Diamond Offshore – CEO Interview

xfdfx YOUR-WORLD-WITH-NEIL-02

Show: YOUR WORLD WITH NEIL CAVUTO

Date: June 24, 2010

Time: 16:00:00

Tran: 062402cb.140

Type: INTERVIEW

Head: Diamond Offshore - CEO Interview

Sect: Business

Byline: Stuart Varney

Guest: Larry Dickerson

Spec: Business; Oil & Gas Industry; DO (NYSE); SIC: 2911

Time: 16:09:00

STUART VARNEY, GUEST HOST: The fight over the president`s drilling plan creating a lot of uncertainty for my next guest. And now he`s considering moving all of his rigs out of the Gulf, moving them into international waters.Diamond Offshore chief executive officer Larry Dickerson joins us now in a first on FOX

Sir, welcome to the program. Good to have you.

LARRY DICKERSON, CEO, DIAMOND OFFSHORE: Glad to be here.

VARNEY: I think it`s true to say that the president doesn`t want drilling anytime soon. So, will you tell us here and now that you`re indeed going to move the rigs that you have got in the Gulf and move them elsewhere? Will you do it?

DICKERSON: Well, today, we got an indication that the moratorium is lifted and several of those rigs are under contract to customers here in the Gulf, so we would only move them if we work something out with those customers.

(CROSSTALK)

VARNEY: However, Secretary Salazar is going to issue new regulations, re-up this moratorium, reimpose the ban. So, you`re dealing in a climate of uncertainty.

My real question is, what does this climate of uncertainty do to the drilling business and to jobs in the Gulf area?

DICKERSON: Well, uncertainty, there`s nothing uncertainty for our customers who are spending maybe as much as $100 million on a well and they don`t know whether they are going to find petroleum or have a dry hole.

So, when you up the uncertainty, it makes it worse. And so that`s overhanging it. We certainly have been look at moving rigs overseas. Right now, with the moratorium lifted, and I think, as of today, the latest is that Salazar is backing down and issuing orders that the moratorium is not in place, but the government is certainly appealing it. So, there is uncertainty.

VARNEY: We`re always thinking of people in the oil business as earning a lot of money. Do those rig workers, do they make serious money? Can you tell us how much?

DICKERSON: Well, our average wage in the Gulf of Mexico is $77,000 a year for somebody that may only have a high school diploma. And they get six months off.

So, I think these are wages that are comparable to what automobile workers earn. So, they`re great jobs, and they`re jobs that really shouldn`t be driven overseas.

VARNEY: Should BP be forced to pay those workers who have been laid off because of President Obama`s moratorium on drilling?

DICKERSON: Well, to the degree that that`s damaging our employees, there`s a fund set up and we`re encouraging any of those that might get laid off to apply for that. So certainly, if the money`s there, they`re -- I would think, though, that we could avoid and we could make sure that BP has adequate funds to cover all their other liabilities by not having oil field workers get laid off.

VARNEY: Got it.

DICKERSON: And that would be the case with the moratorium being suspended.

(CROSSTALK)

VARNEY: All right, Larry Dickerson, Diamond Offshore CEO, thanks for joining us, sir. Appreciate it.

END

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