EXHIBIT 10.166
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                                 CONTRACT

                                    FOR

                           CONSTRUCTION AND SALE

                                    OF

                    A 103,000 METRIC TONS DISPLACEMENT

                                 DRILLSHIP

                              (HULL NO. 1255)

                                  BETWEEN

                       READING & BATES DRILLING CO.

                                    AND

                    SAMSUNG HEAVY INDUSTRIES CO., LTD.

                                    AND

                            SAMSUNG CORPORATION

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                                   INDEX

PREAMBLE

ARTICLE I - DESCRIPTION AND CLASS

1.   Description .......................................
2.   Dimensions and Characteristics ....................
3.   Classification, Rules and Regulations .............
4.   Registration ......................................
5.   Specifications of Drillship .......................

ARTICLE II - CONTRACT PRICE AND TERMS OF PAYMENT

1.   Contract Price ....................................
2.   Adjustment of Contract Price ......................
3.   Currency ..........................................
4.   Terms of Payment ..................................
5.   Method of Payment .................................
6.   Notice of Payment before Delivery .................
7.   Expenses ..........................................
8.   Prepayment ........................................

ARTICLE III - ADJUSTMENT OF CONTRACT PRICE

1.   Delivery ..........................................
2.   Speed .............................................
3.   Fuel Consumption for the Diesel
     Generator Prime Drivers ...........................
4.   Capacity of Extended Well Test Tanks ..............
5.   Displacement ......................................
6.   Effect of Rescission ..............................

ARTICLE IV - APPROVAL OF PLANS AND DRAWINGS AND INSPECTION
             DURING CONSTRUCTION

1.   Approval of Plans and Drawings ....................
2.   Appointment of BUYER's Supervisor .................
3.   Inspection by the Supervisor ......................
4.   Facilities ........................................
5.   Liability of BUILDER ..............................
6.   Responsibility of BUYER ...........................
7.   Delivery and Construction Schedule.................
8.   Responsibility of BUILDER .........................

ARTICLE V - MODIFICATIONS, CHANGES AND EXTRAS

1.   How Effected ......................................
2.   Change in Rules of Classification Society,
     Regulations, etc. .................................
3.   Substitution of Materials .........................

ARTICLE VI - TRIALS AND ACCEPTANCE

1.   Notice ............................................
2.   Weather Condition .................................
3.   How Conducted .....................................
4.   Method of Acceptance or Rejection .................
5.   Effect of Acceptance ..............................
6.   Disposition of Surplus Consumable Stores ..........

ARTICLE VII - DELIVERY

1.   Time and Place ....................................
2.   When and How Effected .............................
3.   Documents to be Delivered to BUYER ................
4.   Tender of DRILLSHIP ...............................
5.   Title and Risk ....................................
6.   Removal of DRILLSHIP ..............................

ARTICLE VIII - DELAYS AND EXTENSION OF TIME FOR DELIVERY
               (FORCE MAJEURE)

1.   Causes of Delay (Force Majeure) ...................
2.   Notice of Delay ...................................
3.   Definition of Permissible Delay ...................
4.   Right to Rescind for Excessive Delay ..............

ARTICLE IX - WARRANTY OF QUALITY

1.   Guarantee .........................................
2.   Notice of Defects .................................
3.   Remedy of Defects .................................
4.   Extent of BUILDER's Responsibility ................
5.   Guarantee Engineer ................................

ARTICLE X - RESCISSION BY BUYER

1.   Notice ............................................
2.   Refundment by BUILDER .............................
3.   Discharge of Obligations ..........................

ARTICLE XI - BUYER'S DEFAULT

1.   Definition of Default .............................
2.   Effect of Default on or before Delivery of
       DRILLSHIP .......................................
3.   Disposal of DRILLSHIP .............................
4.   Dispute............................................

ARTICLE XII - ARBITRATION

1.   Decision by Classification Society ................
2.   Proceedings of Arbitration ........................
3.   Notice of Award ...................................
4.   Expenses ..........................................
5.   Entry in Court ....................................
6.   Alteration of Delivery Date .......................

ARTICLE XIII - SUCCESSOR AND ASSIGNS ....................

ARTICLE XIV - TAXES AND DUTIES

1.   Taxes and Duties Incurred in Korea ................
2.   Taxes and Duties Incurred Outside Korea ...........

ARTICLE XV - PATENTS, TRADEMARKS, COPYRIGHTS, ETC.

1.   Patents ...........................................
2.   General Plans, Specifications and Working
     Drawings ..........................................
3.   Exceptions ........................................

ARTICLE XVI - BUYER'S SUPPLIES

1.   Responsibility of BUYER ...........................
2.   Responsibility of BUILDER .........................
3.   Title..............................................
4.   BUYER's Supplies Refundment .......................

ARTICLE XVII - INSURANCE

1.   Extent of Insurance Coverage ......................
2.   Application of the Recovered Amounts ..............
3.   Termination of BUILDER's Obligation to Insure .....

ARTICLE XVIII - NOTICE

1.   Address ...........................................
2.   Language ..........................................
3.   Effective Date of Notice ..........................

ARTICLE XIX - EFFECTIVE DATE OF CONTRACT ...............

ARTICLE XX - INTERPRETATION

1.   Laws Applicable ...................................
2.   Discrepancies .....................................
3.   Entire Agreement ..................................
4.   Amendments and Supplements ........................

ARTICLE XXI - CONFIDENTIALITY ..........................

END OF CONTRACT ........................................

EXHIBIT "A" LETTER OF REFUNDMENT GUARANTEE .............

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      THIS  CONTRACT, made and entered into on this 5th day  of  September,
1997  by  and between READING & BATES DRILLING CO., a corporation  existing
under  the  laws  of  Oklahoma, and having an office at  901  Threadneedle,
Houston, Texas 77079-2902(hereinafter called the "BUYER"), on the one  part
and  SAMSUNG CORPORATION, a corporation incorporated and existing under the
laws  of the Republic of Korea, having its registered office at 250,  2-ka,
Taepyung-ro,  Chung-ku,  Seoul, Korea, and SAMSUNG  HEAVY  INDUSTRIES  CO.,
LTD.,  a  corporation  incorporated and existing  under  the  laws  of  the
Republic  of  Korea of having its registered office at 890-25  Daechi-Dong,
Kangnam-Ku, Seoul, Korea(hereinafter collectively called the "BUILDER"), on
the other part.

                              W I T N E S S E T H:

     In consideration of the mutual covenants herein contained, the BUILDER
agrees to build One (1) Drillship composed of hull part as described in the
specification  attached hereto as Exhibit 1 of this  Contract  (hereinafter
referred  to  as  the  "VESSEL")  and topside  part  as  described  in  the
specification  attached hereto as Exhibit 2 of this  Contract  (hereinafter
referred  to  as  "TOPSIDE")  (the VESSEL  and  TOPSIDE  being  hereinafter
collectively referred to as the "DRILLSHIP") and in accordance with (i) the
BUILDER's Approved Vendor List attached hereto as Exhibit 3, and  (ii)  the
Delivery  and  Construction Schedule attached hereto  as  Exhibit  4  (said
Exhibits   1   through   4  being  hereinafter  collectively   called   the
"Specifications")   which   Specifications   have   been    initialed    by
representatives  of  the  parties  hereto  for  identification  and   which
Specifications hereby are each incorporated herein by reference hereto  and
made  an  integral part of this Contract, at the BUILDER's shipyard located
in  Koje Island, Korea (hereinafter referred to as the "Shipyard")  and  to
deliver  and  sell  the same to the BUYER, and the BUYER hereby  agrees  to
purchase  and accept delivery of the DRILLSHIP from the BUILDER,  upon  the
terms and conditions hereinafter set forth.

                     ARTICLE I - DESCRIPTION AND CLASS

1.   Description:

           The  DRILLSHIP,  having the BUILDER's Hull No.  1255,  shall  be
     constructed, equipped and completed in accordance with the  provisions
     of  this  Contract,  and the Specifications (as  heretofore  defined),
     which  Specifications  are  an  integral  part  of  this  Contract  as
     heretofore provided.

2.   Dimensions and Characteristics:

     Length, overall                    Max. 221.5 meters
     Length, between perpendiculars     abt. 213.0 meters
     Breadth, moulded                   abt. 42.0 meters
     Depth, moulded                abt. 20.0 meters
     Scantling draft, moulded      abt. 13.0 meters
     The Generator Prime Driver will be manufactured by Wartsila at their
facility in Finland.
     Thruster Motor:                    4 MW with 77 tons thrust
                                        and 3.8 meter diameter

     Displacement, guaranteed:          103,000 metric tons at the
scantling
                                        draft, moulded, of 13.0 meters.

      Speed, guaranteed: The trial speed shall not be less than 12.0  knots
on  the  transit  draught  of  8.5  meters and at propulsion shaft power of
20,870 KW

     Fuel Consumption, guaranteed, Diesel Generator Prime Drivers:
          183.8g/k  Wh  with  engine driven pumps  at  manufacturer's  shop
          trial,  with  burning  of  the marine  diesel  having  the  lower
          calorific  value of 42,700kJ/Kg, at 85% MCR of engine  under  the
          environment  condition  of  ISO  3046/1-1986  specified  in   the
          Specifications.

     Cargo tank capacity, guaranteed:
          The  total  capacity  of  the Extended Well  Test  ("EWT")  tanks
          including slop tanks will not be less than 15,500 cubic meters at
          the full levels (100% volume) of EWT tanks.

          The  details  of the aforementioned particulars, as well  as  the
          definitions  and  the  methods of measurements  and  calculations
          shall be as indicated in the Specifications.

3.   The Classification, Rules and Regulations:

          The DRILLSHIP, including its machinery, equipment and outfittings
     shall  be constructed and classified in accordance with the rules  and
     regulations (the editions and amendments thereto being in force as  of
     the  signing date of this Contract) of and under special survey of the
     American  Bureau  of Shipping (hereinafter called the  "Classification
     Society"), and shall be distinguished in the register by the symbol of
     +A1  E,  "Ship Type Drilling Unit", FSO where applicable, +AMS, +ACCU,
     +DPS-3, DLA.

           Decisions of the Classification Society as to compliance or non-
     compliance  with  the  classification rules and regulations  shall  be
     final and binding upon both parties hereto.  Details of Class notation
     shall be in accordance with the Specifications.

           The DRILLSHIP shall also comply with the rules, regulations  and
     requirements of the regulatory bodies as described and listed  in  the
     Specifications.

     The  DRILLSHIP will be built and delivered (i) in accordance with  the
     terms of this Contract and the Specifications, (ii) in full compliance
     and certification to and with the IMO MODU code with amendments, (iii)
     in  full compliance with the regulations, provisions, and requirements
     included  in  the  Specifications, (iv) in full  compliance  with  the
     requirements  of the classification Society so as to be  classed  with
     the  Classification  Society  as  a MODU/FSO,  and  (v)  so  that  the
     DRILLSHIP  will  be approved to operate in the United States  Gulf  of
     Mexico/the Outer Continental Shelf of the United States. BUILDER  will
     take  all  action necessary, and remedy at its cost and  expense,  any
     deficiency  which  constitutes a failure  to  comply  with  the  above
     requirements.

          All the fees and charges incidental to the Classification Society
     and   in   respect  to  compliance  with  the  above  referred  rules,
     regulations  and  requirements, as well as all DRILLSHIP  design  fees
     and/or  royalties  (except any royalties for  the  BUYER's  Supplies),
     shall be for account of the BUILDER.

           BUILDER  shall  be responsible for obtaining the  Classification
     Society's  approval  of  all  required  plans  and  drawings  of   the
     DRILLSHIP.

4.   Registration:

           The DRILLSHIP, at the time of its delivery and acceptance, shall
     be  registered  at  the  port  of registry  by  the  BUYER  under  the
     Panamanian flag at the BUYER's expense.

5.   Specifications of Drillship:

     The Contract Price set out in Article II, Paragraph 1, is based on the
     Specifications of the DRILLSHIP being the same as the "Specifications"
     identified in the shipbuilding contract for Hull No. 1220 as in effect
     on  October  31,  1996   (the  "Hull 1220 Specifications")  with  such
     changes  as may be appropriate to reflect different delivery schedules
     for  BUYER's  Supplies, vendor data, and the Delivery and Construction
     Schedule  of the Drillship.  Any extras or change orders made  to  the
     specifications of the BUILDER's hull no.1220 after the date of October
     31,  1996,  shall  not  be  included in  the  specifications  for  the
     DRILLSHIP but the BUYER shall be entitled to request the same pursuant
     to the shipbuilding contract for the drillships of BUILDER's hull no.s
     1220 and/or 1231. In such     case, Article V hereof shall be applied.
     Any  adjustments  to the Contract Price based on any  changes  to  the
     Specifications  as agreed by BUYER shall be handled as  changes  under
     this  Contract and any adjustments to the Contract Price will be  made
     at the time of the payment of the Sixth Installment.

                                                       (End of Article)

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             ARTICLE II - CONTRACT PRICE AND TERMS OF PAYMENT

1.   Contract Price:

           The  purchase  price  of the DRILLSHIP, net  receivable  by  the
     BUILDER and exclusive of the BUYER's Supplies (as defined in Paragraph
     1  of  Article  XVI hereof) is One Hundred Forty-Eight  Million  Seven
     Hundred  Eighty  Five  Thousand Eight Hundred  United  States  Dollars
     (US$148,785,800)  (hereinafter referred to as the  "Contract  Price").
     The  Contract Price shall be subject to upward or downward adjustment,
     if any, as hereinafter set forth in this Contract.

           Pricing  for  all change orders for the DRILLSHIP  identical  to
     change orders submitted by the buyers of the BUILDER's hull no.s  1220
     and/or  1231 for the construction of the drillships, shall not include
     a  provision  for  the  payment  of design  and  engineering  services
     previously  performed  by the BUILDER and the buyer's  behalf  of  the
     BUILDER's hull no.s 1220 and/or 1231 contract(s).

