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                                                                    EXHIBIT 10.2

                              MASTER RIG LEASE AND
                          MANAGEMENT SERVICES AGREEMENT

         This MASTER RIG LEASE AND MANAGEMENT SERVICES AGREEMENT (the "Lease")
is made on this ____ day of April, 1999 by and between Bayard Drilling, L.P., a
Delaware limited partnership ("Lessor") and Nabors Drilling USA, Inc., a
Delaware corporation ("Lessee").

         In consideration of the mutual covenants and agreements hereinafter set
forth, the parties hereto agree as follows:

1.       Lease of Equipment and Management Services. Subject to, and upon all of
         the terms and conditions of this Lease, Lessor hereby leases to the
         Lessee, and Lessee hereby leases from Lessor, those certain oil
         drilling rigs ("Drilling Rigs") and all pipe, collars, equipment,
         inventories and supplies associated with the Drilling Rigs set forth in
         Attachment A (the "Property"). Lessee agrees to provide such management
         and administrative services as may be requested by Lessor, including
         but not limited to, day-to-day operations, district office and regional
         office; accounting, tax, legal, insurance and other stewardship
         services as required.

2.       Lease Term.

         a.       The initial term (the "Initial Term") of this Lease shall
                  commence on the date hereof and terminate on December 31,
                  1999. Lessee shall have the right and option to renew this
                  Lease for up to three successive one-year periods (the "Option
                  Term") following the expiration of the Initial Term. Lessee
                  shall be deemed to have exercised such renewal rights unless
                  and until it has given notice to Lessor that it desires to
                  terminate this Lease. This required notice must be given in
                  writing in accordance with Article 19 and must be received by
                  Lessor not less than thirty days prior to the expiration of
                  the Initial Term or such one-year period as applicable. If
                  Lessee has not given a proper notice of termination in
                  accordance herewith, the term of this Lease shall be extended
                  automatically for an additional one-year period and shall
                  remain in effect until the Lease is terminated by either party
                  by notice to the other party not less than 30 days prior to
                  the expiration of any such successive one-year period during
                  the Option Term. Any such termination shall be effective only
                  on the last day of the Initial Term or the last day of any
                  such successive one-year period during the Option Term, as the
                  case may be. The terms and conditions contained in this
                  Agreement shall govern during the Option Period. Lessee shall
                  have the right to terminate this Lease upon giving Lessor 30
                  days' prior written notice.

         b.       As used herein, the term "Lease Term" means, subject to
                  termination as provided above and in Section 11, the Initial
                  Term and all such successive one-year periods during the
                  Option Term for which this Lease is extended.

3.       Rent.

         a.       The Lessee shall pay to the Lessor for use of the Property
                  during the Lease Term rent to be determined on the following
                  basis ("Rent"). The Rent for each Drilling Rig shall be 5% of
                  the Equivalent Operating Dayrate (as defined below) for such
                  Drilling Rig. For daywork contracts entered into by Lessee,
                  the Rent shall be payable for each day that Lessee receives
                  Operating Dayrate for the Drilling Rig. For footage and
                  turnkey contracts, the Rent is payable for each day the
                  Drilling Rig operates from spud of well through the rig
                  release.

                  For daywork contracts the Equivalent Operating Dayrate is
                  defined as:


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         (Contract Operating Dayrate x Actual Operating Days) - (Mobilization
         and Demobilization losses) Actual Operating Days

                  For footage and turnkey contracts the Equivalent Operating
                  Dayrate is defined as the Operating Dayrate for daywork
                  operations as specified in the contract even if such dayrate
                  is not used for billing purposes.

