See accompanying notes
                                                    3
<PAGE>
<TABLE>
<CAPTION>
                                            TRANSOCEAN INC. AND SUBSIDIARIES
                                     CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                      (In millions)
                                                       (Unaudited)


                                                                  Three Months Ended June 30,       Six Months Ended June 30,
                                                               ---------------------------------  -------------------------------
                                                                     2004             2003             2004             2003
                                                               ----------------  ---------------  ---------------  --------------
<S>                                                            <C>               <C>              <C>              <C>

CASH FLOWS FROM OPERATING ACTIVITIES
  Net income (loss)                                            $          48.0   $        (44.5)  $         70.7   $         2.7
  Adjustments to reconcile net income (loss) to
    net cash provided by operating activities
      Depreciation                                                       133.0            127.5            264.5           254.3
      Deferred income taxes                                               (3.3)           (87.1)            28.0           (59.5)
      Equity in earnings of joint ventures                                (3.7)            (1.8)            (6.0)           (5.4)
      Net (gain) loss from disposal of assets                            (23.1)             8.5            (25.0)            7.8
      Gain from TODCO initial public offering                                -                -            (39.4)              -
      Loss on retirement of debt                                             -             15.7             28.1            15.7
      Impairment loss on long-lived assets                                   -             15.8                -            16.8
      Impairment loss on note receivable from related party                  -             21.3                -            21.3
      Amortization of debt-related discounts/premiums, fair
        value adjustments and issue costs, net                            (4.9)            (6.1)           (12.5)           (7.9)
      Deferred income, net                                                17.4             (8.0)            14.1            (1.6)
      Deferred expenses, net                                             (10.8)             7.5            (12.7)            2.7
      Other long-term liabilities                                          4.7              6.6              6.9            13.5
      Other, net                                                           3.9              7.3              9.2             8.0
      Changes in operating assets and liabilities
        Accounts receivable                                              (61.6)            34.0            (31.8)           51.6
        Accounts payable and other current liabilities                   (23.5)           (44.0)             0.1            (1.6)
        Income taxes receivable/payable, net                               4.4             50.3              2.0             9.6
        Other current assets                                               8.9             11.2            (15.6)          (23.3)
---------------------------------------------------------------------------------------------------------------------------------
Net Cash Provided by Operating Activities                                 89.4            114.2            280.6           304.7
---------------------------------------------------------------------------------------------------------------------------------

CASH FLOWS FROM INVESTING ACTIVITIES
      Capital expenditures                                               (37.3)           (25.8)           (55.8)          (50.2)
      Note issued to related party, net of repayments                        -            (45.3)               -           (45.3)
      Proceeds from disposal of assets, net                               31.5              1.0             42.0             3.2
      Deepwater Drilling II LLC's cash acquired, net of cash
        paid                                                                 -             18.1                -            18.1
      Proceeds from TODCO initial public offering                            -                -            155.7               -
      Joint ventures and other investments, net                            3.2              0.8              4.7             2.2
---------------------------------------------------------------------------------------------------------------------------------
Net Cash Provided by (Used in) Investing Activities                       (2.6)           (51.2)           146.6           (72.0)
---------------------------------------------------------------------------------------------------------------------------------

CASH FLOWS FROM FINANCING ACTIVITIES
      Repayments on revolving credit agreements                         (150.0)               -           (200.0)              -
      Repayments on other debt instruments                               (13.6)          (871.4)          (395.2)         (919.2)
      Cash from termination of interest rate swaps                           -                -                -           173.5
      Net proceeds from issuance of ordinary shares under
        stock-based compensation plans                                     1.0              0.8             15.0            11.7
      Other, net                                                             -              1.2              1.1             1.1
---------------------------------------------------------------------------------------------------------------------------------
Net Cash Used in Financing Activities                                   (162.6)          (869.4)          (579.1)         (732.9)
---------------------------------------------------------------------------------------------------------------------------------

Net Decrease in Cash and Cash Equivalents                                (75.8)          (806.4)          (151.9)         (500.2)
---------------------------------------------------------------------------------------------------------------------------------
Cash and Cash Equivalents at Beginning of Period                         397.9          1,520.4            474.0         1,214.2
---------------------------------------------------------------------------------------------------------------------------------
Cash and Cash Equivalents at End of Period                     $         322.1   $        714.0   $        322.1   $       714.0
=================================================================================================================================
</TABLE>


                                                   See accompanying notes
                                                              4
<PAGE>
                        TRANSOCEAN INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 1 - NATURE OF BUSINESS AND PRINCIPLES OF CONSOLIDATION

     Transocean  Inc.  (together  with our subsidiaries and predecessors, unless
the  context requires otherwise, "Transocean," "we," "us" or "our") is a leading
international  provider  of  offshore contract drilling services for oil and gas
wells.  As  of  June  30,  2004, we owned, had partial ownership interests in or
operated 95 mobile offshore and barge drilling units, excluding the 70-rig fleet
of  TODCO  (together  with its subsidiaries and predecessors, unless the context
requires  otherwise,  "TODCO"),  a  publicly  traded  company  in which we own a
majority  interest.  We  contract  our drilling rigs, related equipment and work
crews  primarily  on a dayrate basis to drill oil and gas wells. We also provide
additional  services, including integrated well services and management of third
party  well  service  activities.

     On  January  31,  2001,  we completed a merger transaction (the "R&B Falcon
merger")  with R&B Falcon Corporation ("R&B Falcon"). At the time of the merger,
R&B  Falcon  owned,  had  partial  ownership interests in, operated or had under
construction  more  than  100  mobile  offshore  drilling  units  consisting  of
drillships,  semisubmersibles, jackup rigs and other units including the Gulf of
Mexico  Shallow  and  Inland Water segment fleet. As a result of the merger, R&B
Falcon became our indirect wholly owned subsidiary. The merger was accounted for
as  a  purchase  and  we  were  the  accounting  acquiror.

     In  July  2002,  we  announced plans to pursue a divestiture of our Gulf of
Mexico  Shallow  and  Inland Water business, which was a part of R&B Falcon. R&B
Falcon's  overall  business  was  considerably  broader  than the Gulf of Mexico
Shallow and Inland Water business. In preparation for this divestiture, we began
the  transfer of all assets and businesses out of R&B Falcon that were unrelated
to  the  Gulf of Mexico Shallow and Inland Water business. In December 2002, R&B
Falcon  changed  its  name  to  TODCO  and,  in January 2004, the Gulf of Mexico
Shallow  and Inland Water business segment became known as the TODCO segment. In
February  2004,  we  completed an initial public offering ("IPO") of  TODCO (see
Note  3).  Before  the  closing  of the IPO, TODCO completed the transfer of all
unrelated  assets  and  businesses  to  us.

     Our  operations  are  aggregated into two reportable business segments: (i)
Transocean  Drilling and (ii) TODCO. We provide services with different types of
drilling  equipment in several geographic regions. The location of our operating
assets  and  the  allocation of resources to build or upgrade drilling units are
determined  by  the  activities  and  needs  of  customers.  See  Note  9.

     For  investments  in joint ventures and other entities that do not meet the
criteria  of  a  variable  interest entity and where we are not deemed to be the
primary  beneficiary  for  accounting  purposes  of those entities that meet the
variable  interest entity criteria, we use the equity method of accounting where
our  ownership  is  between 20 percent and 50 percent and where our ownership is
more  than  50  percent and we do not have significant influence or control over
the joint venture. We use the cost method of accounting for investments in joint
ventures  where  our  ownership is less than 20 percent and where we do not have
significant  influence  over the joint venture. We consolidate those investments
in  joint ventures that meet the criteria of a variable interest entity where we
are  deemed  to  be  the  primary  beneficiary  for  accounting purposes and for
entities  in which we have a majority voting interest. Intercompany transactions
and  accounts  are  eliminated.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Basis  of  Presentation - Our accompanying condensed consolidated financial
statements  have  been  prepared  without  audit  in  accordance with accounting
principles  generally  accepted  in  the  United  States  for  interim financial
information  and with the instructions to Form 10-Q and Article 10 of Regulation
S-X  of the Securities and Exchange Commission ("SEC"). Accordingly, pursuant to
such  rules  and  regulations,  these  financial  statements  do not include all
disclosures required by accounting principles generally accepted in the U.S. for
complete  financial  statements. The condensed consolidated financial statements
reflect  all adjustments, which are, in the opinion of management,


                                        5
<PAGE>
                        TRANSOCEAN INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                   (Unaudited)

necessary  for a fair statement of financial position, results of operations and
cash  flows  for the interim periods. Such adjustments are considered to be of a
normal  recurring  nature unless otherwise identified. Operating results for the
three  and  six months ended June 30, 2004 are not necessarily indicative of the
results  that  may  be expected for the year ending December 31, 2004 or for any
future  period. The accompanying condensed consolidated financial statements and
notes  thereto  should  be  read  in  conjunction  with the audited consolidated
financial  statements  and  notes  thereto included in our Annual Report on Form
10-K  for  the  year  ended  December  31,  2003.

     Accounting  Estimates  -  The  preparation  of  financial  statements  in
conformity  with  accounting  principles generally accepted in the U.S. requires
management to make estimates and assumptions that affect the reported amounts of
assets,  liabilities, revenues, expenses and disclosure of contingent assets and
liabilities.  On  an  ongoing  basis, we evaluate our estimates, including those
related  to  bad  debts,  materials  and  supplies  obsolescence,  investments,
intangible  assets  and  goodwill,  property  and equipment and other long-lived
assets,  income  taxes,  workers'  insurance,  pensions and other postretirement
benefits,  other  employment  benefits  and  contingent liabilities. We base our
estimates  on  historical experience and on various other assumptions we believe
are  reasonable under the circumstances, the results of which form the basis for
making  judgments  about  the carrying values of assets and liabilities that are
not  readily  apparent from other sources. Actual results could differ from such
estimates.

     Supplementary Cash Flow Information - Cash payments for interest and income
taxes,  net,  were  $103.5  million and $35.9 million, respectively, for the six
months  ended  June 30, 2004 and $106.1 million and $40.9 million, respectively,
for  the  six  months  ended  June  30,  2003.

     Goodwill  -  In  accordance with the Financial Accounting Standards Board's
("FASB")  Statement of Financial Accounting Standards ("SFAS") 142, Goodwill and
Other  Intangible  Assets,  goodwill  is  no  longer amortized and is tested for
impairment at the reporting unit level, which is defined as an operating segment
or  a  component  of  an operating segment that constitutes a business for which
financial  information  is  available  and  is regularly reviewed by management.
Management has determined that our reporting units are the same as our operating
segments  for  the  purpose of allocating goodwill and the subsequent testing of
goodwill  for  impairment.  Goodwill  resulting  from  the R&B Falcon merger was
allocated  to our two reporting units, Transocean Drilling and TODCO, at a ratio
of  68 percent and 32 percent, respectively. The allocation was determined based
on  the  percentage  of  each reporting unit's assets at fair value to the total
fair  value  of  assets  acquired  in  the R&B Falcon merger. The fair value was
determined  from  a  third  party  valuation.  Goodwill  resulting from previous
mergers  was  allocated entirely to the Transocean Drilling reporting unit.  The
remaining goodwill balance at June 30, 2004 and December 31, 2003 relates to our
Transocean  Drilling  segment.

     Impairment  of Long-Lived Assets - The carrying value of long-lived assets,
principally  property  and  equipment, is reviewed for potential impairment when
events  or  changes  in  circumstances indicate that the carrying amount of such
assets  may  not  be  recoverable.  For property and equipment held for use, the
determination  of  recoverability  is made based upon the estimated undiscounted
future  net  cash flows of the related asset or group of assets being evaluated.
Property and equipment held for sale are recorded at the lower of net book value
or  fair  value.  See  Note  4.

     Income  Taxes - Income taxes have been provided based upon the tax laws and
rates  in  the countries in which operations are conducted and income is earned.
The  income  tax  rates  imposed by these taxing authorities vary substantially.
Taxable income may differ from pre-tax income for financial accounting purposes,
particularly  in  countries  with  revenue-based  taxes.  There  is  no expected
relationship  between  the  provision  for income taxes and income before income
taxes  because the countries in which we operate have different taxation regimes
that  vary  not  only  with  respect  to  nominal  rate but also in terms of the
availability  of  deductions,  credits and other benefits. Variations also arise
because  income  earned  and  taxed  in  any particular country or countries may
fluctuate  from  period  to  period.  Deferred  tax  assets  and liabilities are
recognized  for  the  anticipated  future  tax  effects of temporary differences
between  the  financial  statement  basis  and  the  tax basis of our assets and
liabilities  using the applicable tax


                                        6
<PAGE>
                        TRANSOCEAN INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                   (Unaudited)

rates  in effect at period end. A valuation allowance for deferred tax assets is
recorded  when  it  is more likely than not that some or all of the benefit from
the  deferred  tax  asset  will  not  be  realized.  See  Note  5.

     Comprehensive  Income  -  The components of accumulated other comprehensive
loss  at  June  30,  2004  and December 31, 2003, net of tax, are as follows (in
millions):

<TABLE>
<CAPTION>
                                                                      Unrealized
                                                        Gain on        Loss on                    Accumulated
                                                      Terminated      Available-     Minimum         Other
                                                     Interest Rate     for-Sale      Pension     Comprehensive
                                                         Swap         Securities    Liability        Loss
                                                    ---------------  ------------  -----------  ---------------
<S>                                                 <C>              <C>           <C>          <C>

Balance at December 31, 2003                        $          3.4   $      (0.4)  $    (23.2)  $        (20.2)
  Change in other comprehensive income, net of tax            (0.2)         (0.1)         0.5              0.2
                                                    ---------------  ------------  -----------  ---------------
Balance at June 30, 2004                            $          3.2   $      (0.5)  $    (22.7)  $        (20.0)
                                                    ===============  ============  ===========  ===============
</TABLE>

     Stock-Based Compensation - Through December 31, 2002 and in accordance with
the  provisions  of  SFAS  123,  Accounting for Stock-Based Compensation, we had
elected to follow Accounting Principles Board Opinion ("APB") 25, Accounting for
Stock  Issued  to  Employees,  and related interpretations in accounting for our
employee stock-based compensation plans. Stock-based compensation awards granted
prior  to  January  1,  2003,  if not subsequently modified, will continue to be
accounted  for  under  the  recognition  and  measurement  provisions of APB 25.
Effective  January  1, 2003, we adopted the fair value recognition provisions of
SFAS  123  using  the  prospective method proscribed in SFAS 148, Accounting for
Stock-Based  Compensation  -  Transition  and  Disclosure. Under the prospective
method,  all  future  employee  stock-based  compensation  awards  granted on or
subsequent  to January 1, 2003 are expensed over the vesting period based on the
fair  value of the underlying awards on the date of grant. The fair value of the
stock  options is determined using the Black-Scholes option pricing model, while
the  fair  value  of  restricted  stock grants is determined based on the market
price of our stock on the date of grant. Additionally, stock appreciation rights
are  recorded  at  fair  value  with the changes in fair value being recorded as
compensation  expense  as  incurred.


                                        7
<PAGE>
                        TRANSOCEAN INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                   (Unaudited)

     If  compensation  expense  for  grants  to  employees  under  our long-term
incentive  plan  and  employee  stock purchase plan prior to January 1, 2003 was
recognized  using the fair value method of accounting under SFAS 123 rather than
the intrinsic value method under APB 25, net income and earnings per share would
have  been reduced to the pro forma amounts indicated below (in millions, except
per  share  data):

<TABLE>
<CAPTION>
                                                         Three Months Ended       Six Months Ended
                                                               June 30,                June 30,
                                                      -----------------------  ------------------------
                                                           2004        2003        2004         2003
                                                      --------------  -------  ------------  ----------
<S>                                                   <C>             <C>      <C>           <C>
Net Income (Loss) as Reported                         $        48.0   $(44.5)  $      70.7   $     2.7
  Add back: Stock-based compensation expense
    included in reported net income, net of related
    tax effects                                                 1.5      1.3           8.8         2.5

Deduct: Total stock-based compensation expense
  determined under the fair value method for all
  awards, net of related tax effects
      Long-Term Incentive Plan                                 (3.2)    (3.7)        (12.9)       (8.3)
      Employee Stock Purchase Plan                             (0.5)    (1.2)         (1.1)       (2.1)

                                                      --------------  -------  ------------  ----------
Pro Forma Net Income (Loss)                           $        45.8   $(48.1)  $      65.5   $    (5.2)
                                                      ==============  =======  ============  ==========

Basic and Diluted Earnings (Loss) Per Share
  As Reported                                         $        0.15   $(0.14)  $      0.22   $    0.01
  Pro Forma                                                    0.14    (0.15)         0.20       (0.02)
</TABLE>

     New  Accounting  Pronouncements - In April 2004, the FASB issued FASB Staff
Position  ("FSP")  129-1,  Disclosure  of  Information  about Capital Structure,
Relating  to  Contingently  Convertible  Securities,  which  applies  to  all
contingently  convertible securities and became effective the date of issue. The
FSP  requires  disclosure  of  the  nature  of the contingency and the potential
impact  of  conversion  on  the financial statements, particularly the impact on
earnings  per  share,  and  whether  the  securities  have  been included in the
entity's  calculation  of diluted earnings per share. The implementation of this
FSP  did  not  have an effect on our condensed consolidated financial statements
and  related  notes  thereto  as  our  disclosures  are  in  accordance with the
disclosure  requirements  as  stated  in  this  FSP.

     Reclassifications  -  Certain  reclassifications  have  been  made to prior
period  amounts  to  conform  with  the  current  period's  presentation.

NOTE 3 - TODCO INITIAL PUBLIC OFFERING

     In February 2004, we completed the TODCO IPO, in which we sold 13.8 million
shares of TODCO's class A common stock, representing approximately 23 percent of
TODCO's  total outstanding shares, at $12.00 per share. We received net proceeds
of  $155.7  million  from  the  IPO and recognized a gain of approximately $39.4
million  ($0.12  per  diluted  share)  in  the  first  quarter  of  2004,  which
represented  the  excess of net proceeds received over the net book value of the
TODCO  shares  sold  in  the  IPO. We hold an approximate 77 percent interest in
TODCO,  represented  by 46.2 million shares of class B common stock, and we have
approximately 94 percent of the outstanding voting interest in TODCO. Each share
of  our  class  B common stock has five votes per share compared to one vote per
share  of class A common stock. We consolidate TODCO in our financial statements
as  a  business  segment.

     We  entered  into various agreements with TODCO to set forth our respective
rights  and  obligations relating to our businesses and to effect the separation
of  our  two companies. These agreements included a master separation agreement,
tax sharing agreement, employee matters agreement, transition services agreement
and  registration  rights  agreement.


                                        8
<PAGE>
                        TRANSOCEAN INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                   (Unaudited)


     As  a  result  of  the  deconsolidation  of  TODCO  from  our  other  U.S.
subsidiaries  for  U.S. federal income tax purposes in conjunction with the IPO,
we  established  in  the first quarter of 2004 an initial valuation allowance of
approximately  $31.0  million  ($0.09  per  diluted share) against the estimated
deferred  tax  assets of TODCO in excess of its deferred tax liabilities, taking
into  account  prudent and feasible planning strategies as required by SFAS 109,
Accounting  for  Income  Taxes.  The ultimate amount of such valuation allowance
could vary significantly depending upon a number of factors, including the final
allocation  of  tax  benefits  between  TODCO  and  our other subsidiaries under
applicable  law,  taxable  income  for  calendar  year  2004  and our ability to
implement  planning  strategies  under  SFAS  109.  See  Note  5.

     In  conjunction with the closing of the TODCO IPO, TODCO granted restricted
stock  and  stock  options  to  certain  of  its  employees  under its long-term
incentive  plan  and  certain  of  these  awards vested at the time of grant. In
accordance  with  the  provisions  of  SFAS  123,  TODCO  expects  to  recognize
compensation  expense of approximately $17.0 million over the vesting periods of
the  awards. TODCO recognized approximately $6.0 million ($0.02 per Transocean's
diluted share) in the first quarter of 2004 as a result of the immediate vesting
of  certain  awards.  TODCO  will amortize the remaining amount of approximately
$11.0  million  to  compensation  expense  over  the  next  three  years  with
approximately  $5.0  million  over  the remainder of 2004 and approximately $5.0
million and $1.0 million in 2005 and 2006, respectively. In addition, certain of
TODCO's employees held options that were granted prior to the IPO to acquire our
ordinary  shares.  In  accordance  with  the  employee  matters agreement, these
options were modified at the IPO date, which resulted in the accelerated vesting
of the options and the extension of the term of the options through the original
contractual  life.  TODCO  recognized  approximately  $1.5  million  additional
compensation  expense  in  the  first  quarter  of  2004  as  a  result  of  the
modification.

