Exhibit 10.37


                                                           Contract No. MA-13450

                      AMENDMENT NO. 1 TO SECURITY AGREEMENT

SPECIAL PROVISIONS:

     This Amendment No. 1 to Security Agreement, dated of as January 21, 2000
("Amendment No. 1 to Security Agreement"), between Perforadora Central SA. de
C.V., a Mexican corporation (the "Shipowner") and the United States of America
(the "United States"), represented by the Secretary of Transportation, acting by
and through the Maritime Administrator (the "Secretary"), pursuant to the
provisions of Title XI of the Merchant Marine Act, 1936 as amended.

WITNESSETH:

A.   The Shipowner has contracted for the construction of the TONALA, a
     LeTourneau Design Super 116C Jack-Up Mobile Drilling Unit (the "Vessel") to
     be built pursuant to the Construction Contract with TDI-Halter, Inc., a
     Texas corporation (the "Shipyard"). Subsequently, the Shipyard merged with
     TDI-Halter Limited Partnership, a Louisiana Limited Partnership (the
     "Merged Shipyard"), which assumed by operation of law the rights and
     obligations of the Shipyard under the Construction Contract, as modified,
     amended or supplemented thereafter;

B.   Effective November 4, 1999, TDI-Halter Limited Partnership changed its name
     to Friede Goldman Offshore Texas, Limited Partnership.

C.   Delivery of the Vessel will occur on the date hereof;

D.   To aid in the financing of the costs of construction of the Vessel, the
     Shipowner has entered into the Bond Purchase Agreement providing for the
     sale and delivery, on the Closing Date, of United States Government
     Guaranteed obligations in the aggregate principal amount of $70,528,000.00,
     designated "United States Government Guaranteed Export Ship Financing
     Obligations, 1998 Series" (the "Obligations") having the maturity date and
     interest rate set forth in the Bond Purchase Agreement, the Indenture and
     the Obligations (the "Guarantee Transaction");

E.   As part of the Guarantee Transaction, the Shipowner executed and delivered
     to the Secretary, its promissory Note in the amount of the Obligations (the
     "Secretary's Note");

F.   The Shipowner has, on the date hereof, the Delivery Date of the Vessel,
     provisionally registered the Vessel under the laws of Panama, and granted
     to the Secretary a mortgage with first priority (Contract No. MA-13451),
     pursuant to the laws of Panama, and enforceable under the laws of Panama
     and Mexico.

<PAGE>
G.   As further security to the Secretary and in consideration of the
     Secretary's agreeing to issue the Guarantees, the Merged Shipyard executed
     the Consent of Merged Shipyard to the assignment of the Construction
     Contract pursuant to the Security Agreement, and LeTourneau, Inc. has
     executed a Consent of and Grant of Rights by LeTourneau, Inc. pursuant to
     the assignment of the Construction Contract to the Secretary as set forth
     in Shipowner's assignment of the Security Agreement, and has also granted,
     directly to the Secretary, and to Shipowner certain rights in and to the
     License Agreement and Kit Construction Agreement.

H.   In connection with the delivery of the Vessel, the Shipowner has agreed to
     grant additional security to the Secretary.

     NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained, and of other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, and in order to provide security to
the Secretary for the Secretary's Note, the parties hereto hereby agree as
follows:

ARTICLE 1 ADDITIONS, DELETIONS AND AMENDMENTS

(1)  Concerning Table A.

     Attached hereto is Exhibit (1) to Table A setting forth the actual costs of
     the Vessel.

(2)  Concerning Schedule X.

     Schedule X to the Security Agreement is hereby amended by:

     (a)  adding the following definitions:

          "Amendment No. 1 to Security Agreement" shall mean this Amendment
          No. 1 to the Security Agreement dated January 21, 2000, between the
          Shipowner and the Secretary.

          "TONALA" means the jack-up drilling unit described in Recital A of
          Amendment 1 to Security Agreement.

          "Final Closing Date" or "Final Closing" means the date the Shipowner
          and Secretary executed the Mortgage.

(3)  Concerning the Security Agreement Special Provisions and Exhibit 1 to the
     Security Agreement

     (a)  Sections 3(i) and (j) are deleted in their entirety from the Security
          Agreement Special Provisions.


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<PAGE>
     (b)  On the Delivery Date, and on each anniversary thereof, the Shipowner
          shall deposit into the Escrow Fund an amount equal to .033 of the
          outstanding principal amount of the Secretary's Note (the "Deposit");
          provided, however, that in the event the Vessel is subject to that
          certain Bareboat Charter Agreement between the Shipowner and Chiles'
          Offshore, LLC (the "Charterer"), dated November 30, 1999 (the
          "Charter"), no Deposit shall be required; and provided further that in
          the event the Charter is terminated within the first 365 consecutive
          days of the Delivery Date, the Shipowner shall on the date the Charter
          is terminated make the Deposit that was initially due on the Delivery
          Date and shall make the subsequent Deposits on each anniversary of the
          Delivery Date. If the Charter is or is to be terminated after 365
          consecutive days of the Delivery Date, the Shipowner shall make the
          Deposit due for the immediately preceding anniversary of the Delivery
          Date.

