Executives: Samir Ali - Diamond Offshore Drilling, Inc. Marc Edwards - Diamond Offshore Drilling, Inc. Kelly Youngblood - Diamond Offshore Drilling, Inc. Ronald Woll - Diamond Offshore Drilling, Inc.

Analysts: Gregory Lewis - Credit Suisse Securities (USA) LLC Ian Macpherson - Simmons & Company International Rob J. MacKenzie - IBERIA Capital Partners LLC Jacob Ng - Morgan Stanley & Co. LLC Samantha Kay Hoh - Evercore Group LLC Eduardo B. Royes - Jefferies LLC

Operator: Good day, ladies and gentlemen, and welcome to the Diamond Offshore Incorporated First Quarter 2017 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. As a reminder, this conference call is being recorded. I would now like to turn the conference over to Samir Ali. You may begin.

Samir Ali - Diamond Offshore Drilling, Inc.: Thank you, Grace. Good morning, everyone, and thank you for joining us. With me on the call today are Marc Edwards, President and Chief Executive Officer; Ron Woll, Senior Vice President and Chief Commercial Officer; and Kelly Youngblood, Senior Vice President and Chief Financial Officer. Before we begin our remarks, I remind you that the information reported on this call speaks only as of today. And therefore, you're advised that time-sensitive information may no longer be accurate at the time of any replay of this call. In addition, certain statements made during this call may be forward-looking in nature. Those statements are based on our current expectations and includes known and unknown risks and uncertainties, many of which we are unable to predict or control, that may cause our actual results or performance to differ materially from any future results or performance expressed or implied by these statements. These risks and uncertainties include the risk factors disclosed in our filing with the SEC included in our 10-K and 10-Q filings. We further expressly disclaim any obligation to update or revise any forward-looking statements. Please refer to the disclosure regarding forward-looking statements incorporated in our press release issued earlier today. And please note that the contents of our call are covered by that disclosure. We will be referencing non-GAAP figures on our call today. Please find the reconciliation on our website. And now I'll turn the call over to Marc.