NOTE 4 - ASSET DISPOSITIONS, RETIREMENTS AND IMPAIRMENTS

     Asset  Dispositions  and  Retirements  -  In  June  2004, in our Transocean
Drilling segment, we completed the sale of a semisubmersible rig, the Sedco 602,
for  net proceeds of $28.0 million and recognized a gain of $21.6 million ($0.07
per  diluted  share).

     During  the six months ended June 30, 2004, we settled insurance claims and
sold  marine  support  vessels  and  certain  other  assets  for net proceeds of
approximately  $14.0  million. We recorded net gains of $1.0 million, net of tax
of  $0.4 million, in our Transocean Drilling segment and $4.6 million ($0.01 per
diluted  share),  which  had  no tax effect, in our TODCO segment.

     In  January 2003, in our Transocean Drilling segment, we completed the sale
of a jackup rig, the RBF 160, for net proceeds of $13.1 million and recognized a
gain  of $0.2 million, net of tax of $0.1 million. The proceeds were received in
December  2002.

     During  the  six  months ended June 30, 2003, we settled an insurance claim
and sold certain other assets for net proceeds of approximately $3.2 million. We
recorded  net  gains of $1.3 million, which had no tax effect, in our Transocean
Drilling  segment  and  $0.3  million,  net of tax of $0.1 million, in our TODCO
segment.

     Impairments  -  During  the  six  months  ended  June 30, 2003, we recorded
after-tax  non-cash impairment charges of $5.2 million ($0.02 per diluted share)
in  our Transocean Drilling segment associated with the removal of two rigs from
drilling service and the value assigned to leases on oil and gas properties that
we intended to discontinue.  The determination of fair market value was based on
an  offer  from a potential buyer, in the case of the two rigs, and management's
assessment  of  fair value, in the case of the leases on oil and gas properties,
where  third  party  valuations  were  not  available.

     During  the  six  months  ended June 30, 2003, we recorded pre-tax non-cash
impairment  charges  of $11.6 million ($7.6 million, or $0.02 per diluted share,
after-tax)  in our TODCO segment associated with the removal of five


                                        9
<PAGE>
                        TRANSOCEAN INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                   (Unaudited)


jackup  rigs  from  drilling  service  and  the  write  down  in the value of an
investment  in  a  joint venture to fair value. The determination of fair market
value  was  based on third party valuations, in the case of the jackup rigs, and
management's  assessment of fair value, in the case of the investment in a joint
venture,  where  third  party  valuations  were  not  available.

NOTE 5 - INCOME TAXES

     The  annual effective tax rate for 2004 is estimated to be approximately 35
percent of earnings before TODCO IPO-related items, loss on debt retirements and
gains  on  significant  asset  sales.  The  effective  tax  rate  increased from
approximately 27 percent estimated at March 31, 2004 as a result of developments
in  the second quarter on certain international tax disputes, an increase in the
valuation  allowance established at the time of the TODCO IPO and changes in the
expected  amount  and geographical concentration of taxable income. The catch-up
effect of the increase in the annual effective tax rate, a reduction in earnings
of  $4.6  million ($0.01 per diluted share), was reflected in the second quarter
of  2004  resulting  in  an effective tax rate of 45 percent on earnings for the
three  months ended June 30, 2004, excluding the sale of the semisubmersible rig
Sedco  602.

     During the quarter ended March 31, 2004 and in conjunction with the IPO, we
established  a  valuation  allowance  of  approximately $31.0 million ($0.09 per
diluted  share)  against  the  deferred  tax  assets  of  TODCO in excess of its
deferred  tax  liabilities.  See  Note  3.

     At June 30, 2003, we estimated the annual effective tax rate for 2003 to be
approximately  38  percent of earnings before non-cash note receivable and other
asset  impairments  and  loss  on  debt  retirements. The rate increased from an
estimated  annual  effective  tax  rate of approximately 20 percent at March 31,
2003  due  to a change in the amount and mix of estimated earnings for the year.
As  a  result  of  the catch-up effect of the change in the annual effective tax
rate,  earnings  for  the three months ended June 30, 2003 were reduced by $10.7
million  ($0.03  per  diluted  share).

     In June 2003, we recorded a $14.6 million ($0.04 per diluted share) foreign
tax  benefit  attributable  to the favorable resolution of a non-U.S. income tax
liability.


                                       10
<PAGE>
                        TRANSOCEAN INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                   (Unaudited)


NOTE 6 - DEBT

     Debt, net of unamortized discounts, premiums and fair value adjustments, is
comprised  of  the  following  (in  millions):

<TABLE>
<CAPTION>
                                                                             June 30,   December 31,
                                                                               2004         2003
                                                                             ---------  -------------
<S>                                                                          <C>        <C>

6.75% Senior Notes, due April 2005                                           $   356.9  $       361.2
7.31% Nautilus Class A1 Amortizing Notes - final maturity May 2005                42.0           63.6
6.95% Senior Notes, due April 2008                                               267.4          269.5
9.5% Senior Notes, due December 2008                                              11.3          357.3
800 Million Revolving Credit Agreement - final maturity December 2008             50.0          250.0
6.625% Notes, due April 2011                                                     791.6          797.3
7.375% Senior Notes, due April 2018                                              250.4          250.4
Zero Coupon Convertible Debentures, due May 2020 (put options exercisable
  May 2008 and May 2013)                                                          16.8           16.5
1.5% Convertible Debentures, due May 2021 (put options exercisable May
  2006, May 2011 and May 2016)                                                   400.0          400.0
8% Debentures, due April 2027                                                    198.1          198.1
7.45% Notes, due April 2027 (put options exercisable April 2007)                  94.9           94.8
7.5% Notes, due April 2031                                                       597.5          597.5
Other                                                                                -            1.9
                                                                             ---------  -------------
Total Debt                                                                     3,076.9        3,658.1
Less Debt Due Within One Year                                                    398.9           45.8
                                                                             ---------  -------------
  Total Long-Term Debt                                                       $ 2,678.0  $     3,612.3
                                                                             =========  =============
</TABLE>

     The  scheduled maturity of our debt, at face value, assumes the bondholders
exercise  their  options  to  require  us  to  repurchase  the  1.5% Convertible
Debentures,  7.45%  Notes  and  Zero  Coupon Convertible Debentures in May 2006,
April  2007  and  May  2008,  respectively,  and  is  as  follows (in millions):

<TABLE>
<CAPTION>
                                  Twelve Months
                                      Ending
                                     June 30,
                                  --------------
<S>                               <C>

           2005                   $        392.3
           2006                            400.0
           2007                            100.0
           2008                            269.0
           2009                             60.2
           Thereafter                    1,750.0
                                  --------------
              Total               $      2,971.5
                                  ==============
</TABLE>

     Commercial  Paper Program - We have a revolving credit agreement, described
below,  which,  together  with  previous  revolving  credit agreements, provided
liquidity  for  commercial  paper borrowings during 2003. Because we believe our
current cash balances and the revolving credit agreement described below provide
us  with  adequate  liquidity, we terminated our Commercial Paper Program during
the  first  quarter  of  2004.

     Revolving  Credit  Agreements - We are party to an $800.0 million five-year
revolving credit agreement (the "Revolving Credit Agreement") dated December 16,
2003.  The  Revolving  Credit Agreement bears interest, at our option, at a base
rate or London Interbank Offered Rate ("LIBOR") plus a margin that can vary from
0.35  percent  to


                                       11
<PAGE>
                        TRANSOCEAN INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                   (Unaudited)

0.95  percent  depending on our non-credit enhanced senior unsecured public debt
rating.  At June 30, 2004, the applicable margin was 0.5 percent. A facility fee
varying from 0.075 percent to 0.225 percent depending on our non-credit enhanced
senior  unsecured  public  debt  rating,  is incurred on the daily amount of the
underlying  commitment,  whether  used  or  unused,  throughout  the term of the
facility.  At  June  30,  2004, the applicable facility fee was 0.125 percent. A
utilization  fee  of  0.125  percent is payable if amounts outstanding under the
Revolving  Credit  Agreement  are greater than $264.0 million. At June 30, 2004,
$50.0  million  was  outstanding  under  the  Revolving  Credit  Agreement.

     The  Revolving  Credit Agreement requires compliance with various covenants
and  provisions  customary  for agreements of this nature, including an earnings
before  interest,  taxes,  depreciation  and amortization ("EBITDA") to interest
coverage  ratio,  as  defined by the credit agreement, of not less than three to
one, a debt to total tangible capital ratio, as defined by the credit agreement,
of  not  greater  than  50 percent, and limitations on creating liens, incurring
debt,  transactions with affiliates, sale/leaseback transactions and mergers and
sale  of  substantially  all  assets.

     In  December  2003,  TODCO  entered into a $75.0 million two-year revolving
credit  agreement (the "TODCO Revolving Credit Agreement"), which will reduce to
$60.0  million  in  December  2004.  The  TODCO Revolving Credit Agreement bears
interest,  at  TODCO's  option,  at a base rate plus a margin of 2.50 percent or
LIBOR  plus a margin of 3.50 percent.  Utilization of the facility is limited by
a  borrowing  base.  Commitment  fees  on the unused portion of the facility are
1.50  percent  of  the average daily balance and are payable quarterly.  At June
30,  2004,  there were no borrowings under the TODCO Revolving Credit Agreement.
The  TODCO Revolving Credit Agreement requires compliance with various covenants
and  provisions  customary  for  similar  agreements  of  non-investment  grade
facilities.  TODCO's  Revolving  Credit  Agreement  is  not  guaranteed  by  us.

     Debt  Redeemed,  Retired  and Repurchased - In March 2004, we completed the
redemption  of our $289.8 million principal amount outstanding 9.5% Senior Notes
due  December 2008 at the make-whole premium price provided in the indenture. We
redeemed  these  notes at 127.796% of face value or $370.3 million, plus accrued
and  unpaid  interest. We recognized an after-tax loss on the redemption of debt
of approximately $28.1 million ($0.09 per diluted share) in the first quarter of
2004,  which  reflected adjustments for fair value of the debt at the R&B Falcon
merger  and the premium on the termination of the related interest rate swap. We
funded  the redemption with existing cash balances, which included proceeds from
the TODCO IPO.  The redemption did not affect the 9.5% Senior Notes due December
2008  of  TODCO,  which  had  an aggregate principal amount outstanding of $10.2
million  at  June  30,  2004.

     In  May 2003, we repurchased and retired all of the $50.0 million principal
amount  outstanding  9.41%  Nautilus  Class A2 Notes due May 2005 and funded the
repurchase  from  existing  cash balances. We recognized a loss on retirement of
debt of approximately $3.6 million ($0.01 per diluted share), net of tax of $1.9
million,  in  the  second  quarter  of  2003.

     In  May 2003, holders of our Zero Coupon Convertible Debentures due May 24,
2020  had  the  option  to require us to repurchase their debentures. Holders of
$838.6 million aggregate principal amount, or approximately 97 percent, of these
debentures  exercised  this  option,  and  we  repurchased their debentures at a
repurchase  price of $628.57 per $1,000 principal amount. Under the terms of the
debentures,  we had the option to pay for the debentures with cash, our ordinary
shares  or  a  combination  of cash and shares, and we elected to pay the $527.2
million  repurchase  price from existing cash balances. We recognized additional
expense of approximately $10.2 million ($0.03 per diluted share) as an after-tax
loss  on  retirement of debt in the second quarter of 2003 to fully amortize the
remaining  debt  issue  costs  related  to  the  repurchased  debentures.

     In  April  2003,  we  repaid  the  entire  $239.5  million principal amount
outstanding  6.5%  Senior  Notes,  of  which  $5.0  million  principal  amount
outstanding  was  the  obligation of TODCO, plus accrued and unpaid interest, in
accordance  with their scheduled maturity. We funded the repayment from existing
cash  balances.


                                       12
<PAGE>
                        TRANSOCEAN INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                   (Unaudited)

NOTE 7 - FINANCIAL INSTRUMENTS AND RISK CONCENTRATION

     Foreign  Exchange  Risk - Our international operations expose us to foreign
exchange  risk.  This  risk  is  primarily  associated  with  compensation costs
denominated  in  currencies  other  than the U.S. dollar and with purchases from
foreign  suppliers.  We  may use a variety of techniques to minimize exposure to
foreign  exchange  risk,  including  customer contract payment terms and foreign
exchange  derivative  instruments.

     Our  primary foreign exchange risk management strategy involves structuring
customer  contracts  to  provide  for  payment  in  both  U.S. dollars and local
currency.  The  payment  portion  denominated  in  local  currency  is  based on
anticipated  local  currency requirements over the contract term. Due to various
factors,  including  local  banking  laws,  other  statutory requirements, local
currency  convertibility  and  the  impact  of  inflation on local costs, actual
foreign  exchange  needs  may  vary  from  those  anticipated  in  the  customer
contracts,  resulting in partial exposure to foreign exchange risk. Fluctuations
in  foreign  currencies  typically  have  not  had  a material impact on overall
results.  In  situations  where  payments  of  local currency do not equal local
currency  requirements,  foreign  exchange  derivative instruments, specifically
foreign  exchange  forward  contracts, or spot purchases may be used to mitigate
foreign  currency  risk.  A  foreign  exchange  forward contract obligates us to
exchange  predetermined  amounts  of  specified  foreign currencies at specified
exchange  rates  on specified dates or to make an equivalent U.S. dollar payment
equal  to  the  value  of  such  exchange.

     In January 2003, Venezuela implemented foreign exchange controls that limit
the  Company's  ability to convert local currency into U.S. dollars and transfer
excess  funds  out  of  Venezuela. The Company's drilling contracts in Venezuela
typically  call for payments to be made in local currency, even when the dayrate
is  denominated  in  U.S. dollars. The exchange controls could also result in an
artificially  high  value  being  placed on the local currency. As a result, the
Company  recognized  a  loss of $1.5 million, net of tax of $0.8 million, on the
revaluation of the local currency into functional U.S dollars for the six months
ended  June  30,  2003.

     We  do  not enter into derivative transactions for speculative purposes. At
June  30,  2004,  we  had  no  open  foreign  exchange  derivative  contracts.

NOTE 8 - INTEREST RATE SWAPS

     In January 2003, we terminated swaps with respect to our 6.75% Senior Notes
due  April  2005,  6.95%  Senior  Notes due April 2008 and 9.5% Senior Notes due
December  2008.  In  March  2003, we terminated swaps with respect to our 6.625%
Notes.  As  a  result  of  these terminations, we received cash proceeds, net of
accrued  interest, of approximately $173.5 million that was recognized as a fair
value  adjustment  to  long-term  debt in our consolidated balance sheet and the
fair value adjustment is being amortized as a reduction to interest expense over
the  life  of the underlying debt. During the six months ended June 30, 2004 and
2003,  such reduction amounted to $12.4 million (or $0.04 per diluted share) and
$10.0  million  (or  $0.03  per diluted share), respectively. As a result of the
redemption  of our 9.5% Senior Notes in March 2004, we recognized a swap premium
of  $22.0  million  on  the  termination  of the related interest rate swap as a
reduction  to  our  loss  on  retirement  of  debt  (see  Note  6).

     At June 30, 2004 and December 31, 2003, we had no outstanding interest rate
swaps.

NOTE 9 - SEGMENTS

     Our  operations are aggregated into two reportable segments: (i) Transocean
Drilling  and  (ii) TODCO. The Transocean Drilling segment consists of floaters,
jackups  and  other  rigs  used  in  support of offshore drilling activities and
offshore  support services. The TODCO segment consists of our interest in TODCO,
which  conducts  jackup,  drilling  barge,  land  rig,  submersible  and  other
operations  located  in  the  U.S.  Gulf  of  Mexico  and inland waters, Mexico,
Trinidad  and  Venezuela.  We  provide services with different types of drilling
equipment  in  several  geographic  regions.  The  location  of our rigs and the
allocation of resources to build or upgrade rigs is determined by the activities


                                       13
<PAGE>
                        TRANSOCEAN INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                   (Unaudited)

and  needs  of  customers.  Accounting  policies of the segments are the same as
those  described  in Note 2. We account for intersegment revenue and expenses as
if  the  revenue  or  expenses  were  to third parties at current market prices.

     Operating  revenues  and  income  (loss)  before  income taxes and minority
interest  by  segment  were  as  follows  (in  millions):

<TABLE>
<CAPTION>
                                                       Three Months Ended June 30,       Six Months Ended June 30,
                                                   ---------------------------------  ------------------------------
                                                         2004             2003            2004            2003
                                                   ----------------  ---------------  ------------  ----------------
<S>                                                <C>               <C>              <C>           <C>

Operating Revenues
  Transocean Drilling                              $         552.5   $        548.5   $   1,130.7   $       1,111.2
  TODCO                                                       80.7             55.4         154.5             108.7
                                                   ----------------  ---------------  ------------  ----------------
    Total Operating Revenues                       $         633.2   $        603.9   $   1,285.2   $       1,219.9
                                                   ----------------  ---------------  ------------  ----------------

Operating Income (Loss) Before General and
    Administrative Expense
  Transocean Drilling (a)                          $         127.2   $         84.2   $     305.4   $         228.2
  TODCO (b)                                                   (9.4)           (49.5)        (36.3)            (78.0)
                                                   ----------------  ---------------  ------------  ----------------
                                                             117.8             34.7         269.1             150.2
Unallocated general and administrative expense               (14.0)           (14.9)        (29.1)            (28.8)
Unallocated other expense, net                               (38.1)           (84.9)       (107.8)           (127.6)
                                                   ----------------  ---------------  ------------  ----------------
  Income (Loss) Before Income Taxes and Minority
    Interest                                       $          65.7   $        (65.1)  $     132.2   $          (6.2)
                                                   ================  ===============  ============  ================
<FN>
______________
(a)  The  six  months  ended  June 30, 2004 includes a $39.4 million gain from the TODCO  initial  public  offering.
(b)  The three and six months ended June 30, 2004 include $7.1 million and $19.4 million, respectively, of operating
     and  maintenance expense that TODCO classifies  as general and administrative expense. The three and six months
     ended June 30, 2003 include $3.6 million and $7.3 million, respectively, of operating and  maintenance  expense
     that  TODCO classifies as general and administrative  expense.
</TABLE>

<TABLE>
<CAPTION>
     Depreciation expense by segment was as follows (in millions):

                                  Three Months Ended June 30,      Six Months Ended June 30,
                                ------------------------------  -----------------------------
                                    2004            2003             2004           2003
                                -------------  ---------------  --------------  -------------
<S>                             <C>            <C>              <C>             <C>

Transocean Drilling             $       109.1  $         104.4  $        216.4  $       208.0
TODCO                                    23.9             23.1            48.1           46.3
                                -------------  ---------------  --------------  -------------
    Total Depreciation Expense  $       133.0  $         127.5  $        264.5  $       254.3
                                =============  ===============  ==============  =============
</TABLE>

<TABLE>
<CAPTION>
     Total assets by segment were as follows (in millions):

                                                               June 30,   December 31,
                                                                 2004         2003
                                                               ---------  -------------
<S>                                                            <C>        <C>

Transocean Drilling                                            $10,589.3  $    10,874.0
TODCO                                                              746.4          788.6
                                                               ---------  -------------
    Total Assets                                               $11,335.7  $    11,662.6
                                                               =========  =============
</TABLE>


                                       14
<PAGE>
                        TRANSOCEAN INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                   (Unaudited)

     Total capital expenditures by segment were as follows (in millions):

<TABLE>
<CAPTION>
                                  Three Months Ended June 30,     Six Months Ended June 30,
                                -------------------------------  -----------------------------
                                      2004            2003            2004           2003
                                ----------------  -------------  --------------  -------------
<S>                             <C>               <C>            <C>             <C>

Transocean Drilling             $           35.5  $        24.3  $         51.0  $        47.1
TODCO                                        1.8            1.5             4.8            3.1
                                ----------------  -------------  --------------  -------------
    Total Capital Expenditures  $           37.3  $        25.8  $         55.8  $        50.2
                                ================  =============  ==============  =============
</TABLE>

NOTE 10 - EARNINGS PER SHARE

     The  reconciliation  of  the  numerator  and  denominator  used  for  the
computation  of  basic  and  diluted earnings (loss) per share is as follows (in
millions,  except  per  share  data):

<TABLE>
<CAPTION>
                                                         Three Months Ended June 30,     Six Months Ended June 30,
                                                       -------------------------------  -----------------------------
                                                           2004             2003             2004           2003
                                                       -------------  ----------------  --------------  -------------

<S>                                                    <C>            <C>               <C>             <C>
NUMERATOR FOR BASIC AND DILUTED EARNINGS (LOSS)
  PER SHARE
Net Income (Loss) for Basic and Diluted Earnings per
  Share                                                $        48.0  $         (44.5)  $         70.7  $         2.7
                                                       =============  ================  ==============  =============

DENOMINATOR FOR DILUTED EARNINGS (LOSS) PER SHARE
Weighted-average shares outstanding for basic
  earnings per share                                           320.8            319.8            320.7          319.7
  Effect of dilutive securities:
  Employee stock options and unvested stock grants               2.0                -              2.1            1.2
  Warrants to purchase ordinary shares                           1.3                -              1.4            0.6
                                                       -------------  ----------------  --------------  -------------
Adjusted weighted-average shares and assumed
  conversions for diluted earnings per share                   324.1            319.8            324.2          321.5
                                                       =============  ================  ==============  =============

BASIC AND DILUTED EARNINGS (LOSS) PER SHARE
  Net Income (Loss)                                    $        0.15  $         (0.14)  $         0.22  $        0.01
                                                       =============  ================  ==============  =============
</TABLE>

     Ordinary  shares subject to issuance pursuant to the conversion features of
the  convertible  debentures  are  not  included  in the calculation of adjusted
weighted-average  shares  and assumed conversions for diluted earnings per share
because  the  effect  of including those shares is anti-dilutive for all periods
presented.  Ordinary  shares  subject  to  issuance  pursuant  to the conversion
features  of  the  contingently  convertible  debentures are not included in the
calculation  of  adjusted  weighted-average  shares  and assumed conversions for
diluted  earnings  per  share  because  the  conversion  features  have not been
triggered  for  all  periods  presented.  Incremental  shares  related  to stock
options,  unvested stock grants and warrants are not included in the calculation
of adjusted weighted-average shares and assumed conversions for diluted earnings
per  share  for  the  three  months  ended  June 30, 2003, because the effect of
including  those  shares  is  anti-dilutive  for  that  period.

