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

                                  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, 2002

                                       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 jurisdication                           (I.R.S. Employer
of incorporation or organization)                       Identification  No.)


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

       Registrants' 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  proceeding  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
                                                     -------   -------

     As  of  July  31,  2002,  319,219,986  ordinary shares, par value $0.01 per
share,  were  outstanding.
================================================================================


<PAGE>
<TABLE>
<CAPTION>
                                 TRANSOCEAN INC.
                               INDEX TO FORM 10-Q


                           QUARTER ENDED JUNE 30, 2002


                                                                       Page
                                                                       ----
<S>                                                                   <C>
PART I - FINANCIAL INFORMATION
------------------------------

   ITEM 1. Financial Statements (Unaudited)

      Condensed Consolidated Statements of Operations
         Three and Six Months Ended June 30, 2002 and 2001 . . . . . .   2

      Condensed Consolidated Balance Sheets
         June 30, 2002 and December 31, 2001 . . . . . . . . . . . . .   3

      Condensed Consolidated Statements of Cash Flows
         Six Months Ended June 30, 2002 and 2001 . . . . . . . . . . .   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.  39

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

   ITEM 1. Legal Proceedings . . . . . . . . . . . . . . . . . . . . .  40
   ITEM 4. Submission of Matters to a Vote of Security Holders . . . .  40
   ITEM 5. Other Information . . . . . . . . . . . . . . . . . . . . .  41
   ITEM 6. Exhibits and Reports on Form 8-K. . . . . . . . . . . . . .  42
</TABLE>


<PAGE>
                         PART I - FINANCIAL INFORMATION

ITEM  1.  FINANCIAL  STATEMENTS

     The  condensed  consolidated  financial  statements  of  Transocean  Inc.
(formerly  known  as  "Transocean  Sedco  Forex  Inc.")  and  its  consolidated
subsidiaries  (the "Company") included herein have been prepared, without audit,
pursuant to the rules and regulations of the Securities and Exchange Commission.
Certain information and notes normally included in financial statements prepared
in accordance with accounting principles generally accepted in the United States
have  been  condensed  or  omitted pursuant to such rules and regulations. These
financial statements should be read in conjunction with the audited consolidated
financial  statements  and  the  notes  thereto included in the Company's Annual
Report  on  Form  10-K  for  the  year  ended  December  31,  2001.


                                        1
<PAGE>
<TABLE>
<CAPTION>
                                    TRANSOCEAN INC. AND SUBSIDIARIES
                             CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                  (In millions, except per share data)
                                               (Unaudited)


                                                                Three Months Ended   Six Months Ended
                                                                     June 30,             June 30,
                                                                 ----------------  ---------------------
                                                                  2002     2001       2002       2001
                                                                 -------  -------  ----------  ---------
<S>                                                              <C>      <C>      <C>         <C>
Operating Revenues                                               $646.2   $752.2   $ 1,314.1   $1,302.3
--------------------------------------------------------------------------------------------------------
Costs and Expenses
  Operating and maintenance                                       365.6    394.3       746.6      745.2
  Depreciation                                                    124.3    123.7       249.9      223.1
  Goodwill amortization                                               -     41.4           -       71.6
  General and administrative                                       16.0     14.6        35.8       29.4
--------------------------------------------------------------------------------------------------------
                                                                  505.9    574.0     1,032.3    1,069.3
--------------------------------------------------------------------------------------------------------
Impairment Loss on Long-Lived Assets                                  -        -        (1.1)         -
Gain (Loss) from Sale of Assets, net                               (1.3)       -         0.6       19.6
--------------------------------------------------------------------------------------------------------
Operating Income                                                  139.0    178.2       281.3      252.6
--------------------------------------------------------------------------------------------------------
Other Income (Expense), net
  Equity in earnings of joint ventures                              2.5      4.0         4.4        5.7
  Interest income                                                   5.7      4.7         9.9        8.3
  Interest expense, net of amounts capitalized                    (52.5)   (66.8)     (108.4)    (104.0)
  Other, net                                                       (0.4)    (1.0)       (1.1)      (1.5)
--------------------------------------------------------------------------------------------------------
                                                                  (44.7)   (59.1)      (95.2)     (91.5)
--------------------------------------------------------------------------------------------------------
Income Before Income Taxes, Minority Interest, Extraordinary
  Item and Cumulative Effect of a Change in Accounting
  Principle                                                        94.3    119.1       186.1      161.1
Income Tax Expense                                                 13.9     32.2        27.7       42.3
Minority Interest                                                   0.4      1.1         1.1        2.5
--------------------------------------------------------------------------------------------------------
Income Before Extraordinary Item and Cumulative Effect of a
  Change in Accounting Principle                                   80.0     85.8       157.3      116.3
Loss on Extraordinary Item, net of tax                                -    (17.3)          -      (17.3)
Cumulative Effect of a Change in Accounting Principle                 -        -    (1,363.7)         -
--------------------------------------------------------------------------------------------------------
Net Income (Loss)                                                $ 80.0   $ 68.5   $(1,206.4)  $   99.0
========================================================================================================

Basic Earnings (Loss) Per Share
  Income Before Extraordinary Item and Cumulative Effect of a
    Change in Accounting Principle                               $ 0.25   $ 0.27   $    0.49   $   0.39
  Loss on Extraordinary Item, net of tax                              -    (0.05)          -      (0.06)
  Cumulative Effect of a Change in Accounting Principle               -        -       (4.27)         -
--------------------------------------------------------------------------------------------------------
Net Income (Loss)                                                $ 0.25   $ 0.22   $   (3.78)  $   0.33
========================================================================================================

Diluted Earnings (Loss) Per Share
  Income Before Extraordinary Item and Cumulative Effect of a
    Change in Accounting Principle                               $ 0.25   $ 0.26   $    0.49   $   0.38
  Loss on Extraordinary Item, net of tax                              -    (0.05)          -      (0.06)
    Cumulative Effect of a Change in Accounting Principle             -        -       (4.22)         -
--------------------------------------------------------------------------------------------------------
Net Income (Loss)                                                $ 0.25   $ 0.21   $   (3.73)  $   0.32
========================================================================================================

Weighted Average Shares Outstanding
  Basic                                                           319.1    318.2       319.1      299.5
--------------------------------------------------------------------------------------------------------
  Diluted                                                         323.9    325.0       323.6      305.3
--------------------------------------------------------------------------------------------------------

Dividends Paid Per Share                                         $ 0.03   $ 0.03   $    0.06   $   0.06
--------------------------------------------------------------------------------------------------------
</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,
                                                                                   2002           2001
                                                                               ------------  --------------
<S>                                                                            <C>           <C>
                                                                                (Unaudited)
                                                 ASSETS

Cash and Cash Equivalents                                                      $     755.9   $       853.4
Accounts Receivable, net of allowance for doubtful accounts
   of $28.5 and $24.2 at June 30, 2002 and December 31, 2001, respectively           591.5           675.7
Materials and Supplies, net of allowance for obsolescence of $19.6
   and $24.1 at June 30, 2002 and December 31, 2001, respectively                    169.3           158.8
Deferred Income Taxes                                                                 21.3            21.0
Other Current Assets                                                                  40.4            27.9
-----------------------------------------------------------------------------------------------------------
     Total Current Assets                                                          1,578.4         1,736.8
-----------------------------------------------------------------------------------------------------------

Property and Equipment                                                            10,045.4        10,081.4
Less Accumulated Depreciation                                                      1,930.6         1,713.3
-----------------------------------------------------------------------------------------------------------
     Property and Equipment, net                                                   8,114.8         8,368.1
-----------------------------------------------------------------------------------------------------------

Goodwill, net                                                                      5,103.0         6,466.7
Investments in and Advances to Joint Ventures                                        114.3           107.1
Other Assets                                                                         393.6           341.1
-----------------------------------------------------------------------------------------------------------
     Total Assets                                                              $  15,304.1   $    17,019.8
-----------------------------------------------------------------------------------------------------------

                                    LIABILITIES AND SHAREHOLDERS' EQUITY

Accounts Payable                                                               $     133.3   $       188.4
Accrued Income Taxes                                                                 210.5           188.2
Debt Due Within One Year                                                             924.7           484.4
Other Current Liabilities                                                            236.4           283.4
-----------------------------------------------------------------------------------------------------------
     Total Current Liabilities                                                     1,504.9         1,144.4
-----------------------------------------------------------------------------------------------------------

Long-Term Debt                                                                     3,702.6         4,539.4
Deferred Income Taxes                                                                279.1           317.1
Other Long-Term Liabilities                                                          120.0           108.6
-----------------------------------------------------------------------------------------------------------
     Total Long-Term Liabilities                                                   4,101.7         4,965.1
-----------------------------------------------------------------------------------------------------------

Commitments and Contingencies

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,
   319,207,590 and 318,816,035 shares issued and outstanding at
   June 30, 2002 and December 31, 2001, respectively                                   3.2             3.2

Additional Paid-in Capital                                                        10,622.4        10,611.7
Accumulated Other Comprehensive Income                                                (0.2)           (2.3)
Retained Earnings (Deficit)                                                         (927.9)          297.7
-----------------------------------------------------------------------------------------------------------
     Total Shareholders' Equity                                                    9,697.5        10,910.3
-----------------------------------------------------------------------------------------------------------
     Total Liabilities and Shareholders' Equity                                $  15,304.1   $    17,019.8
===========================================================================================================
</TABLE>


                             See accompanying notes.


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

                                                                                   Six Months Ended June 30,
                                                                                   -------------------------
                                                                                        2002        2001
                                                                                   ------------  -----------
<S>                                                                                <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES
  Net income (loss)                                                                  $(1,206.4)  $     99.0
  Adjustments to reconcile net income (loss) to
    net cash provided by operating activities
      Depreciation                                                                       249.9        223.1
      Goodwill amortization                                                                  -         71.6
      Cumulative effect of a change in accounting principle - goodwill impairment      1,363.7            -
      Deferred income taxes                                                              (38.3)       (33.8)
      Equity in earnings of joint ventures                                                (4.4)        (5.7)
      Net (gain)/loss from disposal of assets                                              2.3        (18.4)
      Impairment loss on long-lived assets                                                 1.1            -
      Loss on sale of securities                                                             -          1.8
      Amortization of debt-related discounts/premiums, fair value
        adjustments and issue costs, net                                                   2.9        (11.3)
      Deferred income, net                                                                (6.0)       (30.0)
      Deferred expenses, net                                                               7.0        (27.6)
      Extraordinary loss on debt extinguishment, net of tax                                  -         17.3
      Other, net                                                                           9.7          6.9
      Changes in operating assets and liabilities, net of effects from the
        R&B Falcon merger
          Accounts receivable                                                             84.1       (162.6)
          Accounts payable and other current liabilities                                 (84.7)       (95.6)
          Income taxes receivable/payable, net                                            22.3         30.3
          Other current assets                                                           (22.7)       (13.8)
------------------------------------------------------------------------------------------------------------
Net Cash Provided by Operating Activities                                                380.5         51.2
------------------------------------------------------------------------------------------------------------

CASH FLOWS FROM INVESTING ACTIVITIES
  Capital expenditures                                                                   (81.2)      (371.8)
  Proceeds from disposal of assets, net                                                   65.0         29.2
  Proceeds from sale of securities                                                           -         16.8
  Merger costs paid                                                                          -        (24.5)
  Cash acquired in merger, net of cash paid                                                  -        264.7
  Joint ventures and other investments, net                                                  -          2.7
------------------------------------------------------------------------------------------------------------
Net Cash Used in Investing Activities                                                    (16.2)       (82.9)
------------------------------------------------------------------------------------------------------------

CASH FLOWS FROM FINANCING ACTIVITIES
Net borrowings (repayments) on revolving credit agreements                                   -       (180.1)
Net borrowings (repayments) under commercial paper program                              (326.4)        60.3
Repayments on other debt instruments                                                    (119.6)    (1,478.2)
Net proceeds from issuance of  debt                                                          -      1,693.5
Net proceeds from issuance of ordinary shares under stock-based compensation plans        10.3         28.8
Proceeds from issuance of ordinary shares upon exercise of warrants                          -         10.6
Dividends paid                                                                           (19.1)       (19.1)
Financing costs                                                                           (8.1)       (15.5)
Other, net                                                                                 1.1          5.6
------------------------------------------------------------------------------------------------------------
Net Cash Provided by (Used in) Financing Activities                                     (461.8)       105.9
------------------------------------------------------------------------------------------------------------

Net Increase (Decrease) in Cash and Cash Equivalents                                     (97.5)        74.2
------------------------------------------------------------------------------------------------------------
Cash and Cash Equivalents at Beginning of Period                                         853.4         34.5
------------------------------------------------------------------------------------------------------------
Cash and Cash Equivalents at End of Period                                           $   755.9   $    108.7
============================================================================================================
</TABLE>


                             See accompanying notes.


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


NOTE 1 -  PRINCIPLES OF CONSOLIDATION

     Transocean  Inc. (formerly known as "Transocean Sedco Forex Inc.", together
with  its  subsidiaries and predecessors, unless the context requires otherwise,
the "Company") is a leading international provider of offshore and inland marine
contract  drilling  services  for  oil  and  gas wells. As of June 30, 2002, the
Company  owned,  had  partial  ownership  interests  in or managed more than 150
mobile  offshore  and  barge  drilling units. The Company contracts its drilling
rigs, related equipment and work crews primarily on a dayrate basis to drill oil
and  gas  wells.

     On  January  31, 2001, the Company completed a merger transaction (the "R&B
Falcon  merger")  with R&B Falcon Corporation ("R&B Falcon"). As a result of the
merger,  R&B  Falcon  became an indirect wholly owned subsidiary of the Company.
The  merger  was  accounted for as a purchase with the Company as the accounting
acquiror. The condensed consolidated statements of operations and cash flows for
the  six months ended June 30, 2001 include five months of operating results and
cash  flows  for  R&B  Falcon.

     Intercompany  transactions  and  accounts  have been eliminated. The equity
method  of accounting is used for investments in joint ventures owned 50 percent
or  less  and for investments in joint ventures owned more than 50 percent where
the  Company does not have significant control over the day-to-day operations of
the  joint  venture.

NOTE 2 -  GENERAL

      BASIS OF CONSOLIDATION - The accompanying condensed consolidated financial
statements  of  the  Company have been prepared without audit in accordance with
accounting  principles  generally  accepted  in  the  United States ("U.S.") 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. 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. Operating results for the three and
six  months  ended  June  30, 2002 are not necessarily indicative of the results
that  may  be  expected  for the year ending December 31, 2002 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 the Company's Annual Report on Form
10-K  for  the  year  ended  December  31,  2001.

      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, the Company evaluates its estimates, including
those  related  to  bad debts, materials and supplies obsolescence, investments,
intangible  assets  and  goodwill,  income taxes, financing operations, workers'
insurance,  pensions  and  other  post-retirement  and  employment  benefits and
contingent liabilities. The Company bases its 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  could  differ  from  such  estimates.

     SUPPLEMENTARY CASH FLOW INFORMATION - Cash payments for interest and income
taxes,  net,  were  $109.8  million and $44.2 million, respectively, for the six
months  ended  June 30, 2002 and $158.7 million and $46.5 million, respectively,
for  the  six  months  ended  June  30,  2001.

      GOODWILL  -  Prior  to  the  implementation  of  the  Financial Accounting
Standards  Board's ("FASB") Statement of Financial Accounting Standards ("SFAS")
142,  Goodwill  and  Other  Intangible  Assets  (see  "-New  Accounting
Pronouncements"), the excess of the purchase price over the estimated fair value
of  net  assets  acquired  was  accounted for as goodwill and was amortized on a
straight-line  basis  based on a 40-year life. The amortization period was based
on  the  nature of the offshore drilling industry, long-lived drilling equipment
and  the  long-standing  relationships  with  core  customers.


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


     During the first quarter of 2002, the Company performed the initial test of
impairment  of  goodwill  on  its  two  reporting units, "International and U.S.
Floater  Contract  Drilling  Services"  and  "Gulf  of Mexico Shallow and Inland
Water."  The test was applied utilizing the fair value of the reporting units as
of  January  1, 2002 and was determined based on a combination of each reporting
unit's  discounted  cash  flows  and  publicly  traded  company  multiples  and
acquisition multiples of comparable businesses. There was no goodwill impairment
for  the  International  and  U.S.  Floater Contract Drilling Services reporting
unit.  However, because of continued deterioration in the Gulf of Mexico Shallow
and Inland Water business segment since the completion of the R&B Falcon merger,
a  $1,363.7 million impairment of goodwill was recognized as a cumulative effect
of  a  change in accounting principle in the six months ended June 30, 2002. The
Company's  goodwill  balance, after giving effect to the goodwill write down, is
$5.1  billion  as  of  June  30,  2002.

