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                            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, 1999
                                  or
 ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
     OF THE SECURITIES EXCHANGE ACT OF 1934



                    Commission file number 1-13729

                        R&B FALCON CORPORATION

        (Exact name of registrant as specified in its charter)

              Delaware                        76-0544217
     (State or other jurisdiction of     (I.R.S. Employer
    incorporation  or  organization)     Identification No.)

               901 Threadneedle, Houston, Texas  77079
          (Address of principal executive offices)(Zip Code)


                            (281) 496-5000
        (Registrant's telephone number, including area code)



Indicate  by  check  mark whether the registrant  (1)  has  filed  all
reports  required to be filed by Section 13 or 15(d) of the Securities
Exchange  Act  of  1934 during the preceding 12 months  (or  for  such
shorter period that the registrant was required to file such reports),
and  (2) has been subject to such filing requirements for the past  90
days.  Yes_X_            No___


      NUMBER OF SHARES OUTSTANDING OF REGISTRANT'S COMMON STOCK
                    AT JULY 30, 1999: 193,637,361


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            Forward-Looking Statements and Assumptions

     This  Quarterly Report on Form 10-Q may contain or incorporate
by  reference certain forward-looking statements, including by  way
of  illustration  and  not of limitation,  statements  relating  to
liquidity,  revenues,  expenses, margins  and  contract  rates  and
terms.   The Company strongly encourages readers to note that  some
or   all  of  the  assumptions,  upon  which  such  forward-looking
statements  are based, are beyond the Company's ability to  control
or  estimate precisely, and may in some cases be subject  to  rapid
and material changes.  Such assumptions include the contract status
of   the   Company's  offshore  units,  general  market  conditions
prevailing  in the marine drilling industry (including daily  rates
and  utilization)  and  various other trends affecting  the  marine
drilling  industry,  including  world  oil  and  gas  prices,   the
exploration  and  development programs of the Company's  customers,
the  actions  of the Company's competitors and economic  conditions
generally.


                    PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

Company or Group of Companies for Which Report is Filed:

               R&B Falcon Corporation and Subsidiaries

      The  financial statements for the three and six month periods
ended  June  30,  1999 and 1998, include, in  the  opinion  of  the
Company,  all  adjustments (which only consist of normal  recurring
adjustments) necessary to present fairly the financial position and
results of operations for such periods.  The financial data for the
three  and  six  month periods ended June 30, 1999 included  herein
have been reviewed in accordance with standards established by  the
American  Institute  of  Certified  Public  Accountants  by  Arthur
Andersen  LLP,  the  registrant's independent  public  accountants,
whose  report  is included herein.  Results of operations  for  the
three and six month periods ended June 30, 1999 are not necessarily
indicative of results of operations which will be realized for  the
year ending December 31, 1999.  The financial statements should  be
read in conjunction with the Company's Form 10-K for the year ended
December 31, 1998.

                      R&B FALCON CORPORATION
                         AND SUBSIDIARIES

                    CONSOLIDATED BALANCE SHEET
                           (in millions)
                                            JUNE 30,   DECEMBER 31,
                                              1999         1998
                                           ---------   -----------
                                          (unaudited)
ASSETS
CURRENT ASSETS:
 Cash and cash equivalents                  $   505.6   $   177.4
 Short-term investments                         175.7          -
 Accounts receivable:
   Trade, net                                   143.3       197.0
   Other                                         62.5        62.1
 Materials and supplies inventory                43.8        36.1
 Drilling contracts in progress                  26.7        29.5
 Other current assets                            14.9        25.0
                                            ---------   ---------
   Total current assets                         972.5       527.1
                                            ---------   ---------
INVESTMENTS IN AND ADVANCES TO
 UNCONSOLIDATED INVESTEES                       191.2        28.2
                                            ---------   ---------
PROPERTY AND EQUIPMENT:
 Drilling                                     3,769.2     3,369.2
 Other                                          220.9       180.8
                                            ---------   ---------
   Total property and equipment               3,990.1     3,550.0
 Accumulated depreciation                      (592.8)     (519.4)
                                            ---------   ---------
   Net property and equipment                 3,397.3     3,030.6
                                            ---------   ---------
GOODWILL, NET OF ACCUMULATED AMORTIZATION        71.4        70.6
                                            ---------   ---------
DEFERRED CHARGES AND OTHER ASSETS                70.3        45.8
                                            ---------   ---------
NET ASSETS OF BUSINESS HELD FOR SALE              4.6         7.0
                                            ---------   ---------
TOTAL ASSETS                                $ 4,707.3   $ 3,709.3
                                            =========   =========

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
 Short-term obligations                     $      -    $   123.4
 Long-term obligations due within one year        5.3         6.3
 Accounts payable - trade                        98.8        83.1
 Accrued liabilities                            170.6       139.0
                                            ---------   ---------
   Total current liabilities                    274.7       351.8

LONG-TERM OBLIGATIONS                         2,710.0     1,866.2

OTHER NONCURRENT LIABILITIES                     35.6        35.9

DEFERRED INCOME TAXES                           120.0       142.4
                                            ---------   ---------
   Total liabilities                          3,140.3     2,396.3
                                            ---------   ---------
COMMITMENTS AND CONTINGENCIES

MINORITY INTEREST                                40.6        62.8
                                            ---------   ---------
REDEEMABLE PREFERRED STOCK                      243.8          -
                                            ---------   ---------
STOCKHOLDERS' EQUITY:
   Common stock, $.01 par value                   1.9         1.9
   Capital in excess of par value             1,112.6     1,061.5
   Retained earnings                            177.4       199.1
   Other                                         (9.3)      (12.3)
                                            ---------   ---------
      Total stockholders' equity              1,282.6     1,250.2
                                            ---------   ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY  $ 4,707.3   $ 3,709.3
                                            =========   =========

The accompanying notes are an integral part of the consolidated
financial statements.


                         R&B FALCON CORPORATION
                            AND SUBSIDIARIES

                  CONSOLIDATED STATEMENT OF OPERATIONS
                 (in millions except per share amounts)
                              (unaudited)