Marc Edwards - Diamond Offshore Drilling, Inc.: Thank you, Samir. Good morning, everyone, and thank you for joining us today. For the first quarter of 2017, we announced earnings per share of $0.17, which compares to earnings per share of $0.64 in the first quarter of 2016. The year-on-year decrease is, once again, a consequence of the ongoing decline in the demand for offshore drilling rigs and the impact this has on contract day rates. With that said, we commenced two new contracts for our sixth-generation assets, the Ocean GreatWhite and the Ocean BlackRhino. And additionally, we secured a new term contract for our third-generation asset, the Ocean Patriot, as well as securing two new short-term contracts for the Ocean Monarch. Overall, I'm pleased with these results, as it demonstrates our ability to employ all of our sixth-gen assets and find new work for a variety of asset classes while, at the same time, maintaining a relentless focus on cost management and increased operating efficiency. So, allow me to give further color on the fleet itself. The Ocean BlackRhino commenced its three-year term contract for Hess in the Gulf of Mexico at a rate of $400,000 per day, and the Ocean GreatWhite commenced its three-year term contract for BP. Recall that the rig is currently in stand-by mode with reduced activity, allowing the contract margin to be maintained to that of the original contract rate of $585,000 per day. Additionally, the Ocean Scepter returned to work in Mexico, maintaining a presence for us in a market whose importance will only grow in the years to come. I will remind everyone that we are uniquely positioned among our peers, as all of our sixth-generation assets are deployed under long-term contracts at rates of over $400,000 per day. So staying with the sixth-gen fleet, Diamond Offshore set a new technical record during the first quarter when the Ocean BlackLion successfully drilled and completed one of the deepest and most challenging wells on record in the Gulf of Mexico. For the first time, an intelligent well completion system was successfully deployed simultaneously over three pay zones (4:15) at a depth of 31,000 feet. Our ability to effectively drill and complete such a demanding well exemplifies the Diamond difference, and is a testament to the quality of our operational and technical excellence. This morning, we also announced that we secured two new contracts for the Ocean Monarch in Australia. These contracts will keep one of our premier assets in the region utilized through the end of 2018 and likely and beyond. The Ocean Monarch is currently completing her special survey in Singapore and will then begin working for BHP Billiton on the North West Shelf of Australia in June. Following this contract, the rig will be mobilized to the Bass Strait to begin drilling for Cooper Energy and then Origin Energy. Diamond has a strong reputation in the Australian market, and these two contracts ensure that we will continue to have a presence in the country for many years to come. In the North Sea, our strong reputation also delivered a new two-year term contract for the third-generation Ocean Patriot with Apache, beginning in the second quarter of 2018. The rig is currently operating for Shell and will finish its program in October of this year. After Shell, the rig will complete a special survey and will then be returned to service early in 2018. Diamond Offshore continues to look for new ways to drive efficiencies into deepwater drilling, as our Floating Factory and Pressure Control by the Hour initiatives have demonstrated. And during the quarter, we began implementing our new risk-based asset management system, which enables predictive maintenance. This system has been under development for over 18 months, and we are now ready to implement it fleet-wide. And with this solution, Diamond Offshore will utilize data analytics to manage rig maintenance across our entire fleet for improved reliability and lower operating costs. This approach moves away from the drilling industry's traditional reliance on time-based rig maintenance, and embraces leading practices often found in high-reliability industries, such as aerospace and power generation. Our unique-to-the-industry Pressure Control by the Hour construct is now approaching the first anniversary of its implementation, and we are beginning to see tangible benefits. As we deliver improved system reliability, we will lower the total cost of ownership for our customers and will help offshore projects become more economic in the long term. Our implementation of Pressure Control by the Hour and predictive asset management is an important step in positioning Diamond for sustainable success, as offshore drilling market dynamics eventually come back into balance. Now to update you on the contractual dispute with Petrobras on the Ocean Valor. We were recently supported by the Rio Appellate Court with a significant unanimous verdict that allows the Valor to remain on contract for the foreseeable future. The injunction requires both parties to comply with the terms of the contract. Hence, the rig will remain on stand-by rate and maintain a full crew. We, of course, value our relationship with Petrobras and continue to have a good and productive dialogue regarding other ongoing operations in the region. And now regarding the market. We believe that it is still too early to call a bottom in deepwater utilization, although we could be witnessing the first signs of a trough and falling rig demand. However, even when demand stabilizes, there will likely still be an oversupply in the sixth-generation asset class. At a major industry conference here in Houston during February, many of the operating companies who contract deepwater assets, however, have stated that deepwater can compete on a financial returns basis with shale or North American light tight oil. Indeed, full life cycle project NPVs can, in many circumstances, deliver better returns onshore than offshore. And the real issue here is the timing of the cash flows while oil prices languish at the current levels, which then direct investments onshore. However, we are now seeing many IOCs revisiting their deepwater portfolios and options with a view as to when to bring sanctioning back over the horizon. Nevertheless, it is important to express caution here due to the time lag from projects sanctioned to the actual commencement of drilling activity. But when current industry investment is at such unsustainable levels, we are finally starting to see discussions in relation to deepwater portfolios. It is clear that deepwater economics continue to improve through project standardization and simplification while competing shale costs are now trending back up. Recent commentary from clients suggest that deepwater still has an important contribution to balancing the future demand-supply stock. So with that, I will turn the call over to Kelly to discuss the financials for the quarter, and then I'll have some closing remarks. Kelly?