     The  changes  in  the  carrying  amount  of  goodwill  are  as  follows (in
millions):

<TABLE>
<CAPTION>
                                                              Balance at       Loss on      Balance at
                                                           January 1, 2002   Impairment   June 30, 2002
                                                           ----------------  -----------  --------------
<S>                                                        <C>               <C>          <C>
International and U.S. Floater Contract Drilling Services  $        4,721.1  $        -   $      4,721.1
Gulf of Mexico Shallow and Inland Water                             1,745.6    (1,363.7)           381.9
                                                           ----------------  -----------  --------------
                                                           $        6,466.7  $ (1,363.7)  $      5,103.0
                                                           ================  ===========  ==============
</TABLE>


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


     Net  income  and earnings per share for the three and six months ended June
30,  2002  and  2001  adjusted  for  goodwill  amortization  are  as follows (in
millions):

<TABLE>
<CAPTION>
                                                            Three Months Ended       Six Months Ended
                                                                  June 30,                June 30,
                                                          -----------------------  ----------------------
                                                             2002        2001         2002        2001
                                                          ----------  -----------  ----------  ----------
<S>                                                       <C>         <C>          <C>         <C>
Reported net income before extraordinary item and
  cumulative effect of a change in
  accounting principle                                    $     80.0  $     85.8   $   157.3   $   116.3
Add back: Goodwill amortization                                    -        41.4           -        71.6
                                                          ----------  -----------  ----------  ----------
Adjusted reported net income before extraordinary
  item and cumulative effect of a change in accounting
  principle                                               $     80.0  $    127.2   $   157.3   $   187.9
Loss on extraordinary item, net of tax                             -       (17.3)          -       (17.3)
Cumulative effect of a change in accounting principle              -           -    (1,363.7)          -
                                                          ----------  -----------  ----------  ----------
Adjusted net income (loss)                                $     80.0  $    109.9   $(1,206.4)  $   170.6
                                                          ==========  ===========  ==========  ==========

Basic earnings per share:
Reported net income before extraordinary item and
  cumulative effect of a change in accounting
  principle                                               $     0.25  $     0.27   $    0.49   $    0.39
Goodwill amortization                                              -        0.13           -        0.24
                                                          ----------  -----------  ----------  ----------
Adjusted reported net income before extraordinary
  item and cumulative effect of a change in accounting
  principle                                                     0.25        0.40        0.49        0.63
Loss on extraordinary item, net of tax                             -       (0.05)          -       (0.06)
Cumulative effect of a change in accounting principle              -           -       (4.27)          -
                                                          ----------  -----------  ----------  ----------
Adjusted net income (loss)                                $     0.25  $     0.35   $   (3.78)  $    0.57
                                                          ==========  ===========  ==========  ==========

Diluted earnings per share:
Reported net income before extraordinary item and
  cumulative effect of a change in accounting principle   $     0.25  $     0.26   $    0.49   $    0.38
Goodwill amortization                                              -        0.13           -        0.24
                                                          ----------  -----------  ----------  ----------
Adjusted reported net income before extraordinary item
  and cumulative effect of a change in accounting
  principle                                                     0.25        0.39        0.49        0.62
Loss on extraordinary item, net of tax                             -       (0.05)          -       (0.06)
Cumulative effect of a change in accounting principle              -           -       (4.22)          -
                                                          ----------  -----------  ----------  ----------
Adjusted net income (loss)                                $     0.25  $     0.34   $   (3.73)  $    0.56
                                                          ==========  ===========  ==========  ==========
</TABLE>

      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  or  group  of  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. Property and
equipment  held  for  sale  are  recorded  at the lower of net book value or net
realizable  value.  See  "-New  Accounting  Pronouncements."


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


      CAPITALIZED  INTEREST - Interest costs for the construction and upgrade of
qualifying  assets  are capitalized. The Company recorded $9.4 million and $30.5
million  in  capitalized interest costs on construction work in progress for the
three  and  six  months  ended June 30, 2001, respectively. No interest cost was
capitalized  during  the  three  and  six  months  ended  June  30,  2002.

     CHANGE  IN  ESTIMATE  -  As  a result of the R&B Falcon merger, the Company
conformed  its  policies  relating  to  estimated  rig lives and salvage values.
Estimated  useful  lives  of  drilling  units  now  range  from  18 to 35 years,
reflecting  maintenance  history  and  market  demand  for these drilling units,
buildings  and improvements from 10 to 30 years and machinery and equipment from
four  to  12 years. Depreciation expense for the three and six months ended June
30, 2001 was reduced by approximately $6.4 million (net $0.02 per diluted share)
and  $10.6  million  (net $0.03 per diluted share), respectively, as a result of
conforming  these  policies.

     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.
There  is  no  expected  relationship between the provision for income taxes and
income  before  income  taxes  because  the  countries  have  different taxation
regimes,  which 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.

     COMPREHENSIVE INCOME - The components of total comprehensive income for the
three  and six months ended June 30, 2002 and 2001, respectively, are as follows
(in  millions):

<TABLE>
<CAPTION>
                                                               Three Months Ended         Six Months Ended
                                                                     June 30,                  June 30,
                                                             ------------------------  -----------------------
                                                                2002         2001         2002        2001
                                                             -----------  -----------  ----------  -----------
<S>                                                          <C>          <C>          <C>         <C>
Net income (loss)                                            $     80.0   $     68.5   $(1,206.4)  $     99.0
Gain on terminated interest rate swaps                                -            -           -          4.1
Amortization of gain on terminated interest rate swaps                -         (0.1)       (0.1)        (0.1)
Change in unrealized loss on cash flow hedges                         -          0.9           -         (0.5)
Change in unrealized loss on securities available for sale            -          0.7         0.1         (0.4)
Change in share of unrealized loss in unconsolidated
  joint venture's interest rate swaps                              (1.0)           -         2.1            -
                                                             -----------  -----------  ----------  -----------
     Total comprehensive income (loss)                       $     79.0   $     70.0   $(1,204.3)  $    102.1
                                                             ===========  ===========  ==========  ===========
</TABLE>

     The  components  of  accumulated  other comprehensive income as of June 30,
2002  and  December  31,  2001  are  as  follows  (in  millions):

<TABLE>
<CAPTION>
                                                                                 June 30,    December 31,
                                                                                   2002          2001
                                                                                ----------  --------------
<S>                                                                             <C>         <C>
Gain on terminated interest rate swaps                                          $     3.8   $         3.9
Unrealized loss on securities available for sale                                     (0.5)           (0.6)
Share of unrealized loss in unconsolidated joint venture's interest rate swaps       (3.5)           (5.6)
                                                                                ----------  --------------
     Accumulated other comprehensive income                                     $    (0.2)  $        (2.3)
                                                                                ==========  ==============
</TABLE>


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


     SEGMENTS - The Company's  operations  are  aggregated  into  two reportable
segments: (i) International and U.S. Floater Contract Drilling Services and (ii)
Gulf  of  Mexico  Shallow  and  Inland Water. The Company provides services with
different  types  of  drilling  equipment  in  several  geographic  regions. The
location  of  the  Company's operating assets and the allocation of resources to
build  or  upgrade  drilling  units is determined by the activities and needs of
customers.  See  Note  7.

     INTERIM  FINANCIAL  INFORMATION - The condensed  consolidated  financial
statements  reflect  all  adjustments,  which are, in the opinion of management,
necessary for a fair statement of results of operations for the interim periods.
Such  adjustments  are  considered  to  be  of  a normal recurring nature unless
otherwise  identified.

     NEW  ACCOUNTING PRONOUNCEMENTS - In  July  2001,  the FASB issued SFAS 142,
Goodwill  and  Other  Intangible  Assets,  which  is  effective for fiscal years
beginning  after  December  15,  2001.  Under  SFAS 142, goodwill and intangible
assets  with  indefinite lives are no longer amortized but are reviewed at least
annually  for  impairment.  The  amortization  provisions  of  SFAS 142 apply to
goodwill  and  intangible  assets  acquired after June 30, 2001. With respect to
goodwill  and  intangible  assets  acquired  prior  to July 1, 2001, the Company
adopted  SFAS 142 effective January 1, 2002. In conjunction with the adoption of
this  statement,  the  Company  has  discontinued  the amortization of goodwill.
Application  of  the  non-amortization  provisions  of  SFAS 142 for goodwill is
expected  to  result  in  an  increase in operating income of approximately $155
million  in  2002.  See  "-Goodwill."

     In  August  2001,  the  FASB  issued SFAS 144, Accounting for Impairment or
Disposal  of  Long-Lived  Assets.  SFAS  144 supersedes SFAS 121, Accounting for
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed of, and
the  accounting  and reporting provisions of Accounting Principles Board Opinion
("APB")  30,  Reporting  the  Results  of  Operations - Reporting the Effects of
Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently
Occurring  Events  and Transactions. SFAS 144 retains the fundamental provisions
of  SFAS  121 for recognition and measurement of long-lived asset impairment and
for the measurement of long-lived assets to be disposed of by sale and the basic
requirements  of  APB  30. In addition to these fundamental provisions, SFAS 144
provides guidance for determining whether long-lived assets should be tested for
impairment  and  specific  criteria  for classifying assets to be disposed of as
held  for  sale.  The  statement  is  effective for fiscal years beginning after
December  15, 2001. The Company adopted the statement as of January 1, 2002. The
adoption  of this statement had no material effect on the Company's consolidated
financial  position  or  results  of  operations.

     In  April 2002, the FASB issued SFAS 145, Rescission of FASB Statements No.
4,  44,  and  64, Amendment of FASB Statement No. 13, and Technical Corrections.
This statement eliminates the requirement under SFAS 4 to aggregate and classify
all  gains  and losses from extinguishment of debt as an extraordinary item, net
of  related  income  tax  effect.  This statement also amends SFAS 13 to require
certain  lease  modifications  with  economic  effects similar to sale-leaseback
transactions be accounted for in the same manner as sale-leaseback transactions.
In addition, SFAS 145 requires reclassification of gains and losses in all prior
periods  presented  in  comparative  financial  statements  related  to  debt
extinguishment  that  do not meet the criteria for extraordinary item in APB 30.
The  statement  is  effective for fiscal years beginning after May 15, 2002 with
early  adoption encouraged. The Company will adopt SFAS 145 effective January 1,
2003.  Management  does not expect adoption of this statement to have a material
effect  on  the  Company's  consolidated  financial  position  or  results  of
operations.

     In  July  2002,  the  FASB  issued  SFAS  146,  Obligations Associated with
Disposal  Activities, which is effective for disposal activities initiated after
December  15,  2002,  with  early  application  encouraged.  SFAS  146 addresses
financial  accounting  and  reporting for costs associated with exit or disposal
activities and nullifies EITF Issue No. 94-3, "Liability Recognition for Certain
Employee  Termination  Benefits  and  Other Costs to Exit an Activity (including
Certain  Costs  Incurred in a Restructuring)." Under this statement, a liability
for  a cost associated with an exit or disposal activity would be recognized and
measured  at  its  fair  value  when  it  is incurred rather than at the date of
commitment  to  an  exit plan. Under SFAS 146, severance pay would be recognized
over  time  rather  than  up  front  provided  the  benefit arrangement requires
employees  to  render  future service beyond a "minimum retention period", which
would  be  based  on  the  legal  notification  period,  or  if there is no such
requirement,  60  days,  thereby  allowing  a  liability to be recorded over the


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


employees' future service period. The Company will adopt SFAS 146 effective with
disposal  activities  initiated  after  December  15,  2002. Management does not
expect  adoption  of  this  statement to have a material effect on the Company's
consolidated  financial  position  or  results  of  operations.

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

NOTE 3 - BUSINESS COMBINATION

     On  January  31,  2001, the Company completed a merger transaction with R&B
Falcon,  in which an indirect wholly owned subsidiary of the Company merged with
and  into  R&B Falcon. As a result of the merger, R&B Falcon common shareholders
received  0.5  newly  issued  ordinary shares of the Company for each R&B Falcon
share.  The Company issued approximately 106 million ordinary shares in exchange
for  the  issued  and  outstanding shares of R&B Falcon and assumed warrants and
options  exercisable  for approximately 13 million ordinary shares. The ordinary
shares  issued  in  exchange for the issued and outstanding shares of R&B Falcon
constituted  approximately  33  percent  of  the  Company's outstanding ordinary
shares  after  the  merger.

     The  Company  accounted  for  the  merger  using  the  purchase  method  of
accounting  with  the  Company  treated as the accounting acquiror. The purchase
price  of  $6.7  billion is comprised of the calculated market capitalization of
the  Company's  ordinary  shares issued at the time of merger with R&B Falcon of
$6.1  billion  and  the  estimated  fair  value  of R&B Falcon stock options and
warrants at the time of the merger of $0.6 billion. The market capitalization of
the  Company's  ordinary  shares issued was calculated using the average closing
price of the Company's ordinary shares for a period immediately before and after
August  21,  2000,  the  date  the  merger  was  announced.

     The  purchase  price included, at estimated fair value at January 31, 2001,
current  assets  of  $672  million, drilling and other property and equipment of
$4,010  million,  other  assets  of  $160  million and the assumption of current
liabilities of $338 million, other net long-term liabilities of $242 million and
long-term  debt  of  $3,206  million.  The excess of the purchase price over the
estimated  fair  value  of  net  assets  acquired  was $5,630 million, which was
accounted  for as goodwill and is reviewed for impairment annually in accordance
with  SFAS  142.  See  Note  2.

     In  conjunction  with  the  R&B  Falcon  merger,  the Company established a
liability  of $16.5 million for the estimated severance-related costs associated
with  the  involuntary  termination  of  569  R&B  Falcon  employees pursuant to
management's  plan  to  consolidate  operations  and  administrative  functions
post-merger.  Included  in  the  569  planned  involuntary terminations were 387
employees  engaged  in  the  Company's  land drilling business in Venezuela. The
Company has suspended active marketing efforts to divest this business and, as a
result, the estimated liability was reduced by $4.3 million in the third quarter
of  2001  with  an  offset  to  goodwill.  Through  June  30,  2002 all required
severance-related  costs  were  paid  to  182  employees  whose  positions  were
eliminated  as  a  result  of  this  plan.

     Unaudited  pro  forma  combined  operating  results  of the Company and R&B
Falcon assuming the merger was completed as of January 1, 2001 are summarized as
follows  (in  millions,  except  per  share  data):

<TABLE>
<CAPTION>
                                       Six Months Ended
                                         June 30, 2001
                                       ----------------
<S>                                    <C>
Operating revenues                     $        1,428.1
Operating income                                  252.1
Net income from continuing operations             102.0
Basic earnings per share               $           0.32
Diluted earnings per share                         0.31
</TABLE>


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


     The  pro forma information includes adjustments for additional depreciation
based  on the fair market value of the drilling and other property and equipment
acquired,  amortization  of  goodwill  arising  from  the transaction, increased
interest  expense  for  debt  assumed  in the merger and related adjustments for
income  taxes.  The  pro  forma information is not necessarily indicative of the
results  of  operations had the transaction been effected on the assumed date or
the  results  of  operations  for  any  future  periods.

NOTE 4 -  DEBT

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

<TABLE>
<CAPTION>
                                                                               June 30,   December 31,
                                                                                 2002         2001
                                                                               ---------  -------------
<S>                                                                            <C>        <C>
Commercial Paper.                                                              $       -  $       326.4
6.5% Senior Notes, due April 2003                                                  240.1          240.5
9.125% Senior Notes, due December 2003                                              90.7           92.0
Term Loan Agreement - final maturity December 2004                                 350.0          400.0
6.75% Senior Notes, due April 2005                                                 359.5          354.6
7.31% Nautilus Class A1 Amortizing Notes - final maturity May 2005                 124.2          142.9
9.41% Nautilus Class A2 Notes, due May 2005                                         52.1           52.4
Secured Rig Financing                                                                  -           50.6
6.95% Senior Notes, due April 2008                                                 259.1          252.3
9.5% Senior Notes, due December 2008                                               352.2          348.1
6.625% Notes, due April 2011                                                       739.5          711.7
7.375% Senior Notes, due April 2018                                                250.5          250.5
Zero Coupon Convertible Debentures, due May 2020 (put options exercisable
  May 2003, May 2008 and May 2013)                                                 519.6          512.2
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                                                      198.0          197.9
7.45% Notes, due April 2027 (put options exercisable April 2007)                    94.5           94.4
7.5% Notes, due April 2031                                                         597.3          597.3
                                                                               ---------  -------------
   Total Debt                                                                  $ 4,627.3  $     5,023.8
   Less Debt Due Within One Year (a)                                               924.7          484.4
                                                                               ---------  -------------
   Total Long-Term Debt                                                        $ 3,702.6  $     4,539.4
                                                                               =========  =============
</TABLE>

(a)  The Zero Coupon Convertible Debentures are classified as debt due within
     one year  since  the  put  option  can  be  exercised  in  May  2003.


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


     The  scheduled maturity of the face value of the Company's debt assumes the
put  options  on  the  Zero  Coupon  Convertible  Debentures,  1.5%  Convertible
Debentures  and  7.45%  Notes  will be exercised in May 2003, May 2006 and April
2007,  respectively,  and  is  as  follows  (in  millions):

<TABLE>
<CAPTION>
                                      Twelve
                                      Months
                                      Ending
                                     June 30,
                                     ---------
<S>                                  <C>
          2003                       $   948.2
          2004                           280.2
          2005                           517.3
          2006                           400.0
          2007                           100.0
          Thereafter                   2,300.0
                                     ---------
              Total                  $ 4,545.7
                                     =========
</TABLE>

     Commercial  Paper  Program  -  The Company's Revolving Credit Agreements, a
$550.0  million five-year revolving credit agreement dated December 29, 2000 and
a  $250.0  million  364-day  revolving credit agreement dated December 27, 2001,
provide  liquidity for commercial paper borrowings. At June 30, 2002, no amounts
were  outstanding  under  the  Commercial  Paper  Program or under the Revolving
Credit  Agreements.

     Term  Loan  Agreement  -  The  Company  is party to an amortizing unsecured
five-year term loan agreement dated as of December 16, 1999. Amounts outstanding
under  the  Term Loan Agreement bear interest at the Company's option, at a base
rate  or London Interbank Offered Rate ("LIBOR") plus a margin (0.70 percent per
annum  at June 30, 2002) that varies depending on the Company's senior unsecured
public debt rating. The debt began to amortize in March 2002, at a rate of $25.0
million  per  quarter in 2002. In 2003 and 2004, the debt amortizes at a rate of
$37.5  million  per quarter. As of June 30, 2002, $350.0 million was outstanding
under  this  agreement.