                                   THREE MONTHS ENDED   SIX MONTHS ENDED
                                         JUNE 30,            JUNE 30,
                                   ------------------   -----------------
                                     1999       1998     1999      1998
                                   -------    -------   -------   -------
OPERATING REVENUES:
 Deepwater                         $  86.3    $  97.4   $ 176.5   $ 197.0
 Shallow water                        48.3      110.3     115.1     217.2
 Inland water                         25.4       73.3      56.4     146.0
 Engineering services and land
   operations                         66.4         .1     122.2        .2
 Development                            .1         -         .1        -
                                   -------    -------   -------   -------
   Total operating revenues          226.5      281.1     470.3     560.4
                                   -------    -------   -------   -------
COSTS AND EXPENSES:
 Deepwater                            38.9       46.1      82.2      88.1
 Shallow water                        33.7       40.6      82.0      79.6
 Inland water                         28.1       45.1      56.0      84.2
 Engineering services and land
   operations                         50.7         .1      89.0        .2
 Development                           2.5         .2       3.5       8.0
 Depreciation and amortization        38.1       22.6      74.6      44.0
 General and administrative           25.6       15.3      41.4      29.4
 Merger expenses                        -          -         -       (1.0)
                                   -------    -------   -------   -------
     Total costs and expenses        217.6      170.0     428.7     332.5
                                   -------    -------   -------   -------
OPERATING  INCOME                      8.9      111.1      41.6     227.9
                                   -------    -------   -------   -------
OTHER INCOME (EXPENSE):
 Interest expense, net of
   capitalized interest              (42.8)     (15.7)    (71.2)    (29.1)
 Interest income                      10.3        3.3      14.9       5.0
 Income from equity investees
   plus related income                 5.7         -        6.3        -
 Other, net                            (.1)        .1       (.3)       .2
                                   -------    -------   -------   -------
      Total other income (expense)   (26.9)     (12.3)    (50.3)    (23.9)
                                   -------    -------   -------   -------
INCOME (LOSS) FROM CONTINUING
  OPERATIONS BEFORE INCOME TAXES,
  MINORITY INTEREST AND
  EXTRAORDINARY LOSS                 (18.0)      98.8      (8.7)    204.0
                                   -------    -------   -------   -------
INCOME TAX EXPENSE  (BENEFIT):
 Current                              10.8        5.6      18.6      12.4
 Deferred                            (17.2)      30.5     (21.7)     65.1
                                   -------    -------   -------   -------
    Total income tax
     expense (benefit)                (6.4)      36.1      (3.1)     77.5
                                   -------    -------   -------   -------
MINORITY INTEREST                     (2.6)      (2.8)     (5.3)     (5.1)
                                   -------    -------   -------   -------
INCOME (LOSS) FROM CONTINUING
 OPERATIONS BEFORE
 EXTRAORDINARY LOSS                  (14.2)      59.9     (10.9)    121.4
INCOME FROM DISCONTINUED OPERATIONS     -          .5        -        8.8
EXTRAORDINARY LOSS, NET OF
  TAX BENEFIT                           -       (22.0)     (1.7)    (22.0)
                                   -------    -------   -------   -------
NET INCOME (LOSS)                    (14.2)      38.4     (12.6)    108.2
DIVIDENDS AND ACCRETION ON
  PREFERRED STOCK                      9.1         -        9.1        -
                                   -------    -------   -------   -------
NET INCOME (LOSS) APPLICABLE
 TO COMMON STOCKHOLDERS            $ (23.3)   $  38.4   $ (21.7)  $ 108.2
                                   =======    =======   =======   =======
NET INCOME (LOSS) PER COMMON SHARE:
  Basic:
     Continuing operations         $  (.12)   $   .36   $  (.10)  $   .74
     Discontinued operations           -          .01       -         .05
     Extraordinary loss                -         (.13)     (.01)     (.13)
                                   -------    -------   -------   -------
       Net income (loss)           $  (.12)   $   .24   $  (.11)  $   .66
                                   =======    =======   =======   =======
  Diluted:
     Continuing operations         $  (.12)   $   .36   $  (.10)  $   .74
     Discontinued operations           -          -         -         .05
     Extraordinary loss                -         (.13)     (.01)     (.13)
                                   -------    -------   -------   -------
       Net income (loss)           $  (.12)   $   .23   $  (.11)  $   .66
                                   =======    =======   =======   =======
WEIGHTED AVERAGE COMMON
  SHARES OUTSTANDING:
  Basic                              192.6      165.3     192.5     165.1
                                   =======    =======   =======   =======
  Diluted                            193.7      166.6     193.5     167.5
                                   =======    =======   =======   =======

The accompanying notes are an inegral part of the consolidated financial
statements.


                        R&B FALCON CORPORATION
                           AND SUBSIDIARIES

                 CONSOLIDATED STATEMENT OF CASH FLOWS
                       (in millions)(unaudited)
                                                    SIX MONTHS ENDED
                                                       JUNE 30,
                                                   ------------------
                                                     1999       1998
                                                   -------    -------
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net income (loss)                                  $ (12.6)  $ 108.2
 Adjustments to reconcile net income to net cash
   provided by operating activities:
  Depreciation and amortization                        74.6      44.0
  Deferred income taxes                               (22.4)     64.9
  Gain on dispositions of
    property and equipment                             (4.9)     (2.2)
  Recognition of deferred expenses                      5.8       5.9
  Deferred compensation                                 3.4        .4
  Income from equity investees plus related income     (6.3)       -
  Minority interest in income of
    consolidated subsidiaries                           5.3       5.1
  Dryhole and exploration expenses relating
    to oil and gas properties                            -        7.0
  Income from discontinued operations                    -       (8.8)
  Extraordinary loss from extinguishment
    of debt, net of tax benefit                         1.7      22.0
  Changes in assets and liabilities:
    Accounts receivable, net                           61.6     (62.1)
    Materials and supplies inventory                   (7.7)     (6.8)
    Drilling contracts in progress                      2.8        -
    Deferred charges and other assets                 (22.8)    (23.6)
    Accounts payable - trade                           10.1     (24.8)
    Accrued liabilities                               (11.5)    (22.5)
    Accrued interest                                   30.4       4.0
    Income taxes                                        4.7     (18.5)
    Other, net                                           .6      (2.0)
                                                    -------   -------
     Net cash provided by operating activities        112.8      90.2
                                                    -------   -------
 CASH FLOWS FROM INVESTING ACTIVITIES:
  Dispositions of property and equipment                5.7       3.1
  Purchases of property and equipment,
    exclusive of noncash items                       (440.3)   (483.4)
  Purchase of short-term investments                 (175.7)    (17.7)
  Increase in investments in and advances to
    unconsolidated investees                         (156.7)       -
                                                    -------   -------
      Net cash used in investing activities          (767.0)   (498.0)
                                                    -------   -------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Net payments on revolving credit facilities        (150.0)   (432.0)
  Increase (decrease) in short-term obligations      (123.4)     96.7
  Proceeds from long-term obligations               1,000.0   1,094.0
  Net proceeds from issuance of preferred stock       288.8        -
  Principal payments on long-term obligations          (8.2)   (285.5)
  Premium paid on debt extinguishment                    -      (25.1)
  Distribution to minority shareholders of
     consolidated subsidiaries                        (27.6)     (4.0)
  Other                                                  .4       1.2
                                                    -------   -------
    Net cash provided by financing activities         980.0     445.3
                                                    -------   -------
CASH PROVIDED BY (USED IN) BUSINESS HELD FOR SALE       2.4     (23.5)
                                                    -------   -------
NET INCREASE IN CASH AND CASH EQUIVALENTS             328.2      14.0

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD      177.4      55.5
                                                    -------   -------
CASH AND CASH EQUIVALENTS AT END OF PERIOD          $ 505.6   $  69.5
                                                    =======   =======
Supplemental Cash Flow Disclosures:
  Interest paid                                     $  74.3   $  39.0
  Income taxes paid                                 $  13.7   $  27.6
  Purchase of property and equipment in
    exchange for debt or equity                     $   9.2   $  35.5

The accompanying notes are an integral part of the consolidated
  financial statements.


                     R&B FALCON CORPORATION
                        AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          (unaudited)


A)   SIGNIFICANT ACCOUNTING POLICIES

          CASH  AND CASH EQUIVALENTS - In the second quarter of 1999,
     the  Company's  majority-owned  subsidiary  Arcade  Drilling  AS
     ("Arcade")  declared a distribution of $27.8 million,  of  which
     the Company received $17.6 million, net of withholding taxes. At
     June  30,  1999, Arcade's cash, cash equivalents and  short-term
     investments balance was $17.5 million.

          REVENUE  RECOGNITION  - In the first  quarter  of  1999,  a
     customer terminated a drilling contract for one of the Company's
     third-generation  semisubmersibles and the Company  received  an
     early  termination fee of $7.2 million. The semisubmersible  was
     immediately contracted to another customer and as a  result  the
     Company recognized the early termination fee as revenue  in  the
     first quarter of 1999.

          CAPITALIZED  INTEREST  - The Company  capitalizes  interest
     applicable to the construction and significant upgrades  of  its
     marine equipment as a cost of such assets.  Interest capitalized
     for  the  three  months ended June 30, 1999 and 1998  was  $21.4
     million  and $9.1 million, respectively and for the  six  months
     ended  June  30,  1999  and  1998 was $36.0  million  and  $15.3
     million,  respectively.  Interest capitalized is included  as  a
     reduction  of interest expense in the Consolidated Statement  of
     Operations.

          EXTRAORDINARY  LOSS  - In the first quarter  of  1999,  the
     Company incurred an extraordinary loss of $1.7 million, net of a
     tax  benefit of $.9 million, due to the early extinguishment  of
     debt  obligations.  Such  loss consisted  of  the  write-off  of
     unamortized debt issuance costs (see Note B).

