UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934

Date of Report (date of earliest event reported): May 2, 2007

TRANSOCEAN INC.

(Exact name of registrant as specified in its charter)

Cayman Islands		333-75899		66-0582307
(State or other jurisdiction of incorporation or organization)		(Commission File Number)		(I.R.S. Employer Identification No.)

4 Greenway Plaza
Houston, Texas 77046
(Address of principal executive offices and zip code)

Registrant’s telephone number, including area code: (713) 232-7500
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o		Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o		Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

ITEM 2.02 Results of Operations and Financial Condition.

     Our press release dated May 2, 2007, concerning first quarter 2007 financial results, furnished as Exhibit 99.1 to this report, is incorporated by reference herein. The press release contains certain measures (discussed below) which may be deemed “non-GAAP financial measures” as defined in Item 10 of Regulation S-K of the Securities Exchange Act of 1934, as amended.

     In the press release, we discuss field operating income for the three months ended December 31, 2006 and March 31, 2007. Management believes field operating income is a useful measure of operating results since the measure only deducts expenses directly related to operations from revenues. The most directly comparable GAAP financial measure, operating income before general and administrative expenses, and information reconciling the GAAP and non-GAAP measures are included in the press release.

ITEM 7.01 Regulation FD Disclosure.

     On May 2, 2007, Transocean Inc. (the “Company”) is posting the slide presentation furnished as Exhibit 99.2 to this report on the Company’s website at www.deepwater.com. Exhibit 99.2 is incorporated in this Item 7.01 by reference.

     The statements made herein that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements include, but are not limited to, statements involving prospects for the Company, expected revenues, capital expenditures, costs and results of operations, market outlook, revenue backlog for the Company and other drillers, contract opportunities and commitments, operational performance, rig demand, rig capacity, dayrates, rig reactivations, rig upgrades including upgrade projects for the Sedco 700-series semisubmersible rigs, newbuild and acquisition opportunities, uses of excess cash including stock buybacks, debt reduction, fleet marketing efforts, rig mobilizations and planned shipyard programs. Such statements are subject to numerous risks, uncertainties and assumptions, including but not limited to, uncertainties relating to the level of activity in offshore oil and gas exploration and development, exploration success by producers, oil and gas prices, rig demand and capacity, drilling industry market conditions, possible delays or cancellation of drilling contracts, work stoppages, operational or other downtime, the Company’s ability to enter into and the terms of future contracts, the availability of qualified personnel, labor relations, future financial results, operating hazards, political and other uncertainties inherent in non-U.S. operations (including exchange and currency fluctuations), war, terrorism, natural disaster and cancellation or unavailability of insurance coverage, the impact of governmental laws and regulations, the adequacy of sources of liquidity, the effect of litigation and contingencies and other factors discussed in the Company’s Form 10-K for the year ended December 31, 2006 and in the Company’s other filings with the Securities and Exchange Commission (“SEC”), which are available free of charge on the SEC’s website at www.sec.gov. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated. You should not place undue reliance on forward-looking statements. Each forward-looking statement speaks only as of the date of the particular statement, and we undertake no obligation to publicly update or revise any forward-looking statements.

     The information furnished pursuant to Items 2.02 and 7.01 of this report, including Exhibits 99.1 and 99.2, shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, nor will it be incorporated by reference into any registration statement filed by Transocean Inc. under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein by reference. The furnishing of the information in this report is not intended to, and does not, constitute a determination or admission by Transocean Inc. that the information in this report is material or complete, or that investors should consider this information before making an investment decision with respect to any security of Transocean Inc.

ITEM 9.01 Financial Statements and Exhibits.

(d)

Exhibits.

The following exhibits are furnished pursuant to Items 2.02 and 7.01:

Exhibit Number				Description
	99.1			Transocean Inc. Press Release Reporting First Quarter 2007 Financial Results
	99.2			Slide Presentation

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

INDEX TO EXHIBITS

     The following exhibits are furnished pursuant to Items 2.02 and 7.01:

Exhibit Number				Description
	99.1			Transocean Inc. Press Release Reporting First Quarter 2007 Financial Results
	99.2			Slide Presentation

Exhibit 99.1

		Transocean Inc.   Post Office Box 2765   Houston TX 77252 2765

 

Analyst Contact:		John Briscoe 713-232-7551			News Release FOR RELEASE: May 2, 2007
Media Contact:		Guy A. Cantwell 713-232-7647

TRANSOCEAN INC. REPORTS
FIRST QUARTER 2007 FINANCIAL RESULTS

     HOUSTON—Transocean Inc. (NYSE: RIG) today reported net income for the three months ended March 31, 2007 of $553 million, or $1.84 per diluted share, on record quarterly revenues of $1,328 million. The results compare to net income of $206 million, or $0.61 per diluted share, on revenues of $817 million, for the three months ended March 31, 2006. Net income for the three months ended March 31, 2007 included an after-tax gain of $20 million, or $0.07 per diluted share, resulting primarily from the sale of the tender rig Charley Graves. The results for the corresponding three months in 2006 included after-tax gains totaling $43 million, or $0.12 per diluted share, resulting from the sale of two rigs.