     Exchange  Offer  - In March 2002, the Company completed exchange offers and
consent  solicitations for the 6.5%, 6.75%, 6.95%, 7.375%, 9.125% and 9.5% notes
of  R&B  Falcon. As a result of these exchange offers and consent solicitations,
approximately  $234.5  million,  $342.3  million, $247.8 million $246.5 million,
$76.9  million,  and  $289.8  million  principal amount of the outstanding 6.5%,
6.75%,  6.95%,  7.375%,  9.125% and 9.5% notes, respectively, of R&B Falcon were
exchanged  for newly issued 6.5%, 6.75%, 6.95%, 7.375%, 9.125% and 9.5% notes of
the  Company  having  the same principal amount, interest rate, redemption terms
and  payment  and  maturity  dates (and accruing interest from the last date for
which  interest had been paid on the R&B Falcon notes). Because the holders of a
majority  in  principal amount of each of these series of notes consented to the
proposed amendments to the applicable indenture pursuant to which the notes were
issued,  some covenants, restrictions and events of default were eliminated from
the  indentures  with  respect  to  these  series  of  notes. After the exchange
approximately  $5.0  million,  $7.7  million,  $2.2 million, $3.5 million, $10.2
million  and  $10.2  million  principal  amount  of the outstanding 6.5%, 6.75%,
6.95%,  7.375%,  9.125%  and  9.5% notes, respectively, not exchanged remain the
obligation  of  R&B  Falcon.  These  notes  are  combined  with the notes of the
corresponding  series  issued  by  the Company in the above table. In connection
with  the  exchange offers, an aggregate of $8.3 million in consent payments was
made by R&B Falcon to holders of R&B Falcon notes whose notes were tendered (and
not  validly  withdrawn)  within  the  required  time  period  and  accepted for
exchange.  The  consent  payments  will  be amortized as an increase to interest
expense  over  the  remaining  term  of  the respective notes using the interest
method.  As a result of this amortization, interest expense for 2002 is expected
to  increase  approximately  $1.3  million.


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


     Secured  Rig  Financing  -  In January 2002, the Company exercised its call
option  under the financing arrangement to repay the financing on the Trident 16
prior  to  the  expiration of the scheduled term. The aggregate principal amount
outstanding  was  $32.2 million. The premium paid as a result of the call option
of approximately $2 million was recorded as an increase in the net book value of
the  Trident  16.

     In  March  2002,  the  Company  also exercised its call option to repay the
financing  on  the Trident IX prior to the expiration of the scheduled term. The
aggregate  principal amount outstanding was $14.9 million. The premium paid as a
result  of  the  call  option  of  approximately $0.5 million was recorded as an
increase  in  the  net  book  value  of  the  Trident  IX.

     Redeemed  and  Repurchased  Debt  -  On April 10, 2001, R&B Falcon acquired
pursuant  to  a  tender  offer all of the approximately $400.0 million principal
amount  outstanding  11.375% Senior Secured Notes due 2009 of its affiliate, RBF
Finance  Co.,  at 122.51 percent, or $1,225.10 per $1,000 principal amount, plus
accrued and unpaid interest. On April 6, 2001, RBF Finance Co. also redeemed all
of  the  approximately  $400.0  million  principal amount outstanding 11% Senior
Secured  Notes  due  2006  at 125.282 percent, or $1,252.82 per $1,000 principal
amount,  plus  accrued  and  unpaid interest, and R&B Falcon redeemed all of the
approximately  $200.0  million  principal amount outstanding 12.25% Senior Notes
due  2006  at  130.675  percent  or  $1,306.75 per $1,000 principal amount, plus
accrued and unpaid interest. The Company funded the redemption from the issuance
of  the  6.625%  Notes  and  7.5% Notes in April 2001.  In the second quarter of
2001, the Company recognized an extraordinary loss, net of tax, of $18.9 million
($0.06  per  diluted  share)  on  the  early  extinguishment  of  this  debt.

     On  March  30,  2001,  pursuant  to  an  offer  made in connection with the
Company's  acquisition  of  R&B  Falcon,  Cliffs  Drilling  Company  ("Cliffs
Drilling"), a wholly owned subsidiary of R&B Falcon, acquired approximately $0.1
million of the 10.25% Senior Notes due 2003 at an amount equal to 101 percent of
the  principal  amount.  On  May  18,  2001, Cliffs Drilling redeemed all of the
approximately  $200.0  million  principal amount outstanding 10.25% Senior Notes
due  2003,  at  102.5  percent,  or  $1,025.00 per $1,000 principal amount, plus
interest  accrued to the redemption date. As a result, the Company recognized an
extraordinary gain, net of tax, of $1.6 million ($0.01 per diluted share) in the
second  quarter  of  2001  relating  to  the  early extinguishment of this debt.

NOTE 5 - OTHER CURRENT LIABILITIES

     Other  current  liabilities  are  comprised of the following (in millions):

<TABLE>
<CAPTION>
                                             June 30,   December 31,
                                               2002         2001
                                            ---------  -------------
<S>                                         <C>        <C>
Accrued Payroll and Employee Benefits       $   119.8  $       134.2
Accrued Interest                                 34.5           38.8
Contract Disputes and Legal Claims               27.6           47.5
Accrued Taxes, Other than Income                 22.6           26.6
Deferred Revenue                                 16.8           18.2
Other                                            15.1           18.1
                                            ---------  -------------
                                            $   236.4  $       283.4
                                            =========  =============
</TABLE>


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


NOTE 6 -  INTEREST RATE SWAPS

     In  February  2002,  the Company entered into interest rate swap agreements
with  a  group  of  banks  in  the  aggregate  notional amount of $900.0 million
relating  to  the  Company's  $350.0 million aggregate principal amount of 6.75%
Senior  Notes due April 2005, $250.0 million aggregate principal amount of 6.95%
Senior  Notes  due  April  2008 and $300.0 million aggregate principal amount of
9.5%  Senior  Notes  due  December 2008. The objective of each transaction is to
protect  the  debt against changes in fair value due to changes in the benchmark
interest  rate.  Under  each  interest rate swap, the Company receives the fixed
rate  equal  to the coupon of the hedged item and pays the floating rate (LIBOR)
plus  a  margin  of  246  basis  points,  171 basis points and 413 basis points,
respectively,  which  are designated as the respective benchmark interest rates,
on  each  of  the interest payment dates until maturity of the respective notes.
The  hedges are considered perfectly effective against changes in the fair value
of the debt due to changes in the benchmark interest rates over their term. As a
result,  the  shortcut  method  applies  and  there  is  no need to periodically
reassess  the  effectiveness  of  the  hedges  during  the  term  of  the swaps.

     At  June  30,  2002, the market value of the Company's outstanding interest
rate  swaps  was  a net asset of $63.0 million and was included in other assets,
with  corresponding increases to long-term debt and debt due within one year, as
appropriate.

     Deepwater  Drilling  L.L.C.,  an  unconsolidated  subsidiary  in  which the
Company  has  a  50  percent  ownership interest, has entered into interest rate
swaps  with  aggregate  market  values netting to a liability of $7.9 million at
June  30,  2002.  The  Company's  interest  in  these swaps has been included in
accumulated  other  comprehensive  income  with  a  corresponding  reduction  to
investments  in  and  advances  to  joint  ventures.

NOTE 7 -  SEGMENTS

     The  Company's  operations are aggregated into two reportable segments: (i)
International  and  U.S.  Floater  Contract  Drilling  Services and (ii) Gulf of
Mexico  Shallow  and  Inland  Water. The International and U.S. Floater Contract
Drilling  Services  segment  consists  of  high-specification  floaters,  other
floaters,  non-U.S.  jackups,  other  mobile  offshore  drilling units and other
assets  used  in  support  of  offshore drilling activities and offshore support
services. The Gulf of Mexico Shallow and Inland Water segment consists of jackup
and  submersible  drilling  rigs and inland drilling barges located in the U. S.
Gulf  of  Mexico  and  Trinidad,  as  well  as  land  drilling  units located in
Venezuela.  The  Company  provides  services  with  different  types of drilling
equipment  in several geographic regions. The location of the Company's rigs and
the  allocation  of  resources  to  build  or  upgrade rigs is determined by the
activities  and  needs  of  customers.

     Effective  January  1,  2002,  the  Company  changed the composition of its
reportable  segments  with the move of the responsibility for its Venezuela land
drilling  operations  to  the  Gulf  of Mexico Shallow and Inland Water segment.
Prior  periods  have  been  restated  to  reflect  the  change.


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


     Operating  revenues  and  income  before  income  taxes, minority interest,
extraordinary  item and cumulative effect of a change in accounting principle by
segment  are  as  follows  (in  millions):

<TABLE>
<CAPTION>
                                                                  Three Months Ended   Six Months Ended
                                                                        June 30,            June 30,
                                                                    ----------------  --------------------
                                                                     2002     2001      2002       2001
                                                                    -------  -------  ---------  ---------
<S>                                                                 <C>      <C>      <C>        <C>
Operating Revenues
   International and U.S. Floater Contract Drilling Services        $609.1   $598.6   $1,232.3   $1,065.2
   Gulf of Mexico Shallow and Inland Water                            37.1    153.9       81.8      243.3
   Elimination of intersegment revenues                                  -     (0.3)         -       (6.2)
                                                                    -------  -------  ---------  ---------
       Total Operating Revenues                                     $646.2   $752.2   $1,314.1   $1,302.3
                                                                    -------  -------  ---------  ---------

Income before Income Taxes, Minority Interest, Extraordinary Item
   and Cumulative Effect of a Change in Accounting Principle
   International and U.S. Floater Contract Drilling Services        $185.9   $156.3   $  380.8   $  233.5
   Gulf of Mexico Shallow and Inland Water                           (30.9)    36.5      (63.7)      48.5
                                                                    -------  -------  ---------  ---------
                                                                     155.0    192.8      317.1      282.0
Unallocated general and administrative expense                       (16.0)   (14.6)     (35.8)     (29.4)
Unallocated other income (expense)                                   (44.7)   (59.1)     (95.2)     (91.5)
                                                                    -------  -------  ---------  ---------
       Total Income before Income Taxes, Minority Interest,
         Extraordinary Item and Cumulative Effect of a Change
         in accounting Principle                                    $ 94.3   $119.1   $  186.1   $  161.1
                                                                    =======  =======  =========  =========
</TABLE>

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

                                                                                   June 30,   December 31,
                                                                                     2002         2001
                                                                                 ---------  -------------
<S>                                                                              <C>        <C>
   International and U.S. Floater Contract Drilling Services                     $13,960.1  $    14,219.3
   Gulf of Mexico Shallow and Inland Water                                         1,344.0        2,800.5
                                                                                 ---------  -------------
       Total Assets                                                              $15,304.1  $    17,019.8
                                                                                 =========  =============
</TABLE>

NOTE 8 -  ASSET  DISPOSITIONS  AND  IMPAIRMENT  LOSS

     In  June 2002, the Company sold a jackup rig, the RBF 209, and recognized a
net  after-tax  loss  of  $1.5  million.

     In March 2002, the Company sold two semisubmersible rigs, the Transocean 96
and  Transocean  97,  for  net  proceeds  of  $30.7  million, resulting in a net
after-tax  gain  of  $1.3  million.

     During  the  six months ended June 30, 2002, the Company sold certain other
non-strategic  assets acquired in the R&B Falcon merger and certain other assets
held  for  sale  for net proceeds of approximately $14.7 million, resulting in a
net  after-tax  gain  of  $0.7  million.

     In  March  2002,  the  Company recorded a non-cash impairment charge in the
Gulf of Mexico Shallow and Inland Water segment of $1.1 million. The impairment,
relating  to  an  asset  held  for  sale, resulted from deterioration in current
market  conditions. The impairment was determined and measured based on an offer
from  a  potential  buyer.

     In  February  2001, Sea Wolf Drilling Limited ("Sea Wolf"), a joint venture
in which the Company holds a 25 percent interest, sold two semisubmersible rigs,
the  Drill  Star  and  Sedco Explorer, to Pride International, Inc. In the first
quarter of 2001, the Company recognized accelerated amortization of the deferred
gain  related  to the Sedco Explorer of $18.5 million ($0.06 per diluted share),
which  is included in gain from sale of assets. The Company continued to operate
the  Drill  Star,  which  has  been  renamed  the  Pride North Atlantic, under a
bareboat  charter  agreement  until  October  2001,  at  which  time the rig was
returned  to  its  owner. The amortization of the Drill Star's deferred gain was


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


accelerated  and  produced  incremental  gains in the three and six months ended
June  30,  2001  of  $13.7  million  ($0.04 per diluted share) and $22.7 million
($0.07  per  diluted  share),  respectively, which is included as a reduction of
operating  and  maintenance  expense.

NOTE 9 -  EARNINGS PER SHARE

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

<TABLE>
<CAPTION>
                                                                   Three Months Ended       Six Months Ended
                                                                        June 30,                  June 30,
                                                                 -----------------------  -----------------------
                                                                    2002        2001         2002        2001
                                                                 ----------  -----------  ----------  -----------
<S>                                                              <C>         <C>          <C>         <C>
Income Before Extraordinary Item and Cumulative Effect of a
  Change in Accounting Principle                                 $     80.0  $     85.8   $   157.3   $    116.3
Loss on Extraordinary Item, net of tax                                    -       (17.3)          -        (17.3)
Cumulative Effect of a Change in Accounting Principle                     -           -    (1,363.7)           -
                                                                 ----------  -----------  ----------  -----------
Net Income (Loss)                                                $     80.0  $     68.5   $(1,206.4)  $     99.0
                                                                 ==========  ===========  ==========  ===========
Weighted-Average Shares Outstanding
Shares for basic earnings per share                                   319.1       318.2       319.1        299.5
Effect of dilutive securities:
    Employee stock options and unvested stock grants                    2.7         3.9         2.6          3.4
    Warrants to purchase ordinary shares                                2.1         2.9         1.9          2.4
                                                                 ----------  -----------  ----------  -----------
Adjusted weighted-average shares and assumed conversions for
  diluted earnings per share                                          323.9       325.0       323.6        305.3
                                                                 ==========  ===========  ==========  ===========
Basic Earnings (Loss) Per Share
  Income Before Extraordinary Item and Cumulative Effect of a
    Change in Accounting Principle                               $     0.25  $     0.27   $    0.49   $     0.39
  Loss on Extraordinary Item, net of tax                                  -       (0.05)          -        (0.06)
  Cumulative Effect of a Change in Accounting Principle                   -           -       (4.27)           -
                                                                 ----------  -----------  ----------  -----------
  Net Income (Loss)                                              $     0.25  $     0.22   $   (3.78)  $     0.33
                                                                 ==========  ===========  ==========  ===========
Diluted Earnings (Loss) Per Share
  Income Before Extraordinary Item and Cumulative Effect of a
    Change in Accounting Principle                               $     0.25  $     0.26   $    0.49   $     0.38
  Loss on Extraordinary Item, net of tax                                  -       (0.05)          -        (0.06)
  Cumulative Effect of a Change in Accounting Principle                   -           -       (4.22)           -
                                                                 ----------  -----------  ----------  -----------
  Net Income (Loss)                                              $     0.25  $     0.21   $   (3.73)  $     0.32
                                                                 ==========  ===========  ==========  ===========
</TABLE>

     Ordinary  shares subject to issuance pursuant to the conversion features of
the  Company's  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.

NOTE  10  -  CONTINGENCIES

     Legal  Proceedings  -  The Company was a defendant in Bryant, et al. v. R&B
Falcon  Drilling  USA,  Inc., et al. in the U.S. District Court for the Southern
District  of  Texas, Houston Division. R&B Falcon Drilling USA is a wholly owned
indirect subsidiary of R&B Falcon. In this suit, the plaintiffs alleged that R&B
Falcon  Drilling  USA,  the  Company  and  a  number  of other offshore drilling
contractors  with  operations in the U.S. Gulf of Mexico engaged in a conspiracy
to  depress  wages and benefits paid to certain of their offshore employees. The
plaintiffs  contended  that  this alleged conduct violated federal antitrust law
and  constituted unfair trade practices and wrongful employment acts under state
law.  The  plaintiffs sought treble damages, attorneys' fees and costs on behalf
of themselves and an alleged class of offshore workers, along with an injunction
against  exchanging  certain  wage  and  benefit information with other offshore
drilling  contractors  named  as defendants. In May 2001, the Company reached an
agreement  in  principle  with  the  plaintiffs'  counsel  to settle all claims,


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


pending  Court  approval  of  the settlement. In July 2001, before the Court had
considered  the  proposed settlement, the case, along with a number of unrelated
cases  also  pending  in  the  federal  court in Galveston, was transferred to a
federal  judge  sitting  in  Houston as a docket equalization measure. The judge
approved  the  settlement,  and  the funds were deposited with the court in June
2002.  The  terms of the settlement have been reflected in the Company's results
of  operations  for  the  first  quarter  of 2001. The settlement did not have a
material  adverse  effect  on  its  business or consolidated financial position.

     In  December 1998, Mobil North Sea Limited ("Mobil") purportedly terminated
its  contract  for  use  of the Jack Bates based on failure of two mooring lines
while  anchor  recovery  operations  at a Mobil well location had been suspended
during  heavy  weather.  The Company did not believe that Mobil had the right to
terminate  this contract. The Company later recontracted the Jack Bates to Mobil
at  a lower dayrate. The Company filed a request for arbitration with the London
Court  of  International  Arbitration  seeking  damages for the termination, and
Mobil  in  turn  counterclaimed  against  the  Company  seeking  damages for the
Company's  alleged  breaches  of  the original contract. The case was settled in
July  2002  and the proceedings dismissed. The ultimate outcome of this case did
not  have  a  material  adverse effect on the Company's business or consolidated
financial  position.