          RECLASSIFICATION  -  Certain prior period  amounts  in  the
     consolidated  financial statements have  been  reclassified  for
     comparative purposes.  Such reclassifications had no  effect  on
     net income or the overall financial condition of the Company.

B)   LONG-TERM OBLIGATIONS

                                                    (in millions)
                                                    -------------
      Debt obligations at December 31, 1998           $ 1,872.5
        Proceeds from debt offering (1)                 1,000.0
        Proceeds from credit facility (2)                 200.0
        Payment on retired credit facility (2)           (350.0)
        Payments on debt obligations other
          than credit facility                             (8.2)
        Other                                               1.0
                                                      ---------
      Debt obligations at June 30, 1999                 2,715.3
        Less long-term obligations due
           within one year                                 (5.3)
                                                      ---------
      Long-term obligations at June 30, 1999          $ 2,710.0
                                                      =========

   (1)  In  March  1999, the Company issued $200.0 million of 12.25%
        Senior Notes due 2006 (the "Senior Notes").  Also  in  March
        1999, RBF Finance Co., a limited purpose finance company and
        a consolidated  affiliate  of  the  Company,  issued  $400.0
        million of 11% Senior Secured  Notes  due  2006  and  $400.0
        million  of   11.375%   Senior   Secured   Notes  due   2009
        (collectively the "Secured Notes"). The Company borrowed the
        proceeds  from  the  Secured  Notes  from  RBF  Finance  Co.
        pursuant to ten separate loan agreements, each of  which  is
        secured by  one  of  the  Company's  drilling  rigs  or  the
        construction contract to build a drilling rig.  The  Company
        also guaranteed the payment of the  Secured  Notes issued by
        RBF Finance Co. Interest is payable semiannually on March 15
        and September 15 on both the Senior Notes and Secured Notes.
        As  a  result,  the   Company  received   net  proceeds   of
        approximately   $971.5   million  after  deducting  offering
        expenses. The Company used the proceeds  to  repay  existing
        indebtedness  of  $350.0  million of  long-term obligations,
        $125.0 million  of  short-term  obligations (see Note C) and
        the Company's portion ($81.0 million) of an interim facility
        for the construction of the  Deepwater  Frontier.  Remaining
        proceeds will be  used  for  planned  capital  expenditures,
        working capital and other general corporate  purposes.  As a
        result  of  the  repayment  of  existing  indebtedness,  the
        Company incurred an extraordinary loss of $1.7  million, net
        of  tax, in the first quarter of 1999 which consisted of the
        write-off of unamortized debt issuance costs.
   (2)  During  the  first  quarter  of  1999,  the Company drew the
        remaining  $200.0 million available under its $350.0 million
        revolving   credit  facility.   The  Company  retired   such
        facility  during  the  first  quarter with proceeds from the
        Senior Notes and Secured Notes.

C)   SHORT-TERM OBLIGATIONS

           During  the  first quarter of 1999, the Company  drew  the
     remaining $1.6 million available under its $125.0 million short-
     term  credit  facility  for the construction  of  the  Deepwater
     Millennium.   In  March 1999, the Company repaid  such  facility
     with proceeds from the Senior Notes and Secured Notes.

D)   PREFERRED STOCK

          On  April  22, 1999, the Company issued 300,000  shares  of
     13.875%  Senior  Cumulative  Redeemable  Preferred  Stock   (the
     "Preferred Stock") and warrants to purchase 10,500,000 shares of
     the  Company's common stock at an exercise price  of  $9.50  per
     share  (the  "Warrants"). The Company received net  proceeds  of
     approximately $288.8 million from the issuance of the  Preferred
     Stock  and  Warrants.   Each  share of  Preferred  Stock  has  a
     liquidation  preference of $1,000 per share and one  Warrant  to
     purchase  35 shares of the Company's common stock.  The Warrants
     became  exercisable  on  July 7, 1999, the  date  in  which  the
     registration  of  the Preferred Stock with  the  Securities  and
     Exchange Commission was declared effective.  The Warrants expire
     on, and the Preferred Stock must be redeemed by, May 1, 2009.

          Dividends are to be paid quarterly commencing on August  1,
     1999  and at the Company's option may be paid in cash or, on  or
     before  May  1,  2004, in additional shares of Preferred  Stock.
     Accrued and unpaid dividends for the three and six months  ended
     June  30,  1999  were $8.0 million. The Warrants'  initial  fair
     value of $159.95 per Warrant, or approximately $48.0 million  in
     total, was recorded as a discount to the Preferred Stock and  an
     addition  to  capital in excess of par.  The  Warrants'  initial
     fair value and Preferred Stock offering expenses of $9.3 million
     are  being amortized on a straight line basis over the Warrants'
     ten year term. Amortization expense for the three and six months
     ended  June 30, 1999 was $1.1 million. Preferred Stock dividends
     and   the  amortization  of  the  Warrants'  initial  value  and
     Preferred  Stock offering expenses are deducted from net  income
     to arrive at net income applicable to common stockholders.

          The Company may redeem the Preferred Stock beginning May 1,
     2004.   The  initial  redemption  price  is  106.938%   of   the
     liquidation preference, declining thereafter to 100% on or after
     May  1, 2007, in each case plus accrued and unpaid dividends  to
     the  redemption date. In addition, on or before May 1, 2002, the
     Company  may  redeem  shares of the Preferred  Stock  having  an
     aggregate  liquidation preference of up to $105.0 million  at  a
     price  equal  to  113.875% of its liquidation  preference,  plus
     accrued  and  unpaid  dividends to  the  redemption  date,  with
     proceeds from one or more public equity offerings.

E)   COMMITMENTS AND CONTINGENCIES

          In  1998,  the Company cancelled four drillship  conversion
     projects  in  which the Company had purchased  or  committed  to
     purchase  drilling  equipment for such  projects.  Much  of  the
     equipment originally ordered has already been directed to  other
     construction  projects.  As of June 30, 1999,  the  Company  had
     approximately  $61.7 million remaining of such surplus  drilling
     equipment.  The  Company  expects to use  some  of  the  surplus
     equipment on other construction and/or upgrade projects  and  to
     maintain  the balance as inventory.   The Company is continually
     reviewing the value and utility of such equipment and if in  the
     future  it  is determined that some of the surplus equipment  is
     not  usable  for other projects or as spare parts,  the  Company
     could  incur  a  write-off or write-down of such equipment.   At
     present,  it  is  not possible to determine  the  likelihood  or
     quantify the amount of any such potential write-off.

          In  June 1999, one of the Company's inland drilling  barges
     was  lost  as  a result of a blowout and fire at a  location  in
     inland  waters  approximately two  miles  southeast  of  Amelia,
     Louisiana.   No  injuries  of  personnel  were  sustained.   The
     Company  believes  that such loss and clean-up expenses  related
     thereto will not have a material adverse impact on the Company's
     financial  condition.  In addition, the  Company  believes  that
     adequate physical damage and liability insurance coverage is  in
     place  to  cover  the  loss of the drilling barge.  The  Company
     expects to record a gain of approximately $17.0 million  in  the
     third  quarter  of  1999  if receipt of  insurance  proceeds  is
     assured.

