UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

FORM 10-K

For the fiscal year ended December 31, 2004

For the transition period from                      to                     

Commission file number: 0-13857

NOBLE CORPORATION

     Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

     Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o

     Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act). Yes þ No o

     Aggregate market value of Ordinary Shares held by nonaffiliates as of June 30, 2004: $4,990,000,000

     Number of Ordinary Shares outstanding as of March 3, 2005: 135,569,061

DOCUMENTS INCORPORATED BY REFERENCE

     Listed below are documents parts of which are incorporated herein by reference and the part of this report into which the document is incorporated:

     (1) Proxy statement for the 2005 annual general meeting of members - Part III

TABLE OF CONTENTS

FORM 10-K

     This report on Form 10-K includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts included in this Form 10-K, including, without limitation, statements contained in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations”, regarding our financial position, business strategy, plans and objectives of management for future operations, industry conditions, and indebtedness covenant compliance, are forward-looking statements. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we cannot assure you that such expectations will prove to have been correct. We have identified factors that could cause actual plans or results to differ materially from those included in any forward-looking statements. These factors include, but are not limited to, the following:

	•	volatility in crude oil and natural gas prices;
	•	changes in our customers’ drilling programs or budgets due to their own internal corporate events, changes in the markets and prices for oil and gas, or shifts in the relative strengths of various geographic drilling markets brought on by things such as a general economic slowdown, or regional or worldwide recession, any of which could result in deterioration in demand for our drilling services;
	•	our inability to execute any of our business strategies;
	•	cost overruns or delays in shipyard repair, maintenance, conversion or upgrade projects;
	•	changes in tax laws, tax treaties or tax regulations or the interpretation or enforcement thereof, including taxing authorities not agreeing with our assessment of the effects of such laws, treaties and regulations;
	•	cancellation by our customers of drilling contracts or letter agreements or letters of intent for drilling contracts or their exercise of early termination provisions generally found in our drilling contracts;
	•	intense competition in the drilling industry;
	•	changes in the rate of economic growth in the U.S. or in other major international economies;
	•	political and economic conditions in markets where we from time to time operate;
	•	adverse weather (such as hurricanes and monsoons) and seas;
	•	operational risks (such as blowouts, fires and loss of production);
	•	changes in oil and gas drilling technology or in our competitors’ drilling rig fleets that could make our drilling rigs less competitive or require major capital investment to keep them competitive;
	•	costs and effects of unanticipated legal and administrative proceedings;
	•	limitations on our insurance coverage or our inability to obtain or maintain insurance coverage at rates and with deductible amounts that we believe are commercially reasonable;
	•	the discovery of significant additional oil and/or gas reserves or the construction of significant oil and/or gas delivery or storage systems that impact regional or worldwide energy markets;
	•	requirements and potential liability imposed by governmental regulation of the drilling industry (including environmental regulation);
	•	acts of war or terrorism;

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	•	significant changes in trade, monetary or fiscal policies worldwide, including changes in interest rates; and
	•	currency fluctuations between the U.S. dollar and other currencies.

     All of the foregoing risks and uncertainties are beyond our ability to control, and in many cases, we cannot predict the risks and uncertainties that could cause our actual results to differ materially from those indicated by the forward-looking statements. When used in this Form 10-K, the words “believes”, “anticipates”, “expects”, “plans” and similar expressions as they relate to the Company or its management are intended to identify forward-looking statements.

PART I

ITEM 1. BUSINESS.

GENERAL

     We are a leading provider of diversified services for the oil and gas industry. We perform contract drilling services with our fleet of 60 offshore drilling units located in key markets worldwide. This fleet consists of 13 semisubmersibles (including five Noble EVA-4000^TM semisubmersibles and four ultra-deepwater hulls), three dynamically positioned drillships, 41 jackup rigs and three submersibles. For additional information on the specifications of the fleet, see “Item 2. Properties-Drilling Fleet.” Approximately 80 percent of the fleet is currently deployed in international markets, principally including the Middle East, Mexico, the North Sea, Brazil, West Africa, India and the Mediterranean Sea. We provide technologically advanced drilling-related products and services designed to create value for our customers. We also provide labor contract drilling services, well site and project management services, and engineering services.

     Noble Corporation, a Cayman Islands exempted company limited by shares (which we sometimes refer to in this report as “Noble”), became the successor to Noble Drilling Corporation, a Delaware corporation (which we sometimes refer to as “Noble Drilling”) that was organized in 1939, as part of the internal corporate restructuring of Noble Drilling and its subsidiaries effective April 30, 2002. For more information on this restructuring, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations-Corporate Restructuring.” Noble and its predecessors have been engaged in the contract drilling of oil and gas wells for others domestically since 1921 and internationally during various periods since 1939. As used herein, unless otherwise required by the context, the term “Noble” refers to Noble Corporation and the terms “Company”, “we”, “our” and words of similar import refer to Noble and its consolidated subsidiaries. The use herein of such terms as group, organization, we, us, our and its, or references to specific entities, is not intended to be a precise description of corporate relationships.

BUSINESS STRATEGY

     Our long-standing business strategy continues to be the active expansion of our international offshore drilling and deepwater capabilities through acquisitions, rig upgrades and modifications, and the deployment of assets in important geological areas.

     Since the beginning of 2000, we have mobilized nine jackup rigs and one semisubmersible from the U.S. Gulf of Mexico to international markets. In addition, since the beginning of 2000 we have added nine jackups to our international fleet through acquisitions. We continue to evaluate other opportunities to deploy units in our fleet, including certain deepwater units, in important geological areas worldwide.

     Both the level of drilling activity and the number of announced discoveries and related development programs in water depths greater than 5,000 feet have increased substantially in recent years, thus increasing the demand for rigs capable of drilling in these water depths. As such, in recent years we have focused on increasing the number of rigs in our fleet capable of ultra-deepwater offshore drilling. Since the beginning of 2000, we have

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added two deepwater semisubmersibles to our fleet and have acquired two additional semisubmersible baredeck hulls.

     The offshore contract drilling industry has, in recent years, experienced a series of asset sales and consolidations among drilling contractors, and we expect this trend to continue as drilling contractors position themselves strategically in the market. From time to time, we discuss asset transactions or business combinations with others, and we intend to continue to consider business opportunities that we believe promote our business strategy. As noted above, since the beginning of 2000 we have added 13 units to our fleet through acquisitions and joint ventures (see “-Business Development During 2004” below).

     In addition, as part of our strategy, we have focused on the continued development of technological applications for the drilling industry. We believe these applications differentiate our fleet by incorporating new technology, enhancing our reputation with our customers, and providing a mechanism to grow our earnings with lower capital investment requirements than required for our fleet of drilling rigs. Our Noble Drilling Technology Division is engaged in this activity.