NOTE 11 - CONTINGENCIES

     Legal  Proceedings  - In 1990 and 1991, two of our subsidiaries were served
with  various assessments collectively valued at approximately $5.8 million from
the  municipality  of  Rio  de  Janeiro,  Brazil  to  collect a municipal tax on
services.  We  believe  that neither subsidiary is liable for the taxes and have
contested  the assessments in the Brazilian administrative and court systems. In
October  2001,  the Brazil Supreme Court rejected our appeal of an adverse lower
court's  ruling  with  respect  to  a  June  1991 assessment, which is valued at
approximately $5 million. We are continuing to challenge the assessment and have
an  action  to  suspend a related tax foreclosure proceeding. We have received a
favorable  ruling  in  connection with a disputed August 1990 assessment but the
government  has  appealed  that  ruling.  We also are awaiting a ruling from the
Taxpayer's  Council  in  connection  with  an  October  1990  assessment. If our
defenses  are  ultimately  unsuccessful,  we  believe  that  the  Brazilian
government-controlled  oil  company,  Petrobras, has a contractual obligation to
reimburse  us  for municipal tax payments required to be paid by them. We do not
expect  the  liability,  if  any,  resulting  from  these  assessments to have a
material  adverse  effect  on  our  business or consolidated financial position.


                                       15
<PAGE>
                        TRANSOCEAN INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                   (Unaudited)

     The  Indian Customs Department, Mumbai, filed a "show cause notice" against
one  of  our subsidiaries and various third parties in July 1999. The show cause
notice  alleged  that  the initial entry into India in 1988 and other subsequent
movements  of  the  Trident II jackup rig operated by the subsidiary constituted
imports  and  exports  for which proper customs procedures were not followed and
sought  payment  of  customs  duties  of  approximately  $31 million based on an
alleged  1998  rig  value  of  $49  million,  with  interest  and penalties, and
confiscation  of  the  rig.  In  January 2000, the Customs Department issued its
order,  which  found  that  we had imported the rig improperly and intentionally
concealed  the  import from the authorities, and directed us to pay a redemption
fee  of  approximately $3 million for the rig in lieu of confiscation and to pay
penalties  of  approximately  $1  million  in  addition to the amount of customs
duties  owed.  In February 2000, we filed an appeal with the Customs, Excise and
Gold (Control) Appellate Tribunal ("CEGAT") together with an application to have
the  confiscation  of the rig stayed pending the outcome of the appeal. In March
2000,  the  CEGAT ruled on the stay application, directing that the confiscation
be  stayed  pending  the  appeal.  The CEGAT issued its opinion on our appeal on
February  2,  2001, and while it found that the rig was imported in 1988 without
proper documentation or payment of duties, the redemption fee and penalties were
reduced  to  less  than  $0.1  million  in view of the ambiguity surrounding the
import  practice  at the time and the lack of intentional concealment by us. The
CEGAT  further sustained our position regarding the value of the rig at the time
of import as $13 million and ruled that subsequent movements of the rig were not
liable  to  import documentation or duties in view of the prevailing practice of
the  Customs  Department,  thus  limiting  our  exposure  as to custom duties to
approximately  $6  million.  Following  the  CEGAT order, we tendered payment of
redemption,  penalty  and  duty  in  the amount specified by the order by offset
against  a  $0.6  million deposit and $10.7 million guarantee previously made by
us.  The Customs Department attempted to draw the entire guarantee, alleging the
actual  duty  payable is approximately $22 million based on an interpretation of
the  CEGAT  order  that  we  believe is incorrect. This action was stopped by an
interim  ruling  of  the High Court, Mumbai on writ petition filed by us. We and
the  Customs  Department  both  filed  appeals  with  the Supreme Court of India
against  the order of the CEGAT, and both appeals have been admitted. We are now
awaiting  a  hearing date. We and our customer agreed to pursue and obtained the
issuance  of  documentation  from the Ministry of Petroleum that, if accepted by
the  Customs  Department,  would  reduce the duty to nil. The agreement with the
customer  further provided that if this reduction was not obtained by the end of
2001, our customer would pay the duty up to a limit of $7.7 million. The Customs
Department  did  not  accept  the  documentation  or  agree to refund the duties
already  paid.  We  are pursuing our remedies against the Customs Department and
our  customer.  We  do not expect, in any event, that the ultimate liability, if
any,  resulting  from  the  matter  will  have  a material adverse effect on our
business  or  consolidated  financial  position.

     In  October  2001,  TODCO was notified by the U.S. Environmental Protection
Agency  ("EPA")  that  the  EPA  had  identified  a  subsidiary as a potentially
responsible  party  in  connection  with  the  Palmer  Barge Line superfund site
located  in  Port  Arthur,  Jefferson  County, Texas. Based upon the information
provided  by  the  EPA  and  a review of TODCO's internal records to date, TODCO
disputes  its  designation  as  a potentially responsible party. Pursuant to the
master  separation  agreement  with TODCO, we are responsible and will indemnify
TODCO  for  any  losses  TODCO  incurs in connection with this action. We do not
expect  that  the  ultimate  outcome  of  this case will have a material adverse
effect  on  our  business  or  consolidated  financial  position.

     In August 2003, a judgment of approximately $9.5 million was entered by the
Labor  Division of the Provincial Court of Luanda, Angola, against us and one of
our labor contractors, Hull Blyth, in favor of certain former workers on several
of our drilling rigs. The workers were employed by Hull Blyth to work on several
drilling rigs while the rigs were located in Angola. When the drilling contracts
concluded  and  the rigs left Angola, the workers' employment ended. The workers
brought  suit  claiming  that  they  were  not  properly  compensated when their
employment  ended.  In  addition  to  the  monetary judgment, the Labor Division
ordered  the workers to be hired by us. We believe that this judgment is without
sufficient  legal  foundation and have appealed the matter to the Angola Supreme
Court.  We  further believe that Hull Blyth has an obligation to protect us from
any  judgment.  We  do not believe that the ultimate outcome of this matter will
have  a  material  adverse  effect  on  our  business  or consolidated financial
position.

     One  of  our  subsidiaries is involved in an action with respect to customs
penalties  relating  to the Sedco 710 semisubmersible drilling rig. Prior to our
merger  with  Sedco  Forex  Holdings Limited ("Sedco Forex"), this drilling rig,
which  was  working  for Petrobras in Brazil at the time, had been admitted into
the  country  on  a  temporary  basis  under authority granted to a Schlumberger
entity.  Prior  to  the merger with Sedco Forex at the end of 1999, the drilling
contract  was  moved  to an entity that would become one of our subsidiaries. In
early  2000, the drilling contract was extended for another year. On January 10,
2000,  the  temporary  import permit granted to the Schlumberger entity expired,
and  renewal  filings were not made until later that January. In April 2000, the
Brazilian  customs  authorities  cancelled  the  import permit. The Schlumberger
entity  filed an action in the Brazilian federal court of Campos for the purpose
of  extending  the temporary admission. Other proceedings were also initiated in
order  to  secure  the  transfer  of  the temporary admission to our subsidiary.
Ultimately,  the  court  permitted  the transfer to our entity but has not ruled
that  the  temporary  admission  could  be  extended  without  the  payment of a
financial  penalty. During the first quarter of 2004, the customs office renewed
its efforts to collect a penalty and issued a second assessment for this penalty
but  has now done so against our subsidiary. The assessment is for approximately
$50  million.  We  believe  that  the  amount of the assessment, even if it were
appropriate,  should  only be approximately $7.6 million and should in any event
be  assessed against the Schlumberger entity. We and Schlumberger are contesting
our  respective assessments. We have put Schlumberger on notice that we consider
any  assessment  to  be the responsibility of Schlumberger. We do not expect the
ultimate  outcome  of  this  matter  to  have  a  material adverse effect on our
business  or  consolidated  financial  position.

     We  are involved in a number of other lawsuits, all of which have arisen in
the  ordinary course of our business. We do not believe that ultimate liability,
if  any,  resulting  from any such other pending litigation will have a material
adverse  effect  on  our  business  or  consolidated  financial  position.

     Letters  of  Credit and Surety Bonds - We had letters of credit outstanding
totaling  $174.4  million  and  $186.2 million at June 30, 2004 and December 31,
2003,  respectively.  These letters of credit guarantee various contract bidding
and  performance  activities under various uncommitted lines provided by several
banks.

     As  is  customary  in  the contract drilling business, we also have various
surety  bonds  in  place  that  secure  customs  obligations  relating  to  the
importation  of  our  rigs and certain performance and other obligations. Surety
bonds  outstanding totaled $22.5 million and $169.5 million at June 30, 2004 and
December  31,  2003,  respectively.  The decrease in outstanding surety bonds is
primarily  attributable  to  the  expiration of three such bonds totaling $151.1
million  related  to  our  Brazil  operations.

NOTE 12 - SALE/LEASEBACK TRANSACTION

     We  lease the drillship M. G. Hulme, Jr. from Deep Sea Investors, L.L.C., a
special  purpose  entity  formed by several leasing companies to acquire the rig
from  one  of our subsidiaries in November 1995 in a sale/leaseback transaction.
We  are  obligated  to  pay  rent  of approximately $13 million per year through
November  2005.  At  the termination of the lease, we may purchase the rig for a
maximum  amount  of  approximately  $35.7 million. Effective September 2002, the
lease  neither  requires  that  collateral be maintained nor contains any credit
rating  triggers.

     Effective  December 31, 2003, we adopted and applied the provisions of FASB
Interpretation  ("FIN")  46,  Consolidation  of  Variable  Interest Entities, as
revised  December  31, 2003, for all variable interest entities. FIN 46 requires
the consolidation of variable interest entities in which an enterprise absorbs a
majority  of  the  entity's expected losses, receives a majority of the entity's
expected  residual  returns,  or  both, as a result of ownership, contractual or
other financial interests in the entity. Because the sale/leaseback agreement is
with  an  entity  in  which we have no direct investment, we are not entitled to
receive the financial statements of the leasing entity and the equity holders of
the leasing company will not release the financial statements or other financial
information  to  us  in  order  for  us to make the determination of whether the
entity  is  a  variable  interest  entity.  In  addition,  without the financial
statements,  we are unable to determine if we are the primary beneficiary of the
entity  and,  if so, what we would consolidate. We have no exposure to loss as a
result  of  the  sale/leaseback agreement. We currently account for the lease of
this  semisubmersible  drilling  rig  as  an  operating  lease.

NOTE 13 - RELATED PARTY TRANSACTIONS

     Delta  Towing  - TODCO owns a 25 percent interest in a joint venture, Delta
Towing  Holdings,  LLC  ("Delta  Towing"), and TODCO holds notes receivable from
Delta  Towing  with  a face amount of approximately $143.0 million, which at the
time  of  the  R&B  Falcon  merger  were  valued  at $80.0 million. Delta Towing
defaulted  on  the  notes  receivable  in  January  2003  by failing to make its
scheduled  quarterly interest payment and remained in default as a result of its
continued  failure  to  make  its  quarterly  interest  payments. As a result of
TODCO's  continued evaluation of the collectibility of the notes, TODCO recorded
an  impairment  on  the  notes  receivable  of  $13.8 million ($0.04 per diluted
share),  net  of  tax  of  $7.5  million,  in  June 2003 based on Delta Towing's
discounted  cash  flows  over  the terms of the notes, which deteriorated in the
second  quarter  of  2003 as a result of the continued decline in Delta Towing's
business  outlook. During the six months ended June 30, 2003, we earned interest
income  related  to  the  notes  receivable  and the three-year revolving credit
facility  of  $3.1  million  and  $0.2  million,  respectively.

     As  a  result  of the adoption of FIN 46 and a determination that TODCO was
the  primary  beneficiary  for  accounting  purposes  of  Delta  Towing,  TODCO
consolidated  Delta  Towing  effective  December  31,  2003  and  intercompany
transactions  and  accounts  have been eliminated, including the above described
notes  receivable.


                                       16
<PAGE>
                        TRANSOCEAN INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                   (Unaudited)

     DDII  LLC  -  In  May  2003, WestLB AG, one of the lenders in the Deepwater
Frontier  synthetic  lease  financing  facility,  assigned  its  $46.1  million
remaining  promissory  note  receivable  to  us  in  exchange  for cash of $46.1
million.  Also  in  May  2003,  but  subsequent  to the WestLB AG assignment, we
purchased  ConocoPhillips'  40  percent interest in Deepwater Drilling II L.L.C.
("DDII  LLC")  for  approximately $5.0 million. As a result of this purchase, we
consolidated  DDII  LLC  late  in  the  second  quarter of 2003. In addition, we
acquired  certain  drilling  and  other  contracts  from  ConocoPhillips  for
approximately  $9.0  million  in  cash.

NOTE 14 - RETIREMENT PLANS AND OTHER POSTEMPLOYMENT BENEFITS

     Defined  Benefit  Pension  Plans  - We have several defined benefit pension
plans,  both  funded  and  unfunded,  covering  substantially all U.S. employees
except  for  TODCO  employees.  We  also have various defined benefit plans that
cover  Norway  and  Nigeria  employees  and various current and former employees
covered  under  certain  frozen plans acquired in connection with the R&B Falcon
merger.  Net  periodic  benefit  cost  for  these  defined benefit pension plans
included  the  following  components  (in  millions):

<TABLE>
<CAPTION>
                                                Three Months Ended June 30,      Six Months Ended June 30,
                                             --------------------------------  -------------------------------
                                                  2004             2003             2004            2003
                                             --------------  ----------------  --------------  ---------------
<S>                                          <C>             <C>               <C>             <C>
COMPONENTS OF NET PERIODIC BENEFIT COST (a)
Service cost                                 $         3.9   $           4.1   $         7.8   $          8.3
Interest cost                                          4.1               4.6             8.3              9.2
Expected return on plan assets                        (4.9)             (4.9)           (9.7)            (9.8)
Amortization of transition obligation                    -               0.1             0.1              0.2
Amortization of prior service cost                     0.2               0.4             0.3              0.7
Recognized net actuarial losses                        0.7                 -             1.3              0.2
                                             --------------  ----------------  --------------  ---------------
    Benefit cost                             $         4.0   $           4.3   $         8.1   $          8.8
                                             ==============  ================  ==============  ===============
<FN>
______________
(a)  Amounts are before income tax effect.
</TABLE>

     Postretirement  Benefits  Other  Than  Pensions  - We have several unfunded
contributory  and  noncontributory  postretirement  benefit  plans  covering
substantially  all  of  our  Transocean  Drilling  segment  U.S.  employees. Net
periodic  benefit  cost  for  these  other  postretirement  plans  included  the
following  components  (in  millions):

<TABLE>
<CAPTION>
                                                Three Months Ended June 30,      Six Months Ended June 30,
                                             -------------------------------  -------------------------------
                                                  2004            2003             2004             2003
                                             --------------  ---------------  ---------------  --------------
<S>                                          <C>             <C>              <C>              <C>
COMPONENTS OF NET PERIODIC BENEFIT COST (a)
Service cost                                 $         0.2   $           0.5  $          0.5   $         1.0
Interest cost                                          0.6               0.8             1.1             1.7
Amortization of prior service cost                    (0.5)              0.1            (1.1)            0.2
Recognized net actuarial losses                        0.4               0.3             0.8             0.6
SFAS 88 settlements/curtailments                         -                 -               -            (0.6)
                                             --------------  ---------------  ---------------  --------------
    Benefit cost                             $         0.7   $           1.7  $          1.3   $         2.9
                                             ==============  ===============  ===============  ==============
<FN>
______________
(a)  Amounts are before income tax effect.
</TABLE>

     In  December  2003,  the  Medicare  Prescription  Drug,  Improvement  and
Modernization  Act of 2003 (the "Act") was signed into law. The Act introduced a
prescription  drug benefit under Medicare (Medicare Part D) as well as a federal
subsidy  to  sponsors  of  retiree  health  care  benefit  plans  that provide a
prescription  drug  benefit  that is at least actuarially equivalent to Medicare
Part  D.  The  Act  introduces  two new features to Medicare that employers must
consider  in  determining  the  effect  of  the  Act  on  their  accumulated
postretirement  benefit  obligation  (''APBO'') and net periodic post retirement
benefit  cost:  (i) a subsidy based on 28 percent of an individual beneficiary's
annual prescription drug costs between $250 and $5,000, and (ii) the opportunity
for  a  retiree  to  obtain  a  prescription  drug


                                       17
<PAGE>
                        TRANSOCEAN INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                   (Unaudited)

benefit  under  Medicare. In accordance with SFAS 106, Employers' Accounting for
Postretirement  Benefits Other Than Pensions, employers are required to consider
presently  enacted  changes  in  relevant laws in current period measurements of
postretirement  benefit  costs  and  the  APBO.  As  a  result, the APBO and net
periodic  postretirement  benefit  costs  for  future periods should reflect the
effects  of  the Act. At present, detailed regulation necessary to implement the
Act have not been issued, including those that would specify the manner in which
actuarial  equivalency  must be determined, the evidence required to demonstrate
actuarial  equivalency  and  the  documentation  requirements  necessary  to  be
entitled  to  the  subsidy.