F)   SEGMENT INFORMATION

           Segment  information for the three and six  month  periods
     ended June 30, 1999 and 1998 is as follows (in millions):

                                  Three Months Ended    Six Months Ended
                                       June 30,              June 30,
                                  ------------------    -----------------
                                    1999       1998       1999      1998
                                  -------    -------    -------   -------
    Operating revenues by segment:
      Deepwater                   $  86.3    $  97.4    $ 176.5   $ 197.0
      Shallow water                  50.5      110.3      117.8     217.2
      Inland water                   25.9       73.3       56.9     146.0
      Engineering services
         and land operations         66.4         .1      122.2        .2
      Development                      .1         -          .1        -
      Intersegment                   (2.7)        -        (3.2)       -
                                  -------    -------    -------   -------
        Total operating revenues  $ 226.5    $ 281.1    $ 470.3   $ 560.4
                                  =======    =======    =======   =======

    Operating income (loss) by segment:
      Deepwater                   $  33.8    $  40.7    $  67.8   $  87.6
      Shallow water                    -        63.7        4.7     125.8
      Inland water                   (9.6)      22.3      (13.4)     51.1
      Engineering services
         and land operations         13.6         -        29.2        -
      Development                    (2.4)       (.2)      (3.5)     (8.0)
                                  -------    -------    -------   -------
                                     35.4      126.5       84.8     256.5
      Unallocated depreciation
         and amortization             (.9)       (.1)      (1.8)      (.2)
      Unallocated general
         and administrative         (25.6)     (15.3)     (41.4)    (29.4)
      Unallocated merger
         expenses                      -          -          -        1.0
                                  -------    -------    -------   -------
      Operating income            $   8.9    $ 111.1    $  41.6   $ 227.9
                                  =======    =======    =======   =======

          Total assets by segment were as follows (in millions):

                                   June 30,    December 31,
                                     1999          1998
                                  ---------    ------------
      Deepwater                   $ 2,593.3     $ 2,078.6
      Shallow water                   959.0       1,038.5
      Inland water                    210.1         251.2
      Engineering services
         and land operations          156.8         156.9
      Development                       4.8          10.5
      Corporate                       783.3         173.6
                                  ---------     ---------
         Total                    $ 4,707.3     $ 3,709.3
                                  =========     =========

          For  the three and six months ended June 30, 1999, revenues
     from   one   customer  in  Venezuela  (PDVSA   Exploration   and
     Production)  of  $38.6 million and $82.0 million,  respectively,
     reported   in  the  engineering  services  and  land  operations
     segment,  accounted  for 17.0% and 17.4%, respectively,  of  the
     Company's consolidated operating revenues.

G)   EARNINGS PER SHARE

          The  following table summarizes the basic and  diluted  per
     share  computations for income from continuing operations before
     extraordinary  loss  for the three and six month  periods  ended
     June 30, 1999 and 1998 (in millions except per share amounts):

                                        Three Months        Six Months
                                       Ended June 30,      Ended June 30,
                                     -----------------   ------------------
                                       1999      1998      1999       1998
                                     -------   -------   -------    -------
Numerator:
Income (loss) from continuing
  operations before
   extraordinary  loss               $ (14.2)  $  59.9   $ (10.9)   $ 121.4
Dividends and accretion on
  preferred stock                       (9.1)       -       (9.1)        -
                                     -------   -------   -------    -------
Income (loss) from continuing
  operations before extraordinary
    loss - basic                       (23.3)     59.9     (20.0)     121.4
Interest on convertible debentures        -         -         -         2.1
                                     -------   -------   -------    -------
Income (loss) from continuing
  operations before extraordinary
   loss  -  diluted                  $ (23.3)  $  59.9   $ (20.0)   $ 123.5
                                     =======   =======   =======    =======
Denominator:
Weighted average common
    shares outstanding - basic         192.6     165.3     192.5      165.1
Outstanding stock options and
    restricted stock awards              1.1       1.3       1.0        1.4
Convertible debentures                    -         -         -         1.0
                                     -------   -------   -------    -------
Weighted average common
    shares outstanding - diluted       193.7     166.6     193.5      167.5
                                     =======   =======   =======    =======
Earnings per share:
Income (loss) from continuing operations
  before extraordinary loss:
       Basic                         $  (.12)  $   .36   $  (.10)   $   .74
       Diluted                       $  (.12)  $   .36   $  (.10)   $   .74


          The  Warrants  were  not included in diluted  earnings  per
     share for the three and six month periods ended June 30, 1999 as
     they were anti-dilutive during these periods.

H)   STOCK AWARDS

          During  the  first six months of 1999, the Company  granted
     stock  options, with respect to the Company's common  stock,  of
     approximately  7.4 million shares to certain  employees  of  the
     Company  and  approximately .5 million  shares  to  non-employee
     members  of the board of directors. Such options vest at varying
     times  from six months to three years and were granted at prices
     ranging from $6.15625 to $10.0625 per share (the market price on
     the  date of grants). All such options expire ten years from the
     date of grant.

          In  the  second  quarter  of 1999, a wholly-owned  indirect
     subsidiary of the Company made awards of restricted stock of the
     subsidiary to certain directors, officers and employees  of  the
     Company, as well as awards of restricted stock to certain former
     directors  of  Reading & Bates Corporation who  served  in  such
     capacity  prior to completion of the merger with Falcon Drilling
     Company,  Inc.  in  December  1997.   Such  award  comprised  of
     approximately  13.75% of the outstanding common  stock  of  such
     subsidiary.  The awards vested upon issuance, but are subject to
     restrictions  on  sale or transfer for a period  of  six  months
     following  the  date  of  the award. As a  result,  the  Company
     incurred  $1.5  million of expense which has  been  included  in
     general and administrative expenses for the three and six  month
     periods ended June 30, 1999.

I)   RESTRUCTURING EXPENSES

          On  April  7, 1999, the Company announced that  Mr.  Steven
     Webster,  the  Company's president and chief executive  officer,
     had  agreed to resign from these officer positions effective May
     31,  1999. On May 19, 1999, Mr. Paul B. Loyd, Jr., the Company's
     chairman  of  the  board,  was elected as  the  Company's  chief
     executive  officer,  and  Mr.  Andrew  Bakonyi  was  elected  as
     president and chief operating officer. Mr. Webster will remain a
     director of the Company.

          As   a   result  of  Mr.  Webster's  resignation  and   the
     termination  of  certain other executive officers,  the  Company
     incurred $6.6 million of expense in the second quarter of  1999.
     Such  expense is reported as general and administrative  expense
     in the Company's Consolidated Statement of Operations.


               REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS



To the Board of Directors and Stockholders
R&B Falcon Corporation


     We  have reviewed the accompanying consolidated balance sheet  of
R&B Falcon Corporation (a Delaware corporation) and Subsidiaries as of
June  30,  1999, the related consolidated statement of operations  for
the  three and six month periods ended June 30, 1999 and 1998 and  the
related consolidated statement of cash flows for the six months  ended
June   30,  1999  and  1998.  These  financial  statements   are   the
responsibility of the Company's management.

     We  conducted our review in accordance with standards established
by  the  American Institute of Certified Public Accountants.  A review
of  interim  financial  information consists principally  of  applying
analytical  procedures  to  financial data  and  making  inquiries  of
persons  responsible  for  financial and accounting  matters.   It  is
substantially less in scope than an audit conducted in accordance with
generally accepted auditing standards, the objective of which  is  the
expression of an opinion regarding the financial statements taken as a
whole.  Accordingly, we do not express such an opinion.

     Based  upon  our  review,  we  are  not  aware  of  any  material
modifications that should be made to the financial statements referred
to  above  for  them  to  be  in conformity  with  generally  accepted
accounting principles.



/s/Arthur Andersen LLP
Arthur Andersen LLP

Houston, Texas
July 23, 1999



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

Industry Conditions

     Activity  in  the  contract  drilling industry  and  related  oil
service businesses has deteriorated significantly in the past year due
to  decreased worldwide demand for drilling rigs and related  services
resulting  from a substantial decline in crude oil prices.  In  recent
months, crude oil prices have recovered somewhat, but there can be  no
assurance  that  demand  for drilling rigs and related  services  will
increase.  The  financial condition and results of operations  of  the
Company and other drilling contractors are dependent upon the price of
oil  and  natural  gas,  as  demand for their  services  is  primarily
dependent  upon  the level of spending by oil and  gas  companies  for
exploration, development and production activities. In late  1998  and
early 1999, lower crude oil prices affected exploration and production
spending,  which created significantly lower dayrates and  utilization
for  offshore  drilling companies, particularly in the  U.S.  Gulf  of
Mexico.  Crude oil and natural gas prices have continued to  fluctuate
over  the last several years. If crude oil prices decline from current
levels,  or  a weakness in crude oil prices continued for an  extended
period, there could be a further deterioration in both rig utilization
and dayrates.