     Robert L. Long, Chief Executive Officer of Transocean Inc., stated, “Demand for deepwater drilling rigs continues to be strong and we continue to benefit from the significant backlog we have built and the ongoing rollover of contracts to higher and higher dayrates. The exceptional results realized in the first quarter can be attributed in large part to great execution by our people in achieving significantly improved revenue efficiency fleet wide while continuing to improve our safety performance as we strive for incident-free operations.”

     Operations Quarterly Review

     Revenues for the three months ended March 31, 2007 increased 12% to $1,328 million compared to revenues of $1,186 million during the three months ended December 31, 2006. This increase in revenues was primarily due to an improvement in average daily revenue, which rose 15% to $198,000 from $171,700 during the three months ended December 31, 2006, and increases in rig revenue efficiency. This improvement was consistent across the company’s fleet as several rigs commenced new contracts with dayrates that reflect the strong business environment prevalent since mid-2004. In addition, first quarter 2007 revenues were enhanced by increased activity as the semisubmersible rig C.K. Rhein, Jr. commenced operations following the completion of its reactivation project.

     For the three months ended March 31, 2007, operating income before general and administrative expenses totaled $683 million, a 3% decline from $701 million reported for the fourth quarter of 2006. This decline was due to gains of only $23 million on rig sales recognized in the first quarter of 2007 compared to gains on rig sales of $183 million recognized in the fourth quarter of 2006. Field operating income⁽¹⁾ (defined as revenues less operating and maintenance expenses) improved 23% to $760 million compared to $616 million over the prior three-month period. The improvement in first quarter 2007 field operating income was due chiefly to the strong revenue growth and also benefited from stable operating and maintenance expenses, which totaled $568 million during the first quarter of 2007 compared to $570 million during the previous quarter in 2006.

     Effective Tax Rate

     The company’s Annual Effective Tax Rate⁽²⁾ for the three months ended March 31, 2007 was 13.7%, excluding the previously mentioned impact on income before income tax related to the gain from the rig sale as well as excluding from income tax expense on various discrete items. The Effective Tax Rate⁽³⁾ of 13.3% for the first quarter of 2007 reflects the impact of the previously mentioned rig sale and a $2 million favorable impact resulting from changes in estimates and the resolution of prior years’ tax disputes in various jurisdictions. The company currently expects the effective tax rate for the remainder of 2007 to be approximately 14%, excluding the previously mentioned effects on income before tax related to the gain from the rig sale and excluding various discrete tax items.

     Share Buyback

     During the three months ended March 31, 2007, the company repurchased and retired $400 million of its ordinary shares, which amounted to approximately 5.2 million ordinary shares at an average purchase price of $77.39 per share. As of April 30, 2007, the company had repurchased and retired a total of $3.4 billion of its ordinary shares under the program, which amounted to approximately 47 million ordinary shares at an average purchase price of $72.48 per share. The company has authority remaining to repurchase $600 million of its ordinary shares under the program.

     Conference Call Information

     Transocean will conduct a teleconference call at 10:00 a.m. Eastern Time on May 2, 2007. To participate, dial 913-312-1297 and refer to confirmation code 6204914 approximately five to 10 minutes prior to the scheduled start time of the call.

     In addition, the conference call will be simultaneously broadcast over the Internet in a listen-only mode and can be accessed by logging onto the company’s website at www.deepwater.com and selecting “Investor Relations/News & Events/Webcasts & Presentations.” A file containing four charts to be discussed during the conference call, titled “1Q07 Charts,” has been posted to the company’s website and can also be found by selecting “Investor Relations/News & Events/Webcasts & Presentations.” The conference call may also be accessed via the Internet at www.CompanyBoardroom.com by typing in the company’s New York Stock Exchange trading symbol, “RIG.”

     A telephonic replay of the conference call should be available after 1:00 p.m. Eastern Time on May 2, 2007 and can be accessed by dialing 719-457-0820 and referring to the passcode 6204914. Also, a replay will be available through the Internet and can be accessed by visiting either of the above-referenced Worldwide Web addresses.