Kelly Youngblood - Diamond Offshore Drilling, Inc.: Thank you, Marc, and good morning, everyone. Today, we reported after-tax net income of $24 million or $0.17 per share for the first quarter of 2017 compared to our fourth quarter 2016 results of $116 million or $0.85 per share. The sequential decline was a result of a customer settlement and tax benefit recorded in the fourth quarter for $36 million and $43 million, respectively, partially offset by new contract start-ups during the first quarter for the Ocean BlackRhino, Ocean GreatWhite and Ocean Scepter. Contract drilling revenues of $364 million for the first quarter represented a sequential decline of 5%. However, excluding the customer settlement in the fourth quarter, revenues actually increased sequentially by 4%, driven by improved operating efficiency and the new contract additions during the quarter. Partially offsetting the higher revenue was the Ocean Monarch, which went off contract and started a special survey during the first quarter. Similarly, these items also account for the higher contract drilling cost, which increased 17% compared to the fourth quarter but slightly below our guidance due to the timing of certain costs related to the Ocean Monarch special survey. Depreciation, G&A cost and interest expense were all within the range of our previous guidance. The effective tax rate for the quarter was approximately 4% lower than our previous guidance, resulting from a net effect of a favorable geographic mix of earnings and various discrete tax items recorded during the quarter. And finally, in April, we completed the sale of the Ocean Spur, which is the last remaining rig classified as an asset held for sale. Since 2012, we have sold (11:42) 27 rigs, the majority of which have been scrapped. These actions to rationalize our fleet have allowed us to increase the focus on our premier deepwater assets. And additionally, Diamond now has one of the youngest active fleets with an adjusted average age of approximately 10 years, which is well below the industry average of 14 years. I will now discuss some of the more noteworthy items impacting our outlook. First, as previously mentioned, the Ocean BlackRhino, Ocean GreatWhite and Ocean Scepter began new contracts during the first quarter. Our second quarter results will benefit from a full quarter of operations positively impacting our revenues and profitability. Next, the Ocean Monarch will be completing a special survey and other contract preparation activities and will go on contract late in the second quarter. Partially offsetting these revenue improvements are the Ocean Guardian and Ocean Victory, which will go off day rate in the second quarter. The Guardian is currently planned to be warm-stacked, awaiting the results of various opportunities later this year and in 2018. Lastly, we have a special survey for the Ocean Patriot scheduled to take place in the fourth quarter. For more detail related to projections of currently scheduled downtime, please refer to our quarterly rig status report that we filed this morning. Now moving on to more specific guidance for the second quarter. We expect contract drilling cost to come in between $205 million to $210 million, slightly higher than the first quarter due to the full quarter effect of the new contract additions, partially offset by the warm-stacking of the Ocean Guardian and Ocean Victory rolling off contract. We estimate depreciation expense to be approximately $87 million for the second quarter of 2017. G&A costs are expected to be approximately $17 million to $19 million in the second quarter, in line with our recent run rate. Interest expense on our current debt and expected borrowings on our bank line of credit is projected to be approximately $27 million in the second quarter and is expected to be at similar levels for the remainder of the year. We anticipate our effective tax rate to be approximately 20% in the second quarter. Of course, the rate may fluctuate up or down based on a variety of factors including, but not limited to, changes of geographic mix of earnings, as well as was tax assessments, settlements or movements in exchange rates. For our capital expenditures guidance, we now estimate that we will incur maintenance capital cost of approximately $145 billion (sic) [million] (14:27) for the full year of 2017. And finally, I want to reiterate the strength of our balance sheet and liquidity position. We currently have an undrawn revolving credit balance of $1.5 billion. And with the recent court ruling on the Ocean Valor, our liquidity and cash flow position are further enhanced as we believe the recent court decision has materially de-risked our forecast. With no significant planned capital expenditures ahead of us, Diamond Offshore is positioned to generate significant free cash flow over the coming years that can be deployed in a variety of ways. And with that, I'll turn it back to Marc.

Marc Edwards - Diamond Offshore Drilling, Inc.: Thank you, Kelly. So, just building on that before we open the call up for questions, I'd like to reiterate there's been no change to our forward capital allocation strategy, which is to position for opportunity stressed asset purchases, possible M&A and/or build the Floating Factory. We cannot control the deepwater market, but we can best position Diamond for the eventual recovery and, as such, the efficient use of capital remains our focus. In the last few years, Diamond Offshore has demonstrated our ability to innovate and drive thought leadership in the industry to improve efficiency and lower the total cost (15:45) to drilling. Coupled with our superior balance sheet and strong liquidity, we believe Diamond remains well-positioned for the eventual market recovery. And with that, I will open the call up for questions.

Operator: Thank you. And our first question comes from Greg Lewis from Credit Suisse. Your line is now open.

Gregory Lewis - Credit Suisse Securities (USA) LLC: Yes, thank you. Thank you and good morning, everybody.

Marc Edwards - Diamond Offshore Drilling, Inc.: Good morning, Greg.

Kelly Youngblood - Diamond Offshore Drilling, Inc.: Good morning.

Gregory Lewis - Credit Suisse Securities (USA) LLC: So, Marc, I mean, clearly, there was some good news announced this morning down in Brazil, and some work. And you mentioned, I guess in February, the market's bottoming. Is the company starting to kind of be able to look through what's going on in the market and maybe, in a certain point, start to get a little aggressive? I mean, it seems like – what I would argue was your core rig continue to sort of win pieces of work. Is that changing the strategy at all and maybe making the company a bit more aggressive in how they're thinking about the next two, three years?