     Utilization of the Company's domestic jack-up fleet has  declined
from  approximately 93% in the second quarter of 1998 to approximately
40% in the second quarter of 1999, and dayrates have declined from  an
average of $36,000 during the second quarter of 1998 to an average  of
$12,000 during the second quarter of 1999.  Dayrates for the Company's
domestic  barge  drilling rig fleet have not declined materially,  but
utilization of the fleet declined from approximately 80% in the second
quarter of 1998 to approximately 25% in the second quarter of 1999. As
a result, the Company experienced a decline in operating revenues from
the  first  six months of 1998 to the first six months  of  1999  (see
Results of Operations below).

Results of Operations

                SIX MONTHS ENDED JUNE 30, 1999 COMPARED
                  TO SIX MONTHS ENDED JUNE 30, 1998

     The Company's net loss for the six months ended June 30, 1999 was
$12.6  million  ($.11  loss per diluted share  after  preferred  stock
dividends  and accretion of $9.1 million) compared with net income  of
$108.2  million ($.66 per diluted share) for the same period of  1998.
Included in the results for the six months ended June 30, 1999  was  a
$1.7  million  extraordinary loss due to the  extinguishment  of  debt
obligations.   Included in the results for the six months  ended  June
30,   1998  was  a  $22.0  million  extraordinary  loss  due  to   the
extinguishment of debt obligations and $8.8 million of income  related
to discontinued operations.

     Operating  revenues  are  primarily a function  of  dayrates  and
utilization.  Operating revenues decreased for the  six  months  ended
June  30,  1999 compared to the same period in 1998 despite  a  $158.8
million  revenue  increase  generated  from  the  purchase  of  Cliffs
Drilling  in December 1998. The revenue decrease is primarily  due  to
lower  utilization and dayrates in the shallow water and inland  water
segments.   Partially  offsetting the decrease  was  $7.2  million  of
revenue  recorded  in  the  first  quarter  of  1999  for  the   early
termination  of  a  drilling contract for one of its  third-generation
semisubmersibles.  For the six months ended June  30,  1999,  revenues
from  one customer in Venezuela (PDVSA Exploration and Production)  of
$82.0   million,  reported  in  the  engineering  services  and   land
operations  segment,  accounted  for  17.4%  of  the  Company's  total
operating revenues.

     Operating expenses do not necessarily fluctuate in proportion  to
changes in operating revenues due to the continuation of personnel  on
board  and equipment maintenance when the Company's units are stacked.
It  is only during prolonged stacked periods that the Company is  able
to significantly reduce labor costs and equipment maintenance expense.
Additionally,   labor   costs  fluctuate   due   to   the   geographic
diversification  of the Company's units and the mix of  labor  between
expatriates and nationals as stipulated in the contracts.  In general,
labor  costs  increase  primarily due  to  higher  salary  levels  and
inflation.   Equipment maintenance expenses fluctuate  depending  upon
the  type of activity the unit is performing and the age and condition
of  the  equipment.  Scheduled maintenance and overhauls of  equipment
are  performed on the basis of number of hours operated in  accordance
with the Company's preventive maintenance program.  Operating expenses
for a unit are typically deferred or capitalized as appropriate during
periods  of  mobilization,  contract preparation,  major  upgrades  or
conversions unless corresponding revenue is recognized, in which  case
such costs are expensed as incurred.

     The  increase in operating expenses for the six months ended June
30,  1999 as compared to the same period in 1998 is primarily  due  to
the purchase of Cliffs Drilling in December 1998, partially offset  by
lower  operating  expenses  in  the shallow  water  and  inland  water
segments  due  to  lower  utilization.  Included  as  a  reduction  of
operating expenses for the six months ended June 30, 1999 is  an  $8.3
million gain in the shallow water segment due to the W.D. Kent derrick
equipment  casualty. Such casualty occurred in the  third  quarter  of
1997  as  a  result of a blowout and fire.  Also included in operating
expenses  for  the six months ended June 30, 1999 is $2.4  million  of
expense  in  the  inland  water segment  relating  to  a  reserve  for
potentially uncollectable receivables.

      Depreciation  and  amortization expense increased  for  the  six
months  ended  June 30, 1999 as compared to the same period  in  1998.
Such  increase is primarily due to the purchase of Cliffs Drilling  in
December 1998 and the purchase and/or significant upgrades of offshore
and inland marine vessels during 1998.

     General  &  administrative expense increased for the  six  months
ended  June  30,  1999 as compared to the same period  in  1998.  Such
increase is due to $6.6 million of executive termination expense, $1.5
million of employee incentive compensation expense and the purchase of
Cliffs Drilling in December 1998.

     Interest expense increased for the six months ended June 30, 1999
as  compared  to  the same period in 1998 primarily due  to  increased
average  debt  balances  outstanding and  increased  average  interest
rates,  partially offset by increased capitalized interest related  to
significant upgrade and new build projects.

     Interest income increased for the six months ended June 30,  1999
as compared to the same period in 1998 due to increased cash and short-
term investment balances during the period.

     Income  from  equity investees plus related income increased  for
the  six months ended June 30, 1999 as compared to the same period  in
1998  due to the Deepwater Pathfinder and the Deepwater Frontier  both
of  which commenced operations in the latter part of the first quarter
of 1999.

     Income  tax expense decreased for the six months ended  June  30,
1999 as compared to the same period in 1998 due to the decrease in the
Company's pretax income.

     Income from discontinued operations for the six months ended June
30,  1998 was the reversal of accrued estimated losses from operations
until   disposal  resulting  from  the  accounting  requirements   for
recontinuance.

     Extraordinary losses for the six months ended June  30,  1999  of
$1.7 million, after a tax benefit of $.9 million, (see Note B of Notes
to  Consolidated  Financial Statements) and for the six  months  ended
June  30, 1998 of $22.0 million, after a tax benefit of $11.9 million,
are  both  due  to  the  extinguishment of prior debt  obligations  in
connection with the issuance of new debt obligations.


               THREE MONTHS ENDED JUNE 30, 1999 COMPARED
                 TO THREE MONTHS ENDED JUNE 30, 1998

     The  Company's net loss for the three months ended June 30,  1999
was  $14.2 million ($.12 loss per diluted share after preferred  stock
dividends  and accretion of $9.1 million) compared with net income  of
$38.4  million ($.23 per diluted share) for the same period  of  1998.
Included in the results for the three months ended June 30, 1998 was a
$22.0  million  extraordinary loss due to the extinguishment  of  debt
obligations.

     Operating  revenues  are  primarily a function  of  dayrates  and
utilization.  Operating revenues decreased for the three months  ended
June  30,  1999  compared to the same period in 1998 despite  a  $79.0
million  revenue  increase  generated  from  the  purchase  of  Cliffs
Drilling in December 1998.  The revenue decrease is primarily  due  to
lower  utilization and dayrates in the shallow water and inland  water
segments. For the three months ended June 30, 1999, revenues from  one
customer  in  Venezuela (PDVSA Exploration and  Production)  of  $38.6
million,  reported  in the engineering services  and  land  operations
segment,   accounted  for  17.0%  of  the  Company's  total  operating
revenues.

     Operating expenses do not necessarily fluctuate in proportion  to
changes in operating revenues due to the continuation of personnel  on
board  and equipment maintenance when the Company's units are stacked.
It  is only during prolonged stacked periods that the Company is  able
to significantly reduce labor costs and equipment maintenance expense.
Additionally,   labor   costs  fluctuate   due   to   the   geographic
diversification  of the Company's units and the mix of  labor  between
expatriates and nationals as stipulated in the contracts.  In general,
labor  costs  increase  primarily due  to  higher  salary  levels  and
inflation.   Equipment maintenance expenses fluctuate  depending  upon
the  type of activity the unit is performing and the age and condition
of  the  equipment.  Scheduled maintenance and overhauls of  equipment
are  performed on the basis of number of hours operated in  accordance
with the Company's preventive maintenance program.  Operating expenses
for a unit are typically deferred or capitalized as appropriate during
periods  of  mobilization,  contract preparation,  major  upgrades  or
conversions unless corresponding revenue is recognized, in which  case
such costs are expensed as incurred.