     Forward-Looking Disclaimer

     Statements regarding our backlog, market conditions, rig demand, our share repurchase plan, prospects for our business, as well as any other statements that are not historical facts in this release, are forward-looking statements that involve certain risks, uncertainties and assumptions. These include but are not limited to operating hazards and delays, risks associated with international operations, future financial results, actions by customers and other third parties, factors affecting the supply and demand of drilling rigs, including newbuilds, reactivations and the reallocation of current rigs, factors affecting the duration of contracts including well-in-progress provisions, the actual amount of downtime, factors resulting in reduced applicable dayrates, hurricanes and other weather conditions, the future price of oil and gas and other factors detailed in the company’s most recent Form 10-K and other filings with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated.

     Transocean Inc. is the world’s largest offshore drilling contractor with a fleet of 82 mobile offshore drilling units. The company’s mobile offshore drilling fleet, consisting of a large number of high-specification deepwater and harsh environment drilling units, is considered one of the most modern and versatile in the world due to its emphasis on technically demanding segments of the offshore drilling business. The company’s fleet consists of 33 High-

Specification Floaters (semisubmersibles and drillships), 20 Other Floaters, 25 Jackups and other assets utilized in the support of offshore drilling activities worldwide. With a current equity market capitalization in excess of $24 billion, Transocean Inc.’s ordinary shares are traded on the New York Stock Exchange under the symbol “RIG.”

		###		07-18

TRANSOCEAN INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per share data)
(Unaudited)

		Three months ended March 31,
		2007				2006
Operating Revenues
Contract drilling revenues		$	1,273			$	779
Other revenues			55				38
			1,328				817
Costs and Expenses
Operating and maintenance			568				475
Depreciation			100				102
General and administrative			26				20
			694				597
Gain from disposal of assets, net			23				64
Operating Income			657				284
Other Income (Expense), net
Interest income			5				5
Interest expense, net of amounts capitalized			(37	)			(24	)
Other, net			13				1
			(19	)			(18	)
Income Before Income Taxes			638				266
Income Tax Expense			85				60
Net Income		$	553			$	206
Earnings Per Share
Basic		$	1.90			$	0.63
Diluted		$	1.84			$	0.61
Weighted Average Shares Outstanding
Basic			290				325
Diluted			302				337

TRANSOCEAN INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions, except share data)

		March 31,				December 31,
		2007				2006
		(Unaudited)
ASSETS
Cash and Cash Equivalents		$	502			$	467
Accounts Receivable, net of allowance for doubtful accounts of $24 and $26 at March 31, 2007 and December 31, 2006, respectively			1,085				946
Materials and Supplies, net of allowance for obsolescence of $21 and $19 at March 31, 2007 and December 31, 2006, respectively			168				160
Deferred Income Taxes, net			16				16
Other Current Assets			48				67
Total Current Assets			1,819				1,656
Property and Equipment			10,866				10,539
Less Accumulated Depreciation			3,298				3,213
Property and Equipment, net			7,568				7,326
Goodwill			2,195				2,195
Other Assets			301				299
Total Assets		$	11,883			$	11,476
LIABILITIES AND SHAREHOLDERS’ EQUITY
Accounts Payable		$	354			$	477
Accrued Income Taxes			136				98
Debt Due Within One Year			—				95
Other Current Liabilities			469				369
Total Current Liabilities			959				1,039
Long-Term Debt			3,484				3,200
Deferred Income Taxes, net			52				54
Other Long-Term Liabilities			508				343
Total Long-Term Liabilities			4,044				3,597
Commitments and Contingencies
Minority Interest			2				4
Preference Shares, $0.10 par value; 50,000,000 shares authorized, none issued and outstanding			—				—
Ordinary Shares, $0.01 par value; 800,000,000 shares authorized, 288,053,348 and 292,454,457 shares issued and outstanding at March 31, 2007 and December 31, 2006, respectively			3				3
Additional Paid-in Capital			7,675				8,044
Accumulated Other Comprehensive Loss			(30	)			(30	)
Accumulated Deficit			(770	)			(1,181	)
Total Shareholders’ Equity			6,878				6,836
Total Liabilities and Shareholders’ Equity		$	11,883			$	11,476

TRANSOCEAN INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
(Unaudited)