Marc Edwards - Diamond Offshore Drilling, Inc.: Greg, we've always been monitoring the market very, very closely as it relates to estimating when a bottom might materialize. In my prepared remarks, let's be clear, I think we're beginning to see the signs of a bottom. I haven't actually said that we're at the floor. And let's also realize that there's both demand and supply issues as it relates, certainly to the sixth-generation fleet. So, we still remain somewhat cautious as to what strategies we will enact moving forward. The future use of capital is very, very important to us, and we have to continue to be opportunistic as it relates to the moments when we pull those levers. So, I'm not suggesting at any stage now that we are ready to pull a lever in any particular direction. We're maintaining our optionality moving forward. And I think what we have to see is utilization start to track back up before we can truly call a bottom and suggest that the market is recovering. Now, you mentioned we've obviously got some good news this quarter, which we certainly do, and that relates to our ability to continue to put to work assets that are typically in the MOD (18:23) category. There's not much term work that's out there today. But let's just reiterate that we've just put a third-generation asset to work for two years at what could be described as quite a reasonable rate in this market. So, certainly there's positives that are out there right now, but I'm not exactly calling a bottom in the market at this particular moment in time.

Gregory Lewis - Credit Suisse Securities (USA) LLC: Okay, yeah, no, that makes sense. Yeah, it's still early days. And then just, I guess there was another announcement that are – there was an announcement out this morning that another three jack-ups were sold. I believe Seadrill is selling those – selling three jack-ups. Just given the fact that there is some jack-up activity in this marketplace, the company maintains the one, the Scepter. Is the jack-up market – it seems like it's noncore. Is this an asset that we potentially could be sold out of the fleet in the next year or two as sort of the jack-up market looks like it's – as transactions look like they're picking up in this market, or should I say is anybody calling you about potentially buying this rig at this point in time?

Marc Edwards - Diamond Offshore Drilling, Inc.: So, we continue to have inquiries on the Scepter. It is a good rig. It's our only jack-up that we have remaining. But critically for us, it maintains our presence in Mexico, and that is very, very important. We've been in Mexico for well over a decade, decade-and-a-half. And it's apparent to all that Mexico has a lot of potential in the deepwater space moving forward into the future. And therefore, our presence there, or our continued presence there, remains important to us. So, at this moment in time, we have no intent to offload the Scepter. It's a good rig on a good contract, and it maintains our presence in a market that will be very important for us moving forward.

Gregory Lewis - Credit Suisse Securities (USA) LLC: Thanks for the time, gentlemen.

Operator: Thank you. And our next question comes from Ian Macpherson from Simmons. Please JS (20:31) Your line is now open.

Ian Macpherson - Simmons & Company International: Thanks. Good morning. Congratulations on the new work for the Patriot and Monarch. And I was wondering if you could discuss what types of work those contracts entail, if it's traditional drilling, if there's more P&A lined up for those, or well intervention or other types of activity? And if you could just comment at all on your winning formula at winning respectable term work here in a very price-competitive environment, if you think it is a price-dictated market right now, or if you're able to add backlog like that on another competitive basis that's unique to Diamond.

Ronald Woll - Diamond Offshore Drilling, Inc.: Yeah. Good morning, Ian. This is Ron Woll. So, we were quite pleased to put the Patriot to work on some term contracts. That's pretty uncommon right now for that asset class, so we're kind of quite pleased to see that happen. I think it's largely a function, candidly, of her performance previously with both Apache and Shell. So I think rig operating results matter a lot to customers, and I think a good productive resume kind of helps us put those rigs back to work. So with regard to the Patriot, we are optimistic that she'll have a good solid run here with Apache starting mid next year. The work in the Bass Strait there for Cooper and Origin on the Monarch, I think that's also a case of rigs that work well with operators tend then to attract sort of more work. So, her strong resume in Australia, I think, matters a lot to operators. And so, it's a combination of, I think, smarts, kind of bid economics, as well as strong operating results is really part of that winning formula. So I would expect that a good result is going to bring sort of more future work for both Patriot or the Monarch and other rigs. We're quite pleased.

Marc Edwards - Diamond Offshore Drilling, Inc.: So just building on that just for a minute, Ian. You said what's particularly unique to Diamond around here. Let's not underestimate the fact that, obviously, it's a broader, more varied fleet than many of our peers, for example. And I've often spoke in the past about much of the distress really being positioned around the sixth-generation assets. As you've seen here, we've got some good term work with our MOD (23:03) assets which, over the course of the past five years, we've invested substantially on upgrading. And that asset class itself, when you look at the scrapping that's going on, is somewhat fixing itself perhaps better than the DP asset class or the DP rigs themselves. So I don't think it's unsurprising that as we move forward, we could expect to see, certainly in terms the initial recovery, I think MOD (23:34) rigs are coming back to work faster than the DP asset class, and I think this is just an example of that, for example. And that suggests why Diamond is somewhat better positioned than our peers.