     The  increase  in operating expenses for the three  months  ended
June 30, 1999 as compared to the same period in 1998 is primarily  due
to  the purchase of Cliffs Drilling in December 1998, partially offset
by  lower  operating expenses in the shallow water  and  inland  water
segments  due  to  lower  utilization.  Included  as  a  reduction  of
operating expenses for the three months ended June 30, 1999 is an $8.3
million gain in the shallow water segment due to the W.D. Kent derrick
equipment  casualty. Such casualty occurred in the  third  quarter  of
1997  as  a  result of a blowout and fire.  Also included in operating
expenses  for the three months ended June 30, 1999 is $2.4 million  of
expense  in  the  inland  water segment  relating  to  a  reserve  for
potentially uncollectable receivables.

      Depreciation  and amortization expense increased for  the  three
months  ended  June 30, 1999 as compared to the same period  in  1998.
Such  increase is primarily due to the purchase of Cliffs Drilling  in
December 1998 and the purchase and/or significant upgrades of offshore
and inland marine vessels during 1998.

     General  & administrative expense increased for the three  months
ended  June  30,  1999 as compared to the same period  in  1998.  Such
increase is due to $6.6 million of executive termination expense, $1.5
million of employee incentive compensation expense and the purchase of
Cliffs Drilling in December 1998.

     Interest  expense increased for the three months ended  June  30,
1999 as compared to the same period in 1998 primarily due to increased
average  debt  balances  outstanding and  increased  average  interest
rates,  partially offset by increased capitalized interest related  to
significant upgrade and new build projects.

     Interest  income increased for the three months  ended  June  30,
1999 as compared to the same period in 1998 due to increased cash  and
short-term investment balances during the period.

     Income  from  equity investees plus related income increased  for
the three months ended June 30, 1999 as compared to the same period in
1998  due to the Deepwater Pathfinder and the Deepwater Frontier  both
of  which commenced operations in the latter part of the first quarter
of 1999.

     Income tax expense decreased for the three months ended June  30,
1999 as compared to the same period in 1998 due to the decrease in the
Company's pretax income.

Liquidity And Capital Resources

     Cash Flows

     Net  cash provided by operating activities was $112.8 million for
the  six months ended June 30, 1999 compared to $90.2 million for  the
same  period  in 1998.  Despite the decrease in net income,  net  cash
provided by operating activities increased primarily due to changes in
the components of working capital.

     Net  cash used in investing activities was $767.0 million for the
six months ended June 30, 1999 compared to $498.0 million for the same
period  in  1998.   The increase is primarily due to the  purchase  of
short-term  investments  coupled  with  investments  and  advances  of
approximately  $149.3 million made to the joint venture that  operates
the Deepwater Frontier.

     Net  cash provided by financing activities was $980.0 million for
the  six months ended June 30, 1999 compared to $445.3 million for the
same  period  in 1998.  The increase is due to proceeds received  from
the  $1.0 billion debt offering and the $300.0 million preferred stock
offering, offset by the repayment of certain existing debt obligations
(see below).

    Debt Issuance

     On  March  26,  1999, the Company issued three series  of  senior
notes  with an aggregate principal amount of $1.0 billion. The  senior
notes  consisted  of $400.0 million of 11% senior  secured  notes  due
2006,  $400.0  million of 11.375% senior secured notes  due  2009  and
$200.0  million  of  12.25% senior notes due 2006  (collectively,  the
"Senior   Notes").  The  $800.0  million  senior  secured  notes   are
collateralized by ten of the Company's drilling rigs. As a result, the
Company  received net proceeds of approximately $971.5  million  after
deducting  offering expenses. The Company used the proceeds  to  repay
existing  indebtedness  of  approximately  $556.0  million   and   the
remainder  will  be  used to acquire, construct,  repair  and  improve
drilling rigs and for general corporate purposes.  See Note B of Notes
to Consolidated Financial Statements.

     Preferred Stock Issuance

     On  April 22, 1999, the Company issued 300,000 shares of  13.875%
Senior  Cumulative Redeemable Preferred Stock (the "Preferred  Stock")
and  warrants  to  purchase 10,500,000 shares of the Company's  common
stock  at  an exercise price of $9.50 per share (the "Warrants").  The
Company received net proceeds of approximately $288.8 million from the
issuance of the Preferred Stock and Warrants.  Each share of Preferred
Stock has a liquidation preference of $1,000 per share and one Warrant
to  purchase  35 shares of the Company's common stock.   The  Warrants
became exercisable on July 7, 1999, the date in which the registration
of the Preferred Stock with the Securities and Exchange Commission was
declared  effective.  The Warrants expire on, and the Preferred  Stock
must be redeemed by, May 1, 2009.

     Dividends are to be paid quarterly commencing on August  1,  1999
and  at the Company's option may be paid in cash or, on or before  May
1,  2004, in additional shares of Preferred Stock. Accrued and  unpaid
dividends  for the three and six months ended June 30, 1999 were  $8.0
million.  The Warrants' initial fair value of $159.95 per Warrant,  or
approximately  $48.0 million in total, was recorded as a  discount  to
the  Preferred Stock and an addition to capital in excess of par.  The
Warrants' initial fair value and Preferred Stock offering expenses  of
$9.3  million  are being amortized on a straight line basis  over  the
Warrants' ten year term.  Amortization expense for the three  and  six
months ended June 30, 1999 was $1.1 million. Preferred Stock dividends
and  the  amortization of the Warrants' initial  value  and  Preferred
Stock offering expenses are deducted from net income to arrive at  net
income applicable to common stockholders.

     The Company may redeem the Preferred Stock beginning May 1, 2004.
The   initial   redemption  price  is  106.938%  of  the   liquidation
preference, declining thereafter to 100% on or after May 1,  2007,  in
each case plus accrued and unpaid dividends to the redemption date. In
addition,  on or before May 1, 2002, the Company may redeem shares  of
the  Preferred Stock having an aggregate liquidation preference of  up
to  $105.0  million  at a price equal to 113.875% of  its  liquidation
preference, plus accrued and unpaid dividends to the redemption  date,
with proceeds from one or more public equity offerings.

     Capital Expenditure Commitments

     The  Company  has  numerous  projects  under  way  involving  the
construction or upgrade of drilling units.  The following is a list of
such projects:

                  Water Depth    Estimated   Contract         Expenditures
                  Capability      Delivery     Term  Estimated   through
                    (feet)          Date      (years)  Cost    June 30, 1999
                    ------          ----      -------  ----    -------------
Drillships:                                             (in millions)
 DEEPWATER
   PATHFINDER (1)   10,000       Delivered       5  $  280.0    $  269.3
 DEEPWATER
   FRONTIER (2)     10,000       Delivered      2.5    265.0       252.6
 DEEPWATER
   MILLENNIUM       10,000       Delivered     4 (3)   280.0       251.7
 DEEPWATER
   DISCOVERY        10,000   3rd quarter 2000    3     305.0       117.6
 DEEPWATER
   EXPEDITION        9,200   3rd quarter 1999    6     230.0       199.1
   (formerly PEREGRINE IV)
 PEREGRINE VII (4)   8,200   4th quarter 1999    -     300.0       243.2
Semisubmersibles:
 FALCON 100 (5)     2,450       Delivered        -     125.0       120.5
 DEEPWATER NAUTILUS 8,000    4th quarter 1999    5     330.0       178.5
   (formerly RBS8M)
 DEEPWATER HORIZON  8,000    4th quarter 2000    3     335.0        21.0
   (formerly RBS8D)                                ---------   ---------
                                                   $ 2,450.0   $ 1,653.5
                                                   =========   =========

 (1) The  Company owns a 50% interest in the limited liability company
     that operates this drillship.
 (2) The Company owns a 60%  interest in the limited liability company
     that  operates  this  drillship.  Under the drilling contract for
     this drillship, the Company and Conoco have each committed to use
     this  rig for two and one half of  the  first  five  years  after
     delivery. Conoco used the rig to  drill  a  well  after the rig's
     delivery, and the Company will use it for  the  next  12  months.
     After this period, Conoco and the Company will  alternate the use
     of this rig.  The Company is currently  marketing the rig for the
     periods during which it is obligated to use the rig.
 (3) Statoil  will  use this drillship for the first three years after
     delivery,  then  the  Company  will alternate use of the rig with
     Statoil every six months for the next two years.
 (4) On  April  15,  1999,  BP Amoco cancelled its contract  with  the
     Company  for  this  drillship  in  accordance with the contract's
     terms  because the drillship had not been delivered on time.  The
     Company is currently marketing this rig for work.
 (5) In  May  1999,  Petrobras cancelled the drilling contract for the
     Falcon  100 based  on  its  interpretation  of  the  cancellation
     provisions  of  the  contract.  The Company does not believe that
     Petrobras has the right  to  cancel  such  contract.  The Company
     has engaged Brazilian counsel to evaluate  the  Company's  rights
     under the contract.