2.   Adjustment of Contract Price:

           Increase  or  decrease of the Contract Price,  if  any,  due  to
     adjustments  thereof made in accordance with the  provisions  of  this
     Contract  shall be adjusted by way of addition to or subtraction  from
     the  Contract  Price upon delivery of the DRILLSHIP in the  manner  as
     hereinafter provided.

3.   Currency:

           Any  and all payments by the BUYER to the BUILDER, or vice versa
     if  any  which  are due under this Contract shall be  made  in  United
     States Dollars.

4.   Terms of Payment:

           The Contract Price shall be due and payable by the BUYER to  the
BUILDER in the installments as follows:

     (a)  First Installment:
          The  First  Installment  amounting to  Thirty-Seven  Million  One
          Hundred  Ninety  Six  Thousand Four Hundred Fifty  United  States
          Dollars  (25%,  US$37,196,450) shall be due  and  payable  within
          three  (3)  banking  days    after execution  of  this  Contract,
          provided  that the Letter of Refundment Guarantee required  under
          Article X has been received by the BUYER or its designee  of  the
          refund guarantee to be issued by a Korean bank.

     (b)  Second Installment:
          The  Second  Installment  amounting to Thirty-Seven  Million  One
          Hundred  Ninety  Six  Thousand Four Hundred Fifty  United  States
          Dollars (25%, US$37,196,450) shall be due and payable upon  March
          4, 1998.

     (c)  Third Installment:
          The Third Installment amounting to Fourteen Million Eight Hundred
          Seventy  Eight  Thousand Five Hundred and  Eighty  United  States
          Dollars  (10%,  US$14,878,580) shall  be  due  and  payable  upon
          November 12, 1998.

     (d)  Fourth Installment:
          The  Fourth  Installment  amounting  to  Fourteen  Million  Eight
          Hundred  Seventy  Eight Thousand Five Hundred and  Eighty  United
          States Dollars (10%, US$14,878,580) shall be due and payable upon
          January 24, 1999.

     (e)  Fifth Installment:
          The Fifth Installment amounting to Fourteen Million Eight Hundred
          Seventy  Eight  Thousand Five Hundred and  Eighty  United  States
          Dollars  (10%, US$14,878,580) shall be due and payable upon  June
          6, 1999.

     (f)  Sixth Installment:
          The  Sixth  Installment amounting to Twenty  Nine  Million  Seven
          Hundred Fifty Seven Thousand One Hundred and Sixty United  States
          Dollars  (20%,US$29,757,160)  plus  any  increase  or  minus  any
          decrease  due  to  adjustment of the  Contract  Price  under  and
          pursuant  to the provisions of this Contract, shall  be  due  and
          payable  upon  delivery  of  the DRILLSHIP  or  upon  tender  for
          delivery  of the DRILLSHIP referred to in Paragraph 4 of  Article
          VII of this Contract.

5.   Method of Payment:

     (a)  First Installment:
          Within three (3) banking days after the date of execution of this
          Contract, the BUYER shall remit by telegraphic transfer the first
          first installment to the account of     The Export/Import Bank of
          Korea,  Head  Office,  Seoul, Korea (Account No.  04-029-695,Head
          Office  with  Bankers Trust Company, New York) or  to  the  banks
          which  the BUILDER may designate (hereinafter referred to as  the
          "BUILDER's BANK") in favour of Samsung Heavy Industries Co., Ltd.

     (b)  Second, Third, Fourth and Fifth Installments:
          Upon  the  due date of the second, third and fourth installments,
          in  accordance  with  Article II, 4 (b),  (c),  (d)  and  (e)  as
          appropriate,  the BUYER shall remit by telegraphic transfer  each
          of  the  respective installments to the account at the  BUILDER's
          BANK in favor of Samsung Heavy Industries Co., Ltd.

     (c)  Sixth Installment:
          At  the  time of delivery of the Vessel to the Buyer pursuant  to
          Section 2 of Article VII of this Contract, the BUYER shall  remit
          by  telegraphic transfer the fifth installment to the account  at
          the  BUILDER's  BANK in favour of Samsung Heavy  Industries  Co.,
          Ltd.  with an irrevocable instruction that the amount so remitted
          shall  be  payable  to  the BUILDER against presentation  by  the
          BUILDER  to the BUILDER's BANK of a copy of PROTOCOL OF  DELIVERY
          and  ACCEPTANCE OF THE DRILLSHIP executed by the  BUYER  and  the
          BUILDER.

          No payment due under this Contract shall be delayed, suspended or
          withheld  by  the BUYER on account of any dispute or disagreement
          between  the parties hereto.  Any claim which the BUYER may  have
          against  the  BUILDER hereunder shall be settled  and  liquidated
          separately  from  any  payment  by  the  BUYER  to  the   BUILDER
          hereunder.

6.   Notice of Payment before Delivery:

     With  the  exception of the first installment, the BUILDER shall  give
     the  BUYER  Ten  (10) banking days prior notice in  writing  or  telex
     confirmed  in writing by registered mail of the anticipated  due  date
     and  amount  of  each  installment  payable  before  delivery  of  the
     DRILLSHIP.

7.   Expenses:

     Expenses and bank charges for remitting payments and any taxes  (other
     than  taxes  on income imposed on the BUILDER), duties,  expenses  and
     fees applicable to remitting such payment shall be for account of  the
     BUYER.

8.   Prepayment:

     The  BUYER  may prepay any or all of the installments of the  Contract
     Price, provided that the BUYER declares the BUYER's intention to do so
     in  writing  or by telex confirmed in writing stating in  advance  the
     intended date of such prepayment, subject to the BUILDER's acceptance,
     which shall not be unreasonably withheld.
                                                           (End of Article)

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                ARTICLE III - ADJUSTMENT OF CONTRACT PRICE

      The Contract Price shall be subject to adjustment, as hereinafter set
forth, in the event of the following contingencies (it being understood  by
both  parties  that  any  reduction of the Contract  Price  is  by  way  of
liquidated damages and not by way of penalty):

1.   Delivery:

          (a)   No  adjustment shall be made and the Contract  Price  shall
          remain  unchanged  for the first Thirty (30)  days  of  delay  in
          delivery of the DRILLSHIP beyond the Delivery Date as defined  in
          Article VII hereof (ending as of twelve o'clock midnight  of  the
          Thirtieth (30th) day of delay).

          (b)  If the delivery of the DRILLSHIP is delayed more than Thirty
          (30) days after the Delivery Date, then, in such event, beginning
          at  twelve o'clock midnight of the Thirtieth (30th) day after the
          Delivery Date, the Contract Price shall be reduced by the sum  of
          Ten  Thousand  United Dollars (US$10,000) for each full  day  for
          which thereafter delivery is delayed.

          However,  the total reduction in the Contract Price  pursuant  to
          this  Paragraph (b) shall not be more than as would be  the  case
          for  a  delay of One Hundred Fifty (150) days counting from  mid-
          night of the Thirtieth (30th) day after the delivery date at  the
          above specified rate of reduction.

          (c)   However,  if the delay in delivery of the DRILLSHIP  should
          continue  for a period of One Hundred Eighty (180) days from  the
          Delivery Date in Paragraph 1 of Article VII, then in such  event,
          and  after such period has expired, the BUYER may, at its option,
          rescind  this  Contract  in accordance  with  the  provisions  of
          Article X hereof.

                The  BUILDER may, at any time after the expiration  of  the
          aforementioned  One  Hundred  Eighty  (180)  days  of  delay   in
          delivery,  if  the BUYER has not served notice of  rescission  as
          provided  in Article X hereof, demand in writing that  the  BUYER
          shall  make  an  election, in which case the BUYER shall,  within
          Twenty  (20)  days after such demand is received  by  the  BUYER,
          notify  the  BUILDER  of  its intention either  to  rescind  this
          Contract  or to consent to the acceptance of the DRILLSHIP  at  a
          specified future date which date BUILDER represents to  BUYER  is
          the  earliest  date  BUILDER can deliver the DRILLSHIP  to  BUYER
          under  this Contract, based on the circumstances then known.   If
          the  BUYER shall not make an election within Twenty (20) days  as
          provided  hereinabove, the BUYER shall be deemed to have accepted
          such  extension of the delivery date to the future delivery  date
          indicated  by the BUILDER and it being understood by the  parties
          hereto  that if the DRILLSHIP is not delivered by such  specified
          date, the BUYER shall have the same right of rescission upon  the
          same terms and conditions as hereinabove provided.

          (d)   If  the delivery of the DRILLSHIP is made more than  thirty
          (30)  days  earlier than the Delivery Date, then, in such  event,
          beginning  with the thirty-first (31) day prior to  the  Delivery
          Date,  the Contract Price of the DRILLSHIP shall be increased  by
          adding thereto Ten Thousand United States Dollars US$10,000)  for
          each  full day. However, the total increase in the Contract Price
          pursuant to this Paragraph (d) shall not be more than as would be
          the  case for an early delivery of Sixty (60) days counting  from
          the Thirty-first (31) day prior to the Delivery Date at the above
          specified rate of increase.

          (e)   For  the  purpose  of this Article,  the  delivery  of  the
          DRILLSHIP  shall  be  deemed  to  be  delayed  when  and  if  the
          DRILLSHIP,  after  taking into account all postponements  of  the
          Delivery  Date  by  reason of permissible  delay  as  defined  in
          Article VIII and/or any other reason under this Contract, is  not
          delivered  by the date upon which delivery is required under  the
          terms of this Contract.

2.   Speed:

          (a)   The  Contract  Price  shall not be affected  or  changed by
          reason of the trial speed (as determined according to the
          Specifications) being more or less than the guaranteed speed,  if
          such variation is not more than two (2) knots.

          (b)  If the  deficiency in the speed upon final sea trial is more
          than Two  (2) knots below  the guaranteed speed of the DRILLSHIP,
          then  the  BUYER  may,  at its  option,  reject the DRILLSHIP and
          rescind  this  Contract  in   accordance  with the provisions  of
          Article X hereof, or may  accept the  DRILLSHIP  at  a  reduction
          in the  Contract  Price  to  be agreed, provided that  the  price
          reduction shall not  be  less  than  Two  Hundred Thousand United
          States Dollars.(US$200,000)

3.   Fuel Consumption for the Diesel Generator Prime Drivers:

          (a)   The Contract Price shall not be affected or changed in case
          the  actual fuel consumption, as determined by the shop trial  as
          specified  in the Specifications, is not more than Three  percent
          (3%)  in  excess of the guaranteed fuel consumption specified  in
          Paragraph 2 of Article I.

          (b)   However,  in the event that the actual fuel consumption  at
          the  shop trial is in excess of Three (3%) of the guaranteed fuel
          consumption, the Contract Price shall be reduced by  the  sum  of
          Ten  Thousand  United States Dollars (US$10,000)  for  each  full
          gramme per metric bhp per hour in excess of the Three percent(3%)
          (but disregarding fractions of One (1) gramme) of the  guaranteed
          fuel consumption.

          (c)   BUYER has an option to reject the DRILLSHIP and rescind the
          Contract in accordance with the provisions of Article X hereof in
          the  event  the actual fuel consumption is more than Ten  percent
          (10%) in excess of the guaranteed fuel consumption.

4.   Capacity of Extended Well Test Tanks

          (a)   In  the event the capacity of the Extended Well Test tanks,
          including  slop tanks, ("EWT tanks") as determined in  accordance
          with the Specifications is 14,310 cubic meters or less, then  the
          BUYER  may,  at its option, (i) reject the DRILLSHIP and  rescind
          this  Contract  in accordance with the provisions  of  Article  X
          hereof, or (ii) accept the DRILLSHIP with such deficiency.

          (b)   There will be no increase or decrease of the Contract Price
          in  the event the capacity of the EWT tanks is more than or  less
          than  the  guaranteed capacity of the EWT tanks as  specified  in
          Paragraph  2  of Article I, but BUYER shall have  the  option  of
          rescission as provided for in Subparagraph (a) of this  paragraph
          4 of Article III.

5.   Displacement:

          (a)   The  guaranteed  displacement of the DRILLSHIP  is  103,000
          metric tons at 13.0 meters.

          (b)   In the event of a discrepancy (whether higher or lower)  in
          the  actual  displacement of the DRILLSHIP being  three  thousand
          five hundred (3,500) metric tons or more, then, the BUYER may, at
          its  option,  reject the DRILLSHIP and rescind this  Contract  in
          accordance with the provisions of Article X hereof or accept  the
          DRILLSHIP  at  a reduction in the Contract Price of  Six  Hundred
          thousand United States Dollars (US$600,000).

6.   Effect of Rescission:

     It is expressly understood and agreed by the parties that in any case,
     if  the  BUYER  rescinds this Contract under this Article,  the  BUYER
     shall not be entitled to any liquidated damages, or any other recourse
     unless by means of the provisions of Article X hereof.

                                                       (End of Article)

                    -----------------------------------

                    ARTICLE IV - APPROVAL OF PLANS AND
                DRAWINGS AND INSPECTION DURING CONSTRUCTION

1.   Approval of Plans and Drawings:

     It  is  agreed by the parties that the BUILDER shall apply and use  as
     its  basis  for  construction  of the  DRILLSHIP's  drawings  for  the
     BUILDER's hull no. 1220 and/or 1231 previously approved by the  buyers
     of  the  BUILDER's hull no. 1220 and/or 1231 which shall be deemed  to
     have  been  approved by the BUYER for the DRILLSHIP except  for  those
     drawings  which  may  require alteration  for  new  approvals  by  the
     Classification Society and/or the statutory bodies in connection  with
     change   of   the   rules  and  regulations  and/or  the   DRILLSHIP's
     registration  by the BUYER.  Such drawings required for new  approvals
     shall  be  submitted  by  the BUILDER to the  BUYER  for  the  BUYER's
     reference  upon  obtaining the approvals.  Notwithstanding  the  above
     BUILDER  will  supply  to  the  BUYER  a  complete  set  of  as  built
     drawings/documents with Hull No. 1255 so indicated thereon.