Ian Macpherson - Simmons & Company International: Okay. Thanks, Marc and Ron, for those answers. Separately, Kelly, I got your guidance, I might have missed it or you might have provided revenue guidance. We do have a little bit more capacity there with not all of your contracts are visible to us now, but my model shows revenues in the second quarter flat to up a little bit sequentially. Is that a fair starting point?

Kelly Youngblood - Diamond Offshore Drilling, Inc.: That is very fair. You're exactly right. I mean, if you go through the different items, we have the three new contracts, the Rhino, the GreatWhite and the Scepter. You know that we get a full quarter of benefit in the second quarter. You've got the Monarch that will be kicking in late in Q2. And then you've got the – kind offsetting that somewhat, you've got the Victory that will be coming off contract in the middle of the second quarter and the Guardian that was warm-stacked early in the quarter. So, you net all of those things out, you're spot on, Ian. It will be flat to slightly higher.

Ian Macpherson - Simmons & Company International: Good. Thanks very much.

Kelly Youngblood - Diamond Offshore Drilling, Inc.: Okay.

Operator: Thank you. And our next question comes from Rob MacKenzie from IBERIA Capital. Your line is now open.

Rob J. MacKenzie - IBERIA Capital Partners LLC: Hi, guys. Good morning.

Marc Edwards - Diamond Offshore Drilling, Inc.: Good morning, Rob.

Rob J. MacKenzie - IBERIA Capital Partners LLC: I wanted to dig in on your risk-based asset management system here a little bit. And maybe if you could help us understand the potential financial returns and whether or not that's going to be primarily driven by, obviously, increased uptime and/or reduced operating costs and how that might break out among the two.

Marc Edwards - Diamond Offshore Drilling, Inc.: So, we've been working on implementing this new program for the past 18 months, and now we're ready to roll it out across the fleet. I don't think you're going to see a binary change in cost management. I think over the course of the next couple of years, however, we will see an improvement in reducing our maintenance expense across the fleet. And this really is based on using predictive maintenance and analytics to establish when is the best time from a cost perspective and an NPT perspective to replace componentry across the rig itself. So, it's just not related to subsea. It's also related to the drilling equipment and so on and so forth. Now, bear in mind that any cost impact that comes from this can have a knock-on effect with rig efficiencies and reliability in terms of reducing NPT, as it relates to predictive analytic of – analysis of potential failures on certain rig components. So at this stage, I think it's somewhat a little bit too early to try out a specific number. I do feel that as the industry goes down this path, I mean, this is not necessarily unique to ourselves, that we will further reduce costs in deepwater drilling. But in terms of the true impact of rig efficiencies and reducing NPT, we've got to hit the poor performance of the subsea stacks in the BOPs, and that's why I think we'll see more improvement coming through our Pressure Control by the Hour initiative than certainly this rig-based system for maintenance. I think the real low-hanging fruit is just getting the subsea stack reliability up to spec into where it should be. And then beyond that, we can focus on predictive analytics as it relates to maintenance and take some cost out of that. So, there's not one single silver bullet that's going to address rig reliability. This is just another add-on. But from our perspective, the big issue is Pressure Control by the Hour and then the rig-based asset management system follows on behind that.

Rob J. MacKenzie - IBERIA Capital Partners LLC: Great. Thank you. And then quick follow-up on both Patriot and the Monarch, both of which have a gap. I think you mentioned in the prepared remarks there's a survey between each of those. Is there any expectation for work for either of those rigs between their contract expires this year and then the start of work starting next year?

Ronald Woll - Diamond Offshore Drilling, Inc.: Rob, this is Ron. On the Patriot, the answer would be yes. So, in between the special survey concluding and the start of the work with Apache, there was a gap that we're mindful of, and that represents the next sort of value of commercialization work first to pay attention to. So, there are some things we're focused on there. Nothing announced today, but to be sure, that gap is very much on our minds. With regard to the Monarch, so there is – we've got, of course, the survey, transit time, mode time. So, there are some pieces of the schedule where we can try to fill in some of that work. Candidly, depending on sort of what Cooper and Origin do, their program sort of has its (28:58) as well which may fill in part of those times. So, the next body of work for us on both the Patriot and the Monarch is to focus on kind of filling in those gaps. So, we're certainly glad to have the contracts that we announced today, and the next piece of work is to come and fill out their schedules.