BUSINESS DEVELOPMENT DURING 2004

     As part of our strategy to expand our international operations, we acquired three jackup rigs, which are currently in the Middle East, and we mobilized the Noble Homer Ferrington semisubmersible to Nigeria from the U.S. Gulf of Mexico for a long-term contract that commenced in November 2004. In December 2003, we mobilized the Noble Carl Norberg jackup rig to the Mediterranean Sea from the U.S. Gulf of Mexico for a 14-month contact, which commenced in January 2004. Also in December 2003, we mobilized the Noble Dick Favor jackup rig from Brazil to the Middle East. Following an upgrade project, the unit commenced operations in August 2004. In addition, since September 2002 we have mobilized a total of seven jackup rigs to Mexico from the U.S. Gulf of Mexico for long-term contracts with Petroleos Mexicanos (“Pemex”).

     In December 2004, we received a commitment from Shell Exploration & Production Company for a two-year contract on the Noble Clyde Boudreaux ultra-deepwater semisubmersible. The unit began a capital upgrade program in January 2005, which upon completion will enable the unit to drill in water depths of 10,000 feet. This upgrade is expected to be completed and the unit to commence operations in the third quarter of 2006. For additional information regarding the estimated costs of this upgrade, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Capital Expenditures.”

     In October 2004, we exercised our option to purchase the Noble David Tinsley (formerly Maersk Valiant), a MODEC 300C, independent leg, cantilever jackup rig, for an exercise price of $28,400,000. In June 2003, we paid an option fee of $13,200,000 for the right to acquire the unit. Our aggregate purchase price for the rig was therefore $41,600,000. After undergoing a refurbishment and upgrade program, the unit commenced a 500-day contract in Qatar in February 2005.

     In July 2004, we exercised our option to purchase the Noble Cees van Diemen (formerly Maersk Viking), a MODEC 300C, independent leg, cantilever jackup rig, for an exercise price of $32,900,000. In June 2003, we paid an option fee of $15,000,000 for the right to acquire the unit. Our aggregate purchase price for the rig was therefore $47,900,000. After undergoing a refurbishment and upgrade program, the unit commenced an 880-day contract in Qatar in September 2004.

     In June 2004, we purchased the Noble Mark Burns (formerly Okhi), a Levingston 111-S designed independent leg jackup rig, for $29,500,000 in cash. After undergoing initial refurbishments and upgrades in the Dalian New Shipyard in Dalian, China, in December 2004 we mobilized the unit to the Middle East, where additional upgrade work is currently ongoing to include leg extension to 300 feet water depth capability, a 65 foot cantilever, a third mud pump and quarters expansion for 160 personnel. The unit has a letter of intent for a 475-day contract in Qatar following completion of its upgrade scheduled for the third quarter of 2005.

     We continued the development of our technology initiatives in 2004. We installed aluminum alloy riser on the Noble Roger Eason drillship in Brazil during its upgrade in 2004. We had previously successfully installed

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aluminum alloy riser on the Noble Leo Segerius drillship in Brazil and the Noble Therald Martin semisubmersible in the U.S. Gulf of Mexico, with further installation planned on the Noble Lorris Bouzigard semisubmersible. During 2004, we continued to test various components of our Well Director^TM automatic rotary steerable system to ensure its robustness and reliability prior to its full commercialization. We drilled additional test wells for customers using the system in 2004 and anticipate it will become fully commercial during 2005. We also continue to seek additional opportunities to utilize or license our drilling products and software designed to increase drilling efficiency. These efforts may be done solely by Noble or through joint ventures with industry partners. In addition, we continued to expand our project management and engineering services to international markets during 2004.

DRILLING CONTRACTS

     We typically employ each drilling unit under an individual contract. Although the final terms of the contracts are the result of our negotiations with our customers, many contracts are awarded based upon competitive bidding. Our drilling contracts generally contain the following terms:

	•	contract duration extending over a specific period of time or a period necessary to drill one or more wells (in general, we seek to have a reasonable balance of short- and long-term contracts to minimize the impact of a decline in the market, while obtaining the upside of increasing market prices in a rising market);
	•	provisions permitting early termination of the contract by the customer (i) if the unit is lost or destroyed or (ii) if operations are suspended for a specified period of time due to either breakdown of major equipment or “force majeure” events beyond our control and the control of the customer;
	•	options in favor of the customer to drill one or more additional wells, generally upon advance notice to us;
	•	payment of compensation to us (generally in U.S. dollars) on a “daywork” basis, so that we receive a fixed amount for each day (“dayrate”) that the drilling unit is operating under contract (lower rates or no compensation is payable during periods of equipment breakdown and repair or adverse weather or in the event operations are interrupted by other conditions, some of which may be beyond our control);
	•	payment by us of the operating expenses of the drilling unit, including labor costs and the cost of incidental supplies; and
	•	reimbursement to us by the customer of certain “out-of-pocket” expenses paid by us for the account of the customer.

     The terms of some of our drilling contracts permit early termination of the contract by the customer, without cause, generally exercisable upon advance notice to us. The terms may also require an early termination payment by the customer. The drilling contracts for seven of our jackups contracted to Pemex as of February 28, 2005 contain provisions that allow early cancellation on five days or less notice to us without Pemex making an early termination payment.

     During times of depressed market conditions, our customers may seek to avoid or reduce their obligations under term drilling contracts or letter agreements or letters of intent for drilling contracts. A customer may no longer need a rig, due to a reduction in its exploration, development or production program, or it may seek to obtain a comparable rig at a lower dayrate.

     As of February 28, 2005, 23 of our rigs were contracted for the remainder of 2005. We anticipate that the primary terms of the current contracts on 31 of our rigs will expire at varying times in 2005, subject to options to extend in the case of 27 contracts. Our remaining rigs (excluding our three ultra-deepwater hulls in inventory, ready for upgrade) were in a shipyard for repair, refurbishment or upgrade as of February 28, 2005.

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     Many contracts allow us to recover our mobilization and demobilization costs associated with moving a drilling unit from one location to another. When market conditions require us to bear these costs, our operating margins are accordingly reduced. We cannot predict our ability to recover these costs in the future. For shorter moves such as “field moves”, our customers have generally agreed to bear the costs of moving the unit by paying us a reduced dayrate or “move rate” while the unit is being moved.

OFFSHORE DRILLING OPERATIONS

     Our offshore contract drilling operations, which accounted for approximately 91 percent, 94 percent and 95 percent of operating revenues for the years ended December 31, 2004, 2003 and 2002, respectively, are conducted worldwide. Our offshore drilling fleet consists of 60 units. For additional information on the specifications of the fleet, see “Item 2. Properties-Drilling Fleet.” Our principal regions of contract drilling operations include the Middle East, Gulf of Mexico, Mexico, the North Sea, Brazil, West Africa, India and the Mediterranean Sea. In 2004, Pemex and Petroleo Brasiliero S.A. (“Petrobras”) accounted for approximately 14 percent and 10 percent, respectively, of our total operating revenues. No other single customer accounted for more than 10 percent of our total operating revenues in 2004.