                  The parties acknowledge and agree that the Rent represents a
                  reasonable rate or rent for the Drilling Rigs after deducting
                  a reasonable charge for the management services provided by
                  Lessee hereunder.

         b.       Lessee shall be responsible for and shall defend and indemnify
                  and hold Lessor harmless from the payment of any taxes,
                  duties, import and export charges and other charges or fees
                  (and any related fines, penalties or interest) of any type or
                  description imposed directly or indirectly on Lessee or Lessor
                  by any federal, state, local, or foreign government or taxing
                  authority as a result of this Lease, the property, or the
                  operation or use of the property.

         c.       Interest on any past due payments under this Lease shall
                  accrue at the rate of 1 1/2% per month, or if such rate shall
                  exceed the maximum rate allowed by law, then at such maximum
                  rate, and shall be payable on demand. Charges for taxes,
                  levies, imposts, duties, fees, assessments or other charges,
                  penalties and interest shall be paid promptly by Lessee when
                  invoiced by Lessor.

4.       Delivery of the Property. The Property shall be leased to Lessee, and
         Lessee accepts the Property where-is, as-is.

5.       Ownership and Use.

         a.       The Property shall at all times be the sole and exclusive
                  property of the Lessor. The Lessee shall have no rights or
                  property interest in the Property, except for the right to use
                  the Property in normal operations during the Lease Term.
                  Lessee shall not use the Property for any purpose for which it
                  was not designed or intended by the manufacturer thereof.

         b.       After prior notice to Lessor, Lessee may, at its own expense,
                  make alterations in or add attachments to the Property,
                  provided such alterations or attachments are readily removable
                  and do not reduce the value of the Property or interfere with
                  the normal and satisfactory operation or maintenance of the
                  Property. All such alterations and attachments shall be and
                  become the property of Lessor at the expiration or termination
                  of this Lease, or at the option of Lessee, shall be removed
                  and retained by Lessee provided the Property is restored, at
                  Lessee's expense, to its original condition, reasonable wear
                  and tear only excepted.

         c.       So long as Lessee is not in default hereunder, Lessor shall
                  not interfere with Lessee's use or possession of the Property
                  during the Lease Term.

         d.       The Lessee shall keep the Property free and clear from all
                  claims, levies, liens, encumbrances and process whatsoever
                  other than those arising by, through or under Lessor. The
                  Lessee shall give the Lessor immediate notice of any such
                  attachment or other judicial process affecting all or any part
                  of the Property and take all such action as may be necessary
                  to promptly remove the same.


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         e.       The Lessee shall not sublet or part with possession of the
                  Property or any part thereof or attempt in any other manner to
                  dispose of the Property or transfer or assign its rights under
                  this Lease without the prior consent of Lessor. No such
                  purported assignment, sublease or other parting with
                  possession of the Property shall relieve Lessee of its
                  liabilities and obligations under this Lease.

         f.       The Lessee shall use, maintain and operate the Property so as
                  to comply with all laws, rules and regulations (domestic or
                  foreign) applicable thereto and shall obtain all governmental
                  permits, licenses and approvals required in connection
                  therewith. In case any additional or other equipment,
                  appliance or alteration is required to be made or installed on
                  any item of Property in order to comply with such laws,
                  regulations, requirements and rules, Lessee agrees to make or
                  install such equipment, appliance or alteration at its own
                  cost and expense. To the extent that Lessee agrees to comply
                  with foreign laws, rules and regulations, nothing shall be
                  understood as an agreement by Lessee to take any action or
                  refrain from taking any action that would violate any law of
                  the United States of America or that would subject Lessee to
                  penalties under the law of the United States of America.

         g.       Lessor acknowledges and recognizes that Lessee owns and
                  operates its own drilling rigs ("Lessee's Rigs") in addition
                  to the Drilling Rigs. Lessee shall have no obligation to use
                  the Drilling Rigs in its drilling operations in preference to
                  Lessee's Rigs and shall have no obligation to obtain premium
                  rates for the Drilling Rigs or to use the Drilling Rigs in
                  preference to Lessee's Rigs for operations paying premium
                  rates. At all times during the Lease Term, Lessee shall, in
                  its sole discretion, have the right to determine whether to
                  use Drilling Rigs or Lessee's Rigs in any of its drilling
                  operations with no obligation to account to Lessor in any way.