Rob J. MacKenzie - IBERIA Capital Partners LLC: Great. Thanks. I'll turn it back.

Operator: Thank you. And our next question comes from Jacob Ng from Morgan Stanley. Your line is now open.

Jacob Ng - Morgan Stanley & Co. LLC: Good morning and thank you. You've previously shared a view of the jack-up market having the potential to be more distressed than the floater market, and I wonder if that's a view that's still current given the recent pickup in jack-up fixtures. (29:38)

Marc Edwards - Diamond Offshore Drilling, Inc.: So, yes, we've been saying that because of the number of newbuilds that still remain to be delivered in the jack-up space compared with the number of those who actually have contracts. There's over 100 jack-ups that are still in the yards themselves. Certainly less than 20 of those have contracts moving forward. So, we're a little bit surprised to see the activity in the – as it relates to the movement of assets in the jack-up space. If you look at the – if you compare that to the MOD (30:16) assets and the DP assets, that overhang in supply is not at the same numbers by any sense of the imagination. And I think as you look at the scrapping that's certainly taking place in the MOD (30:29) asset class, that asset class is certainly fixing itself forward. As we've demonstrated today, we've secured a term work as it relates to MOD (30:40) rigs moving forward. So, we don't have a change in that philosophy. I think perhaps as it relates to valuations, you've got to best ask the people that are paying for those valuations as to see how they see the market moving forward.

Jacob Ng - Morgan Stanley & Co. LLC: Got it. Thank you. Now, an equipment manufacturer also brought up last week that more offshore drillers are upgrading equipment to better compete in this crowded market. And I wonder if you can speak to how much real-time (31:12) pressure the industry's actually feeling from customers to do so on this front. And if this is indeed the trend, what kind of impact do you think this has on broader fleet attrition?

Marc Edwards - Diamond Offshore Drilling, Inc.: So, your question is relating to the upgrading equipment on existing fleet. Is that what it is?

Jacob Ng - Morgan Stanley & Co. LLC: Correct.

Marc Edwards - Diamond Offshore Drilling, Inc.: So, we're not actually seeing much of that moving forward. I mean, do understand that these assets, the floating assets, are – they're $650 million, $800 million assets with huge investments on them as it relates to the derrick, as it relates to the top drive, as it relates to the BOP systems. And to upgrade those systems, it's a lot of money, and we don't actually see our peers investing that money at this moment in time to upgrade the drilling package or the BOPs on their rigs. The rigs are what they are today, and I don't think you're seeing many people chasing improvements in a market that remains somewhat challenged, certainly for the foreseeable future. So, I can't necessarily say that we've seen that. Now, from our perspective, we're still looking at the Floating Factory concept. Where we are in that is, we've got the final designs in place. We've spoken to a number of yards. We've got a full-scale prototype that has been constructed and has been tested. And that's the way we see really the market changing moving forward. Because the pressure from our clients is to materially take down deepwater cost through efficiency gains, and something like the Floating Factory is what is going to be required to deliver on that opportunity. So, obviously, we're going through maintenance schedules. We're placing equipment as maintenance dictates, and sometimes that equipment could be upgraded. And in actual fact, on the Patriot contract, we are actually looking at upgrading the top drive. But that's just one small data point, and it's not necessarily endemic of what's happening in the industry itself.

Jacob Ng - Morgan Stanley & Co. LLC: Thank you. Appreciate the color, and great job in the quarter.

Marc Edwards - Diamond Offshore Drilling, Inc.: Thank you.

Operator: Thank you. And our next question comes from Samantha Hoh from Evercore ISI. Your line is now open.

Samantha Kay Hoh - Evercore Group LLC: Hey, guys.

Marc Edwards - Diamond Offshore Drilling, Inc.: Sam, hi.

Samantha Kay Hoh - Evercore Group LLC: Hi. Thanks for taking my question, and congrats on the quarter. You've done a great job outlining all your fleet availability and actually contracting some of these. But the one that we haven't covered yet today is the Victory, and I just wonder if you could maybe talk about the outlook in Trinidad and what you see there in that market.