     In  May  2004,  the  FASB staff issued FSP 106-2, Accounting and Disclosure
Requirements  Related  to  the  Medicare  Prescription  Drug,  Improvement  and
Modernization  Act  of  2003.  FSP  106-2,  which supercedes the same titled FSP
106-1,  considers  the  effect  of the two new features introduced in the Act in
determining  our  APBO and net periodic post retirement benefit cost. The effect
on  the  APBO  will  be  accounted for as an actuarial gain to be amortized into
income over the average remaining service period of plan participants. Companies
may  elect  to  defer accounting for this benefit or attempt to reflect the best
estimate of the impact of the Act on their net periodic costs currently. The FSP
is  effective  for  the  first interim or annual period beginning after June 15,
2004.  We  have  chosen  to  defer accounting for the benefit and will implement
these  requirements effective July 1, 2004 using the prospective method outlined
in  FSP  106-2.  The  adoption  of  these requirements is not expected to have a
material  impact  on our condensed consolidated financial position or results of
operations.  As a result of our election to defer the implementation of the FSP,
our  measures  of APBO and net periodic postretirement benefit costs included in
the  condensed  consolidated  financial  statements  herein  do  not reflect the
effects  of  the  Act.

NOTE 15 - SUBSEQUENT EVENTS

     Norway  Strike  -  In  July  2004,  members of the OFS, one of three unions
representing  offshore workers in Norway, called a strike on our semisubmersible
units  operating  in  the  country. OFS called the strike after it was unable to
reach  an  agreement with the Norwegian Shipowners Association, which represents
rig  owners  in  Norway.  The  rigs  immediately affected are the Polar Pioneer,
Transocean Searcher and Transocean Leader. Although not currently operating, the
semisubmersible  Transocean  Arctic  was  expected  to  commence  a  contract by
mid-August  2004  but  could now be affected by the strike. The striking workers
have  now  departed  the  rigs  and  the  crews  have  been reduced to essential
personnel  only.  We  do not believe a resolution is imminent and cannot provide
any assurance as to when the rigs will be able to go back to work. At this time,
we  cannot  estimate  the  aggregate  financial  impact  of  the  strike.

     Trident  20  Incident  -  In  July 2004, the jackup rig Trident 20 suffered
damage  resulting  from a fire in the rig's engine room while operating offshore
Turkmenistan  in  the  Caspian Sea. The cause of the fire is under investigation
and  the  rig  is expected to be idle for approximately four months. The rig has
been under a three-well contract. Pursuant to the contract, our customer has the
right  to  terminate  the contract. While the contract has been suspended by the
customer  to  allow time for rig repairs and we expect that drilling will resume
under  the  terms  of  the  original contract upon completion of the repairs, no
assurances  can be given that the contract will not be terminated. We are in the
process  of  completing  an  estimate  of  the expected costs to repair the rig.

     TODCO  Secondary  Offering  - On August 3, 2004, TODCO filed a registration
statement  with the SEC relating to an offering of up to $230 million of Class A
common  stock. We will sell our Class B common stock in the offering, which will
convert  to Class A common stock upon sale. TODCO will not sell any stock in the
offering  and will not receive any proceeds. We expect to complete this offering
when  market  conditions  warrant,  subject  to  various  factors.


                                       18
<PAGE>
ITEM  2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF  OPERATIONS

     The  following information should be read in conjunction with the unaudited
condensed  consolidated  financial  statements  included  herein  under "Item 1.
Financial  Statements" and the audited consolidated financial statements and the
notes  thereto  and  "Item  7. Management's Discussion and Analysis of Financial
Condition  and Results of Operations" included in our Annual Report on Form 10-K
for  the  year  ended  December  31,  2003.

OVERVIEW

     Transocean  Inc.  (together  with our subsidiaries and predecessors, unless
the  context requires otherwise, "Transocean," "we," "us" or "our") is a leading
international  provider  of  offshore contract drilling services for oil and gas
wells.  As  of  July  30,  2004, we owned, had partial ownership interests in or
operated  95  mobile  offshore  and barge drilling units, excluding the fleet of
TODCO  (together  with  its  subsidiaries  and  predecessors, unless the context
requires  otherwise,  "TODCO"),  a  publicly  traded  company  in which we own a
majority  interest.  As  of  this date, our fleet included 32 High-Specification
semisubmersibles  and drillships ("floaters"), 25 Other Floaters, 26 Jackup Rigs
and  12  Other  Rigs.  As of July 30, 2004, TODCO's fleet consisted of 24 jackup
rigs,  30  drilling  barges, nine land rigs, three submersible drilling rigs and
four  other  drilling  rigs.

     Our mobile offshore drilling fleet is considered one of the most modern and
versatile  fleets  in  the  world.  Our  primary  business  is to contract these
drilling  rigs, related equipment and work crews primarily on a dayrate basis to
drill  oil and gas wells. We specialize in technically demanding segments of the
offshore  drilling  business  with  a  particular  focus  on deepwater and harsh
environment  drilling  services.  We also provide additional services, including
integrated  well services and management of third party well service activities.

     Certain  key  measures  of  our  total  company  results  of operations and
financial  condition  are  as  follows:

<TABLE>
<CAPTION>
                                Three Months Ended June 30,      Six Months Ended June 30,          Three           Six
                            ---------------------------------  -------------------------------      Months         Months
                                  2004             2003             2004             2003           Change         Change
                            ----------------  ---------------  ---------------  --------------  --------------  ------------
<S>                         <C>               <C>              <C>              <C>             <C>             <C>
                                                 (In millions, except dayrates and percentages)
Average dayrate (a)         $        69,600   $       65,300   $       70,600   $      67,100   $       4,300   $      3,500
Utilization (b)                          56%              57%              56%             56%            N/A            N/A

STATEMENT OF OPERATIONS
Operating revenue           $         633.2   $        603.9   $      1,285.2   $     1,219.9   $        29.3   $       65.3
Operating and maintenance
  expense                             406.2            426.5            818.6           800.6           (20.3)          18.0
Operating income                      103.8             19.8            240.0           121.4            84.0          118.6
Net income (loss)                      48.0            (44.5)            70.7             2.7            92.5           68.0
</TABLE>


<TABLE>
<CAPTION>
                                           June 30,     December 31,
                                            2004           2003        Change
                                       --------------  -------------  --------
                                                   (In millions)
<S>                                    <C>             <C>            <C>
BALANCE SHEET DATA (AT END OF PERIOD)
Cash                                   $        322.1  $       474.0  $(151.9)
Total Assets                                 11,335.7       11,662.6   (326.9)
Debt                                          3,076.9        3,658.1   (581.2)
<FN>
_____________________
"N/A" means not applicable.

(a)  Average  dayrate is defined as contract drilling revenue earned per revenue
     earning  day  in  the  period.
(b)  Utilization  is  defined as the total actual number of revenue earning days
     as  a  percentage  of  the  total  number  of  calendar days in the period.
</TABLE>


                                       19
<PAGE>
     Our revenue and operating and maintenance expenses for the six months ended
June  30, 2004 increased from the comparable period last year due to the current
year  effect  of including the operations of the drillships Deepwater Pathfinder
and  Deepwater  Frontier as a result of the 2003 acquisitions of the portions of
the Deepwater Drilling L.L.C. ("DD LLC") and Deepwater Drilling II L.L.C. ("DDII
LLC") joint ventures previously held by ConocoPhillips and the subsequent payoff
of  the  synthetic  lease  financing  arrangements  in  late  December  2003. In
addition,  operating revenue and operating and maintenance expense increased due
to  the  riser separation incident on the drillship Discoverer Enterprise, which
idled the rig for a portion of 2003 (see "-Significant Events"), as well as from
higher integrated services provided to our clients in 2004. Our six months ended
June  30, 2004 financial results included a non-cash charge pertaining to a loss
on  retirement of debt partially offset by the recognition of a gain on the sale
of  a semisubmersible rig. We also recognized a gain on the TODCO initial public
offering  ("IPO")  that  was  partially  offset by a tax valuation allowance and
stock  option  expense  recorded  in  relation  to  the  IPO  (see "-Significant
Events").  Debt  and  cash  decreased  during the six months ended June 30, 2004
primarily  as  a  result  of  repayments  on  debt instruments as we continue to
maintain  our focus on debt reduction. The decrease in cash was partially offset
by  proceeds  received  from  the  TODCO  IPO.

     Our  operations are aggregated into two reportable segments: (i) Transocean
Drilling  and  (ii) TODCO. The Transocean Drilling segment consists of floaters,
jackups  and  other  rigs  used  in  support of offshore drilling activities and
offshore  support services. The TODCO segment consists of our interest in TODCO,
which  conducts  jackup,  drilling  barge,  land  rig,  submersible  and  other
operations  in  the  U.S. Gulf of Mexico and inland waters, Mexico, Trinidad and
Venezuela.  We  provide  services  with different types of drilling equipment in
several  geographic  regions.  The  location  of  our rigs and the allocation of
resources  to build or upgrade rigs is determined by the activities and needs of
our  customers.

     We  categorize  our  Transocean  Drilling  segment  fleet  into  a
"High-Specification  Floaters"  category,  consisting  of  our "Fifth-Generation
Deepwater  Floaters,"  "Other  Deepwater Floaters" and "Other High-Specification
Floaters,"  an  "Other  Floaters"  category,  a "Jackups" category and an "Other
Rigs" category. Within our High-Specification Floaters category, we consider our
Fifth-Generation  Deepwater  Floaters  to  be  the  semisubmersibles  Deepwater
Horizon,  Cajun  Express, Deepwater Nautilus, Sedco Energy and Sedco Express and
the  drillships  Deepwater  Discovery, Deepwater Expedition, Deepwater Frontier,
Deepwater  Millennium,  Deepwater  Pathfinder,  Discoverer Deep Seas, Discoverer
Enterprise,  and  Discoverer  Spirit.  These  rigs  were  built  in  the  last
construction cycle and have high-pressure mud pumps and a water depth capability
of 7,500 feet or greater. The Other Deepwater Floaters are generally those other
semisubmersible rigs and drillships that have a water depth capacity of at least
4,500  feet.  The  Other  High-Specification  Floaters are those rigs capable of
drilling  in harsh environments that were built as fourth-generation rigs in the
mid-  to  late-1980's  and have greater displacement than previously constructed
rigs  resulting  in  larger  variable load capacity, more useable deck space and
better  motion  characteristics.  The  Other  Floaters  category  is  generally
comprised  of  those non-high-specification floaters with a water depth capacity
of  less than 4,500 feet. The Jackups category consists of this segment's jackup
fleet,  and  the  Other  Rigs  category  consists  of  other  rigs that are of a
different  type or use. These categories reflect how we view, and how we believe
our  investors  and  the  industry  generally  view,  our fleet, and reflect our
strategic  focus  on  the  ownership and operation of premium high-specification
floating  rigs  and  jackups.

SIGNIFICANT EVENTS

Transocean Drilling Segment

     Operational Incidents - In May 2003, we announced that a drilling riser had
separated  on our deepwater drillship Discoverer Enterprise and that the rig had
temporarily  suspended  drilling  operations  for  our customer. The rig resumed
operations  in  July  2003  and  we  resolved  a  disagreement with our customer
regarding  the  incident  in  early 2004, the result of which had no significant
effect on our results of operations. In June 2004, we finalized discussions with
our insurers relating to an insurance claim for a portion of our losses stemming
from this incident and received a significant portion of an insurance settlement
in  June 2004, which had a favorable effect on pre-tax earnings of approximately
$11.5  million.


                                       20
<PAGE>
     In July 2004, members of the OFS, one of three unions representing offshore
workers in Norway, called a strike on our semisubmersible units operating in the
country.  OFS  called  the strike after it was unable to reach an agreement with
the Norwegian Shipowners Association, which represents rig owners in Norway. The
rigs  immediately  affected  are  the  Polar  Pioneer,  Transocean  Searcher and
Transocean  Leader.  Although  not  currently  operating,  the  semisubmersible
Transocean  Arctic  was  expected  to commence a contract by mid-August 2004 but
could  now be affected by the strike. The striking workers have now departed the
rigs  and  the  crews  have  been reduced to essential personnel only. We do not
believe a resolution is imminent and cannot provide any assurance as to when the
rigs  will  be  able  to  go  back to work. At this time, we cannot estimate the
aggregate  financial  impact  of  the  strike.

     In  July  2004,  the jackup rig Trident 20 suffered damage resulting from a
fire  in  the  rig's  engine  room  while operating offshore Turkmenistan in the
Caspian  Sea.  The  cause  of  the  fire  is  under investigation and the rig is
expected  to  be  idle  for  approximately four months. The rig has been under a
three-well  contract.  Pursuant  to  the contract, our customer has the right to
terminate the contract. While the contract has been suspended by the customer to
allow  time  for  rig  repairs and we expect that drilling will resume under the
terms of the original contract upon completion of the repairs, no assurances can
be  given  that  the  contract  will not be terminated. We are in the process of
completing  an  estimate  of  the  expected  costs  to  repair  the  rig.

     We expect the Norway strike and effect of the Trident 20 fire to negatively
impact  third  quarter  revenue  and  related  earnings.

     Asset  Disposition  -  In  June  2004,  we  completed  the  sale  of  a
semisubmersible  rig,  the  Sedco  602,  for net proceeds of approximately $28.0
million  and  recognized  a  gain  of  $21.6  million.

     Debt  Redemption - In March 2004, we completed the redemption of our $289.8
million  principal amount outstanding 9.5% Senior Notes due December 2008 at the
make-whole  premium  price provided in the indenture. We redeemed these notes at
127.796%  of  face value or $370.3 million, plus accrued and unpaid interest. We
recognized  an  after-tax  loss on the redemption of debt of approximately $28.1
million in the first quarter of 2004, which reflected adjustments for fair value
of  the  debt  at  the  merger ("R&B Falcon merger") with R&B Falcon Corporation
("R&B  Falcon")  and the premium on the termination of the related interest rate
swap.  We  funded  the  redemption  with  existing cash balances, which included
proceeds  from  the  TODCO  IPO.  The  redemption did not affect the 9.5% Senior
Notes  due  December  2008  of  TODCO,  which  had an aggregate principal amount
outstanding  of  $10.2  million  at  June  30,  2004.

TODCO Segment

     IPO  and Secondary Offering - In February 2004, we completed the TODCO IPO,
in  which  we  sold  13.8  million  shares  of  TODCO's  class  A  common stock,
representing  approximately  23  percent of TODCO's total outstanding shares, at
$12.00  per  share.  We received net proceeds of $155.7 million from the IPO and
recognized  a  gain of approximately $39.4 million in the first quarter of 2004,
which  represents the excess of net proceeds received over the net book value of
the  TODCO  shares  sold  in  the  IPO.  Additionally,  as  a  result  of  the
deconsolidation  of  TODCO  from  our  other  U.S. subsidiaries for U.S. federal
income  tax  purposes  in  conjunction  with  the IPO, we established an initial
valuation  allowance in the first quarter of 2004 of approximately $31.0 million
against the estimated deferred tax assets of TODCO in excess of its deferred tax
liabilities,  taking  into  account  prudent and feasible planning strategies as
required  by  Financial  Accounting  Standards  Board's  ("FASB")  Statement  of
Financial  Accounting  Standards  ("SFAS") 109, Accounting for Income Taxes. The
ultimate  amount  of such valuation allowance could vary significantly depending
upon a number of factors, including the final allocation of tax benefits between
TODCO  and  our  other  subsidiaries  under  applicable  law, taxable income for
calendar  year  2004  and our ability to implement tax planning strategies under
SFAS  109.

     In  conjunction with the closing of the TODCO IPO, TODCO granted restricted
stock  and  stock  options  to  certain  of  its  employees  under its long-term
incentive  plan  and  certain  of  these  awards vested at the time of grant. In
accordance  with  the  provisions  of  the  SFAS 123, Accounting for Stock-Based
Compensation,  TODCO  expects to recognize compensation expense of approximately
$17.0  million  over  the  vesting  periods  of  the  awards.  TODCO  recognized
approximately  $6.0  million  in  the  first  quarter of 2004 as a result of the
immediate vesting of certain


                                       21
<PAGE>
awards.  TODCO will amortize the remaining amount of approximately $11.0 million
to  compensation  expense  over  the  next  three  years with approximately $5.0
million  over  the  remainder  of  2004  and approximately $5.0 million and $1.0
million  in  2005  and  2006,  respectively.  In  addition,  certain  of TODCO's
employees  held  options  that  were  granted  prior  to  the IPO to acquire our
ordinary  shares.  In  accordance  with  the  employee  matters agreement, these
options  were modified, which resulted in the accelerated vesting of the options
and  the  extension  of the term of the options through the original contractual
life.  In  connection  with  the modification of these options, TODCO recognized
approximately  $1.5 million additional compensation expense in the first quarter
of  2004.

     As  of  July 30, 2004, we held an approximate 77 percent interest in TODCO,
represented  by  46.2  million  shares  of  class  B  common  stock, and we have
approximately 94 percent of the outstanding voting interest in TODCO. Each share
of  our  class  B common stock has five votes per share compared to one vote per
share  of  the  class  A  common  stock.  We  consolidate TODCO in our financial
statements  as a separate business segment and expect to continue to consolidate
TODCO  in  our  financial  statements  until  we no longer own a majority voting
interest. TODCO was formerly known as R&B Falcon. Before the closing of the IPO,
TODCO transferred to us all assets and businesses unrelated to TODCO's business.
R&B  Falcon's  business was previously considerably broader than TODCO's ongoing
business.

     Our  current  long-term  intent  is to dispose of our remaining interest in
TODCO,  which  could  be  achieved  through  a  number  of possible transactions
including  additional  public offerings, open market sales, sales to one or more
third  parties,  a  spin-off  to  our  shareholders,  split-off offerings to our
shareholders  that  would  allow  for the opportunity to exchange our shares for
shares  of TODCO class A common stock or a combination of these transactions. On
August  3,  2004,  TODCO  filed a registration statement with the Securities and
Exchange  Commission  ("SEC")  relating  to an offering of up to $230 million of
Class  A  common  stock.  We will sell our Class B common stock in the offering,
which  will  convert  to Class A common stock upon sale. TODCO will not sell any
stock  in  the offering and will not receive any proceeds. We expect to complete
this  offering  when  market  conditions warrant, subject to various factors. We
plan to use the proceeds from this offering to reduce debt and for other general
corporate  purposes.

     Delta  Towing  - As a result of the adoption of FASB Interpretation ("FIN")
46  and  a  determination  that TODCO was the primary beneficiary for accounting
purposes  of  our  joint  venture,  Delta Towing Holdings, LLC ("Delta Towing"),
TODCO  consolidated  Delta Towing at December 31, 2003. Due to the consolidation
of  Delta  Towing,  operating  revenue  and  operating  and  maintenance expense
increased  during  the six months ended June 30, 2004 by $13.6 million and $11.9
million,  respectively.

Effective Tax Rate

     The  annual effective tax rate for 2004 is estimated to be approximately 35
percent of earnings before TODCO IPO-related items, loss on debt retirements and
gains  on  significant  asset  sales.  The  effective  tax  rate  increased from
approximately 27 percent estimated at March 31, 2004 as a result of developments
in  the second quarter on certain international tax disputes, an increase in the
valuation  allowance established at the time of the TODCO IPO and changes in the
expected  amount  and geographical concentration of taxable income. The catch-up
effect  of  the  increase  in the annual effective tax rate was reflected in the
second  quarter  of  2004  resulting  in  an effective tax rate of 45 percent on
earnings  for  the  three  months ended June 30, 2004, excluding the sale of the
semisubmersible  rig Sedco 602. As a result, earnings for the three months ended
June  30,  2004  were  reduced  by  $4.6  million.

OUTLOOK

     Drilling  Market  -  During  the  second  quarter of 2004, commodity prices
remained  at  historically  strong  levels. While commodity prices may vary from
current  levels,  we  expect  them  to remain strong in historical terms. Future
commodity  price  expectations  have historically been a key driver for offshore
drilling  demand,  although  recent price levels have not necessarily translated
into  increased  rig  demand.  The  availability  of quality drilling prospects,
exploration  success,  relative  production  costs,  the  stage  of  reservoir
development and political and regulatory environments also affect our customers'
drilling  programs.