2.   Appointment of BUYER's Supervisor:

     The BUYER may send to and maintain at the Shipyard, at the BUYER's own
     cost and expense, one supervisor (herein called the "Supervisor")  who
     shall  be duly authorized in writing by the BUYER, which authorization
     shall  be  described in a separate letter to be sent  to  the  BUILDER
     prior  to  the Supervisor's arrival, to act on behalf of the BUYER  in
     connection  with the modifications of the Specifications,  adjustments
     of  the  Contract Price and Delivery Date in writing, approval of  the
     plans  and drawings, attendance to the tests and inspections  relating
     to  the  DRILLSHIP, its machinery, equipment and outfittings, and  any
     other  matters for which he is specifically authorized by  the  BUYER.
     The  Supervisor may appoint assistant(s) to attend at the Shipyard for
     the purposes as aforesaid.

3.   Inspection by the Supervisor:

     The  necessary inspections of the DRILLSHIP, its machinery,  equipment
     and  outfittings  shall be carried out by the Classification  Society,
     other  regulatory bodies and/or the Supervisor throughout  the  entire
     period of construction in order to ensure that the construction of the
     DRILLSHIP  is  duly  performed in accordance with the  Specifications.
     The  Supervisor shall have, during construction of the DRILLSHIP,  the
     right  to  attend  such tests and inspections of  the  DRILLSHIP,  its
     machinery  and equipment within the premises of either the BUILDER  or
     its  subcontractors.  Detailed procedures of the  inspection  and  the
     tests thereof shall be in accordance with Specifications.

     The  Supervisor  shall, within the limits of the  authority  conferred
     upon him by the BUYER, make decisions or give advice to the BUILDER on
     behalf  of  the BUYER promptly on all problems arising out of,  or  in
     connection  with, the construction of the DRILLSHIP and generally  act
     in  a  reasonable manner with a view to cooperating to the utmost with
     the BUILDER in the construction process of the DRILLSHIP.

     The  decision, approval or advice of the Supervisor within the  limits
     of  authority conferred on the Supervisor by the BUYER shall be deemed
     to  have been given by the BUYER.  The BUYER's Supervisor shall notify
     the  BUILDER  promptly in writing of his discovery of any construction
     or  materials,  which he believes do not or will not  conform  to  the
     requirements  of  the  Contract  or the  Specifications  and  likewise
     advise  and consult with the BUILDER on all matters pertaining to  the
     construction of the DRILLSHIP, as may be required by the  BUILDER,  or
     as he may deem necessary.

     However, if the Supervisor fails to submit to the BUILDER promptly any
     such  demand  concerning alterations or changes with  respect  to  the
     construction,  arrangement  or  outfit  of  the  DRILLSHIP  which  the
     Supervisor  has  examined, inspected or attended at the  test  thereof
     under  this  Contract or the Specifications, the Supervisor  shall  be
     deemed to have approved the same and    shall be precluded from making
     any  demand  for  alterations, changes,  or  complaints  with  respect
     thereto at a later date.

     The   BUILDER  shall  comply  with  any  such  demand  which  is   not
     contradictory  to this Contract or the Specifications,  provided  that
     any   and   all  such  demands  by  the  Supervisor  with  regard   to
     construction,  arrangement  and  outfit  of  the  DRILLSHIP  shall  be
     submitted  in  writing  to  the authorized  representative  of     the
     BUILDER.  The BUILDER shall notify the Supervisor of the names of  the
     persons  who are from time to time authorized by the BUILDER for  this
     purpose.

     It  is  agreed  upon  between  the BUYER  and  the  BUILDER  that  the
     modifications, alterations or changes and other measures necessary  to
     comply with such demand may be effected at a convenient time and place
     at  the  BUILDER's  reasonable discretion in view of the  construction
     schedule of the vessel.

     In  the event that the Supervisor shall advise the BUILDER that he has
     discovered and believes the construction or materials do not  or  will
     not   conform   to   the  requirements  of  this   Contract   or   the
     Specifications, and the BUILDER shall not agree with the views of  the
     Supervisor in such respect, either the BUYER or the BUILDER may either
     seek   an  opinion  of  the  Classification  Society  or  request   an
     arbitration  in accordance with the provisions of Article XII  hereof.
     The  Classification Society or the Arbitration Board  shall  determine
     whether  or  not a nonconformity with the provisions of this  Contract
     and  the Specifications exist.  If the Classification Society  or  the
     Arbitration Board enters a determination in favour of the BUYER,  then
     in  such  case  the  BUILDER shall make the necessary  alterations  or
     changes, or if such alterations or changes cannot be made in  time  to
     meet  the  construction schedule for the DRILLSHIP the  BUILDER  shall
     make  fair and reasonable adjustment of the Contract Price in lieu  of
     such  alterations and changes.  If the Classification Society  or  the
     Arbitration  Board enters a determination in favour  of  the  BUILDER,
     then  the time for delivery of the DRILLSHIP shall be extended  for  a
     period   of  delay  in  construction,  if  any,  occasioned  by   such
     proceedings, and the BUYER shall compensate the BUILDER for the proven
     loss and damages (always excluding consequential damages) incurred  to
     the BUILDER as a result of the dispute herein referred to.

     BUYER's Supervisor, at his discretion, may refuse to inspect or attend
     tests where adequate safety measures have not been implemented and  in
     such event such tests/inspections shall not be deemed complete.

4.   Facilities:

          (a)    The   BUILDER  shall  furnish  the  Supervisor   and   his
          assistant(s)  with    adequate  office  space  and   such   other
          reasonable facilities according to the BUILDER's practice  at  or
          in  the immediate vicinity of the Shipyard as may be necessary to
          enable  them  to effectively carry out their duties.   The  BUYER
          shall pay for all such facilities other than office space at  the
          BUILDER's  normal rate of charge. BUILDER shall advise  BUYER  in
          advance of BUILDER's normal rate of charge for any facilities for
          which BUYER will be required to pay.

          (b)   The  BUILDER shall make available for BUYER's personnel  at
          the  BUYER's  request,  during  the DRILLSHIP's  construction,  a
          minimum  of 8 two or three bedroom apartments furnished with  the
          BUILDER's   standard   furniture,   electrical   facilities   and
          utilities.   If BUYER requests BUILDER to provide the BUYER  with
          special  furniture and facilities beyond the BUILDER's  standard,
          any additional costs which may result therefrom, if any, will  be
          borne  by  BUYER.   Costs for such housing, on a  monthly  rental
          basis,  will be presented to BUYER prior to occupation and  shall
          be  reimbursed by BUYER, along with metered utility and telephone
          charges.  The BUILDER will use best efforts to furnish additional
          apartments requested by the BUYER.

5.   Liability of BUILDER:

          The  BUILDER agrees to fully protect, defend, indemnify and  hold
       BUYER  harmless  from  and  against  all  liabilities,  obligations,
       claims  or  actions  for personal injury or  death  arising  out  of
       performance  by  BUILDER  or  BUYER of their  obligations  hereunder
       prior  to the acceptance by BUYER of the DRILLSHIP, and asserted  by
       or on behalf of,
         (i)    any   employee,  agent,  contractor,   or
                subcontractor of BUILDER,                     or
        (ii)    any employee of any agent, contractor, or subcontractor  of
                BUILDER,
       regardless  of the basis of such claims and even if  such  claims
       should  arise  out of the sole or concurrent fault or negligence  of
       BUYER,  or  any  employee,  agent, contractor  or  subcontractor  of
       BUYER.

          Similarly,  the BUYER agrees to fully protect, defend,  indemnify
       and   hold  BUILDER  harmless  from  and  against  all  liabilities,
       obligations, claims or actions for personal injury or death  arising
       out  of  performance  by  BUILDER  or  BUYER  of  their  obligations
       hereunder  prior  to the acceptance by BUYER of the  DRILLSHIP,  and
       asserted by or on behalf of,
           (i)  any employee, agent, contractor, or subcontractor of BUYER,
                or
           (ii) any employee of any agent, contractor, or subcontractor  of
                BUYER,
     regardless of the basis of such claims and even if such claims  should
     arise out of the sole or concurrent fault or negligence of BUILDER, or
     any employee, agent or subcontractor of BUILDER.

6.   Responsibility of BUYER:

           The  BUYER shall undertake and assure that the Supervisor  shall
     carry   out  his  duties  hereunder  in  accordance  with  the  normal
     shipbuilding  practice  of the BUILDER, which BUILDER  represents  and
     confirms  is  in  all  material  respects  in  accordance  with   good
     international shipbuilding practice and in such a way so as  to  avoid
     any  unnecessary increase in building cost, delay in the  construction
     of  the DRILLSHIP, and/or any disturbance in the construction schedule
     of  the  BUILDER.  The BUILDER has the right to request the  BUYER  to
     replace the Supervisor who is deemed unsuitable and unsatisfactory for
     the proper progress of the DRILLSHIP's construction.

           The  BUYER  shall  investigate  the  situation  by  sending  its
     representative(s)  to  the Shipyard if necessary,  and  if  the  BUYER
     considers  that such BUILDER's request is justified, the  BUYER  shall
     effect such replacement as soon as conveniently arrangeable.

7.   Delivery and Construction Schedule:

           Attached  hereto  as  Exhibit  4 is  a  tentative  Delivery  and
     Construction Schedule, and within Sixty (60) days after  the  date  of
     this Contract, BUILDER shall deliver or cause to be delivered to BUYER
     a  final  Delivery and Construction Schedule (herein, as from time  to
     time  amended  with  the  knowledge  of  BUYER,  referred  to  as  the
     "Schedule"),  prepared  in reasonable detail  and  setting  forth  the
     estimated time table for the construction of the DRILLSHIP,  it  being
     understood  that  the Schedule may be used by BUYER  for  purposes  of
     verifying  and measuring the progress being made under  the  terms  of
     this Contract.

8.   Responsibility of BUILDER:

          (a)   BUILDER  personnel and subcontractors which,  in  the  sole
          opinion  of  BUYER, are found to be in violation  of  the  safety
          policies  established  by  BUILDER or those  specially  in  place
          during the construction of the DRILLSHIP, may be requested to  be
          removed  from    the  project by the BUYER's Supervisor.  BUILDER
          will  immediately take such actions as necessary to  comply  with
          BUYER's request.

          (b)  The BUILDER is to assign a dedicated safety supervisor and a
          sufficient  number  of  safety inspectors  to  remain  in  effect
          throughout  the  Contract to monitor employee  and  subcontractor
          safety,   scaffolding  and  safety  netting,  tank  entry,   work
          permitting  procedures, electrical safety, etc.  Upon request  by
          the  BUYER,  the safety supervisor shall participate  in  BUYER's
          daily safety and quality meetings.

          (c)   The  BUILDER  shall  provide a 24 hour  fire-watch  at  the
          DRILLSHIP  construction site.  In addition, at various  locations
          around  the site, fire alarm stations will be situated whereby  a
          manual  alarm may be sounded and a local emergency response  team
          is notified and activated.

          (d)   BUILDER  shall  immediately report to BUYER  all  incidents
          and/or  accidents  involving  injury,  no  matter  the  level  of
          severity,  including first aid, loss of property, no  matter  the
          value,  as  well  as  any identified hazards and/or  near  misses
          occurring.

                Any  and  all reports of hazards, accidents, incidents,  or
          near  misses  will result in the immediate and  full  ceasing  of
          construction activities in the affected area until such  time  as
          adequate precautions have been implemented.

          (e)   BUILDER  hereby agrees that the cranes  and  other  related
          lifting gear of the DRILLSHIP will not be used by BUILDER  during
          construction, without the prior written approval of BUYER.
          BUIlDER  and  BUYER  recognize  that  the  lifting  gear  of  the
          DRILLSHIP  will  be used to install the BOP stack.   Should  such
          approval  be given, BUILDER shall make such cranes to  normal  in
          functional  respect of operation, including, but not  limited  to
          the changing of all wires.

          (f)   It  is agreed by BUILDER and BUYER that no more than twenty
          percent   (20%),   by  number,  of  all  blocks  fabricated   for
          construction of the VESSEL will be built outside of BUILDER's own
          yard.   In case more than twenty percent (20%) of all blocks  for
          the   VESSEL is required by the BUILDER to be fabricated  outside
          of  BUILDER's own yard, then the BUILDER shall obtain the BUYER's
          prior   written  consent.   Pursuant  to  the  above,  the   only
          facilities  to  be used other than BUILDER's are  the  Hanae  and
          Sungnae fabrication yards, provided however, funnel and/or casing
          may be fabricated at Oriental Fitting Co.

                It  is agreed that all TOPSIDE fabrication will be done  at
          BUILDER's facility.

          (g)   All  initial  spare parts for BUILDER Furnished  Equipment,
          including those necessary for shipyard start-up testing  and  for
          the  commissioning of equipment, shall be provided by BUILDER  at
          BUILDER's  cost.   Further,  BUILDER shall  provide  to  BUYER  a
          listing of all critical spare parts (any long lead item and those
          spares  causing  equipment  to be out  of  service  for  extended
          periods  of  time)  and  two  years operating  spare  parts.   In
          addition, BUILDER agrees to specifically identify on the  listing
          any  and all ABS required spare parts.  BUILDER will provide such
          spare parts listing to BUYER as soon as an order for equipment is
          placed,  but  in  no case later than 90 days prior  to  DRILLSHIP
          delivery.  The  BUYER  is  responsible  for  supplying  all   the
          equipment  and  material in accordance with the BUYER's  Supplies
          list  attached  hereto  including  the  spare/service  parts  and
          specialized  tools  and  initial  consumables  for  the   BUYER's
          Supplies.

          (h)   Attached  hereto as Exhibit 3 is BUILDER's approved  vendor
          list.  BUILDER  agrees  that  any material  and/or  supplies  not
          fabricated  by  the  BUILDER  will originate  from  a  vendor  so
          specified  in Exhibit 3.  The manufactures and specifications  of
          machinery and equipment for   the DRILLSHIP shall be the same  as
          the  BUILDER's hull no.1231, subject to a change(s) if agreed  by
          the  BUILDER and the BUYER. In the event procurement of  material
          and/or  supplies from the approved vendors are     not  available
          due  to  shortage  or  delay  in delivery  thereof  to  meet  the
          BUILDER's  overall  construction schedule of the  DRILLSHIP,  the
          BUILDER may mobilize and originate from other equivalent with the
          BUYER's consent, which shall not be unreasonably withheld.