6.       DISCLAIMER OF WARRANTY. LESSOR MAKES NO WARRANTY OF ANY KIND WHATSOEVER
         WITH RESPECT TO THE PROPERTY, AND ALL WARRANTIES OF QUALITY, DESIGN,
         MANUFACTURE, MAINTENANCE, FITNESS FOR A PARTICULAR PURPOSE AND
         MERCHANTABILITY ARE HEREBY DISCLAIMED AND EXCLUDED AND THE PROPERTY IS
         PROVIDED HEREUNDER ON AN AS IS, WHERE IS BASIS.

7.       Repair and Replacements. The Lessee shall maintain the Property in good
         working order and shall thereafter keep and maintain the Property in
         good condition and working order and, at its own cost and expense, make
         all repairs, adjustments and replacements necessary for its
         preservation, normal wear and tear excepted. All such replacements
         shall immediately become the property of the Lessor. Lessee shall have
         the right to paint the Drilling Rigs to conform to its color scheme for
         rigs, but shall have the obligation to repaint the Drilling Rigs to
         conform to Lessor's color scheme upon termination of the Lease Term.

8.       Loss of Equipment and Insurance. Lessee shall immediately notify Lessor
         of all details concerning any damage to, or loss of, the Property
         arising out of any event or occurrence whatsoever, including but not
         limited to, the alleged or apparent improper manufacture, functioning
         or operation of the Property.

         a.       Until the Property is returned to Lessor, the entire risk of
                  loss, destruction or damage to the Property from any cause or
                  condition whatsoever shall be borne solely and exclusively by
                  the Lessee, and the Lease Term shall not terminate as a result
                  of such loss, destruction or damage except as provided below.
                  In the event a portion of the Property is lost, destroyed or
                  damaged beyond repair, or all or any portion of the Property
                  is damaged but not beyond repair, Lessee shall promptly repair
                  or replace such Property with similar oil drilling equipment
                  having a value and utility not less than those of the Property
                  or such portion thereof which is so lost, destroyed or
                  damaged. In the event all, 



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                  but not part, of the Property is lost, destroyed or damaged
                  beyond repair, Lessee may either replace the Property as
                  provided above or terminate the Lease Term upon payment to the
                  Lessor of an amount equal to the all risk property damage
                  insurance required to be carried as provided in Section 8(b)
                  hereof. Payment of such amount to Lessor by the insurance
                  carrier issuing such policy or policies shall constitute
                  payment hereunder by Lessee. All such replacement property
                  shall immediately be conveyed to, and become the property of,
                  Lessor, free and clear of all liens, claims and encumbrances
                  whatsoever.

         b.       Until the Property is returned to Lessor, the Lessee, at its
                  own cost and expense, shall keep in effect with reputable
                  insurers acceptable to the Lessor all risk and public
                  liability insurance policies covering the Property and Lessor.
                  Such all risk coverage shall insure the Property in an amount
                  not less than that maintained by Lessor on the date hereof
                  against all risks of loss or damage from every cause
                  whatsoever. Such public liability insurance shall be in such
                  amount as is reasonably acceptable to Lessor. Evidence of such
                  insurance coverage shall be furnished to Lessor on the date
                  hereof and, from time to time, thereafter as Lessor may
                  demand. Such policies shall provide that no less than thirty
                  days' written notice shall be given Lessor prior to
                  cancellation of such policies for any reason. Lessee hereby
                  irrevocably appoints Lessor as Lessee's attorney-in-fact
                  coupled with an interest to make claim for, receive payment
                  of, and execute any and all documents that may be required to
                  be provided to the insurance carrier in substantiation of any
                  such claim for loss or damage under such all risk insurance
                  policy, and to endorse Lessee's name to any and all drafts or
                  checks in payment of the loss proceeds. All insurance policies
                  shall name both the Lessee and the Lessor as insured
                  thereunder. Each damage policy shall provide for payment of
                  all losses directly to the Lessor. Lessor shall remit such
                  amounts to Lessee upon repair or replacement of the Property
                  or portion thereof in respect of which such losses are paid as
                  provided in Section 8(a) hereof. Each liability policy shall
                  provide that all losses be paid on behalf of the Lessee and
                  the Lessor as their respective interests appear.