Ronald Woll - Diamond Offshore Drilling, Inc.: Sam, good morning. This is Ron. Glad to have you here. For the Victory, I think she'll conclude her work with BP. I would not hold sort of high hopes for some serious work kind of following that program. Certainly, we don't think about our 2017 or 2018 results sort of having a lot from the Victory right now. So, I wouldn't put a lot of sort of financial weight on her revenue sort of generating power for the balance of this year. I think from a third-, fourth- and sort of fifth-generation standpoint, we like obviously putting more work on the Patriot. The Monarch has been very successful, but the Victory, I wouldn't model a lot of math around her for the next quarter or two.

Samantha Kay Hoh - Evercore Group LLC: Okay. And then, I guess, the last one for me really is just on the pace of the floater retirement in the industry. You guys have done more than your share of just helping to correct this market. And I'm just kind of wondering what you anticipate in terms of, as we kind of move through the trough of this cycle, what your peer's doing in terms of helping to further improve the availability of floaters and, especially in the Gulf, I guess, where there's just so many rigs cold-stacked. So, it's just – I'm curious particularly how you're thinking about the cold-stacked market or the retirement market.

Marc Edwards - Diamond Offshore Drilling, Inc.: So, Sam, yeah, that's something that we're monitoring very, very closely. Yes, we have certainly done our fair share. So, there's approximately 70 rigs that have been scrapped so far this cycle, and the vast majority of them have been in the fourth-generation asset class and below. And of course, around 80% of them have been maud. (35:58) And as I keep referring to in the call, we do feel that the MOD (36:06) asset class, which is essentially fourth generation and below, had somewhat fixed itself. We've certainly seen a slowing down of the scrapping that's taking place in that asset class. But I think that for those rigs that have had upgrades over the last few years, I think there's a bright future for them certainly. The question is what's going to happen in the sixth-generation asset class. And frankly, I think if we truly keep an open mind about this, the problem we've got in the asset class is the book value that's still sitting on the owner's balance sheet as it relates to the value of those assets. And indeed, what is probably holding up the scrapping of the sixth-generation DP asset class is the effect of any impairments that would come with those, with that scrapping and the resulting effect on the debt covenants that many of those companies are holding. So, there's generally a reluctance, I think, to actually graft (37:14) the metal and start scrapping some of the early-generation, sixth-gen rigs, the ones that came out in 2008, 2009, 2010, for example, that are sitting at the back of the deli line in terms of desirability, and many of our peers simply just can't afford to take the impairment on those rigs due to, as I mentioned, breaking their debt covenants. And as a result, they're just sitting out there. I think, ultimately, however, if we truly take a look forward to this recovery, which will be somewhat drawn out, I think that many of those sixth-generation rigs that are cold-stacked today, that are of the early-generation, sixth-gen category will not see the light of day again simply because as each year passes, your activation cost come up too high. And therefore, they will effectively be de facto scrap. They just won't re-enter the market. And I think there are some examples of rigs that went to auction last year that I'd be very surprised to come back into the market moving forward. So, there's not enough scrapping, certainly, taking place in the sixth-gen asset class for reasons that I've just explained, but I think that the market will eventually prove itself out. And certainly those early ones will just simply not see the light of day again and will ultimately be scrapped.

Samantha Kay Hoh - Evercore Group LLC: Thank you so much for that color, Marc, and thank you, Ron. Congrats again on the quarter.

Marc Edwards - Diamond Offshore Drilling, Inc.: Thank you.

Operator: Thank you. And our next question comes from Eduardo Royes from Jefferies. Your line is now open.

Marc Edwards - Diamond Offshore Drilling, Inc.: Eduardo, hi.

Operator: Eduardo, if your phone is on mute, please un-mute it.

Eduardo B. Royes - Jefferies LLC: Hey, guys, good morning.

Kelly Youngblood - Diamond Offshore Drilling, Inc.: Good morning, Eduardo.

Eduardo B. Royes - Jefferies LLC: Just one quick follow-up for me related to – actually similar to the – along the lines of the last question. Have you seen – now that we've had the current cycle, sixth-gen newbuilds out there for a few years, have you seen a noticeable difference in terms of drilling efficiencies or performance when you look at some of the rigs that were ordered after 2010 and that started getting delivered in 2014 and 2015 versus some of the earlier cycle rigs? So, Marc, I know you just mentioned that the stacking economics is probably what's going to prevent some of those older rigs from ever coming back out because they've been sitting idle. But I'm just curious if you think we had enough time under our belt now to see some real improved performance from, say, a 2015 vintage rig versus something that was 2009 or 2010.

