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EXHIBIT 10.1




SEPARATION AGREEMENT




     THIS SEPARATION AGREEMENT (the “Agreement”) made and entered into
effective October 8, 2004, by and between Pride International, Inc. (the
“Company”) and John C.G. O’Leary (the “Executive”);



W I T N E S S E T H:




     WHEREAS, the Executive and the Company are parties to that certain
Employment/Non-Competition/Confidentiality Agreement entered into on February
5, 1999 (the “Employment Agreement”); and



     WHEREAS, the parties mutually desire to enter into this Agreement
reflecting the terms of the Executive’s separation from the Company and its
subsidiaries; and



     WHEREAS, in consideration of the mutual promises contained herein, the
parties hereto are willing to enter into this Agreement upon the terms and
conditions herein set forth.



     NOW, THEREFORE, in consideration of the premises, the terms and provisions
set forth herein, the mutual benefits to be gained by the performance thereof
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:



     1. Separation from Employment and Officer, Director and Executive
Positions. Effective as of September 9, 2004 (the “Separation Date”), the
Executive’s employment with the Company was terminated. Furthermore, as of the
Separation Date, the Executive shall be deemed as terminated from any and all
officer, director and executive positions he held with the Company and its
subsidiaries.



     2. Consideration for Prior Agreement and Waiver and Release. The
Executive shall have until 21 calendar days after the date this Agreement was
furnished to him to consider whether to sign and return this Agreement and the
attached Waiver and Release (Attachment A) to the Company by first class mail
or by hand delivery. In consideration for the Executive’s execution of this
Agreement, including but not limited to compliance with (i) the Confidentiality
provisions of Section 4.A.; (ii) the Non-Solicitation provisions of Section
4.B.; (iii) the Non-Compete provisions of Section 4.C.; and (iv) the execution
of the Waiver and Release attached hereto as Attachment A, the Company shall
provide the consideration set forth in this Section 2 on five (5) business days
following the Effective Waiver Date. This consideration is provided subject to
the binding timely execution by the Executive (without revocation) of the
Waiver and Release (Attachment A). The date that is seven days after the
execution of the Waiver and Release shall be the “Effective Waiver Date.”




      A. Separation Payment. The Company shall pay Executive a separation
payment of $1,000,000, which is equal to two (2) times the Executive’s
base salary in effect as of the Separation Date, payable within five (5)
business days following the Effective Waiver Date.



 









 






      B. Stock Awards. Any restricted stock awarded to the Executive
under any incentive plan of the Company which is unvested as of the
Separation Date shall become immediately vested as of the Effective
Waiver Date. Any stock options awarded to the Executive under any
incentive plan of the Company which remain unexercised as of the
Separation Date shall become fully vested and exercisable as of the
Effective Waiver Date and all of the options shall remain exercisable
until the original expiration date of the applicable option as if the
Executive were considered still continuously employed with the Company
and not terminated, subject to the other terms and conditions of the
applicable incentive plan and award agreement not inconsistent herewith.




      C. Benefits Coverage. The Company shall provide Executive and his
qualifying dependents continuing coverage under the Company’s group
health, accident and disability, medical and dental benefit plan, and the
Executive shall continue to be covered by the Company’s group life
insurance coverage, in accordance with and subject to the terms and
conditions of such plans, until the second anniversary of the Separation
Date subject to (i) the Executive’s continued payment of the employee
portion of the then-applicable premium, if any, as such portion and
premiums are in effect from time to time, and (ii) the Company’s ability
to amend or terminate its benefit plans generally, at any time. The
Company’s obligation to pay or provide medical and dental benefits or
life insurance coverage shall be reduced when and to the extent such
continued benefit coverage is paid or provided to the Employee and his
qualifying dependents by another employer.




      D. Supplemental Executive Retirement Plan. In exchange for the
Executive’s benefits under the Company’s Supplemental Executive
Retirement Plan, the Company agrees to pay the Executive a monthly
payment, commencing upon his attainment of age 62, in the amount of
$3,333, payable for the Executive’s life, and in the event that upon his
death he is survived by his “Spouse” (as hereinafter defined), his Spouse
shall receive a monthly amount from the Company for the remainder of her
life in the amount of $1,667. If the Executive dies before attaining age
62, the Company shall pay the Executive’s Spouse a monthly payment for
her life, commencing on the date the Executive would have attained age
62, in the amount of $1,667. For purposes of this Section 2.D., the term
“Spouse” shall mean the person to whom the Executive is lawfully married
both as of the Separation Date and at the earlier of (i) the time of the
Executive’s death or (ii) the date the Executive attains age 62. The
Executive agrees that the payment provided under this Section 2.D. is in
full satisfaction of any and all rights the Executive, and anyone
claiming a benefit through the Executive, may have under the terms of the
Company’s Supplemental Executive Retirement Plan, the associated
Participation Agreement entered into on August 12, 2004, and any
predecessor agreements.