9.       Location and Inspection. Lessee shall keep the Property in its sole
         possession and control at all times. Lessor shall have the right to
         inspect the Property at any time and from time to time upon reasonable
         notice to the Lessee.

10.      Return of the Property. Upon the expiration or termination of this
         Lease, Lessee shall return the Property to Lessor at its current
         location or at such other location as the parties may reasonably agree
         upon. The Property shall be returned to Lessor in the same condition as
         originally received by Lessee, normal wear and tear excepted.

11.      Termination of the Lease. This Lease may be terminated only as follows:

         a.       By agreement of the parties.

         b.       Automatically, as to a Drilling Rig, in the event of the total
                  destruction of that Drilling Rig.

         c.       By Lessor in the event of a default as defined in Article 12
                  below.

         d.       Automatically at the end of the Lease Term.

         e.       By Lessee by proper notice served in accordance with the
                  provisions of Article 2(a).

12.      Events of Default and Remedies. The occurrence of any one of the
         following shall constitute as Event of Default hereunder:



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         a.       Lessee fails to pay any installment of Rent on or before the
                  fifth day following the date when the same becomes due and
                  payable;

         b.       Lessee attempts to remove, sell, transfer, encumber, sublet or
                  part with possession of the Property or any items thereof,
                  except as expressly permitted herein;

         c.       Lessee shall fail to observe or perform any of the other
                  obligations required to be observed or performed by Lessee
                  hereunder and such failure shall continue uncured for twenty
                  (20) days after notice thereof to Lessee by Lessor;

         d.       Any representation or warranty made by Lessee herein or in any
                  document or certificate furnished in connection herewith shall
                  prove incorrect in any material respect;

         e.       Lessee ceases doing business as a going concern, makes an
                  assignment for the benefit of creditors, admits in writing its
                  inability to pay its debts as they become due, files a
                  voluntary petition in bankruptcy, is adjudicated a bankrupt or
                  an insolvent, files a petition seeking for itself any
                  reorganization, arrangement, composition, readjustment,
                  liquidation, dissolution or similar arrangement under any
                  present or future statute, law or regulation or files an
                  answer admitting the material allegation of a petition filed
                  against it in any such proceeding, consents to or acquiesces
                  in the appointment of a trustee, receiver, or liquidator of it
                  or of all or any substantial part of its assets or properties,
                  or if it or its shareholders shall take any action looking to
                  its dissolution or liquidation; or

         f.       Within 30 days after the commencement of any proceedings
                  against Lessee seeking reorganization, arrangement,
                  readjustment, liquidation, dissolution or similar relief under
                  any present or future statute, law or regulation, such
                  proceedings shall not have been dismissed, or if within 30
                  days after the appointment, without Lessee's consent or
                  acquiescence, of any trustee, receiver or liquidator of it or
                  of all or any substantial part of its assets and properties,
                  such appointment shall not be vacated.