                                       22
<PAGE>
     Prospects for our High-Specification Floaters appear to be gaining strength
over  the  balance  of  2004.  However,  a  number  of these units will conclude
contracts in 2004 and, as a result, intermittent idle time remains a possibility
for  some  of  these  rigs.  We  have recently received several new contracts or
extensions  for  our  High  Specification fleet. The Sedco Express was awarded a
three-year  contract  for BP's Plutonio project in Angola. The Paul B. Loyd, Jr.
received  a  two-year  contract  extension,  the Cajun Express was awarded a new
210-day  contract,  the  Deepwater  Discovery  was awarded a combined three-well
commitment  and  the  Sovereign  Explorer was awarded two contracts totaling 320
days.  We continue to believe that over the long term, deepwater exploration and
development drilling opportunities in the Gulf of Mexico, West Africa, India and
other  market  sectors  represent  a  significant source of future deepwater rig
demand,  although  the risk of project delays remains, especially in Nigeria and
Angola.  We  are  also  seeing  a  strong  customer  preference  for  using
fifth-generation  equipment  in  these  deepwater  areas.

     The  outlook for activity for the non-U.S. jackup market sector is expected
to  remain  strong,  particularly  in  Asia and the Middle East. There remains a
current  overcapacity  in  the  West  Africa  jackup  sector  and  Transocean is
repositioning  two  units,  the Trident VI and the J. T. Angel, from West Africa
and India, respectively, to Asia to capture the growth opportunities there.  The
Trident  VI  is  expected  to  be  on  contract  by  October  of  this  year.

     The  outlook  for  our  Other Floaters that operate in the mid-water sector
remains weak as this sector continues to be significantly oversupplied globally.
We  expect  overall  North Sea industry fleet utilization to increase beyond the
usual  normal  seasonal upswing in the summer months.  A number of rigs have now
been  contracted  through  the  winter months and there is a growing expectation
that  overall utilization next year will be higher than 2004. Utilization in the
U.S.  Gulf of Mexico market sector continues to be dampened by an over supply of
units.  There  is  a  possibility of additional work in Brazil and India, and we
are  evaluating  these  opportunities.

     We expect additional downtime during the third quarter to result from other
rig  mobilizations,  primarily  the  Jack  Bates, which we expect to mobilize in
August  of  this  year  from  the  UK  sector of the North Sea to Australia upon
completion  of its current contract, and the Actinia, which is currently idle in
Egypt and will mobilize to India.  In addition to these mobilizations, we expect
downtime  to  result  from  planned  shipyards for the Polar Pioneer, Sedco 706,
Sedco  709  and  the  Transocean  Arctic.  These  rig  mobilizations and planned
shipyard  projects  are  expected  to  have  a  negative impact on third quarter
revenues  and  related  earnings.

     TODCO expects the declining jackup rig supply in the U.S. Gulf Coast region
to  continue  to  support  higher  dayrates for its jackup fleet compared to the
beginning  of  the  year.  TODCO  has  seen a slight improvement in dayrates and
utilizations  for  its  inland  barges  in  2004  in  this  region.

     Our  operations are geographically dispersed in oil and gas exploration and
development  areas  throughout  the  world. Rigs can be moved from one region to
another, but the cost of moving a rig and the availability of rig-moving vessels
may  cause  the  supply  and  demand  balance  to vary somewhat between regions.
However,  significant  variations between regions do not tend to exist long-term
because  of  mobility.  Consequently,  we  operate  in a single, global offshore
drilling  market.

     The  offshore  contract  drilling  market  remains  highly  competitive and
cyclical,  and  it  has  been  historically  difficult to forecast future market
conditions.  Extraneous  risks  include  declines  in oil and/or gas prices that
reduce  rig demand and adversely affect utilization and dayrates. Major operator
and national oil company capital budgets are key drivers of the overall business
climate,  and  these  may  change  within a fiscal year depending on exploration
results  and  other  factors.  Additionally,  increased  competition  for  our
customers'  drilling  budgets  could  come  from,  among other areas, land-based
energy  markets in Russia, other former Soviet Union states and the Middle East.

     As  of  July  27, 2004, approximately 60 percent of our Transocean Drilling
segment fleet days were committed for the remainder of 2004 and approximately 34
percent  for  the  year  2005.

     Tax  Matters  -  We are a Cayman Islands company registered in Barbados. We
operate through our various subsidiaries in a number of countries throughout the
world.  Consequently,  we  are  subject  to  changes  in  tax laws, treaties and
regulations in and between the countries in which we operate, including treaties
that  the  U.S.  has  with  other  nations. A material change in these tax laws,
treaties or regulations, including those in and involving the U.S.,


                                       23
<PAGE>
could  result  in  a higher effective tax rate on our worldwide earnings. Recent
developments  in  this  area  include  proposed tax legislation in the U.S. that
would  change the tax law applicable to companies like us that have undertaken a
transaction  commonly referred to as an inversion and the recent protocol signed
by  the  U.S.  and  Barbados  which  would  amend the tax treaty between the two
countries.

     Our income tax returns are subject to review and examination in the various
jurisdictions  in  which  we  operate.  The  U.S.  Internal  Revenue  Service is
currently auditing our tax returns for calendar years 1999, the year we became a
Cayman  Islands  company,  and  2000.  In  addition,  other tax authorities have
examined  the amounts of income and expense subject to tax in their jurisdiction
for prior periods. We are currently contesting various non-U.S. assessments that
have  been  asserted  and  would  expect  to contest any future U.S. or non-U.S.
assessments.  While  we  cannot  predict  or  provide  assurance as to the final
outcome  of  existing or future assessments, we do not believe that the ultimate
resolution of these asserted income tax liabilities will have a material adverse
effect  on  our  business  or  consolidated  financial  position.

     As  a  result  of  the  deconsolidation  of  TODCO  from  our  other  U.S.
subsidiaries  for  U.S. federal income tax purposes in conjunction with the IPO,
we  established  an  initial  valuation allowance of approximately $31.0 million
against the estimated deferred tax assets of TODCO in excess of its deferred tax
liabilities,  taking  into  account  prudent and feasible planning strategies as
required  by  SFAS  109.  See  "-Significant  Events."

     Stock-Based  Compensation  Expense - As a result of the adoption in January
2003  of  the  fair  value  recognition  provisions  of SFAS 123, Accounting for
Stock-Based  Compensation,  using the prospective method prescribed by SFAS 148,
Accounting  for  Stock-Based  Compensation  Transition  and  Disclosure,  our
stock-based  compensation  expense is expected to increase in 2004. The increase
will  result  from  the  impact  of  a  full year of expense related to our 2003
awards,  compared  to  six months of expense in 2003, and expense related to our
2004  awards,  which  were granted in July 2004. Future periods will continue to
have  increases  in  stock-based  compensation  expense  until the impact of the
layering  effect  of  future  awards is normalized. In addition, TODCO now has a
long-term  incentive  plan  under  which  it grants stock options and restricted
stock  to  certain  key employees (see "-Significant Events"). Awards made under
this plan in 2004 will result in an increase in stock-based compensation expense
in  2004.


                                       24
<PAGE>
PERFORMANCE AND OTHER KEY INDICATORS

     Fleet  Utilization  and  Dayrates - The  following  table shows our average
dayrate  and utilization for the quarterly periods ended on or prior to June 30,
2004. Average dayrate is defined as contract drilling revenue earned per revenue
earning  day in the period. Utilization is defined as the total actual number of
revenue  earning  days  in  the  period  as  a percentage of the total number of
calendar  days  in  the  period  for  all  drilling  rigs  in  our  fleet.

<TABLE>
<CAPTION>
                                                  Three Months Ended
                                          -----------------------------------
                                           June 30,    March 31,    June 30,
                                             2004        2004         2003
                                          ----------  -----------  ----------
<S>                                       <C>         <C>          <C>
Average Dayrates

Transocean Drilling Segment:
   High-Specification Floaters
     Fifth-Generation Deepwater Floaters  $ 177,800   $  191,800   $ 185,100
     Other Deepwater Floaters             $ 107,800   $  101,300   $ 111,500
     Other High-Specification Floaters    $ 115,500   $  115,200   $ 114,400
   Total High-Specification Floaters      $ 141,100   $  143,500   $ 143,300
   Other Floaters                         $  65,000   $   62,800   $  64,800
   Jackups                                $  52,700   $   51,400   $  57,400
   Other Rigs                             $  43,300   $   44,200   $  41,500
                                          ----------  -----------  ----------
Segment Total                             $  89,100   $   90,200   $  88,900
                                          ----------  -----------  ----------

                                          ----------  -----------  ----------
TODCO Segment                             $  26,200   $   25,700   $  17,500
                                          ----------  -----------  ----------

Total Drilling Fleet                      $  69,600   $   71,600   $  65,300
                                          ==========  ===========  ==========

Utilization

Transocean Drilling Segment:
   High-Specification Floaters
     Fifth-Generation Deepwater Floaters         90%          92%         88%
     Other Deepwater Floaters                    70%          78%         70%
     Other High-Specification Floaters           75%          73%         75%
   Total High-Specification Floaters             79%          83%         77%
   Other Floaters                                45%          42%         52%
   Jackups                                       85%          83%         86%
   Other Rigs                                    46%          54%         41%
                                          ----------  -----------  ----------
Segment Total                                    68%          69%         68%
                                          ----------  -----------  ----------

                                          ----------  -----------  ----------
TODCO Segment                                    41%          38%         42%
                                          ----------  -----------  ----------

Total Drilling Fleet                             56%          56%         57%
                                          ==========  ===========  ==========
</TABLE>

     Contract  Drilling  Revenue  -  Our  contract  drilling  revenues are based
primarily  on  dayrates  received  for  our  drilling services and the number of
operating  days  during the relevant periods. The level of our contract drilling
revenue  depends on dayrates, which in turn are primarily a function of industry
supply  and demand for drilling units in the markets in which we operate. During
periods  of  high  demand,  our  rigs  typically  achieve higher utilization and
dayrates  than during periods of low demand. Some of our drilling contracts also
enable us to earn mobilization, contract preparation, capital upgrade, bonus and
demobilization  revenue.  Mobilization, contract preparation and capital upgrade
revenue  earned  on  a  lump  sum basis is recognized over the original contract
term.  Bonus  and  demobilization  revenue  is  recognized  when  earned.


                                       25
<PAGE>
     Other  Revenue  -  Beginning  with  the  first  quarter  of  2004, we began
classifying  our revenues into two categories: (1) contract drilling revenue and
(2)  other  revenue.  Our  other revenue represents client reimbursable revenue,
integrated  services  revenue,  management  service  revenues,  revenues  from
operation  of  Delta  Towing's  fleet  of  marine  support  vessels  and  other
miscellaneous  revenues. From time to time, we provide well services in addition
to  our  normal  drilling  services through third party contractors. We refer to
these  other  services  as  integrated  services.

     Operating  and  Maintenance  Costs  -  Our  operating and maintenance costs
represent  all  direct  and  indirect  costs  associated  with the operation and
maintenance  of  our  drilling  rigs.  The principal elements of these costs are
direct  and indirect labor and benefits, repair and maintenance, insurance, boat
and  helicopter  rentals,  professional  and  technical  fees,  freight  costs,
communications,  customs  duties,  tool  rentals  and  services, fuel and water,
general  taxes  and  licenses. Labor, repair and maintenance and insurance costs
represent  the  most  significant  components  of  our operating and maintenance
costs.

     We  do  not  expect  operating  and  maintenance  expenses  to  necessarily
fluctuate in proportion to changes in operating revenues. Operating revenues may
fluctuate  as  a  function of changes in dayrate. However, costs for operating a
rig  are  generally  fixed or only semi-variable regardless of the dayrate being
earned.  In  addition,  should  our  rigs  incur idle time between contracts, we
typically  do  not de-man those rigs because we will use the crew to prepare the
rig for its next contract. During times of reduced activity, reductions in costs
may not be immediate as portions of the crew may be required to prepare our rigs
for  stacking,  after which time the crew members are assigned to active rigs or
dismissed.  In  general,  labor  costs  increase  primarily due to higher salary
levels  and  inflation.  Equipment maintenance expenses fluctuate depending upon
the  type  of  activity  the unit is performing and the age and condition of the
equipment. While our per occurrence deductible levels for our hull and machinery
and  our  protection  and indemnity policies remained unchanged from 2003 at $10
million,  we  increased our additional aggregate annual insurance deductible for
the  current policy year in an effort to reduce costs. This additional aggregate
annual  deductible of $20 million is applied after the per occurrence deductible
is  met  until it is fully utilized at which time the $10 million per occurrence
applies  for  all  remaining  claims  during  the  year.

     Depreciation  Expense  -  Our  depreciation  expense is based on estimates,
assumptions  and  judgments  relative  to  capitalized  costs,  useful lives and
salvage  values  of  our  assets.  We  generally  compute depreciation using the
straight-line  method  after  allowing  for  salvage  values.

     General  and  Administrative  Expense  - General and administrative expense
includes  all  costs  related  to  our corporate executives, directors, investor
relations,  corporate accounting and reporting, information technology, internal
audit,  legal,  tax,  treasury,  risk  management  and human resource functions.

     Interest  Expense  -  Interest expense consists of interest associated with
our  senior  notes  and  other  debt  and  related  financing cost amortization.
Interest  expense  is  partially offset by the amortization of gains on interest
rate  swaps terminated during 2003. We expect the amortization of these gains to
continue  over  the  life  of  the  related  debt  instruments (see "-Derivative
Instruments").

     Income  Taxes  -  Provisions for income taxes are based on expected taxable
income,  statutory  rates  and tax planning opportunities available to us in the
various  jurisdictions  in  which  we  operate.  Taxable  income may differ from
pre-tax income for financial accounting purposes, particularly in countries with
revenue-based taxes. There is no expected relationship between the provision for
income  taxes  and  income before income taxes because the countries in which we
operate  have  different  taxation regimes. We provide a valuation allowance for
deferred  tax  assets  when  it  is more likely than not that some or all of the
benefit  from  the  deferred  tax  asset  will  not  be realized. See "-Critical
Accounting  Policies."


                                       26
<PAGE>
FINANCIAL CONDITION

     JUNE 30, 2004 COMPARED TO DECEMBER 31, 2003

<TABLE>
<CAPTION>
                       June 30,   December 31,
                         2004         2003        Change   % Change
                       ---------  -------------  --------  ---------
                               (In millions, except % change)
<S>                    <C>        <C>            <C>       <C>
TOTAL ASSETS
  Transocean Drilling  $10,589.3  $    10,874.0  $(284.7)       (3)%
  TODCO                    746.4          788.6    (42.2)       (5)%
                       ---------  -------------  --------  ---------
                       $11,335.7  $    11,662.6  $(326.9)       (3)%
                       =========  =============  ========  =========
</TABLE>

     The  decrease in Transocean Drilling segment assets was mainly due to asset
depreciation  ($216.4  million), a decrease in cash and cash equivalents ($159.4
million)  that  resulted  primarily  from the repayment of debt of approximately
$592.2  million  during  the  six  months  ended June 30, 2004 and the sale of a
semisubmersible  rig  ($6.0 million), partially offset by proceeds received from
the  TODCO  IPO ($155.7 million) and cash from operations. The decrease in TODCO
segment  assets  was  primarily  due  to  depreciation  ($48.1  million).

LIQUIDITY AND CAPITAL RESOURCES

     SOURCES AND USES OF CASH

<TABLE>
<CAPTION>
                                                 Six Months Ended
                                                     June 30,
                                           ------------------------
                                               2004         2003      Change
                                           ------------  ----------  --------
<S>                                        <C>           <C>         <C>
                                                     (In millions)
NET CASH PROVIDED BY OPERATING ACTIVITIES
  Net income                               $      70.7   $      2.7  $  68.0
  Depreciation                                   264.5        254.3     10.2
  Other non-cash items                            (9.3)        11.4    (20.7)
  Working capital                                (45.3)        36.3    (81.6)
                                           ------------  ----------  --------
                                           $     280.6   $    304.7  $ (24.1)
                                           ============  ==========  ========
</TABLE>

     Net  cash provided by operating activities decreased $24.1 million due to a
decrease  in  cash provided by working capital items of $81.6 million, partially
offset  by  an  increase in cash generated from net income adjusted for non-cash
activity  of $57.5 million during the six months ended June 30, 2004 as compared
to  the  corresponding  prior  year  period.

<TABLE>
<CAPTION>
                                                         Six Months Ended
                                                             June 30,
                                                     ------------------------
                                                         2004         2003      Change
                                                     ------------  ----------  --------
<S>                                                  <C>           <C>         <C>
                                                               (In millions)
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES
  Capital expenditures                               $     (55.8)  $   (50.2)  $  (5.6)
  Proceeds from disposal of assets                          42.0         3.2      38.8
  Proceeds from TODCO IPO                                  155.7           -     155.7
  DDII LLC's cash acquired, net of cash paid                   -        18.1     (18.1)
  Note issued to related party, net of repayments              -       (45.3)     45.3
  Other, net                                                 4.7         2.2       2.5
                                                     ------------  ----------  --------
                                                     $     146.6   $   (72.0)  $ 218.6
                                                     ============  ==========  ========
</TABLE>

     Net  cash  provided  by investing activities increased approximately $218.6
million  for  the six months ended June 30, 2004 as compared to net cash used in
investing  activities  in  the same period in the previous year. The increase


                                       27
<PAGE>
is  primarily  the  result  of the proceeds from the TODCO IPO of $155.7 million
(see  "-Significant  Events")  combined  with an increase in proceeds from asset
sales  as  compared  to  the  corresponding  prior  year period. In addition, we
acquired  ConocoPhillips'  40  percent  interest  in  DDII LLC and issued a note
receivable to a related party during the six months ended June 30, 2003, with no
comparable  activity  for  the  same  period  in  2004.

<TABLE>
<CAPTION>
                                                              Six Months Ended
                                                                   June 30,
                                                         ------------------------
                                                             2004         2003      Change
                                                         ------------  ----------  --------
<S>                                                      <C>           <C>         <C>
                                                                    (In millions)
NET CASH USED IN FINANCING ACTIVITIES
  Repayments on revolving credit agreements              $    (200.0)  $       -   $(200.0)
  Cash received from termination of interest rate swaps            -       173.5    (173.5)
  Repayments on other debt instruments                        (395.2)     (919.2)    524.0
  Other, net                                                    16.1        12.8       3.3
                                                         ------------  ----------  --------
                                                         $    (579.1)  $  (732.9)  $ 153.8
                                                         ============  ==========  ========
</TABLE>

     We repaid $200.0 million under our $800.0 million revolving credit facility
during the six months ended June 30, 2004 while no such payment was made for the
same  period  in  2003.  For the six months ended June 30, 2004, we used cash of
$370.3  million  for  the  early  redemption  of  our  9.5%  Senior  Notes  (see
"-Significant Events") and $21.9 million in other scheduled debt maturities. For
the  six  months ended June 30, 2003, we received interest rate swap termination
proceeds  of  $173.5 million (see "-Derivative Instruments") for which there was
no  comparable  activity in 2004. In addition, we used cash of $527.2 million to
repurchase  our  Zero  Coupon  Convertible Debentures that were put to us in May
2003,  $50.0  million  for  the  early  repayment of our 9.41% Nautilus Class A2
Notes,  and  $342.0  million  for other scheduled debt maturities during the six
months  ended  June  30,  2003.

     CAPITAL EXPENDITURES

     Capital expenditures totaled $55.8 million during the six months ended June
30,  2004  of  which  $51.0  million  and $4.8 million related to the Transocean
Drilling  and  TODCO  segments,  respectively.

     During  2004,  we expect to spend approximately $90 million to $100 million
on  our existing Transocean Drilling segment fleet, corporate infrastructure and
major  upgrades,  excluding  upgrades  required  and  funded  by  our  drilling
contracts, which we anticipate will be approximately $30 million to $40 million.
These amounts are dependent upon the actual level of operational and contracting
activity.  We  intend  to  fund  the  cash  requirements relating to our capital
expenditures through available cash balances, cash generated from operations and
asset  sales. We also have available credit under our revolving credit agreement
(see "-Sources of Liquidity") and may engage in other commercial bank or capital
market  financings.

     TODCO expects to spend approximately $13 million on capital expenditures in
2004.