          (i)  The BUILDER shall, on a monthly basis, provide BUYER with  a
          written progress report regarding the construction of the  VESSEL
          based on the BUILDER's standards in accordance with their ISO9001
          procedure.   Such report is to include a summary of the  progress
          to date as well as the progress since the previous report.  In  a
          form  and  frequency to be agreed, the BUILDER will  furnish  the
          BUYER  a  simple  written report updating the progress  on  major
          milestones  in  the production schedule.  Informal  oral  reports
          shall be furnished to the BUYER by the BUILDER upon request.

      In  addition,  BUILDER  shall  include  a  limited  number  of  color
photographs relevant to the fabrication process for the construction period
of  the  DRILLSHIP in the progress report.  Photographs are to  be  5  x  7
inches,  bound  in books with dates and descriptive captions.  As  soon  as
each volume is available, BUILDER shall furnish three (3) sets of books  of
photographs and one (1) set of negatives to the BUYER.

                                                       (End of Article)

                  ---------------------------------------

               ARTICLE V - MODIFICATIONS, CHANGES AND EXTRAS

1.   How Effected:

         The  Specifications  may  be modified and/or  changed  by  written
     request  of  the  BUYER subject to BUILDER's approval (which  approval
     shall   not   be   unreasonably  withheld)  and  provided   that   any
     modifications and/or changes requested by the BUYER or an accumulation
     of  such  modifications and/or changes will not adversely  affect  the
     BUILDER's  other  commitments  and the  BUYER  shall  first  agree  in
     writing, before such modifications and/or changes are carried out,  to
     any  adjustment  in  the  Contract Price, time  for  delivery  of  the
     DRILLSHIP  or  other  terms and conditions of  this  Contract  or  the
     Specifications  occasioned  by or resulting  from  such  modifications
     and/or  changes.  The BUILDER hereby agrees to exert its best  efforts
     to  accommodate such reasonable request by the BUYER so that the  said
     changes  and/or  modifications may be made at a  reasonable  cost  and
     within the shortest period of time which is reasonably possible.   Any
     such  agreement  for  modifications and/or changes  shall  include  an
     agreement  as  to  the increase or decrease, if any, in  the  Contract
     Price  of the DRILLSHIP together with an agreement as to any extension
     or reduction in the time of delivery, or any other alterations in this
     Contract or the Specifications occasioned by such modifications and/or
     changes.   The  aforementioned agreement to modify and/or  change  the
     Specifications may be effected by an exchange of letters signed by the
     authorized  representatives of the parties hereto, or telex  confirmed
     in  writing,  manifesting such agreement.  Such letters and  confirmed
     telex  exchanged by the parties hereto pursuant to the foregoing shall
     constitute  an amendment of the Specifications, and such  letters  and
     telex shall be incorporated into this Contract and made a part hereof.
     The  BUILDER  may make minor changes to the Specifications,  if  found
     necessary   for  introduction  of  improved  production   methods   or
     otherwise,  provided that the BUILDER shall first obtain  the  BUYER's
     written approval which shall not be unreasonably withheld.

2.   Changes in Rules of Classification Society, Regulations, etc.:

            If, after the date of signing this Contract, any requirements as
     to Classification Society, or as to the rules and regulations to which
     the  construction of the DRILLSHIP is required to conform, are altered
     or   changed  by  the  Classification  Society  or  regulatory  bodies
     authorized to make such alterations or changes, either of the  parties
     hereto,  upon  receipt  of information thereof,  shall  transmit  such
     information  in  full to the other party in writing, thereupon  within
     Twenty-One (21) days after receipt of the said notice from  the  other
     party,  the  BUYER  shall  instruct the BUILDER  in  writing  if  such
     alterations or changes shall be made in the DRILLSHIP or not,  in  the
     BUYER's sole discretion.

           The  BUILDER  shall  promptly comply with  such  alterations  or
     changes,  if any, in the construction of the DRILLSHIP, provided  that
     the BUYER shall first agree:

          (a)   To  any increase or decrease in the Contract Price  of  the
          DRILLSHIP  that  is reasonably occasioned by  the  cost  of  such
          compliance;

          (b)   To any reasonable extension in the time of delivery of  the
          DRILLSHIP that is necessary due to such compliance;

          (c)   To any reasonable deviation in the contractual displacement
          of   the   DRILLSHIP,  if  compliance  results  in   an   altered
          displacement, or any other reasonable alterations in the terms of
          this  Contract  or of the Specifications or both,  if  compliance
          makes such alterations of terms necessary.

         Such  agreement of the BUYER shall be effected in the same  manner
     as  provided  in  Paragraph 1 of this Article for  modifications  and/
     or changes of the Specifications.

3.   Substitution of Materials:

          In   the  event  that  any  of  the  materials  required  by  the
     Specifications  or otherwise under this Contract for the  construction
     of the DRILLSHIP can not be procured in time to effect delivery of the
     DRILLSHIP, or are in short supply, the BUILDER may, provided the BUYER
     so agrees in writing, supply other materials and equipment of the best
     available and like quality, capable of meeting the requirements of the
     Classification Society and of the rules, regulations, requirements and
     recommendations  with  which the construction of  the  DRILLSHIP  must
     comply.   Any agreement as to such substitution of materials shall  be
     effected in the manner as provided in Paragraph 1 of this Article, and
     shall,  likewise, include decrease or increase in the  Contract  Price
     and  other  terms  and conditions of this Contract  affected  by  such
     substitution.

                                                       (End of Article)

                ------------------------------------------

                    ARTICLE VI - TRIALS AND ACCEPTANCE

1.   Notice:

          The  sea  trial  shall  start when the  DRILLSHIP  is  reasonably
       completed in all material respects according to the Specifications.

          The  BUILDER  shall  give  the BUYER  at  least  Twenty(20)  days
       estimated prior notice and Seven(7) days confirming prior notice  in
       writing  or by telex confirmed in writing of the time and  place  of
       the  trial  run  of  the  DRILLSHIP, and the  BUYER  shall  promptly
       acknowledge  receipt  of  such notice.  The  BUYER  shall  have  its
       representative  and  his  assistant(s) on  board  the  DRILLSHIP  to
       witness such trial run.

          Failure in attendance of the BUYER's representative at the  trial
       run  of the DRILLSHIP for any reason whatsoever after due notice  to
       the  BUYER as above provided shall be deemed to be a waiver  by  the
       BUYER  of  its  right  to  have  its  representative  on  board  the
       DRILLSHIP  at the trial run, and the BUILDER may conduct  the  trial
       run  without attendance of the BUYER's representative, and  in  such
       case  the  BUYER shall be obligated to accept the DRILLSHIP  on  the
       basis   of  certificates  of  the  Classification  Society   and   a
       certificate  of the BUILDER stating that the DRILLSHIP,  upon  trial
       run, is found to conform to this Contract and the Specifications.

2.   Weather Condition:

          The  trial  run shall be carried out under the weather  condition
       which  is deemed favorable enough by the judgement of both the BUYER
       and  the  BUILDER.  In the event of unfavorable weather on the  date
       specified for the trial run, the same shall take place on the  first
       available day thereafter that the weather condition permits.  It  is
       agreed  that, if during the trial run of the DRILLSHIP, the  weather
       should  suddenly become so unfavorable that orderly conduct  of  the
       trial  run  can  no  longer be continued, the  trial  run  shall  be
       discontinued  and  postponed  until the  first  favorable  day  next
       following,  unless the BUYER shall assent in writing  to  acceptance
       of  the  DRILLSHIP on the basis of the trial run already made before
       such discontinuance has occurred.

          Any  delay  of  trial  run  caused by  such  unfavorable  weather
       condition shall operate to postpone the Delivery Date by the  period
       of  the delay involved and such delay shall be deemed as permissible
       delay in the delivery of the DRILLSHIP.

3.   How Conducted:

          (a)  The DRILLSHIP shall run the official trial run in the manner
          as specified in the Specifications.

          (b)   All expenses in connection with the trial run are to be for
          account of the BUILDER and the BUILDER shall provide, at its  own
          expense,  the  necessary crew to comply with conditions  of  safe
          navigation.

          (c)   BUYER shall furnish complete procedures and supervision for
          the installation, testing and precommissioning for the BOP stack.

4.   Method of Acceptance or Rejection.

          (a)  Upon completion of the trial run, the BUILDER shall give the
          BUYER a notice by telex confirmed in writing of completion of the
          trial  run,  as and if the BUILDER considers that the results  of
          trial  run indicate conformity of the DRILLSHIP to this  Contract
          and  the  Specifications.  The BUYER shall, within Five (5)  days
          after receipt of such notice from the BUILDER, notify the BUILDER
          by  telex  or  telefax confirmed in writing of its acceptance  or
          rejection of the trial results.

          (b)  However, if the result of the trial run is unacceptable,  or
          if  the  DRILLSHIP, or any part or equipment thereof,  (except  a
          defect  in  the  BUYER's Supplies not the responsibility  of  the
          BUILDER)  does  not conform to the requirements of this  Contract
          and/or  the Specifications, or if the BUILDER is in agreement  to
          non-  conformity as specified in the BUYER's notice of rejection,
          then, the BUILDER shall take necessary steps to correct such non-
          conformity.

              The  DRILLSHIP may be redocked in the event of unsatisfactory
          sea-trial  results  for  the  dynamic  positioning  and  thruster
          systems,  or  other  major  system malfunction  which  cannot  be
          repaired afloat.

              Upon completion of correction of such non-conformity, and re-
          test  or  trial  if necessary, the BUILDER shall give  the  BUYER
          notice thereof by telex or telefax confirmed in writing.

              The  BUYER shall, within Five (5) days after receipt of  such
          notice from the BUILDER, notify the BUILDER of its acceptance  or
          rejection  of  the  DRILLSHIP's conformity by  telex  or  telefax
          confirmed in writing.

          (c)  If any event that the BUYER rejects the DRILLSHIP, the BUYER
          shall  indicate  in  detail in its notice of  rejection  in  what
          respect the DRILLSHIP, or any part or equipment thereof (except a
          defect  in  the  BUYER's Supplies not the responsibility  of  the
          BUILDER)   does   not  conform  to  this  Contract   and/or   the
          Specifications.

          (d)   In the event that the BUYER fails to notify the BUILDER  by
          telex or telefax confirmed in writing of the acceptance of or the
          rejection  together  with the reason therefor  of  the  DRILLSHIP
          within  the period as provided in the above Sub-paragraph (a)  or
          (b), the BUYER shall be deemed to have accepted the trial results
          and/or the DRILLSHIP, as appropriate.

          (e)   Any  dispute between the BUILDER and the BUYER  as  to  the
          conformity or non-conformity of the DRILLSHIP to the requirements
          of this Contract and/or the Specifications shall be submitted for
          final decision in accordance with Article XII hereof.

5.   Effect of Acceptance:

          Acceptance of the DRILLSHIP as above provided in Paragraphs  4(a)
          or  4(b) of this Article VI shall be final and binding so far  as
          conformity   of   the  DRILLSHIP  to  this   Contract   and   the
          Specifications  is concerned and shall preclude  the  BUYER  from
          refusing   formal  delivery  of  the  DRILLSHIP  as   hereinafter
          provided,  if  the  BUILDER complies with all   other  procedural
          requirements  for  delivery as provided in  Article  VII  hereof.
          However, the BUYER's acceptance of the DRILLSHIP shall not affect
          the BUYER's rights under Article IX hereof.

6.   Disposition of Surplus Consumable Stores:

          Any fuel oil furnished and paid for by the BUILDER for trial runs
          remaining  on  board the DRILLSHIP, at the time of acceptance  of
          the DRILLSHIP by the BUYER, shall be bought by the BUYER from the
          BUILDER at the BUILDER's purchase price for such supply in  Korea
          and  payment  by the BUYER thereof shall be made at the  time  of
          delivery of the DRILLSHIP. The BUILDER shall pay the BUYER at the
          time  of  delivery  of the DRILLSHIP an amount for  the  consumed
          quantity  of any lubricating oil and greases which were furnished
          and paid for by the BUYER at the BUYER's purchase price thereof.

                                                       (End of Article)

                ------------------------------------------

                         ARTICLE VII - DELIVERY

1.   Time and Place:

          The  DRILLSHIP shall be delivered by the BUILDER to the BUYER  at
       the   Shipyard  on  August  31,  1999(unless  delays  occur  in  the
       construction  of the DRILLSHIP or in any performance required  under
       this  Contract due to causes which under the terms of this  Contract
       permit  postponement of the date of delivery, in  which  event,  the
       aforementioned date for delivery of the DRILLSHIP shall  be  changed
       accordingly)  or,  such  earlier  date  after  completion   of   the
       DRILLSHIP according to this Contract and the Specifications.

          The  aforementioned date, or such earlier or later date to  which
       the  requirement  of delivery is advanced or postponed  pursuant  to
       this Contract, is herein called the "Delivery Date".

2.   When and How Effected:

          Provided that the BUILDER and the BUYER shall have fulfilled  all
       of  their  obligations stipulated under this Contract, the  delivery
       of  the  DRILLSHIP  shall be effected forthwith  by  the  concurrent
       remittance  of the fifth installment in accordance with Article  II,
       Section  5(c)  and  delivery by each of the parties  hereto  to  the
       other  of  the  PROTOCOL  OF DELIVERY AND ACCEPTANCE,  acknowledging
       delivery  of the DRILLSHIP by the BUILDER and acceptance thereof  by
       the BUYER.

3.   Documents to be delivered to BUYER:

          Upon  delivery and acceptance of the DRILLSHIP, the BUILDER shall
       deliver  to the BUYER the following documents, which shall accompany
       the PROTOCOL OF DELIVERY AND ACCEPTANCE.