     In  March 1997, an action was filed by Mobil Exploration and Producing U.S.
Inc.  and  affiliates,  St.  Mary  Land & Exploration Company and affiliates and
Samuel  Geary and Associates, Inc. against Cliffs Drilling, its underwriters and
insurance  broker  in  the  16th  Judicial  District  Court  of St. Mary Parish,
Louisiana.  The plaintiffs alleged damages amounting to in excess of $50 million
in connection with the drilling of a turnkey well in 1995 and 1996. The case was
tried  before  a  jury  in  January  and  February 2000, and the jury returned a
verdict  of  approximately  $30  million  in  favor of the plaintiffs for excess
drilling  costs,  loss of insurance proceeds, loss of hydrocarbons and interest.
The  Company  has  appealed  such  judgment.  The  Company believes that all but
potentially  the  portion  of  the verdict representing excess drilling costs of
approximately  $4.7  million is covered by relevant primary and excess liability
insurance  policies  of  Cliffs Drilling; however, the insurers and underwriters
have  denied  coverage.  Cliffs Drilling has instituted litigation against those
insurers and underwriters to enforce its rights under the relevant policies. The
Company  does  not  expect  that  the  ultimate outcome of this case will have a
material  adverse  effect  on  its  business or consolidated financial position.

     The  Company  has  certain  other  actions or claims pending that have been
previously discussed and reported in the Company's Quarterly Report on Form 10-Q
for  the  three  months ended March 31, 2002, its Annual Report on Form 10-K for
the  year ended December 31, 2001 and the Company's other reports filed with the
Securities  and Exchange Commission. There have been no material developments in
these previously reported matters. The Company and its subsidiaries are involved
in  a  number of other lawsuits, all of which have arisen in the ordinary course
of the Company's business. The Company does not believe that ultimate liability,
if  any,  resulting  from any such other pending litigation will have a material
adverse  effect  on  its  business  or  consolidated  financial  position.

     Letters  of  Credit  and  Surety  Bonds - The Company had letters of credit
outstanding  at  June  30,  2002 totaling $63.9 million. These letters of credit
outstanding  guarantee  various  contract  bidding  and insurance activities. In
January 2002, the Company terminated its $70.0 million letter of credit facility
secured  by  mortgages  on  five  drilling  units,  the J.W. McLean, J.T. Angel,
Randolph  Yost,  D.R.  Stewart  and  George  H.  Galloway.

     As  is  customary  in  the contract drilling business, the Company also has
various  surety  bonds  totaling  $221.9  million  in  place that secure customs
obligations  relating  to the importation of rigs as well as certain performance
and  other  obligations.


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


NOTE 11 - SUBSEQUENT EVENTS

     In  July  2002, the Company announced that it plans to pursue a divestiture
of  its  Gulf  of Mexico Shallow and Inland Water business. Under this plan, the
Gulf  of  Mexico  Shallow  and Inland Water business would be separated from the
Company  and  established  as  a  publicly traded company. The Company currently
anticipates  that  it  will  establish  R&B  Falcon as the entity that owns this
business.  The  Company  plans to transfer assets not used in this business from
R&B  Falcon,  which  will  be renamed in connection with the transaction, to the
Company's  other  subsidiaries, and these internal transfers will not affect the
consolidated  financial statements of Transocean. The initial public offering of
that company is currently being prepared. The Company anticipates completing the
initial  public  offering  when  market  conditions  warrant, subject to various
factors.  Given  the  current  general  uncertainty  in  the equity markets, the
Company is unsure when the transaction could be completed on terms acceptable to
it.  The  Company expects to sell a portion of its interest in R&B Falcon in the
initial  public  offering.

     In  July  2002, the Company received a $4.2 million settlement of a loss of
hire  insurance  claim  for an incident that occurred in 1998 in which the Sedco
710  was  damaged  from  a collision with a supply boat.  The settlement will be
recorded  in  operating  revenues  in  the  third  quarter  of  2002.


                                       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 audited
consolidated  financial  statements  and  the  notes  thereto  included  in  the
Company's  Annual  Report  on  Form  10-K  for the year ended December 31, 2001.

OVERVIEW

     Transocean  Inc. (formerly known as "Transocean Sedco Forex Inc.", together
with  its  subsidiaries and predecessors, unless the context requires otherwise,
the  "Company,"  "Transocean,"  "we,"  "us" or "our") is a leading international
provider  of  offshore  and inland marine contract drilling services for oil and
gas  wells. As of July 31, 2002, we owned, had partial ownership interests in or
managed more than 150 mobile offshore and barge drilling units. As of this date,
our  active  fleet  of core assets consisted of 31 high-specification drillships
and  semisubmersibles  ("floaters"),  29  other  floaters,  52  jackup  rigs, 35
drilling  barges, four tenders and three submersible drilling rigs. In addition,
the  fleet  included  non-core  assets  consisting of a platform drilling rig, a
mobile  offshore  production  unit  and nine land drilling rigs in Venezuela. 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  management  of  third-party  well  service  activities.

     On  January  31,  2001,  we  completed a merger transaction 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  and  other  units  utilized in the support of
offshore  drilling  activities. 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.  The  condensed  consolidated statements of
operations  and  cash  flows  for  the  three and six months ended June 30, 2001
include  two  and five months, respectively, of operating results and cash flows
for  R&B  Falcon.

     On  May  9,  2002,  we changed our name from Transocean Sedco Forex Inc. to
Transocean  Inc.

     On  May 9, 2002, our Board of Directors voted to discontinue the payment of
a cash dividend after the cash dividend payable on June 13, 2002 to shareholders
of  record  on  May  30,  2002.

     Our  operations  are  aggregated  into  two  reportable  segments:  (i)
International  and  U.S.  Floater  Contract  Drilling  Services and (ii) Gulf of
Mexico  Shallow  and  Inland  Water. The International and U.S. Floater Contract
Drilling  Services  segment  consists  of  high-specification   floaters,  other
floaters,  non-U.S.  jackups,  other  mobile  offshore  drilling units and other
assets  used  in  support  of  offshore drilling activities and offshore support
services. The Gulf of Mexico Shallow and Inland Water segment consists of jackup
and  submersible  drilling  rigs and inland drilling barges located in the U. S.
Gulf  of  Mexico  and  Trinidad,  as  well  as  land  drilling  units located in
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.

     Effective  January  1,  2002,  we changed the composition of our reportable
segments  with  the  move  of the responsibility for our Venezuela land drilling
operations to the Gulf of Mexico Shallow and Inland Water segment. Prior periods
have  been  restated  to  reflect  the  change.

     In  July  2002,  we  announced plans to pursue a divestiture of our Gulf of
Mexico  Shallow  and Inland Water business.  Under this plan, our Gulf of Mexico
Shallow  and  Inland  Water  business  would  be  separated  from Transocean and
established  as  a publicly traded company. We currently anticipate that we will
establish  R&B Falcon as the entity that owns this business. We plan to transfer
assets  not  used  in  this  business  from R&B Falcon, which will be renamed in
connection  with  the transaction, to our other subsidiaries, and these internal
transfers  will  not affect the consolidated financial statements of Transocean.
The  initial  public  offering  is  currently  being  prepared.  We   anticipate
completing  the  initial public offering when market conditions warrant, subject
to various factors. Given the current general uncertainty in the equity markets,
we are unsure when the transaction could be completed on terms acceptable to us.
We  expect to sell a portion of our interest in R&B Falcon in the initial public
offering.


                                       19
<PAGE>
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. 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,   intangible  assets  and
goodwill,  income  taxes, financing operations, 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.

     We  believe  the following are our most critical accounting policies. These
policies  require significant judgments and estimates used in the preparation of
our  consolidated  financial  statements.

     Allowance  for  doubtful  accounts  -  We  establish  reserves for doubtful
accounts  on  a  case-by-case  basis  when  we  believe  the required payment of
specific  amounts  owed  to us is unlikely to occur. We derive a majority of our
revenue  from  services  to  international oil companies and government-owned or
government-controlled oil companies. Our receivables are concentrated in various
countries.  We  generally do not require collateral or other security to support
customer  receivables.  If  the  financial  condition  of  our  customers was to
deteriorate  or  their access to freely convertible currency was restricted, and
these  developments resulted in impairment of their ability to make the required
payments,  we  may  be  required  to  make  additional  allowances.

     Valuation  allowance  for  deferred  tax  assets  -  We  record a valuation
allowance  to  reduce  our deferred tax assets to the amount that is more likely
than  not  to  be  realized.  While we have considered future taxable income and
ongoing  prudent  and feasible tax planning strategies in assessing the need for
the  valuation  allowance,  should we determine that we would be able to realize
our  deferred  tax assets in the future in excess of our net recorded amount, an
adjustment  to  the valuation allowance would increase income in the period such
determination  was made. Likewise, should we determine that we would not be able
to  realize all or part of our net deferred tax asset in the future, we would be
required  to  make  an  adjustment to the valuation allowance. This would reduce
income  in  the  period  such  determination  was  made.

     Goodwill  impairment  - Effective January 1, 2002, we adopted the Financial
Accounting  Standards  Board's  ("FASB")  Statement  of  Financial  Accounting
Standards  ("SFAS")  142,  Goodwill  and  Other Intangibles. As a result of this
statement,  we  no  longer  amortize goodwill but will perform an annual test of
impairment.  Because  our  business  is  cyclical  in  nature, goodwill could be
significantly impaired depending on when in the business cycle the assessment is
performed.

     During  the  first  quarter  of  2002,  we  performed  the  initial test of
impairment  of  goodwill  on  our  two  reporting units, "International and U.S.
Floater  Contract  Drilling  Services"  and  "Gulf  of Mexico Shallow and Inland
Water."  The test was applied utilizing the fair value of the reporting units as
of  January  1, 2002 and was determined based on a combination of each reporting
unit's  discounted  cash  flows  and  publicly  traded  company  multiples  and
acquisition multiples of comparable businesses. There was no goodwill impairment
for  the  International  and  U.S.  Floater Contract Drilling Services reporting
unit.  However, because of continued deterioration in the Gulf of Mexico Shallow
and Inland Water business segment since the completion of the R&B Falcon merger,
we  recognized  a $1,363.7 million impairment of goodwill as a cumulative effect
of  a  change  in  accounting principle in the quarter ended March 31, 2002. Our
goodwill  balance,  after  giving  effect  to  the  goodwill write down, is $5.1
billion as of June 30, 2002. See Note 2 to our consolidated financial statements
in  our  Annual  Report  on  Form  10-K.


                                       20
<PAGE>
     Contingent  liabilities  -  We  establish  reserves  for  estimated  loss
contingencies  when we believe a loss is probable and we can reasonably estimate
the  amount  of  the  loss. Revisions to contingent liabilities are reflected in
income  in  the  period  in which different facts or information become known or
circumstances  change  that  affect our previous assumptions with respect to the
likelihood or amount of loss. Reserves for contingent liabilities are based upon
our  assumptions  and  estimates  regarding  the probable outcome of the matter.
Should  the  outcome  differ  from  our  assumptions  and estimates, we would be
required to make revisions to the estimated reserves for contingent liabilities.

     Contract  preparation  and  mobilization  revenues  and expenses - Costs we
incur  to  prepare  and  mobilize  drilling units for new drilling contracts are
deferred  from  the  date  we  have  a  firm  commitment  from  the customer and
recognized  as operating and maintenance expense over the estimated primary term
of  the  drilling  contract.  Revenues  we  earned  during or as a result of the
contract  preparation  and mobilization periods are also deferred and recognized
over  the  estimated  primary  term  of  the  drilling  contract.  If a customer
prematurely terminates the contract, we would recognize any unamortized deferred
costs  and  revenues  in  the  period  the  contract  was  terminated.

OPERATING RESULTS

QUARTER ENDED JUNE 30, 2002 COMPARED TO QUARTER ENDED JUNE 30, 2001

     Our  results  of  operations  are  aggregated  into  two  segments:  (i)
International  and  U.S.  Floater  Contract  Drilling  Services and (ii) Gulf of
Mexico  Shallow  and  Inland  Water.  Operating income (loss) before general and
administrative  expenses  for  the three months ended June 30, 2002 and 2001 was
$185.9  million  and $156.3 million, respectively, in our International and U.S.
Floater  Contract  Drilling  Services  segment  and  $(30.9)  million  and $36.5
million,  respectively,  in our Gulf of Mexico Shallow and Inland Water segment.


<TABLE>
<CAPTION>
                                                               Three Months Ended
                                                                     June 30,
                                                             ----------------------              %
                                                                2002        2001      Change   Change
                                                             ----------  ----------  --------  -------
                                                                   (In millions, except % change)
<S>                                                          <C>         <C>         <C>       <C>
OPERATING REVENUES
  International and U.S. Floater Contract Drilling Services  $    609.1  $    598.6  $  10.5      1.8%
  Gulf of Mexico Shallow and Inland Water                          37.1       153.6   (116.5)  (75.8)%
                                                             ----------  ----------  --------  -------
                                                             $    646.2  $    752.2  $(106.0)  (14.1)%
                                                             ==========  ==========  ========  =======
</TABLE>

     The  increase  in International and U.S. Floater Contract Drilling Services
operating  revenues  resulted  primarily  from  $26 million in revenues from two
newbuilds  placed  into  service subsequent to the second quarter of 2001 and $5
million  in revenues from two jackup rigs transferred into this segment from the
Gulf  of  Mexico  Shallow and Inland Water segment.  These increases were partly
offset  by  a  $12  million  decrease in revenues from three rigs transferred to
assets  held  for  sale  subsequent  to the second quarter of 2001, a $7 million
decrease  in  revenues  from  two  rigs sold subsequent to the second quarter of
2001,  a  $13  million  decrease  in revenues from three leased rigs returned to
their  owners  and  an $11 million decrease in revenues related to the Deepwater
Frontier  (See  " - Related Party Transactions") following the expiration of our
lease  with a related party late in 2001. Revenues for the remaining core assets
in this segment increased $37.3 million.  Average dayrates for these core assets
increased  from  $84,600  for the quarter ended June 30, 2001 to $93,700 for the
quarter  ended  June  30, 2002 while utilization for these core assets decreased
from  81  percent  for  the  quarter  ended  June 30, 2001 to 79 percent for the
quarter  ended  June  30,  2002.  Operating revenues for non-core assets in this
segment decreased $14 million and resulted primarily from the sale in the fourth
quarter  of  2001 of RBF FPSO L.P., which owned the Seillean, and the winding up
of  our  turnkey  drilling  business  early  in  2001.

     The  decrease  in  the  Gulf  of  Mexico Shallow and Inland Water operating
revenues  resulted  primarily  from the continued weakness of the Gulf of Mexico
shallow  and  inland water market segment, a decline that began in mid-2001, and
the  transfer  of  two  jackup rigs from this segment into the International and
U.S. Floater Contract Drilling Services segment, which represented a decrease of
$7  million  in  revenues.  Excluding  the  two jackup rigs transferred into the
International  and U.S. Floater Contract Drilling Services, average dayrates and


                                       21
<PAGE>
utilization  for  core  assets  in  this  segment  decreased from $31,300 and 71
percent,  respectively,  for  the  quarter ended June 30, 2001 to $20,700 and 27
percent,  respectively,  for  the  quarter  ended  June  30,  2002.

<TABLE>
<CAPTION>
                                                               Three Months Ended
                                                                     June 30,
                                                             ----------------------              %
                                                                2002        2001      Change   Change
                                                             ----------  ----------  --------  -------
                                                                   (In millions, except % change)
<S>                                                          <C>         <C>         <C>       <C>
OPERATING AND MAINTENANCE
  International and U.S. Floater Contract Drilling Services  $    320.1  $    316.1  $   4.0     1.3%
  Gulf of Mexico Shallow and Inland Water                          45.5        78.2    (32.7)  (41.8)%
                                                             ----------  ----------  --------  -------
                                                             $    365.6  $    394.3  $ (28.7)   (7.3)%
                                                             ==========  ==========  ========  =======
</TABLE>

     The  increase  in International and U.S. Floater Contract Drilling Services
operating expenses resulted primarily from two newbuilds placed into service and
two  jackup  rigs  transferred into this segment from the Gulf of Mexico Shallow
and  Inland  Water  segment  subsequent  to  the  second quarter of 2001 and the
accelerated  amortization  of  the  Drill  Star's  deferred gain, which produced
incremental  gains in the quarter ended June 30, 2001 of $13.7 million ($.04 per
diluted  share),  with  no equivalent expense reduction in the second quarter of
2002.  These  increases  were partly offset by a decrease in expenses from three
rigs  transferred  to  assets  held for sale subsequent to the second quarter in
2001,  a  decrease  in  expenses  from  nine  rigs sold subsequent to the second
quarter in 2001, a decrease in expenses from three leased rigs returned to their
owners  and  a  decrease  in expenses related to the Deepwater Frontier (See " -
Related Party Transactions) following the expiration of our lease with a related
party  late  in  2001.

     The  decrease in Gulf of Mexico Shallow and Inland Water operating expenses
was primarily a result of lower costs in 2002 resulting from stacking idle rigs,
reducing  employee  count  and postponing maintenance projects, coupled with the
transfer  of two jackup rigs out of this segment into the International and U.S.
Floater  Contract  Drilling Services segment subsequent to the second quarter of
2001.

<TABLE>
<CAPTION>
                                                               Three Months Ended
                                                                     June 30,
                                                             ----------------------              %
                                                                2002        2001      Change   Change
                                                             ----------  ----------  --------  -------
                                                                   (In millions, except % change)
<S>                                                          <C>         <C>         <C>       <C>
DEPRECIATION
  International and U.S. Floater Contract Drilling Services  $    101.4  $     95.2  $   6.2     6.5%
  Gulf of Mexico Shallow and Inland Water                          22.9        28.5     (5.6)  (19.6)%
                                                             ----------  ----------  --------  -------
                                                             $    124.3  $    123.7  $   0.6     0.5 %
                                                             ==========  ==========  ========  =======
</TABLE>

     The  increase  in International and U.S. Floater Contract Drilling Services
depreciation expense resulted primarily from four newbuild drilling units placed
into  service  during  and  subsequent  to  the  second  quarter of 2001 and the
transfer  of  two  jackup rigs into this segment from the Gulf of Mexico Shallow
and Inland Water segment subsequent to the second quarter of 2001. This increase
was  partially  offset  by  lower  expense  resulting  from  the  suspension  of
depreciation on certain rigs transferred to assets held for sale and the sale of
various  rigs  from  our  active fleet subsequent to the second quarter of 2001.