     ACQUISITIONS AND DISPOSITIONS

     From  time  to  time,  we  review  possible  acquisitions of businesses and
drilling  units  and  may in the future make significant capital commitments for
such  purposes.  Any  such  acquisition  could  involve  the  payment by us of a
substantial amount of cash or the issuance of a substantial number of additional
ordinary  shares  or  other securities. We would likely fund the cash portion of
any such acquisition through cash balances on hand, the incurrence of additional
debt,  sales  of  assets,  issuance  of ordinary shares or other securities or a
combination  thereof.  In  addition,  from  time  to  time,  we  review possible
dispositions  of  drilling  units.

     Dispositions  -  In  February  2004,  we  completed  the  TODCO  IPO.  See
"-Significant  Events."

     In  March  2004,  in  our  Transocean  Drilling  segment  we  entered  into
agreements  to  sell  two semisubmersible rigs, the Sedco 600 and Sedco 602, for
net  proceeds  of  $52.7  million,  in connection with our efforts to dispose of


                                       28
<PAGE>
certain  non-strategic  assets.  In  June  2004,  we  completed  the  sale  of a
semisubmersible  rig,  the  Sedco  602,  for  net  proceeds of $28.0 million and
recognized  a  gain  of  $21.6 million, which had no tax effect. The sale of the
Sedco  600  is  expected  to  close  during  the  fourth  quarter  of 2004 after
completion  of  a  drilling  project.

     During  the six months ended June 30, 2004, we settled insurance claims and
sold  marine  support  vessels  and  certain  other  assets  for net proceeds of
approximately  $14.0  million and recorded net gains of $1.0 million, net of tax
of  $0.4  million,  and $4.6 million, which had no tax effect, in our Transocean
Drilling  and  TODCO  segments,  respectively.

     SOURCES OF LIQUIDITY

     Our  primary  sources  of  liquidity in the second quarter of 2004 were our
cash  flows  from  operations,  proceeds  from  asset  sales  and  existing cash
balances.  Our  primary  uses  of  cash  were  debt  repayments  and  capital
expenditures.  At  June  30,  2004,  we  had  $322.1  million  in  cash and cash
equivalents.

     We  expect  to  use existing cash balances, internally generated cash flows
and  proceeds  from  assets  sales,  including potential additional sales of our
interest  in  TODCO,  to  fulfill anticipated obligations such as scheduled debt
maturities,  capital  expenditures and working capital needs. From time to time,
we  may  also use bank lines of credit to maintain liquidity for short-term cash
needs.

     Excluding  the  acquisition  of  the  Deepwater  Pathfinder  and  Deepwater
Frontier  in  December  2003,  we  have  significantly  reduced  our  capital
expenditures  compared  to  prior  years  due  to the completion of our newbuild
program  in  2001  and  ongoing  efforts  to  contain capital expenditures.  See
"-Capital  Expenditures."

     When  cash  on hand, cash flows from operations, proceeds from asset sales,
including  potential  additional  sales  of our interest in TODCO, and committed
bank  facility  availability  exceed  our expected liquidity needs, we may use a
portion  of  such  cash  to  reduce  debt  prior  to  scheduled maturity through
repurchases,  redemptions  or  tender  offers,  or  make  repayments  on  bank
borrowings.

     At June 30, 2004 and December 31, 2003, our total debt was $3,076.9 million
and  $3,658.1  million,  respectively.  Net  debt,  a non-GAAP financial measure
defined as total debt less cash and cash equivalents, at such dates was $2,754.8
million and $3,184.1 million, respectively. During the six months ended June 30,
2004, we reduced net debt by $429.3 million. The reconciliation of total debt to
net  debt  at  carrying  value  is  as  follows  (in  millions):

<TABLE>
<CAPTION>
                                  June 30,    December 31,
                                    2004          2003
                                 ----------  --------------
<S>                              <C>         <C>
Total Debt                       $ 3,076.9   $     3,658.1
Less: Cash and cash equivalents     (322.1)         (474.0)
                                 ----------  --------------
  Net Debt                       $ 2,754.8   $     3,184.1
                                 ==========  ==============
</TABLE>

     We  believe net debt provides useful information regarding the level of our
indebtedness  by  reflecting  the  amount  of  indebtedness  assuming  cash  and
investments  are  used  to  repay  debt.  Net debt declined each year since 2001
because  cash  flows,  primarily  from operations and asset sales, have exceeded
capital  expenditures.

     Our  internally generated cash flow is directly related to our business and
the  market sectors in which we operate. Should the drilling market deteriorate,
or  should  we  experience  poor  results  in  our  operations,  cash  flow from
operations  may  be  reduced. Also, as a result of the TODCO IPO, we do not have
access  to  TODCO's  cash flows as we do with our wholly owned subsidiaries.  We
have,  however,  continued  to  generate  positive  cash  flow  from  operating
activities  over  recent years and expect cash flow will continue to be positive
over  the  next  year.

     We  have  access to a bank line of credit under an $800.0 million five-year
revolving  credit  agreement  expiring  in  December  2008. As of June 30, 2004,
$750.0  million  remained  available under this credit line. Because our current
cash balances, expected cash flow and this revolving credit agreement provide us
with  adequate  liquidity, we terminated our commercial paper program during the
first  quarter  of  2004.


                                       29
<PAGE>
     The  bank  credit  line  requires  compliance  with  various  covenants and
provisions customary for agreements of this nature, including an earnings before
interest,  taxes,  depreciation and amortization ("EBITDA") to interest coverage
ratio  and  a  debt  to  tangible  capital  ratio, both as defined by the credit
agreement,  of  not  less  than  three  to  one and not greater than 50 percent,
respectively.  Other  provisions of the credit agreement includes limitations on
creating  liens,  incurring  debt,  transactions with affiliates, sale/leaseback
transactions and mergers and sale of substantially all assets. Should we fail to
comply  with these covenants, we would be in default and may lose access to this
facility. We are also subject to various covenants under the indentures pursuant
to  which  our public debt was issued, including restrictions on creating liens,
engaging in sale/leaseback transactions and engaging in merger, consolidation or
reorganization  transactions.  A  default  under our public debt could trigger a
default  under  our  credit  line  and cause us to lose access to this facility.

     TODCO  has  access  to a bank line of credit under a $75.0 million two-year
revolving  credit agreement (the "TODCO Revolving Credit Agreement"), which will
reduce  to  $60.0  million  in December 2004 and expires in December 2005. As of
June  30,  2004, $75.0 million remained available under this line of credit. The
TODCO  Revolving Credit Agreement requires compliance with various covenants and
provisions  customary for similar agreements of non-investment grade facilities.
TODCO's  Revolving  Credit  Agreement  is  not  guaranteed  by  us.

     In  April 2001, the SEC declared effective our shelf registration statement
on Form S-3 for the proposed offering from time to time of up to $2.0 billion in
gross  proceeds  of  senior  or subordinated debt securities, preference shares,
ordinary  shares  and  warrants  to purchase debt securities, preference shares,
ordinary  shares  or  other  securities. At June 30, 2004, $1.6 billion in gross
proceeds of securities remained unissued under the shelf registration statement.

     Our access to debt and equity markets may be reduced or closed to us due to
a variety of events, including, among others, downgrades of ratings of our debt,
industry  conditions,  general economic conditions, market conditions and market
perceptions  of  us  and  our  industry.

     As  is  customary  in  the contract drilling business, we also have various
surety  bonds  in  place  that  secure  customs  obligations  relating  to  the
importation  of  our  rigs and certain performance and other obligations. Surety
bonds  outstanding totaled $22.5 million and $169.5 million at June 30, 2004 and
December  31,  2003,  respectively.  The decrease in outstanding surety bonds is
primarily  attributable  to  the  expiration of three such bonds totaling $151.1
million  related  to  our  Brazil  operations.

     DERIVATIVE INSTRUMENTS

     We have established policies and procedures for derivative instruments that
have  been  approved  by  our  Board of Directors. These policies and procedures
provide  for the prior approval of derivative instruments by our Chief Financial
Officer.  From time to time, we may enter into a variety of derivative financial
instruments in connection with the management of our exposure to fluctuations in
foreign  exchange  rates  and  interest  rates.  We do not enter into derivative
transactions for speculative purposes; however, for accounting purposes, certain
transactions  may  not  meet  the  criteria  for  hedge  accounting.

     Gains and losses on foreign exchange derivative instruments that qualify as
accounting  hedges are deferred as accumulated other comprehensive income (loss)
and  recognized when the underlying foreign exchange exposure is realized. Gains
and  losses  on  foreign  exchange derivative instruments that do not qualify as
hedges  for  accounting purposes are recognized currently based on the change in
market value of the derivative instruments. At June 30, 2004, we had no material
open  foreign  exchange  derivative  instruments.

     From  time  to time, we may use interest rate swaps to manage the effect of
interest  rate changes on our future earnings. Interest rate swaps that we enter
into  are  designated  as  a hedge of future interest payments on our underlying
debt.  The  interest rate differential to be received or paid under the swaps is
recognized  over the lives of the swaps as an adjustment to interest expense. If
an  interest  rate  swap  is  terminated, the gain or loss is amortized over the
remaining  life of the underlying debt. We do not enter into interest rate swaps
for  speculative  purposes.


                                       30
<PAGE>
     In January 2003, we terminated swaps with respect to our 6.75% Senior Notes
due  April  2005,  6.95%  Senior  Notes due April 2008 and 9.5% Senior Notes due
December  2008.  In  March  2003, we terminated swaps with respect to our 6.625%
Notes  due  April  2011.  As  a  result  of these terminations, we received cash
proceeds,  net  of  accrued  interest,  of approximately $173.5 million that was
recognized  as  a  fair  value  adjustment to long-term debt in our consolidated
balance sheet and is being amortized as a reduction to interest expense over the
life  of  the  underlying debt. As a result of the redemption of our 9.5% Senior
Notes  in  March  2004,  we  recognized  a  swap premium of $22.0 million on the
termination  of  the  related  interest  rate swap as a reduction to our loss on
retirement of debt (see "-Operating Results"). Based on the unamortized premiums
remaining  on the terminated interest rate swaps, we expect our interest expense
to  be  approximately  $24.0  million  lower  in  2004.

OPERATING RESULTS

     QUARTER ENDED JUNE 30, 2004 COMPARED TO QUARTER ENDED JUNE 30, 2003

     Following  is  an  analysis  of  our  Transocean Drilling segment and TODCO
segment  operating  results,  as  well  as  an  analysis  of  income and expense
categories  that  we  have  not  allocated  to  our  two  segments.

<TABLE>
<CAPTION>
Transocean Drilling Segment

                                                                  Three Months Ended
                                                             -----------------------------
                                                                        June 30,
                                                                  2004            2003         Change        % Change
                                                             ---------------  ------------  -------------  ------------
<S>                                                          <C>              <C>           <C>            <C>
                                                                   (In millions, except day amounts and percentages)

Operating days                                                        5,795         5,887            (92)          (2)%
Utilization (a)                                                          68%           68%           N/A            N/M
Average dayrate (b)                                          $       89,100   $    88,900   $        200            N/M

Contract drilling revenues                                   $        516.6   $     523.6   $       (7.0)          (1)%
Other revenues                                                         35.9          24.9           11.0            44%
                                                             ---------------  ------------  -------------  ------------
                                                                      552.5         548.5            4.0             1%
Operating and maintenance expense                                     338.1         355.9          (17.8)          (5)%
Depreciation                                                          109.1         104.4            4.7             5%
Impairment loss on long-lived assets                                      -           4.2           (4.2)           N/M
Gain from sale of assets, net                                         (21.9)         (0.2)         (21.7)           N/M
                                                             ---------------  ------------  -------------  ------------
Operating income before general and administrative expense   $        127.2   $      84.2   $       43.0            51%
                                                             ===============  ============  =============  ============
<FN>
_________________
"N/A" means not applicable
"N/M" means not meaningful

(a)  Utilization  is  defined  as  the  total  actual number of revenue earning days as a percentage of total number of
     calendar  days  in  the  period.
(b)  Average  dayrate  is  defined  as  contract  drilling  revenue  earned  per  revenue  earning  day.
</TABLE>

     This  segment's contract drilling revenues increased by approximately $42.5
million  as  a  result  of  additional  revenues from the Deepwater Frontier and
Deepwater Pathfinder due to the consolidation of DDII LLC and DD LLC late in the
second  and  fourth  quarters,  respectively, of 2003 and lower revenues in 2003
resulting  from  the  labor  strike  in Nigeria, the Discoverer Enterprise riser
incident  and  the Peregrine I electrical fire during the second quarter of 2003
with  no  comparable  activity for the same period in 2004. These increases were
more  than  offset  by  approximately  $49.5 million due to a decline in average
dayrates,  which  exclude  the  rigs  previously  discussed.

     Other  revenues for the three months ended June 30, 2004 included increases
of  $13.1 million related to integrated services, partially offset by a decrease
of  $2.6  million in client reimbursable revenue and the absence of


                                       31
<PAGE>
revenue  from  management  fees in 2004 as a result of the consolidation of DDII
LLC  and  DD  LLC late in the second and fourth quarters, respectively, of 2003.

     The  decrease  in  this  segment's  operating  and  maintenance expenses of
approximately  $19.5  million  resulted primarily from the settlement in 2004 of
the  Discoverer  Enterprise  May 2003 riser incident and a decrease in insurance
expense  in  the  second  quarter of 2004. Additional decreases of approximately
$13.3  million  resulted  from  costs  associated with the Peregrine I insurance
claim  settlement,  the  labor  strike  in  Nigeria,  reserve  for allowance for
doubtful  accounts  related  to  two  client receivables and a favorable turnkey
settlement  that  occurred  in  the  second  quarter  of 2003 with no comparable
activity  in 2004. Partially offsetting these decreases were increased operating
and maintenance expenses of approximately $14.2 million related primarily to the
Deepwater  Pathfinder  as  a  result  of the consolidation of DD LLC late in the
fourth  quarter  of  2003,  higher  integrated  services  activity  and  higher
provisions  for  local  tax  matters  in  2004.

     The increase in this segment's depreciation expense resulted primarily from
$4.9  million  of  additional  depreciation  expense  related  to  the Deepwater
Frontier  and  Deepwater Pathfinder as a result of the late December 2003 payoff
of  the  synthetic  lease  financing  arrangements  by  DDII  LLC  and  DD  LLC,
respectively,  which  were  consolidated late in the second and fourth quarters,
respectively, of 2003 and the Discoverer Enterprise purchase of tensioner system
equipment.

     During  the  three  months  ended  June  30,  2003,  we  recorded  non-cash
impairment  charges  in this segment of $4.2 million associated with the removal
of  two  rigs  from drilling service. The determination of fair market value was
based  on  an  offer  from  a  potential  buyer.

     During  the  three  months ended June 30, 2004, this segment recognized net
gains  of $21.9 million related to the sale of the semisubmersible rig Sedco 602
and  the  sale  of  other  assets.


                                       32
<PAGE>
<TABLE>
<CAPTION>
TODCO Segment

                                                                Three Months Ended
                                                                     June 30,
                                                           -----------------------------
                                                                2004            2003         Change        % Change
                                                           ---------------  ------------  -------------  ------------
<S>                                                        <C>              <C>           <C>            <C>
                                                                  (In millions, except day amounts and percentages)

Operating days                                                      2,612         2,919           (307)         (11)%
Utilization (a)                                                        41%           42%           N/A           (2)%
Average dayrate (b)                                        $       26,200   $    17,500   $      8,700            50%

Contract drilling revenues                                 $         68.3   $      51.1   $       17.2            34%
Other revenues                                                       12.4           4.3            8.1            N/M
                                                           ---------------  ------------  -------------  ------------
                                                                     80.7          55.4           25.3            46%
Operating and maintenance                                            68.1          70.6           (2.5)          (4)%
Depreciation                                                         23.9          23.1            0.8             3%
Impairment loss on long-lived assets                                    -          11.6          (11.6)           N/M
Gain from sale of assets, net                                        (1.9)         (0.4)          (1.5)           N/M
                                                           ---------------  ------------  -------------  ------------
Operating loss before general and administrative expense   $         (9.4)  $     (49.5)  $       40.1          (81)%
                                                           ===============  ============  =============  ============
<FN>
_________________
"N/A" means not applicable
"N/M" means not meaningful

(a)     Utilization  is defined as the total actual number of revenue earning days as a percentage of total number of
        calendar  days  in  the  period.
(b)     Average  dayrate  is  defined  as  contract  drilling  revenue  earned  per  revenue  earning  day.
</TABLE>

     This  segment's contract drilling revenues increased by approximately $23.2
million  due  primarily  to  an increase in average dayrates, which included the
operations  of  three jackup rigs in Venezuela (THE 156) and Mexico (THE 205 and
THE  206)  after  being  transferred  from  the Gulf of Mexico during the fourth
quarter  of 2003. These increases were partially offset by decreased utilization
of  approximately  $5.9  million.

     Other  revenues for the three months ended June 30, 2004 included increases
of  approximately  $8.1  million related to the consolidation of Delta Towing at
December  31,  2003  and  client  reimbursable  revenue.

     The  decrease  in  this  segment's  operating  and  maintenance expense was
primarily due to approximately $11.8 million of costs associated with the inland
barge  Rig  62 well control incident in 2003 with no comparable activity in 2004
and  a  decrease  in insurance expense. Partially offsetting the above decreases
were  increases  primarily due to approximately $5.6 million of costs associated
with  the consolidation of Delta Towing at December 31, 2003 and $4.8 million of
operating  and  maintenance expense associated with operating two jackup rigs in
Mexico (THE 205 and THE 206) after being transferred from the Gulf of Mexico and
compensation expense related to stock options and restricted stock as the result
of  the  TODCO  IPO.

     The increase in this segment's depreciation expense resulted primarily from
the  consolidation  of  Delta  Towing,  partially  offset  by  a  reduction  in
depreciation  resulting  from the write down to fair market value of five jackup
rigs  removed  from  active  drilling  service  in  2003.

     During  the  three  months  ended  June  30,  2003,  we  recorded  non-cash
impairment  charges in this segment of $11.6 million associated with the removal
of  five jackup rigs from drilling service and the write down in the value of an
investment  in  a  joint venture to fair value. The determination of fair market
value  was  based on third party valuations, in the case of the jackup rigs, and
management's  assessment of fair value, in the case of the investment in a joint
venture,  where  third  party  valuations  were  not  available.


                                       33
<PAGE>
     During  the  three  months ended June 30, 2004, this segment recognized net
gains  of  $1.9  million  primarily  related to the sale of three marine support
vessels  by  Delta  Towing  and  the  sale  of  other  assets.

<TABLE>
<CAPTION>
Total Company Results of Operations

                                                           Three Months Ended
                                                                 June 30,
                                                          ------------------------
                                                             2004         2003       Change   % Change
                                                          ----------  ------------  --------  ---------
<S>                                                       <C>         <C>           <C>       <C>
                                                                   (In millions, except % change)

General and Administrative Expense                        $    14.0   $      14.9   $  (0.9)       (6)%
Other (Income) Expense, net
  Equity in earnings of joint ventures                         (3.7)         (1.8)     (1.9)        N/M
  Interest income                                              (1.9)         (5.8)      3.9       (67)%
  Interest expense                                             42.6          52.8     (10.2)      (19)%
  Loss on retirement of debt                                      -          15.7     (15.7)        N/M
  Impairment loss on note receivable from related party           -          21.3     (21.3)        N/M
  Other, net                                                    1.1           2.7      (1.6)      (59)%
Income Tax Expense (Benefit)                                   19.9         (20.8)     40.7         N/M
Minority Interest                                              (2.2)          0.2      (2.4)        N/M
<FN>
_________________________
"N/M" means not meaningful
</TABLE>

     The  decrease  in  general  and  administrative  expense  was  primarily
attributable  to  a  reduction  of  costs related to employee benefits and lower
advertising  and  public  relations  fees,  partially  offset  by  increases  in
professional  fees  related  to compliance with corporate governance regulations
effective  for  2004.

     Equity  in  earnings of joint ventures increased approximately $4.1 million
primarily  related  to  our  50 percent share of earnings from Overseas Drilling
Limited,  which  owns the drillship Joides Resolution, combined with the absence
of our share of losses from Delta Towing in 2004 due to the consolidation of the
joint  venture  at  December  31,  2003  as  a result of the adoption of FIN 46.
Offsetting  these increases was a decrease in equity in earnings of $2.3 million
related to our consolidation of DD LLC and DDII LLC in 2003, which resulted from
the  completion  of  the  buyout  of  Conoco's  share  of  the  joint  ventures.