         Upon the occurrence of an Event of Default, Lessor may, at its option,
         do any or all of the following: (i) by notice to Lessee terminate the
         Lease as to any or all Property; (ii) whether or not the Lease is
         terminated as to any or all Property, take possession of any or all of
         the Property, wherever situated, and for such purpose, enter upon any
         premises without liability for so doing or Lessor may cause Lessee, and
         Lessee hereby agrees, to return the Property to Lessor as provided in
         this Lease; (iii) recover from Lessee, as liquidated damages, and not
         as s penalty, an amount equal to the present value of all monies to be
         paid by Lessee during the remainder of the Lease Term, discounted at
         the rate of 10% per annum, which payment shall become immediately due
         and payable; and (iv) sell, dispose of, hold, use or lease any Property
         as Lessee in its sole discretion may determine without, except as
         provided below, any duty to account to Lessee (and Lessor shall not be
         obligated to give preference to the sale, lease or other disposition of
         the Property over the sale, lease or other disposition of similar
         property owned or leased by Lessor). In any event, Lessee, without
         further demand, shall pay to Lessor an amount equal to all sums due and
         payable for all periods up to and including the date on which Lessor
         has declared this Lease to be in default.

         In the event that Lessee shall have paid to Lessor the liquidated
         damages referred to in clause (iii) above, Lessor hereby agrees to pay
         to Lessee, promptly after receipt thereof, all rentals or proceeds
         received from the reletting or sale of the Property during the balance
         of the initial one-year term or the applicable successive one-year
         period of the Lease Term (after deduction of all expenses incurred by
         Lessor), said amount never to exceed the amount of the liquidated
         damages paid by Lessee. Lessee agrees that Lessor shall have no
         obligation to sell or lease the Property and shall not be required to
         give preference to the sale, lease or to other disposition of the
         Property over the sale, lease or other disposition of similar property
         owned or leased by 



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         Lessor. Lessee shall in any event remain fully liable for reasonable
         damages as provided by law and for all costs and expenses incurred by
         Lessor on account of such default including, but not limited to, all
         court costs and reasonable attorneys' fees. The rights afforded Lessor
         hereunder shall not be deemed to be exclusive, but shall be in addition
         to any rights or remedies provided by law.

13.      Net Lease. Except as otherwise specifically provided in this Lease or
         an Exhibit hereto, it is understood and agreed that this is a net
         lease, and that, as between Lessor and Lessee, Lessee shall be
         responsible for all costs and expenses of every nature whatsoever
         arising out of or in connection with or related to this Lease of the
         Property (including, but not limited to, transportation, transportation
         insurance, rigging, drayage, packing, installation and mobilization and
         demobilization charges). Lessee hereby agrees that, in the event that
         Lessee fails to pay or perform any obligation under this Lease, Lessor
         may, at its option, pay or perform said obligation and any payment made
         or expense incurred by Lessor in connection therewith shall become
         additional rent which shall be due and payable by Lessee upon demand.

14.      Indemnification. Lessee hereby agrees to assume liability for, and does
         hereby agree to indemnify, defend, protect, save and keep harmless
         Lessor and its respective successors, assigns, legal representatives,
         agents, officers, directors and employees, from and against, any and
         all liabilities, obligations, losses, damages, penalties, claims,
         actions, suits, costs, expenses or disbursements (including legal fees
         and expenses) of any kind and nature whatsoever which may be imposed
         on, incurred by or asserted against Lessor or any of its respective
         successors, assigns, legal representatives, agents officers, directors
         and employees (whether or not also indemnified against by the
         manufacturer(s) or any other person), in any way relating to or arising
         out of this Lease or any document contemplated hereof, or the
         performance or enforcement of any of the terms hereof, or in any way
         relating to or arising out of the lease, ownership, possession, use,
         condition, operation, sale or other disposition of the Property by
         Lessee or any accident in connection therewith (including, without
         limitation, latent and other defects, whether or not discoverable);
         provided, however, that Lessee shall not be required to indemnify
         Lessor or its respective successors, assigns, legal representatives,
         agents, and servants, for loss or liability in respect of any item or
         Property arising from acts or events which occur after possession of
         such item of Property has been returned to Lessor or loss or liability
         resulting from the willful misconduct of Lessor. Lessee agrees that
         Lessor shall not be liable to Lessee for any liability, claim, loss,
         damage or expense of any kind or nature arising in strict liability or
         caused directly or indirectly by the inadequacy of the Property for any
         purpose or any deficiency or defect therein or the use or maintenance
         thereof or any repairs, servicing or adjustments thereto or any delay
         in providing or failure to provide any thereof or any interruption or
         loss of service or use thereof or any loss of business or any other
         consequential damages.