International Contract Drilling

     Our contract drilling services revenues from international sources accounted for approximately 74 percent, 73 percent and 68 percent of our total contract drilling services revenues for 2004, 2003 and 2002, respectively. In 2004, approximately 47 percent of our international contract drilling services revenues was derived from contracts with government-owned companies, 43 percent was derived from contracts with companies having equity market capitalization greater than $4 billion (“large cap companies”), and the remaining 10 percent was derived from other independent operators.

Domestic Contract Drilling

     Contract drilling services revenues generated in the U.S. accounted for approximately 26 percent, 27 percent and 32 percent of our total contract drilling services revenues for 2004, 2003 and 2002, respectively. In 2004, approximately 72 percent of our domestic contract drilling revenues was derived from contracts with large cap companies and the remaining 28 percent was derived from contracts with other independent operators.

Labor Contracts

     Our offshore operations also include services we perform under labor contracts for drilling and workover activities covering 13 rigs operating in the U.K. North Sea and two rigs under a labor contract (the “Hibernia Project”) off the east coast of Canada. These rigs are not owned or leased by us. During 2004, we commenced a three-year contract with Apache North Sea Limited to take over the provision of drilling and maintenance services on its Forties Field covering five platforms and a labor contract for the BP Clair Platform in the North Sea.

     Under our labor contracts, we provide the personnel necessary to manage and perform the drilling operations from drilling platforms owned by the operator. With the exception of the Hibernia Project, which is operated under a five-year agreement that expires in 2007, our labor contracts are generally renewable on an annual basis.

TECHNOLOGY, ENGINEERING SERVICES AND PROJECT MANAGEMENT

     Our technology initiative focuses on the design and development of drilling products, drilling-related software programs, technical solutions to enhance drilling efficiency, and applications that allow us to drill in deeper water depths with less capital investment. In addition, we provide well site management, project management and engineering services.

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COMPETITION AND RISKS

     The contract drilling industry is a highly competitive and cyclical business characterized by high capital and maintenance costs. Although demand for our services improved throughout 2004, we believe that competition for drilling contracts will continue to be highly competitive for the foreseeable future. Certain competitors may have access to greater financial resources than we do.

     Competition in contract drilling involves numerous factors, including price, rig availability and suitability, experience of the workforce, efficiency, condition of equipment, operating integrity, reputation, industry standing and customer relations. We believe that we compete favorably with respect to all of these factors. Competition is primarily on a regional basis and may vary significantly by region at a particular time. Demand for offshore drilling equipment also depends on the exploration and development programs of oil and gas producers, which in turn are influenced by the financial condition of such producers, by general economic conditions and prices of oil and gas, and, from time to time, by political considerations and policies.

     We follow a policy of keeping our equipment well maintained and technologically competitive. However, our equipment could be made obsolete by the development of new techniques and equipment. In addition, industry-wide shortages of supplies, services, skilled personnel and equipment necessary to conduct our business occur from time to time. We cannot assure you that any such shortages experienced in the past would not occur again or that any shortages, to the extent currently existing, will not continue or worsen in the future.

     Our results of operations depend on the levels of activity in offshore oil and gas exploration, development and production in markets worldwide. Historically, oil and gas prices and market expectations of potential changes in these prices have significantly affected that level of activity. Generally speaking, higher oil and natural gas prices or our customers’ expectations of higher prices result in a greater demand for our services. These prices are extremely volatile. Despite favorable oil prices in 2004, drilling activity in certain international markets, which are influenced more by oil prices than natural gas prices, was generally weaker in 2004 as compared to 2003 and 2002. We believe that operators in these international markets have been reluctant to increase drilling activity due to the uncertainty surrounding the worldwide economy, the political unrest in the Middle East (including the military action in Iraq), Nigeria and Venezuela, and difficulties in obtaining funding from government-affiliated oil companies. However, drilling activity in the North Sea and West Africa began to improve in the latter part of 2004, while remaining strong in other international markets in which we operate, including the Middle East, Mexico and Brazil.

     Natural gas prices during 2004 averaged $6.13 per thousand cubic feet (source: average Henry Hub closing bidweek price). Although natural gas prices in 2004 were 12 percent higher than 2003, and significantly higher than historical prices, operators generally did not significantly increase drilling activities in the U.S. Gulf of Mexico in water depths applicable to jackups and submersibles until the second half of 2004 due principally to a lack of economically viable drilling prospects and uncertainty surrounding the worldwide economy. Drilling activity levels in water depths applicable to semisubmersibles also began to improve during the second half of 2004.

     Demand for drilling services depends on a variety of economic and political factors, including worldwide demand for oil and gas, the ability of the Organization of Petroleum Exporting Countries (“OPEC”) to set and maintain production levels and pricing, the level of production of non-OPEC countries and the policies of the various governments regarding exploration and development of their oil and gas reserves. We believe that a significant decrease from recent historical average oil and gas prices could depress the level of exploration and production activity and result in a corresponding decline in demand for our services.

     For the foregoing reasons, we cannot predict the future level of demand for our drilling services or future conditions in the offshore contract drilling industry.

     Our operations are subject to the many hazards inherent in the drilling business, including blowouts, cratering, fires and collisions or groundings of offshore equipment. In addition, our operations are subject to damage or loss from adverse weather and seas. These hazards could cause personal injury and loss of life, suspend drilling operations or seriously damage or destroy the property and equipment involved and, in addition to causing environmental damage, could cause substantial damage to oil and natural gas producing formations. Although we

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maintain insurance against many of these hazards, our insurance is subject to deductibles. It also excludes certain matters from coverage, such as loss of earnings on certain rigs. Also, we generally obtain indemnification from our customers for environmental damage with respect to offshore drilling.

     Our international operations are also subject to certain political, economic and other uncertainties including, among others, risks of war, terrorism and civil disturbances, expropriation, nationalization, renegotiation or modification of existing contracts, taxation policies, foreign exchange restrictions, international monetary fluctuations and other hazards arising out of foreign governmental sovereignty over certain areas in which we conduct operations. We have sought to obtain, where economical, insurance against certain political risks. However, we cannot assure you that this insurance will always be available to us or, if available, will cover all losses that we may incur in respect of foreign operations.