Marc Edwards - Diamond Offshore Drilling, Inc.: So, yes and no. I think it really relates to the technical capability of the rigs themselves, so whether it's a hook-load, whether it's offline capability or the fact the rigs have dual derrick s on them. I think that there has been a marginal increase and efficiency for certainly the dual derrick rigs. But when clients have a choice and effectively when pricing is essentially the same, they always go for the rigs with that extra capability from a technical perspective. So, it's a high hook-load, it's dual derrick capability, it's whether they've got (40:43) or not. Because let's not forget that many of the original assets that came out simply don't have or aren't competitive in terms of those three issues: they're single BOP, they're single derrick, and hook-load is perhaps not as much as it is required certainly in the Gulf of Mexico for the 30,000-foot wells that are being delivered today. So, efficiency increases come through two ways. It's actually knowing the reservoir that you're drilling and certainly, for example, our flagships are drilling wells faster today than they did a year ago through just the main knowledge of drilling up those reservoirs. But in terms of the technical efficiency of the rigs themselves, the dual derrick system is the one that brings the most advantage, and that's anything from 6% to maybe 10%. Now, we've done some DWOPs (41:41) with our Floating Factory designs and over and above the dual derrick rigs, we can put a further 20% to 30% efficiency gain on drilling the wells out there. So that itself is quite compelling. The real issue we have is that many of our clients, if not all, are not really looking out far enough to the end of the decade but what could potentially be a delivery of that kind of technology. So the latter rates are slightly better, but where they're going to get hung up is on the fact that they don't have a dual BOP, they're single derrick and they have a limited hook-load.

Eduardo B. Royes - Jefferies LLC: Great. Thank you very much. If I could actually just sneak one more and I'm curious, you're the second driller to report this season and I guess it's the second time we hear a lot about – or a lot more, I guess, about this sort of predictive analytics maintenance and, obviously, we've been hearing some of that on the cap equipment side. Just curious if you could give some perspective on how much is being done in-house, if you will, sort of from scratch with Diamond versus how much is – are you using some of these bigger household names, if you will, to sort of lay the groundwork and then you work with them. I'm just trying to figure out how much of this is sort of done in-house versus how much is just sort of purchased from other guys and using what's being developed on the OEM side. Thanks.

Marc Edwards - Diamond Offshore Drilling, Inc.: So about 80% of it is being done in-house, 20% is from third-party vendors. And this is – let's not confuse Pressure Control by the Hour with rig-based asset management systems and maintenance systems. On the Pressure Control by the Hour, we actually outsource that entirely to the original equipment manufacturer. And that's been in place for over a year now, and we are seeing tangible benefits moving forward in replacing componentry on the subsea stacks with equipment that is significantly more reliable than what was in place previously. So, the Pressure Control by the Hour really addresses NPT and rig efficiency. The rig-based asset management systems are more going to impact lowering maintenance cost. And they will have a small impact on reducing NPT as well, but it's important that we don't confuse both issues here. There is a lot going around the industry today about the Industrial Internet of Things and gathering data and being a little bit more efficient in interpreting that data. That's not necessarily new to the industry. I mean, the big diversified service providers have been using data for many, many years as to improve efficiency certainly as it relates to the unconventional work here in North America. But it is time that we bring it to the offshore drillers. And in terms of driving cost out, it's important that we cover all aspects of drilling to include not in just reducing cost, but improving efficiencies, reducing NPT and so on and so forth. So, amongst all the things in terms of the thought leadership that Diamond's bringing to the industry, we truly believe that this, along with Pressure Control by the Hour and other things that we've introduced to the industry, that we can further bring deepwater costs materially lower than where they were before, because after all, necessity is the mother of innovation.

Eduardo B. Royes - Jefferies LLC: Great. Thank you very much. I'll turn it over.

Operator: Thank you. I'm showing no further questions at this moment. I would like to turn the call back to Marc Edwards for any further remarks.

Marc Edwards - Diamond Offshore Drilling, Inc.: So, thank you very much for participating in today's call, and we look forward to speaking with you all again next quarter.

Operator: Ladies and gentlemen, thank you for participating in today's conference. This concludes today's program. You may all disconnect. Everyone, have a great day.