          (a)   PROTOCOL  OF TRIALS of the DRILLSHIP made pursuant  to  the
          Specifications.

          (b)   PROTOCOL  OF INVENTORY of the equipment of  the  DRILLSHIP,
          including  spare  parts  and  the  like,  as  specified  in   the
          Specifications.

          (c)   PROTOCOL OF STORES OF CONSUMABLE NATURE referred  to  under
          paragraph 6 of Article VI hereof.

          (d)   ALL  CERTIFICATES,  including  the  BUILDER's   CERTIFICATE
          required to be furnished upon delivery of the DRILLSHIP  pursuant
          to this Contract and the Specifications.

               It  is  agreed that if, through no fault on the part of  the
            BUILDER,   the   Classification   certificates   and/or   other
            certificates are not available at the time of delivery  of  the
            DRILLSHIP,  provisional certificates shall be accepted  by  the
            BUYER,  provided that the BUILDER shall furnish the BUYER  with
            the  formal  certificates as promptly as  possible  after  such
            certificates have been issued.

               Application  and  certificate for statutory  inspections  by
            Panamanian  Government shall be arranged by the  BUYER  at  its
            expense.

          (e)  DECLARATION OF WARRANTY of the BUILDER that the DRILLSHIP is
          delivered  to  the  BUYER free and clear of any  liens,  charges,
          claims,  mortgages, or other encumbrances upon the BUYER's  title
          thereto, and in particular that the DRILLSHIP is absolutely  free
          of all burdens in the nature of imposts, taxes or charges imposed
          by Korean Governmental Authorities, as  well  as  all liabilities
          of the BUILDER to its subcontractors, employees and crew,  and of
          the liabilities arising from the operation  of  the  DRILLSHIP in
          trial runs, or otherwise, prior to delivery.

          (f)  DRAWINGS AND PLANS pertaining to the DRILLSHIP as stipulated
          in the Specifications.

          (g)  COMMERCIAL INVOICE.

          (h)  Necessary export licenses, permits, and clearances by Korean
          Government  to enable the DRILLSHIP to sail from Korea  following
          delivery.

          (i)   DRAWINGS/OPERATING MANUALS.  All documentation,  including,
          but  not  limited  to  complete,  as-built  drawings,  operations
          manuals,  commissioning reports, inclining  reports,  major/minor
          equipment certifications, sea trial reports, spare parts list and
          BUILDER's vendor's documentation will be furnished by BUILDER  to
          BUYER on or before the delivery of the DRILLSHIP.

4.   Tender of DRILLSHIP:

          If  the  BUYER  fails  to take delivery of  the  DRILLSHIP  after
       completion   thereof   according   to   this   Contract   and    the
       Specifications  without any justifiable reason,  the  BUILDER  shall
       have   the   right  to  tender  delivery  of  the  DRILLSHIP   after
       accomplishment of all BUILDER's obligations as provided herein.


5.   Title and Risk:

          Title  to  and risk of loss of the DRILLSHIP shall  pass  to  the
       BUYER  only  upon  the delivery and acceptance thereof  having  been
       completed  as  stated  above;  it being expressly  understood  that,
       until  such delivery is effected, title to and risk of damage to  or
       loss of the DRILLSHIP and her equipment shall be in the BUILDER.

6.   Removal of DRILLSHIP:

          The BUYER shall take possession of the DRILLSHIP immediately upon
       delivery and acceptance thereof and shall remove the DRILLSHIP  from
       the  premises  of the Shipyard within Seven (7) days after  delivery
       and acceptance thereof is effected.

          If the BUYER shall not remove the DRILLSHIP from the premises  of
       the  Shipyard  within the aforesaid Seven (7) days, in  such  event,
       the  BUYER  shall pay to the BUILDER the reasonable mooring  charges
       of the DRILLSHIP.

                                                       (End of Article)

                ------------------------------------------

              ARTICLE VIII - DELAYS AND EXTENSION OF TIME FOR
                         DELIVERY (FORCE MAJEURE)

1.   Causes of Delay (Force Majeure):

          If,  at  any  time  either the construction or  delivery  of  the
       DRILLSHIP  or  any performance required hereunder as a  prerequisite
       to  the  delivery thereof is delayed by any of the following events;
       namely  war,  acts  of  state or government,  blockade,  revolution,
       insurrections,   mobilization,  civil  commotion,  riots,   strikes,
       sabotage,  lockouts,  Acts of God or the  public  enemy,  plague  or
       other   epidemics,  quarantines,  prolonged  failure   of   electric
       current,  freight  embargoes,  or  defects  in  major  forgings   or
       castings,  if any, or shortage of materials, machinery or  equipment
       in  inability to obtain delivery or delays in delivery of materials,
       machinery  or  equipment, provided that at the time of ordering  the
       same could reasonably be expected by the BUILDER to be delivered  in
       time,  or  defects in materials, machinery or equipment which  could
       not  have  been  detected by the BUILDER using reasonable  care,  or
       earthquakes,   tidal  waves,  typhoons,  hurricanes,  prolonged   or
       unusually severe weather conditions or delay in the construction  of
       the BUILDER's other newbuilding projects in the same drydock due  to
       any  such  causes as described in this Article which in  turn  delay
       the  keel laying and eventual delivery of the DRILLSHIP in  view  of
       the   Shipyard's  overall  building  programme  or   the   BUILDER's
       performance  under this Contract, or by destruction of the  premises
       or   works  of  the  BUILDER  or  its  sub-contractors,  or  of  the
       DRILLSHIP,  or  any  part  thereof,  by  fire,  landslides,   flood,
       lightning,  explosion, or other causes beyond  the  control  of  the
       BUILDER,  or  its sub-contractors, as the case may be,  or  for  any
       other  causes  which,  under terms of this Contract,  authorize  and
       permit  extension  of the time for delivery of the DRILLSHIP,  then,
       in  the  event  of  delays  due  to the  happening  of  any  of  the
       aforementioned  contingencies, the Delivery Date  of  the  DRILLSHIP
       under  this  Contract shall be extended for a period of  time  which
       shall not exceed the total accumulated time of all such delays.

2.   Notice of Delay:

          Within  Fourteen  (14) days after the date of occurrence  of  any
       cause  of delay, on account of which the BUILDER claims that  it  is
       entitled  under  this  Contract to a postponement  of  the  Delivery
       Date,  the BUILDER shall notify the BUYER in writing or by telex  or
       telefax  confirmed in writing of the date when such cause  of  delay
       occurred.   Likewise, within Fourteen (14) days after  the  date  of
       ending  of  such cause of delay, the BUILDER shall notify the  BUYER
       in  writing or by telex confirmed in writing of the date  when  such
       cause  of  delay ended.  The BUILDER shall also notify promptly  the
       BUYER  of  the  period, by which the Delivery Date is  postponed  by
       reason  of  such cause of delay.  If the BUILDER does not  give  the
       timely  advice as above, the BUILDER shall lose the right  to  claim
       such delays as permissible delay.

          Failure  of the BUYER to acknowledge to the BUILDER's  claim  for
       postponement  of the Delivery Date within Fourteen (14)  days  after
       receipt by the BUYER of such notice of claim shall be deemed  to  be
       a  waiver  by  the BUYER of its right to object to such postponement
       of the Delivery Date.

3.   Definition of Permissible Delay:

          Delays on account of such causes as specified in Paragraph  1  of
       this  Article and any other delay of a nature which under the  terms
       of  this Contract permits postponement of the Delivery Date shall be
       understood  to  be  permissible delays and are to  be  distinguished
       from  unauthorized delays on account of which the Contract Price  is
       subject to adjustment as provided for in Article III hereof.

4.   Right to Rescind for Excessive Delay:

          (a)   If the total accumulated time of all delays claimed by  the
          BUILDER on account of the causes specified in Paragraph 1 of this
          Article,  excluding other delays of the nature  which  under  the
          terms  of this Contract permit postponement of the Delivery Date,
          amounts  to One Hundred Eighty (180) days or more, then, in  such
          event, the BUYER may rescind this Contract in accordance with the
          provisions of Article X hereof.

             The BUILDER may, at any time after the accumulated time of the
          aforementioned delays justifying rescission by the BUYER,  demand
          in  writing that the BUYER shall make an election, in which  case
          the  BUYER  shall,  within Fourteen (14) BUILDER's  working  days
          after  such  demand  is received by the BUYER either  notify  the
          BUILDER of its intention to  rescind this Contract, or consent to
          a  postponement of the Delivery Date to a specified future  date,
          which  date  BUILDER  represents to BUYER is  the  earliest  date
          BUILDER  can  deliver  the  DRILLSHIP  to  BUYER,  based  on  the
          circumstances  then  known, it being understood  by  the  parties
          hereto  that  if  the DRILLSHIP is not delivered by  such  future
          date, the BUYER shall have the same right of rescission upon  the
          same terms and conditions as hereinabove provided.

          (b)   If  at  any time during the term of this Contract,  BUILDER
          falls  more  than  270  days behind in the  construction  of  the
          DRILLSHIP  according  to the Delivery and Construction  Schedule,
          for any reason whatsoever, and whether as a result of permissible
          delay  or  otherwise,  BUYER shall be entitled  to  give  written
          notice  to  BUILDER  that  BUYER considers  BUILDER  in  material
          default  of  its obligations under this Contract, and if  BUILDER
          has  not cured such default within Thirty (30) days after receipt
          of  such  notice,  BUYER  shall have the right  to  rescind  this
          Contract in accordance with the provisions of Article X hereof.

                                                       (End of Article)

                ------------------------------------------

                     ARTICLE IX - WARRANTY OF QUALITY

1.   Guarantee:

          The  BUILDER, for the period of Twelve (12) months after delivery
       of   the   DRILLSHIP   (hereinafter  called   "Guarantee   Period"),
       guarantees  the DRILLSHIP and her engines, including all  parts  and
       equipment  manufactured, furnished or installed by  the  BUILDER  or
       its   subcontractors  under  this  Contract,   and   including   the
       machinery,  equipment  and  appurtenances  thereof  (including   the
       installation work performed or required to be performed  by  BUILDER
       under   this   Contract  for  the   BUYER  supplied   or   furnished
       equipment),  under  the Contract but excluding  any  item  which  is
       supplied  or  designated  by the BUYER or by  any  other  bodies  on
       behalf  of  the  BUYER, against all defects and all damages  to  the
       DRILLSHIP resulting therefrom occurring within the Guarantee  Period
       which  are due to defective material, design and/or poor workmanship
       or  negligent or other improper acts or commissions on the  part  of
       the  BUILDER or its subcontractors (hereinafter called the  "Defect"
       or  "Defects") and are not a result of accident, ordinary  wear  and
       tear,  misuse,  mismanagement, negligent or other improper  acts  or
       omissions  or  neglect  on the part of the BUYER,  its  employee  or
       agents.

          The BUILDER shall arrange for the BUYER to obtain three (3) years
       guarantee  after  delivery of the DRILLSHIP for the paint  materials
       in   the  ballast  tank  coatings  through  the  paint  manufacturer
       selected  by  the  BUILDER.  But, the BUILDER's  guarantee  for  the
       ballast  tank coating shall be in no event longer than one (1)  year
       after  delivery of the DRILLSHIP unless major repairs as defined  in
       Clause  3  of  this  Article have arisen.  Such additional  extended
       guarantee   shall  proceed  between  the  BUYER  and  the   selected
       manufacturer  arranged  by  the  BUILDER.  Final  selection  of  the
       ballast  tank  coatings manufacturer is subject to the  approval  of
       the BUYER, not to be unreasonably withheld.

2.   Notice of Defects:

          The  BUYER  shall  notify the BUILDER in  writing,  or  by  telex
       confirmed  in writing, of any Defect for which claim is  made  under
       this  guarantee,  as  promptly as possible after discovery  thereof.
       The  BUYER's  written notice shall describe in  detail  the  nature,
       cause and extent of the Defects.

          The  BUILDER  shall have no obligation for any Defect  discovered
       prior  to the expiry date of the Guarantee Period, unless notice  of
       such  Defect  or any damage resulting therefrom is received  by  the
       BUILDER  not  later than Ten (10) BUILDER's working days  after  the
       expiry date of the Guarantee Period.

3.   Remedy of Defects:

          (a)  The BUILDER shall remedy, at its expense, any Defect against
          which  the DRILLSHIP is guaranteed under this Article, by  making
          all necessary repairs or replacements at the Shipyard.

          (b)   However,  if it is impracticable to bring the DRILLSHIP  to
          the  Shipyard,  the  BUYER  may cause the  necessary  repairs  or
          replacements  to be made elsewhere which is deemed  suitable  for
          the  purpose,  provided  that, in such  event,  the  BUILDER  may
          forward  or  supply  replacement  parts  or  materials   to   the
          DRILLSHIP,  unless  forwarding  or  supplying  thereof   to   the
          DRILLSHIP would impair or delay the operation or working schedule
          of  the DRILLSHIP.  In the event that the BUYER proposes to cause
          the  necessary  repairs or replacements for the DRILLSHIP  to  be
          made  at any other shipyard or works than the Shipyard, the BUYER
          shall  first,  but  in all events as soon as possible,  give  the
          BUILDER notice in writing or by telex confirmed in writing of the
          time  and place when and where such repairs will be made, and  if
          the DRILLSHIP is not thereby delayed, or her operation or working
          schedule  is  not thereby impaired, the BUILDER  shall  have  the
          right  to  verify by its own representative(s) the nature,  cause
          and  extent of the Defects complained of.  The BUILDER shall,  in
          such  case,  promptly  advise  the BUYER  by  telex,  after  such
          examination has been completed, of its acceptance or rejection of
          the  Defects  as  ones that are covered by the  guarantee  herein
          provided.   Upon  the  BUILDER's acceptance  of  the  Defects  as
          justifying  remedy  under this Article,  or  upon  award  of  the
          arbitration  so determining, the BUILDER shall pay to  the  BUYER
          for  such  repairs or replacements a sum equal to the  reasonable
          cost  of making the same repairs or replacements in a first class
          Korean  shipyard, at the prices prevailing at the  time  of  such
          repairs  or replacements are made.  The guarantee works shall  be
          settled  regularly  during  the  Guarantee  Period.   The  actual
          reimbursement for the guarantee shall be made in a  lump  sum  at
          the expiry of the Guarantee Period.