     The  decrease in interest income was primarily due to a decrease in average
cash  balances for 2004 compared to 2003 as cash was utilized for debt reduction
and  capital  expenditures,  which resulted in a reduction of interest income of
$2.3  million.  Additional  decreases  resulted from the absence in 2004 of $1.7
million of interest earned in the second quarter of 2003 on the notes receivable
from  Delta  Towing,  which was consolidated at December 31, 2003 as a result of
the  adoption  of  FIN  46.

     The decrease in interest expense was attributable to reductions in interest
expense  of  $11.5  million  associated  with debt that was redeemed, retired or
repurchased  during  or  subsequent  to  the  second  quarter of 2003. Partially
offsetting  this  decrease was the issuance of new debt subsequent to the second
quarter  of  2003,  which  resulted  in  an increase in interest expense of $1.7
million.

     During  the three months ended June 30, 2003, we recognized a $15.7 million
loss  related  to the repurchase of $838.6 million aggregate principal amount of
our  Zero  Coupon  Convertible  Debentures  due  May 2020 and the repurchase and
retirement  of  the $50.0 million principal amount 9.41% Nautilus Class A2 Notes
due  May  2005.

     During  the three months ended June 30, 2003, we recognized a $21.3 million
impairment  loss  on  our  note  receivable  from  Delta  Towing.


                                       34
<PAGE>
     We  recognized  a  $2.3 million loss in other, net in the second quarter of
2003  relating  to  the  effect of foreign currency exchange rate changes on our
monetary  assets  and  liabilities denominated in Venezuelan bolivars, partially
offset  by  proceeds  received  from  the  sale  of  a patent with no comparable
activity  for  the  same  period  in  2004.

     We  operate  internationally  and provide for income taxes based on the tax
laws and rates in the countries in which we operate and earn income. There is no
expected  relationship  between the provision for income taxes and income before
income  taxes.  The  annual  effective  tax  rate  for  2004  is estimated to be
approximately  35  percent  of  earnings before TODCO IPO-related items, loss on
debt  retirements  and  gains on significant asset sales. The effective tax rate
increased  from approximately 27 percent estimated at March 31, 2004 as a result
of  developments in the second quarter on certain international tax disputes, an
increase in the valuation allowance established at the time of the TODCO IPO and
changes in the expected amount and geographical concentration of taxable income.
The  catch-up  effect  of  the  increase  in  the  annual  effective tax rate, a
reduction  in  earnings  of $4.6 million, was reflected in the second quarter of
2004  resulting in an effective tax rate of 45 percent on earnings for the three
months  ended June 30, 2004, excluding the sale of the semisubmersible rig Sedco
602.  The  three  months  ended  June 30, 2003 included a foreign tax benefit of
$14.6  million attributable to the favorable resolution of a non-U.S. income tax
liability  and  income tax benefits resulting from non-cash impairments and loss
on  debt  retirements.  At  June 30, 2003, we estimated the annual effective tax
rate  for  2003  to be approximately 38 percent of earnings before non-cash note
receivable  and  other  asset impairments and loss on debt retirements. The rate
increased  from  an  estimated  annual  effective  tax  rate of approximately 20
percent  at  March  31, 2003, due to a change in the amount and mix of estimated
earnings  for  the year. As a result of the catch-up effect of the change in the
annual  effective  tax  rate,  earnings for the three months ended June 30, 2003
were  reduced  by  $10.7  million.

     The  increase  in  minority  interest  was  primarily  attributable  to the
minority  interest  owners'  share  of  TODCO  resulting  from  the  IPO.

     SIX MONTHS ENDED JUNE 30, 2004 COMPARED TO SIX MONTHS ENDED JUNE 30, 2003

     Following  is  an  analysis  of  our  Transocean Drilling segment and TODCO
segment  operating  results,  as  well  as  an  analysis  of  income and expense
categories  that  we  have  not  allocated  to  our  two  segments.

<TABLE>
<CAPTION>
Transocean Drilling Segment

                                                                   Six Months Ended
                                                                       June 30,
                                                             -----------------------------
                                                                  2004            2003         Change        % Change
                                                             ---------------  ------------  -------------  ------------
<S>                                                          <C>              <C>           <C>            <C>
                                                                  (In millions, except day amounts and percentages)

Operating days                                                       11,731        11,769            (38)         N/M
Utilization (a)                                                          68%           68%           N/A          N/M
Average dayrate (b)                                          $       89,700   $    90,300   $       (600)          (1)%

Contract drilling revenues                                   $      1,052.1   $   1,062.6   $      (10.5)          (1)%
Other revenues                                                         78.6          48.6           30.0            62%
                                                             ---------------  ------------  -------------  ------------
                                                                    1,130.7       1,111.2           19.5             2%
Operating and maintenance expense                                     671.3         671.4           (0.1)          N/M
Depreciation                                                          216.4         208.0            8.4             4%
Impairment loss on long-lived assets                                      -           5.2           (5.2)          N/M
Gain from sale of assets, net                                         (23.0)         (1.6)         (21.4)          N/M
Gain from TODCO initial public offering                               (39.4)            -          (39.4)          N/M
                                                             ---------------  ------------  -------------  ------------
Operating income before general and administrative expense   $        305.4   $     228.2   $       77.2            34%
                                                             ===============  ============  =============  ============
<FN>
_________________
"N/A" means not applicable


                                       35
<PAGE>
"N/M" means not meaningful

(a)     Utilization  is  defined  as the total actual number of revenue earning days as a percentage of total number of
        calendar  days  in  the  period.
(b)     Average  dayrate  is  defined  as  contract  drilling  revenue  earned  per  revenue  earning  day.
</TABLE>

     This  segment's  contract  drilling  revenues  were  negatively impacted by
approximately  $88.6  million  due  to  a decline in average dayrates and by the
release  of  a  provision  of  $3.3  million  due to a favorable settlement of a
contract  dispute  related  to  penalties  on  the  Peregrine I during the first
quarter  of  2003  with  no  comparable  benefit  for  the  same period in 2004.
Partially  offsetting  these  decreases were revenues for the full six months in
2004 on the Discoverer Enterprise, which was inactive for the latter part of the
second quarter of 2003 due to a riser separation incident, and revenues from the
consolidation  of  DDII  LLC  and  DD LLC, which occurred late in the second and
fourth  quarters  of 2003, respectively. Additionally, a labor strike in Nigeria
and the Peregrine I electrical fire during the second quarter of 2003 negatively
impacted  revenues  during that period as compared to 2004. These items resulted
in  a  positive  impact  of  $81.4  million  over  the  prior  year.

     Other revenues for the six months ended June 30, 2004 included increases of
$37.9  million  primarily  related to integrated services, partially offset by a
decrease  of  $8.7  million  from client reimbursable revenue and the absence of
revenue from management fees as a result of the consolidation of DDII LLC and DD
LLC  late  in  the  second  and  fourth  quarters,  respectively,  of  2003.

     The  decrease  in  this  segment's  operating  and maintenance expenses was
primarily  due to approximately $41.7 million related to decreased activity, the
settlement  of  the Discoverer Enterprise May 2003 riser incident, the favorable
insurance  settlement  related  to the Peregrine I riser incident, a decrease in
insurance expense and the favorable settlement of a turnkey dispute during 2004.
Additional  decreases of approximately $4.8 million resulted from costs incurred
in  2003 related to the Peregrine I electrical fire and the Nigeria labor strike
with  no  comparable  activity  in 2004. Largely offsetting these decreases were
increased  operating  and  maintenance  expenses  of approximately $39.8 million
related primarily to higher integrated services activity, the Deepwater Frontier
and Deepwater Pathfinder as a result of the consolidation of DDII LLC and DD LLC
late  in  the  second  and  fourth  quarters,  respectively,  of 2003, a loss on
retirement  and  higher  provisions  for  local tax matters in 2004.  Additional
increases  of  approximately $6.7 million resulted from favorable litigation and
turnkey  settlements  during  2003  with  no  comparable  activity  during 2004.

     The increase in this segment's depreciation expense resulted primarily from
$6.5  million  of  additional  depreciation  expense  related  to  the Deepwater
Frontier  and  Deepwater Pathfinder as a result of the late December 2003 payoff
of  the  synthetic  lease  financing  arrangements  by  DDII  LLC  and  DD  LLC,
respectively,  which  were  consolidated late in the second and fourth quarters,
respectively,  of  2003.

     During  the six months ended June 30, 2003, we recorded non-cash impairment
charges  in this segment of $5.2 million associated with the removal of two rigs
from drilling service and the value assigned to leases on oil and gas properties
that  we  intended  to  discontinue.  The determination of fair market value was
based  on  an  offer  from  a  potential buyer, in the case of the two rigs, and
management's  assessment of fair value, in the case of the leases on oil and gas
properties,  where  third  party  valuations  were  not  available.

     During  the  six  months  ended  June 30, 2004, this segment recognized net
gains  of $23.0 million related to the sale of the semisubmersible rig Sedco 602
and  the  sale  of other assets. During the six months ended June 30, 2003, this
segment  recognized  net gains of $1.6 million related to the sale of the jackup
rig  RBF 160, the settlement of an insurance claim and the sale of other assets.


                                       36
<PAGE>
<TABLE>
<CAPTION>
TODCO Segment

                                                               Six Months Ended
                                                                   June 30,
                                                           -----------------------------
                                                                2004            2003         Change        % Change
                                                           ---------------  ------------  -------------  ------------
<S>                                                        <C>              <C>           <C>            <C>
                                                                  (In millions, except day amounts and percentages)

Operating days                                                      5,026         5,541           (515)          (9)%
Utilization (a)                                                        39%           40%           N/A            N/M
Average dayrate (b)                                        $       25,900   $    18,000   $      7,900            44%

Contract drilling revenues                                 $        130.3   $      99.6   $        0.7            31%
Other revenues                                                       24.2           9.1           15.1            N/M
                                                           ---------------  ------------  -------------  ------------
                                                                    154.5         108.7           45.8            42%
Operating and maintenance                                           147.3         129.2           18.1            14%
Depreciation                                                         48.1          46.3            1.8             4%
Impairment loss on long-lived assets                                    -          11.6          (11.6)           N/M
Gain from sale of assets, net                                        (4.6)         (0.4)          (4.2)           N/M
                                                           ---------------  ------------  -------------  ------------
Operating loss before general and administrative expense   $        (36.3)  $     (78.0)  $       41.7          (53)%
                                                           ===============  ============  =============  ============
<FN>
_________________
"N/A" means not applicable
"N/M" means not meaningful

(a)  Utilization  is defined as the total actual number of revenue earning days as a percentage of total number of
     calendar  days  in  the  period.
(b)  Average  dayrate  is  defined  as  contract  drilling  revenue  earned  per  revenue  earning  day.
</TABLE>

     This  segment's contract drilling revenues increased by approximately $24.4
million  due  to  an increase in average dayrates, partially offset by decreased
utilization  of  approximately  $10.9  million.  Additional  increases  of
approximately  $17.3  million  resulted  from  increased  average  dayrates  and
utilization  related  to  operations of three jackup rigs in Venezuela (THE 156)
and Mexico (THE 205 and THE 206) after being transferred from the Gulf of Mexico
during  the  fourth  quarter  of  2003.

     Other revenues for the six months ended June 30, 2004 included increases of
approximately  $15.1  million  related  to  the consolidation of Delta Towing at
December  31,  2003  and  client  reimbursable  revenue.

     The  increase  in  this  segment's  operating  and  maintenance expense was
primarily  due  to  approximately  $11.9  million  of  costs associated with the
consolidation  of  Delta  Towing at December 31, 2003, $9.4 million of operating
and  maintenance  expense  related  to  the  operations  of three jackup rigs in
Venezuela  (THE  156)  and  Mexico (THE 205 and THE 206) after being transferred
from  the Gulf of Mexico and $9.4 million of higher compensation expense related
to  stock  option  and  restricted  stock grants as the result of the TODCO IPO.
Partially  offsetting  the  above  increases  were  decreases  primarily  due to
approximately  $11.8  million of costs associated with the well control incident
on  inland  barge  Rig  62  during  2003  and  a  decrease in insurance expense.

     The increase in this segment's depreciation expense resulted primarily from
$2.6  million of additional depreciation expense related to the consolidation of
Delta Towing, partially offset by a reduction in depreciation resulting from the
write down to fair market value of five jackup rigs removed from active drilling
service  in  2003.

     During  the six months ended June 30, 2003, we recorded non-cash impairment
charges  in  this  segment  of $11.6 million associated with the removal of five
jackup  rigs  from  drilling  service  and  the  write  down  in the value of an
investment  in  a  joint venture to fair value. The determination of fair market
value  was  based on third party valuations, in the case of the jackup rigs, and
management's  assessment of fair value, in the case of the investment in a joint
venture,  where  third  party  valuations  were  not  available.


                                       37
<PAGE>
     During  the  six  months  ended  June 30, 2004, this segment recognized net
gains  of  $4.6  million  primarily  related  to the sale of four marine support
vessels  by Delta Towing, as well as the sale of other assets and the settlement
of  an  October  2000  insurance  claim  for  one  of  our  jackup  rigs.

<TABLE>
<CAPTION>
Total Company Results of Operations

                                                             Six Months Ended
                                                                 June 30,
                                                          -----------------------
                                                             2004        2003       Change   % Change
                                                          ----------  -----------  --------  ---------
<S>                                                       <C>         <C>          <C>       <C>
                                                                  (In millions, except % change)

General and Administrative Expense                        $    29.1   $     28.8   $   0.3          1%
Other (Income) Expense, net
  Equity in earnings of joint ventures                         (6.0)        (5.4)     (0.6)        11%
  Interest income                                              (4.0)       (12.7)      8.7         69%
  Interest expense                                             90.0        105.4     (15.4)      (15)%
  Loss on retirement of debt                                   28.1         15.7      12.4         79%
  Impairment loss on note receivable from related party           -         21.3     (21.3)       N/M
  Other, net                                                   (0.3)         3.3      (3.6)       N/M
Income Tax Expense (Benefit)                                   67.9         (9.0)     76.9        N/M
Minority Interest                                              (6.4)         0.1      (6.5)       N/M
<FN>
_________________________
"N/M" means not meaningful
</TABLE>

     The  increase  in  general  and  administrative  expense  was  primarily
attributable  to  costs  related  to  compliance  with  corporate  governance
regulations  effective  for  2004.

     Equity  in  earnings of joint ventures increased approximately $6.1 million
primarily  related  to  our  50 percent share of earnings from Overseas Drilling
Limited,  which  owns the drillship Joides Resolution, combined with the absence
of  our  share of losses from Delta Towing in the six months ended June 30, 2003
due  to  the consolidation of the joint venture at December 31, 2003 as a result
of  the adoption of FIN 46.  Offsetting these increases was a decrease in equity
in  earnings of $5.6 million related to our consolidation of DD LLC and DDII LLC
in  2003,  which  resulted  from the completion of the buyout of ConocoPhillips'
share  of  the  joint  ventures.

     The  decrease  in  interest  income  was primarily related to a decrease in
average  cash  balances  for 2004 compared to 2003 as cash was utilized for debt
reduction  and  capital  expenditures, which resulted in a reduction of interest
income  of $5.0 million.  Additional decreases resulted from the absence in 2004
of  $3.3  million  of interest earned in 2003 on the notes receivable from Delta
Towing,  which was consolidated at December 31, 2003 as a result of the adoption
of  FIN  46.

     The decrease in interest expense was attributable to reductions in interest
expense  of  $24.5  million  associated  with debt that was redeemed, retired or
repurchased  during  or  subsequent  to  the  six  months  ended  June 30, 2003.
Partially  offsetting  these  decreases  was  the  termination  of  our fixed to
floating  interest  rate swaps in the first quarter of 2003, which resulted in a
net increase in interest expense of $4.8 million (see "-Derivative Instruments")
and  the  issuance of new debt subsequent to the six months ended June 30, 2003,
which  resulted in an increase in interest expense of $3.6 million. In addition,
we  received  a  refund  of  interest from a taxing authority that resulted in a
reduction  of  interest expense of $0.8 million in the six months ended June 30,
2003,  with  no  comparable  activity  for  the  same  period  in  2004.

     During  the  six  months ended June 30, 2004, we recognized a $28.1 million
loss  related  to  the redemption of $289.8 million principal amount outstanding
9.5%  Senior Notes due December 2008 (see "-Significant Events"). During the six
months  ended  June  30, 2003, we recognized a $15.7 million loss related to the
repurchase  of  $838.6


                                       38
<PAGE>
million aggregate principal amount of our Zero Coupon Convertible Debentures due
May 2020 and the repurchase and retirement of the $50.0 million principal amount
9.41%  Nautilus  Class  A2  Notes  due  May  2005.

     During  the  six  months ended June 30, 2003, we recognized a $21.3 million
impairment  loss  on  our  notes  receivable  from  Delta  Towing.

     We recognized a $3.3 million favorable change in other, net relating to the
effect  of  foreign  currency  exchange  rate changes on our monetary assets and
liabilities  denominated  in  non-U.S.  currencies, partially offset by proceeds
received  from  the  sale  of  a patent with no comparable activity for the same
period  in  2004.

     We  operate  internationally  and provide for income taxes based on the tax
laws and rates in the countries in which we operate and earn income. There is no
expected  relationship  between the provision for income taxes and income before
income taxes. During the six months ended June 30, 2004, we recorded a valuation
allowance  of  approximately  $31.0  million  related  to  the  TODCO  IPO  (see
"-Significant  Events").  The  six months ended June 30, 2003 included a foreign
tax  benefit  of  $14.6  million  attributable  to the favorable resolution of a
non-U.S.  income  tax  liability and income tax benefits resulting from non-cash
impairments and loss on debt retirements, partially offset by an increase in the
estimated  annual effective tax rate for the six months ended June 30, 2003. The
annual  effective  tax  rate was estimated to be approximately 35 percent during
2004  on  earnings  before TODCO IPO-related items, loss on debt retirements and
gains  on  significant  asset  sales compared to approximately 38 percent during
2003 on earnings before non-cash note receivable and other asset impairments and
loss  on  debt  retirements.

     The  increase  in  minority  interest  was  primarily  attributable  to the
minority  interest  owners'  share  of  TODCO  resulting  from  the  IPO.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

     Our  discussion  and  analysis  of  our  financial condition and results of
operations  are based upon our condensed consolidated financial statements. This
discussion  should be read in conjunction with disclosures included in the notes
to  our  condensed  consolidated  financial  statements  related  to  estimates,
contingencies and new accounting pronouncements. Significant accounting policies
are  discussed  in  Note  2  to  our condensed consolidated financial statements
included elsewhere and in Note 2 to our consolidated financial statements in our
Annual Report on Form 10-K for the year ended December 31, 2003. The preparation
of  these  financial statements requires us to make estimates and judgments that
affect  the  reported  amounts  of  assets,  liabilities, revenues, expenses and
related  disclosure  of contingent assets and liabilities. On an on-going basis,
we  evaluate  our estimates, including those related to bad debts, materials and
supplies  obsolescence,  investments,  property and equipment, intangible assets
and  goodwill,  income  taxes,  workers'  insurance,  pensions  and  other
post-retirement  and employment benefits and contingent liabilities. We base our
estimates  on  historical  experience  and on various other assumptions that are
believed to be reasonable under the circumstances, the results of which form the
basis  for  making judgments about the carrying values of assets and liabilities
that are not readily apparent from other sources. Actual results may differ from
these  estimates  under  different  assumptions  or  conditions.

     For  a discussion of the critical accounting policies and estimates that we
use  in  the preparation of our condensed consolidated financial statements, see
"Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations" in our Annual Report on Form 10-K for the year ended December 31,
2003.  There  have  been  no  material  changes to these policies during the six
months  ended  June  30,  2004. These policies require significant judgments and
estimates  used  in  the  preparation  of our consolidated financial statements.
Management  has  discussed  each  of  these  critical  accounting  policies  and
estimates  with  the  Audit  Committee  of  the  Board  of  Directors.