      E. Bonus. The Company agrees to pay Executive a bonus payment of
$550,000, which is equal to two (2) times the annual bonus for the 2004
calendar year, payable within five (5) business days following the
Effective Waiver Date. In addition, the Company shall pay Executive a
target bonus for calendar year 2004 of $188,650, which is equal to 55% of
the Executive’s base salary prorated from January 2004 through the
Separation Date, payable within five (5) business days following the
Effective Waiver Date.



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      F. Indemnification. The Company hereby agrees to waive and release
the Executive from any and all claims, demands, actions, liabilities and
damages arising out of any actions taken by the Executive in the course
and scope of his employment with the Company, and to indemnify and defend
the Executive for such actions to the fullest extent permitted by
applicable law consistent with the Company’s Certificate of Incorporation
and By-Laws, if such actions were taken in good faith and in a manner the
Executive reasonably believed to be in, or not opposed to, the best
interest of the Company, but excluding actions which the Executive knew,
or should have known, were in violation of applicable law or Company
policies or otherwise in breach of any agreement between the Executive
and the Company or its subsidiaries. The Executive hereby agrees to
indemnify the Company, its subsidiaries and their respective predecessor
entities for any and all claims, demands, actions, liabilities and
damages arising out of actions which the Executive knew, or should have
known, were in violation of applicable law or Company policies or
otherwise in breach of any agreement between the Executive and the
Company or its subsidiaries.



     3. Other Benefits. The Executive’s benefits under the Company’s 401(k)
Retirement and Savings Plan and 401(k) Restoration Plan shall be determined and
paid in accordance with the terms of such plans. The amount deducted from the
Executive’s compensation as a result of his election to participate in the
Company’s Employee Stock Purchase Plan in 2004, together with interest
allocated thereto, shall be paid to the Executive in accordance with the terms
of the Employee Stock Purchase Plan.



     4. Restrictive Covenants. The Executive acknowledges certain obligations
under Section 5 of the Employment Agreement and hereby reaffirms those
obligations as set forth below:




      A. Confidentiality. The Executive acknowledges that in the course
of his employment with the Company he has obtained specialized knowledge
which, if used in competition with the Company, or divulged to others,
could cause serious harm to the Company. Accordingly, the Executive will
not at any time, directly or indirectly, divulge, disclose or communicate
to any person, firm or corporation (in any manner whatsoever) any
information concerning any matter affecting or relating to the Company or
the business of the Company, unless authorized by the Company. The
Executive agrees to the foregoing without regard to whether all of the
foregoing matters will be deemed confidential, material or important, it
being stipulated by the parties that all information, whether written or
otherwise, regarding the Company’s business, including, but not limited
to, information regarding customers, customer lists, costs, prices,
earnings, products, services, formulae, compositions, machinery,
equipment, apparatus, systems, manufacturing procedures, operations,
potential acquisitions, new location plans, prospective and executed
contracts and other business arrangements, and sources of supply, is
confidential information of the Company for the purposes of this
Agreement, except to the extent that such information may be otherwise
lawfully and readily available to the general public. The Executive
further represents that, within seven (7) days after the Separation Date,
he returned to the Company all books, records, lists and other written,
typed or printed materials, including without limitation any
computer-generated, computer-stored or electronically-stored
communications,



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documents or other materials, whether furnished by the Company or
prepared by the Executive, which contain any information relating to the
Company’s business, and the Executive represents that he neither made nor
retained any copies of such materials. The content of the discussions
pertaining to this Agreement shall be considered and treated as
confidential and the Company, its employees, and the Executive shall not
discuss or otherwise disclose, in any manner, the substance or content of
discussions involved in reaching this Agreement to any person other than
the Executive’s attorney and tax/financial advisors and as required by
appropriate taxing or other legal authorities, unless authorized by the
Company.