     (c)  These deposits are in lieu of the Shipowner's providing the Secretary
          with satisfactory mortgagee rights political risk insurance, and are
          required only when the Vessel is in Mexico or in Mexican waters for a
          full year as defined in (d) below; provided however, that the
          Shipowner shall provide the Secretary with written notice 30 days
          prior to moving the Vessel to any country other than Mexico (or back
          to Mexico from any such other country), and the Secretary, in his sole
          discretion, may

               (i) require either that the Shipowner obtain political risk
               insurance coverage, in form and substance satisfactory to the
               Secretary, on the Vessel prior to the intended move, or

               (ii) (if a deposit has not made been made for the applicable full
               year) deposit funds in an amount equal to .003 of the outstanding
               principal amount of the Secretary's Note.

     (d)  Notwithstanding Section (3)(b) above, in the event the Vessel is in
          United States waters for a full year, no such deposit shall be
          required for that year. A full year shall be defined as the 365
          consecutive days from the Delivery Date and every anniversary
          thereafter.

     (e)  The Shipowner shall provide the Secretary with Contingent Operators
          Extra Expense insurance, including coverage for control of well,
          redrilling, and pollution and contamination, in an amount no less than
          $50 million, and such insurance shall be in form and substance
          satisfactory to the Secretary.

     (f)  The Shipowner shall also provide the Secretary with personal injury
          insurance which shall be in form and substance satisfactory to the
          Secretary; provided however, the Shipowner may forego such insurance
          for the Vessel's crew if and only if the Vessel is being operated in


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<PAGE>
          Mexican waters and her crew is covered for personal injury by the
          Mexican equivalent of U.S. Social Security as it exists on the
          Delivery Date (the "Mexican Coverage"). The Shipowner shall notify the
          Secretary in writing of any change in such Mexican laws, and shall
          provide the Secretary with a legal opinion, in form and substance
          satisfactory to the Secretary, from independent counsel satisfactory
          to the Secretary regarding the effects of any such changes.

     (g)  The Shipowner shall exercise its option to terminate the Charter under
          the terms of Section 7(h) thereof only with the Secretary's prior
          written consent.

ARTICLE 2 MISCELLANEOUS PROVISIONS.

(1)  The Shipowner and the Secretary hereby reaffirm the terms and provisions of
     the Security Agreement, as amended hereby, and declare and agree that the
     Security Agreement, as amended hereby, is in full force and effect.

(2)  Terms used but not defined herein, but which are defined in Schedule X of
     the Security Agreement are used herein as so defined unless and to the
     extent otherwise provided in this Amendment No. 1 to Security Agreement.

(3)  This Amendment No. 1 to Security Agreement may be executed in any number of
     counterparts. All such counterparts shall be deemed to be originals and
     shall together constitute but one and the same instrument.

(4)  Notwithstanding any provision herein, in the event there are any
     inconsistencies between the original of this document held by the Secretary
     and the original of this document held by any other party hereto, the
     provisions of the original of this document held by the Secretary shall
     prevail.










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<PAGE>
         IN WITNESS WHEREOF, the parties have caused this Amendment No. 1 to
Security Agreement to be executed and delivered as of the day and year first
above written.

                                          PERFORADORA CENTRAL S.A. DE C.V.


                                          By: /s/ PATRICIO ALVAREZ MORPHY
                                             -----------------------------------
                                              Patricio Alvarez Morphy, President

PERFORADORA CENTRAL, S.A. DE CV.
HAS NO SEAL

WITNESS BY:


/s/ JORGE VILLALPANDO BORREGO
---------------------------------------
Jorge Villalpando Borrego
Vice President and Assistant Secretary

                                          UNITED STATES OF AMERICA
                                          SECRETARY OF TRANSPORTATION


                                          BY:  /s/ JOEL C. RICHARD
                                             -----------------------------------
                                             Secretary, Maritime Administration


[SEAL]

ATTEST


By: /s/ PATRICIA E. BYRNE
   ------------------------------------
   Assistant Secretary, Maritime
           Administration








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<PAGE>
                                     TABLE A

                                 SUBTABLE (A)(1)


<Table>
<Caption>
                                                        AMOUNT
                                                       OBLIGATED
TONALA                           AMOUNT PAID           TO BE PAID           TOTAL

<S>                            <C>                         <C>          <C>
Contract Price                 $62,500,000.00              0            $62,500,000.00

ABS Inspection Fees                  1,000.00              0                  1,000.00

Changes and Extras               5,000,000.00              0              5,000,000.00

Performance Bond                      N/A                  0                   N/A

Net Int. During Const.           6,105,697.00              0              6,105,697.00

Commitment Fee                     230,000.00              0                230,000.00

Guarantee Fee                    2,330,606.00              0              2,330,606.00

Total Actual Costs             $76,167,303.00              0            $76,167,303.00

Escrow Fund Deposit                         0              0                         0
</Table>







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