     The  Company's construction and upgrade projects are  subject  to
the   risks  of  delay  and  cost  overruns  inherent  in  any   large
construction  project,  including shortages of  equipment,  unforeseen
engineering    problems,   work   stoppages,   weather   interference,
unanticipated  cost  increases and shortages of materials  or  skilled
labor.  Significant cost overruns or delays would adversely affect the
Company's  liquidity, financial condition and results  of  operations.
Delays  could  also result in penalties under, or the termination  of,
the long-term contracts under which the Company plans to operate these
rigs.

     Liquidity

     During  the  first six months of 1999, the Company  received  net
proceeds of approximately $1.3 billion from the issuance of the Senior
Notes  and  Preferred Stock. The Company used the  proceeds  to  repay
existing  indebtedness  of  approximately  $556.0  million   and   the
remainder  will  be  used to acquire, construct,  repair  and  improve
drilling rigs and for general corporate purposes. As of June 30, 1999,
the  Company had $681.3 million of cash, cash equivalents  and  short-
term investments.

     The Company is currently in the process of completing two project
financings.   One  financing  in the amount  of  approximately  $270.0
million   is  in  the  form  of  a  synthetic  lease  that  would   be
collateralized by the drillship Deepwater Frontier, drilling  contract
revenues  from  such drillship and a $50.0 million letter  of  credit.
Proceeds  of  such financing would be used in part to  repay  advances
made to the joint venture which operates the Deepwater Frontier, which
is owned 60% by the Company and 40% by Conoco. The second financing in
the amount of approximately $250.0 million is a project financing that
would  be  collateralized  by the semisubmersible  Deepwater  Nautilus
(formerly RBS8M), as well as the drilling contract revenues from  such
rig.  The  Company is also considering certain asset sales,  including
the Seillean, Iolair and domestic boat business.

     The  Company is currently constructing or significantly upgrading
nine  deepwater  drilling  rigs.  The Company  estimates  its  capital
expenditure  commitments  on  these projects  and  its  other  routine
capital  expenditures for the remainder of 1999 to total approximately
$475.0 million.

     The  Company  believes its projected level  of  cash  flows  from
operations, which assumes an industry recovery in 2000, cash on  hand,
expected proceeds from the two project financings and potential  asset
sales will be sufficient to satisfy the Company's short-term and long-
term working capital needs, planned investments, capital expenditures,
debt,  lease  and  other payment obligations. If the Company  were  to
build  excess cash balances from the various sources mentioned  above,
it  will  most  likely  use a portion of the  excess  to  retire  debt
obligations.

     Other

     In  December  1998, Mobil North Sea Limited ("Mobil") purportedly
terminated   its  contract  for  use  of  the  Company's  Jack   Bates
semisubmersible rig based on failure of two mooring lines while anchor
recovery operations at a Mobil well location had been suspended during
heavy weather.  The contract provided for Mobil's use of the rig at  a
dayrate of approximately $115,000 for the primary term through January
1999  and  approximately $200,000 for the extension term from February
1999  through December 2000.  The Company does not believe that  Mobil
had   the   right  to  terminate  this  contract.   The  Company   has
recontracted  the Jack Bates to Mobil for one well  at  a  dayrate  of
$156,000 and for another well at a dayrate of $69,000. These contracts
are without prejudice to either party's rights in the dispute over the
termination of the original contract.  The Company has filed a request
for arbitration with the London Court of International Arbitration.

Year 2000

     The  Company has focused its Year 2000 ("Y2K") compliance efforts
in  three  areas: information technology systems, embedded  technology
systems and systems used by third parties with which the Company has a
substantial relationship. The Company has substantially completed  its
investigation and evaluation of these systems and is currently in  the
process of correcting the identified problems.

     Information Technology Systems.  The testing and validation phase
for information technology systems includes testing of each individual
information  technology system that could be  affected.   Through  the
information  technology systems investigation, the Company  determined
that  the  accounting  software utilized by Cliffs  Drilling  required
substantial  modification  or replacement.   The  domestic  accounting
software  was replaced with Y2K compliant software during  the  fourth
quarter  of  1998 at a total cost of approximately $2.3  million,  the
majority  of which was capitalized.  Software replacements  in  Cliffs
Drilling's  foreign offices will be completed during 1999 at  a  total
cost   of   approximately  $.5  million.   The  Company   additionally
determined  that  certain  of its remaining  accounting  software  and
systems were not Y2K compliant.  Company personnel have completed  the
majority  of  these  modifications  and  the  remaining  non-compliant
software  will  be undergoing a previously planned upgrade  in  August
1999.

     Embedded   Technology  Systems.   Embedded   technology   systems
primarily  relate  to the technology on board the  Company's  drilling
units.   The  testing and validation phase for the embedded technology
systems  includes testing each high and medium priority system,  which
consists  primarily of all systems located on drilling units  included
in  the  Deepwater and Shallow Water Divisions.  For systems on  board
the  Inland  Water  units,  confirmation of Y2K  compliance  has  been
received from the manufacturers of these systems.

     To  facilitate the embedded technology systems investigation, the
Company  hired an additional employee whose primary responsibility  is
the  evaluation  of  these technology systems.   This  evaluation  was
completed in the second quarter of 1999.  The equipment evaluated  did
not  demonstrate  any  equipment failures  or  other  significant  Y2K
compliance issues.  Based on these evaluations, the Company  estimates
that  the  total  cost  to  replace or upgrade non-compliant  embedded
technology systems will be less than $.5 million.

     Third  Party  Systems.  The Company is contacting  third  parties
with  which it has substantial relationships to determine what actions
may  be  needed  to mitigate its risks relating to the  effects  third
party  technology failures may have on the Company. The  Company  sent
out  requests for information to all of its electrical and  electronic
contractors  in August 1998 and has received information from  85%  of
them  regarding their Y2K efforts.  Questionnaires were  sent  in  the
first  quarter  of  1999 to all of the Company's suppliers  and  third
party  vendors.    Based on the responses received  thus  far,  it  is
evident  that our contractors and suppliers are placing a priority  on
achieving  Y2K compliance.  In the event the Company's major suppliers
or  customers  do not successfully and timely achieve Y2K  compliance,
the Company's operations could be adversely affected.

     Contingency Plans.  The Company is continuing to monitor,  on  an
ongoing basis, the problems and uncertainties associated with its  Y2K
issues and their potential consequences.  The Company has accepted the
position  that  there will be some finite levels  of  risk  that  some
systems will not fully function after Y2K.  A risk-based approach  has
identified those items where absolute compliance is not guaranteed  by
the  vendor or supplier, and contingency plans are being developed  to
deal  with any safety related possibilities.  These contingency  plans
were completed in the second quarter of 1999.