     The  decrease  in  Gulf  of  Mexico  Shallow  and Inland Water depreciation
expense  resulted  primarily  from  the  movement of two jackup rigs out of this
segment  into  the  International  and  U.S.  Floater Contract Drilling Services
segment subsequent to the second quarter of 2001, the suspension of depreciation
on certain rigs transferred to assets held for sale and the sale of various rigs
from  our  active  fleet  subsequent  to  the  second  quarter  of  2001.


                                       22
<PAGE>
<TABLE>
<CAPTION>
                                                               Three Months Ended
                                                                   June 30,
                                                             ----------------------               %
                                                                2002        2001      Change    Change
                                                             ----------  ----------  --------  --------
                                                                   (In millions, except % change)
<S>                                                          <C>         <C>         <C>       <C>
GOODWILL AMORTIZATION
  International and U.S. Floater Contract Drilling Services  $        -  $     30.2  $ (30.2)  (100.0)%
  Gulf of Mexico Shallow and Inland Water                             -        11.2    (11.2)  (100.0)%
                                                             ----------  ----------  --------  --------
                                                             $        -  $     41.4  $ (41.4)  (100.0)%
                                                             ==========  ==========  ========  ========
</TABLE>

     We adopted SFAS 142, Goodwill and Other Intangible Assets, as of January 1,
2002.  As  a  result,  goodwill  is no longer amortized but is reviewed at least
annually  for  impairment.  See  Note  2 to our condensed consolidated financial
statements.

<TABLE>
<CAPTION>
                                                                Three Months Ended
                                                                     June 30,
                                                              ----------------------             %
                                                                 2002        2001     Change   Change
                                                              ----------  ----------  -------  -------
                                                                    (In millions, except % change)
<S>                                                           <C>         <C>         <C>      <C>

GENERAL AND ADMINISTRATIVE                                    $     16.0  $     14.6  $   1.4     9.6%
                                                              ==========  ==========  =======  =======
</TABLE>

     General and administrative expense for the three months ended June 30, 2001
included a credit of $1.3 million attributable to the favorable settlement of an
unemployment  tax  assessment.

<TABLE>
<CAPTION>
                                                                Three Months Ended
                                                                     June 30,
                                                             ------------------------               %
                                                                2002         2001       Change    Change
                                                             -----------  -----------  --------  --------
<S>                                                          <C>          <C>          <C>       <C>
                                                                    (In millions, except % change)
GAIN (LOSS) FROM SALE OF ASSETS, NET
  International and U.S. Floater Contract Drilling Services  $     (1.7)  $     (0.8)  $  (0.9)  (112.5)%
  Gulf of Mexico Shallow and Inland Water                           0.4          0.8      (0.4)   (50.0)%
                                                             -----------  -----------  --------  --------
                                                             $     (1.3)  $        -   $  (1.3)  (100.0)%
                                                             ===========  ===========  ========  ========
</TABLE>

     During  the  three  months  ended June 30, 2002, the International and U.S.
Floater  Contract  Drilling  Services  segment recognized a pre-tax loss of $2.4
million  from  the sale of the RBF 209 partially offset by a net pre-tax gain of
$0.7  million  related  to the sale of certain non-strategic assets.  During the
three  months ended June 30, 2001, net pre-tax losses of $0.8 million related to
the  sale  of  certain  non-strategic  assets.

     During  the three months ended June 30, 2002 and June 30, 2001, the Gulf of
Mexico  Shallow  and  Inland  Water segment recognized net pre-tax gains of $0.4
million  and  $0.8  million,  respectively,  related  to  the  sale  of  certain
non-strategic  assets.


                                       23
<PAGE>
<TABLE>
<CAPTION>
                                                Three Months Ended
                                                      June 30,
                                              ------------------------              %
                                                 2002         2001       Change   Change
                                              -----------  -----------  --------  -------
                                                     (In millions, except % change)
<S>                                           <C>          <C>          <C>       <C>
OTHER INCOME (EXPENSE), NET
  Equity in earnings of joint ventures        $      2.5   $      4.0   $  (1.5)  (37.5)%
  Interest income                                    5.7          4.7       1.0     21.3%
  Interest expense, net of amounts capitalized     (52.5)       (66.8)     14.3     21.4%
  Other, net                                        (0.4)        (1.0)      0.6     60.0%
                                              -----------  -----------  --------  -------
                                              $    (44.7)  $    (59.1)  $  14.4     24.4%
                                              ===========  ===========  ========  =======
</TABLE>

     The  decrease in equity in earnings of joint ventures was primarily related
to  our  60  percent  share of earnings from Deepwater Drilling II L.L.C. ("DDII
LLC"),  which  owns  the  Deepwater  Frontier.  The  rig  experienced  decreased
utilization  in  the second quarter of 2002 compared to the same period in 2001.
The  increase  in interest income was primarily due to interest earned on higher
average  cash  balances for the three months ended June 30, 2002 compared to the
same  period  in  2001.  The  decrease  in  interest expense was attributable to
reductions  in interest expense of $8.0 million associated with debt refinancing
and  retirements during and subsequent to the second quarter of 2001, a decrease
in the London Interbank Offered Rate ("LIBOR") of approximately 260 basis points
that  resulted  in a $2.8 million reduction in interest expense on floating rate
debt  and a decrease of $0.7 million resulting from amortization of debt-related
items.  Additionally,  we  entered  into  interest  rate swaps subsequent to the
second  quarter  of  2001  that reduced interest expense by $13.5 million. These
decreases  were  partially  offset  by  an  increase of $0.6 million in interest
expense  attributable  to  a  full  quarter of interest expense on debt incurred
during the second quarter of 2001 and the absence of capitalized interest in the
second  quarter of 2002 compared to $9.4 million of capitalized interest for the
same  period  in  2001  due  to the completion of our newbuild projects in 2001.

<TABLE>
<CAPTION>
                                    Three Months Ended
                                         June 30,
                                  ---------------------                %
                                     2002        2001      Change   Change
                                  ----------  ----------  --------  -------
<S>                               <C>         <C>         <C>       <C>
                                        (In millions, except % change)

INCOME TAX EXPENSE                $     13.9  $     32.2  $ (18.3)  (56.8)%
                                  ==========  ==========  ========  =======
</TABLE>

     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.

<TABLE>
<CAPTION>
                                           Three Months Ended
                                                June 30,
                                         -----------------------              %
                                            2002        2001      Change   Change
                                         ----------  -----------  -------  -------
<S>                                      <C>         <C>          <C>      <C>
                                              (In millions, except % change)

LOSS ON EXTRAORDINARY ITEMS, NET OF TAX  $        -  $    (17.3)  $  17.3   100.0%
                                         ----------  -----------  -------  -------
</TABLE>

     During  the three months ended June 30, 2001, we recognized a $17.3 million
extraordinary  loss,  net of tax, related to the early extinguishment of debt as
described  in  Note  4  to  our  condensed  consolidated  financial  statements.


                                       24
<PAGE>
SIX MONTHS ENDED JUNE 30, 2002 COMPARED TO SIX MONTHS ENDED JUNE 30, 2001

     Our  results  of  operations  are  aggregated  into  two  segments:  (i)
International  and  U.S.  Floater  Contract  Drilling  Services and (ii) Gulf of
Mexico  Shallow  and  Inland  Water.  Operating income (loss) before general and
administrative  expenses  for  the  six  months ended June 30, 2002 and 2001 was
$380.8  million  and $233.5 million, respectively, in our International and U.S.
Floater  Contract  Drilling  Services  segment  and  $(63.7)  million  and $48.5
million,  respectively,  in our Gulf of Mexico Shallow and Inland Water segment.

<TABLE>
<CAPTION>
                                                               Six Months Ended
                                                                   June 30,
                                                             --------------------               %
                                                               2002       2001      Change   Change
                                                             --------  ----------  --------  -------
<S>                                                          <C>       <C>         <C>       <C>
                                                                 (In millions, except % change)
OPERATING REVENUES
  International and U.S. Floater Contract Drilling Services  $1,232.3  $  1,065.2  $ 167.1     15.7%
  Gulf of Mexico Shallow and Inland Water                        81.8       237.1   (155.3)  (65.5)%
                                                             --------  ----------  --------  -------
                                                             $1,314.1  $  1,302.3  $  11.8      0.9%
                                                             ========  ==========  ========  =======
</TABLE>

     The  increase  in International and U.S. Floater Contract Drilling Services
operating  revenues  resulted  from  a $94 million increase in revenues from R&B
Falcon core assets in this segment representing a full six months of revenues in
2002  compared  to five months of operations in 2001 and $77 million in revenues
from  four  newbuild drilling units placed into service during and subsequent to
the  second  quarter  of  2001.  In  addition,  operating  revenues  relating to
historical  Transocean core assets totaled $739 million for the six months ended
June  30,  2002,  representing  a  $90 million, or 14 percent, increase over the
comparable  2001  period.  Average  dayrates  and  utilization  for  core assets
included  in  this  segment increased from $81,200 and 81 percent, respectively,
for  the six months ended June 30, 2001 to $89,300 and 83 percent, respectively,
for  the six months ended June 30, 2002. These increases were partly offset by a
$19  million  decrease  in  revenues  related to the Deepwater Frontier (See " -
Related  Party  Transactions")  following  the  expiration  of  our lease with a
related  party  late  in  2001,  a  $20  million decrease from three leased rigs
returned to their owners, a $10 million decrease related to a rig transferred to
held  for sale and a $6 million decrease in revenues related to rigs sold during
2002.  Revenues  from  non-core  assets decreased $55 million for the six months
ended  June  30,  2002  compared to the same period in 2001 primarily due to the
sale  of  the RBF FPSO L.P., which owned the Seillean, and a decrease in turnkey
drilling  revenues  of $38 million due to the winding up of our turnkey drilling
business  early  in  2001.

     Although  the  Gulf  of  Mexico Shallow and Inland Water operating revenues
represent  a  full  six  months of operations in 2002 compared to five months of
operations  in  2001,  revenues decreased mainly due to the further weakening of
the Gulf of Mexico Shallow and Inland Water market segment, a decline that began
in  mid-2001.  In  addition,  the  transfer of two jackup rigs from this segment
into  the  International  and  U.S.  Floater  Contract Drilling Services segment
resulted  in  a  $12  million  decrease in operating revenues. Excluding the two
jackup  rigs  transferred  into  the  International  and  U.S.  Floater Contract
Drilling  Services,  average  dayrates  and  utilization for core assets in this
segment  decreased from $29,800 and 71 percent, respectively, for the six months
ended  June 30, 2001 to $20,500 and 29 percent, respectively, for the six months
ended  June  30,  2002.


                                       25
<PAGE>
<TABLE>
<CAPTION>
                                                               Six Months Ended
                                                                   June 30,
                                                             --------------------               %
                                                               2002       2001      Change   Change
                                                             --------  ----------  --------  -------
<S>                                                          <C>       <C>         <C>       <C>
                                                                  (In millions, except % change)
OPERATING AND MAINTENANCE
  International and U.S. Floater Contract Drilling Services  $  648.8  $    623.1  $  25.7      4.1%
  Gulf of Mexico Shallow and Inland Water                        97.8       122.1    (24.3)  (19.9)%
                                                             --------  ----------  --------  -------
                                                             $  746.6  $    745.2  $   1.4      0.2%
                                                             ========  ==========  ========  =======
</TABLE>

     The  increase  in International and U.S. Floater Contract Drilling Services
operating  expenses  was  primarily  a  result  of  five  months  of  R&B Falcon
operations  for the six months ended June 30, 2001 compared to a full six months
of  activity  for  the  same  period  in  2002,  the activation of four newbuild
drilling  units  and two jackup rigs transferred into this segment from the Gulf
of  Mexico  Shallow and Inland Water segment during and subsequent to the second
quarter  of 2001 and accelerated amortization of the Drill Star's deferred gain,
which  produced incremental gains in the six months ended June 30, 2001 of $22.7
million  ($.07  per  diluted  share) with no equivalent expense reduction in the
second  quarter  of  2002.  These  increases were partly offset by a decrease in
expenses  resulting from a rig transferred to assets held for sale subsequent to
the  second  quarter  in 2001, a decrease in expenses relating to nine rigs sold
subsequent  to  the  second  quarter  in 2001, a decrease in expenses related to
three  leased  rigs  returned to their owners, a decrease in expenses related to
the  Deepwater  Frontier  (See  "  -  Related Party Transactions") following the
expiration  of our lease with a related party late in 2001 and the winding up of
our  turnkey  drilling  business  in  2001.

     The  decrease in Gulf of Mexico Shallow and Inland Water operating expenses
in  the  six  months  ended  June 30, 2002 resulted primarily from stacking idle
rigs,  reducing  employee count and postponing maintenance projects coupled with
the  transfer  of two jackup rigs out of this segment into the International and
U.S. Floater Contract Drilling Services segment subsequent to the second quarter
of  2001.  This decrease was partially offset by a full six months of R&B Falcon
operations  in  2002  compared  to  five  months  of  operations  in  2001.

<TABLE>
<CAPTION>
                                                              Six Months Ended
                                                                   June 30,
                                                             --------------------              %
                                                               2002       2001      Change   Change
                                                             --------  ----------  --------  -------
<S>                                                          <C>       <C>         <C>       <C>
                                                                 (In millions, except % change)
DEPRECIATION
  International and U.S. Floater Contract Drilling Services  $  203.7  $    174.7  $  29.0     16.6%
  Gulf of Mexico Shallow and Inland Water                        46.2        48.4     (2.2)   (4.5)%
                                                             --------  ----------  --------  -------
                                                             $  249.9  $    223.1  $  26.8     12.0%
                                                             ========  ==========  ========  =======
</TABLE>

     The  increase  in International and U.S. Floater Contract Drilling Services
depreciation  expense  resulted primarily from a full six months of depreciation
in  2002  on  rigs acquired in the R&B Falcon merger compared to five months for
the  same  period in 2001, depreciation expense for four newbuild drilling units
placed  into  service  during and subsequent to the first six months of 2001 and
the  transfer  of  two  jackup  rigs  into  this segment from the Gulf of Mexico
Shallow  and  Inland  Water segment. This increase was partially offset by lower
expense  due  to  the  suspension of depreciation on certain rigs transferred to
assets held for sale and the sale of various rigs, classified as assets held and
used  subsequent  to  the  second  quarter  of  2001.

     The  decrease  in  Gulf  of  Mexico  Shallow  and Inland Water depreciation
expense  resulted  primarily  from  the  transfer of two jackup rigs out of this
segment  into  the  International  and  U.S.  Floater Contract Drilling Services
segment and the suspension of depreciation on certain rigs transferred to assets
held  for  sale  and the sale of various rigs classified as assets held and used
subsequent  to the second quarter of 2001. These decreases were partially offset
by  a full six months of depreciation in 2002 on rigs acquired in the R&B Falcon
merger  compared  to  five  months  for  the  same  period  in  2001.


                                       26
<PAGE>
<TABLE>
<CAPTION>
                                                               Six Months Ended
                                                                  June 30,
                                                             --------------------               %
                                                               2002       2001      Change    Change
                                                             --------  ----------  --------  --------
<S>                                                          <C>       <C>         <C>       <C>
                                                                   (In millions, except % change)
GOODWILL AMORTIZATION
  International and U.S. Floater Contract Drilling Services  $      -  $     53.0  $ (53.0)  (100.0)%
  Gulf of Mexico Shallow and Inland Water                           -        18.6    (18.6)  (100.0)%
                                                             --------  ----------  --------  --------
                                                             $      -  $     71.6  $ (71.6)  (100.0)%
                                                             ========  ==========  ========  ========
</TABLE>

     We adopted SFAS 142, Goodwill and Other Intangible Assets, as of January 1,
2002.  As  a  result,  goodwill  is no longer amortized but is reviewed at least
annually  for  impairment.  See  Note  2 to our condensed consolidated financial
statements.

<TABLE>
<CAPTION>
                                                                Six Months Ended
                                                                     June 30,
                                                              --------------------             %
                                                                2002       2001     Change   Change
                                                              --------  ----------  -------  -------
<S>                                                           <C>       <C>         <C>      <C>
                                                                   (In millions, except % change)

GENERAL AND ADMINISTRATIVE                                    $   35.8  $     29.4  $   6.4    21.8%
                                                              ========  ==========  =======  =======
</TABLE>

     The  increase  in  general  and  administrative  expense  was  primarily
attributable  to  $3.9  million of costs related to the exchange of our debt for
R&B  Falcon  debt  in  March 2002. The six months ended June 30, 2001 included a
$1.3  million  reduction  in  expense  related to the favorable settlement of an
unemployment  tax  assessment.  In  addition,  expense  increased due to the R&B
Falcon  merger  and  reflects  additional costs to manage a larger, more complex
organization  for  a  full  six  months in 2002 compared to five months in 2001.

<TABLE>
<CAPTION>
                                         Six Months Ended
                                             June 30,
                                      ---------------------                %
                                        2002        2001      Change    Change
                                      ---------  ----------  --------  --------
<S>                                   <C>        <C>         <C>       <C>
                                            (In millions, except % change)

IMPAIRMENT LOSS ON LONG-LIVED ASSETS  $   (1.1)  $       -   $  (1.1)  (100.0)%
                                      =========  ==========  ========  ========
</TABLE>

     During  the  six  months  ended  June  30,  2002,  we  recorded  a non-cash
impairment charge in the Gulf of Mexico Shallow and Inland Water segment of $1.1
million.  The  impairment,  relating  to  an  asset held for sale, resulted from
deterioration  in  current  market conditions. The impairment was determined and
measured  based  on  an  offer  from  a  potential  buyer.