GOVERNMENTAL REGULATION AND ENVIRONMENTAL MATTERS

     Many aspects of our operations are affected by domestic and foreign political developments and are subject to numerous governmental regulations that may relate directly or indirectly to the contract drilling industry. The regulations applicable to our operations include provisions that regulate the discharge of materials into the environment or require remediation of contamination under certain circumstances. Generally, these environmental laws and regulations impose “strict liability”. This means that we could be liable without regard to our negligence or fault. Such environmental laws and regulations may expose us to liability for the conduct of, or conditions caused by, others, or for any of our acts, even if they complied with all applicable laws in effect at the time we acted.

     The U.S. Oil Pollution Act of 1990 (“OPA `90”) and regulations thereunder impose certain additional operational requirements on our domestic offshore rigs and govern liability for leaks, spills and blowouts involving pollutants. Regulations under OPA `90 require owners and operators of rigs in United States waters to maintain certain levels of financial responsibility. We monitor these regulations and do not believe that they are likely to have a material adverse effect on our financial condition or results of operations. We have made and will continue to make expenditures to comply with environmental requirements. To date we have not expended material amounts in order to comply and we do not believe that our compliance with such requirements will have a material adverse effect upon our results of operations or competitive position or materially increase our capital expenditures. Although these requirements impact the energy and energy services industries, generally they do not appear to affect us any differently or to any greater or lesser extent than other companies in the energy services industry.

     The modification of existing laws or regulations or the adoption of new laws or regulations curtailing exploratory or developmental drilling for oil and gas for economic, environmental or other reasons could materially and adversely affect our operations by limiting drilling opportunities.

EMPLOYEES

     At December 31, 2004, the Company employed approximately 5,300 persons, including persons engaged through labor contractors or agencies. Of the 5,300 persons, approximately 80 percent were engaged in international operations and approximately 20 percent were engaged in domestic operations. We are not a party to any collective bargaining agreements that are material. We consider our employee relations to be satisfactory.

FINANCIAL INFORMATION ABOUT FOREIGN AND DOMESTIC OPERATIONS

     Information regarding our operating revenues and identifiable assets attributable to each of our geographic areas of operations for the last three fiscal years is presented in Note 16 to our consolidated financial statements included in this Annual Report on Form 10-K.

AVAILABLE INFORMATION

     Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 are available free of charge at our internet website at http://www.noblecorp.com. These filings are also available to the public at the Securities and Exchange Commission’s (“SEC”) Public Reference Room at 450 Fifth

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Street, NW, Washington, DC 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. Electronic filings with the SEC are also available on the SEC internet website at http://www.sec.gov.

     We also make available on our website the following:

	•	Charters for the Audit, Compensation, Nominating and Corporate Governance, and Finance Committees of our board of directors;
	•	Our code of business conduct and ethics;
	•	Our Memorandum and Articles of Association; and
	•	Methods for contacting members of our board of directors.

     Printed copies of our committee charters and code of business conduct and ethics are available in print to any member who requests them.

ITEM 2. PROPERTIES.

DRILLING FLEET

     Our offshore drilling rig fleet consists of 60 units composed of 13 semisubmersibles (including five Noble EVA-4000™ semisubmersibles and four ultra-deepwater hulls), three drillships, 41 jackup rigs and three submersibles. The rig count includes one drillship and one jackup unit in which we have partial ownership interests through joint ventures and one jackup rig operated pursuant to a lease (“bareboat charter”) agreement. Each type of rig is described further below. There are several factors that determine the type of rig most suitable for a particular job, the most significant of which include the water depth and bottom conditions at the proposed drilling location, whether the drilling is being done over a platform or other structure, and the intended well depth.

Semisubmersibles

     Our semisubmersible fleet consists of 13 units. Among the 13 are five units that have been converted to Noble EVA-4000™ semisubmersibles and three Friede & Goldman 9500 Enhanced Pacesetter semisubmersibles (two of which require substantial capital expenditure upgrades to place in operational condition). Also included in this fleet are two Pentagone 85 semisubmersibles, two Bingo 9000 baredeck hulls, and one semisubmersible capable of operating in harsh environments. Semisubmersibles are floating platforms which, by means of a water ballasting system, can be submerged to a predetermined depth so that a substantial portion of the hull is below the water surface during drilling operations. These units maintain their position over the well through the use of either a fixed mooring system or a dynamic positioning system and can drill in many areas where jackup rigs can also drill. However, semisubmersibles normally require water depth of at least 200 feet in order to conduct operations. Our semisubmersibles are designed to work in water depths of up to 10,000 feet, depending on the unit. Semisubmersibles are typically more expensive to construct and operate than jackup rigs. One of our Friede & Goldman 9500 Enhanced Pacesetter semisubmersibles, the Noble Clyde Boudreaux, received a commitment in December 2004 from Shell Exploration & Production Company for a two-year contract. Upon completion of capital upgrades, which are estimated to be completed in the third quarter of 2006, the unit will be capable of drilling in water depths up to 10,000 feet.

     We have extended the water depth capability of certain of our semisubmersibles and dynamically positioned drillships discussed below by the deployment of our proprietary aluminum alloy riser (see “Item 1. Business-Business Development During 2004”).

Dynamically Positioned Drillships

     We have three dynamically positioned drillships in the fleet. Drillships are ships that are equipped for drilling and are typically self-propelled. Our drillships are positioned over the well through the use of a computer controlled dynamic positioning system. Our two wholly-owned drillships, the Noble Leo Segerius and Noble Roger Eason, are capable of drilling in water depths up to 5,900 feet and 7,200 feet, respectively. The Noble Muravlenko,

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in which we own an 82 percent interest through a joint venture, is capable of drilling in water depths up to 4,800 feet.

Jackup Rigs

     We have 41 jackup rigs in the fleet, including one in which we own a 50 percent interest through a joint venture and one that we operate pursuant to a bareboat charter agreement. Jackup rigs are mobile, self-elevating drilling platforms equipped with legs which can be lowered to the ocean floor until a foundation is established to support the drilling platform. The rig hull includes the drilling rig, jacking system, crew quarters, loading and unloading facilities, storage areas for bulk and liquid materials, helicopter landing deck and other related equipment. All of our jackup rigs are independent leg (i.e., the legs can be raised or lowered independently of each other), cantilevered rigs, and the Noble Mark Burns is under conversion. We acquired the Noble Mark Burns in June 2004 and are upgrading the unit to 300 feet water depth capability, a 65 foot cantilever, a third mud pump, and quarters expansion for 160 personnel. A cantilevered jackup has a feature that permits the drilling platform to be extended out from the hull, allowing it to perform drilling or workover operations over pre-existing platforms or structures. Moving a rig to the drill site involves jacking up its legs until the hull is floating on the surface of the water. The hull is then towed to the drill site by tugs and the legs are jacked down to the ocean floor. The jacking operation continues until the hull is raised out of the water and drilling operations are conducted with the hull in its raised position. Our jackup rigs are capable of drilling to a maximum depth of 25,000 feet in water depths ranging between eight and 390 feet, depending on the jackup rig.