     In  addition  to  the safety related contingency  plans  directly
related  to uncertainties with equipment, the Company maintains  plans
for  all  critical  safety equipment as part of its  normal  business.
These  critical safety plans are currently being modified to  fit  the
Y2K criteria.  These modifications primarily include: having personnel
standing  by at critical equipment stations before the specified  time
changes,  having no crane lifts in operation and having  all  drilling
units  in  a  non-drilling mode. Failure of this  type  of  equipment,
whether  related to normal operational risk or Y2K problems,  must  be
managed  with contingency planning.  For this reason, additional  risk
due  to the Y2K issue does not measurably affect the risk to personnel
or equipment beyond the normal failure due to other causes.

Other

      On April 7, 1999, the Company announced that Mr. Steven Webster,
the  Company's  president and chief executive officer, had  agreed  to
resign from these officer positions effective May 31, 1999. On May 19,
1999, Mr. Paul B. Loyd, Jr., the Company's chairman of the board,  was
elected  as  the  Company's chief executive officer,  and  Mr.  Andrew
Bakonyi  was  elected  as president and chief operating  officer.  Mr.
Webster will remain a director of the Company.

      As a result of Mr. Webster's resignation and the termination  of
certain other executive officers, the Company incurred $6.6 million of
expense  in  the second quarter of 1999.  Such expense is reported  as
general  and  administrative  expense in  the  Company's  Consolidated
Statement of Operations.  See Results of Operations above.

     In  June  1999, one of the Company's inland drilling  barges  was
lost  as a result of a blowout and fire at a location in inland waters
approximately two miles southeast of Amelia, Louisiana.   No  injuries
of  personnel were sustained.  The Company believes that such loss and
clean-up  expenses  related thereto will not have a  material  adverse
impact  on the Company's financial condition. In addition, the Company
believes   that  adequate  physical  damage  and  liability  insurance
coverage  is  in  place to cover the loss of the drilling  barge.  The
Company expects to record a gain of approximately $17.0 million in the
third quarter of 1999 if receipt of insurance proceeds is assured.

     In 1998, the Company cancelled four drillship conversion projects
in  which  the Company had purchased or committed to purchase drilling
equipment for such projects. Much of the equipment originally  ordered
has  already been directed to other construction projects.  As of June
30,  1999,  the Company had approximately $61.7 million  remaining  of
such  surplus drilling equipment. The Company expects to use  some  of
the  surplus  equipment on other construction and/or upgrade  projects
and to maintain the balance as inventory.   The Company is continually
reviewing the value and utility of such equipment and if in the future
it  is determined that some of the surplus equipment is not usable for
other  projects or as spare parts, the Company could incur a write-off
or  write-down of such equipment.  At present, it is not  possible  to
determine  the likelihood or quantify the amount of any such potential
write-off.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

  The Company is exposed to changes in interest rates with respect  to
its  debt  obligations.  The following table sets  forth  the  average
interest  rate  for  the  scheduled maturity  of  the  Company's  debt
obligations as of June 30, 1999 (dollars in millions):

                                                                      Estimated
                                                                         Fair
                                                                       Value at
                                                                       June 30,
               1999   2000   2001   2002   2003  Thereafter   Total      1999
              ------ ------ ------ ------ ------ ---------- --------- ---------
Fixed Rate Debt:
 Amount       $   -  $  1.5 $  5.2  $  -  $ 550.1 $ 2,150.0 $ 2,706.8 $ 2,449.2
 Average
   interest
   rate       7.000% 8.000% 9.750%     -   8.340%   9.392%    9.179%
Variable Rate Debt:
 Amount       $  2.1 $  4.3 $  4.3 $   .4 $    -  $    -    $    11.1 $    11.1
 Average
   interest
   rate       7.000% 7.000% 7.000% 7.000%      -       -      7.000%


                      PART II - OTHER INFORMATION

Item 1.  Legal Proceedings

     The  Company is involved in various legal actions arising in  the
normal  course  of  business.   After taking  into  consideration  the
evaluation  of such actions by counsel for the Company, management  is
of  the opinion that the outcome of all known and potential claims and
litigation  will not have a material adverse effect on  the  Company's
business or consolidated financial position or results of operations.

Item 4.  Results of Votes of Security Holders

      At the annual meeting of stockholders of R&B Falcon Corporation,
held  on May 19, 1999, three Class II directors were elected by a vote
of  common  stockholders, as outlined in the Company's Proxy Statement
relating to such annual meeting.  Proxies for the annual meeting  were
solicited pursuant to Regulation 14 under the Securities and  Exchange
Act   of  1934,  there  was  no  solicitation  in  opposition  to  the
management's nominees as listed in the Proxy Statement and all of such
nominees  were elected, with 161,516,285, 161,515,291 and  161,515,790
votes   for  each  of  Mr.  Chavkin,  Mr.  Laqueur  and  Mr.  Ziegler,
respectively,  and 3,606,414,  3,607,408 and 3,606,909 votes  withheld
from   each  of  such  nominees,  respectively.   In  addition,  three
proposals  were  voted upon: (i) a proposal to approve  the  Company's
1999 Employee Long-Term Incentive Plan, with 143,358,920 votes for the
proposal,   21,050,753   votes  against  the  proposal   and   713,025
abstentions,   (ii) a proposal to approve the Company's 1999  Director
Long-Term  Incentive Plan, with 157,627,609 votes  for  the  proposal,
6,630,313 votes against the proposal and 864,775 abstentions and (iii)
a  proposal  to ratify and approve the appointment of Arthur  Andersen
LLP  as  independent public accountants for the Company for its fiscal
year  1999,  with  164,277,382 votes for the proposal,  487,332  votes
against the proposal and 357,985 abstentions.

Item 6.  Exhibits and Reports on Form 8-K

 (a)  Exhibits

     4.1  - Certificate  of  Designation  of  R&B  Falcon  Corporation
            filed  with  the  Secretary  of  State  of  the  State  of
            Delaware on April 22, 1999.  (Filed as  exhibit 4.3 to R&B
            Falcon Corporation's Registration Statement  on Form  S-4,
            registration number 333-81179 and incorporated  herein  by
            reference.)

     4.2  - Form of Registrant's 13-7/8% Senior Cumulative  Redeemable
            Preferred Stock Certificate.

     10.1 - Termination  Agreement  dated  as of  May 31, 1999 between
            Steven A. Webster and Registrant.

     10.2 - Termination  Agreement  dated  as  of May 31, 1999 between
            Robert F. Fulton and Registrant.

     10.3 - Termination  Agreement  dated as of June 30, 1999  between
            Leighton E. Moss and Registrant.

     10.4 - Termination  Agreement  dated as of July 31, 1999  between
            Douglas E. Swanson and Cliffs Drilling Company.

     15   - Letter  regarding unaudited interim financial information.

     27   - Financial  Data Schedule.  (Exhibit 27 is being  submitted
            as  an  exhibit  only  in  the  electronic format  of this
            Quarterly Report on  Form  10-Q  being  submitted  to  the
            Securities and Exchange Commission.)

 (b) Reports on Form 8-K

        R&B  Falcon filed four Current Reports on Form 8-K during  the
     three months ended June 30, 1999: (1) Report filed April 19, 1999
     announcing  the private placement of $300.0 million of  preferred
     stock;  (2) Report filed April 21, 1999 announcing that BP  Amoco
     canceled  its drilling contract with the Peregrine VII  and  that
     Petrobras  may  seek  to cancel its drilling  contract  with  the
     Falcon 100; (3) Report filed May 20, 1999 announcing a change  in
     auditors  for  Cliffs Drilling; (4) Report  filed  May  21,  1999
     announcing that Petrobras canceled its drilling contract with the
     Falcon 100.


                           SIGNATURE




Pursuant  to the requirements of the Securities Exchange  Act  of
1934, the registrant has duly caused this report to be signed  on
its behalf by the undersigned thereunto duly authorized.



                                      R&B FALCON CORPORATION



Date:  August 11, 1999                By /s/T. W. Nagle
                                         ----------------------
                                         T. W. Nagle
                                         Executive Vice
                                         President and
                                         Chief Financial Officer