RETIREMENT PLANS AND OTHER POSTEMPLOYMENT BENEFITS

     Defined  Benefit  Pension  Plans  - We have several defined benefit pension
plans,  both  funded  and  unfunded,  covering  substantially all U.S. employees
except  for  TODCO  employees.  We also have several defined benefit plans,


                                       39
<PAGE>
both  funded  and  unfunded, that cover Norway employees, Nigeria employees, and
various current and former employees covered under certain frozen plans acquired
in  connection  with  the  R&B  Falcon  merger.

     For  the  funded plans, our funding policy consists of reviewing the funded
status  of these plans annually and contributing an amount at least equal to the
minimum  contribution required under the Employee Retirement Income Security Act
of  1974 (ERISA) or other applicable funding regulations. Employer contributions
to  the  funded  plan  are  based  on  actuarial computations that establish the
minimum  contribution  required  under  ERISA  and  the  maximum  deductible
contribution  for  income  tax  purposes.

     We  expect to contribute approximately $10.0 million to our defined benefit
pension  plans in 2004, which will be funded from our cash flow from operations.
As of June 30, 2004, $1.0 million in contributions have been made to the defined
benefit  pension  plans.

     Postretirement  Benefits  Other  Than  Pensions  - We have several unfunded
contributory  and  noncontributory  postretirement  benefit  plans  covering
substantially  all of our Transocean Drilling segment U.S. employees. Funding of
benefit  payments  for  plan  participants  will  be made as costs are incurred.

     In  December  2003,  the  Medicare  Prescription  Drug,  Improvement  and
Modernization  Act of 2003 (the "Act") was signed into law. The Act introduced a
prescription  drug benefit under Medicare (Medicare Part D) as well as a federal
subsidy  to  sponsors  of  retiree  health  care  benefit  plans  that provide a
prescription  drug  benefit  that is at least actuarially equivalent to Medicare
Part  D.  The  Act  introduces  two new features to Medicare that employers must
consider  in  determining  the  effect  of  the  Act  on  their  accumulated
postretirement  benefit  obligation  (''APBO'') and net periodic post retirement
benefit  cost:  (i) a subsidy based on 28 percent of an individual beneficiary's
annual prescription drug costs between $250 and $5,000, and (ii) the opportunity
for  a  retiree  to  obtain  a  prescription  drug  benefit  under  Medicare. In
accordance  with  SFAS  106,  Employers'  Accounting for Postretirement Benefits
Other  Than  Pensions,  employers  are  required  to  consider presently enacted
changes  in  relevant  laws  in  current  period  measurements of postretirement
benefit  costs  and  the  APBO.  As  a  result,  the  APBO  and  net  periodic
postretirement  benefit  costs  for future periods should reflect the effects of
the Act. At present, detailed regulation necessary to implement the Act have not
been  issued,  including  those that would specify the manner in which actuarial
equivalency  must  be determined, the evidence required to demonstrate actuarial
equivalency  and  the documentation requirements necessary to be entitled to the
subsidy.

     In  May  2004,  the  FASB  staff  issued FASB Staff Position ("FSP") 106-2,
Accounting  and  Disclosure  Requirements  Related  to the Medicare Prescription
Drug, Improvement and Modernization Act of 2003. FSP 106-2, which supercedes the
same  titled  FSP 106-1, considers the effect of the two new features introduced
in  the  Act  in  determining  our APBO and net periodic post retirement benefit
cost.  The  effect  on the APBO will be accounted for as an actuarial gain to be
amortized  into  income  over  the  average  remaining  service  period  of plan
participants.  Companies  may  elect  to  defer  accounting  for this benefit or
attempt  to  reflect  the  best  estimate  of the impact of the Act on their net
periodic  costs  currently. The FSP is effective for the first interim or annual
period beginning after June 15, 2004. We have chosen to defer accounting for the
benefit  and  will implement these requirements effective July 1, 2004 using the
prospective  method outlined in FSP 106-2. The adoption of these requirements is
not expected to have a material impact on our consolidated financial position or
results  of  operations. As a result of our election to defer the implementation
of  the  FSP, our measures of APBO and net periodic postretirement benefit costs
included  in  the  condensed  consolidated  financial  statements  herein do not
reflect  the  effects  of  the  Act.


                                       40
<PAGE>
SALE/LEASEBACK TRANSACTION

     We  lease the drillship M. G. Hulme, Jr. from Deep Sea Investors, L.L.C., a
special  purpose  entity  formed by several leasing companies to acquire the rig
from  one  of our subsidiaries in November 1995 in a sale/leaseback transaction.
We  are  obligated  to  pay  rent  of approximately $13 million per year through
November  2005.  At  the termination of the lease, we may purchase the rig for a
maximum  amount  of  approximately  $35.7 million. Effective September 2002, the
lease  neither  requires  that  collateral be maintained nor contains any credit
rating  triggers.

     Effective  December  31, 2003, we adopted and applied the provisions of FIN
46,  Consolidation  of Variable Interest Entities, as revised December 31, 2003,
for  all  variable  interest  entities.  FIN  46  requires  the consolidation of
variable  interest  entities  in  which  an enterprise absorbs a majority of the
entity's  expected losses, receives a majority of the entity's expected residual
returns,  or  both,  as  a  result  of ownership, contractual or other financial
interests  in the entity. Because the sale/leaseback agreement is with an entity
in  which  we  have  no  direct  investment,  we are not entitled to receive the
financial statements of the leasing entity and the equity holders of the leasing
company will not release the financial statements or other financial information
to  us  in  order  for  us  to make the determination of whether the entity is a
variable  interest entity. In addition, without the financial statements, we are
unable  to determine if we are the primary beneficiary of the entity and, if so,
what  we  would  consolidate.  We  have  no  exposure to loss as a result of the
sale/leaseback  agreement.  We  currently  account  for  the  lease  of  this
semisubmersible  drilling  rig  as  an  operating  lease.

NEW ACCOUNTING PRONOUNCEMENTS

     In  April  2004, the FASB issued FSP 129-1, Disclosure of Information about
Capital  Structure,  Relating  to  Contingently  Convertible  Securities,  which
applies to all contingently convertible securities and became effective the date
of  issue.  The FSP requires disclosure of the nature of the contingency and the
potential  impact  of  conversion  on the financial statements, particularly the
impact  on  earnings per share, and whether the securities have been included in
the  entity's  calculation of diluted earnings per share.  The implementation of
this  FSP  did  not  have  an  effect  on  our  condensed consolidated financial
statements  and  related notes thereto as our disclosures are in accordance with
the  disclosure  requirements  as  stated  in  this  FSP.

FORWARD-LOOKING INFORMATION

     The statements included in this quarterly report regarding future financial
performance  and  results  of  operations  and  other  statements  that  are not
historical  facts  are  forward-looking statements within the meaning of Section
27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of  1934.  Statements  to  the  effect  that  we  or  management  "anticipates,"
"believes,"  "budgets," "estimates," "expects," "forecasts," "intends," "plans,"
"predicts,"  or "projects" a particular result or course of events, or that such
result  or  course  of  events  "could," "might," "may," "scheduled" or "should"
occur,  and  similar  expressions, are also intended to identify forward-looking
statements. Forward-looking statements in this quarterly report include, but are
not limited to, statements involving contract commencements, revenues, expenses,
commodity  prices,  customer  drilling  programs, supply and demand, utilization
rates,  dayrates,  planned  shipyard  projects  and  rig mobilizations, expected
downtime, future activity in the deepwater, mid-water and the shallow and inland
water  market  segments,  market  outlook for our various geographical operating
sectors,  rig  classes  and business segments, plans to dispose of our remaining
interest in TODCO, the valuation allowance for deferred net tax assets of TODCO,
intended  reduction  of  debt,  planned  asset  sales,  timing  of  asset sales,
including  the  Sedco 600, proceeds from asset sales, the effect and duration of
the  Norway  strike,  the effect of the Trident 20 fire, our effective tax rate,
the  purchase  of  the  M.G.  Hulme,  Jr.,  changes  in  tax  laws, treaties and
regulations, our other expectations with regard to market outlook, operations in
international  markets,  expected  capital  expenditures, results and effects of
legal  proceedings  and  governmental  audits  and  assessments,  adequacy  of
insurance,  liabilities  for  tax  issues, liquidity, cash flow from operations,
adequacy  of  cash  flow  for  our  obligations,  effects of accounting changes,
pension  plan  contributions  and  the  timing and cost of completion of capital
projects.  Such  statements  are  subject  to  numerous risks, uncertainties and
assumptions,  including,  but  not  limited  to,  those  described  in  "Item 7.
Management's  Discussion  and  Analysis  of  Financial  Condition and Results of
Operations Risk Factors" included in our Annual Report on Form 10-K for the year
ended  December  31,  2003, the adequacy of sources of liquidity, the effect and
results  of  litigation, audits and contingencies and other factors discussed in
this  annual  report



                                       41
<PAGE>
and in our other filings with the SEC, which are available free of charge on the
SEC's website at www.sec.gov. Should one or more of these risks or uncertainties
materialize,  or  should  underlying assumptions prove incorrect, actual results
may  vary  materially  from  those  indicated.  All  subsequent written and oral
forward-looking statements attributable to us or to persons acting on our behalf
are  expressly  qualified  in  their  entirety  by  reference to these risks and
uncertainties.  You  should  not  place  undue  reliance  on  forward-looking
statements.  Each  forward-looking  statement  speaks only as of the date of the
particular  statement,  and  we  undertake  no  obligation to publicly update or
revise  any  forward-looking  statements.


                                       42
<PAGE>
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

INTEREST RATE RISK

     Our exposure to market risk for changes in interest rates relates primarily
to  our  long-term  and  short-term  debt  obligations. The table below presents
scheduled  debt  maturities and related weighted-average interest rates for each
of  the  12-month periods ending June 30 relating to debt obligations as of June
30,  2004. Weighted-average variable rates are based on London Interbank Offered
Rate  in  effect  at  June  30,  2004,  plus  applicable  margins.

     At June 30, 2004 (in millions, except interest rate percentages):

<TABLE>
<CAPTION>
                            Scheduled Maturity Date (a) (b)                                      Fair Value
                           --------------------------------------------------------------------  -----------
                            2005     2006     2007      2008     2009    Thereafter     Total     06/30/04
                           -------  -------  -------  --------  ------  ------------  ---------  -----------
Total debt
<S>                        <C>      <C>      <C>      <C>       <C>     <C>           <C>        <C>
  Fixed Rate               $392.3   $400.0   $100.0   $ 269.0   $10.2   $   1,750.0   $2,921.5   $   3,178.8
    Average interest rate     6.8%     1.5%     7.5%      6.7%    9.5%          7.2%       6.3%
  Variable Rate            $    -   $    -   $    -   $     -   $50.0   $         -   $   50.0   $      50.0
    Average interest rate       -        -        -         -     1.7%            -        1.7%
<FN>
__________________________
(a)  Maturity  dates  of  the  face value of our debt assume the put options on 1.5% Convertible Debentures,
     7.45%  Notes  and  the  Zero Coupon Convertible Debentures will be exercised in May 2006, April 2007 and May
     2008,  respectively.
(b)  Expected  maturity  amounts  are  based  on  the  face  value  of  debt.
</TABLE>

     At  June 30, 2004, we had approximately $50.0 million of variable rate debt
at  face  value  (approximately  1.7  percent of total debt at face value). This
variable  rate  debt  represented  revolving credit bank debt. Given outstanding
amounts as of that date, a one percent rise in interest rates would result in an
additional  $0.4  million in interest expense per year. Offsetting this, a large
part  of  our cash investments would earn commensurately higher rates of return.
Using  June  30, 2004 cash investment levels, a one percent increase in interest
rates  would  result in approximately $2.4 million of additional interest income
per  year.

FOREIGN EXCHANGE RISK

     Our  international  operations expose us to foreign exchange risk. We use a
variety  of  techniques  to  minimize the exposure to foreign exchange risk. Our
primary  foreign exchange risk management strategy involves structuring customer
contracts  to  provide for payment in both U.S. dollars, which is our functional
currency,  and local currency. The payment portion denominated in local currency
is  based on anticipated local currency requirements over the contract term. Due
to  various factors, including local banking laws, other statutory requirements,
local currency convertibility and the impact of inflation on local costs, actual
foreign  exchange  needs  may  vary  from  those  anticipated  in  the  customer
contracts,  resulting in partial exposure to foreign exchange risk. Fluctuations
in  foreign  currencies  typically  have  not  had  a material impact on overall
results.  In  situations  where  payments  of  local currency do not equal local
currency  requirements,  foreign  exchange  derivative instruments, specifically
foreign  exchange  forward  contracts or spot purchases, may be used to mitigate
foreign  currency  risk.  We  do  not  enter  into  derivative  transactions for
speculative  purposes.  At  June  30,  2004,  we  had  no  open foreign exchange
derivative  contracts.


                                       43
<PAGE>
ITEM 4. CONTROLS AND PROCEDURES

     In  accordance with Exchange Act Rules 13a-15 and 15d-15, we carried out an
evaluation,  under  the  supervision  and  with the participation of management,
including  our  Chief  Executive  Officer  and  Chief  Financial Officer, of the
effectiveness  of  our  disclosure  controls and procedures as of the end of the
period  covered  by  this  report. Based on that evaluation, our Chief Executive
Officer  and  Chief Financial Officer concluded that our disclosure controls and
procedures  were  effective  as of June 30, 2004 to provide reasonable assurance
that  information  required  to  be  disclosed in our reports filed or submitted
under  the  Exchange  Act is recorded, processed, summarized and reported within
the time periods specified in the Securities and Exchange Commission's rules and
forms.

     There  has been no change in our internal controls over financial reporting
that  occurred  during  the three months ended June 30, 2004 that has materially
affected,  or  is  reasonably likely to materially affect, our internal controls
over  financial  reporting.


                                       44
<PAGE>
PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

     We  have  certain  actions  or  claims  pending  that  have been previously
discussed  and  reported  in  our  Annual Report on Form 10-K for the year ended
December  31,  2003 and our other reports filed with the Securities and Exchange
Commission.  There  have  been  no  material  developments  in  these previously
reported  matters.  We  are involved in a number of other lawsuits, all of which
have  arisen  in  the  ordinary  course  of our business. We do not believe that
ultimate  liability,  if  any,  resulting from any such other pending litigation
will  have  a  material adverse effect on our business or consolidated financial
position.  We  cannot predict with certainty the outcome or effect of any of the
litigation  matters  specifically  described  above or of any such other pending
litigation. There can be no assurance that our beliefs or expectations as to the
outcome  or  effect of any lawsuit or other litigation matter will prove correct
and  the  eventual  outcome  of  these  matters  could  materially  differ  from
management's  current  estimates.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     At  the  Annual  General  Meeting  of Transocean Inc. held on May 13, 2004,
275,561,965  shares  were  represented  in person or by proxy out of 320,751,973
shares  outstanding  and  entitled to vote as of the record date, constituting a
quorum.  The  matters  submitted  to a vote of shareholders, as set forth in the
Company's  Proxy Statement relating to the meeting, and the corresponding voting
results  were  as  follows:

(i)  With  respect to the election of Class II Director nominees as set forth in
     the Company's Proxy Statement relating to the meeting, the following number
     of  votes  were  cast:

<TABLE>
<CAPTION>
               NAME OF NOMINEE FOR               WITHHELD/
               CLASS II DIRECTOR        FOR       ABSTAIN
               -------------------------------------------
<S>                                 <C>          <C>
               Robert L. Long       268,544,067  7,017,898
               Martin B. McNamara   270,326,740  5,235,225
               Robert M. Sprague    270,263,399  5,298,566
               J. Michael Talbert   267,857,741  7,704,224
</TABLE>

(ii) With  respect to the amendment of the Company's Long-Term Incentive Plan to
     increase  the  number of ordinary shares reserved for issuance to employees
     under  the  plan  from  18,900,000  to  22,900,000,  increase the number of
     ordinary  shares  that  may  be  issued  to  employees  under  the  plan as
     restricted  shares  or  deferred units from 2,000,000 to 6,000,000, provide
     for  the  award  of  deferred  units,  replace  automatic awards to outside
     directors  with  discretionary  awards  that  are  determined by our board,
     restate the performance criteria specified in the plan for certain types of
     awards,  allow  net  share  counting  in  determining  the number of shares
     available  for  issuance  under the plan and modify other provisions of the
     plan  as  described  in  the Proxy Statement, the following number of votes
     were  cast:

<TABLE>
<CAPTION>
                                 AGAINST/       EXCEPTIONS/    BROKER
               FOR          AUTHORITY WITHHELD    ABSTAIN    NON-VOTES
               --------------------------------------------------------
<S>                         <C>                 <C>          <C>
               211,304,002      15,726,837       1,743,430    46,787,696
</TABLE>

(iii) With respect to the approval of the Company's appointment of Ernst & Young
      LLP as  independent  auditors for 2004, the following number of votes were
      cast:

<TABLE>
<CAPTION>
                                 AGAINST/       EXCEPTIONS/   BROKER
               FOR          AUTHORITY WITHHELD    ABSTAIN    NON-VOTES
               -------------------------------------------------------
<S>                         <C>                 <C>          <C>
               270,643,296      3,460,435       1,458,234        -
</TABLE>

ITEM 5. OTHER INFORMATION

     We  hired William G. Henderson effective as of June 14, 2004 to be our Vice
President  and  Controller.


                                       45
<PAGE>
<TABLE>
<CAPTION>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

     (a)  Exhibits

The following exhibits are filed in connection with this Report:

NUMBER  DESCRIPTION
------  -----------
<S>     <C>

 *3.1   Memorandum of Association of Transocean Inc., as amended (incorporated by reference to Annex E
        to the Joint Proxy Statement/Prospectus dated October 30, 2000 included in a 424(b)(3) prospectus
        filed by us on November 1, 2000)

 *3.2   Articles of Association of Transocean Inc., as amended (incorporated by reference to Annex F to the
        Joint Proxy Statement/Prospectus dated October 30, 2000 included in a 424(b)(3) prospectus filed by
        us on November 1, 2000)

 *3.3   Certificate of Incorporation on Change of Name to Transocean Inc. (incorporated by reference to
        Exhibit 3.3 to our Form 10-Q for the quarter ended June 30, 2002)

*10.1   Long-Term Incentive Plan of Transocean Inc. (as Amended and Restated Effective February 12, 2004)
        (incorporated by reference to Appendix B to the Proxy Statement dated March 19, 2004 filed by us on
        March 19, 2004)

**31.1  CEO Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

**31.2  CFO Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

**32.1  CEO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

**32.2  CFO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

<FN>
_________________________
*  Incorporated  by  reference  as  indicated.
** Filed  herewith.
</TABLE>

     (b)  Reports on Form 8-K

     We  filed  a  Current  Report  on  Form  8-K on April 27, 2004 (information
furnished not filed) announcing the issuance of the first quarter 2004 financial
results,  a  Current Report on Form 8-K on April 27, 2004 (information furnished
not  filed) announcing our "Monthly Fleet Update" report as of April 27, 2004, a
Current  Report  on  Form  8-K on May 28, 2004 (information furnished not filed)
announcing  our  "Monthly  Fleet  Update"  report  as of May 28, 2004, a Current
Report  on Form 8-K on June 1, 2004 (information furnished not filed) announcing
updates to operating revenues, utilization and average dayrates for each quarter
of  2003  from  that  previously  reported  by  rig  category in the case of our
business segments and a Current Report on Form 8-K on June 30, 2004 (information
furnished not filed) announcing our "Monthly Fleet Update" report as of June 30,
2004.


                                       46
<PAGE>
SIGNATURES

Pursuant  to  the requirements of Section 13 or 15(d) 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,  on  August  6, 2004.

TRANSOCEAN  INC.



By:   /s/  Gregory  L.  Cauthen
     --------------------------
           Gregory  L.  Cauthen
           Senior  Vice  President  and  Chief  Financial  Officer
           (Principal  Financial  Officer)

By:   /s/  William  G.  Henderson
     --------------------------
           William  G.  Henderson
           Vice  President  and  Controller
           (Principal  Accounting  Officer)


                                       47
<PAGE>