                                       27
<PAGE>
<TABLE>
<CAPTION>
                                                               Six Months Ended
                                                                    June 30,
                                                             ---------------------               %
                                                               2002        2001      Change    Change
                                                             ---------  ----------  --------  --------
<S>                                                          <C>        <C>         <C>       <C>
                                                                  (In millions, except % change)
GAIN FROM SALE OF ASSETS, NET
  International and U.S. Floater Contract Drilling Services  $    1.0   $     19.1  $ (18.1)   (94.8)%
  Gulf of Mexico Shallow and Inland Water                        (0.4)         0.5     (0.9)  (180.0)%
                                                             ---------  ----------  --------  --------
                                                             $    0.6   $     19.6  $ (19.0)   (96.9)%
                                                             =========  ==========  ========  ========
</TABLE>

     During  the  six  months  ended  June  30, 2002, the International and U.S.
Floater  Contract Drilling Services segment recognized net pre-tax gains of $3.4
million  related  to  the  sale  of  the  Transocean 96, Transocean 97, a mobile
offshore production unit and the sale of certain non-strategic assets. These net
gains  were partially offset by a net pre-tax loss of $2.4 million from the sale
of  the  RBF  209.  During the six months ended June 30, 2001, we recognized net
pre-tax  gains  of  $18.5 million related to the accelerated amortization of the
deferred  gain  on the sale of the Sedco Explorer and $0.6 million from the sale
of  certain  non-strategic  assets.

     During  the  six months ended June 30, 2002, the Gulf of Mexico Shallow and
Inland  Water  segment  recognized net pre-tax losses of $1.4 million related to
the  sale  of  two  mobile  offshore  production units and a land rig, partially
offset by net pre-tax gains of $1.0 million on the sale of certain non-strategic
assets.  During  the  six  months ended June 30, 2001, we recognized net pre-tax
gains  of  $0.5  million  from  the  sale  of  certain  non-strategic  assets.

<TABLE>
<CAPTION>
                                                   Six Months Ended
                                                       June 30,
                                                ----------------------              %
                                                  2002        2001       Change   Change
                                                ---------  -----------  --------  -------
<S>                                             <C>        <C>          <C>       <C>
                                                     (In millions, except % change)
OTHER INCOME (EXPENSE), NET
  Equity in earnings of joint ventures          $    4.4   $      5.7   $  (1.3)  (22.8)%
  Interest income                                    9.9          8.3       1.6     19.3%
  Interest expense, net of amounts capitalized    (108.4)      (104.0)     (4.4)   (4.2)%
  Other, net                                        (1.1)        (1.5)      0.4     26.7%
                                                ---------  -----------  --------  -------
                                                $  (95.2)  $    (91.5)  $  (3.7)   (4.0)%
                                                =========  ===========  ========  =======
</TABLE>

     The  decrease in equity in earnings of joint ventures was primarily related
to  our  60  percent share of the earnings of DDII LLC, which owns the Deepwater
Frontier. The rig experienced shipyard downtime and decreased utilization during
the  first  six  months  of  2002.  This decrease was partially offset by losses
recorded  in February 2001 on the sale of the Drill Star and Sedco Explorer by a
joint  venture  in which we own a 25% interest.  The increase in interest income
was primarily due to interest earned on higher average cash balances for the six
months  ended June 30, 2002 compared to the same period in 2001. The increase in
interest  expense was attributable to the absence of capitalized interest in the
first  six months of 2002 due to the completion of our newbuild projects in 2001
compared  to  $30.5 million of capitalized interest for the same period in 2001.
Also  contributing  to  the  increase  were $25.2 million of additional interest
expense  on  debt  issued  during the second quarter of 2001 and $8.7 million of
interest  expense  on  debt  acquired in the R&B Falcon merger, which represents
additional  interest in the full six months ended June 30, 2002 compared to five
months  for  the  comparable  period  in  2001.  Offsetting these increases were
reductions in interest expense of $26.3 million associated with debt refinancing
and  retirements during and subsequent to the second quarter of 2001, a decrease
in  LIBOR  of  approximately  335  basis  points that resulted in a $7.0 million
reduction  in  interest  expense  on  floating rate debt and interest rate swaps
entered  into  during  and subsequent to June 2001 that further reduced interest
expense  $25.0  million.


                                       28
<PAGE>
<TABLE>
<CAPTION>
                                          Six Months Ended
                                              June 30,
                                        --------------------               %
                                          2002       2001      Change   Change
                                        --------  ----------  --------  -------
<S>                                     <C>       <C>         <C>       <C>
                                            (In millions, except % change)

INCOME TAX EXPENSE                      $   27.7  $     42.3  $ (14.6)  (34.5)%
                                        ========  ==========  ========  =======
</TABLE>

     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.

<TABLE>
<CAPTION>
                                           Six Months Ended
                                               June 30,
                                         ---------------------             %
                                           2002       2001      Change   Change
                                         --------  -----------  -------  -------
<S>                                      <C>       <C>          <C>      <C>
                                            (In millions, except % change)

LOSS ON EXTRAORDINARY ITEMS, NET OF TAX  $      -  $    (17.3)  $  17.3   100.0%
                                         ========  ===========  =======  =======
</TABLE>

     During  the  six  months ended June 30, 2001, we recognized a $17.3 million
extraordinary  loss,  net of tax, related to the early extinguishment of debt as
described  in  Note  4  to  our  condensed  consolidated  financial  statements.

<TABLE>
<CAPTION>
                                                          Six Months Ended
                                                              June 30,
                                                       ----------------------                 %
                                                          2002        2001       Change     Change
                                                       ----------  ----------  ----------  --------
<S>                                                    <C>         <C>         <C>         <C>
                                                              (In millions, except % change)

CUMULATIVE EFFECT OF A CHANGE IN ACCOUNTING PRINCIPLE  $(1,363.7)  $        -  $(1,363.7)  (100.0)%
                                                       ==========  ===========  =========  ========
</TABLE>

     During the six months ended June 30, 2002, we recognized a $1,363.7 million
cumulative  effect  of  a  change  in  accounting  principle  related  to  the
implementation  of  SFAS  142 as more fully described in Note 2 to our condensed
consolidated  financial  statements.

FINANCIAL  CONDITION

<TABLE>
<CAPTION>
                                                             June 30,   December 31,                  %
                                                               2002         2001         Change    Change
                                                             ---------  -------------  ----------  -------
<S>                                                          <C>        <C>            <C>         <C>
TOTAL ASSETS
  International and U.S. Floater Contract Drilling Services  $13,960.1  $    14,219.3  $  (259.2)   (1.8)%
  Gulf of Mexico Shallow and Inland Water                      1,344.0        2,800.5   (1,456.5)  (52.0)%
                                                             ---------  -------------  ----------  -------
                                                             $15,304.1  $    17,019.8  $(1,715.7)  (10.1)%
                                                             =========  =============  ==========  =======
</TABLE>

     The  decrease  in International and U.S. Floater Contract Drilling Services
assets  was  primarily due to a decrease in temporary investments resulting from
the  repayment  of  commercial paper borrowings of $326 million. The decrease in
Gulf  of  Mexico  Shallow  and  Inland  Water  assets  was  primarily due to the
impairment  of  goodwill of $1.4 billion as a result of our adoption of SFAS 142
in  January  2002.

RESTRUCTURING  CHARGES

     In  conjunction  with  the R&B Falcon merger, we established a liability of
$16.5  million  for  the  estimated  severance-related costs associated with the
involuntary  termination  of  569  R&B Falcon employees pursuant to management's
plan  to  consolidate  operations  and  administrative  functions  post-merger.
Included  in the 569 planned involuntary terminations were 387 employees engaged


                                       29
<PAGE>
in  our  land drilling business in Venezuela. We have suspended active marketing
efforts  to  divest  this business and, as a result, the estimated liability was
reduced by $4.3 million in the third quarter of 2001 with an offset to goodwill.
Through June 30, 2002 all required severance-related costs have been paid to 182
employees  whose  positions  were  eliminated  as  a  result  of  this  plan.

2001  R&B  FALCON  PRO  FORMA  OPERATING  RESULTS

     Our  unaudited pro forma consolidated results for the six months ended June
30, 2001, giving effect to the R&B Falcon merger, reflected net income of $102.0
million, or $0.31 per diluted share, on pro forma operating revenues of $1,428.1
million.  The  pro forma operating results assume the merger was completed as of
January 1, 2001 (see Note 3 to our condensed consolidated financial statements).
These  pro  forma  results  do  not  reflect the effects of reduced depreciation
expense  related to conforming the estimated lives of our drilling rigs. The pro
forma  financial  data  should  not  be  relied on as an indication of operating
results that we would have achieved had the merger taken place earlier or of the
future  results  that  we  may  achieve.

OUTLOOK

     Average  dayrates  increased  moderately  within our International and U.S.
Floater  Contract  Drilling  Services  business segment, due largely to improved
utilization  of  our  high-specification  floaters,  while our fleet utilization
within  the  segment  declined during the second quarter of 2002 compared to the
first  quarter  of  this  year. The segment's operating results trended slightly
downward  in  the  second quarter of 2002 due principally to a decline in demand
for  semisubmersibles  and  drillships with water depth drilling capabilities of
300  feet  up  to 3,500 feet. Within our Gulf of Mexico Shallow and Inland Water
business  segment,  average  dayrates increased slightly while fleet utilization
decreased  in  the  second quarter of 2002 compared to the immediately preceding
quarter.


                                       30
<PAGE>
     Comparative  average  dayrates  and  utilization  figures  for the quarters
ending  June  30,  2002  and  2001 and the quarter ending March 31, 2002 are set
forth  in  the  table  below.

<TABLE>
<CAPTION>
                                                                             Three Months Ended
                                                                     -----------------------------------
                                                                      June 30,    March 31,    June 30,
                                                                        2002        2002         2001
                                                                     ----------  -----------  ----------
<S>                                                                  <C>         <C>          <C>
AVERAGE DAYRATES

INTERNATIONAL AND U.S. FLOATER CONTRACT DRILLING SERVICES SEGMENT:
  High-Specification Floaters                                        $ 150,200   $  145,500   $ 141,600
  Other Floaters                                                        76,800       77,300      62,600
  Jackups - Non-U.S.                                                    57,700       58,800      44,100
  Other (a)                                                             43,700       43,900      37,000
                                                                     ----------  -----------  ----------
Segment Total (a)                                                       94,600       91,000      82,000
                                                                     ----------  -----------  ----------
GULF OF MEXICO SHALLOW AND INLAND WATER SEGMENT:
  Jackups and Submersibles                                              21,100       22,200      39,800
  Inland Barges                                                         20,200       19,200      23,100
                                                                     ----------  -----------  ----------
Segment Total (a)                                                       20,700       20,300      31,800
                                                                     ----------  -----------  ----------

Total Mobile Offshore Drilling Fleet (a)                             $  80,700   $   76,600   $  62,900
                                                                     ==========  ===========  ==========
UTILIZATION

INTERNATIONAL AND U.S. FLOATER CONTRACT DRILLING SERVICES SEGMENT:
  High-Specification Floaters                                               85%          82%         86%
  Other Floaters                                                            73%          82%         84%
  Jackups - Non-U.S.                                                        82%          90%         85%
  Other (a)                                                                 60%          57%         53%
                                                                     ----------  -----------  ----------
Segment Total (a)                                                           78%          82%         82%
                                                                     ----------  -----------  ----------
GULF OF MEXICO SHALLOW AND INLAND WATER SEGMENT:
  Jackups and Submersibles                                                  29%          22%         72%
  Inland Barges                                                             24%          41%         71%
                                                                     ----------  -----------  ----------
Segment Total (a)                                                           27%          31%         71%
                                                                     ----------  -----------  ----------
Total Mobile Offshore Drilling Fleet (a)                                    57%          61%         78%
                                                                     ==========  ===========  ==========
</TABLE>

     ---------------
     (a)  Average  dayrates  and  utilization  figures  do  not include non-core
          assets, which consist of our platform rigs, mobile offshore production
          units  and  Venezuelan  land  rigs,  as  well as for prior periods our
          service  vessels,  which  were  sold  prior  to  June  30,  2002.

     Demand  for  our drilling rigs is driven largely by our clients' perception
of  future  commodity prices. World oil prices have been stable so far this year
and  U.S. natural gas prices have rebounded compared to the latter part of 2001,
although  there  has  been  some  recent  weakness. We believe that drilling rig
supply  and  demand  are  still  close  to balanced in market sectors around the
world, other than the existing general oversupply of rigs in the Norway and U.K.
sectors  of  the  North  Sea  and  the U.S. Gulf of Mexico. Generally, we do not
expect  significant changes in the overall global drilling rig supply and demand
during  the  remainder  of  the  year.


                                       31
<PAGE>
     We  do  not  foresee  a  significant  increase in overall demand within our
International  and  U.S.  Floater Contract Drilling Services segment in the near
term.  We  expect  continued general weakness in Norway and the U.K. through the
rest  of  the  year for all classes of rigs.  Similarly, we still do not foresee
any significant improvement in the U.S. Gulf of Mexico high-specification sector
until  mobilizations  to  other  regions occur or further meaningful development
programs  come  online.  We  expect  to  see  some  additional  U.S.  deepwater
development programs during 2003, although market and other factors could affect
timing  and  the  extent  of  development.  We  are  still  monitoring potential
opportunities  in India, although the timing of the projects is still uncertain.
We  believe  the international jackup market sector should be stable to slightly
improved during the rest of this year, buoyed by strong market segments in India
and  Asia.  We  expect  the conventional semisubmersible market sector to remain
weak  for  the  foreseeable  future.

     We continue to see some encouraging signs for gas drilling opportunities in
the U.S. Gulf of Mexico although recent declines in U.S. natural gas prices have
added  additional  uncertainty  to  the  outlook.  While  we  experienced  lower
utilization  rates  within  our Gulf of Mexico Shallow and Inland Water business
segment  for  the  full  second quarter of 2002 compared to the first quarter of
this  year,  we experienced an upward trend in activity during the month of June
and  believe  this trend is currently continuing, although further deterioration
in  natural  gas  prices  could  have  a  negative  effect.

     The  contract  drilling market historically has been highly competitive and
cyclical,  and  we  are  unable  to  predict  the extent to which current market
conditions  will  continue.  A decline in oil or natural gas prices could reduce
demand  for our contract drilling services and adversely affect both utilization
and  dayrates.

     We conduct our worldwide operations through various subsidiaries and branch
offices.  Consequently,  we  are  subject  to  changes  in  tax  laws  and  the
interpretations of those tax laws in the jurisdictions in which we operate. This
includes  tax laws directed toward companies organized in jurisdictions with low
tax  rates.  A  material  change in the tax laws of any country in which we have
operations,  including  the  United  States  ("U.S."),  could result in a higher
effective  tax  rate  on  our  worldwide  earnings.

     As  a  result  of  our  reorganization  in  May of 1999, we became a Cayman
Islands  company  in  a  transaction  commonly  referred  to  as an "inversion".
Currently  the  U.S.  House  and  Senate  are considering legislation that would
change  the  tax  law  applicable  to  companies  that  have completed inversion
transactions.  Certain  aspects  of the leading proposals, S. 2119 Reversing the
Expatriation  of  Profits Offshore Act passed by the Senate Finance Committee in
July and the American Competitiveness and Corporate Accountability Act currently
under  consideration  in  the  House  Ways and Means Committee, may make it more
difficult  to  integrate acquired U.S. businesses with existing operations or to
undertake  internal  restructuring  within  the  group.  We  can not provide any
assurance  as  to  what form final legislation will take or the impact that such
legislation  will  ultimately  have.

     Following  the  terrorist   attacks   on  September  11,  2001,   insurance
underwriters  increased  insurance  premiums  charged  for many of the coverages
historically  maintained  and  issued  general notices of cancellations to their
customers for war risk, terrorism and political risk insurance with respect to a
wide variety of insurance coverages, including but not limited to, liability and
aviation coverages. Our insurance underwriters renegotiated substantially higher
premium  rates  for war risk coverage, which can be canceled by the underwriters
on  short  notice.  Our Directors and Officers liability coverage was renewed in
the  second  quarter of 2002 with a substantial increase in premium. Our current
property  insurance  program  runs  through  the  end  of  2002  and the various
insurance  programs  providing our occupational injury and illness coverages run
through November 2002. We expect a significant increase in premiums during 2003,
but  we  are  investigating  alternatives that could mitigate the cost increase.

     On July 4, 2002, a strike was called by the Norwegian Oil and Petrochemical
Workers  Union  (NOPEF)  directed at most offshore oilfield service contractors.
Although  drilling  contractor  employees  did not strike, their operations were
affected.  The  goal  of NOPEF was to bring the wages and work conditions of the
oilfield  services  workers  up  to  the  same level as other Norwegian offshore
employees.  The  strike was concluded on August 11, 2002. While two of our rigs,
the  Polar  Pioneer  and Transocean Prospect, were affected by the strike, we do
not  currently  have  an  estimate  of  the impact on our results of operations.