      B. Non-Solicitation.




        1. The Executive agrees that for a period of two (2) years
after the Separation Date, the Executive will not, directly or
indirectly, either as an individual, proprietor, stockholder (other
than as a holder of up to one percent (1%) of the outstanding
shares of a corporation whose shares are listed on a stock exchange
or traded in accordance with the automated quotation system of the
National Association of Securities Dealers), partner, officer,
employee or otherwise, solicit, aid, counsel or encourage any
officer, director, employee or other individual to: (i) leave his
or her employment or position with the Company (ii) compete with
the business of the Company, or (iii) violate the terms of any
employment, non-competition or similar agreement with the Company
where such agreement is known to the Executive.




        2. The Executive further agrees that for a period of two (2)
years after the Separation Date, the Executive will not directly or
indirectly; permit, where the Executive has authority to permit or
deny such permission, the employment of; employ or contract for
services or work to be performed by; or otherwise, use or utilize
the services of any officer, director or employee of the Company or
any such officer, director, or employee of the Company who has
terminated employment with the Company within the preceding two (2)
years, except where such officer, director, employee or other
individual is terminated by the Company, or except where there is a
prior agreement between the Company and the Executive.




      C. Non-Compete. The Executive acknowledges that his employment with
the Company has in the past provided him with specialized knowledge
which, if used in competition with the Company could cause serious harm
to the Company. Accordingly, the Executive agrees that for a period of
two (2) years after the Separation Date, the Executive will not, directly
or indirectly, either as an individual, proprietor, stockholder (other
than as a holder of up to one percent (1%) of the outstanding shares of a
corporation whose shares are listed on a stock exchange or traded in
accordance with the automated quotation system of the National
Association of Securities Dealers), partner, officer, employee or
otherwise:




        1. work for, become an employee of, invest in, provide
consulting services or in any way engage in any business which
provides, produces, leases or



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sells products or services of the same or similar type
provided, produced, leased or sold by the Company and with regard
to which the Executive was engaged, or over which the Executive had
direct or indirect supervision or control, within three (3) years
preceding the Separation Date, in any area where the Company
provided, produced, leased or sold such products or services at any
time during the three (3) years preceding the Separation Date, or




        2. provide, sell, offer to sell, lease, offer to lease, or
solicit any orders for any products or services which the Company
provided and with regard to which the Executive had direct or
indirect supervision or control, within three (3) years preceding
the Separation Date, to or from any person, firm or entity which
was a customer for such products or services of the Company during
the three (3) years preceding the Separation Date from whom the
Company had solicited business during such three (3) year period.



     It is specifically agreed between the Company and the Executive that the
Executive shall be free to engage in the sale, purchase, and brokering activity
of drilling rig assets without being in violation of Section 4.C. of this
Separation Agreement. It is further specifically agreed between the Company
and the Executive that the Executive shall be free to engage in oil field
services activities other than drilling if the Company sells, transfers, or
otherwise disposes of its oil field services business after the Effective
Waiver Date without being in violation of Section 4.C. of this Separation
Agreement.




      D. Enforcement. The Executive hereby agrees that a violation of the
provisions of Section 4 would cause irreparable injury to the Company and
its affiliates, for which they would have no adequate remedy at law. The
Company shall have the right to seek injunctive relief from a court
having jurisdiction for any actual or threatened breach of Section 4.
Any such injunctive relief shall be in addition to any other remedies to
which the Company may be entitled at law or in equity or otherwise. In
addition, the Executive agrees that a violation of this Section 4 will
result in an immediate suspension of payments and benefits otherwise
payable or provided by the Company described in Section 2 of this
Agreement, including forfeiture of vested but unexercised stock options.




      E. Interpretation. If any provision of Section 4 is found by a
court of competent jurisdiction to be unreasonably broad, oppressive or
unenforceable, such court (i) shall narrow the scope of the Agreement in
order to ensure that the application thereof is not unreasonably broad,
oppressive or unenforceable and (ii) to the fullest extent permitted by
law, shall enforce such Agreement as though reformed.




      F. Company. As used in this Section 4, the term “Company” includes
the Company and any direct or indirect subsidiary of the Company.




      G. Geographical Area. The geographical area within which the non-
competition covenants of this Agreement shall apply is that territory
within two hundred (200) miles of: (i) any of the Company’s present
offices, (ii) any of the Company’s present rig yards or rig operations
and (iii) any additional location where the Company has an office, a rig
yard, a rig operation or definitive plans to locate an office, a rig
operation or a rig yard or has recently conducted rig operations, as
of the date of any action taken in violation of the non-competition
obligations and covenants of the Agreement.