Submersibles

     We have three submersibles in the fleet. Submersibles are mobile drilling platforms which are towed to the drill site and submerged to drilling position by flooding the lower hull until it rests on the sea floor, with the upper deck above the water surface. Our submersibles are capable of drilling to a maximum depth of 25,000 feet in water depths ranging between 12 and 85 feet, depending on the submersible.

     The following table sets forth certain information concerning our drilling rig fleet at February 28, 2005. The table does not include any rigs owned by operators for which we had labor contracts or letters of intent as of February 28, 2005. We operate and, unless otherwise indicated, own all of the rigs included in the table. All of our rigs are equipped with top drives.

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Drilling Fleet

See footnotes on the following page.

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Footnotes to Drilling Fleet

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FACILITIES

     Our principal executive offices are located in Sugar Land, Texas, and are leased through June 2011. We also lease administrative and marketing offices, and sites used primarily for storage, maintenance and repairs for drilling rigs and equipment, in Zug, Switzerland; Sugar Land, Texas; New Orleans, Louisiana; Leduc, Alberta and St. John’s, Newfoundland, Canada; Lagos and Port Harcourt, Nigeria; Aberdeen, Scotland; Stavanger, Norway; Ciudad Ojeda, Venezuela; Del Carmen, Mexico; Doha, Qatar; Abu Dhabi and Dubai, U.A.E.; Beverwijk and Den Helder, The Netherlands; Macae, Brazil; Celle, Germany; Moscow, Russia; and Esjberg, Denmark. We own certain tracts of land, including office and administrative buildings and warehouse facilities in Bayou Black, Louisiana and Aberdeen, Scotland.

ITEM 3. LEGAL PROCEEDINGS.

     In August 2004, an indirect, wholly-owned subsidiary of Noble was served as a named defendant in two lawsuits filed in the Circuit Courts of the State of Mississippi involving numerous other companies (not affiliated with Noble) as co-defendants. In December 2004, such subsidiary was served as a named defendant in a third lawsuit filed in Mississippi Circuit Court. The lawsuits seek an unspecified amount of monetary damages on behalf of approximately 130 named individuals alleging personal injury or death, including claims under the Jones Act, purportedly resulting from exposure to asbestos on drilling rigs and associated facilities during the period 1965 through 1986. The lawsuits are in preliminary stages and we have not confirmed the number of plaintiffs, if any, that were employed by our subsidiary or otherwise associated with our drilling operations during the relevant period. We intend to defend vigorously against the litigation, and based on information currently available, we do not believe the resolution of these lawsuits will have a material adverse effect on our financial position, results of operations or cash flows.

     Noble Asset Company Limited (“NACL”), a wholly-owned, indirect subsidiary of Noble, was named one of 21 parties served a Show Cause Notice issued by the Commissioner of Customs (Prev.), Mumbai, India in August 2003. The Show Cause Notice concerns alleged violations of Indian Customs laws and regulations regarding one of our jackup drilling rigs. The Commissioner alleges certain violations to have occurred before, at the time of, and after NACL acquired the rig from the rig’s previous owner. We maintain that NACL has acted in accordance with all Indian Customs laws and regulations and believe the Show Cause Notice is without merit as against NACL. In the purchase agreement for the rig, NACL received contractual indemnification against liability for Indian customs duty from the rig’s previous owner. In connection with the export of the rig from India in 2001, NACL posted a bank guarantee in the amount of $3,300,000 and a customs bond in the amount of $21,340,000, both of which remain in place. NACL filed its initial replies to the Show Cause Notice in December 2003. NACL appeared through counsel before the Commissioner in September 2004 and made oral arguments and written submissions. The Commissioner has not ruled to date. We do not believe the resolution of this matter will have a material adverse effect on our financial position, results of operations or cash flows.

     We are a defendant in certain claims and litigation arising out of operations in the normal course of business. In the opinion of management, uninsured losses, if any, will not be material to our financial position, results of operations or cash flows.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

     Not applicable.

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EXECUTIVE OFFICERS OF THE REGISTRANT

     The following table sets forth certain information as of March 1, 2005 with respect to our executive officers:

     James C. Day has served as Chairman of the Board of Noble since October 22, 1992 and as Chief Executive Officer since January 1, 1984. He served as President of Noble Drilling from January 1, 1984 to January 1, 1999 before reassuming the office of President of Noble effective March 1, 2005. From January 1983 until his election as President and Chief Executive Officer, Mr. Day served as Vice President of Noble Drilling. Prior to 1983, Mr. Day served as Vice President and Assistant Secretary of Noble Affiliates, Inc. He has been a director of Noble since 1984. Mr. Day is also a director of two public companies, Global Industries, Ltd. and ONEOK, Inc., and a trustee of The Samuel Roberts Noble Foundation, Inc., a not-for-profit corporation.

     Mark A. Jackson has served as Senior Vice President, Chief Financial Officer, Treasurer and Controller of Noble since September 1, 2000. Mr. Jackson was named Chief Operating Officer effective March 1, 2005. From May 1999 to August 2000, Mr. Jackson served as Executive Vice President and Chief Financial Officer for Santa Fe Snyder Corporation, an oil and gas exploration and production company. From August 1997 to May 1999, he served as Senior Vice President and Chief Financial Officer of Snyder Oil Corporation, an oil and gas exploration and production company. Prior to August 1997, Mr. Jackson served consecutively in the positions of Vice President & Controller, Vice President - Finance and Vice President & Chief Financial Officer of Apache Corporation, an oil and gas exploration and production company, beginning in 1988.

     Danny W. Adkins has served as Senior Vice President — Operations of Noble Drilling since November 1, 2003. Prior to that, he held the same position with Noble Drilling International (Cayman) Ltd. since August 2000. From March 1997 to August 2000, Mr. Adkins served consecutively as Vice President — Engineering and Senior Vice President — Engineering for Noble Drilling Services Inc. From September 1994 to March 1997, he served as Vice President — Operations for Noble Drilling Services Inc. Prior to September 1994, Mr. Adkins served consecutively in the positions of Manager of Engineering and Vice President — Operations for a predecessor subsidiary of Noble, beginning in December 1990.

     Julie J. Robertson has served as Senior Vice President — Administration of Noble since July 2001 and as Corporate Secretary of Noble since December 1993. Ms. Robertson served as Vice President – Administration of Noble Drilling from April 1996 to July 2001. In September 1994, Ms. Robertson became Vice President — Administration of Noble Drilling Services Inc. From January 1989 to September 1994, Ms. Robertson served consecutively as Manager of Benefits and Director of Human Resources for Noble Drilling Services Inc. Prior to 1989, Ms. Robertson served consecutively in the positions of Risk and Benefits Manager and Marketing Services Coordinator for a predecessor subsidiary of Noble, beginning in 1979.