                                       32
<PAGE>
     In  July  2002,  we  announced plans to pursue a divestiture of our Gulf of
Mexico  Shallow  and  Inland Water business. Under this plan, our Gulf of Mexico
Shallow  and  Inland  Water  business  would  be  separated  from Transocean and
established  as  a publicly traded company. We currently anticipate that we will
establish  R&B Falcon as the entity that owns this business. We plan to transfer
assets  not  used  in  this  business  from R&B Falcon, which will be renamed in
connection  with  the transaction, to our other subsidiaries, and these internal
transfers  will  not affect the consolidated financial statements of Transocean.
The  initial  public  offering  is  currently  being  prepared.  We  anticipate
completing  the  initial public offering when market conditions warrant, subject
to various factors. Given the current general uncertainty in the equity markets,
we are unsure when the transaction could be completed on terms acceptable to us.
We  expect to sell a portion of our interest in R&B Falcon in the initial public
offering.

     The consolidated financial statements of R&B Falcon as a separate reporting
entity  will  be  included  in  the  initial public offering prospectus and will
include various items specific to R&B Falcon that are eliminated in Transocean's
consolidated  financial  statements.  The  R&B  Falcon financial statements will
reflect  its  separate adoption of SFAS 142, including the implementation of the
initial  test for goodwill impairment utilizing the fair value of each reporting
unit  as  of  January  1,  2002  calculated  in  a  manner  consistent  with the
methodology  used  for Transocean's initial impairment test. With respect to the
Gulf  of  Mexico Shallow and Inland Water business segment, R&B Falcon will have
an  impairment  of  goodwill  consistent  with  that  reflected  in Transocean's
consolidated  financial  statements  for  the  first  quarter of 2002, since the
entire  segment is housed within R&B Falcon. Transocean's International and U.S.
Floater  Contract  Drilling  Services  segment  (the "Floater segment") operates
through a number of its subsidiaries, including R&B Falcon, which results in R&B
Falcon  having  its own separate Floater segment. Due to significant differences
in  the  composition  of  R&B  Falcon's Floater segment compared to Transocean's
Floater  segment  and  other  factors  specific  to  R&B  Falcon,  we  expect  a
substantial goodwill impairment for R&B Falcon's Floater segment even though the
same  test  did  not result in an impairment of goodwill in Transocean's Floater
segment.  A  preliminary  calculation  indicates  the impairment of R&B Falcon's
Floater  segment  will be approximately $3 billion. This impairment will have no
effect  on  Transocean's  consolidated  financial  statements.   The  impairment
relating  to  both  segments  in  R&B  Falcon  will be recorded in its financial
statements  as  a  cumulative  effect  adjustment.

     In  July  2002,  we  received  a  $4.2 million settlement of a loss of hire
insurance claim for an incident that occurred in 1998 in which the Sedco 710 was
damaged from a collision with a supply boat.  The settlement will be recorded in
operating  revenues  in  the  third  quarter  of  2002.

     We  continue with our previously announced plans to sell a number of assets
(see  "-Liquidity  and  Capital  Resources-Acquisitions  and  Dispositions"). We
received  proceeds  of $202 million in 2001 and $61 million during the first six
months  of  2002  from  the  sale  of  such  assets.

     As  of  July  30,  2002,  approximately  70  percent  and 34 percent of our
International  and  U.S.  Floater  Contract Drilling Services segment fleet days
were  committed  for  the remainder of 2002 and for the year 2003, respectively.
For our Gulf of Mexico Shallow and Inland Water segment, which has traditionally
operated  under short-term contracts, committed fleet days were approximately 11
percent  for the remainder of 2002 and none are currently committed for the year
2003.

LIQUIDITY  AND  CAPITAL  RESOURCES

     SOURCES  AND  USES  OF  CASH

<TABLE>
<CAPTION>
                                              Six Months Ended
                                                   June 30,
                                            --------------------
                                               2002       2001      Change
                                            ----------  --------  ----------
                                                     (In millions)
<S>                                         <C>         <C>       <C>
NET CASH PROVIDED BY OPERATING ACTIVITIES
  Net income (loss)                         $(1,206.4)  $  99.0   $(1,305.4)
  Depreciation and amortization                 249.9     294.7       (44.8)
  Non-cash items                              1,338.0    (100.8)    1,438.8
  Working capital                                (1.0)   (241.7)      240.7
                                            ----------  --------  ----------
                                            $   380.5   $  51.2   $   329.3
                                            ==========  ========  ==========
</TABLE>

     Cash  generated  from  net  income  items  adjusted  for  non-cash activity
increased  $88.6  million.  Cash used for working capital items decreased $240.7
million  for  the  six months ended June 30, 2002 compared to the same period in
2001  primarily  due  to  a  reduction  in  accounts  receivable  resulting from
increased  collections.

<TABLE>
<CAPTION>
                                          Six Months Ended
                                              June 30,
                                       ----------------------
                                         2002        2001       Change
                                       ---------  -----------  --------
<S>                                    <C>        <C>          <C>
                                               (In millions)
NET CASH USED IN INVESTING ACTIVITIES
  Capital expenditures                 $  (81.2)  $   (371.8)  $ 290.6
  Proceeds from disposal of assets         65.0         29.2      35.8
  Merger costs paid                           -        (24.5)     24.5
  Proceeds from sale of securities            -         16.8     (16.8)
  R&B Falcon cash at acquisition              -        264.7    (264.7)
  Other, net                                  -          2.7      (2.7)
                                       ---------  -----------  --------
                                       $  (16.2)  $    (82.9)  $  66.7
                                       =========  ===========  ========
</TABLE>

     Net  cash  used  in investing activities decreased for the six months ended
June 30, 2002 as compared to the same period in the previous year as a result of
lower capital expenditures due to the completion of our newbuild program in 2001
and  higher  proceeds  from  asset sales for the six months ended June 30, 2002,
partially  offset  by  cash  received  in  connection with the R&B Falcon merger
during  the  six  months  ended  June  30,  2001.


                                       33
<PAGE>
<TABLE>
<CAPTION>
                                                                 Six Months Ended
                                                                      June 30,
                                                               ----------------------
                                                                 2002        2001        Change
                                                               ---------  -----------  ----------
                                                                         (In millions)
<S>                                                            <C>        <C>          <C>
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES
  Net borrowings (repayments) on revolving credit agreements   $      -   $   (180.1)  $   180.1
  Net borrowings (repayments) under commercial paper program     (326.4)        60.3      (386.7)
  Repayments on other debt instruments                           (119.6)    (1,478.2)    1,358.6
  Net proceeds from issuance of debt                                  -      1,693.5    (1,693.5)
  Other, net                                                      (15.8)        10.4       (26.2)
                                                               ---------  -----------  ----------
                                                               $ (461.8)  $    105.9   $  (567.7)
                                                               =========  ===========  ==========
</TABLE>

     During  the  six months ended June 30, 2002, we had no borrowings under our
revolving  credit  agreements  and we repaid $326.4 million under our commercial
paper  program.  The  decrease  in  repayments  of  debt instruments of $1,358.6
million  was primarily due to repayments of R&B Falcon debt instruments totaling
$1,457.9 million in the second quarter of 2001 as more fully described in Note 4
to our condensed consolidated financial statements. In the six months ended June
30,  2002,  we  made early repayments of secured rig financing on the Trident IX
and  Trident  16 of $50.6 million and scheduled debt payments amounting to $68.9
million. The increase in cash used in other, net mainly reflects $8.3 million in
consent  payments  related to the exchange of our notes for R&B Falcon notes and
no  exercise of warrants in 2002. In the second quarter of 2001, we received net
proceeds  of $1,693.5 million primarily due to the issuance of the 6.625% Notes,
7.5%  Notes  and  1.5%  Convertible  Debentures.

     CAPITAL  EXPENDITURES

     Capital expenditures totaled $81.2 million during the six months ended June
30,  2002. During 2002, we expect to spend between $160 million and $200 million
on  our  existing  fleet,  corporate  infrastructure  and  major upgrades to the
Deepwater Expedition. A substantial majority of our capital expenditures relates
to  the  International  and  U.S.  Floater  Contract  Drilling Services segment.

     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  borrowings  under our revolving credit
agreements  and  commercial  paper program (see "-Sources of Liquidity") and may
engage  in  other  commercial  bank  or  capital  market  financings.

     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,  ordinary  shares or other securities or a combination
thereof.  In  addition,  from time to time, we review possible dispositions. See
"Outlook."

     In  June  2002,  we  sold  a  jackup rig, the RBF 209, and recognized a net
after-tax  loss  of  $1.5  million.

     In  March  2002,  we  sold  two semisubmersible rigs, the Transocean 96 and
Transocean  97,  for  net  proceeds of $30.7 million, resulting in net after-tax
gains  of  $1.3  million.

     During  the  six  months  ended  June  30,  2002,  we  sold  certain  other
non-strategic  assets acquired in the R&B Falcon merger and certain other assets
held  for sale for net proceeds of approximately $14.7 million, resulting in net
after-tax  gains  of  $0.7  million.


                                       34
<PAGE>
     SOURCES  OF  LIQUIDITY

     Our  primary  sources  of  liquidity in the second quarter of 2002 were our
cash  flows  from  operations and asset sales. Primary uses of cash were capital
expenditures  and debt repayments. At June 30, 2002, we had $756 million in cash
and  cash  equivalents.

     We  anticipate  that we will rely primarily upon existing cash balances and
internally  generated  cash  flows  to maintain liquidity in 2002, as cash flows
from  operations are expected to be positive and adequate to fulfill anticipated
obligations.  From  time  to  time,  we  may  also  use bank lines of credit and
commercial  paper  to  maintain  liquidity  for  short-term  cash  needs.

     We intend to use cash from operations primarily to pay debt as it comes due
and  to  fund  capital expenditures. If we seek to reduce our debt through other
than scheduled maturities, we could do so through repurchases or redemptions of,
or tender offers for, debt securities. We expect to significantly reduce capital
expenditures  compared  to  prior  years  due  to the completion of our newbuild
program  in 2001. During the first six months of 2002, we have reduced net debt,
defined  as  total  debt  less  cash  and  cash  equivalents,  by  $300 million.

     Our  internally generated cash flow is directly related to our business and
the  market segments in which we operate. Should the drilling market deteriorate
further,  or should we experience poor results in our operations, cash flow from
operations  may be reduced. However, we have continued to generate positive cash
flow  from  operations.

     We  have access to $800 million in bank lines of credit under two revolving
credit  agreements.  One revolving credit agreement provides for $250 million in
borrowings  and  will  expire  in  December  2002 and the other revolving credit
agreement  provides  for  $550 million in borrowings and will expire in December
2005.  These credit lines are used primarily to back our $800 million commercial
paper  program  and  may also be drawn on directly. As of June 30, 2002, none of
the  credit  line  capacity  was  utilized, leaving $800 million of availability
under  the  bank  lines  of  credit  for commercial paper issuance or drawdowns.

     The  bank  credit  lines  require  compliance  with  various  covenants and
provisions  customary  for  agreements  of  this  nature,  including an interest
coverage  ratio of not less than 3 to 1, a leverage ratio of not greater than 40
percent  and  limitations  on  mergers  and  sale  of  substantially all assets,
creating  liens, incurring debt, transactions with affiliates and sale/leaseback
transactions.  Should  we  fail  to  comply with these covenants, we would be in
default  and  may lose access to these facilities. A loss of the bank facilities
would  also cause us to lose access to the commercial paper markets. 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 lines and cause us to lose access to these facilities.
See Note 8 to our consolidated financial statements in our Annual Report on Form
10-K  for  the  year  ended  December  31,  2001 for a description of our credit
agreements  and  debt  securities.

     We  intend to use the proceeds from the initial public offering of our Gulf
of  Mexico  Shallow  and  Inland Water business as well as any proceeds from our
previously  announced  plans  to  sell  a  number  of assets (See "-Outlook") to
further  reduce  our  debt  balances.

     In  April  2001,  the  Securities  and Exchange Commission ("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.  In May 2001, we issued $400.0 million aggregate principal amount of
1.5%  Convertible  Debentures  due  May  15,  2021  under the shelf registration
statement.  At  July  31,  2002,  $1.6  billion  in gross proceeds of securities
remained  unissued  under  the  shelf  registration  statement.

     Our  access  to commercial paper, 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 and commercial paper, industry conditions, general economic
conditions,  market  conditions  and  market perceptions of us and our industry.


                                       35
<PAGE>
     Our contractual obligations in the table below include our debt obligations
at  face  value.

<TABLE>
<CAPTION>
                                        As of June 30, 2002
                         ------------------------------------------------
                                   Less Than    1 to 3   4 - 5    After
                          Total      1 Year     Years    Years   5 Years
                         --------  ----------  --------  ------  --------
<S>                      <C>       <C>         <C>       <C>     <C>
                                        (In millions)
CONTRACTUAL OBLIGATIONS
Debt                     $4,545.7  $    948.2  $1,197.5  $100.0  $2,300.0
                         ========  ==========  ========  ======  ========
</TABLE>

     We  are  required  to repurchase the Zero Coupon Convertible Debentures due
2020,  the  1.5% Convertible Debentures due 2021 and the 7.45% Notes due 2027 at
the  option  of  the  holder in May 2003, May 2006 and April 2007, respectively.
With  regard to both series of the Convertible Debentures, we have the option to
pay the repurchase price in cash, ordinary shares or any combination of cash and
ordinary  shares.  The  chart above assumes that the holders of these debentures
and notes exercise the options at the first available date. We are also required
to  repurchase  the  convertible debentures at the option of the holder at other
later  dates  as  more  fully  described in Note 8 to our consolidated financial
statements  in  our  Annual  Report on Form 10-K for the year ended December 31,
2001.

     We  have  certain  operating leases that have been previously discussed and
reported in our Annual Report on Form 10-K for the year ended December 31, 2001.
There  have  been  no  material  changes  in  these  previously reported leases.

     At  June  30,  2002,  we  had  other  commitments that we are contractually
obligated  to  fulfill  with  cash  should  the  obligations  be  called.  These
obligations included standby letters of credit and surety bonds, which guarantee
our  performance  as  it  relates  to our drilling contracts, insurance, tax and
other obligations in various jurisdictions. Letters of credit are issued under a
number  of  facilities  provided  by several banks. The obligations that are the
subject  of  these  surety  bonds  are geographically concentrated in Brazil and
Nigeria.  These  letters  of credit and surety bond obligations are not normally
called  as we typically comply with the underlying performance requirements. The
table  below  includes a summary of these obligations in U.S. dollar equivalents
and their time to expiration. It should be noted that these obligations could be
called  at  any  time  prior  to  the  expiration  dates.

<TABLE>
<CAPTION>
                                            As of June 30, 2002
                               ---------------------------------------------
                                       Less Than   1 to 3   4 - 5    After
                               Total     1 Year     Years   Years   5 Years
                               ------  ----------  -------  ------  --------
<S>                            <C>     <C>         <C>      <C>     <C>
                                              (In millions)
OTHER COMMERCIAL COMMITMENTS
Standby Letters of Credit      $ 63.9  $     56.2  $   7.5  $    -  $    0.2
Surety Bonds                    221.9       119.5    102.4       -         -
Purchase Option Guarantees
  Joint Ventures (a)            191.3           -    191.3       -         -
                               ------  ----------  -------  ------  --------
  Total                        $477.1  $    175.7  $ 301.2  $    -  $    0.2
                               ======  ==========  =======  ======  ========
</TABLE>

     ---------------------------
     (a)  See  "-Special  Purpose  Entities".

     In  March  2002,  we completed an exchange offer pursuant to which the 6.5%
Notes  due April 15, 2003, 6.75% Notes due April 15, 2005, 6.95% Notes due April
15,  2008,  7.375%  Notes due April 15, 2018, 9.125% Notes due December 15, 2003
and  9.5%  Notes  due December 15, 2008 of R&B Falcon whose holders accepted the
offer  were  exchanged  for  newly  issued  Transocean notes. The new notes were
issued  in  six  series  corresponding to the six series of R&B Falcon notes and
have  the same principal amount, interest rate, redemption terms and payment and
maturity  dates  as  the corresponding series of R&B Falcon notes. The aggregate
principal amount of the new notes issued was approximately $1.4 billion. Because
the  holders  of a majority in principal amount of each of these series of notes
consented  to  the  proposed  amendments to the applicable indenture pursuant to
which  the notes were issued, some covenants, restrictions and events of default
were  eliminated  from the indentures with respect to these series of notes. The
notes  not  exchanged remain an obligation of R&B Falcon. In connection with the
exchange  offers,  an  aggregate of $8.3 million in consent payments was made by
R&B  Falcon  to  holders  of R&B Falcon notes whose notes were tendered (and not
validly  withdrawn)  within the required time periods and accepted for exchange.


                                       36
<PAGE>
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.

     As  more  fully described in Note 6 to our condensed consolidated financial
statements,  we  are  a party to interest rate swap agreements with an aggregate
notional  amount of $1.6 billion. At June 30, 2002, the value of our outstanding
derivatives  was  a  net  asset  of  $63.0  million.

     Deepwater  Drilling L.L.C., an unconsolidated subsidiary in which we have a
50  percent  ownership  interest,  has  entered  into  interest  rate swaps with
aggregate market values netting to a liability of $7.9 million at June 30, 2002.
Our  interest  in  these  swaps  was included in accumulated other comprehensive
income  with  a  corresponding reduction to investments in and advances to joint
ventures.

SPECIAL  PURPOSE  ENTITIES,  SALE/LEASEBACK  TRANSACTION  AND  RELATED  PARTY
TRANSACTIONS

     We  have  transactions  with  certain  special purpose entities and related
parties  and  we  are  party to a sale/leaseback transaction. These transactions
have  all  been  previously  discussed and reported in our Annual Report on Form
10-K  for  the  year  ended  December  31,  2001.  There  have  been no material
developments  in  these  previously  reported  transactions.