          (c)   In  any case, the DRILLSHIP shall be taken, at the  BUYER's
          cost  and  responsibility, to the place  elected,  ready  in  all
          respects for such repairs or replacement.

          (d)   Any  dispute  under  this  Article  shall  be  referred  to
          arbitration  in  accordance with the provisions  of  Article  XII
          hereof.

          (e)  Repairs under this Article are guaranteed for the balance of
          the  period set out in paragraph 1 of this Article but for  major
          repairs  are  guaranteed for the longer of  the  balance  of  the
          period  set  out in paragraph 1 of this Article or 6 months  from
          the  date of completion of major repairs, but in no event  longer
          than  18  months  after the Delivery Date. For  purposes  hereof,
          "major  repairs" shall be defined as a repair costing  more  than
          One Hundred Fifty Thousand United States Dollars (US$150,000).

4.   Extent of BUILDER's Responsibility:

          (a)   The  BUILDER shall have no responsibility or liability  for
          any  other  defect  whatsoever in the DRILLSHIP  other  than  the
          Defects  specified in Paragraph 1 of this Article, other than  to
          repair  all  damages  to  the  DRILLSHIP  discovered  within  the
          Guarantee  Period  and resulting from or caused  by  the  Defects
          which  are not attributable to the BUYER's (i) improper  acts  or
          omissions, (ii) negligence, or (iii) misuse.

             Nor  shall the BUILDER in any circumstances be responsible  or
          liable  for any consequential or special loss, damage or expense,
          including,  but not limited to, loss of time, loss of  profit  of
          earnings  or demurrage directly or indirectly occasioned  to  the
          BUYER  by reason of the Defects specified in Paragraph 1 of  this
          Article or due to repairs or other works done to the DRILLSHIP to
          remedy such Defects.

          (b)   The BUILDER shall not be responsible for any defect in  any
          part of the DRILLSHIP which may, subsequently to delivery of  the
          DRILLSHIP, have been replaced or repaired in any way by any other
          contractor,  unless  done pursuant to Paragraph  3  (b)  of  this
          Article,  or for any defect which have been caused or  aggravated
          by  omission or improper use and maintenance of the DRILLSHIP  on
          the part of the BUYER, its servants or agents or by ordinary wear
          and  tear  or  by any other cause beyond control of  the  BUILDER
          (other  than aggravation of defect or results of defect resulting
          from  the  use  or operation of the DRILLSHIP after knowledge  of
          same  by  BUYER,  where  such  continued  use  or  operation  was
          unavoidable to preserve or protect the safety of the DRILLSHIP or
          her crew).

          (c)   The  guarantee  contained as hereinabove  in  this  Article
          replaces  and  excludes any other liability, guarantee,  warranty
          and/  or  condition  imposed or implied by  the  law,  customary,
          statutory orotherwise, by reason of the construction and sale  of
          the DRILLSHIP by the BUILDER for and to the BUYER.

5.   Guarantee Engineer:

          The BUILDER shall, at the request of the BUYER, appoint a maximum
       of  two  (2)  Guarantee Engineers to serve on the DRILLSHIP  as  its
       representative for a period of up to Three (3) months from the  date
       the  DRILLSHIP  is delivered.  However, if the BUYER shall  deem  it
       necessary  to  keep the Guarantee Engineers on the DRILLSHIP  for  a
       longer  period,  then he shall remain on board the  DRILLSHIP  after
       the  said up to Three (3) months, up to but not longer than Six  (6)
       months from the delivery of the DRILLSHIP.

          The BUYER, and its employees, shall give such Guarantee Engineers
       full  cooperation  in carrying out his duties as the  representative
       of the BUILDER on board the DRILLSHIP.

           The   BUYER  shall  accord  the  Guarantee  Engineers  treatment
       comparable  to  the  DRILLSHIP's Chief Engineer, and  shall  provide
       board  and  lodging  at  no  cost to the BUILDER  or  the  Guarantee
       Engineers.   The BUILDER and the BUYER shall, prior to  delivery  of
       the  DRILLSHIP, execute a separate agreement regarding the Guarantee
       Engineers.

          While  the  Guarantee Engineers are on board the  DRILLSHIP,  the
       BUYER  shall pay to the Guarantee Engineers the sum of US$5,000  per
       month, the expenses of his repatriation to Seoul, Korea by air  upon
       termination  of his service, the expenses of his communication  with
       the  BUILDER incurred in performing his duties and expenses, if any,
       of his medical and hospital care in the DRILLSHIP's hospital.

          BUILDER will have the option, at BUILDER's sole risk and expense,
       to  place  a  maximum of two (2) Guarantee Engineers  on  board  the
       DRILLSHIP  for  a period of up to six (6) months.   The  BUYER  will
       provide  board, lodging, communications and general working  support
       services  at  no cost to the BUILDER or the Guarantee Engineers  but
       all other expenses shall be for the sole account of BUILDER.

                                                       (End of Article)

                ------------------------------------------

                      ARTICLE X - RESCISSION BY BUYER

1.   Notice:

          The payments made by the BUYER prior to delivery of the DRILLSHIP
       shall  be in the nature of advances to the BUILDER, and in the event
       that  the DRILLSHIP after sea trial is rejected by the BUYER or  the
       Contract  is rescinded by the BUYER in accordance with the terms  of
       this  Contract under and pursuant to any of the provisions  of  this
       Contract specifically permitting the BUYER to do so, then the  BUYER
       shall  notify  the  BUILDER  in writing or  by  telex  confirmed  in
       writing, and such rescission shall be effective as of the date  when
       notice thereof is received by the BUILDER.

2.   Refundment by BUILDER:

          In case the BUILDER receives the notice stipulated in Paragraph 1
       of  this Article, the BUILDER shall promptly refund to the BUYER the
       full  amount of all sums paid by the BUYER to the BUILDER on account
       of  the  DRILLSHIP, together with the interest thereon,  unless  the
       BUILDER  proceeds to the arbitration under the provisions of Article
       XII hereof.

          In  the event of such rescission by the BUYER, the BUILDER  shall
       pay  the BUYER interest at the rate of Eight percent (8%) per  annum
       on  the amount required herein to be refunded to the BUYER, computed
       from  the date following the respective date on which such sums were
       paid  by  the  BUYER  to the BUILDER to the date  of  remittance  by
       transfer  of  such  refund to the BUYER by  the  BUILDER,  provided,
       however, that if the said rescission by the BUYER is made under  the
       provisions  of  Paragraph 4 of Article VIII  hereof,  then  in  such
       event  the BUILDER shall pay the BUYER interest at the rate of  Four
       percent (4%) per annum on the sums refundable.

          As  security for refund of installments prior to delivery of  the
       DRILLSHIP,  the  BUILDER shall furnish to BUYER, prior  to  the  due
       date  of  the first installment, with a letter of guarantee covering
       the  amount  of  such pre-delivery installments and  issued  by  the
       BUILDER's  BANK  in favour of the BUYER.  Such letter  of  guarantee
       shall have substantially the same form and substance as Exhibit  "A"
       annexed hereto.

          The  BUILDER  represents and warrants that Korean law  no  longer
       requires  issuance  of  an Export License on the  Option  Vessel  in
       connection   with  issuance  of,  or  payment  under,   the   Refund
       Guarantee, and shall remain responsible to provide to the BUYER  any
       such  Export  License as and to the extent required by  Korean  law,
       whether now or in the future.

3.   Discharge of Obligations:

       Upon  such  refund  by  the BUILDER to the BUYER,  all  obligations,
       duties  and liabilities of each of the parties hereto to  the  other
       under  this  Contract  shall  be  forthwith  completely  discharged,
       without  prejudice,  however, to any claims either  party  may  have
       resulting  from  the other party's breach of any of its  obligations
       under this Contract.

                                                      (End of Article)

                ------------------------------------------

                       ARTICLE XI - BUYER'S DEFAULT

1.   Definition of Default:

          The BUYER shall be deemed to be in default of its performance  of
       obligations under this Contract in the following cases:

          (a)  If the first, second, third, fourth or fifth installment  is
          not paid by the BUYER to the BUILDER within Three(3) banking days
          in  New  York after such installment becomes due and  payable  as
          provided in Article II hereof; or

          (b)   If  the sixth installment is not paid by the BUYER  to  the
          BUILDER in New York at the time such installment becomes due  and
          payable  upon  delivery of the Vessel as provided in  Article  II
          hereof; or

          (c)   If  the increased amount in the Contract Price as  adjusted
          due and payable upon delivery of the DRILLSHIP is not paid by the
          BUYER concurrently with delivery of the DRILLSHIP as provided  in
          Article II hereof; or

          (d)   If  the  BUYER,  when the DRILLSHIP is  duly  tendered  for
          delivery by the BUILDER in accordance with the provisions of this
          Contract, fails to accept the DRILLSHIP within Five (5) days from
          the  tendered date without any specific and valid ground  thereof
          under this Contract.

2.   Effect of Default on or before Delivery of DRILLSHIP:

          (a)   Should the BUYER make default in payment of any installment
          of the Contract Price on or before delivery of the DRILLSHIP, the
          BUYER  shall  pay  the  installment(s) in  default  plus  accrued
          interest  thereon  at the rate of eight percent  (8%)  per  annum
          computed  from the due date of such installment to the date  when
          the  BUILDER  receives  the payment,  and,  for  the  purpose  of
          Paragraph  1  of  Article VII hereof, the Delivery  Date  of  the
          DRILLSHIP  shall  be  automatically  extended  by  a  period   of
          continuance of such default by the BUYER.

                In  any event of default by the BUYER, the BUYER shall also
          pay  all  charges and expenses incurred to the BUILDER in  direct
          consequence of such default.

          (b)   If  any default by the BUYER continues for a period of  Ten
          (10)  days, the BUILDER may, at its option, rescind this Contract
          by  giving  notice of such effect to the BUYER by telex confirmed
          in writing.

       Upon  dispatch  by  the BUILDER of such notice of  rescission,  this
       Contract shall be forthwith rescinded and terminated.  In the  event
       of  such  rescission of this Contract, the BUILDER shall be entitled
       to  retain any installment or installments already paid by the BUYER
       to  the  BUILDER  on  account  of  this  Contract  and  the  BUYER's
       Supplies, if any.

3.   Disposal of DRILLSHIP:

          (a)   In the event that this Contract is rescinded by the BUILDER
          under  the  provisions  of Paragraph 2(b) of  this  Article,  the
          BUILDER  may,  at  its  sole  discretion,  either  complete   the
          DRILLSHIP  and  sell  the  same, or sell  the  DRILLSHIP  in  its
          incomplete state, free of any right or claim of the BUYER.   Such
          sale  of  the DRILLSHIP by the BUILDER shall be either by  public
          auction or private contract at the BUILDER's sole discretion  and
          on such terms and conditions as the BUILDER shall deem fit.

          (b)   In  the event of such sale of the DRILLSHIP, the amount  of
          the  sale received by the BUILDER shall be applied firstly to all
          expenses attending such sale or otherwise incurred to the BUILDER
          as  a  result of the BUYER's default, secondly to the payment  of
          all  costs and expenses of construction of the DRILLSHIP incurred
          to the BUILDER less BUYER's Supplies and the installments already
          paid  by  the BUYER, and then to the compensation to the  BUILDER
          for  a  reasonable  loss  of profit due  to  rescission  of  this
          Contract,  and  finally to the repayment  to  the  BUYER  if  any
          balance is obtained.

          (c)   If the proceeds of sale are insufficient to pay such  total
          costs  and loss of profit as aforesaid, the BUYER shall  promptly
          pay the deficiency to the BUILDER upon request.

4.   Dispute:

          Any  dispute under this Article shall be referred to  arbitration
       in accordance with the provisions of Article XII hereof.

                                                       (End of Article)

                ------------------------------------------

                         ARTICLE XII - ARBITRATION

1.   Decision by the Classification Society:

          If any dispute arises between the parties hereto in regard to the
       design  and/or  construction  of the DRILLSHIP,  its  machinery  and
       equipment,  and/or  in respect of the materials  and/or  workmanship
       thereof  and/or  thereon, and/or in respect  of  interpretations  of
       this  Contract  or  the Specifications, the parties  may  by  mutual
       agreement  refer  the dispute to the Classification  Society  or  to
       such  other  expert  as may be mutually agreed between  the  parties
       hereto,  and  whose decision shall be final, conclusive and  binding
       upon the parties hereto.

2.   Proceedings of Arbitration:

          In  the  event that the parties hereto do not agree to  settle  a
       dispute  according  to  Paragraph 1 of this Article  and/or  in  the
       event  of  any  other  dispute of any kind  whatsoever  between  the
       parties  and  relating  to this Contract or its  rescission  or  any
       stipulation  herein, such dispute shall be submitted to  arbitration
       in  London.  Each party shall appoint an arbitrator and in the event
       that  they  cannot  agree, the two arbitrators  so  appointed  shall
       appoint  an Umpire. If the two arbitrators are unable to agree  upon
       an  Umpire  within Twenty (20) days after appointment of the  second
       arbitrator,  either of the said two arbitrators  may  apply  to  the
       President  for  the  time being of the London  Maritime  Arbitrators
       Association to appoint the Umpire, and the two arbitrators  and  the
       Umpire  shall constitute the Board of Arbitration.  Such arbitration
       shall  be  in accordance with and subject to the provisions  of  the
       British Arbitration Act 1979, or any statutory modification  or  re-
       enactment thereof for the time being in force.