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     5. Non-Alienation. The Executive shall not have any right to pledge,
hypothecate, anticipate, or in any way create a lien upon any amounts provided
under this Agreement, and no payments or benefits due hereunder shall be
assignable in anticipation of payment either by voluntary or involuntary acts
or by operation of law. So long as the Executive lives, no person, other than
the parties hereto, shall have any rights under or interest in this Agreement
or the subject matter hereof. Upon the death of the Executive, his executors,
administrators, devisees and heirs, in that order, shall have the right to
enforce the provisions hereof.



     6. Amendment of Agreement. This Agreement may not be modified or amended
except by an instrument in writing signed by the parties hereto.



     7. Waiver. No term or condition of this Agreement shall be deemed to have
been waived, nor shall there be an estoppel against the enforcement of any
provision of this Agreement, except by written instrument of the party charged
with such waiver or estoppel.



     8. Venue. Any suit, action or other legal proceeding arising out of this
Agreement shall be brought in the United States District Court for the Southern
District of Texas, Houston Division, or, if such court does not have or will
not accept jurisdiction, in any court of general jurisdiction in Harris County,
Texas. Each of the Executive and the Company consents to the jurisdiction of
any such court in any such suit, action, or proceeding and waives any objection
that it may have to the laying of venue of any such suit, action or proceeding
in any such court.



     9. Notices. All notices or communications hereunder shall be in writing,
addressed as follows:


To the Company:


Pride International, Inc.

5847 San Felipe, Suite 3300

Houston, Texas 77057

Attention: General Counsel


To the Executive:


John C.G. O’Leary

37 Avenue de Lowendal

75015

Paris, France


All such notices shall be conclusively deemed to be received and shall be
effective; (i) if sent by hand delivery, upon receipt, (ii) if sent by telecopy
or facsimile transmission, upon confirmation of receipt by the sender of such
transmission or (iii) if sent by registered or certified mail, on the fifth day
after the day on which such notice is mailed.



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     10. Source of Payments: All cash payments provided in this Agreement will
be paid from the general funds of the Company. The Executive’s status with
respect to amounts owed under this Agreement will be that of a general
unsecured creditor of the Company, and the Executive will have no right, title
or interest whatsoever in or to any investments which the Company may make to
aid the Company in meeting its obligations hereunder. Nothing contained in
this Agreement, and no action taken pursuant to this provision, will create or
be construed to create a trust of any kind between the Company and the
Executive or any other person.



     11. Tax Withholding. The Company may withhold from any benefits payable
under this Agreement all federal, state, city or other taxes that will be
required pursuant to any law or governmental regulation or ruling.



     12. Severability. If any provision of this Agreement is held to be
invalid, illegal or unenforceable, in whole or part, such invalidity will not
affect any otherwise valid provision, and all other valid provisions will
remain in full force and effect.



     13. Counterparts. This Agreement may be executed in two or more
counterparts, each of which will be deemed an original, and all of which
together will constitute one document.



     14. Titles. The titles and headings preceding the text of the paragraphs
and subparagraphs of this Agreement have been inserted solely for convenience
of reference and do not constitute a part of this Agreement or affect its
meaning, interpretation or effect.



     15. Governing Law. This Agreement will be construed and enforced in
accordance with the laws of the State of Texas.



     16. Entire Agreement. This Agreement constitutes the entire agreement of
the parties with respect to the subject matter hereof. This Agreement
expressly supersedes the Employment Agreement, and, to the extent the terms of
this Agreement vary from the terms of any other agreement between the Company
and the Executive, this Agreement expressly supersedes such other agreement.



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     IN WITNESS WHEREOF, the parties have executed this Agreement in multiple
counterparts, all of which shall constitute one agreement, as of the dates set
forth below but effective as of the date and year first above written.

	 	 	 	 	 
	 	PRIDE INTERNATIONAL, INC.