15.      Severability. Any provisions of this Agreement found to prohibited by
         law shall be ineffective to the extent of such prohibition without
         invalidating the rest of this Agreement so long as the economic or
         legal substance of the transactions contemplated hereby is not affected
         in any manner materially adverse to any party hereto.

16.      Governing Law. This Agreement shall be governed by and construed and
         interpreted in accordance with the laws of Texas applicable to
         contracts made and to be performed wholly within the State of Texas.

17.      Entire Agreement. This Agreement contains the entire understanding of
         the parties, and such understanding may not be modified or terminated
         except in writing signed by the Parties and by any proper sublessee or
         assignee.

18.      Counterparts. This Agreement may be executed in two or more
         counterparts, each of which shall be deemed an original but all of
         which together shall constitute one and the same instrument.


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19.      Notices. All notices or other communications hereunder shall be in
         writing and shall be delivered personally, by telecopy or overnight
         delivery service or mailed, by registered or certified mail, postage
         prepaid, to the party for which it is intended at its address set forth
         below or to such other address as such party shall furnish to the other
         party by notice hereunder.

                  If to Lessee:

                           Nabors Drilling USA, Inc.
                           515 W. Greens Rd., Suite 1000
                           Houston, Texas 77067
                           Attention: President
                           Telecopy No.: 281.775.8147

                  If to Lessor:

Bayard Drilling, L.P.
                           515 W. Greens Rd., Suite 1200
                           Houston, Texas 77067
                           Attention: President
                           Telecopy No.: 281.775.8431

20.      No Waiver. No waiver of any of the terms and conditions hereof shall be
         effective unless in writing and signed by the party against whom such
         waiver is sought to be enforced. Any waiver of the terms hereof shall
         be effective only in the specific instance and for the specific purpose
         given. The waiver by Lessor or Lessee of any breach of any obligation
         of Lessee or Lessor shall not be deemed a waiver of such obligation or
         of any subsequent breach of the same or any other obligation. The
         subsequent acceptance of rental payments hereunder by Lessor shall not
         be deemed a waiver of any prior existing breach by Lessee regardless of
         Lessor's knowledge of such prior existing breach at the time of
         acceptance of such rental payments. The rights afforded Lessor and
         Lessee under this Section 20 shall not be deemed to be exclusive, but
         shall be in addition to any rights or remedies provided by law.

21.      Binding Effect. The provision of this Agreement shall be binding upon
         and inure to the benefit of both parties and their respective legal
         representatives, successors, and permitted assigns.

22.      Amendment. This Lease may be modified only by mutual agreement of the
         parties in writing.

23.      Arbitration. Any dispute, controversy or claim arising out of or
         relating to this Lease or the breach, termination or invalidity thereof
         shall be settled by arbitration in accordance with the rules of the
         American Arbitration Association. The number of arbitrators shall be
         three and the place of arbitration shall be at Houston, Texas.

24.      Third Party Beneficiary. Nothing in this Lease is attended to or shall
         be construed as to create any third party beneficiary to this Lease or
         otherwise confer any right in or upon any persons except the parties
         hereto and the respective permitted assigns.


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         IN WITNESS WHEREOF, the Lessor and Lessee each have caused this Lease
to be duly executed by their duly authorized officers, effective as of the day
and year first above written.

                                            NABORS DRILLING USA, INC.



                                            -------------------------------
                                            By:     Larry P. Heidt
                                            Title:  President

                                            BAYARD DRILLING, L.P.
                                            By:  BAYARD DRILLING, L.L.C.



                                            -------------------------------
                                            By:     Daniel McLachlin
                                            Title:  Manager




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