Exhibit 99.1

FOR IMMEDIATE RELEASE		CONTACT: Les Van Dyke Director, Investor Relations (281) 492-5370

DIAMOND OFFSHORE ANNOUNCES
SECOND QUARTER 2011 RESULTS

Houston, Texas, July 21, 2011 — Diamond Offshore Drilling, Inc. (NYSE:DO) today reported net income for the second quarter of 2011 of $266.6 million, or $1.92 per share on a diluted basis, compared with net income of $224.4 million, or $1.61 per share on a diluted basis, in the same period a year earlier. Revenues in the second quarter of 2011 were $889.5 million, compared with revenues of $822.6 million for the second quarter of 2010.

For the six months ended June 30, 2011, the Company reported net income of $517.2 million, or $3.72 per share on a diluted basis, compared with net income of $515.2 million, or $3.70 per share on a diluted basis, for the same period in 2010. Revenue for the six months ended June 30, 2011 was $1.7 billion, essentially identical with $1.7 billion for the first six months of 2010.

In addition, in the past 45 days the Company has put in place 10 new agreements that are expected to generate combined maximum total revenue of approximately $1 billion and represent over 14 years of contract drilling backlog. Significant among these agreements:

	•		Petrobras has given notice of its intent to exercise a right to convert the Ocean Baroness and Ocean Valor contracts from three years to five years, in return for which the Company will lower each dayrate by $10,000. The two rigs are expected to earn additional combined maximum total revenue of approximately $500 million, excluding any potential performance bonus payments.
	•		The Company has reached agreement with OGX to extend both the Ocean Quest and Ocean Star contracts in Brazil by one year. The extensions are expected to result in combined maximum total revenue of approximately $200 million.
	•		The Ocean Yorktown has received a letter of award for a 930-day contract with Pemex in Mexico commencing mid-November 2011 that is expected to earn maximum total revenue of approximately $171 million. The unit is currently under contract to Petrobras in Brazil, but under mutually agreed terms will demobe to Mexico as soon as practical. The remaining days of the Yorktown contract with Petrobras will be added to the Ocean Concord contract.
	•		The jack-up Ocean Summit has received a letter of award for a 985-day contract with Pemex in Mexico commencing in late February 2012 that is expected to earn maximum total revenue of approximately $85 million.

•

The jack-up Ocean Titan has received a letter of award for a 777-day contract with Pemex in Mexico commencing in mid-November 2011 that is expected to earn maximum total revenue of approximately $80 million.

Diamond Offshore provides contract drilling services to the energy industry and is a leader in deepwater drilling.

Maximum contract revenue as stated above assumes 100% rig utilization. Generally, rig utilization rates approach 95-98% during contracted periods; however, utilization rates can be adversely impacted by additional downtime due to unscheduled repairs, maintenance and weather.

Additional information on Diamond Offshore and access to the Company’s SEC filings is available on the Internet at www.diamondoffshore.com.

As previously announced, Diamond Offshore will provide a simulcast and rebroadcast of its second quarter 2011 earnings release conference call. The live broadcast of our quarterly conference call will be available online at www.diamondoffshore.com on July 21, 2011 beginning at 9:00 a.m. Central Daylight Time. The online replay will follow immediately and continue for the remainder of the calendar quarter after the original call. Please go to the web site at least 15 minutes before the broadcast to register, download and install any necessary audio software.

Statements contained in this press release which are not historical facts are “forward-looking statements” within the meaning of the federal securities laws. Forward-looking statements are inherently uncertain and subject to a variety of risks that could cause actual results to differ materially from those expected by management of the Company. A discussion of the important risk factors and other considerations that could materially impact these matters as well as the Company’s overall business and financial performance can be found in the Company’s reports filed with the Securities and Exchange Commission and readers of this release are urged to review those reports carefully when considering these forward-looking statements. Copies of these reports are available through the Company’s website www.diamondoffshore.com. Given these risk factors, investors and analysts should not place undue reliance on forward-looking statements. Any such forward-looking statements speak only as of the date of this press release. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement to reflect any change in the Company’s expectations with regard thereto or any change in events, conditions or circumstances on which any forward-looking statement is based.