          Either party may demand arbitration of any such dispute by giving
       notice to the other party.  Any demand for arbitration by either  of
       the  parties hereto shall state the name of the arbitrator appointed
       by  such  party  and shall also state specifically the  question  or
       questions  as to which such party is demanding arbitration.   Within
       Fourteen  (14)  days  after receipt of notice  of  such  demand  for
       arbitration,  the  other  party  shall  in  turn  appoint  a  second
       arbitrator  and  give notice in writing of such appointment  to  the
       party  demanding  arbitration.  If  a  party  fails  to  appoint  an
       arbitrator  as  aforementioned within Fourteen (14)  days  following
       receipt of notice of demand for arbitration by the other party,  the
       party  failing  to  appoint an arbitrator shall be  deemed  to  have
       accepted  and  appointed,  as  its own  arbitrator,  the  arbitrator
       appointed  by  the party demanding arbitration and  the  arbitration
       shall  proceed before this sole arbitrator who alone in  such  event
       shall constitute the Arbitration Board.

          The  award  of the arbitrators and/or Umpire shall be  final  and
       binding on both parties.

3.   Notice of Award:

          The award decision shall immediately be communicated to the BUYER
     and the BUILDER by facsimile and confirmed in writing.

4.   Expenses:

           The Arbitration Board shall determine which party shall bear the
     expenses of the arbitration or the portion of such expenses which each
     party shall bear.

5.   Entry in Court:

           In  case of failure by either party to respect the award of  the
     arbitration, the judgement may be entered in any proper  court  having
     jurisdiction thereof.

6.   Alteration of Delivery Date:

           In  the event of reference to arbitration of any dispute arising
     out of matters occurring prior to delivery of the DRILLSHIP, the award
     may  include any adjustment of the Delivery Date which the Arbitration
     Board may deem appropriate.

                                                       (End of Article)

                ------------------------------------------

                   ARTICLE XIII - SUCCESSOR AND ASSIGNS

      Neither of the parties hereto shall assign this Contract to any other
individual or company unless prior consent of the other party is  given  in
writing,  such  consent not to be unreasonably withheld, provided  however,
that  subsequent  to the payment of the first installment of  the  Contract
Price, BUYER, upon giving notice in writing to the BUILDER, shall be freely
entitled  to assign, in whole or in part, its rights and obligations  under
this  Contract  to  any person, company or entity whatsoever.   The  notice
given by BUYER of such assignment shall include a reasonable explanation of
the  purpose of the assignment and shall provide sufficient information  so
as  to  allow  the  BUILDER  to  advise the BUILDER's  Bank  regarding  any
amendment  of the name of the beneficiary of the Refund Guarantee  provided
for in Article X hereof.  Upon such assignment, the BUYER shall provide  to
BUILDER a copy of any assignment made pursuant hereto.

     In the event of any assignment pursuant to the terms of this Contract,
the assignee shall succeed to all of the assigned rights and obligations of
the  assignor under this Contract and, to the extent assigned, the assignor
shall  have  no further right or obligation hereunder. Should BUYER  assign
this  Contract, any assignee or subsequent assignee of this Contract  shall
succeed  to  the rights of the BUYER to further assign this Contract  under
this Article XIII.

                                                       (End of Article)

                ------------------------------------------

                      ARTICLE XIV - TAXES AND DUTIES

1.   Taxes and Duties Incurred in Korea:

          The BUILDER shall bear and pay all taxes, duties, stamps and fees
       incurred  in  Korea in connection with execution and/or  performance
       of  this  Contract as the BUILDER, and any taxes and duties  imposed
       in  Korea  upon  the  BUYER's Supplies resulting  from  the  failure
       attributable  to  the  BUILDER in taking all appropriate  action  to
       have  such  BUYER's  Supplies imported into  Korea  under  bond  for
       ultimate export with the DRILLSHIP following delivery.

2.   Taxes and Duties Incurred Outside Korea:

          The  BUYER  shall  bear and pay all taxes (other  than  taxes  on
       income  imposed  on  BUILDER),  duties,  stamps  and  fees  incurred
       outside  Korea  in connection with execution and/or  performance  of
       this  Contract  as  the BUYER, except for taxes and  duties  imposed
       upon those items (other than BUYER's Supplies) to be procured by  or
       for  the  BUILDER for construction of the DRILLSHIP which  shall  be
       the responsibility of the BUILDER.

                                                       (End of Article)

                ------------------------------------------

            ARTICLE XV - PATENTS, TRADEMARKS, COPYRIGHTS, ETC.

1.   Patents:

           Except  as  to  BUYER's  Supplies,  BUILDER  agrees  to  defend,
       indemnify  and hold BUYER harmless from any liability or  claims  of
       patent infringement of any nature or kind (including legal fees  and
       expenses)  relating to the infringement or claimed  infringement  of
       patent  rights  of  any third party with respect  to  any  material,
       service,  process, or apparatus covered by this Contract,  or  their
       use for their intended purpose.

          With  regards  to the performance of the current Contract,  BUYER
       shall  defend, indemnify and hold BUILDER harmless from  all  claims
       of  infringement of patent rights of any third party related to  (i)
       processes supplied by BUYER or (ii) BUYER's Supplies.

          Except  as  otherwise  provided for in  this  Agreement,  nothing
       contained  herein shall be construed as transferring any  rights  in
       any  patents,  trademarks or copyrights utilized in the  performance
       of this Contract.

2.   General Plans, Specifications and Working Drawings:

           The   BUILDER   retains  all  rights   with   respect   to   the
       Specifications,   and   plans   and  working   drawings,   technical
       descriptions,   calculations,   test   results   and   other   data,
       information and documents concerning the design and construction  of
       the  DRILLSHIP except for such technical documents which  have  been
       provided  solely  by  the BUYER or its agents  or  servants  to  the
       BUILDER   in  connection  with  design  and  construction   of   the
       DRILLSHIP,  and the BUYER undertakes therefore not to  disclose  the
       same  or  divulge  any information contained therein  to  any  third
       parties,  without  the prior written consent of  the  BUILDER  (such
       consent   not  to  be  unreasonably  withheld)  except  where   such
       disclosure  is necessary for usual operation, repair and maintenance
       of the DRILLSHIP.

3.   Exceptions:

          (a)   Notwithstanding anything else contained in this Article XV,
          the BUILDER    agrees that it will not, without the prior written
          consent  of  the BUYER, no to be unreasonably withheld,  disclose
          any information or data or material of any nature and in whatever
          form concerning or regarding the following:

               Topside Specification (Exhibit 2)

               This provision XV.3.(a) shall be in effect for 12 months
               from Contract signing.

          (b)   Notwithstanding anything else contained in this Article XV,
          the  BUILDER agrees that the BUYER may use any information, data,
          or  material  of  any nature and in whatever form  concerning  or
          regarding  the  power distribution design and management  of  the
          DRILLSHIP and the topside Specifications for its own benefit.

                                                       (End of Article)

            --------------------------------------------------

                      ARTICLE XVI - BUYER'S SUPPLIES

1.   Responsibility of BUYER:

          (a)   The BUYER shall, at its own risk, cost and expense,  supply
          and  deliver  to the BUILDER all of the items to be furnished  by
          the  BUYER  as specified in the Specifications(herein called  the
          BUYER's Supplies) to a first point of arrival (mainly the port of
          Pusan,  Korea  or  other  places as may  be  agreed  between  the
          parties)  in  Korea in good condition.   Once  delivered  to  the
          first point of arrival in Korea, the BUYER's Supplies will be  at
          the  BUILDER's risk. Prior to the transportation of  the  BUYER's
          Supplies within Korea, the BUILDER shall make a visual inspection
          of  BUYER's Supplies and report to BUYER any apparent  damage  to
          the BUYER's Supplies. BUYER and BUILDER shall inspect the BUYER's
          Supplies  upon  arrival  thereof at  the  Shipyard  to  determine
          whether   the   BUYER's  Supplies  comply  with  the  contractual
          specifications  or   have been damaged during the transportation.
          If  as  the  result of such inspections, (i) any  defect  to  the
          BUYER's  Supplies  is found, or (ii) any damage  to  the  BUYER's
          Supplies  occurring prior to arrival at the first point in  Korea
          is  found,  then all the   remedies and replacements thereof  are
          the  responsibility  of the BUYER. Any delay or  direct  expenses
          regarding   the  construction of the DRILLSHIP  resulting  solely
          from BUYER's failure to have the   BUYER's Supplies delivered  in
          Korea  as  agreed herein shall be the     BUYER's responsibility.
          Risk  of transportation within Korea to the Shipyard and risk  of
          offloading,  uncrating and storage of the BUYER's  Supplies  upon
          their arrival at the Shipyard will be with BUILDER.  However, the
          cost for inland transportation, customs clearance, insurance  for
          inland  transportation and other costs, if any, for  the  BUYER's
          Supplies  shall be one point eight percent (1.8%) of the  BUYER's
          Supplies amount on the C.I.F. value basis, which shall be paid by
          the  BUYER  to the BUILDER together with the payment of  the  5th
          installment pursuant to Article II hereof.  In case such  BUYER's
          Supplies  are  delivered directly to the  Koje  Shipyard  by  the
          BUYER, the applicable cost (rate) shall be reduced to zero  point
          zero  percent (0.0%) of the BUYER's Supplies amount on the  basis
          of  C.I.F. value, except BUYER will pay for customs clearance  or
          any  third  party costs.  BUYER's Supplies sent to  ports  nearby
          Koje  Shipyard  (like  Changsengpo and  Okpo)  will  be  assessed
          charges  for transportation, customs clearance fee, harbor  union
          fee, pilotage and other costs that are incurred by the BUILDER to
          facilitate  delivery of the BUYER's Supplies  to  Koje  Shipyard.
          These fees will be charged at actual direct cost.  Any loss of or
          damage  to the BUYER's Supplies after they are in the custody  of
          the  BUILDER  will be for the account of the BUILDER and  BUILDER
          will  replace or repair any BUYER's Supplies that may be lost  or
          damaged,  and  a  subsequent  delay  due  to  the  foregoing  and
          resulting  cost  impact  will  be the  BUILDER's  responsibility.
          BUILDER  agrees and acknowledges that any or all of  the  BUYER's
          Supplies  may arrive at the Shipyard in individual  parts  or  as
          component parts to be placed in or made a part of a larger system
          or  module.  The BOP is to arrive in not more than four (4)  main
          components.

          (b)   In  order to facilitate installation by the BUILDER of  the
          BUYER's  Supplies in or on the DRILLSHIP, the BUYER shall furnish
          the  BUILDER  with  necessary  specifications,  plans,  drawings,
          instruction   books,  manuals,  test  reports  and   certificates
          required by the rules and regulations of the Specifications.   If
          so requested by the BUILDER, the BUYER, without any charge to the
          BUILDER, shall cause the representatives of the manufacturers  of
          the  BUYER's  Supplies  to  advise the  BUILDER  in  installation
          thereof in or on the DRILLSHIP.

          (c)   Any and all of the BUYER's Supplies shall be subject to the
          BUILDER's reasonable right of rejection, as and if they are found
          to be unsuitable or in improper condition for installation.

          (d)   A preliminary Delivery Schedule of the BUYER's Supplies and
          vendor data specific to the DRILLSHIP (Hull No. 1255) showing the
          BUILDER's   requested  delivery  dates   is   attached   to   the
          Specifications.   The Delivery Schedule of the  BUYER's  Supplies
          and  vendor data shall be mutually agreed, finalized and  settled
          within  Sixty  (60)  calendar days  from  the  date  of  contract
          signing.  The  delivery dates agreed to on the Delivery  Schedule
          will be the dates BUYER's Supplies are required at first point in
          Korea.   Should  the  BUYER fail to deliver any  of  the  BUYER's
          Supplies  within  Ten  (10) days of the time  designated  by  the
          Delivery  Schedule,  the  Delivery Date  shall  be  automatically
          extended  for  a period  not to exceed the actual  delay,  beyond
          ten(10)  days,  incurred by the BUILDER.   If  no  delay  in  the
          delivery  of  the  DRILLSHIP  is incurred  by  the  BUILDER,  the
          Delivery Date shall not change.

          (e)   If delay in delivery of any of the BUYER's Supplies exceeds
          thirty  (30) days, then, the BUILDER shall be entitled to proceed
          with  construction of the DRILLSHIP without installation  thereof
          in  or  on  the DRILLSHIP as hereinabove provided, and the  BUYER
          shall  accept  and take delivery of the DRILLSHIP so constructed,
          unless  such delay is caused by Force Majeure in which  case  the
          provision Paragraph 1(d) of this Article shall apply.

          (f)   The  insurance  for  the BUYER's Supplies  during  storage,
          construction  and  installation at the Shipyard  is  covered  and
          handled by the BUILDER at its cost and responsibility.

2.   Responsibility of BUILDER:

          The  BUILDER  shall be responsible for storing and handling  with
       reasonable  care of the BUYER's Supplies after delivery  thereof  at
       the  Shipyard, and shall, at its own cost and expense, install  them
       in  or  on the DRILLSHIP, unless otherwise provided herein or agreed
       by  the parties hereto, provided, always, that the BUILDER shall not
       be  responsible for quality, efficiency and/or performance of any of
       the  BUYER's Supplies (other than to install same in accordance with
       the  manufacturer's specifications and requirements, copies of which
       have been provided to BUILDER by BUYER).

          It  will be the BUILDER's responsibility at no cost to BUYER  to:
       (i)  assemble  the  BUYER's  Supplies,  bulk  material  and  provide
       modularization  and  integration  engineering,  except   procurement
       engineering  related to the BUYER's Supplies, at the Shipyard;  (ii)
       test  the  BUYER's  Supplies  as  necessary  or  appropriate;  (iii)
       construct  modules  from the BUYER's Supplies as  appropriate;  (iv)
       test  and pre-commission the modules containing the BUYER's Supplies
       and  to generally test all of the BUYER's Supplies; (v) install  the
       BUYER's  Supplies  on  the DRILLSHIP, in modules,  as  required,  or
       otherwise  as  required, and to integrate the BUYER's Supplies  into
       the  overall  designed system of the DRILLSHIP; (vi) test  and  pre-
       commission  the  integrated modules and systems; and (vii)  complete
       and  test  the  entire  drilling  system  where  practicable  (i.e.,
       equipment functional test only, not full operational load  test)  to
       insure  that it works harmoniously as a part of the drilling process
       and  the  DRILLSHIP  so  as  to be able to accomplish  its  intended
       purpose.   In no event will BUILDER charge any additional  cost  for
       any  of  the above.  Pre-commission or pre-commissioning as used  in
       this  Contract or the Specifications means the putting into  service
       or  the  commissioning to be done at the Shipyard prior to  delivery
       and  acceptance. Pre-commission or pre-commissioning does  not  mean
       commissioning that occurs elsewhere.