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PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

     Noble’s ordinary shares are listed and traded on the New York Stock Exchange under the symbol “NE”. The following table sets forth for the periods indicated the high and low sales prices of our ordinary shares:

     As previously reported on Form 8-K, in October 2004, Noble’s board of directors took action to modify our then existing dividend policy and institute a new policy in the first quarter of 2005 for the payment of a quarterly cash dividend. On February 4, 2005, Noble’s board of directors declared a quarterly cash dividend of $0.02 per ordinary share. This dividend was paid on March 1, 2005 to members (shareholders) of record on February 16, 2005. Prior thereto, the Company had not paid cash dividends on its equity securities since becoming a publicly held corporation in October 1985. The declaration and payment of dividends in the future are at the discretion of Noble’s board of directors and the amount thereof will depend on the Company’s results of operations, financial condition, cash requirements, future business prospects, contractual restrictions and other factors deemed relevant by Noble’s board of directors.

     At March 3, 2005, there were 1,467 record holders of ordinary shares.

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ITEM 6. SELECTED FINANCIAL DATA.

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

     The following discussion is intended to assist you in understanding our financial position as of December 31, 2004 and 2003, and our results of operations for each of the three years in the period ended December 31, 2004. You should read the accompanying consolidated financial statements and their notes in conjunction with this discussion.

EXECUTIVE OVERVIEW

     Demand for drilling services depends on a variety of economic and political factors, including worldwide demand for oil and gas, the ability of OPEC to set and maintain production levels and pricing, the level of production of non-OPEC countries and the policies of the various governments regarding exploration and development of their oil and gas reserves.

     Our results of operations depend on the levels of activity in offshore oil and gas exploration, development and production in markets worldwide. Historically, oil and gas prices and market expectations of potential changes in these prices have significantly affected that level of activity. Generally speaking, higher oil and natural gas prices or our customers’ expectations of higher prices result in a greater demand for our services. These prices are extremely volatile. Despite favorable oil prices in 2004, drilling activity in certain international markets, which are influenced more by oil prices than natural gas prices, was generally weaker in 2004 as compared to 2003 and 2002. We believe that operators in these international markets have been reluctant to increase drilling activity due to the uncertainty surrounding the worldwide economy, the political unrest in the Middle East (including the military action in Iraq), Nigeria and Venezuela, and difficulties in obtaining funding from government-affiliated oil companies. However, drilling activity in the North Sea and West Africa began to improve in the latter part of 2004, while remaining strong in other international markets in which we operate, including the Middle East, Mexico and Brazil.

     Natural gas prices during 2004 averaged $6.13 per thousand cubic feet (source: average Henry Hub closing bidweek price). Although natural gas prices in 2004 were 12 percent higher than 2003, and significantly higher than historical prices, operators generally did not significantly increase drilling activities in the U.S. Gulf of Mexico in water depths applicable to jackups and submersibles until the second half of 2004 due principally to a lack of economically viable drilling prospects and uncertainty surrounding the worldwide economy. Drilling activity levels in water depths applicable to semisubmersibles also began to improve during the second half of 2004.

     We cannot predict the future level of demand for our drilling services or future conditions in the offshore contract drilling industry. Decreases in the level of demand for our drilling services have an adverse effect on our results of operations.

     In recent years, we have focused on increasing the number of rigs in our fleet capable of ultra-deepwater offshore drilling. We have incorporated this focus into our broader, long-standing business strategy to actively expand our international and offshore deepwater capabilities through acquisitions, rig upgrades and modifications and to deploy assets in important geological areas. We have also increased the number of jackups in key international markets. Since the beginning of 2000, we have mobilized nine jackup rigs and one semisubmersible from the U.S. Gulf of Mexico to international markets. We have also added nine jackups to our international fleet through rig acquisitions during this same period. In addition, we have added two deepwater semisubmersibles to our fleet and have acquired two additional semisubmersible baredeck hulls since the beginning of 2000.

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RESULTS OF OPERATIONS

2004 Compared to 2003

     General

          Net income for 2004 was $146,086,000, or $1.09 per diluted share, on operating revenues of $1,066,231,000, compared to net income of $166,416,000, or $1.25 per diluted share, on operating revenues of $987,380,000 for 2003.

          The following table sets forth operating revenues and operating costs and expenses for each of our reportable segments (for additional information regarding our reportable segments, see Note 16 of our accompanying consolidated financial statements) for the periods indicated:

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Rig Utilization, Operating Days and Average Dayrates

     The following table sets forth the average rig utilization, operating days and average dayrates for our rig fleet for 2004 and 2003:

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International Contract Drilling Services

     The following table sets forth the operating revenues and the operating costs and expenses for our international contract drilling services segment for 2004 and 2003:

     Operating Revenues. International contract drilling services revenues increased $50,909,000 as additional operating days in our Middle East, Mexico and West Africa divisions were partially offset by weaker market conditions in the North Sea, and a shipyard project on the Noble Roger Eason drillship in Brazil. We had 1,392 additional operating days in our Middle East division due primarily to the acquisition of the Noble Gene House, Noble Charlie Yester and Noble Cees van Diemen premium jackups in July 2003, September 2003, and July 2004, respectively, the mobilization of the Noble Carl Norberg premium jackup to the Mediterranean Sea from the U.S. Gulf of Mexico in December 2003, and additional operating days on the Noble Dick Favor. The additional operating days in our Middle East division resulted in additional revenues of approximately $68,000,000. In Mexico, we experienced an additional 373 operating days due to the mobilization of three premium jackups from the U.S. Gulf of Mexico since the beginning of 2003 for long-term contracts with Pemex, which resulted in additional international contract drilling services revenues of approximately $19,000,000. An increase in activity in West Africa over the latter part of 2004 resulted in an additional 256 operating days on our jackups in the region as compared to 2003. In addition, we transferred the Noble Homer Ferrington semisubmersible to our West Africa division in July 2004 from the U.S. Gulf of Mexico for a two-year contract that commenced in November 2004. The additional operating days in West Africa resulted in additional revenues of approximately $13,000,000. The generally weaker market conditions in the North Sea resulted in lower utilization and average dayrates in 2004 for this region. Utilization in the North Sea during 2004 decreased to 91 percent from 97 percent in 2003, while our average dayrate decreased 10 percent to $52,090. The weaker market conditions in the North Sea and the shipyard project on the Noble Roger Eason decreased revenues by approximately $28,000,000 and $21,000,000, respectively. The increase in engineering, consulting and other revenue of $1,696,000 was attributable primarily to an equipment inspection fee earned on a per day basis by the Noble Homer Ferrington as part of the rig’s preparations for its long-term contract in Nigeria.