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DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share data)

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2011				2010				2011				2010
Revenues:
Contract drilling		$	869,646			$	811,739			$	1,658,519			$	1,656,177
Revenues related to reimbursable expenses			19,850				10,864				37,366				26,107
Total revenues			889,496				822,603				1,695,885				1,682,284
Operating expenses:
Contract drilling, excluding depreciation			388,006				351,769				750,370				657,996
Reimbursable expenses			19,287				10,379				36,237				25,084
Depreciation			101,175				100,746				202,348				198,148
General and administrative			16,372				16,849				34,097				33,503
Bad debt recovery			(1,700	)			(2,798	)			(10,147	)			(3,898	)
Gain on disposition of assets			(1,240	)			(149	)			(3,881	)			(1,033	)
Total operating expenses			521,900				476,796				1,009,024				909,800
Operating income			367,596				345,807				686,861				772,484
Other income (expense):
Interest income			1,091				477				1,541				1,759
Interest expense			(22,226	)			(21,333	)			(44,270	)			(43,654	)
Foreign currency transaction loss			(1,555	)			(3,991	)			(3,161	)			(3,530	)
Other, net			(880	)			(34	)			(96	)			(121	)
Income before income tax expense			344,026				320,926				640,875				726,938
Income tax expense			(77,440	)			(96,533	)			(123,677	)			(211,692	)
Net Income		$	266,586			$	224,393			$	517,198			$	515,246
Income per share:
Basic		$	1.92			$	1.61			$	3.72			$	3.71
Diluted		$	1.92			$	1.61			$	3.72			$	3.70
Weighted average shares outstanding:
Shares of common stock			139,027				139,026				139,027				139,026
Dilutive potential shares of common stock			25				53				25				78
Total weighted average shares outstanding			139,052				139,079				139,052				139,104

DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS
(Unaudited)
(In thousands)

		Three Months Ended
		June 30,
		2011				2010
REVENUES
High Specification Floaters		$	452,289			$	340,387
Intermediate Semisubmersibles			356,840				389,094
Jack-ups			60,512				82,223
Other			5				35
Total Contract Drilling Revenue		$	869,646			$	811,739
Revenues Related to Reimbursable Expenses		$	19,850			$	10,864
CONTRACT DRILLING EXPENSE
High Specification Floaters		$	203,459			$	134,500
Intermediate Semisubmersibles			138,879				157,446
Jack-ups			38,552				51,717
Other			7,116				8,106
Total Contract Drilling Expense		$	388,006			$	351,769
Reimbursable Expenses		$	19,287			$	10,379
OPERATING INCOME
High Specification Floaters		$	248,830			$	205,887
Intermediate Semisubmersibles			217,961				231,648
Jack-ups			21,960				30,506
Other			(7,111	)			(8,071	)
Reimbursable expenses, net			563				485
Depreciation			(101,175	)			(100,746	)
General and administrative expense			(16,372	)			(16,849	)
Bad debt recovery			1,700				2,798
Gain on disposition of assets			1,240				149
Total Operating Income		$	367,596			$	345,807

DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)

		June 30,				December 31,
		2011				2010
		(unaudited)
ASSETS
Current assets:
Cash and cash equivalents		$	279,876			$	464,393
Marketable securities			700,486				612,346
Accounts receivable, net of allowance for bad debts			592,157				609,606
Prepaid expenses and other			196,689				177,153
Total current assets			1,769,208				1,863,498
Drilling and other property and equipment, net of accumulated depreciation			4,159,542				4,283,792
Long-term receivable			—				35,361
Construction deposits			478,320				154,427
Other assets			323,553				389,906
Total assets		$	6,730,623			$	6,726,984
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities		$	370,059			$	626,288
Long-term debt			1,495,707				1,495,593
Deferred tax liability			527,903				542,258
Other liabilities			197,357				201,133
Stockholders’ equity			4,139,597				3,861,712
Total liabilities and stockholders’ equity		$	6,730,623			$	6,726,984

DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES
AVERAGE DAYRATES AND UTILIZATION

		Second Quarter								First Quarter								Second Quarter
		2011								2011								2010
		Dayrate				Utilization				Dayrate				Utilization				Dayrate				Utilization
		(Dayrate in thousands)
High Specification Floaters		$	364				94	%		$	339				81	%		$	373				69	%
Intermediate Semis		$	266				76	%		$	273				80	%		$	269				82	%
Jack-ups		$	82				60	%		$	82				47	%		$	85				76	%