NEW  ACCOUNTING  PRONOUNCEMENTS

     In  July  2001,  the  FASB  issued  SFAS 142, Goodwill and Other Intangible
Assets,  which  is effective for fiscal years beginning after December 15, 2001.
Under  SFAS  142,  goodwill  and  intangible assets with indefinite lives are no
longer  amortized  but  are  reviewed  at  least  annually  for  impairment. The
amortization  provisions  of  SFAS  142  apply to goodwill and intangible assets
acquired  after  June  30,  2001. With respect to goodwill and intangible assets
acquired  prior  to July 1, 2001, we adopted SFAS 142 effective January 1, 2002.
In  conjunction  with  the  adoption  of  this  statement,  we  discontinued the
amortization of goodwill. Application of the non-amortization provisions of SFAS
142  for  goodwill  is  expected to result in an increase in operating income of
approximately  $155  million  in  2002. See Note 2 to our condensed consolidated
financial  statements.

     In  August  2001,  the  FASB  issued SFAS 144, Accounting for Impairment or
Disposal  of  Long-Lived  Assets.  SFAS  144 supersedes SFAS 121, Accounting for
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of, and
the  accounting  and reporting provisions of Accounting Principles Board Opinion
("APB")  30,  Reporting  the  Results  of  Operations - Reporting the Effects of
Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently
Occurring  Events  and Transactions. SFAS 144 retains the fundamental provisions
of  SFAS  121 for recognition and measurement of long-lived asset impairment and
for the measurement of long-lived assets to be disposed of by sale and the basic
requirements  of  APB  30. In addition to these fundamental provisions, SFAS 144
provides guidance for determining whether long-lived assets should be tested for
impairment  and  specific  criteria  for classifying assets to be disposed of as
held  for  sale.  The  statement  is  effective for fiscal years beginning after
December  15, 2001. We adopted the statement as of January 1, 2002. The adoption
of  this statement had no material effect on our consolidated financial position
or  results  of  operations.

     In  April 2002, the FASB issued SFAS 145, Rescission of FASB Statements No.
4,  44,  and  64, Amendment of FASB Statement No. 13, and Technical Corrections.
This  statement  eliminates  the requirement under SFAS Statement 4 to aggregate
and  classify  all  gains  and  losses  from  extinguishment  of  debt  as  an
extraordinary item, net of related income tax effect. This statement also amends


                                       37
<PAGE>
SFAS  13 to require certain lease modifications with economic effects similar to
sale-leaseback  transactions  be  accounted  for  in  the  same  manner  as
sale-leaseback  transactions. In addition, SFAS 145 requires reclassification of
gains  and  losses  in  all  prior  periods  presented  in comparative financial
statements  related  to  debt  extinguishment  that do not meet the criteria for
extraordinary  item  in  APB  30.  The  statement  is effective for fiscal years
beginning  after May 15, 2002 with early adoption encouraged. We will adopt SFAS
145  effective  January  1, 2003. We do not expect adoption of this statement to
have  a  material  effect  on  our consolidated financial position or results of
operations.

     In  July  2002,  the  FASB  issued  SFAS  146,  Obligations Associated with
Disposal  Activities, which is effective for disposal activities initiated after
December  15,  2002,  with  early  application  encouraged.  SFAS  146 addresses
financial  accounting  and  reporting for costs associated with exit or disposal
activities and nullifies EITF Issue No. 94-3, "Liability Recognition for Certain
Employee  Termination  Benefits  and  Other Costs to Exit an Activity (including
Certain  Costs Incurred in a Restructuring)."  Under this statement, a liability
for  a cost associated with an exit or disposal activity would be recognized and
measured  at  its  fair  value  when  it  is incurred rather than at the date of
commitment  to  an exit plan.  Under SFAS 146, severance pay would be recognized
over  time  rather  than  up  front  provided  the  benefit arrangement requires
employees  to  render  future service beyond a "minimum retention period", which
would  be  based  on  the  legal  notification  period,  or  if there is no such
requirement,  60  days,  thereby  allowing  a  liability to be recorded over the
employees' future service period. We will adopt SFAS 146 effective with disposal
activities  initiated after December 15, 2002. We do not expect adoption of this
statement  to  have  a material effect on our consolidated financial position or
results  of  operations.

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 the Company 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 potential revenues, increased expenses,
customer  drilling programs, supply and demand, utilization rates, dayrates, the
conventional  semisubmersible  sector,  the  Norway sector, the U.K. sector, the
U.S.  Gulf  of Mexico high-specification sector, the India and Asia sectors, the
disposition  of  the  Company's Gulf of Mexico Shallow and Inland Water business
(including  the timing of the offering and portion sold), impairment of goodwill
and  related  accounting  matters  of R & B Falcon, expectations of offshore and
inland  water  drilling  market  conditions,  planned asset sales, the Company's
other expectations with regard to market outlook, expected capital expenditures,
results  and effects of legal proceedings, liabilities for tax issues, increases
in  insurance  premiums,  liquidity,  positive  cash  flow  from operations, the
exercise  of  the  option  of holders of Zero Coupon Convertible Debentures, the
1.5%  Convertible  Debentures  and  the  7.45%  Notes  to require the Company to
repurchase  the instruments, adequacy of cash flow for 2002 obligations, effects
of  accounting  changes,  the  effect of proposed legislation 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, worldwide
demand  for  oil  and  gas,  uncertainties  relating to the level of activity in
offshore  oil  and  gas  exploration  and  development,  exploration  success by
producers,  oil  and  gas prices (including U.S. natural gas prices), demand for
offshore  and  inland  water  rigs,  competition  and  market  conditions in the
contract drilling industry, our ability to successfully integrate the operations
of  acquired  businesses,  delays or terminations of drilling contracts due to a
number  of events, delays or cost overruns on construction and shipyard projects
and  possible  cancellation  of  drilling  contracts  as  a  result of delays or
performance,  our  ability  to enter into and the terms of future contracts, the
availability  of  qualified  personnel,  labor  relations  and  the  outcome  of
negotiations  with unions representing workers, operating hazards, political and
other  uncertainties  inherent  in  non-U.S.  operations (including exchange and
currency  fluctuations),  risks  of  war,  terrorism  and  cancellation  or
unavailability  of  certain  insurance  coverage,  securities market conditions,
application  of  accounting  rules,  the  impact  of  governmental  laws  and
regulations,  the  final  provisions  of any inversion and other legislation (if
any),  the  adequacy  of  sources  of  liquidity,  the  effect of litigation and
contingencies  and other factors discussed in our Annual Report on Form 10-K for
the  year  ended  December  31, 2001 and in the Company's 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


                                       38
<PAGE>
may vary materially from those indicated. 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.

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  twelve month periods ending June 30, relating to debt obligations as of
June  30,  2002.  Weighted-average  variable  rates are based on estimated LIBOR
rates  as  of  June  30,  2002,  plus  applicable  margins.

     As of June 30, 2002 (in millions, except interest rate percentages):

<TABLE>
<CAPTION>
                                             Scheduled Maturity Date (a) (b)                        Fair Value
                                ------------------------------------------------------------------  ----------
                                2003     2004     2005     2006     2007     Thereafter     Total    6/30/02
                               -------  -------  -------  -------  -------  ----------------------   ---------
<S>                            <C>      <C>      <C>      <C>      <C>      <C>           <C>        <C>
Total debt
  Fixed Rate                   $823.2   $130.2   $ 92.3   $400.0   $100.0   $   1,050.0   $2,595.7   $2,444.7
     Average interest rate        4.1%     8.5%     8.4%     1.5%     7.5%          7.6%       5.6%
  Variable Rate                $125.0   $150.0   $ 75.0        -        -             -   $  350.0   $  350.0
     Average interest rate        2.6%     2.6%     2.6%       -        -             -        2.6%
  Receive Fixed/Pay Variable
   Swaps (c)                        -        -   $350.0        -        -   $   1,250.0   $1,600.0   $1,726.9
     Average interest rate          -        -      4.7%       -        -           3.6%       3.8%
</TABLE>

--------------------------------
(a)  Maturity  dates  of  the  face  value  of the Company's debt assume the put
     options  on  the  Zero  Coupon  Convertible  Debentures,  1.5%  Convertible
     Debentures  and  7.45%  Notes  will  be exercised in May 2003, May 2006 and
     April  2007,  respectively.
(b)  Expected  maturity  amounts  are based on the face value of debt and do not
     reflect  fair  market  value  of  debt.
(c)  The 6.625%, 6.75%, 6.95% and 9.5% Notes are considered variable as a result
     of  the  interest  rate  swaps.  See  Note  6 to our condensed consolidated
     financial  statements.

     At  June  30, 2002, we had approximately $2.0 billion of variable rate debt
at  face  value  (43 percent of total debt at face value). Of that variable rate
debt,  $1.6  billion  resulted  from  interest  rate  swaps  with  the remainder
representing  term  bank  debt. Given outstanding amounts as of that date, a one
percent  rise  in  interest  rates  would result in an additional $16 million in
interest  expense  per  year.  Offsetting  this, a large part of our investments
would  earn  commensurate higher rates of return. Using June 30, 2002 investment
levels,  a  one percent increase in interest rates would result in approximately
$7  million  of  additional  interest  income  per  year. Based on June 30, 2002
balances,  our net variable debt balance at face value, defined as variable rate
debt  less  cash  and  cash equivalents, totaled $1.2 billion (32 percent of net
total  debt  at  face  value).

FOREIGN  EXCHANGE  RISK

     The  Company's exposure to foreign exchange risk has not materially changed
since  December  31,  2001.


                                       39
<PAGE>
PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

     We  were a defendant in Bryant, et al. v. R&B Falcon Drilling USA, Inc., et
al.  in  the  United  States  District Court for the Southern District of Texas,
Houston  Division. R&B Falcon Drilling USA is a wholly owned indirect subsidiary
of  R&B  Falcon.  In  this suit, the plaintiffs alleged that R&B Falcon Drilling
USA,  us  and a number of other offshore drilling contractors with operations in
the  U.S.  Gulf  of Mexico engaged in a conspiracy to depress wages and benefits
paid  to certain of their offshore employees. The plaintiffs contended that this
alleged  conduct  violated  federal  antitrust  law and constituted unfair trade
practices  and  wrongful  employment acts under state law. The plaintiffs sought
treble damages, attorneys' fees and costs on behalf of themselves and an alleged
class  of  offshore workers, along with an injunction against exchanging certain
wage  and  benefit information with other offshore drilling contractors named as
defendants.  In  May  2001,  we  reached  an  agreement  in  principle  with the
plaintiffs'  counsel  to  settle  all  claims,  pending  Court  approval  of the
settlement.  In  July  2001,  before  the  Court  had  considered  the  proposed
settlement, the case, along with a number of unrelated cases also pending in the
federal  court  in  Galveston,  was  transferred  to  a federal judge sitting in
Houston as a docket equalization measure. The judge approved the settlement, and
the  funds  were  deposited  with  the  court  in  June  2002.  The terms of the
settlement  have  been  reflected  in  our  results  of operations for the first
quarter  of  2001.  The settlement did not have a material adverse effect on our
business  or  consolidated  financial  position.

      In December 1998, Mobil North Sea Limited ("Mobil") purportedly terminated
its  contract  for  use  of the Jack Bates based on failure of two mooring lines
while  anchor  recovery  operations  at a Mobil well location had been suspended
during  heavy  weather. We did not believe that Mobil had the right to terminate
this contract. We later recontracted the Jack Bates to Mobil at a lower dayrate.
We  filed  a  request  for  arbitration  with  the London Court of International
Arbitration  seeking  damages  for  the  termination,  and  Mobil  in  turn
counterclaimed  against  us  seeking  damages  for  our  alleged breaches of the
original  contract.  The  case  was  settled  in  July  2002 and the proceedings
dismissed.  The  ultimate  outcome  of this case did not have a material adverse
effect  on  the  Company's  business  or  consolidated  financial  position.


     In  March 1997, an action was filed by Mobil Exploration and Producing U.S.
Inc.  and  affiliates,  St.  Mary  Land & Exploration Company and affiliates and
Samuel  Geary and Associates, Inc. against Cliffs Drilling, its underwriters and
insurance  broker  in  the  16th  Judicial  District  Court  of St. Mary Parish,
Louisiana.  The plaintiffs alleged damages amounting to in excess of $50 million
in connection with the drilling of a turnkey well in 1995 and 1996. The case was
tried  before  a  jury  in  January  and  February 2000, and the jury returned a
verdict  of  approximately  $30  million  in  favor of the plaintiffs for excess
drilling  costs,  loss of insurance proceeds, loss of hydrocarbons and interest.
We  have appealed such judgment. We believe that all but potentially the portion
of  the verdict representing excess drilling costs of approximately $4.7 million
is covered by relevant primary and excess liability insurance policies of Cliffs
Drilling;  however,  the  insurers and underwriters have denied coverage. Cliffs
Drilling  has  instituted  litigation against those insurers and underwriters to
enforce  its  rights  under  the  relevant  policies.  We do not expect that the
ultimate  outcome  of  this  case  will  have  a  material adverse effect on our
business  or  consolidated  financial  position.

     We  have  certain other actions or claims pending that have been previously
discussed and reported in our Quarterly Report on Form 10-Q for the three months
ended March 31, 2002, our Annual Report on Form 10-K for the year ended December
31,  2001  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.

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

     At  the  Annual  General  Meeting  of  Transocean Inc. held on May 9, 2002,
271,130,702  shares  were  represented  in person or by proxy out of 319,136,365
shares  entitled  to  vote  as  of  the  record  date,  constituting  a  quorum.


                                       40
<PAGE>
     The  matters  submitted  to a vote of shareholders were (i) the election of
Class  III  Directors  as set forth in the Company's Proxy Statement relating to
the  meeting;  (ii)  the  approval  of  appointment  of  Ernst  &  Young  LLP as
independent  auditors  for 2002 and (iii) the change of name of Transocean Sedco
Forex Inc. by special resolution to Transocean Inc. With respect to the election
of  directors,  the  following  number  of  votes  were cast as to the Class III
Director  nominees:  Ronald  L.  Kuehn, Jr., 268,457,162 votes for and 2,673,540
votes  withheld;  Paul  B.  Loyd, Jr., 264,984,050 votes for and 6,146,652 votes
withheld; Roberto Monti, 268,463,195 votes for and 2,667,507 votes withheld; and
Ian  C.  Strachan,  266,818,204  votes  for  and  4,312,498 votes withheld. With
respect  to  the  Company's  appointment  of  independent  auditors,  there were
259,303,765  votes  for  and  10,805,455  votes  withheld.  There were 1,020,884
abstentions  and no broker non-votes in the appointment of independent auditors.
With  respect  to  the Company's change of name, 269,899,612 votes were cast for
the  proposal  and  228,216  votes  were  cast  against the proposal. There were
1,002,873  abstentions  and  no  broker  non-votes  in the vote on the proposal.

ITEM  5.  OTHER  INFORMATION

     Jon C. Cole resigned from his position as Executive Vice President, Shallow
Water  and  Inland  Water  Operations  effective  July  31,  2002.

     The  Company  hired  Jan Rask effective as of July 16, 2002 to be President
and  Chief  Executive  Officer  of  the  separate company to be established as a
publicly  traded  company  consisting  of  our Gulf of Mexico Shallow and Inland
Water business.  (See "Item 2. Management's Discussion and Analysis of Financial
Condition  and  Results  of  Operations  -  Outlook")


                                       41
<PAGE>
     ITEM 6.  EXHIBITS  AND  REPORTS  ON  FORM  8-K

     (a)  Exhibits

The following exhibits are filed in connection with this Report:

NUMBER    DESCRIPTION
------    -----------

*2.1      Agreement  and Plan of Merger dated as of August 19, 2000 by and among
          Transocean  Inc.,  Transocean Holdings Inc., TSF Delaware Inc. and R&B
          Falcon  Corporation (incorporated by reference to Annex A to the Joint
          Proxy  Statement/Prospectus  dated  October  30,  2000  included  in a
          424(b)(3)  prospectus  filed  by  the  Company  on  November  1, 2000)

*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  the  Company  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  the  Company  on  November  1,  2000)

+3.3      Certificate of Incorporation on Change of Name to Transocean Inc.

+10.1     Employment  Agreement  dated  July  15,  2002  by and among R&B Falcon
          Corporation,  R&B  Falcon  Management  Services,  Inc.,  and  Jan Rask

+10.2     Separation  Agreement  dated  as  of  July  23,  2002  by  and between
          Transocean  Offshore  Deepwater  Drilling  Inc.  and  Jon  C.  Cole

--------------------
*  Incorporated  by  reference  as  indicated.
+   Filed  herewith.

     (b)     Reports  on  Form  8-K

     The  Company  filed  a  Current  Report  on  Form  8-K  on  April  8,  2002
(information furnished not filed) announcing financial information pertaining to
revenues  by  asset  type  and  geographic  location for the twelve months ended
December  31, 2001, the Company's view of supply/demand, committed fleet days as
of March 28, 2002 and proceeds from asset sales, a Current Report on Form 8-K on
April  30,  2002  (information  furnished not filed) announcing that the updated
"Monthly  Fleet Report" was available on the Company's website, a Current Report
on  Form  8-K on May 13, 2002 announcing that shareholders approved the proposal
to  change  the name of the Company to Transocean Inc., a Current Report on Form
8-K  on  May 15, 2002 (information furnished not filed) announcing the Company's
view  of  supply/demand  and  the  effect  of  a change in dayrate assumption on
earnings  per  share,  a Current Report on Form 8-K on May 31, 2002 (information
furnished  not  filed)  announcing  that  the updated "Monthly Fleet Report" was
available  on the Company's website and a Current Report on Form 8-K on June 28,
2002  (information  furnished  not  filed)  announcing that the updated "Monthly
Fleet  Report"  was  available  on  the  Company's  website.


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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 13, 2002.

TRANSOCEAN  INC.



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



By:   /s/  Ricardo  H.  Rosa
     -----------------------
           Ricardo  H.  Rosa
           Vice  President  and  Controller
           (Principal  Accounting  Officer)


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