		Three months ended March 31,
		2007				2006
Cash Flows from Operating Activities
Net income		$	553			$	206
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation			100				102
Share-based compensation expense			10				3
Deferred income taxes			(2	)			34
Net gain from disposal of assets			(23	)			(64	)
Deferred income, net			34				9
Deferred expenses, net			(7	)			(8	)
Other long-term liabilities			7				7
Other, net			(1	)			1
Changes in operating assets and liabilities Accounts receivable			(139	)			(71	)
Accounts payable and other current liabilities			83				44
Income taxes receivable/payable, net			43				6
Other current assets			(4	)			(1	)
Net Cash Provided by Operating Activities			654				268
Cash Flows from Investing Activities
Capital expenditures			(465	)			(178	)
Proceeds from disposal of assets, net			39				82
Joint ventures and other investments, net			(3	)			—
Net Cash Used in Investing Activities			(429	)			(96	)
Cash Flows from Financing Activities
Borrowings under the Revolving Credit Facility, net			190				—
Net proceeds from issuance of ordinary shares under share-based compensation plans			15				45
Repurchase of ordinary shares			(400	)			(200	)
Other, net			5				—
Net Cash Used in Financing Activities			(190	)			(155	)
Net Increase in Cash and Cash Equivalents			35				17
Cash and Cash Equivalents at Beginning of Period			467				445
Cash and Cash Equivalents at End of Period		$	502			$	462

Transocean Inc. and Subsidiaries
Fleet Operating Statistics

		Operating Revenues (in millions) (1)
		Three months ended
		March 31,				December 31,				March 31,
		2007				2006				2006
Transocean Drilling Segment:
Contract Drilling Revenues
High-Specification Floaters:
Ultra-Deepwater Floaters		$	340			$	304			$	225
Other Deepwater Floaters			260				264				172
Other High-Specification Floaters			85				66				51
Total High-Specification Floaters			685				634				448
Other Floaters			379				296				166
Jackups			194				199				143
Other Rigs			15				18				21
Subtotal			1,273				1,147				778
Other Revenues
Client Reimbursable Revenues			38				32				25
Integrated Services and Other			17				7				14
Subtotal			55				39				39
Total Company		$	1,328			$	1,186			$	817

		Average Dayrates (1)
		Three months ended
		March 31,				December 31,				March 31,
		2007				2006				2006
Transocean Drilling Segment:
High-Specification Floaters:
Ultra-Deepwater Floaters		$	301,400			$	275,300			$	209,000
Other Deepwater Floaters		$	235,800			$	230,400			$	154,000
Other High-Specification Floaters		$	238,800			$	187,400			$	158,800
Total High-Specification Floaters		$	264,800			$	243,600			$	178,200
Other Floaters		$	223,700			$	178,400			$	110,000
Jackups		$	104,600			$	97,000			$	70,300
Other Rigs		$	50,300			$	48,200			$	47,300
Total Drilling Fleet		$	198,000			$	171,700			$	119,600

		Utilization (1)
		Three Months Ended
		March 31,				December 31,				March 31,
		2007				2006				2006
Transocean Drilling Segment:
High-Specification Floaters:
Ultra Deepwater Floaters			97	%			92	%			92	%
Other Deepwater Floaters			77	%			78	%			83	%
Other High-Specification Floaters			99	%			97	%			89	%
Total High-Specification Floaters			87	%			86	%			87	%
Other Floaters			94	%			90	%			73	%
Jackups			83	%			89	%			91	%
Other Rigs			100	%			99	%			58	%
Total Drilling Fleet			88	%			89	%			82	%

Transocean Inc. and Subsidiaries
Non-GAAP Financial Measures and Reconciliations

Operating Income Before General and Administrative Expense to
Field Operating Income
(In millions)

		Three Months Ended
		March 31,				December 31,				March 31,
		2007				2006				2006
Transocean Drilling Segment
Operating revenue		$	1,328			$	1,186			$	817
Operating and maintenance expense			568				570				475
Depreciation			100				98				102
(Gain) loss from disposal of assets, net			(23	)			(183	)			(64	)
Operating income before general and administrative expense			683				701				304
Add back (subtract): Depreciation			100				98				102
(Gain) loss from disposal of assets, net			(23	)			(183	)			(64	)
Field operating income			760			$	616			$	$342

Transocean Inc. and Subsidiaries
Effective Tax Rate Analysis
(In millions)

		Three Months Ended												Twelve Months Ended
		March 31,				Dec. 31				March 31,				Dec. 31
		2007				2006				2006				2006
Income (Loss) before Income Taxes and Minority Interest		$	638			$	693			$	266			$	1,607
Add back (subtract):
Gain on sale of assets			(23	)			(191	)			(65	)			(410	)
Income from TODCO tax sharing agreement			—				(51	)			—				(51	)
Adjusted Income before Income Taxes		$	615			$	451			$	201			$	1,146
Income Tax Expense		$	85			$	72			$	60			$	222
Add back (subtract):
Gain on sale of assets			(3	)			1				(22	)			(24	)
Changes in estimates (1)			2				17				(3	)			14
Adjusted Income Tax Expense (2)		$	84			$	90			$	35			$	212
Effective Tax Rate (3)			13.3	%			10.4	%			22.7	%			13.8	%
Annual Effective Tax Rate (4)			13.7	%			20.0	%			17.6	%			18.5	%