     Since September 2002, we have mobilized a total of seven jackups from the U.S. Gulf of Mexico to Mexico for long-term contracts with Petroleos Mexicanos (“Pemex”), including three since the beginning of 2003. The mobilization of these jackup rigs was pursuant to our long-standing business strategy of deploying our assets in important geological regions. We believe the long-term financial returns for our jackup rigs will be higher in international regions due to relatively fewer quality drilling prospects in the U.S. Gulf of Mexico at water depths applicable to these units. As a result, we made the strategic decision to mobilize these units to Mexico for long-term contracts. Following the completion of its contract in early January 2005, we mobilized the Noble Lewis Dugger from Mexico to the U.S. Gulf of Mexico for upgrades and refurbishments. Following this shipyard work, we plan to mobilize the rig back to Mexico if successful on a recent bid to Pemex for a one-year contract that is expected to commence in May 2005.

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     Nigeria traditionally has had the largest concentration of drilling rigs in West Africa. Demand in Nigeria began to decline in the latter part of 2002 due to political unrest attributable to elections and strikes. Although this unrest declined towards the end of 2003, demand did not improve as our customers were in the process of obtaining approval for projects from the government-affiliated oil companies. Due to geology which is favorable for offshore exploration and production, we believe the prospects for drilling activity in West Africa are good and that our operations in the region will provide financial returns over time which are comparable to other key international regions, and as a result, we have kept our six jackups in this market. Utilization on our six jackups in West Africa improved during 2004, especially over the second half of the year. By the middle of the fourth quarter of 2004, all six of our jackups were under contract, with five contracted through 2005. In November 2004, the Noble Homer Ferrington semisubmersible commenced a two-year contract with ExxonMobil in Nigeria. This unit previously operated in the U.S. Gulf of Mexico. We believe that the long-term contracts initiated during 2004 for our jackups and the Noble Homer Ferrington semisubmersible support our favorable outlook for this region.

     We believe that the weaker market conditions in the North Sea during 2004 were attributable to the gradual maturing of the North Sea basin. We also believe that improvement in dayrates in this region will be driven by the independent operators, who historically have been more aggressive than major oil and gas companies in developing smaller reserve targets. Market conditions in the North Sea improved during the second half of 2004, as the supply and demand of rigs in the region came closer into balance. All of our units in the region are currently operating and dayrates have continued to strengthen on recent contracts. In Brazil, the Noble Roger Eason drillship was in the shipyard for all of 2004. We performed regulatory maintenance and upgrades to the unit, including water depth increase to 7,200 feet, which we recently completed. The unit has a 700-day contract with Petrobras at a dayrate of $96,250, plus the opportunity for a performance bonus, which we anticipate will commence in March 2005.

     Operating Costs and Expenses. International contract drilling services expenses increased $56,866,000 due to the additional operating days in our Middle East, Mexico and West Africa divisions following the acquisition of five international jackups since July 2003, the mobilization of four premium jackups out of the U.S. Gulf of Mexico to international locations since the beginning of 2003, and the transfer of the Noble Homer Ferrington semisubmersible to our West Africa division in July 2004 for a contract that commenced in November 2004. In addition, we performed maintenance projects on our three drillships in Brazil, including the Noble Roger Eason upgrade project that we recently completed, and we experienced higher labor costs in all our international regions. Approximately two-thirds of the increase in our international contract drilling services expenses was attributable to the additional operating days. Engineering, consulting and other expenses in our international contract drilling services segment decreased $1,636,000 due to a lower minority interest amount related to our Noble Muravlenko drillship. The Noble Muravlenko, in which we own an 82 percent interest, incurred additional downtime in 2004, as well as the rig’s drydocking in late July 2004, resulting in a reduced minority interest amount. Depreciation expense increased $22,024,000 due to the rig acquisitions, mobilization of jackup rigs to international locations, and transfer of the Noble Homer Ferrington to our West Africa division discussed above. See the discussion below under “Other Items” regarding selling, general and administrative expenses.

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Domestic Contract Drilling Services

     The following table sets forth the operating revenues and the operating costs and expenses for our domestic contract drilling services segment for 2004 and 2003:

     Operating Revenues. Domestic contract drilling services revenues decreased $3,098,000 due to a lower average dayrate on our semisubmersibles and fewer operating days on our jackups following the mobilization of four premium jackups out of the U.S. Gulf of Mexico to international locations since the beginning of 2003. These items were mostly offset by a higher average dayrate on our jackups, higher utilization and average dayrates on our submersibles, and additional operating days on our semisubmersibles. Market conditions for jackups and submersibles in the U.S. Gulf of Mexico improved during 2004 as the supply of such rigs has come closer into balance with demand following the industry’s mobilization of jackup rigs out of this region for international opportunities and a moderate increase in demand. Utilization of our submersibles increased to 94 percent from 77 percent in 2003, while the average dayrate on these units increased 28 percent to $25,840. Our submersibles contributed additional revenues of $14,000,000 in 2004. Likewise, the average dayrate on our jackup rigs increased 51 percent, although the impact on our domestic contract drilling services revenues was mostly offset by 431 fewer operating days due to the mobilization of the three premium jackups to Mexico for long-term contracts with Pemex and the mobilization of another premium jackup to the Mediterranean Sea during 2003. The Noble Homer Ferrington was transferred to our West Africa division in July 2004 and began preparations for a two-year contract in Nigeria. The average dayrate on our semisubmersibles with water depth ratings of 6,000 feet or greater decreased 15 percent, which reduced revenues by approximately $28,000,000, due to certain units operating on the spot-rate market with lower average dayrates than those earned while under previous long-term contracts. However, additional operating days on our semisubmersibles, primarily the Noble Lorris Bouzigard and Noble Therald Martin, resulted in additional revenues of approximately $13,000,000. The decrease in engineering, consulting and other revenues of $7,680,000 was attributable to the sale of our interest in certain deepwater oil and gas properties during the fourth quarter of 2003.

     The demand for semisubmersibles in the U.S. Gulf of Mexico began to improve during the latter part of 2004, with significant dayrate increases and longer terms on contracts for these units as compared to earlier in the year. This improvement has been the result of increased demand for deepwater semisubmersibles due to operators’ increased exploration spending and upcoming development projects in the region. The supply of these units is currently short of projected demand for the next two to three years as operators look to obtain the rig capacity necessary to meet their long-term exploration and development plans. In December 2004, we received a commitment from Shell Exploration & Production Company for a two-year contract on the Noble Clyde Boudreaux, an ultra-deepwater semisubmersible that upon completion of its upgrade will be capable of drilling in water depths of 10,000 feet. This upgrade is expected to be completed and the unit to commence operations in the third quarter of 2006. In addition to the Noble Clyde Boudreaux, we have three ultra-deepwater hulls in inventory, ready for upgrade. Notwithstanding the recent improvement in both the deepwater and shallow water markets in the U.S.