 	 
	 	By:  	/s/ Paul A. Bragg
 	 
	 	 	Paul A. Bragg 	 
	 	 	President & Chief Executive Officer 	 
	 
 
 
 
 	Date: October 13, 2004 




ATTEST:




/s/ W. Gregory Looser



W. Gregory Looser

Vice President, General Counsel

and Secretary



	 	 	 	 	 
	 	JOHN C.G. O’LEARY

 	 
	 	/s/ John C.G. O'Leary
 	 
	 	 	 
	 	 	 
	 
 
 
 
 	Date: October 8, 2004 



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Attachment A




Dated: October 8, 2004




WAIVER AND RELEASE





     In exchange for the consideration offered under the Separation Agreement
between me and Pride International, Inc. (the “Company”), dated October 8, 2004
(the “Separation Agreement”), I hereby waive all of my claims and release the
Company, its affiliates and its subsidiaries and each of their directors and
officers, executives and agents, and benefit plans and the fiduciaries and
agents of said plans (collectively referred to as the “Corporate Group”) from
any and all claims, demands, actions, liabilities and damages.



     I understand that signing this Waiver and Release is an important legal
act. I acknowledge that the Company has advised me in writing to consult an
attorney before signing this Waiver and Release. I further acknowledge that I
was given 21 calendar days after the date the Separation Agreement was
furnished to me to consider whether to sign and return the Separation Agreement
to the Company.



     In exchange for the consideration offered to me by the Separation
Agreement, which I acknowledge provides consideration to which I would not
otherwise be entitled, I agree not to sue or file any action or proceeding with
any local, state and/or federal agency or court regarding or relating in any
way to the Company, except for breach of this Separation Agreement, and I
knowingly and voluntarily waive all claims and release the Corporate Group from
any and all claims, demands, actions, liabilities, and damages, whether known
or unknown, arising out of or relating in any way to the Corporate Group,
except with respect to rights under the Separation Agreement, and such rights
or claims as may arise after the date this Waiver and Release is executed.
This Waiver and Release includes, but is not limited to, claims and causes of
action under: Title VII of the Civil Rights Act of 1964, as amended; the Age
Discrimination in Employment Act of 1967, as amended; the Civil Rights Act of
1866, as amended; the Civil Rights Act of 1991; the Americans with Disabilities
Act of 1990; the Older Workers Benefit Protection Act of 1990; the Employee
Retirement Income Security Act of 1974, as amended, except to the extent
necessary to enforce my rights under the terms of any plan identified in
Section 2.C. or 3 of the Separation Agreement; the Family and Medical Leave Act
of 1993; and/or contract, tort, defamation, slander, wrongful termination or
other claims or any other state or federal statutory or common law.



     Should any of the provisions set forth in this Waiver and Release be
determined to be invalid by a court, agency or other tribunal of competent
jurisdiction, it is agreed that such determination shall not affect the
enforceability of other provisions of this Waiver and Release.



     I acknowledge that this Waiver and Release and the Separation Agreement
set forth the entire understanding and agreement between me and the Company or
any other member of the Corporate Group concerning the subject matter of this
Waiver and Release and supersede the Employment Agreement (as defined in the
Separation Agreement) and any other prior or contemporaneous oral and/or
written agreements or representations, if any, between me and the Company or
any other member of the Corporate Group.



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     I understand that for a period of seven (7) calendar days following my
signing this Waiver and Release (the “Waiver Revocation Period”), I may revoke
my acceptance of the offer by delivering a written statement to the Company by
hand or by registered mail, addressed to the address for the Company specified
in the Separation Agreement, in which case the Waiver and Release will not
become effective. In the event I revoke my acceptance of this offer, the
Company shall have no obligation to provide me the consideration offered under
the Separation Agreement to which I would not otherwise have been entitled. I
understand that failure to revoke my acceptance of the offer within the Waiver
Revocation Period will result in this Waiver and Release being permanent and
irrevocable.



     I acknowledge that I have read this Waiver and Release, have had an
opportunity to ask questions and have it explained to me and that I understand
that this Waiver and Release will have the effect of knowingly and voluntarily
waiving any action I might pursue, including breach of contract, personal
injury, retaliation, discrimination on the basis of race, age, sex, national
origin or disability and any other claims arising prior to the date of this
Waiver and Release.



     By execution of this document, I do not waive or release or otherwise
relinquish any legal rights I may have which are attributable to or arise out
of acts, omissions or events of the Company or any other member of the
Corporate Group which occur after the date of execution of this Waiver and
Release.



AGREED TO AND ACCEPTED this

8th day of October, 2004.





/s/ John C.G. O’Leary



JOHN C.G. O’LEARY




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