3.   Title:

          Title  to  BUYER's Supplies shall at all times remain with  BUYER
       during  the Contract; however, BUILDER shall have the risk  of  loss
       of  or  damage  to such BUYER's Supplies from the time  set  out  in
       subparagraph 1(a) of this Article until delivery of the DRILLSHIP.

4.   BUYER's Suppplies Refundment:

          Notwithstanding anything else contained in this Contract, BUILDER
       agrees  that  if  for  any reason whatsoever the  DRILLSHIP  is  not
       delivered  to  BUYER,  other than as a result  of   BUYER's  default
       under  Article  XI  of this Contract, then BUILDER  shall  remit  to
       BUYER  the  full  value  of  all BUYER's Supplies  which  have  been
       delivered  to  the  Shipyard or which BUILDER has taken  custody  of
       under  this Article XVI.  BUILDER shall remit all amounts due  under
       this  paragraph  4 upon written demand by BUYER and  upon  BUILDER's
       request,  BUYER  will furnish BUILDER with reasonable  documentation
       showing  BUYER's cost of BUYER's Supplies.  BUILDER shall remit  all
       amounts due within thirty (30) days of demand.

                                                       (End of Article)

            --------------------------------------------------

                         ARTICLE XVII - INSURANCE

1.   Extent of Insurance Coverage:

          From  the  time of the launching until delivery of the DRILLSHIP,
       the  BUILDER shall, at its own cost and expense, keep the  DRILLSHIP
       and   all  machinery,  materials  and  equipment  delivered  to  the
       Shipyard  for the DRILLSHIP or built into or installed  in  or  upon
       the  DRILLSHIP  (except  the BUYER's Supplies)  fully  insured  with
       first  class  insurance  companies or  underwriters  in  Korea  with
       coverage  corresponding  to the Institute  of  London  Underwriter's
       Clauses for Builder's Risks.  From the time of the first arrival  of
       the  BUYER's Supplies in Korea until delivery of the DRILLSHIP,  the
       BUILDER  shall  keep  the BUYER's Supplies fully  insured  with  the
       aforementioned   insurance  companies  or  underwriters   to   cover
       Builder's Risk.

          The  amount of such insurance coverage shall, up to the  date  of
       delivery of the DRILLSHIP, be an amount at least equal to,  but  not
       limited to, the aggregate of the payments made by the BUYER  to  the
       BUILDER plus Fifty Million United States Dollars (US$50,000,000)  to
       cover BUYER's Supplies in the custody of the Shipyard.

          The policy referred to in this paragraph for the BUYER's Supplies
       shall  be  taken out in the name of the BUILDER and BUYER, as  their
       interests  may  appear, and all losses under such  policy  shall  be
       payable to the BUILDER and BUYER, as their interests may appear.

2.   Application of the Recovered Amounts:

          In the event that the DRILLSHIP shall be damaged from any insured
       cause  at  any  time before delivery of the DRILLSHIP,  and  in  the
       further  event that such damage shall not constitute  an  actual  or
       constructive  total  loss of the DRILLSHIP, the amount  received  in
       respect  of the insurance shall be applied by the BUILDER in  repair
       of  such  damage,  satisfactory to the Classification  requirements,
       and  the  BUYER  shall accept the DRILLSHIP under this  Contract  if
       completed  in  accordance with this Contract and the Specifications,
       however,  subject  to the extension of delivery time  under  Article
       VIII hereof (except in case of negligence of the BUILDER).

           Should  the  DRILLSHIP  from  any  cause  become  an  actual  or
       constructive total loss, the BUILDER shall either:

          (a)   Proceed  in accordance with the terms of this Contract,  in
          which  case the amount received in respect of the insurance shall
          be  applied  to  the construction and repair  of  damage  of  the
          DRILLSHIP,  provided the parties hereto shall have  first  agreed
          thereto  in writing and to such reasonable extension of  delivery
          time   as   may   be  necessary  for  the  completion   of   such
          reconstruction and repair; or

          (b)   Refund  promptly to the BUYER the full amount of  all  sums
          paid  by  the BUYER to the BUILDER as installments in advance  of
          delivery  of the DRILLSHIP, and deliver to the BUYER all  BUYER's
          Supplies  (or the insurance proceeds paid with respect  thereto),
          in  which  case this Contract shall be deemed to be automatically
          terminated and shall be deemed rescinded for purposes of  Article
          X  hereof and all rights, duties, liabilities and obligations  of
          each  of  the  parties  to the other shall  forthwith  cease  and
          terminate.

3.   Termination of BUILDER's Obligation to Insure:

          The  BUILDER shall be under no obligation to insure the DRILLSHIP
       hereunder after delivery of the DRILLSHIP.

                                                       (End of Article)

            --------------------------------------------------

                          ARTICLE XVIII - NOTICE

1.   Address:

          Any  and  all notices and communications in connection with  this
       Contract shall be addressed as follows:

     To the BUYER:

     Reading & Bates Drilling Co.
     901 Threadneedle
     Houston, Texas 77079-2902

     Facsimile No.:(281)589-5189

     To the BUILDER:
     Samsung Heavy Industries Co., Ltd.
     Dongnam Tower Building
     850-25, Daichi-dong, Kangnam-ku,
     Seoul, Korea
     Facsimile No.:  (822) 3458 6503
                   (822) 3458 6501

     or preferably to its Koje Yard:

     Samsung Heavy Industries Co., Ltd.
     P.O. Box Gohyun 9
     530, Jangpyung-ri, Sinhyun-up,
     Koje-gun, Kyungnam, Korea
     Telex No.:  K52213
     Facsimile No.: (82558) 32 2160  (Design Department)
                    (82558) 636 2560 (Customer Coordination Team)

2.   Language:

          Any  and  all notices and communications in connection with  this
       Contract shall be written in the English language.

3.   Effective Date of Notice:

           The  notice  in  connection  with  this  Contract  shall  become
       effective  from the date when such notice is received by  the  BUYER
       or  by  the BUILDER except otherwise described in the Contract.   In
       case  any notice is made by facsimile confirmed in writing, the date
       when the  facsimile is received shall govern.

                                                       (End of Article)

                ------------------------------------------

                 ARTICLE XIX - EFFECTIVE DATE OF CONTRACT

           This Contract shall become effective upon signing by the parties
hereto.

          In  the  event  the  refund guarantee  has  not  been  issued  by
       September  15,  1997 and the BUYER provided same,  the  BUYER  shall
       have  the  right to terminate the Shipbuilding Contract  by  written
       notice  to  BUILDER  within five business days thereafter.   If  the
       BUYER  exercises such option, neither party shall have any liability
       or obligation to the other under this Contract.

                                                       (End of Article)

            --------------------------------------------------

                        ARTICLE XX - INTERPRETATION

1.   Laws Applicable:

          The parties hereto agree that the validity and the interpretation
       of  this  Contract  and of each Article and part  thereof  shall  be
       governed by the laws of England.

2.   Discrepancies:

           All   general   language  or  requirements   embodied   in   the
       Specifications  are intended to amplify, explain and  implement  the
       requirements  of  this Contract.  However, in  the  event  that  any
       language  or  requirements  so  embodied  permit  an  interpretation
       inconsistent with any provision of this Contract, then, in each  and
       every  such event, the applicable provisions of this Contract  shall
       prevail   and  govern.   In  the  event  of  conflict  between   the
       Specifications  and  Plans,  the Specifications  shall  prevail  and
       govern.

3.   Entire Agreement:

          This  Contract  contains the entire agreement  and  understanding
       between  the  parties hereto and supersedes all prior  negotiations,
       representations, undertakings and agreements on any  subject  matter
       of this Contract.

4.   Amendments and Supplements:

           Any   supplement,  memorandum  of  understanding  or  amendment,
       whatsoever form it may be relating to this Contract, to be made  and
       signed  among parties hereof after signing this Contract,  shall  be
       the  integral  part of this Contract and shall be  predominant  over
       the  respective  corresponding  Article  and/or  Paragraph  of  this
       Contract.

                                                       (End of Article)

            --------------------------------------------------

                       ARTICLE XXI - CONFIDENTIALITY

     BUILDER and BUYER agree that the terms and conditions of this Contract
shall  remain confidential and neither party shall disclose any such  terms
and  conditions of this Contract to any third party without first obtaining
the prior written consent of the other, provided however, that either party
shall be entitled to disclose any or all of the terms and conditions of the
Contract  to  the extent it is necessary to do so to implement,  effectuate
and  comply  with  the terms of the Contract or to otherwise  exercise  any
right  or  discharge any obligation that party may have  pursuant  to  this
Contract.

     BUILDER shall require the engine maker/manufacturer (Wartsila) and the
maker/manufacturer  of  the  positioning  system  to  sign  confidentiality
agreements agreeing to keep strictly confidential all information furnished
to  such  party  or  developed in connection with the performance  of  this
Contract.

                                                       (End of Article)

            --------------------------------------------------

     IN WITNESS WHEREOF, the parties hereto have caused this Contract to be
duly executed on the day and year first above written.

BUYER:                                  BUILDER:

READING & BATES DRILLING CO.                 SAMSUNG HEAVY INDUSTRIES  CO.,
LTD.

By:                                     By:
Title:                                  Title:


                                        SAMSUNG CORPORATION

                                        By:
                                        Title:

               --------------------------------------------------

                                EXHIBIT "A"

                    LETTER OF REFUNDMENT GUARANTEE NO.

Gentlemen:

      We  hereby open our irrevocable letter of guarantee No. in favour  of
___________________________ (hereinafter called the "BUYER") for account of
Samsung  Corporation,  Seoul,  Korea as follows  in  consideration  of  the
shipbuilding  contract dated __________________, 1997  (hereinafter  called
the  "Contract") made by and among the BUYER and Samsung Corporation as the
contractor  and  Samsung Heavy Industries Co., Ltd.  as  its  subcontractor
(hereinafter collectively called the "BUILDER") for the construction of one
(1)   drillship  composed of hull part and topside part,  having  BUILDER's
Hull No. ___________ (hereinafter called the "DRILLSHIP").

     If in connection with the terms of the Contract the BUYER shall become
entitled to a refund of the advance payment(s) made to the BUILDER prior to
the  delivery  of  the  DRILLSHIP,  we  hereby  irrevocably  guarantee  the
repayment   of   the   same   to   the   BUYER   immediately   on    demand
_________________________ (Say _______________________ only) together  with
interest thereon at the rate of _________ per cent per annum from the  date
following  the date of receipt by the BUILDER to the date of remittance  by
telegraphic transfer of such refund.

     The amount of this guarantee will be automatically increased, not more
than   ______  (  )  times,  upon  BUILDER's  receipt  of  the   respective
installment:    each   time   by  the  amount   of   installment   of   USD
________________,  USD ___________________, USD _____________________,  USD
_______________________  and  USD  ___________________  respectively,  plus
interest  thereon as provided in the Contract, but in any  eventuality  the
amount   of   this   guarantee  shall  not  exceed   the   total   sum   of
____________________ (Say _________________ only) plus interest thereon  at
the  rate of eight per cent (8%) per annum from the date following the date
of  BUILDER's  receipt  of each installment to the date  of  remittance  by
telegraphic transfer of the refund.

      In  case any refund is made to you by the BUILDER or by us under this
guarantee,  our liability hereunder shall be automatically reduced  by  the
amount of such refund.

      In  the event of rescission of the Contract being based on delays due
to  force  majeure or other causes beyond the control of  the  BUILDER,  as
required  by Article X of the Contract, interest shall be paid at the  rate
of  four  percent  (4%)  per  annum from the date  following  the  date  of
Builder's  receipt  of  each  installment to  the  date  of  remittance  by
telegraphic transfer of the refund.

      This  letter of guarantee is available against BUYER's simple receipt
and  signed  statement certifying that BUYER's demand for refund  has  been
made  in  conformity  with Article X of the Contract and  the  BUILDER  has
failed to make the refund within Thirty (30) days after your demand to  the
BUILDER.   Refund  shall  be  made  to  you  by  telegraphic  transfer   in
__________________.

      This  letter of guarantee shall expire and become null and void  upon
receipt by the BUYER of the sum guaranteed hereby or upon acceptance by the
BUYER  of  delivery of the DRILLSHIP in accordance with the  terms  of  the
Contract and, in either case, this letter of guarantee shall be returned to
us.   This  guarantee  is valid from the date of this letter  of  guarantee
until  delivery or in the event of delayed delivery until such time as  the
DRILLSHIP is delivered by the BUILDER to the BUYER in accordance  with  the
terms of the Contract.

      Notwithstanding  the  provisions  hereinabove,  in  case  we  receive
notification  from  you or the BUILDER confirmed by the  Arbitration  Board
stating  that  your  claim  to  rescind the  Contract  or  your  claim  for
refundment  thereunder  has been disputed and referred  to  Arbitration  in
accordance  with the provisions of the Contract, the period of validity  of
this  guarantee  shall be extended until Thirty (30) days after  the  final
award  shall be rendered in the Arbitration and a copy thereof acknowledged
by  the  Arbitration  Board.  In such case, this  guarantee  shall  not  be
available unless and until such acknowledged copy of the final award in the
Arbitration justifying your claim is presented to us.

      This  guarantee  shall not be affected by any extension  of  time  or
concession  granted by the BUYER to the BUILDER or any delay or failure  of
the BUYER in enforcing its rights under the Contract.

     The BUYER shall have the right to assign this guarantee and all of its
benefits to any assignee to whom the Contract is assigned.

     This guarantee shall be governed by the laws of England.

                                   Very truly yours,


                                   _____________________________________