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Gulf of Mexico, the mobilization of the Noble Homer Ferrington semisubmersible and four premium jackups from the U.S. Gulf of Mexico to international locations was pursuant to our long-standing business strategy of deploying our assets in important geological regions as described earlier.

     Operating Costs and Expenses. Domestic contract drilling services expenses increased $604,000 due to a $9,000,000 pre-tax charge related to costs incurred in 2004 to repair damage to three of our semisubmersibles in the U.S. Gulf of Mexico as a result of Hurricane Ivan. Excluding this charge, domestic contract drilling services expenses decreased $8,396,000 due to the mobilization of four jackup rigs from the U.S. Gulf of Mexico to international locations and the transfer of the Noble Homer Ferrington semisubmersible to our West Africa division, partially offset by increased costs attributable to the activation of the Noble Lorris Bouzigard and Noble Therald Martin semisubmersibles, which were placed into service in March 2003 and November 2003, respectively. The mobilization of the four jackup rigs and transfer of the Noble Homer Ferrington semisubmersible to international locations reduced domestic contract drilling expenses by approximately $16,000,000, whereas the activation of the Noble Lorris Bouzigard and Noble Therald Martin increased contract drilling expenses by approximately $8,000,000. The lower engineering, consulting and other expenses of $2,392,000 were due to the sale of our interests in certain deepwater oil and gas properties during the fourth quarter of 2003. Depreciation expense decreased $1,907,000 due to the mobilization of four premium jackups out of the U.S. Gulf of Mexico and transfer of the Noble Homer Ferrington to our West Africa division, which reduced depreciation expense by approximately $7,000,000, partially offset by additional depreciation of approximately $5,000,000 attributable to the activation of the Noble Lorris Bouzigard and Noble Therald Martin semisubmersibles. See the discussion below under “Other Items” regarding selling, general and administrative expenses.

  Engineering & Consulting Services

     The following table sets forth the operating revenues and the operating costs and expenses for our engineering and consulting services segment for 2004 and 2003:

     Operating Revenues. Excluding reimbursables, operating revenues for our engineering and consulting services segment increased $4,277,000 due principally to the sale of a license of our OptiDrill^TM drilling efficiency technology during 2004 for $3,000,000 and additional project management engagements.

     Operating Costs and Expenses. Excluding reimbursables, operating costs and expenses for our engineering and consulting services segment decreased $1,379,000 due to fewer joint industry research projects conducted in 2004 by our Noble Technology Services Division, mostly offset by additional project management engagements in 2004.

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  Other

     The following table sets forth the operating revenues and the operating costs and expenses for our other services for 2004 and 2003:

     Operating Revenues. Revenues from our labor contract drilling services increased $22,835,000 due to additional operating days in the North Sea, mostly attributable to the start of a new labor contract for Apache North Sea Limited under which we commenced operations on three platforms in the Forties Field during 2004. The additional operating days in the North Sea represented approximately 90 percent of the increase in our labor contract drilling services revenues in 2004. Foreign exchange fluctuations related to our operations in Canada on the Hibernia project also resulted in higher revenues. We are paid for this work in Canadian dollars, and the Canadian dollar was stronger relative to the U.S. dollar in 2004 than in 2003. In addition, contractual provisions covering the Hibernia project allowed for increases in the labor, maintenance and administrative portions of the dayrate on the project during 2004. Engineering, consulting and other revenues increased $3,892,000 due to increased activity on an engineering services engagement in the North Sea.

     Operating Costs and Expenses. Excluding reimbursables, operating costs and expenses for our other services increased $25,003,000 due to the additional labor contract operating days in the North Sea, the stronger Canadian dollar, higher labor, maintenance and administrative costs related to our Hibernia project in Canada, and the increased activity on an engineering services engagement in the North Sea. The additional operating days on our North Sea labor contracts and increased activity on the engineering services engagement represented approximately 75 percent and 15 percent, respectively, of the increase in our other services operating costs and expenses.

  Other Items

     Selling, General and Administrative Expenses. Selling, general and administrative (“SG&A”) expenses increased $7,080,000 due to additional professional fees associated with compliance under the requirements of the Sarbanes-Oxley Act of 2002, additional stock-based compensation expense, higher insurance premiums for corporate-related policies and additional pension expense. The additional professional fees related to the Sarbanes-Oxley Act of 2002 was the largest individual factor in our higher SG&A expenses in 2004, representing nearly 30 percent of the increase.

     Gain on Sale of Property and Equipment. In 2003, we sold our interest in a deepwater oil and gas property in the U.S. Gulf of Mexico to ENI Petroleum for $5,200,000 in cash. We realized a gain of $3,472,000 upon the sale of our interest in this property. No sales of oil and gas properties were made in 2004.

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     Interest Expense. Interest expense decreased $5,902,000 due to the continued retirement of debt since the beginning of 2003. Since January 1, 2003, we have made repayments of long-term debt totaling $158,513,000, including $77,933,000 in 2004.

     Other, net. Other, net increased $2,897,000 due to additional equity in income from our 50 percent equity interest in Noble Crosco Drilling Ltd., a joint venture which owns the Panon jackup rig, and additional interest income earned on our cash and investments in marketable debt securities due to higher interest rates in 2004 than in 2003. The Panon was in the shipyard for two months in 2003, whereas the rig operated the full year in 2004.

     Income Tax Provision. Income tax provision decreased $4,837,000 due to lower pretax earnings and the favorable resolution of income tax audits in 2004, which resulted in a lower effective tax rate in 2004 than in 2003. Excluding the impact of the favorable resolution of income tax audits, the effective tax rate was 15 percent in 2004 compared to 11 percent in 2003. This higher effective tax rate was a result of additional earnings during 2004 from rigs owned by U.S. subsidiaries which were operating in Mexico, India and the Mediterranean Sea and reduced earnings from our Brazil and North Sea divisions, which have lower effective tax rates.

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2003 Compared to 2002

  General

     Net income for 2003 was $166,416,000, or $1.25 per diluted share, on operating revenues of $987,380,000, compared to net income of $209,503,000, or $1.57 per diluted share, on operating revenues of $990,248,000 for 2002.

     The following table sets forth operating revenues and operating costs and expenses for each of our reportable segments (for additional information regarding our reportable segments, see Note 16 of our accompanying consolidated financial statements) for the periods indicated:

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  Rig Utilization, Operating Days and Average Dayrates

     The following table sets forth the average rig utilization, operating days and average dayrates for our rig fleet for 2003 and 2002: