~~Table~~UNITED ~~of Contents~~STATES

~~UNITED~~SECURITIES ~~STATES~~AND EXCHANGE COMMISSION

~~SECURITIES~~Washington, ~~AND~~D.C. ~~EXCHANGE COMMISSION~~ 20549

~~Washington, D.C. 20549~~ _____________________________________________________________________________________

FORM 10-K

~~x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934~~_____________________________________________________________________________________

~~For~~x ~~the~~ANNUAL ~~fiscal~~REPORT ~~year~~PURSUANT ~~ended~~TO ~~December 31,~~SECTION ~~2012~~13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

¨For ~~TRANSITION~~the ~~REPORT~~fiscal ~~PURSUANT~~year TOended ~~SECTION~~December 31, 132016 ~~OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934~~

~~For~~¨ ~~the~~TRANSITION ~~transition~~REPORT ~~period~~PURSUANT ~~from to~~ TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: ~~000~~001-~~53604~~ 36211

~~NOBLE CORPORATION~~ _____________________________________________________________________________________

~~(Exact~~Noble ~~name~~Corporation ~~of registrant as specified in its charter)~~ plc

Switzerland		98-0619597
(State or other jurisdiction of incorporation or organization)		(I.R.S. employer identification number)
Dorfstrasse 19A, Baar, Switzerland		6340
(Address of principal executive offices)		(Zip Code)

(Exact name of registrant as specified in its charter)

~~Registrant’s telephone number, including area code: 41 (41) 761-65-55~~ _____________________________________________________________________________________

Securities registered pursuant to Section 12(b) of the Act:



England and Wales (Registered Number 08354954)		98-0619597
(State or other jurisdiction of incorporation or organization)		(I.R.S. employer identification number)

Title of each class		Name of each exchange on which registered
Shares, Par Value 3.15 CHF per Share		New York Stock Exchange

Devonshire House, 1 Mayfair Place, London, England, W1J 8AJ

~~Commission~~(Address ~~file~~of ~~number:~~principal ~~001-31306~~executive offices) (Zip Code)

~~NOBLE~~Registrant’s ~~CORPORATION~~telephone number, including area code: +44 20 3300 2300

~~(Exact~~Securities ~~name~~registered ofpursuant ~~registrant~~to asSection 12(b) ~~specified~~of inthe ~~its charter)~~ Act:

Cayman Islands		98-0366361
Title of each class		Name of each exchange on which registered
(State or other jurisdiction of incorporation or organization)		(I.R.S. employer identification number)
Shares, Nominal Value $0.01 per Share		New York Stock Exchange

~~Suite~~Commission 3Dfile ~~Landmark~~number: ~~Square, 64 Earth Close, P.O. Box 31327~~ 001-31306

~~George Town, Grand Cayman, Cayman Islands KY1-1206~~ _____________________________________________________________________________________

~~(Address~~Noble ~~of principal executive offices) (Zip Code)~~ Corporation

~~Registrant’s telephone~~(Exact ~~number,~~name ~~including~~of ~~area~~registrant ~~code:~~as ~~(345) 938-0293~~specified in its charter)

~~Securities registered pursuant to Sections 12(b) and 12(g) of the Act: None~~ _____________________________________________________________________________________

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes x No ¨



Cayman Islands		98-0366361
(State or other jurisdiction of incorporation or organization)		(I.R.S. employer identification number)

~~Indicate~~Suite by3D ~~check~~Landmark ~~mark~~Square, if64 ~~the~~Earth ~~registrant~~Close, ~~is not required to file reports pursuant to Section 13 or Section 15(d) of the Act~~P. ~~Yes ¨ No x~~O. Box 31327

~~Indicate by~~George ~~check~~Town, ~~mark~~Grand ~~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~~Cayman, ~~and~~Cayman ~~(2) has~~Islands ~~been subject to such filing requirements for the past 90 days. Yes x No ¨~~ KY1-1206

~~Indicate~~(Address ~~by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405~~ of ~~Regulation~~principal ~~S-T~~executive ~~during~~offices) ~~the~~(Zip ~~preceding 12 months. Yes x No ¨~~ Code)

~~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~~Registrant’s ~~knowledge~~telephone number, inincluding ~~definitive~~area ~~proxy or information statements incorporated by reference in Part III of this Form 10~~code: (345) 938-~~K or any amendment to this Form 10-K. ¨~~ 0293

~~Indicate~~Securities byregistered ~~check~~pursuant ~~mark~~to ~~whether~~Sections ~~the~~12(b) ~~registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer”~~ and ~~“smaller~~12(g) ~~reporting company” in Rule 12b-2~~ of the ~~Exchange~~ Act. :

Noble Corporation (Switzerland): Large accelerated filer x Accelerated filer ¨ Non-accelerated filer ¨ Smaller reporting company ¨ Noble Corporation (Cayman Islands): Large accelerated filer ¨ Accelerated filer ¨ Non-accelerated filer x Smaller reporting company ¨None

~~Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x~~ _________________________________________________________________________________

AsIndicate ofby ~~June 29,~~check ~~2012,~~mark ~~the~~if ~~aggregate market value of~~ the ~~registered~~registrant ~~shares~~is ofa ~~Noble Corporation (Switzerland) held by non~~well-~~affiliates~~known ofseasoned ~~the~~issuer, ~~registrant~~as ~~was~~defined ~~$8.1~~in ~~billion~~Rule ~~based~~405 onof the ~~closing~~Securities ~~sale price as reported on the New York Stock Exchange~~Act. Yes x No ¨

~~Number~~Indicate ofby ~~shares~~check ~~outstanding~~mark ~~and~~if ~~trading~~the atregistrant ~~February 11,~~is ~~2013:~~not ~~Noble~~required ~~Corporation~~ to file reports pursuant to Section 13 or Section 15(~~Switzerland~~d) –of ~~253,225,668~~the Act. Yes ¨ No x

~~Number~~Indicate ofby ~~shares~~check ~~outstanding:~~mark ~~Noble~~whether ~~Corporation~~the registrant (~~Cayman~~1) has ~~Islands~~filed all reports required to be filed by Section 13 or 15(d) –of ~~261~~the Securities Exchange Act of 1934 during the preceding 12 months,~~245,693~~ and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

~~DOCUMENTS~~Indicate ~~INCORPORATED~~by BYcheck ~~REFERENCE~~mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months. Yes x No ¨

~~The~~Indicate ~~proxy~~by ~~statement~~check ~~for~~mark ~~the~~if ~~2013~~disclosure ~~annual~~of ~~general~~delinquent ~~meeting~~filers ofpursuant ~~the~~to ~~shareholders~~Item 405 of ~~Noble~~Regulation ~~Corporation~~S-K ~~(Switzerland)~~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 ~~into~~in Part III of this Form 10-K. or any amendment to this Form 10-K. x

~~This~~Indicate ~~Form~~by ~~10-K~~check ismark awhether ~~combined~~the ~~annual~~registrant ~~report~~is ~~being~~a ~~filed~~large ~~separately~~accelerated byfiler, ~~two~~an ~~registrants:~~accelerated ~~Noble Corporation~~filer, a ~~Swiss corporation (“Noble~~non-~~Swiss”),~~accelerated ~~and its wholly-owned subsidiary Noble Corporation~~filer, or a ~~Cayman~~smaller ~~Islands~~reporting company ~~(“Noble-Cayman”)~~. ~~Noble-Cayman~~See ~~meets~~ the ~~conditions~~definitions ~~set~~of ~~forth~~“large inaccelerated ~~General~~filer,” ~~Instructions~~“accelerated Ifiler” ~~(1) of Form 10-K~~ and is“smaller ~~therefore~~reporting ~~filing this~~company” ~~Form~~in 10Rule 12b-K2 ~~with~~of the ~~reduced~~Exchange ~~disclosure format contemplated by paragraphs (a) and (c) of General Instruction I(2) of Form 10-K~~Act.

~~Table~~Noble ofCorporation ~~Contents~~plc: Large accelerated filer x Accelerated filer ¨ Non-accelerated filer ¨ Smaller reporting company ¨

~~TABLE~~Noble OFCorporation: ~~CONTENTS~~Large accelerated filer ¨ Accelerated filer ¨ Non-accelerated filer x Smaller reporting company

		PAGE
PART I
Item 1.	Business		1
Item 1A.	Risk Factors		8
Item 1B.	Unresolved Staff Comments		17
Item 2.	Properties		17
Item 3.	Legal Proceedings		21
Item 4.	Mine Safety Disclosures		21
PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities		21
Item 6.	Selected Financial Data		25
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		25
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk		43
Item 8.	Financial Statements and Supplementary Data		45
Item 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure		102
Item 9A.	Controls and Procedures		102
Item 9B.	Other Information		103
PART III
Item 10.	Directors, Executive Officers and Corporate Governance		103
Item 11.	Executive Compensation		105
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters		105
Item 13.	Certain Relationships, Related Transactions and Director Independence		105
Item 14.	Principal Accounting Fees and Services		105
PART IV
Item 15.	Exhibits, Financial Statement Schedules		105
SIGNATURES			106

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

~~This~~As ~~combined~~of ~~Annual Report on Form 10-K is separately filed by Noble Corporation~~June 30, ~~a Swiss corporation (“Noble-Swiss”)~~2016, ~~and~~the ~~Noble~~aggregate ~~Corporation,~~market avalue ~~Cayman~~of ~~Islands~~the ~~company~~registered ~~(“Noble-Cayman”).~~shares ~~Information~~of ~~in this filing relating to~~ Noble~~-Cayman~~ isCorporation ~~filed~~plc byheld ~~Noble-Swiss and separately~~ by ~~Noble~~non-~~Cayman~~affiliates onof ~~its~~the ~~own~~registrant ~~behalf~~was $2.0 ~~Noble-Cayman~~billion ~~makes no~~based ~~representation~~on asthe toclosing ~~information~~sale ~~relating~~price ~~to Noble-Swiss (except~~ as itreported ~~may~~on ~~relate~~the toNew ~~Noble-Cayman)~~York orStock ~~any other affiliate or subsidiary of Noble-Swiss~~Exchange.

~~This~~Number ~~report~~of ~~should~~shares beoutstanding ~~read in its entirety as it pertains to each Registrant. Except where indicated, the Consolidated Financial Statements~~ and ~~the~~trading ~~Notes~~at ~~to the Consolidated Financial Statements are combined. References in this Annual Report on Form 10-K to “Noble~~February 15,” ~~the~~2017: ~~“Company,” “we,” “us,” “our” and words of similar meaning refer collectively to~~ Noble~~-Swiss~~ ~~and~~Corporation ~~its~~plc ~~consolidated~~– ~~subsidiaries~~244, ~~including Noble-Cayman.~~ 676,954

~~Table~~Number of ~~Contents~~shares outstanding: Noble Corporation – 261,245,693

~~PART~~DOCUMENTS IINCORPORATED BY REFERENCE

~~Item~~The 1.proxy ~~Business~~statement for the 2017 annual general meeting of the shareholders of Noble Corporation plc will be incorporated by reference into Part III of this Form 10-K.

This Form 10-K is a combined annual report being filed separately by two registrants: Noble Corporation plc, a public limited company incorporated under the laws of England and Wales (“Noble-UK”), and its wholly-owned subsidiary, Noble Corporation, a Cayman Islands company (“Noble-Cayman”). Noble-Cayman meets the conditions set forth in General Instructions I(1) of Form 10-K and is therefore filing this Form 10-K with the reduced disclosure format contemplated by paragraphs (a) and (c) of General Instruction I(2) of Form 10-K.

~~Noble~~TABLE ~~Corporation,~~OF a Swiss corporation, is a leading offshore drilling contractor for the oil and gas industry. We perform contract drilling services with our fleet of 79 mobile offshore drilling units located worldwide. We also own one floating production storage and offloading unit. Our fleet consists of 14 semisubmersibles, 14 drillships, 49 jackups and two submersibles, including 11 units under construction as follows: CONTENTS

• five dynamically positioned, ultra-deepwater, harsh environment drillships and



		PAGE
PART I
Item 1.	Business	2
Item 1A.	Risk Factors	10
Item 1B.	Unresolved Staff Comments	23
Item 2.	Properties	23
Item 3.	Legal Proceedings	26
Item 4.	Mine Safety Disclosures	26

PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	26
Item 6.	Selected Financial Data	29
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	43
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	47
Item 8.	Financial Statements and Supplementary Data	49
Item 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	109
Item 9A.	Controls and Procedures	109
Item 9B.	Other Information	109

PART III
Item 10.	Directors, Executive Officers and Corporate Governance	110
Item 11.	Executive Compensation	111
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	111
Item 13.	Certain Relationships, Related Transactions and Director Independence	111
Item 14.	Principal Accounting Fees and Services	111

PART IV
Item 15.	Exhibits, Financial Statement Schedules	112
Item 16.	Form 10-K Summary	112

SIGNATURES		113

•This ~~six~~combined ~~high~~Annual Report on Form 10-~~specification~~K is separately filed by Noble Corporation, ~~heavy~~a Cayman Islands company (“Noble-~~duty~~Cayman”). Noble Corporation plc, ~~harsh~~a ~~environment~~public ~~jackups~~limited company incorporated under the laws of England and Wales (“Noble-UK”) filed its own combined Annual Report on Form 10-K previously on February 24, 2017. Information in this filing relating to Noble-Cayman is filed by Noble-UK and separately by Noble-Cayman on its own behalf. Noble-Cayman makes no representation as to information relating to Noble-UK (except as it may relate to Noble-Cayman) or any other affiliate or subsidiary of Noble-UK.

~~For~~This ~~additional~~report ~~information~~should onbe read in its entirety as it pertains to each Registrant. Except where indicated, the ~~specifications~~Consolidated ofFinancial ~~our~~Statements ~~fleet~~and the Notes to the Consolidated Financial Statements are combined. References in this Annual Report on Form 10-K to “Noble,” ~~see~~the “~~Item~~Company,” 2.“we,” ~~Properties.—Drilling~~“us,” ~~Fleet.~~“our” Asand words of ~~February~~ similar meaning refer collectively to Noble-UK and its consolidated subsidiaries, including Noble-Cayman after November 720, 2013 and to Noble Corporation, ~~approximately~~a 85Swiss ~~percent~~corporation of(“Noble-Swiss”), ~~our~~and ~~fleet~~its ~~was~~consolidated ~~located~~subsidiaries ~~outside~~for ~~the~~periods ~~United~~through ~~States~~November 20, in2013. ~~the~~Noble-UK ~~following~~became ~~areas:~~a ~~Mexico,~~successor ~~Brazil,~~registrant to Noble-Swiss under the ~~North~~Securities ~~Sea~~Exchange Act of 1934, as amended (the ~~Mediterranean~~“Exchange Act”), ~~West~~pursuant ~~Africa,~~to Rule 12g-3 of the ~~Middle~~Exchange ~~East,~~Act ~~India~~as ~~and~~a ~~Australia.~~result ~~Noble~~of ~~and~~the ~~its predecessors~~consummation ~~have~~of ~~been~~the ~~engaged~~Transaction described in ~~the~~Part ~~contract~~I, ~~drilling~~Item 1 of ~~oil~~this ~~and~~Annual ~~gas~~Report ~~wells~~on ~~since~~Form ~~1921~~10-K.

~~Business~~PART ~~Strategy~~ I

~~Our~~Item ~~goal~~1. ~~is to be the preferred offshore drilling contractor for the oil and gas industry based upon the following overriding principles:~~ Business.

~~• operate in a manner that provides a safe working environment for our employees while protecting the environment and our assets;~~General

•Noble ~~provide~~Corporation anplc, ~~attractive~~a ~~investment~~public ~~vehicle~~limited company incorporated under the laws of England and Wales (“Noble-UK”), is a leading offshore drilling contractor for the oil and gas industry. We perform contract drilling services with our ~~shareholders;~~global fleet of mobile offshore drilling units. As of the filing date of this Annual Report on Form 10-K, our fleet of 28 drilling rigs consisted of 14 jackups, eight drillships and six semisubmersibles.

•For ~~deliver~~additional ~~exceptional~~information ~~customer~~on ~~service~~the ~~through~~specifications aof ~~large~~our fleet, ~~diverse~~see ~~and~~Part ~~technically~~I, ~~advanced~~Item 2, “Properties—Drilling Fleet.” At December 31, 2016, our fleet ~~operated~~was bylocated ~~competent~~in ~~personnel~~the United States, the North Sea, South Africa, the Middle East and Asia. Noble and its predecessors have been engaged in the contract drilling of oil and gas wells since 1921.

WeSpin-off ~~have actively expanded our offshore drilling and deepwater capabilities in recent years through the construction and acquisition~~ of ~~rigs.~~Paragon AsOffshore ~~part~~plc of(“Paragon this technical and operational expansion, we plan to continue pursuing opportunities to upgrade our fleet to achieve greater technological capability, which we believe will lead to increased drilling efficiencies and the ability to complete the increasingly more complex well programs required by our customers. Offshore”)

~~Our~~On ~~business strategy~~August 1, ~~also~~2014, ~~focuses~~Noble-UK oncompleted the ~~active~~separation ~~expansion~~and spin-off of ~~our~~a ~~worldwide~~majority ~~deepwater~~of ~~capabilities~~its standard specification offshore drilling business (the “Spin-off”) through ~~upgrades~~a ~~and~~pro ~~modifications~~rata distribution of all of the ordinary shares of its wholly-owned subsidiary, ~~acquisitions~~Paragon ~~and~~Offshore, ~~divestitures~~to the holders of Noble’s ordinary shares. Our shareholders received one share of Paragon Offshore for every three shares of Noble owned as of July 23, 2014, the record date for the distribution. Through the Spin-off, we disposed of most of our standard specification drilling units and related assets, asliabilities ~~well~~and asbusiness. Prior to the ~~deployment~~Spin-off, Paragon Offshore issued approximately $1.7 billion of long-term debt. We used the proceeds from this debt to repay certain amounts outstanding under our ~~drilling~~commercial ~~assets~~paper ~~in important~~program. ~~oil~~The ~~and~~results ~~gas~~of ~~producing~~operations ~~areas~~for ~~throughout~~Paragon Offshore prior to the ~~world~~Spin-off date and incremental Spin-off related costs have been classified as discontinued operations for all periods presented in this Annual Report on Form 10-K.

~~During~~For ~~2012,~~additional weinformation ~~continued~~regarding the Spin-off and our ~~newbuild~~current ~~program~~relationship with ~~the~~Paragon ~~following 14~~Offshore, ~~projects:~~see Part II, Item 8, “Financial Statements and Supplementary Data, Note 2—Spin-off of Paragon Offshore plc ("Paragon Offshore")” and Part II, Item 8, “Financial Statements and Supplementary Data, Note 17—Commitments and Contingencies.”

•Consummation ~~we commenced operations on three dynamically positioned ultra-deepwater, harsh environment drillships: two Bully-class drillships currently operating in the U.S. Gulf~~ of ~~Mexico~~Merger and ~~Brazil, respectively, and one Globetrotter-class drillship currently operating in the U.S. Gulf of Mexico;~~Redomiciliation

•On weNovember 20, ~~continued~~2013, ~~construction~~pursuant onto ~~one~~the ~~dynamically~~Merger ~~positioned~~Agreement dated as of June 30, ~~ultra~~2013 between Noble Corporation, a Swiss corporation (“Noble-~~deepwater~~Swiss”), ~~harsh~~and ~~environment~~Noble-UK, ~~Globetrotter~~Noble-~~class~~Swiss ~~drillship~~merged with and into Noble-UK, ~~which~~with isNoble-UK ~~scheduled~~as tothe besurviving ~~delivered~~company to(the ~~our~~“Transaction”). ~~customer~~In the Transaction, all of the outstanding ordinary shares of Noble-Swiss were cancelled, and Noble-UK issued, through an exchange agent, one ordinary share of Noble-UK in exchange for each ordinary share of Noble-Swiss. The Transaction effectively changed the ~~fourth~~place ~~quarter~~of incorporation of ~~2013;~~our publicly traded parent holding company from Switzerland to the United Kingdom.

•Noble weCorporation, ~~continued~~a ~~construction~~Cayman onIslands ~~four~~company ~~dynamically~~(“Noble-Cayman”), ~~positioned~~is an indirect, ~~ultra~~wholly-~~deepwater~~owned subsidiary of Noble-UK, ~~harsh~~our ~~environment~~publicly-traded ~~drillships~~parent atcompany. ~~Hyundai~~Noble-UK’s ~~Heavy~~principal ~~Industries~~asset ~~Co.~~is ~~Ltd.,~~all of the ~~first~~shares of ~~which~~Noble-Cayman. isNoble-Cayman ~~estimated~~has tono bepublic ~~delivered~~equity ~~from~~outstanding. ~~the~~The ~~shipyard~~consolidated infinancial statements of Noble-UK include the ~~second~~accounts ~~quarter~~of Noble-Cayman, and Noble-UK conducts substantially all of ~~2013;~~its business through Noble-Cayman and its subsidiaries.

•Business ~~we continued construction on six high-specification, heavy duty, harsh environment jackups, the first of which is estimated to be delivered from the shipyard in the second quarter of 2013.~~Strategy

~~Capital~~Our ~~expenditures,~~goal ~~including~~is ~~expenditures~~to ~~related~~be tothe preferred offshore drilling contractor for the ~~items noted~~oil ~~above,~~and ~~totaled~~gas ~~$1.7~~industry ~~billion~~based ~~during~~upon ~~2012.~~the following core principles:

1• operate in a manner that provides a safe working environment for our employees while protecting the environment and our assets;

~~Table~~• ofprovide ~~Contents~~an attractive investment vehicle; and

As• ~~part~~deliver ofsuperior ~~our~~customer ~~ongoing~~service ~~strategic~~through planning process, we review our fleet and the strategic benefits of our drilling rigs. As part of this process, we continue to analyze potential divestment of certain of our standard specification units and related assets in one or more transactions. These dispositions may include sales of assets to third parties, a ~~spin-off,~~diverse or other distribution or separation of assets or a combination of such transactions. In analyzing our disposition alternatives, we consider the strategic benefit to our ongoing operations while seeking to secure what we consider appropriate value for our shareholders. While we may continue to operate some or all standard specification drilling rigs, we have taken certain preliminary steps to put ourselves in a better position to pursue a potential spin-off and~~/or sale~~ ~~should~~technically weadvanced ~~decide~~fleet tooperated doby ~~so.~~proficient These include analyzing the internal restructuring steps necessary for a potential spin-off or sale and related tax considerations, seeking certain preparatory tax rulings and commencing preparation of financial statements for a potential separate group that could be spun off or soldcrews. We have not completed the preliminary work to effect, nor has our board of directors approved, any such transactions. We make no assurance that we will ultimately undertake or consummate any sale, spin-off or separation transactions involving our standard specification assets.

WeOur ~~have~~business ~~entered~~strategy ~~into~~focuses ~~an agreement~~on toa ~~sell~~balanced ~~our~~fleet ~~jackup,~~of ~~the~~both ~~Noble~~deepwater ~~Lewis~~and ~~Dugger,~~high-specification tojackup aassets ~~third party that owns~~ and ~~operates~~the ~~supply~~deployment ~~vessels,~~of ~~platform~~our drilling rigs ~~and jackups~~ in ~~Mexico. This~~important ~~unit~~oil ~~is being sold for $61 million~~ and ~~the~~gas ~~closing~~basins isaround ~~expected to occur in~~ the ~~second quarter of 2013 after the unit has completed its contract with its current customer~~world. The transaction is subject to customary closing conditions. We had entered into an agreement to sell the Noble Don Walker for $18 million. The buyer was unable to close the transaction, although we remain in discussions to potentially extend the sale agreement. The unit has been cold-stacked in Cameroon since 2009.

~~Demand~~Over ~~for~~the ~~our~~past ~~services~~five isyears, awe ~~function~~have ofexpanded ~~the~~our ~~worldwide~~drilling ~~supply~~and offleet ~~mobile~~through ~~offshore~~our ~~drilling~~newbuild ~~units~~program. ~~Industry~~We ~~analysts~~took ~~widely~~delivery ~~acknowledge that a significant expansion~~ of ~~industry~~our ~~supply~~remaining ofnewbuild, ~~both~~the ~~jackups and ultra~~heavy-~~deepwater~~duty, ~~units~~harsh ~~has~~environment ~~commenced~~jackup, ~~the~~Noble ~~majority~~Lloyd ofNoble, ~~which~~in ~~currently~~July ~~have no contract~~2016. The ~~introduction~~Noble ofLloyd ~~non-contracted~~Noble ~~rigs~~commenced ~~into~~operations ~~the~~in ~~marketplace~~November ~~will~~2016 ~~increase~~under ~~the~~a ~~supply~~four-year ofcontract ~~rigs which~~in ~~compete~~the ~~for~~North ~~drilling~~Sea. ~~service~~Although ~~contracts, which could negatively impact the dayrates~~ we ~~are~~plan ~~able~~ to ~~achieve.~~focus ~~Our strategy~~ on ~~newbuild construction has generally been to expand our drilling fleet in connection with a long-term drilling contract that covers a substantial portion of our~~ capital ~~investment~~preservation and ~~provides~~liquidity anbased ~~acceptable return~~ on ~~our~~current ~~capital~~market ~~employed. However~~conditions, ~~in response to the addition of a significant number of new, technologically advanced units in the global fleet and changes in customer requirements and preferences,~~ we ~~believe~~also ~~that~~continue ~~in order~~ to ~~maintain~~evaluate ~~long-term~~opportunities ~~competitiveness, it has become both necessary and desirable for us~~ to ~~engage~~enhance inour ~~building speculative highly advanced jackups and floating units. Of the units we currently have under construction~~fleet, ~~two~~particularly offocusing ~~the~~on ~~ultra-deepwater~~higher ~~drillships~~specification ~~and two of the heavy-duty~~rigs, ~~harsh environment jackups are being constructed without customer contracts. We will attempt~~ to ~~secure~~execute ~~contracts~~the ~~for~~increasingly ~~these~~complex ~~units~~drilling ~~prior~~programs ~~to their~~required ~~completion. We may continue speculative building, even in the absence~~ of ~~contracts for~~ our ~~units already under construction~~customers.

~~From~~ time to time, we evaluate individual rig transactions and business combinations with other parties where we believe we can create shareholder value. We will continue to consider business opportunities that promote our growth strategy and optimize shareholder value. 2

InDemand ~~previous~~for ~~years~~our services is, ~~the~~in ~~drilling~~significant ~~industry~~part, ~~has experienced~~a ~~significant~~function ~~increases~~of inthe ~~dayrates~~worldwide demand for oil and gas and the global supply of mobile offshore drilling ~~services~~units. inIn ~~most~~recent ~~markets~~years, ~~coupled~~there ~~with~~has ~~higher~~been ~~demand~~a ~~for~~significant ~~drilling~~increase ~~equipment~~in ~~and~~the ~~shortages~~number of ~~personnel~~jackups and ultra-deepwater drilling units. ~~This~~Brent ~~environment~~crude ~~drove~~has ~~operating~~declined ~~costs~~from ~~higher~~approximately ~~and~~$112 ~~magnified~~per ~~the~~barrel ~~importance~~on ~~of recruiting~~June 30, ~~training~~2014 ~~and~~to ~~retaining~~as ~~skilled~~low ~~personnel.~~as ~~While~~approximately ~~there~~$30 ~~continues~~per barrel in January 2016, before improving to be$56 ~~instability~~per inbarrel ~~the~~on ~~global~~February ~~financial~~15, ~~markets~~2017. As wea ~~believe~~result, our customers have greatly reduced their exploration and development spending and the ~~current~~number ~~market~~of ~~offers~~rigs ~~limited~~they have under contract. This combination of increased supply of drilling rigs and ~~high~~reduced demand for ~~both~~such ~~our~~rigs ~~drilling~~has ~~units~~resulted ~~and~~in ~~the~~falling ~~pool~~dayrates ofand ~~qualified labor~~significantly reduced opportunities to ~~operate~~re-contract our rigs. upon expiry of existing contracts.

InDrilling recognition of the importance of our offshore operations personnel in achieving a safety record that has historically outperformed the offshore drilling industry sector and to retain such personnel, we have implemented a number of key operations personnel retention programs. We believe these programs are necessary to complement our other short and long-term incentive programs to attract and retain the skilled personnel we need to maintain safe and efficient operations. Contracts

2We typically employ each drilling unit under an individual contract. Although the final terms of the contracts result from negotiations with our customers, many contracts are awarded based upon a competitive bidding process. Our drilling contracts generally contain the following terms:

~~Table~~• contract duration extending over a specific period of ~~Contents~~time or a period necessary to drill a defined number wells;

~~Drilling~~• ~~Contracts~~payment of compensation to us (generally in U.S. Dollars although some customers, typically national oil companies, require a part of the compensation to be paid in local currency) on a “daywork” basis, so that we receive a fixed amount for each day (“dayrate”) that the drilling unit is operating under contract (a lower rate 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);

We• ~~typically~~provisions ~~employ~~permitting ~~each~~early ~~drilling~~termination ~~unit~~of ~~under~~the ~~an individual~~ contract. ~~Although~~by the ~~final~~customer ~~terms~~(i) ofif the ~~contracts~~unit ~~result~~is ~~from~~lost ~~negotiations~~or ~~with~~destroyed ~~our~~or ~~customers,~~(ii) ~~many~~if ~~contracts~~operations are ~~awarded~~suspended ~~based~~for ~~upon~~ a ~~competitive~~ ~~bidding~~specified ~~process.~~period ~~Our~~of ~~drilling~~time ~~contracts~~due ~~generally~~to ~~contain~~breakdown ~~the~~of ~~following~~equipment ~~terms:~~or breach of contract;

• ~~contract~~provisions ~~duration~~allowing ~~extending~~the ~~over~~impacted aparty ~~specific~~to ~~period~~terminate ofthe ~~time~~contract orif aspecified ~~period~~“force ~~necessary~~majeure” toevents ~~drill~~beyond the contracting parties’ control occur for a defined ~~number~~period ~~wells~~of time;

• ~~provisions~~payment ~~permitting~~by ~~early~~us ~~termination~~ of the ~~contract~~operating byexpenses ~~the~~of ~~customer (i) if~~ the drilling unit, isincluding ~~lost~~labor orcosts ~~destroyed~~and orthe ~~(ii)~~cost ~~if operations are suspended for a specified period~~ of ~~time~~incidental ~~due to breakdown of equipment~~supplies;

• provisions ~~allowing~~that ~~the~~allow ~~impacted~~us ~~party~~ to ~~terminate~~recover ~~the~~certain ~~contract~~cost ifincreases ~~specified~~from ~~“force~~our ~~majeure”~~customers ~~events~~in ~~beyond~~certain ~~the~~long-term ~~contracting parties’ control occur for a defined period of time~~contracts; and

• ~~payment~~provisions ofthat ~~compensation~~require to us ~~(generally in U.S. Dollars although some customers, typically national oil companies, require a part of the compensation~~ to belower ~~paid~~dayrates ~~in local currency) on a “daywork” basis, so that we receive a fixed amount~~ for ~~each~~documented ~~day~~cost ~~(“dayrate”)~~decreases ~~that the drilling unit is operating under contract (a lower rate or no compensation is payable during periods of equipment breakdown and repair or adverse weather or~~ in ~~the~~certain ~~event~~long-term ~~operations are interrupted by other conditions, some of which may be beyond our control);~~contracts.

•The ~~payment~~terms byof ussome of our drilling contracts permit the ~~operating~~customer ~~expenses~~to ofterminate the ~~drilling~~contract ~~unit,~~after ~~including~~specified ~~labor~~notice ~~costs~~periods ~~and~~by ~~the~~tendering ~~cost~~contractually ofspecified ~~incidental~~termination ~~supplies;~~amounts and, in certain cases, without any payment.

•Generally, ~~provisions~~our ~~that~~contracts allow us to recover ~~certain~~our ~~cost~~mobilization ~~increases~~and demobilization costs associated with moving a drilling unit from one regional location to another, although in the current depressed market, we may not recover some or all of these costs. When market conditions require us to assume these costs, our operating margins are reduced accordingly. For shorter moves, such as “field moves,” our customers have generally agreed to assume the costs of moving the unit in ~~certain~~the ~~long-term~~form ~~contracts~~of a reduced dayrate or “move rate” while the unit is being moved. Under current market conditions, we are much less likely to receive full reimbursement of our mobilization and demobilization costs.

~~The~~During ~~terms~~periods of ~~some~~depressed ofmarket ~~our~~conditions, ~~drilling~~such ~~contracts~~as ~~permit early termination of~~ the ~~contract~~one bywe ~~the~~are ~~customer,~~currently ~~without cause~~experiencing, ~~generally exercisable~~our ~~upon~~customers ~~advance~~may ~~notice~~attempt to usrenegotiate ~~and~~or inrepudiate ~~some~~their ~~cases without requiring an early termination payment to us. Our drilling~~ contracts with ~~Petróleos~~us ~~Mexicanos~~although ~~(“Pemex”)~~we inseek ~~Mexico,~~to ~~for~~enforce ~~example,~~our ~~allow~~rights ~~early~~under ~~cancellation~~our ~~with~~contracts. The 30renegotiations ~~days~~may ~~or less~~include ~~notice~~changes to uskey ~~without~~contract ~~Pemex~~terms, ~~making~~such anas ~~early~~pricing, termination ~~payment.~~and risk allocation.

~~Generally,~~For ~~our~~a ~~contracts~~discussion ~~allow~~of ~~us to recover~~ our ~~mobilization~~ ~~and~~backlog ~~demobilization~~of ~~costs~~commitments ~~associated~~for ~~with~~contract ~~moving a~~ drilling ~~unit from one regional location to another. When market conditions require us to assume these costs~~services, ~~our~~please ~~operating~~read ~~margins are reduced accordingly. We cannot predict our ability to recover these costs in the future. For shorter moves, such as~~ “~~field~~Management’s ~~moves,”~~Discussion ~~our~~and ~~customers~~Analysis ~~have~~of ~~generally~~Financial ~~agreed~~Condition toand ~~assume~~Results ~~the costs~~ of ~~moving~~Operations–Contract ~~the~~Drilling ~~unit~~Services ~~by paying us a reduced dayrate or “move rate” while the unit is being moved~~Backlog. ”

~~For~~Offshore ~~a discussion of our backlog of commitments for contract drilling services, please read “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Contract~~ Drilling ~~Services Backlog.”~~ Operations

~~Acquisition~~Contract ~~of Frontier~~Drilling ~~Holdings Limited~~ Services

OnWe ~~July~~conduct offshore contract drilling operations, which accounted for over 99 percent of our operating revenues for the years ended December 2831, ~~2010~~2016, ~~Noble-Swiss~~2015 and ~~Noble~~2014. AMDuring ~~Merger~~the ~~Co.~~three years ended December 31, a2016, ~~Cayman~~we ~~Islands~~principally ~~company~~conducted our contract drilling operations in the United States, the North Sea, the Middle East, Asia, Australia, and ~~indirect~~ ~~wholly-owned~~Brazil. Revenues ~~subsidiary~~from ofRoyal ~~Noble-Swiss~~Dutch Shell plc (“~~Merger Sub~~Shell”) and its affiliates accounted for approximately 38 percent, ~~completed~~49 ~~the~~percent ~~acquisition~~and 55 percent of ~~FDR~~our ~~Holdings~~consolidated ~~Limited~~operating revenues in 2016, a2015 ~~Cayman~~and ~~Islands~~2014, ~~company~~respectively. Revenues from Freeport-McMoRan Inc. (“~~Frontier~~Freeport”). ~~The~~accounted ~~Frontier~~for ~~acquisition~~approximately ~~was~~25 ~~for~~percent aand ~~purchase~~14 ~~price~~percent of ~~approximately~~our ~~$1.7 billion~~consolidated operating revenues in ~~cash~~2016 ~~plus~~and ~~liabilities~~2015, ~~assumed~~respectively. ~~The~~Freeport ~~acquisition~~did ~~strategically~~not ~~expanded~~account ~~and~~for ~~enhanced~~more than 10 percent of our ~~global~~consolidated ~~fleet~~operating revenues in 2014. ~~Frontier’s~~No ~~results~~other ofcustomer ~~operations~~accounted ~~were~~for ~~included~~more inthan 10 percent of our ~~results~~consolidated ~~beginning~~operating ~~July 28~~revenues in 2016, ~~2010.~~2015 or 2014.

~~Offshore~~ ~~Drilling~~On ~~Operations~~May 10, 2016, Freeport, Freeport-McMoRan Oil & Gas LLC and one of our subsidiaries entered into an agreement terminating the contracts on the Noble Sam Croft and the Noble Tom Madden (“FCX Settlement”), which were scheduled to end in July 2017 and November 2017, respectively. During 2016, we recognized approximately $393 million in “Contract drilling

~~Contract~~ ~~Drilling Services~~ 3

Weservices ~~conduct~~revenue” ~~offshore~~associated ~~contract~~with ~~drilling operations, which accounted for over 97 percent of our operating revenues for~~ the ~~years~~FCX ~~ended December 31, 2012, 2011 and 2010~~Settlement. WeOur ~~conduct~~primary ~~our~~customers ~~contract~~would ~~drilling operations~~have ~~principally~~been ~~in the U.S. Gulf of Mexico and Alaska~~Shell, ~~Mexico~~Anadarko, ~~Brazil, the North Sea, the Mediterranean, West Africa, the Middle East, India~~ and ~~Australia. Revenues from Royal Dutch Shell~~Freeport, ~~PLC~~accounting ~~(“Shell”) and its affiliates accounted~~ for approximately 3245 percent, 2411 percent, and 129 percent ~~of our total operating revenues in 2012~~, ~~2011 and 2010,~~ respectively~~. Revenues from Petróleo Brasileiro S.A. (“Petrobras”) accounted for approximately 14 percent~~, ~~18 percent and 19 percent~~ of our ~~total~~consolidated ~~operating~~operation revenues ~~in 2012~~, ~~2011~~excluding ~~and~~the ~~2010,~~$393 ~~respectively.~~million ~~Pemex did not account for more than 10 percent~~ of ~~our~~revenue ~~total~~attributable ~~operating~~to ~~revenues~~the inFCX ~~2012~~Settlement. ~~Revenues~~See ~~from~~Part ~~Pemex~~II, ~~accounted~~Item 8, ~~for~~“Financial ~~approximately~~Statements ~~15 percent~~ and 20Supplementary ~~percent~~Data, ~~of our~~Note ~~total~~3 ~~operating~~Contract ~~revenues~~Settlement ~~in 2011~~ and ~~2010,~~Termination ~~respectively.~~Agreement Nowith ~~other~~Freeport-McMoRan ~~single~~Inc." ~~customer accounted~~ for ~~more~~further ~~than 10 percent of our total operating revenues in 2012, 2011 or 2010~~information.

3 Competition

~~Table~~The offshore contract drilling industry is a highly competitive and cyclical business characterized by large capital expenditures and high operating and maintenance costs. We compete with other providers of ~~Contents~~offshore drilling rigs. Some of our competitors may have access to greater financial resources than we do.

~~Labor~~In ~~Contracts~~the provision of contract drilling services, competition involves numerous factors, including price, rig availability and technical specification, experience of the workforce, efficiency, safety performance record, condition and age of equipment, operating integrity, reputation, financial strength, industry standing and client relations although price and technical specification are among the most important factors. We believe that we compete favorably with respect to all of these factors. In addition to having one of the newest fleets in the industry among our peer companies, we follow a policy of keeping our equipment well-maintained and technologically competitive. However, our rigs could be made obsolete by the development of new techniques and equipment, regulations or customer preferences.

We ~~perform~~compete ~~services~~on a worldwide basis, but competition may vary by region. Demand for offshore drilling equipment also depends on the exploration and ~~workover~~development ~~activities~~programs ~~covering~~of ~~two~~oil ~~platforms~~and ~~off~~gas companies, which in turn are influenced by many factors, including the ~~east~~price ~~coast~~of oil and gas, the financial condition of ~~Canada;~~such ~~this~~companies, ~~contract~~general ~~extends~~global ~~through~~economic ~~April~~conditions, ~~2013.~~energy Wedemand, political doconsiderations ~~not~~and ~~own~~national oroil ~~lease~~and ~~these~~gas ~~platforms.~~policy, ~~Under~~many of which are beyond our ~~labor~~ ~~contracts~~control. In addition, weindustry-wide ~~provide~~shortages ~~the~~of supplies, services, skilled personnel and equipment necessary to ~~manage~~conduct ~~and~~our ~~perform~~business have historically occurred. While we do not anticipate this being an issue in the ~~drilling~~current ~~operations~~market ~~from~~environment, awe ~~drilling~~cannot ~~platform~~assure ~~owned~~that byany such shortages experienced in the ~~operator.~~past will not happen again in the future.

~~During~~Governmental ~~2011,~~Regulations ~~we commenced a refurbishment project with our customer, Shell, for one of its rigs. Under the contract, we provided the management~~ and ~~oversight~~Environmental of the project, as well as the personnel necessary to complete the refurbishment. During 2012, the construction phase of the project was completed and the rig began operating off the coast of Alaska. As with the Canadian labor contract noted above, we provide labor personnel and management services on the project but do not own or lease the related rig. Matters

~~Competition~~Political developments and numerous governmental regulations, which may relate directly or indirectly to the contract drilling industry, affect many aspects of our operations. Our contract drilling operations are subject to various laws and regulations in countries in which we operate, including laws and regulations relating to the equipping and operation of drilling units, environmental discharges and related recordkeeping, safety management systems, the reduction of greenhouse gas emissions to address climate change, currency conversions and repatriation, oil and gas exploration and development, taxation of offshore earnings and earnings of expatriate personnel and use of local employees, content and suppliers by foreign contractors. A number of countries actively regulate and control the ownership of concessions and companies holding concessions, the exportation of oil and gas and other aspects of the oil and gas industries in their countries. In addition, government actions, including initiatives by the Organization of Petroleum Exporting Countries (“OPEC”), may continue to contribute to oil price volatility. In some areas of the world, this government activity has adversely affected the amount of exploration and development work done by oil and gas companies and their need for offshore drilling services, and likely will continue to do so.

The ~~offshore~~regulations ~~contract~~applicable to our operations include provisions that regulate the discharge of materials into the environment or require remediation of contamination under certain circumstances. Many of the countries in whose waters we operate from time to time regulate the discharge of oil and other contaminants in connection with drilling ~~industry~~and ismarine aoperations. ~~highly~~Failure ~~competitive~~to comply with these laws and ~~cyclical~~regulations, ~~business~~or ~~characterized~~failure byto ~~high~~obtain ~~capital~~or comply with permits, may result in the assessment of administrative, civil and ~~maintenance~~criminal ~~costs~~penalties, imposition of remedial requirements and the imposition of injunctions to force future compliance. ~~Some~~ We are also subject to a plea agreement with the U.S. Department of ~~our~~Justice ~~competitors~~(“DOJ”) in connection with prior operations in Alaska, and any future environmental incidents could have an impact on the plea agreement or related actions that the DOJ or other regulatory agencies may take against us as a result of such an incident. We have ~~access~~made, and will continue to make, expenditures to comply with environmental requirements. We do not believe that our compliance with such requirements will have a material adverse effect on our results of operations, our competitive position or materially increase our capital expenditures. Although these requirements impact the oil and gas and energy services industries, generally they do not appear to affect us in any material respect that is different, or to any materially greater ~~financial~~or ~~resources~~lesser extent, than weother docompanies in the energy services industry. However, our business and prospects could be adversely affected by regulatory activity that prohibits or restricts our customers’ exploration and production activities, results in reduced demand for our services or imposes environmental protection requirements that result in increased costs to us, our customers or the oil and natural gas industry in general.

InThe ~~the~~following ~~provision~~is ofa ~~contract~~summary ~~drilling services,~~of ~~competition~~some ~~involves~~of ~~numerous~~the ~~factors,~~existing ~~including~~laws ~~price,~~and ~~rig~~regulations ~~availability~~that ~~and~~apply ~~suitability,~~in ~~experience~~the ofUnited ~~the~~States ~~workforce,~~and ~~efficiency~~Europe, ~~safety~~which ~~performance~~serves ~~record,~~as ~~condition~~an ~~and~~example ~~age~~ of ~~equipment,~~the ~~operating~~various ~~integrity,~~laws ~~reputation, industry standing~~ and ~~client~~regulations ~~relations.~~to Wewhich ~~believe that~~ we ~~compete~~are ~~favorably~~subject. ~~with~~While ~~respect~~laws tovary ~~all~~widely ofin ~~these~~each ~~factors.~~jurisdiction, Weeach ~~follow a policy~~ of ~~keeping~~the ~~our~~laws ~~equipment well maintained~~ and ~~technologically~~regulations ~~competitive.~~below ~~However,~~addresses ~~our~~environmental ~~equipment~~issues ~~could~~similar beto ~~made~~those ~~obsolete~~in ~~by the~~most ~~development~~ of ~~new~~the ~~techniques~~other ~~and~~jurisdictions ~~equipment,~~in ~~regulations~~which orwe ~~customer preferences~~operate.

We compete on a worldwide basis, but competition may vary by region at any 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, prices of oil and gas and by political considerations and policies. 4

InSpills ~~addition~~and Releases. The Comprehensive Environmental Response, ~~industry-wide~~ ~~shortages~~Compensation, ofand ~~supplies~~Liability Act in the U.S. (“CERCLA”), ~~services~~and similar state and foreign laws and regulations, ~~skilled~~impose ~~personnel~~joint and ~~equipment~~several ~~necessary~~liabilities, without regard to ~~conduct~~fault ~~our~~or ~~business~~the ~~have~~legality ~~historically~~of the original act, on certain classes of persons that contributed to the release of a “hazardous substance” into the environment. These persons include the “owner” and “operator” of the site where the release occurred, past owners and operators of the site, and companies that disposed or arranged for the disposal of the hazardous substances found at the site. WeResponsible ~~cannot~~parties ~~assure~~under CERCLA may be liable for the costs of cleaning up hazardous substances that ~~any~~have ~~such~~been ~~shortages~~released ~~experienced~~into inthe environment and for damages to natural resources. In the ~~past~~course ~~will~~of our ordinary operations, we may generate waste that may fall within CERCLA’s definition of a “hazardous substance.” However, we have to-date not ~~happen~~received ~~again~~any innotification ~~the~~that ~~future~~we are, or may be, potentially responsible for cleanup costs under CERCLA.

~~Governmental~~Offshore ~~Regulations~~Regulation and Safety. In response to the Macondo well blowout incident in April 2010, the U.S. Department of Interior, through the Bureau of Ocean Energy Management (“BOEM”) and the Bureau of Safety and Environmental ~~Matters~~Enforcement (“BSEE”), has undertaken an aggressive overhaul of the offshore oil and natural gas regulatory process that has significantly impacted oil and gas development in the U.S. Gulf of Mexico. From time to time, new rules, regulations and requirements have been proposed and implemented by BOEM, BSEE or the United States Congress that materially limit or prohibit, and increase the cost of, offshore drilling. For example, in July 2016, BOEM and BSEE finalized a rule revising and adding planning and operational requirements for drilling on the U.S. Arctic Outer Continental Shelf. The final rule became effective September 13, 2016. Similarly, in April 2016, BSEE published a final blowout preventer systems and well control rule. This rule focuses on blowout preventer requirements and includes reforms in well design, well control, casing, cementing, real-time well monitoring and subsea containment, among other things. Additionally, in December 2016, President Obama withdrew 115 million acres in the U.S. Arctic Ocean and 3.8 million acres off the U.S. North and Mid-Atlantic coasts from future oil and gas activity under the Outer Continental Shelf Lands Act (“OCSLA”). This withdrawal follows a March 2016 decision by BOEM to not include the Mid- and South Atlantic Program Areas from the proposed Leasing Program from 2017 to 2022. BOEM also released a new Notice to Lessees and Operators in the Outer Continental Shelf in September 2016 that updates offshore bonding requirements. BOEM also recently proposed a rule that would update identification, modeling, measuring, and tracking of air emissions from oil and gas activity in federal waters of the Western and Central Gulf of Mexico and the Arctic Ocean.

~~Political~~These ~~developments~~new ~~and~~rules, ~~numerous~~regulations ~~governmental~~and ~~regulations~~requirements, ~~which~~including ~~may~~the ~~relate~~adoption ~~directly~~of ornew ~~indirectly~~safety requirements and policies relating to the ~~contract~~approval of drilling ~~industry~~permits, ~~affect~~restrictions ~~many~~on ~~aspects~~oil ofand ~~our~~gas ~~operations.~~development ~~Our~~and ~~contract~~production ~~drilling operations~~activities ~~are~~in ~~subject~~the toU.S. ~~various~~Gulf ~~laws~~of Mexico and ~~regulations~~the inArctic, ~~countries~~implementation inof ~~which~~safety weand ~~operate,~~environmental ~~including~~management ~~laws~~systems, ~~and~~mandatory ~~regulations~~third ~~relating~~party tocompliance ~~the~~audits, ~~equipping~~ and ~~operation~~the promulgation of ~~drilling~~numerous ~~units,~~Notices ~~the~~to ~~reduction~~Lessees ofhave ~~greenhouse~~impacted ~~gas~~and ~~emissions~~may continue to ~~address~~impact ~~climate~~our ~~change, currency~~operations. ~~conversions~~In ~~and~~addition ~~repatriation~~to these rules, ~~oil~~regulations and ~~gas~~requirements, ~~exploration~~the ~~and~~U.S. ~~development,~~federal ~~taxation~~government ofis ~~offshore~~considering ~~earnings~~new ~~and~~legislation ~~earnings~~that ofcould ~~expatriate~~impose ~~personnel~~additional equipment and ~~use~~safety ofrequirements ~~local~~on ~~employees~~operators and ~~suppliers~~drilling bycontractors ~~foreign~~in ~~contractors~~the U.S. AGulf ~~number~~ of ~~countries~~Mexico, ~~actively regulate~~as ~~and~~well ~~control~~as regulations relating to the ~~ownership~~protection of ~~concessions~~the ~~and~~environment. ~~companies~~If ~~holding~~the ~~concessions~~new regulations, ~~the~~policies, ~~exportation~~operating procedures and possibility of ~~oil~~increased ~~and~~legal ~~gas~~liability ~~and~~are ~~other~~viewed ~~aspects~~by ofour ~~the~~current ~~oil~~or ~~and~~future ~~gas~~customers ~~industries~~as ina ~~their~~significant ~~countries.~~impairment Into ~~addition,~~expected ~~government~~profitability ~~action~~on projects, ~~including~~then ~~initiatives~~they bycould ~~the Organization~~discontinue ofor ~~Petroleum~~curtail ~~Exporting~~their ~~Countries~~offshore ~~(“OPEC”)~~operations in the impacted region, ~~may~~thereby ~~continue~~adversely toaffecting ~~contribute~~our tooperations ~~oil~~by ~~price~~limiting ~~volatility~~drilling opportunities or imposing materially increased costs. InWe ~~some~~are ~~areas~~also ofsubject to the ~~world,~~Ports ~~this~~and ~~governmental~~Waterways ~~activity~~Safety ~~has~~Act ~~adversely~~(“PWSA”) ~~affected~~and ~~the~~similar ~~amount~~regulations, ofwhich ~~exploration~~impose ~~and~~certain ~~development~~operational ~~work~~requirements ~~done by~~on ~~oil~~offshore ~~and~~rigs ~~gas~~operating ~~companies~~in the U.S. and ~~their~~governs ~~need~~liability for ~~drilling~~vessel ~~services,~~or ~~and~~cargo ~~likely~~loss, ~~will~~or ~~continue~~damage to dolife, ~~so.~~property, or the marine environment.

The ~~regulations~~Oil ~~applicable to~~Pollution ~~our~~Act. The ~~operations~~U.S. ~~include~~Oil ~~provisions~~Pollution ~~that~~Act ~~regulate~~of ~~the~~1990 ~~discharge~~(“OPA”) ofand ~~materials~~similar ~~into~~regulations, including but not limited to the ~~environment~~International orConvention ~~require~~for ~~remediation~~the Prevention of ~~contamination~~Pollution ~~under~~from ~~certain~~Ships ~~circumstances.~~(“MARPOL”), ~~Many~~adopted ofby the ~~countries~~International inMaritime ~~whose~~Organization ~~waters~~(“IMO”), weas ~~operate~~enforced ~~from~~in ~~time~~the toUnited ~~time~~States ~~regulate~~through the ~~discharge~~ ofdomestic ~~oil~~implementing ~~and~~law ~~other~~called ~~contaminants~~the inAct ~~connection~~to ~~with~~Prevent ~~drilling~~Pollution ~~operations.~~from ~~Failure~~Ships, toimpose ~~comply~~certain ~~with~~operational ~~these~~requirements ~~laws~~on ~~and~~offshore ~~regulations,~~rigs oroperating ~~failure~~in tothe ~~obtain~~U.S. orand ~~comply~~govern ~~with~~liability ~~permits~~for leaks, ~~may~~spills ~~result~~and inblowouts ~~the~~involving ~~assessment~~pollutants. ofOPA ~~administrative~~imposes strict, ~~civil~~joint and ~~criminal penalties,~~several ~~imposition~~liabilities ofon ~~remedial~~“responsible ~~requirements~~parties” ~~and~~for ~~the~~damages, ~~imposition~~including ofnatural ~~injunctions~~resource todamages, ~~force~~resulting ~~future~~from ~~compliance.~~oil Wespills ~~have~~into ~~made~~or upon navigable waters, ~~and~~adjoining ~~will~~shorelines ~~continue~~or toin ~~make,~~the ~~expenditures~~exclusive toeconomic ~~comply~~zone ~~with~~of ~~environmental~~the ~~requirements~~United States. ToA ~~date~~“responsible weparty” ~~have~~includes ~~not~~the ~~expended~~owner ~~material amounts~~or inoperator ~~order~~of toan ~~comply,~~onshore facility and wethe dolessee ~~not~~or ~~believe~~permit ~~that~~holder ~~our~~of ~~compliance~~the ~~with~~area ~~such~~in ~~requirements~~which ~~will~~an ~~have~~offshore afacility ~~material~~is ~~adverse~~located. ~~effect~~OPA ~~upon~~initially ~~our~~established ~~results~~a liability limit for onshore facilities of ~~operations~~$350 million, orwhich ~~competitive~~was ~~position~~subsequently orincreased ~~materially~~to ~~increase~~$633.85 ~~our~~million ~~capital~~by ~~expenditures~~a U.S. ~~Although~~Coast ~~these requirements~~Guard ~~impact~~final ~~the~~rule ~~energy~~in ~~and~~November ~~energy~~2015. ~~services~~Liability ~~industries,~~for ~~generally~~offshore ~~they~~facilities dowas ~~not~~initially ~~appear~~limited to ~~affect~~all usremoval incosts ~~any~~plus ~~material~~up ~~respect~~to ~~that~~$75 million isin ~~different,~~other ordamages; tohowever, ~~any~~BOEM ~~materially~~increased ~~greater~~this orliability ~~lesser~~limit ~~extent,~~to ~~than~~$133.65 ~~other~~million ~~companies~~ in ~~the~~December ~~energy~~2014. ~~services~~These ~~industry. However,~~liability ~~our~~limits ~~business~~may ~~and~~not ~~prospects~~apply ~~could~~if bea ~~adversely~~spill ~~affected~~is caused by ~~regulatory~~a ~~activity~~party’s ~~that~~gross ~~prohibits~~negligence or ~~restricts~~willful ~~our~~misconduct, ~~customers’~~if ~~exploration~~the ~~and~~spill ~~production~~resulted ~~activities,~~from ~~results~~violation inof ~~reduced~~a ~~demand~~federal ~~for~~safety, ~~our~~construction ~~services~~ or ~~imposes~~operating ~~environmental protection~~regulation, ~~requirements~~or ~~that~~if ~~result~~a inparty ~~increased~~fails ~~costs~~ to ~~us,~~report ~~our~~a ~~customers~~spill or ~~the~~to ~~oil~~cooperate ~~and~~fully ~~natural gas industry~~ in ~~general.~~a clean-up.

4Regulations under OPA require owners and operators of rigs in United States waters to maintain certain levels of financial responsibility. The failure to comply with OPA’s requirements may subject a responsible party to civil, criminal, or administrative enforcement actions. We are not aware of any action or event that would subject us to liability under OPA, and we believe that compliance with OPA’s financial assurance and other operating requirements will not have a material impact on our operations or financial condition.

~~Table~~ ~~of Contents~~5

Waste Handling. The ~~following~~U.S. isResource aConservation ~~summary~~and ofRecovery ~~some~~Act of(“RCRA”), ~~the~~and ~~existing~~similar state, local and foreign laws and regulations ~~which~~govern ~~apply~~the tomanagement ~~our operations~~of inwastes, including the ~~U.S.~~treatment, ~~Gulf~~storage and disposal of ~~Mexico~~hazardous wastes. RCRA imposes stringent operating requirements, and liability for failure to ~~serve~~meet assuch requirements, on a person who is either a “generator” or “transporter” of hazardous waste or an ~~example~~“owner” or “operator” of a hazardous waste treatment, storage or disposal facility. RCRA and many state counterparts specifically exclude from the ~~various~~definition ~~laws~~of hazardous waste drilling fluids, produced waters, and ~~regulations~~other towastes ~~which~~associated wewith ~~are~~the ~~subject.~~exploration, ~~While~~development, ~~laws~~or ~~vary~~production ~~widely~~of incrude ~~each~~oil ~~jurisdiction~~and natural gas. As a result, ~~each~~our operations generate minimal quantities of RCRA hazardous wastes. However, these wastes may be regulated by the ~~laws~~United States Environmental Protection Agency (“EPA”) or state agencies as solid waste. In addition, ordinary industrial wastes, such as paint wastes, waste solvents, laboratory wastes, and ~~regulations~~waste ~~below~~compressor ~~addresses~~oils ~~environmental~~may ~~issues~~be ~~similar~~regulated under RCRA as hazardous waste. We do not believe the current costs of managing our wastes, as they are presently classified, to ~~those~~ inbe ~~most~~significant. However, any repeal or modification of ~~the~~this ~~other~~or ~~jurisdictions~~similar exemption in ~~which~~similar state statutes, would increase the volume of hazardous waste we ~~operate~~are required to manage and dispose of, and would cause us, as well as our competitors, to incur increased operating expenses with respect to our U.S. operations.

~~Spills~~Water ~~and Releases~~Discharges. The ~~Comprehensive Environmental~~U.S. ~~Response~~Federal Water Pollution Control Act of 1972, ~~Compensation~~as amended, ~~and~~also ~~Liability~~known ~~Act~~as (the “~~CERCLA”)~~Clean Water Act,” and similar state laws and regulations, impose ~~joint~~restrictions and ~~several~~controls ~~liabilities,~~on ~~without regard to fault or~~ the ~~legality~~discharge of ~~the~~pollutants ~~original~~into ~~act,~~federal onand ~~certain~~state ~~classes~~waters. ofThese ~~persons that~~laws ~~contributed~~also toregulate the ~~release~~discharge of astorm ~~“hazardous~~water ~~substance”~~in ~~into~~process ~~the environment~~areas. ~~These~~Pursuant ~~persons~~to ~~include~~these ~~the~~laws ~~“owner”~~ and ~~“operator” of the site where the release occurred~~regulations, ~~past~~we ~~owners~~are ~~and~~required ~~operators~~to ofobtain ~~the site,~~ and ~~companies~~ ~~that~~maintain ~~disposed~~approvals or ~~arranged~~permits for the ~~disposal~~discharge of ~~the~~wastewater ~~hazardous~~and ~~substances~~storm ~~found~~water. atIn addition, the ~~site~~U.S. ~~Responsible~~Coast ~~parties~~Guard ~~under~~has ~~CERCLA~~promulgated ~~may~~requirements ~~be liable~~ for ~~the~~ballast ~~costs~~water ofmanagement ~~cleaning~~as upwell ~~hazardous~~as ~~substances~~supplemental ~~that~~ballast ~~have~~water ~~been~~requirements, ~~released~~which ~~into~~include ~~the~~limits ~~environment~~applicable ~~and for damages~~ to ~~natural~~specific ~~resources.~~discharge Instreams, ~~the~~such ~~course~~as ofdeck ~~our ordinary operations~~runoff, webilge ~~may~~water ~~generate~~and ~~waste~~gray ~~that~~water. ~~may~~We ~~fall~~do ~~within~~not ~~CERCLA’s~~anticipate ~~definition~~that ofcompliance awith ~~“hazardous~~these ~~substance.”~~laws ~~However,~~will wecause ~~have~~a tomaterial ~~date~~impact ~~not~~on ~~received~~our ~~any~~operations ~~notification that we are,~~ or ~~may~~ ~~be,~~financial ~~potentially responsible for cleanup costs under CERCLA~~condition.

~~Offshore~~Air ~~Regulation~~Emissions. The U.S. ~~government~~Federal ~~has~~Clean ~~indicated that~~Air ~~before~~Act ~~any~~and ~~recipient~~associated ofstate alaws ~~deepwater~~and ~~drilling~~regulations ~~permit~~restrict ~~may commence drilling, (i)~~ the ~~operator~~emission ~~must~~of ~~demonstrate~~air ~~that~~pollutants ~~containment~~from ~~resources~~many ~~are~~sources, ~~available~~including ~~promptly~~oil inand ~~the~~natural ~~event~~gas ofoperations. aNew ~~deepwater~~facilities ~~blowout,~~may ~~(ii) the~~be ~~chief~~required ~~executive officer of the operator seeking~~ to ~~perform~~obtain ~~deepwater~~permits ~~drilling~~before ~~must~~operations ~~certify~~can ~~that~~commence, ~~the operator has complied with all applicable regulations~~ and ~~(iii) the~~existing ~~Bureau~~facilities ofmay ~~Ocean~~be ~~Energy~~required ~~Management~~to ~~(“BOEM”)~~obtain ~~and~~additional ~~the~~permits, ~~Bureau of Safety~~ and ~~Environmental Enforcement~~incur ~~(“BSEE”)~~capital ~~will~~costs, ~~conduct~~in ~~inspections~~order ofto ~~such~~remain ~~deepwater~~in ~~drilling operation for~~ compliance ~~with the applicable regulations~~. WeThe ~~cannot~~EPA ~~predict~~is ~~when~~responsible ~~the~~for ~~applicable~~regulating ~~government~~air ~~agency~~emissions ~~will~~on ~~determine~~the ~~that~~Outer ~~any~~Continental ~~deepwater~~Shelf ~~driller~~apart isfrom ~~in compliance with~~ the ~~new~~Western ~~regulations.~~and ~~Third~~Central ~~party challenges to industry operations in the U.S.~~ Gulf of Mexico ~~may also serve to further delay or restrict activities. Further, in 2010~~ and ~~2011,~~ the ~~BSEE~~Arctic ~~and its predecessor agency issued initial regulations on the design and operation of well control and other equipment at offshore production sites~~Ocean, ~~implementation~~which ofare ~~safety~~regulated ~~and~~by ~~environmental~~BOEM ~~management~~under ~~systems (“SEMS”), and mandatory third-party compliance audits~~OCSLA. In ~~On August 22,~~April ~~2012~~2016, ~~BSEE~~BOEM ~~published~~proposed a ~~final~~ rule ~~amending~~that ~~the~~would ~~regulations~~impose ~~regarding~~new ~~design~~requirements ~~and~~for ~~operation~~the ofidentification, ~~well~~modeling, ~~control and other equipment~~measuring, and atracking ~~new~~of ~~SEMS~~air ~~rule~~emissions ~~was~~from ~~sent~~oil ~~to the Office of Management~~ and ~~Budget~~gas ~~for~~activities ain ~~90-day~~these ~~review on January 31, 2013~~regions. The ~~BSEE~~proposed ~~has~~rule ~~indicated~~is ~~that~~aimed ~~there~~at ~~will~~updating beBOEM’s anair ~~additional,~~quality ~~separate~~regulations ~~rulemaking~~ to ~~govern~~be ~~the~~more ~~design,~~consistent ~~performance~~with ~~and~~EPA’s ~~maintenance~~current regulation of ~~blowout~~the ~~preventers~~national ~~but~~ambient ~~that~~air ~~rule~~quality ~~has~~standards ~~not~~(“NAAQS”). ~~yet~~Federal ~~been~~and ~~published.~~state ~~BSEE~~regulatory ~~has~~agencies ~~also~~can ~~published~~impose aadministrative, ~~draft statement~~civil ofand ~~policy~~criminal onpenalties ~~safety~~for ~~culture~~non-compliance with ~~nine~~air ~~proposed~~permits ~~characteristics~~or ofother arequirements ~~robust~~of ~~safety culture. If~~ the ~~new~~Clean ~~regulations,~~Air ~~policies,~~Act ~~operating procedures~~ and ~~possibility~~associated ofstate ~~increased~~laws ~~legal~~and ~~liability~~regulations. ~~are~~In ~~viewed~~general, bywe ~~our~~believe ~~current~~that orcompliance ~~future~~with ~~customers~~the ~~as a~~Clean ~~significant~~Air ~~impairment~~Act toand ~~expected~~similar ~~profitability~~state onlaws ~~projects,~~and ~~then~~regulations ~~they~~will ~~could~~not ~~discontinue~~have ora ~~curtail~~material ~~their~~impact ~~offshore~~on ~~operations, thereby adversely affecting~~ our operations ~~by limiting drilling opportunities~~ or ~~imposing~~financial ~~materially increased costs~~condition.

~~The~~Climate ~~Oil Pollution Act~~Change. ~~The~~There ~~U.S.~~is ~~Oil~~increasing ~~Pollution~~attention ~~Act~~concerning the issue of ~~1990~~climate ~~(“OPA”)~~change and ~~similar~~the ~~regulations~~effect ~~impose certain~~of ~~operational~~greenhouse ~~requirements~~gas on(“GHG”) ~~offshore~~emissions. ~~rigs~~The ~~operating~~EPA inregulates the ~~U.S.~~permitting ~~Gulf~~ of ~~Mexico~~GHG ~~and~~emissions ~~govern~~from ~~liability~~stationary ~~for~~sources ~~leaks,~~under ~~spills~~the ~~and~~Clean ~~blowouts~~Air ~~involving~~Act’s ~~pollutants.~~Prevention ~~The~~of ~~OPA~~Significant ~~imposes~~Deterioration ~~strict, joint and several liabilities on~~ (“~~responsible parties~~PSD” ~~for~~) ~~damages,~~and ~~including~~Title ~~natural~~V ~~resource~~permitting ~~damages~~programs, ~~resulting~~which ~~from~~require ~~oil spills into or upon navigable waters, adjoining shorelines or in~~ the ~~exclusive~~use ~~economic zone~~ of ~~the~~“best ~~United~~available ~~States.~~control ~~A “responsible party~~technology” ~~includes~~for ~~the~~GHG ~~owner~~emissions orfrom ~~operator~~new ~~of an onshore facility~~ and ~~the~~modified ~~lessee~~major orstationary ~~permittee~~sources, ~~of the area in~~ which ancan ~~offshore~~sometimes ~~facility~~include ~~is located~~drillships. The ~~OPA~~EPA ~~establishes~~has aalso ~~liability~~adopted ~~limit~~rules ~~for~~requiring ~~onshore~~the ~~facilities~~monitoring ofand ~~$350 million,~~reporting ~~while~~of ~~the~~GHG ~~liability~~emissions ~~limit~~from ~~for~~specified ~~offshore~~sources ~~facilities~~in isthe ~~equal~~United ~~to all~~States, ~~removal~~including, ~~costs~~among ~~plus~~other upthings, tocertain ~~$75 million~~onshore inand ~~other~~offshore ~~damages.~~oil ~~These~~and ~~liability~~natural ~~limits~~gas ~~may~~production ~~not~~facilities, ~~apply~~on ifan aannual ~~spill~~basis. isFacilities ~~caused~~containing bypetroleum aand ~~party’s~~natural ~~gross~~gas ~~negligence~~systems orthat ~~willful~~emit ~~misconduct~~25,000 ifmetric ~~the~~tons ~~spill~~or ~~resulted~~more ~~from violation~~ of aCO2 ~~federal~~equivalent ~~safety, construction~~per oryear ~~operating~~are ~~regulation,~~now orrequired ~~if a party fails~~ to report aannual ~~spill~~GHG oremissions to ~~cooperate~~the ~~fully in a clean-up~~EPA.

~~Regulations under~~Further, ~~the~~proposed ~~OPA~~legislation ~~require~~has ~~owners~~been ~~and~~introduced ~~operators~~in Congress that would establish an economy-wide cap on emissions of ~~rigs~~GHG’s in the United States ~~waters~~and towould ~~maintain~~require ~~certain~~most ~~levels~~sources of ~~financial~~GHG ~~responsibility.~~emissions ~~The~~to ~~failure~~obtain GHG emission “allowances” corresponding to ~~comply~~their ~~with~~annual ~~the~~emissions ~~OPA~~of GHG’s. ~~requirements~~Moreover, ~~may~~in ~~subject~~2005, the Kyoto Protocol to the 1992 United Nations Framework Convention on Climate Change, which establishes a ~~responsible~~binding ~~party~~set of emission targets for GHGs, became binding on all countries that had ratified it. In 2015, the United Nations Climate Change Conference in Paris resulted in the creation of the Paris Agreement. The Paris Agreement was signed on April 22, 2016 and requires countries to ~~civil~~review and “represent a progression” in their nationally determined contributions, ~~criminal~~which set emissions reduction goals, ~~or administrative~~every ~~enforcement~~five ~~actions~~years beginning in 2020. WeWhile ~~are~~it is not ~~aware~~possible ofat ~~any~~this ~~action~~time orto ~~event~~predict how new treaties and legislation that ~~would~~may ~~subject~~be usenacted to ~~liability~~address ~~under~~GHG ~~the~~emissions ~~OPA~~would impact our business, ~~and~~the wemodification ~~believe~~of ~~that~~existing ~~compliance~~laws ~~with~~or regulations or the ~~OPA’s~~adoption ~~financial~~of ~~assurance~~new laws or regulations curtailing exploratory or developmental drilling for oil and ~~other~~gas ~~operating~~could ~~requirements~~materially ~~will~~and ~~not~~adversely affect our operations by limiting drilling opportunities or imposing materially increased costs. Moreover, incentives to conserve energy or use alternative energy sources could have a ~~material~~ negative impact on our ~~operations~~business orif ~~financial~~such ~~condition.~~incentives reduce the worldwide demand for oil and gas.

5Countries in the European Union ("EU") implement the U.N.’s Kyoto Protocol on GHG emissions through the Emissions Trading System (“ETS”), though ETS will continue to require GHG reductions in the future that are not currently prescribed by the Kyoto Protocol or related agreements. The ETS program establishes a GHG “cap and trade” system for certain industry sectors, including power generation at some offshore facilities. Total GHG from these sectors is capped, and the cap is reduced over time to achieve a 21 percent GHG reduction from these sectors between 2005 and 2020. In July 2015, the European Commission presented a legislative proposal to revise the European Union ETS for the period after 2020 that includes a more rapid reduction

~~Table~~ ~~of Contents~~6

~~Waste~~in ~~Handling. The~~emission ~~U.S. Resource Conservation and Recovery Act (“RCRA”)~~allowances, ~~and~~among ~~similar~~other ~~state~~suggestions. ~~and~~This ~~local~~revision ~~laws~~would ~~and~~also ~~regulations~~increase ~~govern~~ the ~~management~~21 ofpercent ~~wastes,~~GHG ~~including~~reduction ~~the~~target ~~treatment,~~for ~~storage~~ETS ~~and~~sectors ~~disposal~~discussed ofabove ~~hazardous wastes. RCRA imposes stringent operating requirements, and liability for failure~~ to ~~meet such~~43 ~~requirements,~~percent onby ~~a person who is either a “generator” or “transporter” of hazardous waste or an “owner” or “operator” of a hazardous waste treatment, storage or disposal facility~~2030. ~~RCRA~~The ~~specifically excludes~~European ~~from~~Parliament ~~the definition of hazardous waste drilling fluids, produced waters,~~ and ~~other~~Council ~~wastes~~have ~~associated~~yet ~~with~~to ~~the~~adopt ~~exploration,~~legislation ~~development,~~relating orto ~~production~~this ~~of crude oil and natural gas~~proposal. AMore ~~similar~~generally, ~~exemption is contained in many of~~ the ~~state counterparts~~EU toCommission ~~RCRA.~~has Asproposed a ~~result,~~roadmap wefor ~~are~~reducing ~~not~~emissions ~~required~~by to80 ~~comply~~percent ~~with a substantial portion of RCRA’s requirements as our operations generate minimal quantities of hazardous wastes. However, these wastes may be regulated~~ by ~~the~~2050 ~~United~~compared ~~States Environmental~~to ~~Protection~~1990 ~~Agency (“EPA”) or state agencies as solid waste~~levels. InSome ~~addition,~~EU ~~ordinary~~member ~~industrial~~states ~~wastes,~~have ~~such~~enacted asadditional ~~paint wastes, waste solvents, laboratory wastes,~~ and ~~waste~~more ~~compressor~~long-term ~~oils~~legally ~~may~~binding ~~be regulated under RCRA as hazardous waste~~targets. WeFor doexample, ~~not believe~~ the ~~current~~UK ~~costs~~has ofcommitted ~~managing our wastes, as they are presently classified,~~ to bereduce ~~significant.~~GHG ~~However,~~emissions aby ~~petition~~80 ispercent ~~currently~~by ~~before the EPA to revoke the oil and natural gas exploration and production exemption~~2050. ~~Any repeal~~These orreduction ~~modification~~targets ofmay ~~this~~also orbe ~~similar~~affected ~~exemption~~by infuture ~~similar~~negotiations ~~state~~under ~~statutes, would increase~~ the ~~volume~~United ofNations ~~hazardous~~Framework ~~waste~~Convention weon ~~are~~Climate ~~required~~Change ~~to manage~~ and ~~dispose~~its ~~of,~~Kyoto Protocol and ~~would~~Paris ~~cause us, as well as our competitors, to incur increased operating expenses with respect to our U~~Agreement.~~S. operations.~~

~~Water~~Entities ~~Discharges. The~~operating ~~U.S.~~over ~~Federal~~the ~~Water~~cap ~~Pollution~~must ~~Control~~either ~~Act~~reduce ~~of 1972~~their GHG emissions or purchase tradable emissions allowances, asor ~~amended~~EUAs, ~~also~~from ~~known~~other asprogram participants, or purchase international GHG offset credits generated under the “Kyoto Protocol’s Clean ~~Water~~Development ~~Act,”~~Mechanisms ~~and~~or ~~similar~~Joint ~~state~~Implementation ~~laws~~for ~~and~~international ~~regulations~~carbon ~~impose~~trading ~~restrictions~~after ~~and~~2020. ~~controls~~However, onthe Paris Agreement provides for the ~~discharge~~creation of ~~pollutants~~a ~~into~~new ~~federal~~market-based mechanism that could replace the Clean Development Mechanisms and ~~state~~Joint ~~waters~~Implementation. ~~These~~As ~~laws~~the ~~also~~cap ~~regulate~~declines, ~~the~~prices ~~discharge~~for ofemissions ~~storm water~~allowances inor ~~process~~GHG ~~areas~~offset credits may rise. ~~Pursuant~~However, due to ~~these~~the ~~laws~~over-allocation of EUAs by EU member states in earlier phases and ~~regulations~~the impact of the recession in the EU, wethere ~~are~~has ~~required~~been a general over-supply of EUAs. The EU has recently approved amending legislation to ~~obtain~~withhold ~~and~~the ~~maintain~~auction ~~approvals~~of orEUAs ~~permits~~in a process known as “back-loading.” EU proposals for wider structural reform of the ~~discharge~~EU ETS may follow the enactment of ~~wastewater~~the back-loading legislation. For example, in July and ~~storm~~October ~~water.~~2015, Wethe doEuropean ~~not~~Parliament ~~anticipate~~and ~~that~~Council, ~~compliance~~respectively, ~~with~~approved ~~these~~a ~~laws~~Market Stability Reserve. The Market Stability Reserve will ~~cause~~start aoperating ~~material impact~~in onJanuary ~~our~~2019 ~~operations~~and oris ~~financial~~intended ~~condition~~as a long-term solution to the oversupply. Both back-loading and wider structural reforms are aimed at reviving the EU carbon price.

~~Air~~In ~~Emissions. The~~addition, ~~U.S.~~the ~~Federal~~UK ~~Clean~~government, ~~Air~~which ~~Act~~implements ~~and~~ETS ~~associated state~~in ~~laws and regulations restrict~~ the ~~emission~~UK ofNorth ~~air pollutants from many sources~~Sea, ~~including~~has ~~oil~~introduced ~~and~~a ~~natural~~carbon ~~gas~~price ~~operations.~~floor ~~New~~mechanism ~~facilities may be required~~ to ~~obtain~~place ~~permits~~an ~~before~~incrementally ~~operations~~increasing ~~can~~minimum ~~commence,~~price ~~and~~on ~~existing facilities may be required to obtain additional permits, and incur capital costs, in order to remain in compliance~~carbon. ~~Federal and state regulatory agencies can impose administrative~~Thus, ~~civil~~the ~~and~~cost ~~criminal~~of ~~penalties for non-~~compliance with ~~air~~ETS ~~permits~~can orbe ~~other~~expected ~~requirements~~to ofincrease ~~the Clean~~over ~~Air Act and associated state laws and regulations~~time. InAdditional ~~general,~~member ~~we believe that compliance with the Clean Air Act and similar~~ state ~~laws~~climate ~~and~~change ~~regulations~~legislation ~~will~~may ~~not~~result ~~have~~in apotentially material ~~impact~~capital ~~on our operations or financial condition~~expenditures.

~~Climate~~We ~~Change.~~have ~~There is increasing attention concerning the issue of climate change and the effect of greenhouse gas (“GHG”) emissions. In December 2009, the EPA~~ determined that ~~current~~combustion ~~and projected concentrations~~ of ~~six~~diesel ~~key~~fuel ~~GHG’s~~(Scope in1) ~~the~~aboard ~~atmosphere~~all ~~threaten public health and welfare. The EPA subsequently finalized GHG standards for motor vehicles, the effect~~ of ~~which~~our ~~could~~vessels ~~reduce~~worldwide ~~demand~~is ~~for motor fuels refined from crude oil, and a final rule to address permitting of GHG emissions from stationary sources under~~ the ~~Clean Air Act~~Company’s ~~Prevention~~primary ofsource ~~Significant Deterioration (“PSD”) and Title V permitting programs, which require the use~~ of ~~“best available control technology” for~~ GHG emissions, ~~from~~including ~~new~~carbon ~~and modified major stationary sources~~dioxide, ~~which~~methane ~~can~~and ~~sometimes~~nitrous ~~include drillships~~oxide. ~~EPA~~The ~~regulations~~data ~~known~~necessary ~~as the “Tailoring Rule” also require the PSD program~~ to ~~address~~report ~~GHG~~indirect emissions from ~~relatively~~generation ~~smaller~~of ~~stationary~~purchased ~~sources~~power in(Scope ~~the~~2) ~~future. The EPA~~ has ~~also~~not ~~adopted~~been ~~rules~~previously ~~requiring~~collected. ~~the~~We ~~monitoring~~will ~~and~~establish ~~reporting of GHG emissions from specified sources in~~ the ~~United~~necessary ~~States,~~procedures ~~including,~~to ~~among~~collect ~~other things, certain onshore~~ and offshore oil and natural gas production facilities, on an annual basis. Facilities containing petroleum and natural gas systems that emit 25,000 metric tons or more of CO2 equivalent per year are now required to report ~~annual~~Scope ~~GHG~~2 ~~emissions to the EPA~~data.

~~Further,~~For ~~proposed legislation has been introduced in Congress that would establish an economy-wide cap on emissions of GHG’s in~~ the ~~United~~year ~~States~~ended ~~and~~December 31, ~~would~~2016, ~~require~~our ~~most~~estimated ~~sources~~carbon ofdioxide ~~GHG~~equivalent ~~emissions to obtain GHG emission~~ (“~~allowances~~CO2e”) ~~corresponding~~gas ~~to their annual~~ emissions ~~of GHG’s.~~were ~~Moreover~~483,111 intonnes ~~2005,~~as ~~the~~compared ~~Kyoto Protocol~~ to ~~the 1992 United Nations Framework Convention on Climate Change~~625,829 ~~which~~tonnes ~~establishes a binding set of emission targets~~ for ~~greenhouse gases, became binding on all countries that had ratified it. Recent international discussions following~~ the ~~United~~year ~~Nations~~ended ~~Climate Change Conference in Doha~~December 31, ~~Qatar in December 2012 are exploring options to replace the Kyoto Protocol~~2015. ~~While~~The itdecline isin ~~not~~emissions ~~possible~~was atmostly ~~this~~due ~~time~~ to ~~predict~~a ~~how~~decrease ~~new~~in ~~treaties~~drillship ~~and legislation~~engine ~~that~~use. ~~may~~When beexpressed ~~enacted~~as toan ~~address~~intensity ~~GHG~~measure ~~emissions would impact our business, the modification~~ of ~~existing~~tonnes ~~laws or regulations or the adoption~~ of ~~new~~CO2e ~~laws or regulations curtailing exploratory or developmental drilling for oil and~~ gas ~~could materially~~emissions ~~and~~per ~~adversely~~dollar ~~affect~~of ~~our~~contract ~~operations by limiting~~ drilling ~~opportunities~~revenues orfrom ~~imposing~~continuing ~~materially increased costs. Moreover~~operations, ~~incentives~~both ~~to conserve energy or use alternative energy sources could have a negative impact on our business if such incentives reduce~~ the ~~worldwide~~2016 ~~demand~~and ~~for~~2015 ~~oil~~intensity ~~and~~measure ~~gas.~~was .0002.

6Our Scope 1 CO2e gas emissions reporting has been prepared with reference to the requirements set out in the UK Companies Act 2006 Regulations 2013, the Environmental Reporting Guidelines (June 2013) issued by the Department for Environment Food & Rural Affairs, the World Resources Institute and World Business Council for Sustainable Development GHG Protocol Corporate Accounting and Reporting Standard Revised and the International Organization for Standardization (“ISO”) 14064-1, “Specification with guidance at the organizational level for quantification and reporting of greenhouse gas emissions and removals (2006).” We have used SANGEA™ Emissions Estimation Software to estimate CO2e gas of Scope 1 emissions based on diesel fuel consumption.

~~Table~~It ofis ~~Contents~~our intent to have the procedures related to GHG emissions independently assessed in the future.

Worker Safety. The U.S. Occupational Safety and Health Act (“OSHA”) and other similar laws and regulations govern the protection of the health and safety of employees. The OSHA hazard communication standard, EPA community right-to-know regulations under Title III of CERCLA and similar state statutes require that information be maintained about hazardous materials used or produced in our operations and that this information be provided to employees, state and local governments and citizens. We believe that we are in substantial compliance with these requirements and with other applicable OSHA requirements.

~~Insurance~~On June 10, 2013, the European Union adopted a new directive, Directive 2013/30/EU, on the safety of offshore oil and ~~Indemnification~~gas ~~Matters~~operations within the exclusive economic zone (which can extend up to 200 nautical miles from a coast) or the continental shelf of any of its member states. The directive establishes minimum requirements for preventing major accidents in offshore oil and gas operations, and aims to limit the consequences of such accidents. All European Union member states were required to adopt national legislation or regulations by July 19, 2015 to implement the new directive’s requirements, which also include reporting requirements related to major safety and environmental hazards that must be satisfied before drilling can take place, as well as the use of “all suitable measures” to both prevent major accidents and limit the human health and environmental consequences of such a major accident should one occur. We believe that our operations are in substantial compliance with the requirements of the directive (as well as the extensive current health and safety regimes implemented in the member states in which we operate), but future developments could require the Company to incur significant costs to comply with its implementation.

~~Our~~International ~~operations~~Regulatory ~~are~~Regime. The ~~subject~~International toMaritime ~~many~~Organization ~~hazards~~(“IMO”) ~~inherent~~provides ininternational ~~the~~regulations ~~drilling~~governing ~~business,~~shipping ~~including blowouts, fires~~ and ~~collisions~~international ormaritime ~~groundings~~trade. ~~of offshore~~IMO ~~equipment,~~regulations ~~and~~have ~~damage~~been orwidely ~~loss~~adopted ~~from~~by ~~adverse weather and sea conditions~~U.N. ~~These~~member ~~hazards could cause personal injury or loss of life~~countries, ~~loss~~and ofin ~~revenues,~~some ~~pollution~~jurisdictions ~~and~~in ~~other~~which ~~environmental~~we ~~damage~~operate, ~~damage~~these toregulations orhave ~~destruction~~been ofexpanded ~~property~~upon. ~~and~~The ~~equipment and~~requirements ~~oil~~contained ~~and natural gas producing formations, and could result~~ in ~~claims~~the ~~by employees, customers or third parties.~~

~~Our drilling~~ contracts provide for varying levels of indemnification from our customers and in most cases also require us to indemnify our customers for certain losses. Under our drilling contracts, liability with respect to personnel and property is typically assigned on a “knock-for-knock” basis, which means that we and our customers assume liability for our respective personnel and property, irrespective of the fault or negligence of the party indemnified. In addition, our customers may indemnify us in certain instances for damage to our down-hole equipment and, in some cases, our subsea equipment. 7

~~Our customers~~International ~~typically~~Management ~~assume~~Code ~~responsibility~~ for ~~and~~the ~~indemnify~~Safe usOperation ~~from~~of ~~loss~~Ships orand ~~liability~~for ~~resulting~~Pollution ~~from~~Prevention, ~~pollution~~ or ~~contamination~~ISM Code, ~~including~~promulgated ~~third-party~~by ~~damages~~the ~~and~~IMO, ~~clean-up~~govern ~~and~~much ~~removal,~~of ~~arising~~our ~~from~~drilling operations. ~~under~~Among ~~the~~other ~~contract~~requirements, ~~and originating below~~ the ~~surface~~ISM ofCode requires the ~~water.~~party Wewith ~~are~~operational ~~generally~~control ~~responsible~~of ~~for~~a ~~pollution~~vessel ~~originating~~to ~~above~~develop ~~the~~an ~~surface~~extensive ofsafety ~~the~~management ~~water~~system ~~and~~that ~~emanating~~includes, ~~from~~among ~~our~~other ~~drilling units. Additionally~~things, ~~our~~the ~~customers~~adoption ~~typically~~of ~~indemnify~~a ussafety ~~for~~and ~~liabilities~~environmental ~~incurred~~protection aspolicy asetting ~~result~~forth ofinstructions ~~a blow-out~~and orprocedures ~~cratering~~for ofoperating ~~the~~its ~~well~~vessels safely and ~~underground~~describing ~~reservoir~~procedures ~~loss~~for orresponding ~~damage.~~to emergencies.

InThe ~~addition~~IMO has also adopted MARPOL, including Annex VI to ~~the~~MARPOL ~~contractual~~which ~~indemnities described~~sets ~~above,~~limits weon ~~also~~sulfur ~~carry~~dioxide ~~protection~~and nitrogen oxide emissions from ship exhausts and ~~indemnity~~prohibits ~~(“P&I”)~~deliberate ~~insurance~~emissions of ozone depleting substances. Annex VI, which isapplies ato ~~comprehensive~~all ~~general~~ships, ~~liability~~fixed ~~insurance~~and ~~program~~floating ~~covering~~drilling ~~liability~~rigs ~~resulting~~and ~~from~~other ~~offshore~~floating ~~operations.~~platforms, ~~Our~~imposes ~~P&I~~a ~~insurance~~global ~~includes~~cap ~~coverage~~on the sulfur content of fuel oil and allows for ~~liability~~ ~~resulting~~specialized ~~from~~areas ~~personal~~to ~~injury~~be orestablished ~~death~~internationally ofwith ~~third~~even ~~parties~~more stringent controls on sulfur emissions. For vessels 400 gross tons and ~~our~~greater, ~~offshore~~platforms ~~employees~~and drilling rigs, ~~third~~Annex ~~party~~VI ~~property~~imposes ~~damage~~various survey and certification requirements. On July 15, ~~pollution~~2011, ~~spill~~the ~~clean-up~~IMO approved mandatory measures to reduce emissions of GHGs from international shipping, requiring energy efficiency and ~~containment~~survey and ~~removal~~certification measures. These amendments to Annex VI apply to all ships of ~~wrecks~~400 gross tonnage and above and entered into force on January 1, 2013, affecting the operations of vessels that are registered in countries that are signatories to MARPOL Annex VI or ~~debris~~vessels that call upon ports located within such countries. ~~Our~~Moreover, ~~insurance~~2008 ~~policy~~amendments ~~does~~to ~~not~~Annex ~~exclude~~VI ~~losses resulting~~require the imposition of progressively stricter limitations on sulfur emissions from ~~our~~ships. ~~gross~~These ~~negligence~~amendments orrequired ~~willful~~that, ~~misconduct~~as of January 1, 2015, the sulfur content of marine fuel in SOx Emission Control Areas (“ECAs”) be limited to 0.10 ~~Our~~percent ~~P&I~~m/m ~~insurance~~(mass ~~program~~by ismass). ~~renewed~~The North American ECA became effective in ~~March~~August 2012. The North Sea and Baltic Sea ECAs have been in place since July 1, 2010. The North Sea ECA encompasses all of ~~each~~the ~~year~~North Sea and ~~currently~~the ~~has~~full length of the English Channel. These regulations also established a ~~standard~~global ~~deductible~~cap on the marine fuel sulfur content of ~~$10~~3.50 percent m/m in non-ECA areas that will decrease progressively to a 0.5 percent m/m cap by January ~~million~~1, ~~per~~2020. ~~occurrence~~The amendments also establish new tiers of stringent nitrogen oxide emissions standards for new marine engines, ~~with~~depending ~~maximum~~on ~~liability~~their ~~coverage~~date of ~~$750 million.~~ installation.

~~Our~~The ~~insurance~~IMO ~~policies~~has negotiated international conventions that impose liability for oil pollution in international waters and ~~contractual~~the ~~rights~~territorial waters of the signatory to ~~indemnity~~such ~~may~~conventions ~~not~~such ~~adequately~~as ~~cover~~the ~~our~~Ballast ~~losses~~Water ~~and liabilities~~Management Convention, or BWM Convention. The BWM Convention’s implementing regulations call for a phased introduction of mandatory ballast water exchange requirements (beginning in ~~all~~2009), ~~cases~~to be replaced in time with a requirement for mandatory ballast water treatment. ~~For~~The ~~additional~~BWM ~~information~~Convention will enter into force on September 8, ~~please~~2017, ~~read~~after ~~“We~~having ~~may~~reached ~~have~~its ~~difficulty~~35 ~~obtaining~~percent orratification ~~maintaining~~trigger ~~insurance~~in September 2016. Upon the BWM Convention’s entry into force, all vessels in international traffic are to comply with the ~~future~~ballast ~~and~~water ~~our~~exchange ~~insurance~~standard. Thereafter, ~~coverage~~vessels ~~and~~will ~~contractual~~be ~~indemnity~~required ~~rights~~to ~~may~~meet ~~not~~the ~~protect~~more usstringent ~~against~~ballast ~~all~~water ofperformance standard no later than the ~~risks and~~first ~~hazards~~intermediate weor ~~face”~~renewal ~~included~~survey infollowing ~~Item 1A~~the Convention’s entry into force. All of ~~this~~our ~~Annual~~drilling ~~Report~~rigs onare ~~Form~~in ~~10-K.~~substantial compliance with the proposed terms of the BWM Convention.

The ~~above~~IMO ~~description~~has also adopted the International Convention for Civil Liability for Bunker Oil Pollution Damage of ~~our~~2001, ~~insurance program~~or Bunker Convention. The Bunker Convention provides a liability, compensation and compulsory insurance system for the ~~indemnification~~victims ~~provisions~~of oil pollution damage caused by spills of ~~our~~bunker ~~drilling~~oil. ~~contracts~~Under isthe ~~only~~Bunker aConvention, ~~summary~~ship asowners ofmust pay compensation for pollution damage (including the ~~time~~cost of ~~preparation~~preventive measures) caused in the territory, including the territorial sea of ~~this~~a ~~report~~State Party, ~~and~~as iswell ~~general~~as inits ~~nature~~exclusive economic zone or equivalent area. ~~Our~~Registered ~~insurance~~owners ~~program~~of any seagoing vessel and ~~the~~seaborne ~~terms~~craft over 1,000 gross tons, of ~~our~~any ~~drilling~~type ~~contracts~~whatsoever, ~~may~~and ~~change~~registered in ~~the~~a ~~future.~~State ~~In addition~~Party, ~~the~~or ~~indemnification~~entering ~~provisions~~or ofleaving ~~our~~a ~~drilling~~port ~~contracts~~in ~~may~~the beterritory ~~subject~~of toa ~~differing~~State ~~interpretations~~Party, ~~and~~must ~~enforcement~~maintain insurance which meets the requirements of ~~those~~the ~~provisions~~Bunker ~~may~~Convention beand ~~limited~~to obtain a certificate issued by ~~public~~a ~~policy~~State ~~and~~Party ~~other~~attesting ~~considerations~~that such insurance is in force. The State issued certificate must be carried on board at all times. We believe that all of our drilling rigs are currently compliant in all material respects with these regulations.

~~Employees~~The IMO continues to review and introduce new regulations. It is impossible to predict what additional regulations, if any, may be passed by the IMO and what effect, if any, such regulation may have on our operations.

~~At December 31,~~Insurance 2012, we had approximately 5,600 employees, excluding approximately 2,000 persons engaged through labor contractors or agencies. Approximately 75 percent of our employees were engaged in operations outside of the U.S. We are not a party to any material collective bargaining agreements, and weIndemnification ~~consider our employee relations to be satisfactory.~~ Matters

7Our operations are subject to many hazards inherent in the drilling business, including blowouts, fires, collisions, groundings, punch-throughs, and damage or loss from adverse weather and sea conditions. These hazards could cause personal injury or loss of life, loss of revenues, pollution and other environmental damage, damage to or destruction of property and equipment and oil and natural gas producing formations, and could result in claims by employees, customers or third parties and fines and penalties.

~~Table~~Our drilling contracts provide for varying levels of ~~Contents~~indemnification from our customers and in most cases also require us to indemnify our customers for certain losses. Under our drilling contracts, liability with respect to personnel and property is typically assigned on a “knock-for-knock” basis, which means that we and our customers assume liability for our respective personnel and property, generally irrespective of the fault or negligence of the party indemnified. In addition, our customers may indemnify us in certain instances for damage to our down-hole equipment and, in some cases, our subsea equipment. Also, we generally obtain a mutual waiver of consequential losses in our drilling contracts.

~~Financial~~Our ~~Information~~customers ~~About~~typically ~~Segments~~assume responsibility for and ~~Geographic~~indemnify ~~Areas~~us from loss or liability resulting from pollution or contamination, including third-party damages and clean-up and removal, arising from operations under the contract and originating

~~Information~~ ~~regarding our revenues from external customers, segment profit or loss and total assets attributable to each segment for the last three fiscal years is presented in “Part II Item~~ 8~~. Financial Statements and Supplementary Data, Note 17 — Segment and Related Information.”~~

~~Information~~below ~~regarding~~the ~~our~~surface ~~operating~~of ~~revenues~~the ~~and~~water. ~~identifiable~~We ~~assets~~are ~~attributable~~generally toresponsible ~~each~~for ofpollution ~~our~~originating ~~geographic~~above ~~areas~~the surface of ~~operations~~the ~~for~~water ~~the~~and ~~last~~emanating ~~three~~from ~~fiscal~~our ~~years~~drilling isunits. ~~presented~~Additionally, inour ~~“Part~~customers IItypically ~~Item 8. Financial~~indemnify ~~Statements~~us ~~and~~for ~~Supplementary~~liabilities ~~Data,~~incurred ~~Note~~as 17a —result ~~Segment~~of a blow-out or cratering of the well and ~~Related~~underground ~~Information.”~~reservoir loss or damage.

~~Available~~In ~~Information~~addition to the contractual indemnities described above, we also carry Protection and Indemnity (“P&I”) insurance, which is a comprehensive general liability insurance program covering liability resulting from offshore operations. Our P&I insurance includes coverage for liability resulting from personal injury or death of third parties and our offshore employees, third-party property damage, pollution, spill clean-up and containment and removal of wrecks or debris. Our P&I insurance program is renewed in April of each year and currently has a standard deductible of $10 million per occurrence, with maximum liability coverage of $750 million. We also carry hull and machinery insurance that protects us again physical loss or damage to our drilling rigs, subject to a deductible.

Our ~~Annual~~insurance ~~Report~~policies onand ~~Form~~contractual ~~10-K,~~rights ~~Quarterly~~to ~~Reports~~indemnity onmay ~~Form~~not ~~10-Q,~~adequately ~~Current~~cover ~~Reports~~our onlosses ~~Form 8-K~~ and ~~amendments~~liabilities toin ~~those~~all ~~reports filed or furnished pursuant to Section 13(a) or 15(d) of the U~~cases.S. ~~Securities~~For ~~Exchange~~additional ~~Act~~information, ofplease ~~1934~~read ~~are~~“We ~~available~~may ~~free~~have ofdifficulty ~~charge~~obtaining ator ~~our~~maintaining ~~website~~insurance atin ~~http://www.noblecorp.com. These filings are also available to~~ the ~~public~~future atand ~~the~~our ~~U.S.~~insurance ~~Securities~~coverage and ~~Exchange Commission’s~~contractual ~~(“SEC”)~~indemnity ~~Public~~rights ~~Reference Room at 100 F Street, NE, Room 1580, Washington, DC 20549. The public~~ may ~~obtain~~not ~~information~~protect onus ~~the~~against ~~operation~~all of the ~~Public~~risks ~~Reference~~and ~~Room~~hazards bywe ~~calling~~face” ~~the~~included ~~SEC~~in atPart ~~1-800-SEC-0330.~~I, ~~Electronic~~Item 1A, ~~filings with~~“Risk ~~the~~Factors” ~~SEC~~of ~~are~~this ~~also~~Annual ~~available~~Report on ~~the~~Form ~~SEC’s website at http://www~~10-K.~~sec.gov.~~

~~You~~The ~~may~~above ~~also~~description ~~find~~of ~~information~~our ~~related~~insurance toprogram and the indemnification provisions of our ~~corporate~~ ~~governance,~~drilling ~~board~~contracts ~~committees~~is ~~and~~only ~~company~~a ~~code~~summary as of ~~ethics~~the (time of preparation of this report, and ~~any~~is ~~amendments~~general orin ~~waivers~~nature. ofOur ~~compliance)~~insurance atprogram and the terms of our ~~website~~drilling contracts may change in the future. ~~Among~~In addition, the ~~documents~~indemnification ~~you~~provisions ~~can~~of ~~find~~our ~~there~~drilling ~~are~~contracts ~~the~~may ~~following:~~be subject to differing interpretations, and enforcement of those provisions may be limited by public policy and other considerations.

~~• Corporate Governance Guidelines;~~Employees

•At ~~Audit~~December 31, ~~Committee~~2016, ~~Charter;~~we had approximately 2,100 employees, excluding approximately 700 persons we engaged through labor contractors or agencies. Approximately 84 percent of our workforce is located offshore. Of our shorebased employees, approximately 70 percent are male. We are not a party to any material collective bargaining agreements, and we consider our employee relations to be satisfactory.

•We ~~Nominating~~place considerable value on the involvement of our employees and ~~Corporate~~maintain ~~Governance~~a ~~Committee~~practice ~~Charter;~~of keeping them informed on matters affecting them, as well as on the performance of the Company. Accordingly, we conduct formal and informal meetings with employees, maintain a Company intranet website with matters of interest, issue periodic publications of Company activities and other matters of interest, and offer a variety of in-house training.

•We ~~Health,~~are ~~Safety,~~committed ~~Environment~~to a policy of recruitment and ~~Engineering~~promotion ~~Committee~~on ~~Charter;~~the basis of aptitude and ability without discrimination of any kind. Management actively pursues both the employment of disabled persons whenever a suitable vacancy arises and the continued employment and retraining of employees who become disabled while employed by the Company. Training and development is undertaken for all employees, including disabled persons.

•Financial ~~Compensation~~Information ~~Committee~~about ~~Charter;~~Segments and Geographic Areas

•Information ~~Code~~regarding ofour ~~Business~~revenues ~~Conduct~~from external customers, segment profit or loss and ~~Ethics~~total assets attributable to each segment for the last three fiscal years is presented in Part II, Item 8, “Financial Statements and Supplementary Data, Note 18 — Segment and Related Information.”

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 Part II, Item 8, ~~1A.~~“Financial ~~Risk~~Statements ~~Factors~~and Supplementary Data, Note 18 — Segment and Related Information.”

~~You~~Available should carefully consider the following risk factors in addition to the other information included in this Annual Report on Form 10-K. Each of these risk factors could affect our business, operating results and financial condition, as well as affect an investment in our shares. Information

~~Risk~~Our ~~Factors~~Annual ~~Relating~~Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to ~~Our~~those ~~Business~~reports filed or furnished pursuant to Section 13(a) or 15(d) of the U.S. Securities Exchange Act of 1934 are available free of charge at our website at http://www.noblecorp.com. These filings are also available to the public at the U.S. Securities and Exchange Commission’s (the “SEC”) Public Reference Room at 100 F Street, NE, Room 1580, 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’s website at http://www.sec.gov.

~~Our~~You ~~business~~may ~~depends~~also onfind ~~the~~information ~~level~~related ofto ~~activity~~our incorporate ~~the~~governance, ~~oil~~board committees and ~~gas~~company ~~industry,~~code ~~which~~of isethics ~~significantly~~(and ~~affected~~any byamendments ~~volatile~~or ~~oil~~waivers ~~and~~of ~~gas prices~~compliance) at our website. Among the documents you can find there are the following:

~~Demand~~• ~~for~~Articles ~~drilling services depends on a variety~~ of economic and political factors and the level of activity in offshore oil and gas exploration and development and production markets worldwide. Commodity prices, and market expectations of potential changes in these prices, may significantly affect this level of activity. However, higher prices do not necessarily translate into increased drilling activity since our clients’ expectations of future commodity prices typically drive demand for our rigs. Oil and gas prices are extremely volatile and are affected by numerous factors beyond our control, including: Association;

• ~~laws~~Code ~~and~~of ~~regulations~~Business ~~related~~Conduct ~~to environmental or energy security matters, including those addressing alternative energy sources~~ and ~~the risks of global climate change~~Ethics;

• ~~the~~Corporate ~~political~~Governance ~~environment of oil-producing regions, including uncertainty or instability resulting from civil disorder, an outbreak or escalation of armed hostilities or acts of war or terrorism~~Guidelines;

• ~~worldwide demand for oil and gas, which is impacted by changes in the rate of economic growth in the global economy;~~9

• ~~the~~Audit ~~ability~~Committee ~~of OPEC to set and maintain production levels and pricing~~Charter;

• ~~the~~Compensation ~~level~~Committee ~~of production in non-OPEC countries~~Charter;

8• Health, Safety, Environment and Engineering Committee Charter;

~~Table~~• ofNominating ~~Contents~~and Corporate Governance Committee Charter; and

• ~~the~~Finance ~~laws~~Committee ~~and regulations of governments regarding exploration and development of their oil and gas reserves or speculation regarding future laws or regulations;~~Charter.

•Item ~~the~~1A. ~~cost~~Risk ~~of exploring for, developing, producing and delivering oil and gas;~~Factors.

•You should carefully consider the ~~discovery~~following ~~rate~~risk factors in addition to the other information included in this Annual Report on Form 10-K. Each of ~~new~~these ~~oil~~risk factors could affect our business, operating results and ~~gas~~financial ~~reserves;~~condition, as well as affect an investment in our shares.

•Risk ~~the~~Factors ~~rate~~Relating ofto ~~decline~~Our ~~of existing and new oil and gas reserves;~~Business

•Our ~~available~~business ~~pipeline~~and results of operations have been materially hurt and ~~other~~our enterprise value has substantially declined due to current depressed market conditions which are the result of the dramatic drop in the oil price and ~~gas~~the ~~transportation~~oversupply ~~capacity;~~of offshore drilling rigs.

•Brent crude has declined from approximately $112 per barrel on June 30, 2014 to as low as approximately $30 per barrel in January 2016, before improving to $56 per barrel on February 15, 2017. In addition, a large number of offshore drilling rigs were constructed and added to the ~~ability~~global fleet in the last few years, and a substantial number of additional rigs, including rigs built on speculation, are currently scheduled to enter the market in 2017. Also, many in our industry extended the lives of older rigs rather than retiring these rigs. These factors have led to a significant oversupply of drilling rigs at the same time that our customers have greatly reduced their planned exploration and development spending in response to the depressed price of oil. These factors have affected market conditions and led to a material decline in the demand for our services, the dayrates we are paid by our customers and the level of utilization of our drilling rigs. These poor market conditions, in turn, have led to a material deterioration in our results of operations. We have already experienced a substantial decline in the price of our shares, which has declined from $27.00 on August 4, 2014 post Spin-off to $7.32 at February 15, 2017. While the offshore contract drilling industry is highly cyclical and has experienced periods of low demand and higher demand, there can be no assurance as to when or to what extent these depressed market conditions, and our business, results of operations or enterprise value, will improve. Further, even if the price of oil and gas ~~companies~~were to ~~raise~~increase ~~capital;~~dramatically, we cannot assure you that there would be any increase in demand for our services.

•Our ~~adverse~~business ~~weather~~depends ~~conditions~~on ~~(such~~the aslevel ~~hurricanes~~of activity in the oil and ~~monsoons)~~gas industry. Adverse developments affecting the industry, including a decline in the price of oil or gas, reduced demand for oil and ~~seas;~~gas products and increased regulation of drilling and production, could have a material adverse effect on our business, financial condition and results of operations.

•Demand for drilling services depends on a variety of economic and political factors and the level of activity in offshore oil and gas exploration and development and ~~exploitation~~production markets worldwide. As noted above, the price of ~~alternative~~oil ~~fuels;~~and gas, and market expectations of potential changes in the price, significantly affect this level of activity, as well as dayrates which we can charge customers for our services. However, higher prices do not necessarily translate into increased drilling activity because our clients’ expectations of future commodity prices typically drive demand for our rigs. The price of oil and gas and the level of activity in offshore oil and gas exploration and development are extremely volatile and are affected by numerous factors beyond our control, including:

• ~~tax~~the ~~laws~~cost of exploring for, ~~regulations~~developing, producing and ~~policies~~delivering oil and gas;

• ~~advances~~the inability ~~exploration,~~of ~~development~~OPEC to set and maintain production ~~technology;~~levels and pricing;

• ~~the~~expectations ~~availability~~regarding ~~of,~~future ~~and~~energy ~~access to, suitable locations from which our customers can produce hydrocarbons.~~prices;

~~Demand~~• ~~for~~increased ~~our~~supply ~~drilling~~of ~~services~~oil ~~may~~and ~~decrease~~gas ~~due~~resulting tofrom ~~events~~onshore ~~beyond~~hydraulic ~~our~~fracturing ~~control~~activity and ~~some~~shale ~~of our customers could seek to cancel, terminate or renegotiate their contracts.~~ development;

~~Our~~• ~~business~~worldwide ~~could~~production beand ~~impacted~~demand ~~by events beyond our control including changes in our customers’ drilling programs or budgets or their liquidity (including access to capital), changes in, or prolonged reductions of, prices~~ for oil and gas, orwhich ~~shifts~~are inimpacted ~~the relative strength of various geographic drilling markets brought on~~ by ~~economic~~changes ~~slowdown, or regional or worldwide recession, any of which could result~~ in deterioration in demand for our drilling services. In addition, our customers may cancel drilling contracts or letter agreements or letters of intent for drilling contracts, or exercise early termination rights found in some of our drilling contracts or available under local law, for a variety of reasons, many of which are beyond our control. Depending upon market conditions, our customers may also seek renegotiation of firm drilling contracts to reduce their obligations. If the ~~level~~rate of ~~demand~~economic ~~for~~growth ~~our drilling services or conditions~~ in the ~~offshore~~global ~~contract drilling industry declines, our financial position, results of operations and cash flows could be adversely affected.~~ economy;

We• ~~may~~potential ~~not~~acceleration bein ~~able~~the todevelopment, ~~renew~~and orthe ~~replace~~price ~~expiring~~and ~~contracts~~availability, orof ~~obtain~~alternative ~~contracts for our uncontracted newbuilds.~~ fuels;

We• ~~have~~the alevel ~~number~~ of ~~customer~~production ~~contracts that will expire~~ in 2013 and 2014. Our ability to renew these contracts or obtain new contracts and the terms of any such contracts will depend on market conditions and our customers. Also, of the units we currently have under construction as part of our newbuild program, two of the ultranon-~~deepwater~~OPEC drillships and two of the heavy-duty, harsh environment jackups are being constructed without customer contracts. We will attempt to secure contracts for these units prior to their completion. We may be unable to renew our expiring contracts or obtain new contracts for our newbuilds or the rigs under contracts that have expired or been terminated, and the dayrates under any new contracts may be below, perhaps substantially below, the existing dayrates, which could have a material adverse effect on our results of operations and cash flows. We may continue speculative building, even in the absence of contracts for our units already under construction. countries;

~~Our~~• ~~global~~worldwide ~~operations~~financial ~~involve~~instability ~~additional~~or ~~risks.~~ recessions;

We• ~~operate~~regulatory inrestrictions ~~various~~or ~~regions~~any ~~throughout~~moratorium ~~the~~on ~~world~~offshore ~~that may expose us to political and other uncertainties, including risks of:~~ drilling;

• ~~terrorist~~the ~~acts,~~discovery ~~war,~~rate ~~revolution~~of new oil and ~~civil~~gas ~~disturbances~~reserves either onshore or offshore;

• ~~seizure,~~the ~~nationalization~~rate orof ~~expropriation~~decline of ~~property~~existing orand ~~equipment~~new oil and gas reserves;

• ~~monetary~~available ~~policies,~~pipeline ~~government debt downgrades~~ and ~~potential~~other ~~defaults,~~oil and ~~foreign~~gas ~~currency~~transportation ~~fluctuations and devaluations~~capacity;

• ~~the~~oil ~~inability~~refining ~~to repatriate income or capital~~capacity;

• ~~complications~~the ~~associated~~ability ~~with~~of ~~repairing~~oil and ~~replacing~~gas ~~equipment~~companies into ~~remote~~raise ~~locations~~capital;

• ~~piracy;~~10

• ~~import-export~~worldwide ~~quotas,~~instability ~~wage~~in ~~and~~the ~~price~~financial ~~controls,~~and ~~imposition~~credit ofsectors ~~trade~~and ~~barriers~~a ~~and~~reduction ~~other~~in ~~forms~~the availability of ~~government~~liquidity ~~regulation~~ and ~~economic conditions that are beyond our control~~credit;

• ~~regulatory~~the orrelative ~~financial~~cost ~~requirements~~of tooffshore ~~comply~~drilling ~~with~~versus ~~foreign~~onshore ~~bureaucratic~~oil ~~actions;~~ and gas production;

• ~~changing~~advances ~~taxation~~in ~~policies.~~exploration, development and production technology either onshore or offshore;

9• technical advances affecting energy consumption, including the displacement of hydrocarbons through increasing transportation fuel efficiencies;

~~Table~~• ofmerger ~~Contents~~and divestiture activity among oil and gas producers;

~~Our~~• ~~operations~~the ~~are~~availability ~~subject~~of, ~~to various laws~~ and ~~regulations~~access into, ~~countries~~suitable inlocations from which weour ~~operate, including~~customers ~~laws~~can ~~and~~produce ~~regulations relating to:~~ hydrocarbons;

• ~~the~~adverse ~~importing~~weather conditions, ~~exporting~~including hurricanes, ~~equipping~~typhoons, ~~and~~winter ~~operation~~storms ofand ~~drilling~~rough ~~units~~seas;

• ~~repatriation~~tax oflaws, ~~foreign~~regulations ~~earnings~~and policies;

• ~~currency~~laws ~~exchange~~and ~~controls~~regulations related to environmental matters, including those addressing alternative energy sources and the risks of global climate change;

• the political environment of oil-producing ~~and~~regions, ~~gas~~including ~~exploration~~uncertainty ~~and~~or ~~development~~instability resulting from civil disorder, an outbreak or escalation of armed hostilities or acts of war or terrorism; and

• ~~taxation~~the laws and regulations of ~~offshore~~governments ~~earnings~~regarding exploration and ~~earnings~~development of ~~expatriate~~their ~~personnel;~~oil and gas reserves or speculation regarding future laws or regulations.

•Adverse ~~use~~developments affecting the industry as a result of one or more of these factors, including any further decline in the price of oil and ~~compensation~~gas from their current depressed levels or the failure of ~~local~~the ~~employees~~price of oil and ~~suppliers~~gas byto ~~foreign~~recover ~~contractors~~to a level that encourages our clients to expand their capital spending, a global recession, reduced demand for oil and gas products, increased supply due to the development of new onshore drilling and production technologies, and increased regulation of drilling and production, particularly if several developments were to occur in a short period of time, would have a material adverse effect on our business, financial condition and results of operations. The current downturn has already had a material adverse effect on demand for our services and is expected to have a material adverse effect on our business and results of operations.

~~Our~~The ~~ability~~contract todrilling doindustry ~~business~~is in a ~~number~~highly ofcompetitive ~~jurisdictions is subject to maintaining required licenses~~ and ~~permits~~cyclical ~~and~~business ~~complying~~ with ~~applicable~~ ~~laws~~intense ~~and~~price ~~regulations~~competition. For example, as of December 31, 2012, our two rigs operating in Nigeria were operating under temporary import permits and the Department of Petroleum Resources had not yet issued our Nigerian subsidiary a permit to operate as an oil industry service company or licenses to operate the two rigs for the year 2013. It is customary in Nigeria that permits and licenses are issued well into the year to which they pertain and, to date, we have been successful in obtaining new, or extending existing, temporary import permits and other permits and licenses. However, there can be no assurance that we will be able to obtain new permits or further extensions of permits necessary to continue the operation of our rigs in Nigeria. If we ~~cannot~~are ~~obtain~~unable ~~a new permit or an extension necessary~~ to ~~continue~~compete ~~operations of any rig~~successfully, ~~we may need to cease operations under the drilling contract for such rig and relocate such rig from Nigerian waters. We cannot predict what impact these events may have on any such contract or~~ our ~~business~~profitability ~~in Nigeria, and we could face additional fines and sanctions in Nigeria. Furthermore, we cannot predict what changes, if any, relating to temporary import permit policies and procedures~~ may be ~~established~~materially ~~or implemented in Nigeria in the future, or how any such changes may impact our business there~~reduced. For additional information regarding our completed internal investigation of our Nigerian operations and the status of our temporary import permits in Nigeria, see “Part II Item 8. Financial Statements and Supplementary Data, Note 16 — Commitments and Contingencies.” Changes in, compliance with, or our failure to comply with the laws and regulations of the countries where we operate, including Nigeria, may negatively impact our operations in those countries and could have a material adverse effect on our results of operations.

InThe ~~2010~~offshore ~~the~~contract ~~Nigerian~~drilling ~~Oil~~industry ~~and Gas Industry Content Development Bill was signed into law. The law~~ is ~~designed~~a tohighly ~~create~~competitive ~~Nigerian content in operations~~ and ~~transactions~~cyclical ~~within~~business ~~the~~characterized ~~Nigerian~~by ~~oil~~high capital and ~~gas~~operating ~~industry.~~costs ~~The law sets forth certain requirements for asset ownership~~ and ~~the~~evolving ~~utilization~~capability of ~~Nigerian~~newer ~~human~~rigs. ~~resources~~Drilling ~~and~~contracts ~~goods~~are ~~and~~traditionally ~~services~~awarded inon ~~oil and gas projects and creates~~ a ~~Nigerian Content~~competitive ~~Development~~bid ~~and~~basis. ~~Monitoring~~Intense ~~Board~~price tocompetition, ~~implement~~rig ~~and~~availability, ~~monitor~~location ~~the law~~ and ~~develop~~suitability ~~regulations~~are ~~pursuant to~~ the ~~law.~~primary ~~The~~factors ~~Nigerian~~in ~~Content~~determining ~~Development~~which ~~and~~contractor ~~Monitoring~~is ~~Board~~awarded ~~has~~a ~~indicated~~job, ~~that~~although itother ~~will~~factors ~~require~~are ~~all~~important, ~~non-Nigerian~~including ~~offshore~~experience ~~drilling companies~~of tothe ~~reorganize~~workforce, ~~their~~efficiency, ~~local~~safety ~~operations~~performance torecord, ~~include~~technical ~~Nigerian~~capability ~~indigenous~~and ~~minority~~condition ~~interests~~of inequipment, ~~the~~ operating ~~assets~~integrity, ~~and~~reputation, toindustry ~~obtain~~standing ~~the approval of the Nigerian Content Development~~ and ~~Monitoring~~client ~~Board~~relations. ~~for~~Our future ~~work~~success inand ~~Nigeria.~~profitability ~~The~~will ~~law~~partly ~~also establishes~~depend aupon ~~Nigerian~~our ~~Content~~ability ~~Development Fund~~ to ~~fund~~keep ~~the~~pace ~~implementation~~with ofour ~~the~~customers’ ~~law,~~demands ~~and~~with ~~requires~~respect ~~that~~to 1these ~~percent~~factors. ofIf ~~the~~current ~~value~~competitors, ofor ~~every~~new ~~contract~~market ~~awarded~~entrants, inimplement ~~the~~new ~~Nigerian~~technical ~~oil~~capabilities, ~~and~~services ~~gas~~or ~~industry~~standards bethat ~~paid~~are ~~into~~more ~~the~~attractive ~~fund. We continue~~ to ~~closely monitor the implementation of the law and we are in the process of reviewing~~ our ~~structural~~customers ~~and~~or ~~strategic~~price ~~alternatives~~their ~~and~~product ~~the~~offerings ~~associated~~more ~~cost~~competitively, asit ~~the~~could ~~law~~have ~~continues~~a tomaterial beadverse ~~applied.~~effect ~~We cannot predict what impact the law will ultimately have~~ on ~~the drilling industry and~~ our ~~future operations in Nigeria~~business, ~~but~~financial ~~the~~condition ~~effect on our operations~~ and ~~profitability~~results inof ~~the region could be significant~~operations.

In addition, ~~other~~to ~~governmental~~intense ~~actions~~competition, ~~including~~our ~~initiatives~~industry byhas ~~OPEC,~~historically ~~may~~been ~~continue~~cyclical. toThe ~~cause~~contract ~~oil~~drilling ~~price~~industry ~~volatility.~~is Incurrently ~~some~~in ~~areas~~a ofperiod ~~the~~characterized ~~world,~~by ~~this~~low ~~governmental~~demand ~~activity~~for ~~has~~drilling ~~adversely~~services ~~affected~~and ~~the~~excess ~~amount~~ rig supply. Periods of ~~exploration~~low ~~and~~demand ~~development~~or ~~work~~excess ~~done~~rig bysupply ~~major~~intensify ~~oil~~the ~~companies,~~competition ~~which~~in ~~may~~the ~~continue.~~industry Inand ~~addition,~~may ~~some~~result ~~governments~~in ~~favor~~some orof ~~effectively~~our ~~require~~rigs ~~the~~being ~~awarding~~idle ofor ~~drilling~~earning ~~contracts~~substantially tolower ~~local~~dayrates ~~contractors,~~for ~~require~~long ~~use~~periods of atimes. ~~local~~We ~~agent~~cannot orprovide ~~require~~you ~~foreign contractors~~with toany ~~employ~~assurances ~~citizens~~as ~~of,~~to orwhen ~~purchase~~such ~~supplies~~period ~~from~~will end, aor ~~particular~~when ~~jurisdiction.~~there ~~These~~will ~~practices~~be ~~may~~higher ~~adversely~~demand ~~affect~~for ~~our~~contract ~~ability~~drilling toservices ~~compete~~or ~~and~~a ~~our~~reduction ~~results~~in the number of ~~operations.~~drilling rigs.

The ~~U.S.~~over-supply ~~government’s~~of ~~regulations~~rigs is contributing to a reduction in dayrates and ~~permitting~~demand ~~process~~for ~~could~~our ~~have~~rigs, awhich ~~prolonged~~reduction may continue for some time and, ~~material~~therefore, ~~adverse~~is ~~impact~~expected onto ~~our~~further ~~U.S.~~adversely ~~Gulf of~~impact ~~Mexico~~our ~~operations.~~revenues and profitability.

~~Subsequent~~Prior to the ~~April~~recent ~~2010 fire and explosion on the Deepwater Horizon~~downturn, ~~a competitor’s~~we ~~drilling~~experienced ~~rig~~an inextended ~~the~~period ~~U.S. Gulf~~ of ~~Mexico,~~high ~~U.S.~~utilization ~~governmental~~and ~~authorities~~high ~~implemented~~dayrates, ~~a moratorium on~~ and ~~suspension~~industry ofparticipants ~~specified~~materially ~~types~~increased ~~of drilling activities in~~ the ~~U.S.~~supply ~~Gulf~~ of ~~Mexico.~~drilling Inrigs ~~October~~by ~~2010,~~building ~~the U.S. government lifted the moratorium following adoption of~~ new ~~regulations including a~~ drilling ~~safety rule and a workplace safety rule~~rigs, ~~each~~including ofsome ~~which~~that ~~imposed~~have ~~multiple~~not ~~obligations~~yet ~~relating~~entered ~~to offshore drilling operations~~service. ~~These~~ ~~obligations~~This ~~relate~~increase toin supply, ~~among~~combined ~~other things; additional certifications and verifications relating to compliance~~ with ~~applicable~~the ~~regulations,~~decrease ~~compatibility~~in ofdemand ~~blowout~~for ~~preventers with~~ drilling rigs ~~and~~resulting ~~well~~from ~~design,~~the ~~third-party~~substantial ~~inspections~~decline ~~and~~in ~~design~~the ~~review~~price of ~~blowout~~oil ~~preventers,~~since ~~testing of casing installations~~mid-2014, ~~minimum~~has ~~requirements~~resulted ~~for personnel operating blowout preventers, training~~ in ~~deepwater~~an ~~well~~oversupply ~~control and mandates~~ of ~~maintenance~~drilling ~~inspections. BSEE’s~~rigs, ~~predecessor~~which ~~agency~~has ~~also~~contributed ~~proposed~~ to ~~further~~the ~~strengthen~~recent ~~these regulations~~decline in ~~September~~utilization ~~2011. These additional regulations led to additional costs~~ and ~~increased downtime in our U~~dayrates.~~S. Gulf of Mexico fleet.~~

10We are currently experiencing competition from newbuild rigs that have either already entered the market or are scheduled to enter the market. The entry of these rigs into the market has resulted in lower dayrates for both newbuilds and existing rigs rolling off their current contracts. Lower utilization and dayrates have adversely affected our revenues and profitability and may continue to do so for some time in the future. In addition, our competitors may relocate rigs to geographic markets in which we operate, which could exacerbate excess rig supply and result in lower dayrates and utilization in those markets. To the extent that the drilling rigs currently under construction or on order do not have contracts upon their completion, there may be increased price competition as such vessels become operational, which could lead to a further reduction in dayrates and in utilization, and we may be required to idle additional drilling rigs. As a result, our business, financial condition and results of operations would be materially adversely affected.

~~Table~~ ~~of Contents~~11

~~The~~We ~~U.S.~~may ~~government~~record ~~mandated~~additional ~~that~~losses ~~before~~or ~~beginning~~impairment acharges ~~well~~related in the U.S. Gulf of Mexico an operator must: (i) demonstrate that containment resources are available promptly in the event of a deepwater blowout, (ii) have the chief executive officer of the operator seeking to ~~perform~~rigs ~~deepwater drilling certify that the operator has complied with all applicable regulations and (iii) allow BSEE~~ to ~~conduct~~be ~~inspections~~sold ofor ~~such~~cold ~~deepwater~~stacked ~~drilling~~or ~~operation for compliance with the applicable regulations. Our customers and~~ other ~~operators~~capital ~~struggled to implement these new regulations, which resulted in increased downtime and decreased rates for a number of our contracted units when these regulations were instituted~~equipment. While it appears that operators have become accustomed to these regulations, we cannot predict whether the permitting will continue at the current rate. Increased costs for our customers’ operations and permitting delays could negatively impact their planned or future exploration and development activities, which could result in reduced demand for our services.

~~Governmental~~We ~~laws~~evaluate the impairment of property and ~~regulations,~~equipment whenever events or changes in circumstances (including ~~environmental~~a ~~laws~~decision ~~and~~to ~~regulations~~cold stack, retire or sell rigs) indicate that the carrying amount of an asset may ~~add~~not be recoverable. In addition, on an annual basis, we complete an impairment analysis on our rig fleet and capital spares. An impairment loss on our property and equipment may exist when the estimated undiscounted cash flows expected to result from the use of the asset and its eventual disposition are less than its carrying amount. Any impairment loss recognized represents the excess of the asset’s carrying value over the estimated fair value. As part of this analysis, we make assumptions and estimates regarding future market conditions. To the extent actual results do not meet our ~~costs~~estimated assumptions, for a given rig or ~~limit~~piece of equipment, we may take an impairment loss in the future. For example, based upon our ~~drilling~~annual ~~activity~~impairment analysis as of the end of 2016 and 2015, we decided that we would no longer market certain rigs. In connection with these decisions, we recorded impairment charges of $285 million and $372 million, respectively, on these rigs during those periods. In addition, based upon our annual impairment analysis as of the end of 2016, we partially impaired the carrying value of three rigs to the estimated fair value and recorded an impairment charge of $1 billion. There can be no assurance that we will not have to take additional impairment charges in the future if current depressed market conditions persist.

~~Our~~We ~~business~~may isnot ~~affected~~be byable ~~public~~to ~~policy~~renew ~~and~~or ~~laws~~replace expiring contracts, and ~~regulations~~our ~~relating~~ customers may terminate or seek to ~~the~~renegotiate ~~energy~~or ~~industry~~repudiate ~~and~~our ~~the~~drilling ~~environment~~contracts inor ~~the~~may ~~geographic~~have ~~areas~~financial ~~where~~difficulties wewhich ~~operate.~~prevents them from meeting their obligations under our drilling contracts.

~~The~~We ~~drilling~~had ~~industry~~a isnumber ~~dependent~~of ~~on demand~~customer ~~for~~contracts ~~services~~that ~~from~~expired ~~the~~in ~~oil~~2016 and ~~gas~~will ~~exploration~~expire ~~and~~in ~~production~~2017 ~~industry,~~ and ~~accordingly,~~2018. weOur ~~are~~ability ~~directly~~to ~~affected~~renew bythese ~~the~~contracts ~~adoption~~or ofobtain ~~laws~~new contracts and ~~regulations~~the ~~that~~terms ~~for~~of ~~economic,~~any ~~environmental~~such orcontracts ~~other~~will ~~policy~~depend ~~reasons~~on ~~curtail~~market ~~exploration~~conditions and ~~development~~ ~~drilling~~our ~~for~~customers' ~~oil~~expectations and ~~gas.~~assumptions Weof ~~may~~future beoil ~~required~~prices toand ~~make~~other ~~significant~~factors. ~~capital~~During ~~expenditures~~2016, toa ~~comply~~number ~~with~~of ~~governmental~~oil ~~laws~~ and ~~regulations.~~gas ~~Governments~~companies, inincluding some ~~foreign~~of ~~countries~~our ~~are~~customers, ~~increasingly~~have ~~active~~publicly inannounced ~~regulating~~significant ~~and~~reductions ~~controlling~~in ~~the ownership~~their ofplanned ~~concessions, the~~ exploration ~~for~~and ~~oil~~development ~~and~~spending ~~gas,~~during 2017 and ~~other~~beyond. ~~aspects~~These ofreductions ~~the~~in ~~oil~~spending ~~and~~by ~~gas~~our ~~industries.~~customers ~~There~~could isfurther ~~increasing~~reduce ~~attention~~the indemand ~~the~~for ~~United~~contract ~~States~~drilling services and ~~worldwide~~as ~~concerning~~a ~~the~~result, ~~issue~~our ofbusiness, ~~climate~~financial ~~change~~condition and ~~the~~results ~~effect~~ of ~~greenhouse~~operations ~~gases~~would be materially adversely affected.

Our ~~operations~~customers ~~are~~may ~~also~~generally ~~subject~~terminate toour ~~numerous~~term ~~laws~~drilling ~~and~~contracts ~~regulations~~if ~~controlling~~a ~~the~~drilling ~~discharge~~rig ofis ~~materials~~destroyed ~~into~~or ~~the~~lost ~~environment~~ or ~~otherwise~~if ~~relating~~we have to ~~the~~suspend ~~protection~~drilling ofoperations ~~the~~for ~~environment.~~a ~~The~~specified ~~modification~~period of ~~existing~~time ~~laws~~as ora ~~regulations~~result orof ~~the~~a ~~adoption~~breakdown of ~~new~~major ~~laws~~equipment or, ~~regulations that result~~ in ~~the~~some ~~curtailment~~cases, ofdue ~~exploratory~~to orother ~~developmental~~events ~~drilling~~beyond ~~for~~the ~~oil~~control ~~and~~of ~~gas~~either ~~could materially and adversely affect our operations by limiting drilling opportunities or imposing materially increased costs~~party. AsIn ~~a result,~~ the ~~application~~case of ~~these~~nonperformance ~~laws~~and ~~could~~under ~~have~~certain aother ~~material~~conditions, ~~adverse effect on~~ our ~~results~~drilling ofcontracts ~~operations~~generally byallow ~~increasing~~ our ~~cost~~ ~~of doing business, discouraging our~~ customers ~~from~~to ~~drilling~~terminate ~~for~~without ~~hydrocarbons~~any orpayment ~~subjecting us~~ to ~~liability~~us. ~~For~~The ~~example,~~terms ~~we,~~of assome ~~an operator~~ of ~~mobile~~our ~~offshore~~ drilling ~~units~~contracts inpermit ~~navigable~~the ~~U.S.~~customer ~~waters~~to ~~and~~terminate ~~certain offshore areas, including~~ the ~~U.S.~~ ~~Outer~~contract ~~Continental~~after ~~Shelf,~~a ~~are~~specified ~~liable~~notice ~~for~~period ~~damages~~by ~~and~~tendering ~~for~~contractually ~~the~~specified ~~cost~~termination ofamounts ~~removing~~and, ~~oil~~in ~~spills~~some ~~for~~cases, ~~which~~without weany ~~may~~payment. beThese ~~held~~termination ~~responsible~~payments, ~~subject~~if toany, ~~certain~~may ~~limitations.~~not ~~Our~~fully ~~operations~~compensate ~~may~~us ~~involve~~for the ~~use~~loss ~~or handling~~ of ~~materials~~a ~~that are classified as environmentally hazardous~~contract. ~~Laws~~The ~~and~~early ~~regulations~~termination ~~protecting~~of ~~the~~a ~~environment~~contract ~~have~~may ~~generally~~result ~~become more stringent and~~ in ~~certain circumstances impose “strict liability”, rendering~~ a ~~person~~rig ~~liable~~being idle for ~~environmental~~an ~~damage~~extended ~~without~~period ~~regard~~of ~~to negligence~~time ~~or fault. Environmental laws~~ and ~~regulations~~a ~~may~~reduction ~~expose~~in usour tocontract ~~liability~~backlog ~~for~~and ~~the~~associated ~~conduct~~revenue, ofwhich orcould ~~conditions~~have ~~caused~~a bymaterial ~~others~~adverse oreffect ~~for~~on ~~acts~~our ~~that~~business, ~~were~~financial incondition ~~compliance~~and ~~with~~results ~~all~~of ~~applicable laws at the time they were performed~~operations.

In ~~November 2012~~addition, ~~the~~during ~~U.S.~~periods ~~Coast~~of ~~Guard~~depressed inmarket ~~Alaska~~conditions, ~~conducted~~such anas ~~inspection~~the ofone ~~our~~we ~~drillship~~are currently experiencing, ~~the~~we ~~Noble~~are ~~Discoverer,~~subject ~~and~~to ~~cited~~an ~~a number~~increased risk of ~~deficiencies~~our ~~that~~customers ~~needed~~seeking to berenegotiate ~~remediated,~~or ~~including~~repudiate ~~issues~~their ~~relating~~contracts. toThe ~~the~~ability ~~main~~of ~~propulsion~~our ~~and~~customers ~~safety~~to ~~management~~perform ~~system.~~their Weobligations ~~began~~under andrilling ~~internal~~contracts ~~investigation~~with inus ~~conjunction~~may ~~with~~also be adversely affected by the ~~Coast~~financial ~~Guard~~condition ~~inspection~~of the customer, ~~and~~restricted ~~the~~credit ~~Coast~~markets, ~~Guard~~economic ~~began~~downturns ~~their own~~and ~~investigation.~~industry Wedownturns, ~~reported~~such ~~certain~~as ~~potential~~the ~~violations~~one ofwe ~~applicable~~are ~~law~~currently toexperiencing. ~~the~~We ~~Coast~~may ~~Guard~~elect asto arenegotiate ~~result~~the ofrates ~~our~~we ~~internal~~receive ~~investigation.~~under ~~These~~our ~~related~~drilling tocontracts ~~what~~downward if we ~~believe~~determine ~~were~~that ~~certain~~to ~~unauthorized~~be ~~disposals~~a ofreasonable ~~collected~~business ~~deck~~solution. ~~and~~If ~~sea~~our ~~water~~customers ~~from~~cancel ~~the Noble~~or ~~Discoverer~~are ~~and~~unable ~~potential~~to ~~record-keeping~~perform ~~issues~~their ~~with~~obligations ~~the~~under ~~oil~~their ~~record~~drilling ~~books~~contracts, ~~for~~including ~~the~~their ~~Noble~~payment ~~Discoverer~~obligations, and ~~other~~we ~~rigs.~~are ~~The~~unable ~~Coast~~to ~~Guard~~secure ~~has~~new ~~referred~~contracts ~~the~~on ~~Noble~~a ~~Discoverer~~timely ~~matter~~basis toon ~~the~~substantially ~~U.S.~~similar ~~Department~~terms ofor ~~Justice~~if ~~(“DOJ”) for~~we ~~further~~elect ~~investigation.~~to ~~For~~renegotiate ~~additional~~our ~~information~~drilling ~~regarding~~contracts ~~these~~and ~~actions~~accept ~~relating~~terms tothat ~~the~~are ~~Alaska~~less ~~investigation~~favorable to us, ~~see~~it ~~“Part~~could ~~II,~~have ~~Item 8.~~a ~~Financial~~material ~~Statements~~adverse ~~and~~effect ~~Supplementary~~on ~~Data~~our business, ~~Note~~financial ~~16—~~condition ~~Commitments~~ and ~~Contingencies~~results of operations.”

11Our current backlog of contract drilling revenue may not be ultimately realized.

~~Table~~Generally, contract backlog only includes future revenues under firm commitments; however, from time to time, we may report anticipated commitments under letters of ~~Contents~~intent or award for which definitive agreements have not yet been, but are expected to be, executed. We may not be able to perform under these contracts as a result of operational or other breaches or due to events beyond our control, and we may not be able to ultimately execute a definitive agreement in cases where one does not currently exist. Moreover, we can provide no assurance that our customers will be able to or willing to fulfill their contractual commitments to us or that they will not seek to renegotiate or repudiate their contracts, especially during the current industry downturn. In estimating backlog, we make certain assumptions about applicable dayrates for our longer term contracts with dayrate adjustment mechanisms (like certain of our contracts with Shell). While we believe these assumptions are appropriate, we cannot assure you that actual results will mirror these assumptions. Our inability to perform under our contractual obligations or to execute definitive agreements, our customers’ inability or unwillingness to fulfill their contractual commitments to us, including as a result of contract repudiations or our decision to accept less favorable terms on our drilling contracts, or the failure of actual results to reflect the

~~Worldwide~~ ~~instability in the financial and credit sectors and economic recession could have a material adverse effect on our financial position, results of operations and cash flows.~~ 12

~~Worldwide~~assumptions ~~instability in~~we ~~the~~use ~~financial and credit sectors could reduce the availability of liquidity and credit~~ to ~~fund~~estimate ~~the~~backlog continuation and expansion of industrial business operations worldwide. The shortage of liquidity and credit combined with substantial losses in worldwide equity markets could lead to another global economic recession. A slowdown in economic activity caused by a worldwide recession, combined with lower prices for ~~oil~~certain ~~and gas, would reduce worldwide demand for energy and demand for drilling services. If demand for drilling services declines again, we could experience a decline in dayrates for new~~ contracts and a slowing in the pace of new contract activity. Demand for our services depends on oil and natural gas industry activity and expenditure levels that are directly affected by trends in oil and natural gas prices. Demand for our services is particularly sensitive to the level of exploration, ~~development,~~may and production activity of, and the corresponding capital spending by, oil and natural gas companies. Any prolonged reduction in oil and natural gas prices or material impairment of our customers’ cash flow or liquidity, including their access to capital, could result in lower levels of exploration, development and production activity. Lower levels of exploration activity could result in a corresponding decline in the demand for our drilling services, which could have a material adverse effect on our ~~financial position~~business, ~~results~~ offinancial ~~operations~~condition and ~~cash~~results ~~flows. The financial situation may also adversely affect the ability~~ of ~~shipyards to meet scheduled deliveries of our newbuilds and our ability to renew our fleet through new vessel construction projects and conversion projects~~operations.

We are substantially dependent on several of our customers, including Shell and ~~Petrobras~~Statoil ASA, and the loss of these customers ~~could~~would have a material adverse effect on our financial condition and results of operations.

~~We estimate~~Any ~~Shell~~concentration ~~and~~of ~~Petrobras~~customers ~~represented~~increases the risks associated with any possible termination or nonperformance of drilling contracts, failure to renew contracts or award new contracts or reduction of their drilling programs. Shell accounted for approximately 6138 percent of our consolidated operating revenues in 2016 and 14represents ~~percent,~~approximately ~~respectively,~~69 percent of our backlog at December 31, ~~2012~~2016. ~~and~~While ~~revenues~~Statoil ~~from~~ASA ~~Shell~~(“Statoil”) ~~and~~only ~~Petrobras~~represented ~~accounted~~one ~~for~~percent ~~approximately~~of 32our ~~percent~~consolidated ~~and~~operating 14revenues ~~percent~~for the year ended December 31, ~~respectively~~2016, we expect Statoil to represent a more significant portion of our ~~total~~contract ~~operating~~drilling revenue ~~for~~in the next few years due to the commencement of a four-year ~~ended~~North Sea drilling contract by the Noble Lloyd Noble in November 2016. As a result of this contract commencement, Statoil now represents 18 percent of our backlog at December 31, ~~2012~~2016. This concentration of customers increases the risks associated with any possible termination or nonperformance of contracts, in addition to our exposure to credit risk. If either of these customers were to terminate or fail to perform their obligations under their contracts and we were not able to find other customers for the affected drilling units promptly, our financial condition and results of operations could be materially adversely affected.

~~Construction,~~Supplier ~~conversion~~capacity constraints or ~~upgrades~~shortages ofin ~~rigs~~parts ~~are~~or ~~subject~~equipment, tosupplier ~~risks~~production disruptions, ~~including~~supplier ~~delays~~quality and ~~cost~~ ~~overruns,~~sourcing ~~which~~issues ~~could~~or ~~have~~price anincreases ~~adverse~~could ~~impact~~increase on our ~~available~~operating ~~cash~~costs, ~~resources~~decrease our revenues and ~~results~~adversely ofimpact our operations.

~~We currently~~Our ~~have~~reliance ~~multiple~~on ~~new~~third-party ~~construction~~suppliers, manufacturers and ~~conversion~~service ~~projects~~providers ~~underway~~to ~~and~~secure weequipment ~~may~~used ~~undertake~~in ~~additional~~our ~~projects~~drilling operations exposes us to volatility in the ~~future.~~quality, Inprice ~~addition,~~and weavailability ~~make~~of ~~significant~~such ~~upgrade,~~items. ~~refurbishment~~Certain specialized parts and ~~repair~~equipment ~~expenditures~~we touse in our ~~fleet~~operations ~~from~~may ~~time~~be toavailable ~~time, particularly~~only asfrom ~~our~~a ~~rigs~~single ~~become~~or ~~older.~~small ~~Some~~number of ~~these~~suppliers. ~~expenditures~~A ~~are~~disruption ~~unplanned.~~in ~~Our~~the ~~customers~~deliveries ~~may~~from ~~also~~such ~~require~~third-party ~~certain~~suppliers, ~~shipyard~~capacity ~~reliability~~constraints, ~~upgrade~~production ~~projects~~disruptions, ~~for~~price ~~our~~increases, ~~drillships.~~defects ~~These~~or ~~projects~~quality-control ~~and~~issues, recalls or other ~~efforts~~decreased availability or servicing of ~~this~~parts ~~type~~and ~~are~~equipment ~~subject~~could adversely affect our ability to ~~risks~~meet ~~of cost~~our ~~overruns~~commitments orto ~~delays~~customers, ~~inherent~~adversely impact our operations and revenues by resulting in ~~any~~uncompensated ~~large~~downtime, ~~construction~~reduced ~~project~~day asrates aor ~~result~~the ofcancellation ~~numerous~~or ~~factors~~termination of contracts, ~~including~~or ~~the~~increase ~~following:~~our operating costs.

•Our ~~shortages~~business ofinvolves ~~equipment,~~numerous ~~materials~~operating ~~or skilled labor;~~hazards.

•Our ~~work~~operations ~~stoppages~~are ~~and~~subject ~~labor~~to ~~disputes;~~many hazards inherent in the drilling business, including:

• ~~unscheduled~~well ~~delays in the delivery of ordered materials and equipment~~blowouts;

• ~~local customs strikes or related work slowdowns that could delay importation of equipment or materials~~fires;

• ~~weather~~collisions ~~interferences~~or groundings of offshore equipment and helicopter accidents;

• ~~difficulties in obtaining necessary permits or approvals or in meeting permit or approval conditions~~punch-throughs;

• ~~design~~mechanical ~~and~~or ~~engineering~~technological ~~problems~~failures;

• ~~inadequate~~failure ~~regulatory~~of ~~support~~our ~~infrastructure~~employees inor ~~the~~third ~~local~~party ~~jurisdiction~~contractors to comply with our internal environmental, health and safety guidelines;

• ~~latent~~pipe ~~damages~~ or ~~deterioration~~cement tofailures ~~hull,~~and ~~equipment~~casing ~~and~~collapses, ~~machinery~~which incould ~~excess~~release ofoil, ~~engineering~~gas ~~estimates~~or ~~and~~drilling ~~assumptions~~fluids;

• ~~unforeseen~~geological ~~increases~~formations inwith ~~the~~abnormal ~~cost of equipment, labor and raw materials, particularly steel~~pressures;

• ~~unanticipated~~loop ~~actual~~currents or ~~purported change orders~~eddies;

• ~~client~~failure ~~acceptance~~of ~~delays~~critical equipment;

12• toxic gas emanating from the well;

~~Table~~• spillage handling and disposing of ~~Contents~~materials; and

• ~~disputes~~adverse ~~with~~weather ~~shipyards~~conditions, including hurricanes, typhoons, tsunamis, winter storms and ~~suppliers;~~rough seas.

•These ~~delays~~hazards could cause personal injury or loss of life, suspend drilling operations, result in regulatory investigation or penalties, seriously damage or ~~inability~~destroy property and equipment, result in claims by employees, customers or third parties, cause environmental damage and cause substantial damage to ~~obtain~~oil and gas producing formations or facilities. Operations also may be suspended because of machinery breakdowns, ~~access~~abnormal drilling conditions, and failure of subcontractors to ~~funding;~~perform or supply goods or services or personnel shortages. The occurrence of any of the hazards we face could have a material adverse effect on our business, financial condition and results of operations.

•As ~~shipyard~~part ~~availability~~of our recent agreement with Paragon Offshore, ~~failures~~we agreed to assume certain Mexican tax liabilities and ~~difficulties~~bonding obligations. These tax liabilities could cost more than we expect, ~~including~~and asthe abonding ~~result~~requirements ofcould ~~financial~~be ~~problems~~greater ofthan ~~shipyards~~anticipated and also could affect our liquidity. There can be no assurance that Paragon Offshore will satisfy its tax payment, cost reimbursement or ~~their~~other ~~subcontractors;~~obligations ~~and~~when they become due. If the bankruptcy court does not approve our settlement agreement with Paragon Offshore, we could be sued by Paragon Offshore or its creditors.

• ~~failure or delay of third-party equipment vendors or service providers.~~13

~~The~~In ~~failure~~February to2016, ~~complete~~we entered into an agreement in principle (followed by a ~~rig~~definitive ~~upgrade~~settlement oragreement ~~new~~entered ~~construction~~into onin ~~time,~~April or2016 ~~the~~and ~~inability~~still subject to ~~complete~~approval aof ~~rig~~the ~~conversion~~bankruptcy orcourt ~~new~~having ~~construction~~jurisdiction ~~in accordance~~over Paragon Offshore’s bankruptcy proceeding as discussed below) for a settlement with ~~its~~Paragon ~~design~~Offshore ~~specifications~~under which, ~~may~~in ~~result~~exchange infor ~~loss~~a full and unconditional release of ~~revenues,~~any ~~penalties,~~claims orby ~~delay,~~Paragon ~~renegotiation~~Offshore orin ~~cancellation~~connection with the Spin-off (including fraudulent conveyance claims that could be brought on behalf of aParagon ~~drilling~~Offshore’s ~~contract~~creditors), orwe agreed to assume the ~~recognition~~administration of anMexican ~~asset~~tax ~~impairment.~~claims ~~Additionally,~~for ~~capital~~specified ~~expenditures~~years ~~for~~up ~~rig~~to ~~upgrade~~and including 2010, ~~refurbishment~~ ~~and~~as ~~construction~~well ~~projects~~as ~~could~~the ~~materially~~related ~~exceed~~bonding ~~our~~obligations ~~planned~~and ~~capital~~certain ~~expenditures~~of the related tax liabilities. ~~Moreover,~~We ~~our~~cannot ~~rigs~~make ~~undergoing~~any ~~upgrade,~~assurances ~~refurbishment~~regarding ~~and~~the ~~repair~~outcome ~~may~~of ~~not~~the ~~earn~~tax aassessments ~~dayrate~~and ~~during~~claims, and the ~~period~~cost ~~they~~of ~~are~~these ~~out~~liabilities and the amount of ~~service.~~bonding required could be greater than we anticipate.

We ~~could~~expect that we will be ~~adversely~~able ~~affected~~to bybond ~~violations~~amounts required in Mexico using our current bonding facility. If the amount of ~~applicable~~bonding ~~anti-corruption~~is ~~laws~~greater ~~and~~than we anticipate, or we are required to maintain such bonds longer than we anticipate, then our ~~failure~~current bonding facility may not be sufficient, and we would be required to ~~comply~~use ~~with~~other sources for the ~~terms~~bonding, ofincluding our ~~settlement~~ ~~agreements~~credit ~~with~~facility, ~~the~~which ~~DOJ~~could affect our liquidity and ~~SEC.~~reduce the availability of credit for uses other than bonding Mexican tax liabilities.

WeIn ~~operate~~addition, inParagon aOffshore ~~number~~is ofrequired ~~countries~~under ~~throughout~~ the ~~world,~~terms ~~including countries~~of ~~known~~the tosettlement ~~have~~agreement ato ~~reputation~~share ~~for~~equally ~~corruption.~~in Wethe ~~are~~payment ~~committed~~of tocertain ~~doing~~of ~~business~~the inMexican ~~accordance~~tax ~~with~~liabilities ~~applicable anti-corruption laws~~ and ~~our~~the ~~code~~costs of ~~business~~administering ~~conduct~~the ~~and~~tax ~~ethics~~claims. WeIf ~~are~~Paragon ~~subject,~~Offshore ~~however,~~is unable or unwilling to ~~the~~pay ~~risk~~its ~~that~~share ~~we,~~of ~~our~~these ~~affiliated entities~~tax liabilities or ~~their~~the ~~respective~~costs ~~officers,~~to ~~directors,~~administer ~~employees~~the ~~and~~tax ~~agents~~claims, ~~may~~we ~~take~~could ~~action~~be ~~determined~~forced to bepay inthese ~~violation~~amounts ofourselves ~~such~~and ~~anti-corruption~~seek ~~laws,~~reimbursement ~~including~~from ~~the~~Paragon UOffshore.S. ~~Foreign~~There ~~Corrupt~~can ~~Practices~~be ~~Act~~no ofassurance ~~1977~~that ~~(“FCPA”)~~Paragon ~~and~~Offshore ~~similar~~will ~~laws~~be inable ~~other countries.~~to ~~Any~~satisfy ~~violation~~its share of the ~~FCPA~~tax orliabilities, ~~other~~reimburse ~~applicable~~us ~~anti-corruption~~when ~~laws~~such ~~could~~payments ~~result~~would inbe ~~substantial~~due ~~fines, sanctions, civil and/~~or ~~criminal~~comply ~~penalties~~with ~~and~~other ~~curtailment~~obligations ofunder ~~operations~~the insettlement ~~certain~~agreement ~~jurisdictions~~or ~~and~~our ~~might~~tax ~~adversely~~sharing ~~affect~~agreement. ~~our business,~~If ~~results~~Paragon ofOffshore ~~operations~~is orunable ~~financial~~to ~~condition.~~satisfy Inthese ~~addition~~obligations, ~~actual~~the orunderlying ~~alleged~~liabilities ~~violations~~ could ~~damage~~have ~~our~~a ~~reputation~~material ~~and~~adverse ~~ability~~effect toon doour business~~. Further~~, ~~detecting,~~financial ~~investigating,~~condition and ~~resolving~~results ~~actual~~of oroperations. ~~alleged~~See ~~violations~~Part isII, ~~expensive~~Item ~~and can~~8, ~~consume~~“Financial ~~significant~~Statements ~~time~~ and ~~attention~~Supplementary ofData, ~~our~~Note ~~senior~~17 ~~management.~~– Commitments and Contingencies.”

InParagon ~~2007,~~Offshore wesought ~~began~~approval anof ~~internal~~a ~~investigation~~pre-negotiated plan of ~~the legality~~reorganization by filing for voluntary relief under ~~the~~Chapter ~~FCPA~~11 of ~~certain~~the ~~activities~~United States Bankruptcy Code in ~~Nigeria~~February 2016. InOur ~~November~~settlement ~~2010,~~agreement wewith ~~finalized~~Paragon ~~settlements~~Offshore is subject to approval of ~~this~~Paragon ~~matter~~Offshore’s ~~with~~bankruptcy ~~each~~plan. ofOn ~~the~~October ~~SEC~~28, ~~and~~2016, the ~~DOJ.~~bankruptcy ~~Under~~court ~~the~~having ~~settlements~~jurisdiction ~~with~~over the ~~DOJ~~Paragon ~~and~~Offshore ~~SEC,~~bankruptcy wedenied ~~agreed~~confirmation ~~to,~~of ~~among~~Paragon ~~other~~Offshore’s ~~things~~bankruptcy plan. On January 18, ~~pay~~2017, ~~certain~~Paragon ~~fines~~Offshore ~~and interest~~announced ~~and~~that ~~disgorge~~it ~~certain~~had ~~profits,~~reached ~~cooperate~~an agreement in principle with ~~the~~an ~~DOJ,~~ad ~~comply~~hoc ~~with~~committee ~~the~~of ~~FCPA,~~secured ~~comply~~debt ~~with~~holders ~~certain~~on ~~self-reporting~~a ~~and~~term ~~annual~~sheet ~~reporting~~to ~~obligations~~support ~~and~~a ~~comply~~new ~~with~~bankruptcy anplan. ~~injunction~~The ~~restraining~~term ussheet ~~from~~contemplates ~~violating~~that the ~~anti-bribery,~~existing ~~books~~settlement ~~and~~agreement ~~records~~ between Noble and ~~internal~~Paragon ~~controls~~Offshore ~~provisions~~will ofbe adopted under the ~~FCPA~~new bankruptcy plan. ~~Our~~Paragon ~~ability~~Offshore toalso ~~comply~~stated ~~with~~that ~~the~~it ~~terms~~will seek to obtain court approval of the ~~settlements~~new isbankruptcy ~~dependent~~plan onas soon as possible in the ~~success~~first half of ~~our~~2017. ~~ongoing~~Paragon ~~compliance~~Offshore’s ~~program~~unsecured creditors are not parties to the agreement in principle, and have formed an ad hoc committee which we expect to oppose Paragon's new bankruptcy plan, including our ~~ability~~settlement toagreement. There can be no assurance that the bankruptcy court will ultimately approve our settlement agreement with Paragon Offshore or Paragon Offshore’s bankruptcy plan or that our settlement agreement will continue to ~~manage~~be ~~our~~a ~~agents~~part ~~and~~of ~~supervise,~~their ~~train~~bankruptcy ~~and retain~~plan. ~~competent~~If ~~employees,~~for ~~and~~any reason the ~~efforts~~agreement ofis ~~our~~not ~~employees~~approved by the bankruptcy court or included in their plan or Paragon Offshore fails to ~~comply~~exit ~~with~~bankruptcy, ~~applicable~~Paragon ~~law~~Offshore ~~and~~or ~~our~~its ~~code~~creditors could become adverse to us in any potential litigation relating to the Spin-off, including any alleged fraudulent conveyance claim in connection with the creation of ~~business~~Paragon ~~conduct~~Offshore ~~and~~as ~~ethics.~~a stand-alone entity.

~~Also,~~In inconnection ~~January~~with ~~2011~~the Spin-off, ~~the~~we ~~Nigerian~~agreed ~~Economic~~to ~~and~~indemnify ~~Financial~~Paragon ~~Crimes~~Offshore ~~Commission~~for certain liabilities, and ~~the~~Paragon ~~Nigerian~~Offshore ~~Attorney~~agreed ~~General~~to ~~Office~~indemnify ~~initiated~~us anfor ~~investigation~~certain ~~into~~liabilities. ~~these~~We ~~same~~have ~~activities.~~significant Aexposure ~~subsidiary~~to oflosses ~~Noble-Swiss resolved~~resulting from this ~~matter~~obligation, ~~through~~and ~~the~~there ~~execution~~can ofbe ano ~~non-prosecution~~assurance ~~agreement~~that ~~dated~~the ~~January 28,~~Paragon ~~2011.~~Offshore ~~Pursuant~~indemnities will be sufficient to ~~this~~insure ~~agreement,~~us against the ~~subsidiary~~full ~~paid~~amount ~~$2.5~~of ~~million~~the related liabilities, or that Paragon Offshore will be able or willing to ~~resolve~~satisfy ~~all~~its ~~charges~~indemnification and ~~claims~~other ofobligations in the ~~Nigerian government~~future.

~~Any~~We ~~additional~~entered ~~investigation~~into bycertain ~~these~~agreements orwith ~~other~~Paragon ~~agencies~~Offshore ~~could~~in ~~damage~~connection ~~our~~with ~~reputation~~the ~~and result in substantial fines~~Spin-off, ~~sanctions,~~including ~~civil and/or~~a ~~criminal~~master ~~penalties~~separation ~~and curtailment of operations in certain jurisdictions and might adversely affect our business~~agreement, ~~results~~tax ofsharing ~~operations or financial condition. Further~~agreement, ~~resolving~~transition ~~any~~services ~~additional~~agreement ~~investigations could be expensive~~ and ~~consume significant~~transition ~~time~~services ~~and~~agreement ~~attention~~relating ofto our ~~senior~~operations ~~management.~~offshore For instance, in February 2012, the SEC charged one current and two former employees of ours with violating the FCPA in connection with the events that were the subject of the internal investigations we began in 2007, as described aboveBrazil. WePursuant doto ~~not believe that~~ the ~~SEC pleadings against these individuals introduce material facts that were not addressed in our internal investigation~~agreements, ~~which~~ we ~~resolved~~agreed ~~with the SEC and the DOJ in November 2010. We are not a party~~ to ~~the~~indemnify ~~SEC~~Paragon ~~proceedings~~Offshore ~~against~~for ~~these~~certain ~~individuals~~liabilities, and weParagon doOffshore ~~not~~agreed ~~believe~~to ~~the~~indemnify ~~charges~~us ~~against~~for ~~the~~certain ~~individuals~~liabilities. ~~will~~We ~~result~~could inhave ~~fines,~~significant ~~sanctions~~exposure orto ~~civil~~losses orresulting ~~criminal~~from ~~penalties~~our ~~against~~obligations ~~us.~~under ~~However,~~ these ~~actions may consume the attention of management and damage our reputation~~agreements.

~~Possible~~Third ~~changes~~parties incould ~~tax~~seek ~~laws~~to ~~could~~hold ~~affect~~us responsible for any of the liabilities that Paragon Offshore has agreed to retain, and there can be no assurance that the indemnity from Paragon Offshore will be sufficient to protect us against the full amount of such liabilities, or that Paragon Offshore will be able or willing to fully satisfy its indemnification or performance obligations. Moreover, even if we ultimately succeed in recovering from Paragon Offshore any amounts for which we are held liable, we may be temporarily required to bear these losses. If Paragon Offshore is unable or unwilling to satisfy its indemnification and other obligations, the underlying liabilities could have a material adverse effect on our ~~shareholders.~~ business, financial condition and results of operations.

We ~~operate~~may ~~through~~experience ~~various~~downgrades ~~subsidiaries~~ in ~~numerous~~our ~~countries~~credit ~~throughout the world. Consequently~~ratings, ~~we are~~which ~~subject~~would toincrease ~~changes~~our inborrowing ~~tax~~costs ~~laws,~~and ~~treaties~~potentially orreduce ~~regulations or the interpretation or enforcement thereof in Switzerland, the U.S. or jurisdictions in which we or any of~~ our ~~subsidiaries~~access ~~operate~~to oradditional ~~are incorporated~~liquidity.

13As a result of the decline in our credit ratings below investment grade in 2016, access to the commercial paper market became closed to us and we have terminated our commercial paper program. So long as such access is closed, any future borrowings

~~Table~~ ~~of Contents~~14

~~Tax~~would ~~laws~~have ~~and~~to ~~regulations~~be ~~are~~made ~~highly~~under ~~complex~~our ~~and~~revolving ~~subject~~credit ~~to interpretation~~facility. ~~Consequently,~~Our ~~we are~~revolving ~~subject~~credit tofacility ~~changing~~has ~~tax~~a ~~laws,~~provision ~~treaties and regulations in and between countries in~~ which wechanges ~~operate.~~the ~~Our~~applicable ~~income~~interest ~~tax~~rate ~~expense is~~ based upon our ~~interpretation~~credit ~~of the tax laws in effect in various countries at the time that the expense was incurred. If these laws~~ratings, ~~treaties or regulations change or other taxing authorities do not agree with our assessment of the effects of such laws, treaties~~ and ~~regulations,~~these ~~this~~reduced ~~could~~credit ~~have~~ratings aincrease ~~material adverse effect on us, including the imposition of a higher effective tax rate on~~ our ~~worldwide~~interest ~~earnings~~expense orfor aborrowings ~~reclassification~~under ~~of the tax impact of~~ our ~~significant~~revolving ~~corporate~~credit ~~restructuring transactions~~facility.

In ~~addition,~~February ~~the~~2016 ~~manner~~Moody’s inInvestors ~~which~~Service downgraded our ~~shareholders~~debt ~~are~~rating ~~taxed~~below oninvestment ~~distributions on~~grade, ~~and~~resulting ~~dispositions~~in an interest rate increase of, ~~our~~1.00% ~~shares~~on ~~could~~each beof ~~affected~~certain bynotes. ~~changes~~Effective inMarch ~~tax~~16, ~~laws~~2016, ~~treaties~~the orinterest ~~regulations~~rate oron ~~the~~our ~~interpretation~~Senior ~~or enforcement~~Notes ~~thereof~~due in2018 ~~Switzerland,~~increased to 5.00% as a result of the Udowngrade.S. orEffective ~~other~~April ~~jurisdictions~~1, in2016, ~~which~~the ~~our~~interest ~~shareholders~~rates ~~are~~on ~~resident.~~our ~~Any~~Senior ~~such~~Notes ~~changes~~due ~~could~~2025 ~~result~~and inSenior ~~increased~~Notes ~~taxes~~due ~~for~~2045 ~~our~~increased ~~shareholders~~to 6.95% and ~~affect~~7.95%, ~~the~~respectively, ~~trading~~as ~~price~~a result of ~~our~~the ~~shares~~downgrade.

~~Our~~In ~~business~~July ~~involves~~2016, ~~numerous~~S&P ~~operating~~Global ~~hazards~~Ratings issued an additional downgrade, resulting in an interest rate increase of 0.25% each, of the same notes. Effective September 16, 2016, the interest rate on our Senior Notes due 2018 increased to 5.25%. Effective October 1, 2016, the interest rates on our Senior Notes due 2025 and Senior Notes due 2045 increased to 7.20% and 8.20%, respectively. The weighted average coupon of all three tranches is now 7.12%.

~~Our~~In ~~operations~~December ~~are~~2016, ~~subject~~S&P toGlobal ~~many~~Ratings ~~hazards~~issued ~~inherent~~an inadditional ~~the drilling business~~downgrade, ~~including~~resulting ~~blowouts,~~in ~~fires~~an ~~and~~interest ~~collisions~~rate orincrease ~~groundings~~ of ~~offshore~~0.5% ~~equipment~~each, ~~and~~of ~~damage~~the orsame ~~loss from adverse weather and seas~~notes. ~~These~~Effective ~~hazards~~March ~~could~~16, ~~cause personal injury or loss of life~~2017, ~~suspend drilling operations or seriously damage or destroy~~ the ~~property~~interest ~~and~~rate ~~equipment~~on ~~involved,~~our ~~result~~Senior inNotes ~~claims~~due by2018 ~~employees,~~is ~~customers~~scheduled ~~or third parties and, in addition~~ to ~~causing environmental~~increase ~~damage, could cause substantial damage~~ to ~~oil and natural gas producing formations or facilities~~5.75% ~~Operations~~as ~~also~~a ~~may~~result ~~be suspended because~~ of ~~machinery~~the ~~breakdowns,~~downgrade. ~~abnormal~~Effective ~~drilling~~April ~~conditions~~1, ~~and failure of subcontractors to perform or supply goods or services~~2017, orthe ~~personnel~~interest ~~shortages.~~rates ~~Damage~~on toour ~~the~~Senior ~~environment~~Notes ~~could~~due ~~also~~2025 ~~result~~and ~~from~~Senior ~~our~~Notes ~~operations,~~due ~~particularly~~2045 ~~through~~are ~~oil~~scheduled ~~spillage~~to orincrease ~~extensive~~to ~~uncontrolled fires~~7.70% Weand ~~may~~8.70%, ~~also~~respectively, beas ~~subject~~a toresult ~~damage~~of ~~claims~~this ~~by oil and gas companies~~downgrade.

The ~~contract~~interest ~~drilling~~rates ~~industry~~on isthese aSenior ~~highly~~Notes ~~competitive~~may ~~and~~be ~~cyclical~~further ~~business~~increased ~~with~~if ~~intense~~our ~~price~~debt ~~competition. If~~ratings wewere ~~are~~to ~~unable~~be downgraded further (up to ~~compete~~a ~~successfully~~maximum of an additional 25 basis points). Our other outstanding senior notes, ~~our~~including ~~profitability~~the ~~may~~Senior beNotes ~~reduced~~due 2024 issued in December 2016, do not contain provisions varying applicable interest rates based upon our credit ratings.

~~The~~We ~~offshore contract drilling industry is a highly competitive and cyclical business characterized by high capital and maintenance costs. Drilling contracts~~ are ~~traditionally~~exposed ~~awarded~~to onrisks arelating competitive bid basis. Intense price competition, rig availability, location and suitability, experience of the workforce, efficiency, safety performance record, technical capability and condition of equipment, operating integrity, reputation, industry standing and client relations are all factors in determining which contractor is awarded a job. Mergers among oil and natural gas exploration and production companies from time to ~~time~~operations ~~may reduce the number of available clients, resulting~~ in ~~increased~~international ~~price competition~~locations.

~~Our~~We ~~industry~~operate has historically been cyclical. There have been periods of high demand, short rig supply and high dayrates, followed by periods of lower demand, excess rig supply and low dayrates. Periods of excess rig supply intensify the competition in ~~the~~various ~~industry~~regions ~~and~~throughout ~~may result in some of our rigs being idle for long periods of time. Prolonged periods of low utilization and low dayrates could result in~~ the ~~recognition~~world ~~of impairment charges on certain of our drilling rigs if future cash flow estimates, based upon information available to management at the time, indicate~~ that ~~the carrying value of these rigs~~ may ~~not~~expose ~~be recoverable.~~us ~~For example, in 2012 our submersible rig fleet, consisting of two cold stacked rigs, was partially impaired due~~ to ~~the~~political ~~declining market outlook for drilling services for this rig type. We estimated the fair value of the rigs based on the salvage value of the rigs~~ and aother ~~recent transaction involving a similar unit owned by a peer company (Level 2 fair value measurement). Based on these estimates~~uncertainties, weincluding ~~recognized~~risks ~~a charge~~ of ~~approximately $13 million for the year ended December 31, 2012.~~ :

~~The~~• ~~increase in supply created by the number and types of rigs being built~~seizure, asnationalization ~~well~~or asexpropriation changes in our competitors’ drilling rig fleets, could intensify price competition and require higher capital investment to keep our rigs competitive. In addition, the supply attributable to newbuild rigs, especially those being built on speculation, could cause a reduction in future dayrates. We are experiencing competition from newbuild jackups that are scheduled to enter the market in 2013 and beyond. The entry of ~~these~~property ~~newbuild~~or jackups into the market may result in lower dayrates for jackups than currently expected. Similarly, there are a number of deepwater newbuilds that are scheduled to enter the market over the next several years, which could also adversely affect the dayrates for these units. equipment;

14• monetary policies, government credit rating downgrades and potential defaults, and foreign currency fluctuations and devaluations;

~~Table~~• oflimitations ~~Contents~~on the ability to repatriate income or capital;

As• acomplications ~~result~~associated ofwith ~~our~~repairing ~~significant~~and ~~cash~~replacing ~~flow~~equipment ~~needs,~~in weremote ~~may be required to incur additional indebtedness, or delay or cancel discretionary capital expenditures.~~ locations;

~~Our~~• ~~currently anticipated cash flow needs~~repudiation, ~~both in the short-term and long-term~~nullification, ~~may~~modification ~~include~~or ~~the~~renegotiation ~~following:~~of contracts;

• ~~committed~~limitations ~~capital~~on ~~expenditures~~insurance coverage, ~~including~~such ~~expenditures~~as ~~for~~war ~~newbuild~~risk ~~projects~~coverage, ~~currently~~in ~~underway~~certain areas;

• ~~normal~~import-export ~~recurring~~quotas, ~~operating~~wage ~~expenses~~and price controls, imposition of trade barriers and other forms of government regulation and economic conditions that are beyond our control;

• ~~discretionary~~delays ~~capital~~in ~~expenditures,~~implementing ~~including~~private ~~various~~commercial ~~capital~~arrangements ~~upgrades~~as a result of government oversight;

• ~~payments~~financial ofor ~~dividends;~~operational ~~and~~difficulties in complying with foreign bureaucratic actions;

• ~~repayment~~changing oftaxation ~~maturing~~rules ~~debt.~~or policies;

In• ~~order~~other toforms ~~fund~~of ~~our~~government ~~capital~~regulation ~~expenditures,~~and weeconomic ~~may~~conditions ~~need~~that ~~funding~~are beyond ~~the amount available to us from cash generated by~~ our ~~operations,~~control ~~cash on hand~~ and borrowings under our existing bank credit facilities and commercial paper program. We may raise such additional capital in a number of ways, including accessing capital markets, obtaining additional lines of credit or disposing of assets. However, we can provide no assurance that ~~any~~create ~~of these~~operational ~~options will be available to us on terms acceptable to us or at all.~~ uncertainty;

~~Our~~• ~~ability~~governmental to obtain financing or to access the capital markets may be limited by our financial condition at the time of any such financing and the covenants in our existing debt agreements, as well as by adverse market conditions resulting from, among other things, general economic conditions and uncertainties that are beyond our control. Even if we are successful in obtaining additional capital through debt financings, incurring additional indebtedness may significantly increase our interest expense and may reduce our flexibility to respond to changing business and economic conditions or to fund working capital needs, because we will require additional funds to service our outstanding indebtedness. corruption;

We• ~~may~~piracy; delay or cancel discretionary capital expenditures, which could have certain adverse consequences including delaying upgrades or equipment purchases that could make the affected rigs less competitive, adversely affect customer relationships and ~~negatively impact our ability to contract such rigs.~~

We• ~~may have~~terrorist ~~difficulty~~acts, ~~obtaining~~war, orrevolution ~~maintaining insurance in the future~~ and ~~our~~civil ~~insurance coverage and contractual indemnity rights may not protect us against all of the risks and hazards we face~~disturbances.

WeFurther, ~~generally identify the operational hazards for which~~ we ~~will~~operate ~~procure~~in ~~insurance~~certain ~~coverage~~less-developed ~~based~~countries onwith ~~the likelihood of loss, the potential magnitude of loss, the cost of coverage, the requirements of our customer contracts and applicable~~ legal ~~requirements.~~systems Wethat doare not ~~procure~~as ~~insurance~~mature ~~coverage~~or ~~for~~predictable ~~all~~as ofthose ~~the~~in ~~potential~~more ~~risks~~developed ~~and hazards we may face. Furthermore~~countries, nowhich ~~assurance~~ can ~~be given~~lead ~~that we will be able~~ to ~~obtain~~greater ~~insurance~~uncertainty ~~against~~in ~~all~~legal ofmatters ~~the risks~~ and ~~hazards~~proceedings. weExamples ~~face~~of orchallenges ~~that~~of weoperating ~~will~~in bethese ~~able~~countries ~~to obtain or maintain adequate insurance at rates and with deductibles or retention amounts that we consider commercially reasonable.~~ include:

~~Although~~• weprocedural ~~maintain~~requirements ~~what~~for wetemporary ~~believe~~import ~~to be an appropriate level of insurance covering hazards and risks we currently encounter during our operations~~permits, ~~we do not insure against all possible hazards and risks. Furthermore, our insurance carriers may interpret our insurance policies such that they do not cover losses for~~ which ~~we make claims. Our insurance policies~~ may ~~also~~be ~~have~~difficult ~~exclusions of coverage for some losses. Uninsured exposures may include expatriate activities prohibited by U.S. laws, radiation hazards, certain loss or damage~~ to ~~property onboard our rigs and losses relating to shore-based terrorist acts or strikes.~~ obtain;

In• ~~addition,~~ the ~~damage~~effect ~~sustained to offshore oil and gas assets as a result~~ of ~~hurricanes~~certain intemporary ~~recent~~import ~~years has~~permit ~~negatively impacted the energy insurance market~~regimes, ~~resulting~~where ~~in more restrictive and expensive coverage for U.S. named windstorm perils. Accordingly, we have elected to significantly reduce~~ the ~~named~~duration ~~windstorm insurance on our rigs operating in the U.S. Gulf~~ of ~~Mexico. Presently, we insure~~ the ~~Noble~~permit ~~Jim~~does ~~Thompson,~~not ~~Noble~~coincide ~~Amos~~with ~~Runner and Noble Driller for “total loss only” when caused by a named windstorm. Our customer assumes~~ the ~~risk~~general ofterm ~~loss on the Noble Bully I due to a named windstorm event up to $450 million per occurrence pursuant to the terms~~ of the drilling contract; relating to such vessel, provided that we are responsible for the first $25 million per occurrence for such named windstorm events. The remaining rigs in the U.S. Gulf of Mexico are self-insured for named windstorm perils. Our rigs located in the Mexico portion of the Gulf of Mexico remain covered by commercial insurance for windstorm damage. If one or more future significant weather-related events occur in the Gulf of Mexico, or in any other geographic area in which we operate, we may experience increases in insurance costs, additional coverage restrictions or unavailability of certain insurance products. and

15• ongoing claims in Brazil related to withholding taxes payable on our service contracts.

~~Table~~Our ability to do business in a number of ~~Contents~~jurisdictions is subject to maintaining required licenses and permits and complying with applicable laws and regulations. Changes in, compliance with, or our failure to comply with the laws and regulations of the countries where we operate may negatively impact our operations in those countries and could have a material adverse effect on our results of operations.

~~Under~~In ~~our drilling contracts~~addition, ~~liability~~other ~~with~~governmental ~~respect~~actions, toincluding ~~personnel~~initiatives ~~and~~by ~~property is customarily assigned on a “knock-for-knock” basis~~OPEC, ~~which~~may ~~means~~continue ~~that~~to wecause ~~and~~oil ~~our~~price ~~customers~~volatility. ~~assume~~In ~~liability~~some ~~for~~areas ~~our~~of ~~respective~~the ~~personnel and property~~world, ~~irrespective~~this ofgovernmental ~~the~~activity ~~fault~~has oradversely ~~negligence~~affected of the ~~party~~amount ~~indemnified.~~of ~~Although~~exploration ~~our~~and ~~drilling contracts~~development ~~generally~~work ~~provide~~done ~~for~~by ~~indemnification~~major ~~from~~oil ~~our~~companies, ~~customers~~which ~~for~~may ~~certain~~continue. ~~liabilities~~In addition, ~~including~~some ~~liabilities~~governments ~~resulting~~favor ~~from pollution~~ or ~~contamination~~effectively ~~originating~~require ~~below~~ the ~~surface~~awarding of ~~the~~drilling ~~water,~~contracts ~~enforcement of these contractual rights~~ to ~~indemnity~~ ~~may~~local becontractors, ~~limited~~require byuse ~~public~~of ~~policy~~a ~~and~~local ~~other considerations and~~agent, inrequire ~~any~~partial ~~event,~~local ~~may~~ownership ~~not~~or ~~adequately~~require ~~cover~~foreign ~~our~~contractors ~~losses from such incidents. There can also be no assurance that those parties with contractual obligations~~ to ~~indemnify~~employ ~~us will necessarily be in a financial position to do so.~~

~~Although~~ we maintain insurance in the geographic areas in which we operate, pollution, reservoir damage and environmental risks generally are not fully insurable. Our insurance policies may not adequately cover our losses or may have exclusions of coverage for some losses. We do not have insurance coverage or rights to indemnity for all risks, including loss of hire insurance on most of the rigs in our fleet. Uninsured exposures may include expatriate activities prohibited by U.S. laws and regulations, radiation hazards, certain loss or damage to property onboard our rigs and losses relating to shore-based terrorist acts or strikes. If a significant accident or other event occurs and is not fully covered by insurance or contractual indemnity, it could adversely affect our financial position, results of operations or cash flows. 15

~~Failure~~citizens toof, ~~attract~~or ~~and~~purchase ~~retain~~supplies ~~highly~~from, ~~skilled~~a ~~personnel~~particular orjurisdiction. anThese ~~increase~~practices inmay ~~personnel~~adversely ~~costs could~~affect ~~hurt~~our ability to compete and our results of operations.

WeOperating ~~require highly skilled personnel to operate~~ and ~~provide~~maintenance ~~technical~~costs ~~services~~of ~~and support for~~ our ~~drilling~~rigs ~~units.~~may Asbe ~~the~~significant ~~demand for drilling services~~ and ~~the~~may ~~size~~not ofcorrespond ~~the worldwide industry fleet increases, shortages of qualified personnel have occurred from time~~ to ~~time.~~revenue These shortages could result in our loss of qualified personnel to competitors, impair our ability to attract and retain qualified personnel for our new or existing drilling units, impair the timeliness and quality of our work and create upward pressure on personnel costs, any of which could adversely affect our operationsearned.

~~Fluctuations~~Our operating expenses and maintenance costs depend on a variety of factors including: crew costs, costs of provisions, equipment, insurance, maintenance and repairs, and shipyard costs, many of which are beyond our control. Our total operating costs are generally related to the number of drilling rigs in ~~exchange~~operation ~~rates~~and the cost level in each country or region where such drilling rigs are located. Equipment maintenance costs fluctuate depending upon the type of activity that the drilling rig is performing and ~~nonconvertibility~~the age and condition of ~~currencies~~the ~~could~~equipment. Operating and maintenance costs will not necessarily fluctuate in proportion to changes in operating revenues. While operating revenues may fluctuate as a function of changes in dayrate, costs for operating a rig may not be proportional to the dayrate received and may vary based on a variety of factors, including the scope and length of required rig preparations and the duration of the contractual period over which such expenditures are amortized. Any investments in our rigs may not result in ~~losses~~an increased dayrate for or income from such rigs. A disproportionate amount of operating and maintenance costs in comparison to usdayrates could have a material adverse effect on our business, financial condition and results of operations.

WeDrilling ~~may~~contracts ~~experience~~with ~~currency~~national ~~exchange~~oil ~~losses~~companies ~~where revenues are received or expenses are paid in nonconvertible currencies or where we do not hedge an exposure to a foreign currency. We~~ may ~~also~~expose ~~incur~~us ~~losses as a result of an inability~~ to ~~collect~~greater ~~revenues~~risks ~~because~~than ofwe anormally ~~shortage~~assume ofin ~~convertible~~drilling ~~currency~~contracts ~~available~~with tonon-governmental ~~the country of operation, controls over currency exchange or controls over the repatriation of income or capital~~clients.

WeContracts with national oil companies are ~~subject~~often non-negotiable and may expose us to ~~litigation~~greater commercial, political and operational risks than we assume in other contracts, such as exposure to materially greater environmental liability and other claims for damages (including consequential damages) and personal injury related to our operations, or the risk that ~~could~~the contract may be terminated by our client without cause on short-term notice, contractually or by governmental action, under certain conditions that may not provide us an early termination payment, collection risks and political risks. In addition, our ability to resolve disputes or enforce contractual provisions may be negatively impacted with these contracts. While we believe that the financial, commercial and risk allocation terms of these contracts and our operating safeguards mitigate these risks, we can provide no assurance that the increased risk exposure will not have an adverse ~~effect~~impact on ~~us.~~our future operations or that we will not increase the number of rigs contracted to national oil companies with commensurate additional contractual risks.

WeGovernmental ~~are,~~laws ~~from~~and ~~time to time~~regulations, ~~involved~~including inenvironmental ~~various~~laws ~~litigation matters. These matters may include, among other things, contract disputes, personal injury claims, asbestos~~ and ~~other toxic tort claims~~regulations, ~~environmental~~may ~~claims~~add orto ~~proceedings,~~our ~~employment matters~~costs, ~~governmental~~result ~~claims for taxes or duties, and other litigation that arises~~ in ~~the ordinary course of our business. Although we intend to defend these matters vigorously~~delays, ~~we cannot predict with certainty the outcome~~ or ~~effect~~limit ofour ~~any~~drilling ~~claim or other litigation matter, and there can be no assurance as to the ultimate outcome of any litigation~~activity. ~~Litigation may have an adverse effect on us because of potential negative outcomes, costs of attorneys, the allocation of management’s time and attention, and other factors.~~

~~Forward-Looking~~Our ~~Statements~~business is affected by public policy and laws and regulations relating to the energy industry and the environment in the geographic areas where we operate.

~~This~~The ~~report~~drilling onindustry ~~Form~~is ~~10-K~~dependent ~~includes “forward-looking~~on ~~statements”~~demand ~~within~~for ~~the~~services ~~meaning~~from ~~of Section 27A of~~ the ~~U.S.~~oil ~~Securities~~and ~~Act~~gas ofexploration ~~1933,~~and asproduction ~~amended~~industry, and ~~Section 21E~~accordingly, ofwe ~~the~~are ~~U.S.~~directly ~~Securities~~affected ~~Exchange~~by ~~Act~~the adoption of ~~1934,~~laws asand ~~amended.~~regulations ~~All~~that ~~statements~~for ~~other~~economic, ~~than~~environmental ~~statements~~or ~~of historical~~other ~~facts~~policy ~~included~~reasons incurtail ~~this~~exploration ~~report~~and ~~regarding~~development ~~the~~drilling ~~Frontier~~for ~~transaction~~oil and ~~integration,~~gas. ~~contract~~We ~~backlog,~~may ~~fleet~~be ~~status,~~required ~~our~~to ~~financial~~make ~~position,~~significant ~~business~~capital ~~strategy,~~expenditures ~~timing~~to orcomply ~~results~~with ofgovernmental ~~acquisitions~~laws ~~or dispositions, backlog, completion~~ and ~~acceptance~~ ofregulations. ~~our~~Governments ~~newbuild~~in ~~rigs,~~some ~~contract~~foreign ~~commitments,~~countries ~~dayrates,~~are ~~contract~~increasingly ~~commencements,~~active ~~extension~~in orregulating ~~renewals,~~and ~~contract~~controlling ~~tenders,~~ the ~~outcome~~ownership of ~~any dispute~~concessions, ~~litigation~~the orexploration ~~investigation,~~for ~~plans~~oil and ~~objectives of management for future operations~~gas, ~~foreign~~ ~~currency requirements, results of joint ventures, indemnity~~ and other ~~contract~~aspects ~~claims, construction~~ of ~~rigs,~~the ~~industry~~oil ~~conditions~~and ~~including~~gas ~~the~~industries. ~~effect~~There ofis ~~disruptions~~increasing ofattention ~~drilling~~ in the ~~U.S.~~United ~~Gulf~~States ofand ~~Mexico,~~worldwide ~~access~~concerning tothe ~~financing,~~issue ~~impact~~ of ~~competition,~~ ~~governmental~~climate ~~regulations~~change and ~~permitting,~~the ~~availability~~effect of ~~labor,~~greenhouse ~~worldwide economic conditions~~gases, ~~taxes~~or ~~and~~GHGs. ~~tax~~This ~~rates,~~increased ~~indebtedness~~attention ~~covenant~~may ~~compliance,~~result ~~and~~in ~~timing~~new ~~for~~environmental ~~compliance~~laws ~~with~~or ~~any~~regulations ~~new~~that ~~regulations~~may ~~are~~unfavorably ~~forward-looking~~impact ~~statements. When~~us, ~~used~~our insuppliers ~~this~~and our customers.

16Our operations are also subject to numerous laws and regulations controlling the discharge of materials into the environment or otherwise relating to the protection of the environment. The modification of existing laws or regulations or the adoption of new laws or regulations that result in the curtailment of exploratory or developmental drilling for oil and gas could materially and adversely affect our operations by limiting drilling opportunities increasing our cost of doing business, discouraging our customers from drilling for hydrocarbons, disrupting revenue through permitting or similar delays, or subjecting us to liability. For example, we, as an operator of mobile offshore drilling units in navigable U.S. waters and certain offshore areas, including the U.S. Outer Continental Shelf, are liable for damages and for the cost of removing oil spills for which we may be held responsible, subject to certain limitations. Our operations may involve the use or handling of materials that are classified as environmentally hazardous. Laws and regulations protecting the environment have generally become more stringent and in certain circumstances impose “strict liability,” rendering a person liable for environmental damage without regard to negligence or fault. Environmental laws and regulations may expose us to liability for the conduct of or conditions caused by others or for acts that were in compliance with all applicable laws at the time they were performed.

~~Table~~As disclosed in Part II, Item 8, “Financial Statements and Supplementary Data, Note 17 — Commitments and Contingencies,” in November 2012, the U.S. Coast Guard in Alaska conducted an inspection and investigation of ~~Contents~~the Noble Discoverer and the Kulluk, a rig we were providing contract labor services for, and referred the matters to the DOJ for further investigation. In December 2014, a subsidiary reached a settlement with the DOJ regarding its investigation of the Noble Discoverer and the Kulluk. Under the terms of the plea agreement, the subsidiary pled guilty to violations relating to maintaining proper oil

~~report,~~ the words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “project,” “should” and similar expressions are intended to be among the statements that identify 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 be correct. These factors include those described in “Risk Factors” above, or in our other SEC filings, among others. Such 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. You should consider these risks when you are evaluating us. 16

~~Item~~record 1Bbooks for the Noble Discoverer and Kulluk, maintaining proper ballast records for the Noble Discoverer and notification of hazardous conditions with respect to the Noble Discoverer. ~~Unresolved~~The ~~Staff~~subsidiary ~~Comments~~paid $8.2 million in fines and $4 million in community service payments and implemented a comprehensive environmental compliance plan. Under the plea agreement, we were also placed on probation for four years. If during the term of probation, the subsidiary fails to adhere to the terms of the plea agreement, the DOJ may withdraw from the plea agreement and would be free to prosecute the subsidiary on all charges arising out of its investigation, including any charges dismissed pursuant to the terms of the plea agreement, as well as potentially other charges.

~~None.~~Any violation of anti-bribery or anti-corruption laws, including the Foreign Corrupt Practices Act, the United Kingdom Bribery Act, or similar laws and regulations could result in significant expenses, divert management attention, and otherwise have a negative impact on us.

~~Item~~We 2operate in countries known to have a reputation for corruption. ~~Properties~~We are subject to the risk that we, our affiliated entities or their respective officers, directors, employees and agents may take action determined to be in violation of such anti-corruption laws, including the U.S. Foreign Corrupt Practices Act of 1977, or FCPA, the United Kingdom Bribery Act 2010, or U.K. Bribery Act, and similar laws in other countries. Any violation of the FCPA, the U.K. Bribery Act or other applicable anti-corruption laws could result in substantial fines, sanctions, civil and/or criminal penalties and curtailment of operations in certain jurisdictions and might adversely affect our business, results of operations or financial condition. In addition, actual or alleged violations could damage our reputation and ability to do business. Further, detecting, investigating and resolving actual or alleged violations is expensive and can consume significant time and attention of our senior management.

~~Drilling~~Changes ~~Fleet~~ in, compliance with, or our failure to comply with the certain laws and regulations may negatively impact our operations and could have a material adverse effect on our results of operations.

Our ~~drilling~~operations ~~fleet~~are issubject ~~composed~~to ofvarious ~~the~~laws ~~following types of units: semisubmersibles, drillships, jackups~~ and ~~submersibles. Each~~regulations ~~type~~in ofcountries ~~drilling~~in rig is described further below. We also own one floating production storage and offloading unit (“FPSO”). Several factors determine the type of unit most suitable for a particular job, the most significant of which ~~include~~ ~~the~~we ~~water depth and the environment of the intended drilling location~~operate, ~~whether~~including ~~the~~laws ~~drilling is being done over a platform or other structure,~~ and ~~the~~regulations ~~intended~~relating ~~well depth.~~ to:

~~Semisubmersibles~~• the importing, exporting, equipping and operation of drilling rigs;

~~Semisubmersibles~~• ~~are~~currency ~~floating~~exchange 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 computer controlled dynamic positioning system and can drill in many areas where jackups cannot drill. However, semisubmersibles normally require water depth of at least 200 feet in order to conduct operations. Certain of our semisubmersibles are capable of drilling in water depths of up to 12,000 feet. controls;

~~The~~• ~~semisubmersible~~oil ~~fleet~~and ~~consists~~gas ofexploration ~~14 units,~~and ~~including:~~ development;

• ~~five~~taxation ~~Noble~~of ~~EVA-4000™~~offshore ~~semisubmersibles~~earnings and earnings of expatriate personnel; and

• ~~three~~use ~~Friede~~and &compensation ~~Goldman~~of ~~9500~~local ~~Enhanced~~employees ~~Pacesetter~~and ~~semisubmersibles;~~suppliers by foreign contractors.

•Public ~~two~~and ~~Pentagone~~regulatory 85scrutiny ~~semisubmersibles;~~of the energy industry has resulted in increased regulations being either proposed or implemented. In addition, existing regulations might be revised or reinterpreted, new laws, regulations and permitting requirements might be adopted or become applicable to us, our rigs, our customers, our vendors or our service providers, and future changes in laws and regulations could significantly increase our costs and could have a material adverse effect on our business, financial condition and results of operations. In addition, we may be required to post additional surety bonds to secure performance, tax, customs and other obligations relating to our rigs in jurisdictions where bonding requirements are already in effect and in other jurisdictions where we may operate in the future. These requirements would increase the cost of operating in these countries, which could materially adversely affect our business, financial condition and results of operations.

•In ~~two~~response ~~Bingo~~to ~~9000~~the ~~design~~Macondo ~~unit~~well ~~semisubmersibles;~~blowout incident in April 2010, the U.S. Department of Interior, through the Bureau of Ocean Energy Management (“BOEM”) and the Bureau of Safety and Environmental Enforcement (“BSEE”), began an overhaul of the offshore oil and natural gas regulatory process that significantly impacted oil and gas development regulated by the United States. From time to time, new rules, regulations and requirements have been proposed and implemented by BOEM, BSEE or the United States Congress that could materially limit or prohibit, and increase the cost of, offshore drilling. For example, in July 2016, BOEM and BSEE finalized a rule revising and adding requirements for drilling on the U.S. Arctic Outer Continental Shelf. Similarly, in April 2016, BSEE announced a final blowout preventer systems and well control rule. BOEM also released a new Notice to Lessees and Operators in the Outer Continental Shelf in September 2016 that updates offshore bonding requirements. This update eliminates waivers of supplemental bonding and prohibits a company from relying on the financial strength of co-lessees unless co-lessees agree to allocate BOEM-determined self-insurance to the lease. These new bonding requirements may increase our customers’ operating costs and impact our customers’ ability to obtain leases, thereby, reducing demand for our services. We are also subject to increasing regulatory requirements and scrutiny in the North Sea jurisdictions and other countries. These new rules, regulations and requirements, including the adoption of new safety requirements and policies relating to the approval of drilling permits, restrictions on oil and gas development and production activities in the U.S. Gulf of Mexico and elsewhere, implementation of safety and environmental management systems, mandatory third party compliance audits, and the promulgation of numerous Notices to Lessees or similar new regulatory requirements outside of the U.S., have impacted and may continue to impact our operations by causing increased costs, delays and operational restrictions. In addition to these rules, regulations and requirements, the U.S. federal government is considering new legislation that could impose additional equipment and safety requirements on operators and drilling contractors in the U.S., as well as regulations relating to the protection of the environment. If the new regulations, policies, operating procedures and possibility of increased legal liability resulting from the adoption or amendment of rules and regulations applicable to our operations in the U.S. or other jurisdictions are viewed by our

• ~~one Aker H-3 Twin Hull S1289 Column semisubmersible; and~~17

•current ~~one~~or ~~Offshore~~future ~~Co.~~customers ~~SCP~~as ~~III~~a ~~Mark~~significant 2impairment ~~semisubmersible~~to expected profitability on projects, then they could discontinue or curtail their offshore operations in the impacted region, thereby adversely affecting our operations by limiting drilling opportunities or imposing materially increased costs.

~~Drillships~~Adverse effects may continue as a result of the uncertainty of ongoing inquiries, investigations and court proceedings, or additional inquiries and proceedings by federal or state regulatory agencies or private plaintiffs. In addition, we cannot predict the outcome of any of these inquiries or whether these inquiries will lead to additional legal proceedings against us, civil or criminal fines or penalties, or other regulatory action, including legislation or increased permitting requirements. Legal proceedings or other matters against us, including environmental matters, suits, regulatory appeals, challenges to our permits by citizen groups and similar matters, might result in adverse decisions against us. The result of such adverse decisions, both individually or in the aggregate, could be material and may not be covered fully or at all by insurance.

~~Our~~Operational ~~drillships~~interruptions ~~are~~or ~~self-propelled~~maintenance ~~vessels.~~or ~~These~~repair ~~units~~work ~~maintain their~~may ~~position~~cause ~~over~~our ~~the~~customers ~~well~~to ~~through~~suspend ~~the use of either a fixed mooring system~~ or areduce ~~computer~~payment ~~controlled~~of ~~dynamic~~dayrates ~~positioning~~until ~~system.~~operation ~~Our~~of ~~drillships~~the ~~are~~respective ~~capable of~~ drilling inrig ~~water~~is ~~depths from 1~~resumed,~~000~~ towhich ~~12,000~~may ~~feet.~~lead ~~The~~to ~~maximum~~loss ~~drilling depth~~ of ~~our drillships~~revenue ~~ranges~~or ~~from~~termination ~~20,000~~or ~~feet~~renegotiation toof ~~40,000~~the ~~feet.~~drilling contract.

~~The~~If ~~drillship~~our ~~fleet~~drilling ~~consists~~rigs are idle for reasons that are not related to the ability of 14the ~~units~~rig to operate, our customers are entitled to pay a waiting, or standby, rate lower than the full operational rate. In addition, if our drilling rigs are taken out of service for maintenance and repair for a period of time exceeding the scheduled maintenance periods set forth in our drilling contracts, we will not be entitled to payment of dayrates until the rig is able to work. Several factors could cause operational interruptions, including:

• ~~four~~breakdowns ~~dynamically positioned, ultra-deepwater, harsh environment drillships currently under construction, the first~~ of ~~which~~equipment isand ~~estimated~~other tounforeseen beengineering ~~delivered from the shipyard in the second quarter of 2013~~problems;

• ~~three~~work ~~dynamically~~stoppages, ~~positioned~~including ~~Gusto~~labor ~~Engineering Pelican Class drillships~~strikes;

• ~~two~~shortages ~~dynamically~~of ~~positioned~~material ~~Bully-class~~and ~~drillships~~skilled ~~operated by us through a 50 percent joint venture with a subsidiary of Shell~~labor;

• ~~one~~delays ~~dynamically~~in ~~positioned~~repairs ~~Globetrotter-class~~by ~~drillship~~suppliers;

• ~~one~~surveys ~~dynamically~~by ~~positioned~~government ~~Globetrotter-class~~and ~~drillship~~maritime ~~currently under construction, which is scheduled to be delivered to our customer in the fourth quarter of 2013~~authorities;

• ~~one~~periodic ~~conventionally~~classification ~~moored Sonat Discoverer Class drillship capable of drilling in Arctic environments~~surveys;

• ~~one~~inability ~~dynamically~~to ~~positioned~~obtain ~~NAM Nedlloyd-C drillship~~permits; ~~and~~

• ~~one~~severe ~~conventionally~~weather, ~~moored~~strong ~~conversion~~ocean ~~class~~currents ~~drillship.~~or harsh operating conditions; and

17• force majeure events.

~~Table~~If the interruption of ~~Contents~~operations were to exceed a determined period due to an event of force majeure, our customers have the right to pay a rate that is significantly lower than the waiting rate for a period of time, and, thereafter, may terminate the drilling contracts related to the subject rig. Suspension of drilling contract payments, prolonged payment of reduced rates or termination of any drilling contract as a result of an interruption of operations as described herein could materially adversely affect our business, financial condition and results of operations.

~~Jackups~~As a result of our significant cash flow needs, we may be required to incur additional indebtedness, and in the event of lost market access, may have to delay or cancel discretionary capital expenditures.

WeOur ~~currently~~cash ~~have~~flow 49needs, ~~jackups~~both in our fleet, including six high-specification, heavy duty, harsh environment jackups currently under construction. Jackups are mobile, self-elevating drilling platforms equipped with legs that can be lowered to the ocean floor until a foundation is established for support. 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 jackups are independent leg (i.e., the legs can be raised or lowered independently of each other) and cantilevered. 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 preshort-~~existing~~term ~~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~~long-term, ~~and~~may ~~drilling~~include ~~operations are conducted with~~ the ~~hull in its raised position. Our jackups are capable of drilling to a maximum depth of 30,000 feet in water depths up to 400 feet.~~ following:

~~Submersibles~~ • normal recurring operating expenses;

We• ~~have~~planned ~~two submersibles in the fleet which are currently cold-stacked. Submersibles are mobile drilling platforms that are towed to the drill site~~ and ~~submerged~~discretionary tocapital 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 up to 70 feet. expenditures;

18• repayment of debt and interest; and

~~Table~~• payments of ~~Contents~~dividends.

~~Drilling~~In ~~Fleet~~the ~~Table~~future, we may require funding for capital expenditures that is beyond the amount available to us from cash generated by our operations, cash on hand and borrowings under our existing bank credit facility. We may raise such additional capital in a number of ways, including accessing capital markets, obtaining additional lines of credit or disposing of assets. However, we can provide no assurance that any of these options will be available to us on terms acceptable to us or at all.

~~The~~Our ~~following~~debt ~~table~~instruments ~~sets~~could ~~forth~~limit ~~certain~~our ~~information~~operations ~~concerning~~and our ~~offshore~~debt ~~fleet~~level atmay ~~February 7,~~limit ~~2013~~our flexibility to obtain financing and pursue business opportunities. ~~The~~Our ~~table~~ability ~~does~~to ~~not~~obtain ~~include~~financing ~~any~~or ~~units~~to ~~owned~~access bythe ~~operators~~capital ~~for~~markets ~~which~~may webe ~~had~~limited ~~labor~~by ~~contracts.~~our ~~We operate~~financial condition and ~~own~~our ~~all~~credit ofratings at the ~~units~~time ~~included~~of inany such financing and the ~~table~~covenants in our existing debt agreements, as well as by adverse market conditions resulting from, among other things, a depressed oil price, general economic conditions and uncertainties that are beyond our control. Even if we are successful in obtaining additional capital through debt financings, incurring additional indebtedness may significantly increase our interest expense and may reduce our flexibility to respond to changing business and economic conditions or to fund working capital needs, because we will require additional funds to service our outstanding indebtedness.

Water

Drilling

Depth

Year Built

Rating

Capacity

Name

Make

or Rebuilt (1)

(feet)

Location

Status (2)

Semisubmersibles—14

Noble Amos Runner

Noble EVA-4000™

1999 R/2008 M

8,000

32,500

U.S. Gulf of Mexico

Active

Noble Clyde Boudreaux

F&G 9500 Enhanced Pacesetter

2007 R/M

10,000

35,000

Australia

Active

Noble Danny Adkins

Bingo 9000—DP

2009R

12,000

35,000

U.S. Gulf of Mexico

Active

Noble Dave Beard

F&G 9500 Enhanced Pacesetter—DP

2009 R

10,000

35,000

Brazil

Active

Noble Driller

Aker H-3 Twin Hull S1289 Column

2007 R

5,000

30,000

U.S. Gulf of Mexico

Active

Noble Homer Ferrington

F&G 9500 Enhanced Pacesetter

2004 R

7,200

30,000

Israel

Active

Noble Jim Day

Bingo 9000—DP

2010 R

12,000

35,000

U.S. Gulf of Mexico

Active

Noble Jim Thompson

Noble EVA-4000™

1999 R/2006 M

6,000

32,500

U.S. Gulf of Mexico

Active

Noble Lorris Bouzigard

Pentagone 85

2003 R

4,000

25,000

U.S. Gulf of Mexico

Stacked

Noble Max Smith

Noble EVA-4000™

1999 R

7,000

30,000

Brazil

Active

Noble Paul Romano

Noble EVA-4000™

1998 R/2007 M

6,000

32,500

Malta

Active

Noble Paul Wolff

Noble EVA-4000™—DP

2006 R

9,200

30,000

Brazil

Active

Noble Therald Martin

Pentagone 85

2004 R

4,000

25,000

Brazil

Active

Noble Ton van Langeveld (3)

Offshore Co. SCP III Mark 2

2000 R

1,500

25,000

U.K.

Active

Drillships—14

Noble Bob Douglas

Hyundai Gusto P 10000

2013 N

12,000

40,000

South Korea

Shipyard

Noble Bully I (3)(5)

GustoMSC Bully PRD 12000

2011 N

8,200

40,000

U.S. Gulf of Mexico

Active

Noble Bully II (3)(5)

GustoMSC Bully PRD 12000

2011 N

8,200

40,000

Brazil

Active

Noble Discoverer (3)

Sonat Discoverer Class

2009 R

1,000

20,000

Alaska

Active

Noble Don Taylor

Hyundai Gusto P 10000

2013 N

12,000

40,000

South Korea

Shipyard

Noble Duchess

Conversion

2012 R

1,500

25,000

India

Active

Noble Globetrotter I (3)

Globetrotter Class

2011 N

10,000

30,000

U.S. Gulf of Mexico

Active

Noble Globetrotter II (3)

Globetrotter Class

2013 N

10,000

30,000

The Netherlands

Shipyard

Noble Leo Segerius

Gusto Engineering Pelican Class

2012 R

5,600

20,000

Brazil

Active

Noble Muravlenko

Gusto Engineering Pelican Class

1997 R

4,900

20,000

U.S. Gulf of Mexico

Stacked

Noble Phoenix

Gusto Engineering Pelican Class

2009 R

5,000

25,000

Brazil

Active

Noble Roger Eason

NAM Nedlloyd—C

2013 R

7,200

25,000

Brazil

Active

Noble Sam Croft

Hyundai Gusto P 10000

2014 N

12,000

40,000

South Korea

Shipyard

Noble Newbuild Drillship #4 (3)

Hyundai Gusto P 10000

2014 N

12,000

40,000

South Korea

Shipyard

Independent Leg Cantilevered Jackups—49 (Continued to next page)

Dhabi II

Baker Marine BMC 150

2006 R

150

20,000

U.A.E.

Active

Noble Al White (3)

CFEM T-2005-C

2005 R

360

30,000

The Netherlands

Active

Noble Alan Hay

Levingston Class 111-C

2005 R

300

25,000

U.A.E.

Active

Noble Bill Jennings

MLT Class 84—E.R.C.

1997 R

390

25,000

Mexico

Active

Noble Byron Welliver (3)

CFEM T-2005-C

1982

300

30,000

U.K.

Active

Noble Carl Norberg

MLT Class 82-C

2003 R

250

20,000

Mexico

Active

Noble Charles Copeland

MLT Class 82-SD-C

2001 R

280

20,000

Saudi Arabia

Active

Noble Charlie Yester

MLT Class 116-C

1980

300

25,000

India

Active

Noble Chuck Syring

MLT Class 82-C

1996 R

250

20,000

Qatar

Active

Noble David Tinsley

Modec 300C-38

2010 R

300

25,000

U.A.E.

Active

Noble Dick Favor

Baker Marine BMC 150

2004 R

150

20,000

U.A.E.

Active

Noble Don Walker

Baker Marine BMC 150-SD

1992R

150

20,000

Cameroon

Stacked

Noble Earl Frederickson

MLT Class 82-SD-C

1999 R

250

20,000

Mexico

Active

Noble Ed Holt

Levingston Class 111-C

2003 R

300

25,000

India

Active

Noble Ed Noble

MLT Class 82-SD-C

2003 R

250

20,000

Nigeria

Active

Noble Eddie Paul

MLT Class 84—E.R.C.

1995 R

390

25,000

Mexico

Active

Noble Gene House

Modec 300C-38

1998 R

300

25,000

Saudi Arabia

Active

Noble Gene Rosser

Levingston Class 111-C

1996 R

300

25,000

Mexico

Active

Noble George McLeod

F&G L-780 MOD II

1995 R

300

25,000

U.A.E.

Active

Noble George Sauvageau (3)

NAM Nedlloyd-C

1981

250

25,000

Denmark

Active

Noble Gus Androes

Levingston Class 111-C

2004 R

300

30,000

Qatar

Active

Noble Hans Deul (3)

F&G JU-2000E

2009 N

400

30,000

U.K

Active

~~See~~We ~~footnotes~~may ondelay or cancel discretionary capital expenditures, which could have certain adverse consequences, including delaying upgrades or equipment purchases that could make the ~~following~~affected ~~page.~~rigs less competitive, adversely affect customer relationships and negatively impact our ability to contract such rigs.

19We may have difficulty obtaining or maintaining insurance in the future and our insurance coverage and contractual indemnity rights may not protect us against all of the risks and hazards we face.

~~Table~~We do not procure insurance coverage for all of ~~Contents~~the potential risks and hazards we may face. Furthermore, no assurance can be given that we will be able to obtain insurance against all of the risks and hazards we face or that we will be able to obtain or maintain adequate insurance at rates and with deductibles or retention amounts that we consider commercially reasonable.

Water

Drilling

Depth

Year Built

Rating

Capacity

Name

Make

or Rebuilt (1)

(feet)

Location

Status (2)

Independent Leg Cantilevered Jackups—49 (Continued from previous page)

Noble Harvey Duhaney

Levingston Class 111-C

2001 R

300

25,000

Qatar

Active

Noble Houston Colbert (3)

F&G JU-3000N

2013 N

400

30,000

Singapore

Shipyard

Noble Jimmy Puckett

F&G L-780 MOD II

2002 R

300

25,000

Qatar

Active

Noble Joe Beall

Modec 300C-38

2004 R

300

25,000

Saudi Arabia

Active

Noble John Sandifer

Levingston Class 111-C

1995 R

300

25,000

Mexico

Active

Noble Johnnie Hoffman

Baker Marine BMC 300

1993 R

300

25,000

Mexico

Active

Noble Julie Robertson (3) (4)

BMC 300 Harsh Weather Class

2001 R

390

25,000

U.K.

Active

Noble Kenneth Delaney

F&G L-780 MOD II

1998 R

300

25,000

India

Active

Noble Leonard Jones

MLT Class 53—E.R.C.

1998 R

390

25,000

Mexico

Active

Noble Lewis Dugger

Levingston Class 111-C

1997 R

300

25,000

Mexico

Active

Noble Lloyd Noble

MLT Class 82-SD-C

1990 R

250

20,000

Cameroon

Active

Noble Lynda Bossler (3)

MSC/CJ-46

1982

250

25,000

The Netherlands

Active

Noble Mick O’Brien (3)

F&G JU-3000N

2013 N

400

30,000

Singapore

Shipyard

Noble Percy Johns

F&G L-780 MOD II

1995 R

300

25,000

Nigeria

Active

Noble Piet van Ede (3)

MSC/CJ-46

1982

250

25,000

The Netherlands

Active

Noble Regina Allen (3)

F&G JU-3000N

2013 N

400

30,000

Singapore

Shipyard

Noble Roger Lewis

F&G JU-2000E

2007

400

30,000

Saudi Arabia

Active

Noble Ronald Hoope (3)

MSC/CJ-46

1982

250

25,000

The Netherlands

Active

Noble Roy Butler

F&G L-780 MOD II

1998 R

300

25,000

Mexico

Active

Noble Roy Rhodes

MLT Class 116-C

2009 R

300

25,000

Oman

Active

Noble Sam Noble

Levingston Class 111-C

1982

300

25,000

Mexico

Active

Noble Sam Turner (3)

F&G JU-3000N

2014 N

400

30,000

Singapore

Shipyard

Noble Scott Marks (3)

F&G JU-2000E

2009 N

400

30,000

Saudi Arabia

Active

Noble Tom Jobe

MLT Class 82-SD-C

1982

250

25,000

Mexico

Active

Noble Tom Prosser (3)

F&G JU-3000N

2014 N

400

30,000

Singapore

Shipyard

Noble Tommy Craighead

F&G L-780 MOD II

2003 R

300

25,000

Gabon

Active

Noble Newbuild Jackup #6 (3)

F&G JU-3000N

2014 N

400

30,000

Singapore

Shipyard

Submersibles—2

Noble Joe Alford

Pace Marine 85G

2006 R

25,000

U.S. Gulf of Mexico

Stacked

Noble Lester Pettus

Pace Marine 85G

2007 R

25,000

U.S. Gulf of Mexico

Stacked

FPSO- 1

Seillean

Harland & Wolf Shipbuilding

2008 R

N/A

U.S. Gulf of Mexico

Stacked

Our insurance carriers may interpret our insurance policies such that they do not cover losses for which we make claims. Our insurance policies may also have exclusions of coverage for some losses. Uninsured exposures may include expatriate activities prohibited by U.S. laws, radiation hazards, certain loss or damage to property onboard our rigs and losses relating to shore-based terrorist acts or strikes. Furthermore, the damage sustained to offshore oil and gas assets in the U.S. as a result of hurricanes has negatively impacted certain aspects of the energy insurance market, resulting in more restrictive and expensive coverage for U.S. named windstorm perils due to the price or lack of availability of coverage. Accordingly, we have in the past self-insured the rigs in the U.S. Gulf of Mexico for named windstorm perils. We currently have U.S. windstorm coverage for most of our U.S. fleet subject to limit, but will continue to monitor the insurance market conditions in the future and may decide not to, or be unable to, purchase named windstorm coverage for some or all of the rigs operating in the U.S. Gulf of Mexico.

~~Footnotes~~Under our drilling contracts, liability with respect to ~~Drilling~~personnel ~~Fleet~~and ~~Table~~property is customarily assigned on a “knock-for-knock” basis, which means that we and our customers assume liability for our respective personnel and property, irrespective of the fault or negligence of the party indemnified. Although our drilling contracts generally provide for indemnification from our customers for certain liabilities, including liabilities resulting from pollution or contamination originating below the surface of the water, enforcement of these contractual rights to indemnity may be limited by public policy and other considerations and, in any event, may not adequately cover our losses from such incidents. There can also be no assurance that those parties with contractual obligations to indemnify us will necessarily be in a financial position to do so.

1.Although ~~Rigs~~we ~~designated~~maintain ~~with~~insurance anin ~~“R”~~the ~~were~~geographic ~~modified~~areas in which we operate, ~~refurbished~~pollution, reservoir damage and environmental risks generally are not fully insurable. Our insurance policies may not adequately cover our losses or ~~otherwise~~may ~~upgraded~~have inexclusions ~~the~~of ~~year~~coverage ~~indicated~~for bysome ~~capital~~losses. ~~expenditures~~We indo annot ~~amount~~have ~~deemed~~insurance ~~material~~coverage byor ~~management~~rights to indemnity for all risks, including loss of hire insurance on most of the rigs in our fleet. ~~Rigs~~Uninsured ~~designated~~exposures ~~with~~may aninclude ~~“N”~~expatriate ~~are~~activities ~~newbuilds~~prohibited by U.S. ~~Rigs~~laws ~~designated~~and ~~with~~regulations, anradiation ~~“M”~~hazards, ~~have~~cyber ~~been~~risks, ~~upgraded~~certain loss or damage to ~~the~~property ~~Noble~~onboard NCour rigs and losses relating to shore-~~5SM~~based ~~mooring~~terrorist ~~standard~~acts or strikes. If a significant accident or other event occurs and is not fully covered by insurance or contractual indemnity, it could adversely affect our business, financial condition and results of operations.

2.A ~~Rigs~~loss ~~listed~~of asa ~~“active”~~major ~~were~~tax ~~either~~dispute ~~operating~~or ~~under~~a ~~contract~~successful ortax ~~were~~challenge ~~actively~~to ~~seeking~~our ~~contracts;~~operating ~~rigs~~structure, ~~listed~~intercompany aspricing ~~“shipyard”~~policies ~~are~~or the taxable presence of our subsidiaries in acertain ~~shipyard~~countries ~~for~~could ~~construction,~~result ~~repair,~~in ~~refurbishment~~a orhigher ~~upgrade;~~tax ~~rigs~~rate ~~listed~~on asour ~~“stacked”~~worldwide ~~are~~earnings, ~~idle~~which ~~without~~could result in a ~~contract~~material ~~and~~adverse ~~are~~effect ~~not~~on ~~actively~~our ~~marketed~~financial incondition ~~present~~and ~~market~~results ~~conditions~~of operations.

3Income tax returns that we file will be subject to review and examination. ~~Harsh~~We ~~environment~~will ~~capability~~not recognize the benefit of income tax positions we believe are more likely than not to be disallowed upon challenge by a tax authority. If any tax authority successfully challenges our operational structure, intercompany pricing policies or the taxable presence of our subsidiaries in certain countries, if the terms of certain income tax treaties are interpreted in a manner that is adverse to our structure, or if we lose a material tax dispute in any country, our effective tax rate on our worldwide earnings could increase substantially and result in a material adverse effect on our financial condition.

4.Our ~~Although~~consolidated ~~designed~~effective ~~for~~income atax ~~water~~rate ~~depth~~may ~~rating~~vary ofsubstantially ~~390~~from ~~feet~~one ofreporting ~~water~~period ~~in a non-harsh environment, the rig is currently equipped with legs adequate~~ to ~~drill in approximately 200 feet of water in a harsh environment~~another. ~~We own the additional leg sections required to extend the drilling depth capability to 390 feet of water.~~

5We cannot provide any assurances as to what our consolidated effective income tax rate will be because of, among other matters, uncertainty regarding the nature and extent of our business activities in any particular jurisdiction in the future and the tax laws of such jurisdictions, as well as potential changes in U.K., WeU.S. ~~own~~and other foreign tax laws, regulations or treaties or the interpretation or enforcement thereof, changes in the administrative practices and ~~operate~~precedents of tax authorities or any reclassification or other matter (such as changes in applicable accounting rules) that increases the ~~Noble~~amounts ~~Bully~~we Ihave provided for income taxes or deferred tax assets and ~~Noble~~liabilities ~~Bully~~in IIour ~~through~~consolidated ~~joint~~financial ~~ventures~~statements. ~~with~~In addition, as a ~~subsidiary~~result of ~~Shell.~~frequent ~~Under~~changes in the ~~terms~~taxing ofjurisdictions in which our drilling rigs are operated and/or owned, changes in the ~~joint~~overall ~~venture~~level ~~agreements~~of our income and changes in tax laws, ~~each~~our ~~party~~consolidated ~~has~~effective anincome ~~equal~~tax 50rate ~~percent~~may ~~ownership~~vary ~~stake~~substantially from one reporting period to another. Income tax rates imposed in ~~both~~the ~~vessels~~tax jurisdictions in which our subsidiaries conduct operations vary, as does the tax base to which the rates are applied. In some cases, tax rates may be applicable to gross revenues, statutory or negotiated deemed profits or other bases utilized under local tax laws, rather than to net income. Our drilling rigs frequently move from one taxing jurisdiction to another to perform contract drilling services. In some instances, the movement of drilling rigs among taxing jurisdictions will involve the transfer of

20 19

~~Table~~ownership of ~~Contents~~the drilling rigs among our subsidiaries. If we are unable to mitigate the negative consequences of any change in law, audit, business activity or other matter, this could cause our consolidated effective income tax rate to increase and cause a material adverse effect on our financial position, operating results and/or cash flows.

~~Facilities~~Our operations are subject to numerous laws and regulations relating to the protection of the environment and of human health and safety, and compliance with these laws and regulations could impose significant costs and liabilities that exceed our current expectations.

~~Our~~Substantial ~~corporate~~costs, ~~headquarters~~liabilities, isdelays ~~located~~and inother ~~Baar,~~significant ~~Switzerland,~~issues ~~and~~could wearise ~~maintain~~from ~~offices~~environmental, ~~for~~health ~~executive~~and ~~officers~~safety laws and ~~selected~~regulations ~~personnel~~covering inour ~~Geneva~~operations, ~~Switzerland.~~and Wewe ~~also~~may ~~maintain~~incur ~~office~~substantial ~~space~~costs inand ~~Sugar~~liabilities ~~Land, Texas,~~in ~~where~~maintaining ~~significant~~compliance ~~worldwide~~with ~~global~~such ~~support~~laws ~~activity~~and ~~occurs~~regulations. InOur ~~addition,~~operations weare ~~own~~subject ~~and~~to ~~lease~~extensive ~~administrative~~international conventions and ~~marketing offices~~treaties, and ~~sites~~national ~~used~~or ~~primarily~~federal, ~~for~~state ~~storage,~~and ~~maintenance~~local laws and ~~repairs~~regulations, ~~and~~governing ~~research~~environmental ~~and~~protection, ~~development~~including ~~for~~with ~~drilling~~respect ~~rigs~~to the discharge of materials into the environment and ~~equipment~~ inthe ~~various~~security ~~locations~~of ~~worldwide~~chemical and industrial facilities. These laws govern a wide range of environmental issues, including:

~~Item~~• 3.the ~~Legal~~release ~~Proceedings.~~of oil, drilling fluids, natural gas or other materials into the environment;

~~Information~~• ~~regarding~~air ~~legal~~emissions ~~proceedings~~from isour ~~set~~drilling ~~forth~~rigs inor ~~Note 16 to~~ our ~~consolidated financial statements included in Item 8 of this Annual Report on Form 10-K.~~ facilities;

~~Item~~• 4.handling, ~~Mine~~cleanup ~~Safety~~and ~~Disclosures.~~remediation of solid and hazardous wastes at our drilling rigs or our facilities or at locations to which we have sent wastes for disposal;

~~Not~~• ~~applicable.~~restrictions on chemicals and other hazardous substances; and

~~PART~~• IIwildlife protection, including regulations that ensure our activities do not jeopardize endangered or threatened animals, fish and plant species, nor destroy or modify the critical habitat of such species.

~~Item~~Various 5governmental authorities have the power to enforce compliance with these laws and regulations and the permits issued under them, oftentimes requiring difficult and costly actions. ~~Market~~Failure ~~for~~to ~~Registrant’s~~comply ~~Common~~with ~~Equity~~these laws, ~~Related~~regulations ~~Stockholder~~and ~~Matters~~permits, or the release of oil or other materials into the environment, may result in the assessment of administrative, civil and ~~Issuer~~criminal ~~Purchases~~penalties, the imposition of ~~Equity~~remedial ~~Securities~~obligations, the imposition of stricter conditions on or revocation of permits, the issuance of moratoria or injunctions limiting or preventing some or all of our operations, delays in granting permits and cancellation of leases, or could affect our relationship with certain consumers.

~~Market~~There is an inherent risk of the incurrence of environmental costs and liabilities in our business, some of which may be material, due to the handling of our customers’ hydrocarbon products as they are gathered, transported, processed and stored, air emissions related to our operations, historical industry operations, and water and waste disposal practices. Joint, several or strict liability may be incurred without regard to fault under certain environmental laws and regulations for ~~Shares~~the remediation of contaminated areas and ~~Related~~in ~~Shareholder~~connection ~~Information~~with past, present or future spills or releases of natural gas, oil and wastes on, under, or from past, present or future facilities. Private parties may have the right to pursue legal actions to enforce compliance as well as to seek damages for non-compliance with environmental laws and regulations or for personal injury or property damage arising from our operations. In addition, increasingly strict laws, regulations and enforcement policies could materially increase our compliance costs and the cost of any remediation that may become necessary. Our insurance may not cover all environmental risks and costs or may not provide sufficient coverage if an environmental claim is made against us.

~~Noble-Swiss~~Our ~~shares~~business ~~are~~may ~~listed~~be ~~and~~adversely ~~traded~~affected onby ~~the~~increased ~~New~~costs ~~York~~due ~~Stock~~to ~~Exchange~~stricter ~~under~~pollution ~~the~~control ~~symbol~~equipment ~~“NE”~~requirements or liabilities resulting from non-compliance with required operating or other regulatory permits. ~~The~~Also, ~~following~~we ~~table~~might ~~sets~~not ~~forth~~be able to obtain or maintain from time to time all required environmental regulatory approvals for ~~the~~our ~~periods~~operations. ~~indicated~~If ~~the~~there ~~high~~is ~~and~~a ~~low~~delay ~~sales~~in ~~prices~~obtaining any required environmental regulatory approvals, or if we fail to obtain and ~~dividends~~ comply with them, the operation or ~~returns~~construction of ~~capital~~our ~~declared~~facilities ~~and~~could ~~paid~~be inprevented Uor become subject to additional costs.S. ~~Dollars~~In ~~per~~addition, ~~share:~~the steps we could be required to take to bring certain facilities into regulatory compliance could be prohibitively expensive, and we might be required to shut down, divest or alter the operation of those facilities, which might cause us to incur losses.

					Dividends
					Declared and
	High		Low		Paid
2012
Fourth quarter	$	39.81	$	33.51	$	0.13
Third quarter		38.60		32.21		0.13
Second quarter		38.82		29.13		0.14
First quarter		41.25		30.29		0.14
2011
Fourth quarter	$	38.42	$	28.58	$	0.14
Third quarter		39.70		27.68		0.17
Second quarter		46.10		37.51		0.15
First quarter		46.12		35.64		0.14

We make assumptions and develop expectations about possible expenditures related to environmental conditions based on current laws and regulations and current interpretations of those laws and regulations. If the interpretation of laws or regulations, or the laws and regulations themselves, change, our assumptions may change, and new capital costs may be incurred to comply with such changes. In addition, new environmental laws and regulations might adversely affect our operations, as well as waste management and air emissions. For instance, governmental agencies could impose additional safety requirements, which could affect our profitability. Further, new environmental laws and regulations might adversely affect our customers, which in turn could affect our profitability.

~~The~~Finally, ~~declaration~~although ~~and~~some ~~payment~~ of ~~dividends~~our ordrilling ~~returns~~rigs ofwill ~~capital~~be ~~require~~separately ~~authorization~~owned ofby ~~the~~our ~~shareholders~~ subsidiaries, under certain circumstances a parent company and all of ~~Noble~~the unit-~~Swiss.~~owning ~~The~~affiliates ~~amount~~in ofa ~~such~~group ~~dividends,~~under ~~distributions~~common ~~and~~control ~~returns~~engaged ofin ~~capital~~a ~~will~~joint ~~depend~~venture oncould ~~our~~be ~~results~~held liable for damages or debts owed by one of ~~operations~~the affiliates, ~~financial~~including ~~condition,~~liabilities ~~cash~~for ~~requirements,~~oil ~~future~~spills ~~business~~under ~~prospects~~environmental laws. Therefore, ~~contractual~~it ~~restrictions~~is ~~and~~possible ~~other~~that ~~factors~~we ~~deemed relevant~~could bybe ~~our~~subject ~~Board~~to ofliability ~~Directors~~upon ~~and~~a judgment against us or any one of our ~~shareholders~~subsidiaries.

On ~~February 11, 2013, there were 253,225,668 shares outstanding held by 794 shareholder accounts of record.~~ 20

~~Swiss~~Refurbishment, ~~Tax~~conversion ~~Consequences~~or upgrades of rigs are subject to ~~Shareholders~~risks, ofincluding ~~Noble-Swiss~~delays and cost overruns, which could have an adverse impact on our available cash resources and results of operations.

~~The~~We ~~tax~~will ~~consequences~~continue ~~discussed~~to ~~below~~make ~~are~~upgrades, ~~not~~refurbishment aand ~~complete~~repair ~~analysis~~expenditures orto ~~listing~~our offleet ~~all~~from ~~the~~time ~~possible~~to ~~tax~~time, ~~consequences~~some ~~that~~of which may be ~~relevant~~unplanned. ~~to shareholders~~Our ofcustomers ~~Noble.~~may ~~Shareholders~~also ~~should~~require ~~consult~~certain ~~their~~shipyard ~~own~~reliability ~~tax~~upgrade ~~advisors~~projects infor ~~respect~~our ofrigs. ~~the~~These ~~tax~~projects ~~consequences~~and ~~related~~other toefforts ~~receipt,~~of ~~ownership,~~this ~~purchase~~type orare ~~sale~~subject orto ~~other~~risks ~~disposition~~ of ~~our~~cost ~~shares~~overruns ~~and~~or ~~the~~delays ~~procedures~~inherent ~~for~~in ~~claiming~~any large construction project as a ~~refund~~result of ~~withholding tax.~~numerous factors, including the following:

21• shortages of equipment, materials or skilled labor;

~~Table~~• ofwork ~~Contents~~stoppages and labor disputes;

~~Swiss~~• ~~Income~~unscheduled ~~Tax~~delays onin ~~Dividends~~the ~~and~~delivery ~~Similar~~of ~~Distributions~~ordered materials and equipment;

A• ~~non-Swiss~~local ~~holder~~customs ~~will~~strikes ~~not~~or berelated ~~subject~~work toslowdowns ~~Swiss~~that ~~income~~could ~~taxes~~delay onimportation ~~dividend income and similar distributions in respect~~ of ~~our~~equipment ~~shares, unless the shares are attributable to a permanent establishment~~ or a fixed place of business maintained in Switzerland by such non-Swiss holder. However, dividends and similar distributions are subject to Swiss withholding tax. See “—Swiss Withholding Tax–Dividends to Shareholders.” materials;

~~Swiss~~• ~~Wealth~~weather ~~Tax~~ interferences;

A• ~~non-Swiss~~difficulties ~~holder~~in ~~will~~obtaining ~~not~~necessary bepermits ~~subject~~or toapprovals ~~Swiss wealth taxes unless the holder’s shares are attributable to a permanent establishment~~ or ~~a fixed place of business maintained~~ in ~~Switzerland~~meeting bypermit ~~such~~or ~~non-Swiss~~approval ~~holder.~~ conditions;

~~Swiss~~• ~~Capital~~design ~~Gains~~and ~~Tax~~engineering ~~upon Disposal of Shares~~ problems;

A• ~~non-Swiss~~inadequate ~~holder~~regulatory ~~will~~support ~~not~~infrastructure ~~be subject to Swiss income taxes for capital gains unless the holder’s shares are attributable to a permanent establishment or a fixed place of business maintained~~ in ~~Switzerland by such non-Swiss holder. In such case,~~ the ~~non-Swiss~~local ~~holder is required to recognize capital gains or losses on the sale of such shares, which will be subject to cantonal, communal and federal income tax.~~ jurisdiction;

~~Swiss~~• ~~Withholding~~latent ~~Tax—Dividends~~damages or deterioration to ~~Shareholders~~hull, equipment and machinery in excess of engineering estimates and assumptions;

A• ~~Swiss~~unforeseen ~~withholding~~increases ~~tax~~in ~~of 35 percent is due on dividends to our shareholders from us, regardless of~~ the ~~place~~cost of ~~residency~~equipment, oflabor ~~the shareholder (subject to the exceptions discussed under “—Exemption from Swiss Withholding Tax–Distributions to Shareholders” below). We will be required to withhold at such rate~~ and ~~remit~~raw onmaterials, aparticularly net basis any payments made to a holder of our shares and pay such withheld amounts to the Swiss federal tax authorities. Please see “—Refund of Swiss Withholding Tax on Dividends and Other Distributions.” steel;

~~Exemption~~• ~~from~~unanticipated ~~Swiss~~actual ~~Withholding~~or ~~Tax—Distributions~~purported tochange ~~Shareholders~~ orders;

~~Under~~• ~~present~~client ~~Swiss~~acceptance tax law, distributions to shareholders in relation to a reduction of par value are exempt from Swiss withholding tax. Since January 1, 2011, distributions to shareholders out of qualifying additional paid-in capital for Swiss statutory purposes are exempt from the Swiss withholding tax. Consequently, we expect that a substantial amount of any potential future distributions, whether distributed as a reduction of par value or directly out of qualifying additional paid-in capital may be exempt from Swiss withholding tax. delays;

~~Repurchases~~• ofdisputes ~~Shares~~ with shipyards and suppliers;

~~Under~~• ~~present~~delays ~~Swiss tax law~~in, ~~repurchases~~or ofinability ~~shares for the purposes of capital reduction are treated as a partial liquidation subject~~ to ~~the 35 percent Swiss withholding tax. However~~obtain, ~~for~~access ~~shares repurchased for capital reduction, the portion of the repurchase price attributable~~ to the par value of the shares repurchased will not be subject to the Swiss withholding tax. Since January 1, 2011, the portion of the repurchase price attributable to the qualifying additional paid-in capital for Swiss statutory reporting purposes of the shares repurchased will also not be subject to the Swiss withholding tax. We would be required to withhold at such rate the tax from the difference between the repurchase price and the related amount of par value and the related amount of qualifying additional paid-in capital. We would be required to remit on a net basis the purchase price with the Swiss withholding tax deducted to a holder of our shares and pay the withholding tax to the Swiss federal tax authorities. funding;

~~With~~• ~~respect~~shipyard toavailability, ~~the~~failures ~~refund~~and ofdifficulties, ~~Swiss~~including ~~withholding~~as ~~tax~~a ~~from~~result ~~the repurchase~~ of ~~shares,~~financial ~~see~~problems ~~“—Refund~~ of ~~Swiss~~shipyards ~~Withholding~~or ~~Tax~~their onsubcontractors; ~~Dividends~~ and ~~Other Distributions.”~~

In• ~~most~~failure ~~instances,~~or Swiss companies listed on the SIX Swiss Exchange (“SIX”), carry out share repurchase programs through a “second trading line” on the SIX. Swiss institutional investors typically purchase shares from shareholders on the open market and then sell the shares on the second trading line back to the company. The Swiss institutional investors are generally able to receive a full refund of the withholding tax. Due to, among other things, the time delay ~~between the sale to the company and the institutional investors’ receipt~~ of ~~the~~third-party ~~refund,~~equipment ~~the~~vendors ~~price~~or ~~companies~~service ~~pay to repurchase their shares has historically been slightly higher (but less than 1 percent) than the price of such companies’ shares in ordinary trading on the SIX first trading line~~providers.

22The failure to complete a rig repair, upgrade, refurbishment or new construction on time, or at all, or the inability to complete a rig conversion or new construction in accordance with its design specifications, may result in loss of revenues, penalties, or delay, renegotiation or cancellation of a drilling contract or the recognition of an asset impairment. Additionally, capital expenditures for rig repair, upgrade, refurbishment and construction projects could materially exceed our planned capital expenditures. Moreover, when our rigs are undergoing upgrade, refurbishment and repair, they may not earn a dayrate during the period they are out of service. If we experience substantial delays and cost overruns in our shipyard projects, it could have a material adverse effect on our business, financial condition and results of operations. We currently have no new rigs under construction.

~~Table~~Acts of ~~Contents~~terrorism, piracy and political and social unrest could affect the markets for drilling services, which may have a material adverse effect on our results of operations.

WeActs doof ~~not~~terrorism ~~expect~~and tosocial beunrest, ~~able~~brought toabout ~~use~~by ~~the~~world ~~SIX~~political ~~second~~events ~~trading~~or ~~line~~otherwise, ~~process~~have tocaused ~~repurchase~~instability ~~our shares~~in ~~because~~the weworld’s dofinancial ~~not~~and ~~currently~~insurance ~~intend~~markets toin ~~list~~the ~~our~~past ~~shares~~and onmay occur in the ~~SIX~~future. ~~However,~~Such weacts ~~have~~could inbe ~~the~~directed ~~past~~against ~~and~~companies ~~intend~~such toas ~~continue~~ours. toIn ~~follow~~addition, anacts ~~alternative~~of ~~process~~terrorism, ~~whereby~~piracy weand ~~expect~~social tounrest becould ~~able~~lead to ~~repurchase~~increased ~~our~~volatility ~~shares~~ in aprices ~~manner~~for ~~that~~crude ~~should~~oil ~~allow~~and ~~Swiss institutional~~natural ~~market~~gas ~~participants~~and ~~selling~~could affect the ~~shares~~markets tofor usdrilling toservices. ~~receive~~Insurance apremiums ~~refund~~could ofincrease ~~the~~and ~~Swiss~~coverage ~~withholding~~may ~~tax~~be ~~and,~~unavailable ~~therefore,~~in ~~accomplish~~ the ~~same~~future. ~~purpose~~Government asregulations ~~share~~may ~~repurchases~~effectively onpreclude ~~the~~us ~~second~~from ~~trading~~engaging ~~line~~in atbusiness ~~substantially~~activities ~~the~~in ~~same~~certain ~~cost~~countries. These regulations could be amended to uscover ~~and~~countries ~~such market~~where ~~participants~~we ascurrently ~~share~~operate ~~repurchases~~or onwhere awe ~~second~~may ~~trading~~wish ~~line.~~to operate in the future.

~~The~~Our ~~repurchase~~drilling ofcontracts ~~shares~~do ~~for~~not ~~purposes~~generally ~~other~~provide ~~than~~indemnification against loss of capital ~~reduction~~ assets or loss of revenues resulting from acts of terrorism, ~~such~~piracy asor topolitical ~~retain~~or associal ~~treasury~~unrest. ~~shares~~We have limited insurance for ~~use~~our inassets ~~connection~~providing ~~with~~coverage ~~stock~~for ~~incentive~~physical ~~plans~~damage losses resulting from risks, ~~convertible~~such ~~debt~~as orterrorist ~~other~~acts, ~~instruments~~piracy, ~~within~~vandalism, ~~certain~~sabotage, ~~periods~~civil unrest, ~~will~~expropriation ~~generally~~and acts of war, and we do not becarry ~~subject~~insurance tofor ~~Swiss~~loss ~~withholding~~of ~~tax.~~revenues resulting from such risks.

~~Refund~~Our information technology systems and those of ~~Swiss~~our ~~Withholding~~service ~~Tax~~providers onare ~~Dividends~~subject ~~and~~to ~~Other~~cybersecurity ~~Distributions~~risks and threats.

~~Swiss~~We ~~holders~~depend –on Ainformation ~~Swiss~~technology ~~tax~~systems ~~resident~~that we manage, ~~corporate~~and orothers ~~individual,~~that ~~can~~are ~~recover~~managed ~~the~~by ~~withholding~~our ~~tax~~third-party inservice ~~full~~and ifequipment ~~such~~providers, ~~resident~~to isconduct ~~the beneficial~~our ~~owner~~operations, ofincluding critical systems on our ~~shares~~drilling atunits, ~~the~~and ~~time~~these ~~the~~systems ~~dividend~~are subject to risks associated with cyber incidents or attacks. It has been reported that unknown entities or groups have mounted cyber-attacks on businesses and other ~~distribution~~organizations ~~becomes~~solely ~~due~~to disable or disrupt computer systems, disrupt operations and, ~~provided~~in ~~that~~some ~~such~~cases, ~~resident~~steal ~~reports~~data. Due to the ~~gross~~nature ~~distribution~~of ~~received~~cyber-attacks, onbreaches ~~such~~to ~~resident~~our or our service or equipment providers’s ~~income~~systems ~~tax~~could ~~return~~go unnoticed for a prolonged period of time. These cybersecurity risks could disrupt our operations and result in downtime, loss of revenue, or the loss of critical data as well as result in higher costs to correct and remedy the ~~case~~effects of such incidents. If our or our service or equipment providers’ systems for protecting against cyber incidents or attacks prove to be insufficient and an ~~entity~~incident were to occur, ~~includes~~it ~~the taxable~~could ~~income~~have ina ~~such~~material ~~resident’s~~adverse ~~income~~effect ~~statement~~on our business, financial condition, results of operations or cash flows. Currently, we do not carry insurance for losses related to cybersecurity attacks, and may elect to not obtain such insurance in the future.

~~Non-Swiss~~ holders – If the shareholder that receives a distribution from us is not a Swiss tax resident, does not hold our shares in connection with a permanent establishment or a fixed place of business maintained in Switzerland, and resides in a country that has concluded a treaty for the avoidance of double taxation with Switzerland for which the conditions for the application and protection of and by the treaty are met, then the shareholder may be entitled to a full or partial refund of the withholding tax described above. The procedures for claiming treaty refunds (and the time frame required for obtaining a refund) may differ from country to country. 21

~~Switzerland has~~Failure ~~entered into bilateral treaties for the avoidance of double taxation with respect~~ to ~~income~~attract ~~taxes~~and ~~with~~retain ~~numerous~~skilled ~~countries,~~personnel ~~including~~or ~~the~~an ~~U.S.,~~increase ~~whereby~~in ~~under~~personnel ~~certain~~costs ~~circumstances~~could ~~all~~adversely oraffect ~~part~~our ~~of the withholding tax may be refunded~~operations.

~~U.S.~~We ~~residents~~require –skilled ~~The~~personnel ~~Swiss-U.S.~~to ~~tax~~operate ~~treaty~~and ~~provides~~provide ~~that~~technical ~~U.S.~~services ~~residents~~and ~~eligible~~support for ~~benefits~~our ~~under~~drilling units. In the ~~treaty~~past, ~~can~~during ~~seek~~periods ~~a refund~~of high demand for drilling services and increasing worldwide industry fleet size, shortages of ~~the~~qualified ~~Swiss~~personnel ~~withholding~~have ~~tax~~occurred. onDuring ~~dividends~~periods ~~for~~of low demand, such as the ~~portion~~one ~~exceeding~~we 15are ~~percent~~currently ~~(leading~~experiencing, tothere aare ~~refund~~layoffs of 20qualified ~~percent)~~personnel, who often find work with competitors or leave the industry. As a ~~full~~result, ~~refund~~once inmarket ~~the~~conditions ~~case~~improve, we may face shortages of qualified ~~pension~~personnel, ~~funds.~~which would impair our ability to attract qualified personnel for our new or existing drilling units, impair the timeliness and quality of our work and create upward pressure on personnel costs, any of which could adversely affect our operations.

AsUnionization aefforts ~~general~~and ~~rule,~~labor ~~the~~regulations ~~refund~~in ~~will~~certain becountries ~~granted~~in ~~under~~which ~~the~~we ~~treaty~~operate ifcould ~~the~~materially ~~U.S.~~increase ~~resident~~our ~~can~~costs ~~show~~or ~~evidence~~limit ~~of:~~our flexibility.

•Certain ~~beneficial~~of ~~ownership~~our employees and contractors in international markets are represented by labor unions or work under collective bargaining or similar agreements, which are subject to periodic renegotiation. Efforts may be made from time to time to unionize portions of our workforce. In addition, we may be subject to strikes or work stoppages and other labor disruptions in the future. Additional unionization efforts, new collective bargaining agreements or work stoppages could materially increase our costs, reduce our revenues or limit our operational flexibility.

•Any ~~U.S.~~failure ~~residency,~~to comply with the complex laws and regulations governing international trade could adversely affect our operations.

•The ~~meeting~~shipment of goods, services and technology across international borders subjects our business to extensive trade laws and regulations. Import activities are governed by unique customs laws and regulations in each of the countries of operation. Moreover, many countries, including the United States, control the export and re-export of certain goods, services and technology and impose related export recordkeeping and reporting obligations. Governments also may impose economic sanctions against certain countries, persons and other entities that may restrict or prohibit transactions involving such countries, persons and entities. U.S.~~-Swiss~~ ~~tax~~sanctions, ~~treaty’s~~in ~~limitation~~particular, onare ~~benefits~~targeted ~~requirements~~against certain countries that are heavily involved in the petroleum and petrochemical industries, which includes drilling activities.

The ~~claim~~laws ~~for~~and ~~refund~~regulations ~~must~~concerning beimport ~~filed~~activity, ~~with~~export ~~the~~recordkeeping ~~Swiss~~and ~~federal~~reporting, ~~tax~~export ~~authorities~~control ~~(Eigerstrasse~~and ~~65,~~economic ~~3003~~sanctions ~~Berne,~~are ~~Switzerland),~~complex noand ~~later~~constantly ~~than December 31~~changing. ofThese ~~the~~laws ~~third~~and ~~year~~regulations ~~following~~may ~~the~~be ~~year~~enacted, amended, enforced or interpreted in ~~which~~a ~~the~~manner ~~dividend~~materially ~~payments~~impacting ~~became~~our ~~due~~operations. ~~The~~Shipments ~~relevant~~can ~~Swiss~~be ~~tax~~delayed ~~form~~and isdenied ~~Form~~export ~~82C~~or entry for ~~companies,~~a ~~82E~~variety ~~for~~of ~~other~~reasons, ~~entities~~some ~~and~~of ~~82I~~which ~~for~~are ~~individuals.~~outside ~~These~~our ~~forms~~control ~~can~~and besome ~~obtained~~of ~~from~~which ~~any~~may ~~Swiss Consulate~~result ~~General~~from infailure ~~the~~to ~~U.S.~~comply orwith ~~from~~existing ~~the~~legal ~~Swiss~~and ~~federal~~regulatory ~~tax~~regimes. ~~authorities~~Shipping atdelays ~~the~~or ~~address~~denials ~~mentioned~~could ~~above~~cause orunscheduled atoperational ~~www~~downtime.~~estv.admin.ch.~~ ~~Each~~Any ~~form~~failure ~~needs~~ to becomply ~~filled~~with ~~out~~applicable inlegal ~~triplicate,~~and ~~with~~regulatory ~~each~~trading ~~copy~~obligations ~~duly~~could ~~completed~~also result in criminal and ~~signed~~civil ~~before~~penalties aand ~~notary~~sanctions, ~~public~~such ~~in the~~as ~~U.S.~~fines, ~~Evidence~~imprisonment, ~~that~~debarment ~~the~~from ~~withholding~~government ~~tax~~contracts, ~~was~~seizure ~~withheld~~of atshipments ~~the~~and ~~source~~loss ~~must~~of ~~also~~import beand ~~included.~~export privileges.

~~Stamp~~Currently, ~~duties~~we do not, nor do we intend to, operate in ~~relation~~countries that are subject to ~~the~~ ~~transfer~~significant ofsanctions ~~shares~~and –embargoes ~~The~~imposed ~~purchase~~by the U.S. government or ~~sale~~identified by the U.S. government as state sponsors of ~~our~~terrorism, ~~shares~~such ~~may~~as beCuba, ~~subject~~Iran, toSudan ~~Swiss~~and ~~federal~~Syria. ~~stamp~~The ~~taxes~~U.S. onsanctions ~~the~~and ~~transfer~~embargo oflaws ~~securities~~and ~~irrespective~~regulations ofvary ~~the~~in ~~place~~their ofapplication, ~~residency~~as ofthey ~~the~~do ~~purchaser~~not orall ~~seller~~apply ifto the ~~transaction~~same ~~takes~~covered ~~place~~persons ~~through~~ or ~~with~~proscribe athe ~~Swiss~~same ~~bank~~activities, and such sanctions and embargo laws and regulations may be amended or ~~other~~strengthened ~~Swiss~~over ~~securities~~time. ~~dealer,~~Although aswe ~~those~~believe ~~terms~~that ~~are~~we ~~defined~~will be in ~~the~~compliance ~~Swiss~~with ~~Federal~~all ~~Stamp~~applicable ~~Tax~~sanctions ~~Act~~and embargo laws and regulations at the filing date, and intend to maintain such compliance, there can be no ~~exemption~~assurance ~~applies~~that we will be in compliance in the ~~specific~~future, ~~case~~particularly as the scope of certain laws may be unclear and may be subject to changing interpretations. IfAny asuch ~~purchase~~violation could result in fines or ~~sale~~other ispenalties ~~not~~and ~~entered~~could ~~into~~result ~~through~~in some investors deciding, or ~~with~~being arequired, ~~Swiss~~to ~~bank~~divest their interest, or ~~other~~not ~~Swiss securities~~to ~~dealer~~invest, ~~then~~in nous. ~~stamp~~In ~~tax~~addition, ~~will~~certain beinstitutional ~~due.~~investors ~~The~~may ~~applicable~~have ~~stamp~~investment ~~tax~~policies ~~rate~~or isrestrictions ~~0.075~~that ~~percent~~prevent ~~for~~them ~~each~~from holding securities of companies that have contracts with countries identified by the ~~two~~U.S. ~~parties~~government toas astate ~~transaction~~sponsors ~~and~~of isterrorism. ~~calculated~~In ~~based~~addition, onour reputation and the ~~purchase~~market ~~price~~for our securities may be adversely affected if we engage in certain other activities, such as entering into drilling contracts with individuals or ~~sale~~entities ~~proceeds~~in countries subject to significant U.S. Ifsanctions ~~the~~and ~~transaction~~embargo ~~does~~laws that are not ~~involve~~controlled ~~cash consideration,~~by the ~~transfer~~governments ~~stamp~~of ~~duty~~those iscountries, ~~computed~~or onengaging ~~the~~in ~~basis~~operations ofassociated ~~the~~with ~~market~~those ~~value~~countries ofpursuant ~~the~~to ~~consideration.~~contracts with third parties that are unrelated to those countries or entities controlled by their governments.

23Pension expenses associated with our retirement benefit plans may fluctuate significantly depending upon changes in actuarial assumptions, future investment performance of plan assets and legislative or other regulatory actions.

~~Table~~A portion of ~~Contents~~our current and retired employee population is covered by pension and other post-retirement benefit plans, the costs of which are dependent upon various assumptions, including estimates of rates of return on benefit plan assets, discount rates for future payment obligations, mortality assumptions, rates of future cost growth and trends for future costs. In addition, funding requirements for benefit obligations of our pension and other post-retirement benefit plans are subject to legislative and other government regulatory actions. Future changes in estimates and assumptions associated with our pension and other post-

~~Purchases~~ ~~of Shares~~ 22

~~The~~retirement ~~following~~benefit ~~table~~plans ~~sets~~could ~~forth~~have ~~for~~a ~~the~~material ~~periods~~adverse ~~indicated~~effect ~~certain~~on ~~information~~our ~~with~~financial ~~respect~~condition, toresults ~~repurchases~~of byoperations, ~~Noble-Swiss~~cash offlows ~~its~~and/or ~~shares:~~financial disclosures.

Period	Total Numberof SharesPurchased (2)		AveragePrice Paidper Share		Total Number ofShares Purchasedas Part of PubliclyAnnounced Plansor Programs		Maximum Numberof Shares that MayYet Be PurchasedUnder the Plansor Programs (1)
October 2012		189	$	38.09		—		6,769,891
November 2012		—	$	0.00		—		6,769,891
December 2012		2,200	$	34.28		—		6,769,891

Fluctuations in exchange rates and nonconvertibility of currencies could result in losses to us.

~~(1)~~We ~~All~~may ~~share~~experience ~~purchases~~currency ~~made~~exchange losses when revenues are received or expenses are paid in ~~the~~nonconvertible ~~open~~currencies, ~~market~~when ~~and~~we ~~were~~do ~~pursuant~~not hedge an exposure to a foreign currency or when the ~~share~~result ~~repurchase~~of ~~program~~a ~~which~~hedge ~~our~~is ~~Board~~a loss. We may also incur losses as a result of ~~Directors~~an ~~authorized~~inability ~~and~~to ~~adopted~~collect ~~and~~revenues ~~our~~due ~~shareholders~~to ~~approved.~~a ~~Our~~shortage ~~repurchase~~of ~~program~~convertible ~~has~~currency noavailable ~~date~~to the country of ~~expiration~~operation, controls over currency exchange or controls over the repatriation of income or capital.

~~(2)~~We ~~Amounts~~are ~~represent~~subject ~~shares~~to ~~surrendered~~litigation bythat ~~employees~~could ~~for~~have ~~withholding~~an ~~taxes~~adverse ~~payable~~effect ~~upon~~on ~~the vesting of restricted stock or exercise of stock options~~us.

~~Stock~~We ~~Performance~~are, ~~Graph~~from time to time, involved in various litigation matters. These matters may include, among other things, contract disputes, personal injury claims, asbestos and other toxic tort claims, environmental claims or proceedings, employment matters, governmental claims for taxes or duties, and other litigation that arises in the ordinary course of our business. Although we intend to defend these matters vigorously, we cannot predict with certainty the outcome or effect of any claim or other litigation matter, and there can be no assurance as to the ultimate outcome of any litigation. Litigation may have an adverse effect on us because of potential negative outcomes, costs of attorneys, the allocation of management’s time and attention, and other factors.

~~This~~We ~~graph~~are ~~shows~~a ~~the~~holding ~~cumulative~~company, ~~total~~and ~~shareholder~~we ~~return~~are ofdependent ~~our~~upon ~~shares~~cash ~~over~~flow ~~the five-year period~~ from ~~January 1,~~subsidiaries ~~2008~~ to ~~December 31,~~meet 2012. The graph also shows the cumulative total returns for the same five-year period of the S&P 500 Index and the Dow Jones U.S. Oil Equipment & Services Index. The graph assumes that $100 was invested in our ~~shares and the two indices on January 1, 2008 and that all dividends or distributions and returns of capital were reinvested on the date of payment~~obligations.

	INDEXED RETURNS
	Year Ended December 31,
Company Name / Index	2008		2009		2010		2011		2012
Noble Corporation	$	39.76	$	73.66	$	66.55	$	57.12	$	66.82
S&P 500 Index		63.00		79.67		91.68		93.61		108.59
Dow Jones U.S. Oil Equipment & Services		40.70		67.22		85.60		74.96		75.20

We currently conduct our operations through our subsidiaries, and our operating income and cash flow are generated by our subsidiaries. As a result, cash we obtain from our subsidiaries is the principal source of funds necessary to meet our debt service obligations. Contractual provisions or laws, as well as our subsidiaries’ financial condition and operating requirements, may limit our ability to obtain the cash that we require from our subsidiaries to pay our debt service obligations. Applicable tax laws may also subject such payments to us by our subsidiaries to further taxation.

24Forward-Looking Statements

~~Table~~This Annual Report on Form 10-K includes “forward-looking statements” within the meaning of ~~Contents~~Section 27A of the U.S. Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the U.S. Securities Exchange Act of 1934, as amended, (the "Exchange Act"). All statements other than statements of historical facts included in this report regarding rig demand, the offshore drilling market, oil prices, contract backlog, fleet status, our financial position, business strategy, impairments, repayment of debt, credit ratings, borrowings under our credit facilities or other instruments, sources of funds, future capital expenditures, contract commitments, dayrates, contract commencements, extension or renewals, contract tenders, the outcome of any dispute, litigation, audit or investigation, plans and objectives of management for future operations, foreign currency requirements, results of joint ventures, indemnity and other contract claims, industry conditions, access to financing, impact of competition, governmental regulations and permitting, availability of labor, worldwide economic conditions, taxes and tax rates, indebtedness covenant compliance, dividends and distributable reserves, timing or results of acquisitions or dispositions, and timing for compliance with any new regulations are forward-looking statements. When used in this report, the words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “project,” “should” and similar expressions are intended to be among the statements that identify 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 be correct. These factors include those described in “Risk Factors” above, or in our other SEC filings, among others. Such 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. You should consider these risks when you are evaluating us.

~~Investors~~Item ~~are~~1B. ~~cautioned~~Unresolved ~~against~~Staff ~~drawing any conclusions from the data contained in the graph, as past results are not necessarily indicative of future performance~~Comments.

The above graph and related information shall not be deemed “soliciting material” or to be “filed” with the SEC, nor shall such information be incorporated by reference into any future filing under the Securities Act of 1933 or Securities Exchange Act of 1934, each as amended, except to the extent that we specifically incorporate it by reference into such filingNone.

Item 62. ~~Selected Financial Data~~Properties.

~~The~~Drilling following table sets forth selected financial data of us and our consolidated subsidiaries over the five-year period ended December 31, 2012, which information is derived from our audited financial statements. This information should be read in connection with, and is qualified in its entirety by, the more detailed information in our financial statements included in Item 8 of this Annual Report on Form 10-K. Fleet

	Year Ended December 31,
	2012			2011			2010			2009			2008
	(In thousands, except per share amounts)
Statement of Income Data
Operating revenues	$	3,547,012		$	2,695,832		$	2,807,176		$	3,640,784		$	3,446,501
Net income attributable to Noble Corporation		522,344			370,898			773,429			1,678,642			1,560,995
Net income per share:
Basic		2.05			1.46			3.03			6.44			5.85
Diluted		2.05			1.46			3.02			6.42			5.81
Balance Sheet Data (at end of period)
Cash and marketable securities	$	282,092		$	239,196		$	337,871		$	735,493		$	513,311
Property and equipment, net		13,025,972			12,130,345			10,213,158			6,815,637			5,647,017
Total assets		14,607,774			13,495,159			11,302,387			8,396,896			7,106,799
Long-term debt		4,634,375			4,071,964			2,686,484			750,946			750,789
Total debt (1)		4,634,375			4,071,964			2,766,697			750,946			923,487
Total equity		8,488,290			8,097,852			7,287,634			6,788,432			5,290,715
Other Data
Net cash from operating activities	$	1,381,693		$	740,240		$	1,636,902		$	2,131,267		$	1,888,192
Net cash from investing activities		(1,790,888	)		(2,521,546	)		(2,896,469	)		(1,489,610	)		(1,129,293	)
Net cash from financing activities		452,091			1,682,631			861,945			(419,475	)		(406,646	)
Capital expenditures		1,669,811			2,621,235			1,406,010			1,426,049			1,231,321
Working capital		393,876			232,432			110,347			1,049,243			561,348
Cash dividends/par value reduction declared per share (2) (3)		0.54			0.60			0.88			0.18			0.91

Our drilling fleet is composed of the following types of units: drillships, semisubmersibles, and jackups. Each type of drilling rig is described further below. Several factors determine the type of unit most suitable for a particular job, the most significant of which include the water depth and the environment of the intended drilling location, whether the drilling is being done over a platform or other structure, and the intended well depth.

~~(1)~~ ~~Consists of Long-Term Debt and Current Maturities of Long-Term Debt.~~23

(2) From the third quarter of 2009 through the second quarter of 2012, we paid a return on capital in the form of par value reductions, in lieu of dividends, based upon an amount in Swiss Francs. In the third and fourth quarters of 2012, we paid a dividend from the capital contribution reserve. Amounts listed are in U.S. Dollars at the exchange rate that the dividend was paid.Drillships

~~(3)~~Our ~~The~~drillships ~~par~~are ~~value~~self-propelled ~~reductions~~vessels. orThese ~~cash~~units ~~dividends~~maintain ~~declared~~their inposition ~~2010~~over ~~and~~the ~~2008~~well ~~includes~~through the use of a ~~special~~computer-controlled ~~dividend~~dynamic positioning system. Certain of ~~approximately~~our ~~$0.56~~drillships ~~and~~are ~~$0.75~~capable ~~per~~of ~~share~~drilling in water depths up to 12,000 ~~respectively~~feet.

~~Item~~As 7.of ~~Management’s~~the ~~Discussion~~filing ~~and~~date ~~Analysis~~ of ~~Financial~~this ~~Condition~~Annual ~~and~~Report ~~Results~~on Form 10-K, our drillship fleet consisted of ~~Operations.~~the following eight units:

~~The~~• ~~following~~four ~~discussion~~dynamically ispositioned ~~intended~~Gusto toEngineering ~~assist~~Class you in understanding our financial position at December 31, 2012 and 2011, and our results of operations for each of the years in the three-year period ended December 31, 2012. You should read the accompanying consolidated financial statements and related notes in conjunction with this discussion. drillships;

25• two dynamically positioned Bully-class drillships operated by us through a 50 percent joint venture with a subsidiary of Shell; and

~~Table~~• oftwo ~~Contents~~dynamically positioned Globetrotter-class drillships.

~~Executive Overview~~ Semisubmersibles

~~Our~~Semisubmersibles ~~2012~~are ~~financial~~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 in order to improve stability. These units maintain their position over the well through the use of either a fixed mooring system or a computer controlled dynamic positioning system and ~~operating~~can ~~results~~drill ~~include:~~in many areas where jackups cannot drill. Semisubmersibles normally require water depths of at least 200 feet in order to conduct operations. Certain of our semisubmersibles are capable of drilling in water depths of up to 12,000 feet.

•As ~~operating~~of ~~revenues~~the ~~totaling~~filing ~~$3.5~~date ~~billion;~~of this Annual Report on Form 10-K, our semisubmersible fleet consisted of the following six units:

• ~~net~~two ~~income~~Noble ofEVA-4000™ ~~$522 million or $2.05 per diluted share~~semisubmersibles;

• ~~net~~two ~~cash~~modified ~~from~~Friede ~~operating~~& ~~activities~~Goldman ~~totaling~~9500 ~~$1.4~~Enhanced ~~billion~~Pacesetter semisubmersibles; and

• antwo ~~increase~~modified inBingo ~~debt~~9000 todesign ~~35.3 percent of total capitalization at the end of 2012~~unit, updynamically ~~from~~positioned 33semisubmersibles.5 percent at the end of 2011 due to the issuance of $1.2 billion in senior notes partially offset by a $635 million decrease in the amount of debt being drawn on our credit facilities and commercial paper program.

During 2012, we continued to see modest improvement in the offshore drilling market even as the underlying commodity markets were subject to short-term volatility. In the U.S. Gulf of Mexico, the granting of permits and publication of new safety rules during the latter half of 2011, has led to increased activity levels within the industry. The activity reflects the positive long-term outlook for commodity prices, which has led to increased activity by our customers and contributed to improved dayrates for deepwater and ultra-deepwater rigs worldwide, and excellent geologic success, which is leading to a backlog of appraisal and development projects. Jackups

~~There~~Jackups ~~continues~~are tomobile, self-elevating drilling platforms equipped with legs that can be ~~doubt~~lowered ~~regarding~~to the ~~sustainability~~ocean offloor until a foundation is established for support. The rig hull includes the ~~global~~drilling ~~economic~~rig, ~~recovery~~jacking system, ~~which~~crew isquarters, ~~proceeding~~loading ~~unevenly~~and inunloading ~~different geographic~~facilities, ~~regions~~storage areas for bulk and liquid materials, helicopter landing deck and other related equipment. ~~There~~All isof ~~also~~our ~~hesitation~~jackups ~~regarding~~are ~~recovery~~independent inleg (i.e., the ~~credit~~legs ~~markets,~~can ~~particularly~~be inraised ~~Europe,~~or ~~which~~lowered ~~some~~independently ~~analysts~~of ~~predict~~each ~~could~~other) and cantilevered. A cantilevered jackup has a feature that permits the drilling platform to be extended out from the ~~catalyst~~hull, ~~for~~allowing ait ~~worldwide~~to ~~recession~~perform drilling or workover operations over pre-existing platforms or structures. ~~Finally,~~ ~~political~~Moving ~~instability,~~a ~~especially~~rig into the ~~Middle East~~drill ~~and~~site ~~North~~involves ~~Africa,~~jacking ~~has~~up ~~further~~its ~~created~~legs ~~uncertainty~~until ~~within~~the hull is floating on the ~~marketplace~~surface of the water. ~~These~~ ~~factors~~The ~~may~~hull ~~continue~~is then towed to ~~impact~~the drill site by tugs and the ~~price~~legs are jacked down to the ocean floor. The jacking operation continues until the hull is raised out of ~~oil~~the water, and ~~gas~~drilling ~~commodities~~operations ~~for~~are conducted with the ~~foreseeable~~hull ~~future~~in its raised position. Our jackups are capable of drilling in maximum water depths from approximately 300-500 feet. As of the filing date of this Annual Report on Form 10-K, ~~and~~we had 14 jackups in ~~turn~~our fleet, ~~could~~including ~~impact~~one ~~the~~high-specification, ~~offshore~~harsh ~~drilling~~environment ~~market~~jackup.

~~Despite~~ the instability in the global economy and commodity prices noted above, the market for offshore drilling services has continued the upward trend that began during the second half of 2011. We believe both the short-term and long-term outlook for the deep and ultra-deepwater markets continues to strengthen. Market dayrates for new ultra-deepwater units consistently remained above $500,000 throughout the year, which is higher than rates seen in recent years. A number of fixtures have exceeded $550,000, and in certain cases even exceeded $600,000. Our market analysis indicates that there is little, if any, availability of ultra-deepwater units for 2013. In addition, availability of ultra-deepwater units in 2014 continues to decrease. Utilization rates for jackups stabilized in 2011, and improved in most regions during 2012. We have seen tangible market activity and anticipate a favorable environment for these rigs in the short-term. We continue to see differentiation in the jackup market, with newer units having utilization rates and dayrates exceeding those for units that entered service before 2000. We continue to see improvement in the older jack-up market with increased utilization and competitive dayrates for these rigs as well, with most regions experiencing market utilization of 90 percent or higher. 24

AsOffshore ~~part~~Fleet of our strategic planning process, we review our fleet and the strategic benefits of our drilling rigs. As part of this process, we continuously analyze the potential divestment of certain of our standard specification units and related assets in one or more transactions. These dispositions may include sales of assets to third parties, a spin-off or other distribution or separation of assets or a combination of such transactions. In analyzing our disposition alternatives, we consider the strategic benefit to our ongoing operations while seeking to secure what we consider appropriate value for our shareholders. While we could continue to operate some or all standard specification drilling rigs, we have taken certain preliminary steps to put ourselves in a better position to pursue a potential spin-off and/or sale should we decide to do so. These include analyzing the internal restructuring steps necessary for a potential spin-off or sale and related tax considerations, seeking certain preparatory tax rulings and commencing preparation of financial statements for a potential separate group that could be spun off or sold. We have not completed the preliminary work to effect, nor has our board approved, any such transactions. We make no assurance that we will ultimately undertake any sales or spin-off or separation transactions involving standard specification assets. Table

26The following table sets forth certain information concerning our offshore fleet at February 23, 2017. We operate and own all of the units included in the table.

Name

Make

Year Built

or Rebuilt (1)

Water

Depth

Rating

(feet)

Drilling

Depth

Capacity

(feet)

Location

Status (2)

Drillships—8

Noble Bob Douglas

GustoMSC P10000

2013 N

12,000

40,000

U.S. Gulf of Mexico

Active

Noble Bully I (4)

GustoMSC Bully PRD 12000

2011 N

8,200

40,000

U.S. Gulf of Mexico

Active

Noble Bully II (4)

GustoMSC Bully PRD 12000

2011 N

10,000

40,000

Malaysia

Active

Noble Don Taylor

GustoMSC P10000

2013 N

12,000

40,000

U.S. Gulf of Mexico

Active

Noble Globetrotter I

Globetrotter Class

2011 N

10,000

30,000

U.S. Gulf of Mexico

Active

Noble Globetrotter II

Globetrotter Class

2013 N

10,000

30,000

South Africa

Active

Noble Sam Croft

GustoMSC P10000

2014 N

12,000

40,000

U.S. Gulf of Mexico

Available

Noble Tom Madden

GustoMSC P10000

2014 N

12,000

40,000

U.S. Gulf of Mexico

Available

Semisubmersibles—6

Noble Amos Runner

Noble EVA-4000™

1999 R/2008 M

8,000

32,500

U.S. Gulf of Mexico

Stacked

Noble Clyde Boudreaux

F&G 9500 Enhanced Pacesetter

2007 R/M

10,000

35,000

Singapore

Available

Noble Danny Adkins

Bingo 9000-DP

2009 R

12,000

35,000

U.S. Gulf of Mexico

Stacked

Noble Dave Beard

F&G 9500 Enhanced Pacesetter-DP

2009 R

10,000

35,000

Singapore

Stacked

Noble Jim Day

Bingo 9000-DP

2010 R

12,000

35,000

U.S. Gulf of Mexico

Stacked

Noble Paul Romano

Noble EVA-4000™

1998 R/2007 M

6,000

32,500

U.S. Gulf of Mexico

Active

Independent Leg Cantilevered Jackups—14

Noble Alan Hay

Levingston Class 111-C

2005 R

300

25,000

U.A.E.

Active

Noble David Tinsley

Modec 300C-38

2010 R

300

25,000

U.A.E.

Active

Noble Gene House

Modec 300C-38

1998 R

300

25,000

Saudi Arabia

Active

Noble Hans Deul (3)

F&G JU-2000E

2009 N

400

30,000

U.K.

Active

Noble Houston Colbert (3)

F&G JU-3000N

2014 N

400

30,000

Qatar

Active

Noble Joe Beall

Modec 300C-38

2004 R

300

25,000

Saudi Arabia

Active

Noble Lloyd Noble (3)

GustoMSC CJ70-x150-ST

2016 N

500

32,000

U.K.

Active

Noble Mick O’Brien (3)

F&G JU-3000N

2013 N

400

30,000

U.A.E.

Active

Noble Regina Allen (3)

F&G JU-3000N

2013 N

400

30,000

U.K.

Active

Noble Roger Lewis (3)

F&G JU-2000E

2007 N

400

30,000

Saudi Arabia

Active

Noble Sam Hartley (3)

F&G JU-3000N

2014 N

400

30,000

Brunei

Active

Noble Sam Turner (3)

F&G JU-3000N

2014 N

400

30,000

Denmark

Active

Noble Scott Marks (3)

F&G JU-2000E

2009 N

400

30,000

Saudi Arabia

Active

Noble Tom Prosser (3)

F&G JU-3000N

2014 N

400

30,000

U.A.E.

Available

WeFootnotes have actively expanded our offshore drilling and deepwater capabilities in recent years through the construction and acquisition of new rigs. As part of this technical and operational enhancement, we plan to ~~continue~~Drilling ~~pursuing~~Fleet ~~opportunities to upgrade our fleet to achieve greater technological capability, which should increase our operational efficiencies.~~ Table

~~During 2012~~1. Rigs designated with an “R” were modified, werefurbished ~~continued~~or ~~our~~otherwise ~~newbuild~~upgraded ~~program~~in asthe year indicated by capital expenditures in an amount deemed material by management. Rigs designated with an “N” are newbuilds. Rigs designated with an “M” have been upgraded to the ~~following~~Noble ~~activities:~~ NC-5SM mooring standard.

•2. weRigs ~~commenced~~listed ~~operations~~as on“active” ~~three~~are ~~dynamically~~operating, ~~positioned~~or ~~ultra-deepwater~~preparing to operate, ~~harsh~~under ~~environment~~contract; ~~drillships:~~rigs ~~two~~listed ~~Bully-class~~as ~~drillships~~“available” ~~currently~~are ~~operating~~actively inseeking ~~the~~contracts ~~U.S.~~and ~~Gulf~~may ofinclude ~~Mexico~~those ~~and~~that ~~Brazil~~are idle or warm stacked; rigs listed as “shipyard” are in a shipyard for construction, ~~respectively~~repair, refurbishment or upgrade; rigs listed as “stacked” are idle without a contract and ~~one~~have ~~Globetrotter-class~~reduced ~~drillship~~or ~~currently~~no ~~operating~~crew inand ~~the~~are ~~U.S.~~not ~~Gulf~~actively ofmarketed ~~Mexico;~~in present market conditions.

•3. weHarsh ~~continued construction on one dynamically positioned, ultra-deepwater, harsh~~ environment ~~Globetrotter-class drillship, which is scheduled to be delivered to our customer in the fourth quarter of 2013;~~capability.

•4. weWe ~~continued~~own ~~construction~~and onoperate ~~four~~the ~~dynamically~~Noble ~~positioned,~~Bully ~~ultra-deepwater,~~I ~~harsh~~and ~~environment~~Noble ~~drillships~~Bully atII ~~Hyundai~~through ~~Heavy~~joint ~~Industries~~ventures ~~Co.~~with ~~Ltd~~a subsidiary of Shell., Under the ~~first~~terms of ~~which~~the isjoint ~~estimated~~venture toagreements, beeach ~~delivered~~party ~~from~~has ~~the~~an ~~shipyard~~equal in50 ~~the~~percent ~~second~~ownership ~~quarter~~stake ofin ~~2013;~~both ~~and~~vessels.

• ~~we continued construction on six high-specification, heavy duty, harsh environment jackups, the first of which is estimated to be delivered from the shipyard in the second quarter of 2013.~~25

While we cannot predict the future level of demand or dayrates for our drilling services or future conditions in the offshore contract drilling industry, we continue to believe we are well positioned within the industry and believe our continued newbuild activity will further strengthen our position, especially in deepwater drilling. Facilities

WeOur ~~have~~corporate ~~entered~~headquarters ~~into~~is anlocated ~~agreement~~in ~~to sell our jackup~~London, ~~the~~England. ~~Noble~~We ~~Lewis~~also ~~Dugger,~~maintain tooffices ain ~~third~~Sugar ~~party that~~Land, ~~owns and operates supply vessels~~Texas, ~~platform~~where ~~drilling~~significant ~~rigs~~worldwide ~~and~~global ~~jackups~~support inactivity ~~Mexico~~occurs. ~~This~~ ~~unit~~In isaddition, ~~being~~we ~~sold~~own ~~for $61 million~~ and ~~the~~lease ~~closing~~operational, isadministrative ~~expected~~and tomarketing ~~occur~~offices, inas ~~the~~well ~~second~~as ~~quarter~~other ofsites ~~2013~~used ~~after~~primarily ~~the unit has completed its contract with its current customer. The transaction is subject to customary closing conditions. We had entered into an agreement to sell the Noble Don Walker~~ for ~~$18 million. The buyer was unable to close the transaction~~operations, ~~although~~storage weand ~~remain~~maintenance ~~in discussions~~and torepairs ~~potentially~~for ~~extend~~drilling ~~the~~rigs ~~sale~~and ~~agreement.~~equipment ~~The unit has been cold-stacked~~ in ~~Cameroon~~various ~~since~~locations ~~2009~~worldwide.

27Item 3. Legal Proceedings.

~~Table~~Information regarding legal proceedings is set forth in Note 17 to our consolidated financial statements included in Item 8 of ~~Contents~~this Annual Report on Form 10-K.

~~Contract~~Item ~~Drilling~~4. ~~Services~~Mine ~~Backlog~~Safety Disclosures.

WeNot ~~maintain a backlog (as defined below) of commitments for contract drilling services~~applicable. ~~The following table sets forth as of December 31, 2012 the amount of our contract drilling services backlog and the percent of available operating days committed for the periods indicated:~~

			Year Ending December 31,
	Total		2013			2014			2015			2016			2017-2023
	(In millions)
Contract Drilling Services Backlog
Semisubmersibles/Drillships (1) (5)	$	11,903	$	2,648		$	2,622		$	1,880		$	1,334		$	3,419
Jackups (2)		2,443		1,372			827			237			7			—
Total (3)	$	14,346	$	4,020		$	3,449		$	2,117		$	1,341		$	3,419
Percent of Available Days Committed (4)				74	%		50	%		22	%		10	%		5	%

PART II

~~(1)~~Item ~~Our drilling contracts with Petrobras provide an opportunity for us to earn performance bonuses based on downtime experienced for our rigs operating offshore Brazil~~5. ~~With~~Market ~~respect to our semisubmersibles operating offshore Brazil~~ for ~~Petrobras,~~Registrant’s weCommon ~~have included in our backlog an amount equal to 75 percent of potential performance bonuses for such semisubmersibles. With respect to our drillships presently operating offshore Brazil for Petrobras~~Equity, weRelated ~~have~~Stockholder ~~included~~Matters ~~in our backlog an amount equal to 75 percent of potential performance bonuses for periods after the estimated completion of certain upgrade projects that are designed to enhance the reliability~~ and ~~operational~~Issuer ~~performance~~Purchases of ~~the~~Equity ~~drillships~~Securities. ~~Our backlog for semisubmersibles/drillships includes approximately $197 million attributable to these performance bonuses.~~

~~The~~Market ~~drilling contracts with Shell~~ for ~~the~~Shares ~~Noble Globetrotter I, Noble Globetrotter II, Noble Jim Thompson, Noble Clyde Boudreaux, Noble Max Smith, Noble Don Taylor~~ and ~~the~~Related ~~Noble~~Shareholder Jim Day, provide opportunities for us to earn performance bonuses based on key performance indicators as defined by Royal Dutch Shell, PLC (“Shell”). With respect to these contracts, we have included in our backlog an amount equal to 50 percent of the potential performance bonuses for these rigs. Our backlog for these rigs includes approximately $409 million attributable to these performance bonuses.Information

~~(2)~~Noble-UK ~~Pemex~~shares ~~has~~are ~~the~~listed ~~ability~~and totraded ~~cancel its drilling contracts~~ on 30the ~~days~~New orYork ~~less~~Stock ~~notice~~Exchange ~~without~~under ~~Pemex’s~~the ~~making~~symbol an“NE.” ~~early~~The ~~termination~~following ~~payment.~~table Atsets ~~December~~forth ~~31,~~for ~~2012,~~the weperiods ~~had~~indicated 12the ~~rigs~~high ~~contracted~~and tolow ~~Pemex~~sales inprices ~~Mexico,~~ and ~~our~~dividends ~~backlog~~or ~~includes~~returns ~~approximately~~of ~~$613~~capital ~~million~~declared ~~related~~and topaid ~~such~~in ~~contracts~~U.S. Dollars per share:

(3) Our drilling contracts generally provide the customer an early termination right in the event we fail to meet certain performance standards, including downtime thresholds. For example, Petrobras has the right to terminate its contracts in the event of excessive downtime. While we have exceeded downtime thresholds in the past on certain rigs contracted with Petrobras, we have not received any notification concerning contract cancellations nor do we anticipate receiving any such notifications.



	High		Low		Cash Dividends Declared and Paid
2016
Fourth quarter	$	7.64	$	4.64	$	—
Third quarter	8.94		5.12		0.020
Second quarter	11.98		8.07		0.020
First quarter	13.56		6.91		0.150

2015
Fourth quarter	$	14.22	$	10.55	$	0.150
Third quarter	15.27		10.46		0.375
Second quarter	18.16		14.45		0.375
First quarter	19.51		13.55		0.375

~~(4)~~Our ~~Percentages~~most ~~take~~recent ~~into~~quarterly ~~account~~dividend ~~additional~~payment ~~capacity~~to ~~from~~shareholders, ~~the~~totaling ~~estimated~~approximately $5 ~~dates~~million (or of$0.02 ~~deployment~~per ofshare), ~~our~~was ~~newbuild~~declared ~~rigs~~on July 22, ~~that~~2016 and ~~are~~paid ~~scheduled~~on August 8, 2016 to ~~commence~~holders ~~operations~~of ~~during~~record ~~2013~~on August 1, ~~through 2015~~2016.

~~(5)~~Our ~~Noble~~Board ~~and a subsidiary~~ of ~~Shell~~Directors ~~are~~eliminated ~~involved~~our inquarterly ~~joint~~cash ~~ventures~~dividend ~~that own and operate both the Noble Bully I and the Noble Bully II. Under the terms~~ of ~~the joint venture agreements, each party has an equal 50 percent share in both vessels. As of December 31, 2012, the combined amount of backlog for these rigs totals~~ $20.2802 per ~~billion~~share, ~~all~~beginning ~~of which is included~~ in ~~our backlog. Noble’s proportional interest in~~ the ~~backlog~~fourth ~~for~~quarter ~~these~~of ~~rigs was $1~~2016.14 ~~billion.~~

~~Our~~The ~~contract~~declaration ~~drilling services backlog reported above reflects estimated future revenues attributable to both signed drilling contracts~~ and ~~letters~~payment of ~~intent~~dividends ~~that~~requires wethe ~~expect~~authorization toof ~~realize.~~the ABoard ~~letter~~ of ~~intent~~Directors isof ~~generally subject to customary conditions~~Noble-UK, ~~including~~provided ~~the~~that ~~execution~~such ofdividends aon ~~definitive~~issued ~~drilling contract.~~share Itcapital ismay ~~possible~~be ~~that~~paid ~~some~~only ~~customers~~out ~~that have entered into letters~~ of ~~intent~~Noble-UK’s ~~will~~“distributable ~~not~~reserves” ~~enter~~on ~~into~~its ~~signed~~statutory ~~drilling~~balance ~~contracts~~sheet. WeNoble-UK ~~calculate~~is ~~backlog~~not ~~for~~permitted ~~any~~to ~~given~~pay ~~unit~~dividends ~~and~~out ~~period~~of byshare ~~multiplying~~capital, ~~the~~which ~~full~~includes ~~contractual~~share ~~operating~~premiums. ~~dayrate~~The ~~for~~resumption ~~such unit~~of by the ~~number~~payment of ~~days~~future ~~remaining~~dividends inwill ~~the~~depend ~~period.~~on ~~The~~our ~~reported~~results ~~contract~~of ~~drilling~~operations, ~~services~~financial ~~backlog does not include amounts representing revenues for mobilization~~condition, ~~demobilization~~cash ~~and contract preparation~~requirements, ~~which~~future ~~are~~business ~~not expected to be significant to our contract drilling services revenues~~prospects, ~~amounts~~contractual ~~constituting~~restrictions ~~reimbursables~~and ~~from~~other ~~customers~~factors ordeemed ~~amounts~~relevant ~~attributable~~by toour ~~uncommitted~~Board ~~option periods under drilling contracts or letters~~ of ~~intent~~Directors.

28On February 15, 2017, there were 244,676,954 shares outstanding held by 341 shareholder accounts of record.

~~Table~~ ~~of Contents~~26

~~The~~UK ~~amount~~Tax ofConsequences ~~actual revenues earned and the actual periods during which revenues are earned may be materially different than the backlog amounts and backlog periods set forth in the table above due~~ to ~~various~~Shareholders ~~factors, including, but not limited to, shipyard and maintenance projects, unplanned downtime, achievement~~ of bonuses, weather conditions and other factors that result in applicable dayrates lower than the full contractual operating dayrate. In addition, amounts included in the backlog may change because drilling contracts may be varied or modified by mutual consent or customers may exercise early termination rights contained in some of our drilling contracts or decline to enter into a drilling contract after executing a letter of intent. As a result, our backlog as of any particular date may not be indicative of our actual operating results for the periods for which the backlog is calculated. Noble-UK

~~Nigerian~~The ~~Operations~~tax consequences discussed below do not reflect a complete analysis or listing of all the possible tax consequences that may be relevant to shareholders of Noble. Shareholders should consult their own tax advisors in respect of the tax consequences related to receipt, ownership, purchase or sale or other disposition of our shares.

AsUK ~~previously~~Income ~~disclosed,~~Tax inon ~~November~~Dividends ~~2010 we finalized settlements with the SEC~~ and ~~the~~Similar DOJ as the result of an internal investigation of the legality under the United States Foreign Corrupt Practices Act (“FCPA”) and local laws of certain reimbursement payments made by our Nigerian affiliate to our customs agents in Nigeria. In January 2011, a subsidiary of Noble-Swiss resolved an investigation by the Nigerian Economic and Financial Crimes Commission and the Nigerian Attorney General Office into these same activities. Any additional investigation by these or other agencies could damage our reputation and result in substantial fines, sanctions, civil and/or criminal penalties and curtailment of operations in certain jurisdictions and might adversely affect our business, results of operations or financial condition. Further, resolving any additional investigations could be expensive and consume significant time and attention of our senior management. Distributions

~~Acquisition~~A non-UK tax resident holder will not be subject to UK income taxes on dividend income and similar distributions in respect of ~~Frontier~~our ~~Holdings Limited~~shares, unless the shares are attributable to a permanent establishment or a fixed place of business maintained in the UK by such non-UK holder.

OnDisposition ~~July 28, 2010, Noble-Swiss and Noble AM Merger Co., a Cayman Islands company and indirect wholly-owned subsidiary~~ of Noble-~~Swiss~~UK (“Merger Sub”), completed the acquisition of FDR Holdings Limited, a Cayman Islands company (“Frontier”). Under the terms of the Agreement and Plan of Merger with Frontier and certain of Frontier’s shareholders, Merger Sub merged with and into Frontier, with Frontier surviving as an indirect wholly-owned subsidiary of Noble-Swiss and a wholly-owned subsidiary of Noble-Cayman. The Frontier acquisition was for a purchase price of approximately $1.7 billion in cash plus liabilities assumed and strategically expanded and enhanced our global fleet. Frontier’s results of operations were included in our results beginning July 28, 2010. We funded the cash consideration paid at closing of approximately $1.7 billion using proceeds from our July 2010 offering of senior notes and existing cash on hand. Shares

~~RESULTS~~Shareholders OFwho ~~OPERATIONS~~ are neither UK tax resident nor holding their Noble-UK shares in connection with a trade carried on through a permanent establishment in the UK will not be subject to any UK taxes on chargeable gains as a result of any disposals of their shares. Noble-UK shares held outside the facilities of The Depository Trust Company (“DTC”) should be treated as UK situs assets for the purpose of UK inheritance tax.

~~2012~~UK ~~Compared~~Withholding Tax—Dividends to ~~2011~~ Shareholders

~~General~~Payments of dividends by Noble-UK will not be subject to any withholding in respect of UK taxation, regardless of the tax residence of the recipient shareholder.

~~The~~Stamp ~~consolidated~~Duty ~~financial statements of Noble-Swiss include the accounts of Noble-Cayman,~~ and ~~Noble-Swiss~~Stamp ~~conducts~~Duty ~~substantially~~Reserve ~~all~~Tax ~~of its business through Noble-Cayman and its subsidiaries. As a result, the financial position and results of operations for Noble-Cayman, and the reasons for material changes~~ in ~~the~~Relation ~~amount~~to ~~of revenue and expense items between 2012 and 2011, would be~~ the ~~same~~Transfer as the information presented below regarding Noble-Swiss in all material respects, except operating income for Noble-Cayman for the year ended December 31, 2012 was $58 million higher than operating income for Noble-Swiss for the same period, primarily as a result of ~~costs directly attributable to Noble-Swiss for operations support and stewardship related services.~~ Shares

~~Net~~Stamp ~~income~~duty ~~attributable~~and/or tostamp ~~Noble~~duty ~~Corporation~~reserve ~~for~~tax ~~2012~~(“SDRT”) ~~was~~are ~~$522~~imposed ~~million,~~by orthe ~~$2.05~~UK ~~per~~on ~~diluted~~certain ~~share,~~transfers onof ~~operating~~chargeable ~~revenues~~securities (which include shares in companies incorporated in the UK) at a rate of $30.5 ~~billion,~~ ~~compared~~percent toof ~~net~~the ~~income~~consideration paid for ~~2011~~the transfers in question. Certain transfers of ~~$371~~shares ~~million,~~to depositaries or ~~$1.46~~into ~~per~~clearance ~~diluted~~systems ~~share,~~are oncharged ~~operating~~at ~~revenues~~a higher rate of $21.75 ~~billion~~percent. Her Majesty’s Revenue and Customs (“HMRC”) regard DTC as a clearance system for these purposes.

29Transfers of the Ordinary Shares through the facilities of DTC will not attract a charge to stamp duty or SDRT in the UK. Any transfer of title to Ordinary Shares from within those facilities to a holder outside those facilities, and any subsequent transfers that occur entirely outside those facilities, will ordinarily attract stamp duty or SDRT at a rate of 0.5 percent. This duty must be paid (and, where relevant, the transfer document stamped by HMRC) before the transfer can be registered in the books of Noble-UK. However, if those Ordinary Shares of Noble-UK are redeposited into the facilities of DTC, that redeposit will attract stamp duty or SDRT at the rate of 1.5 percent.

~~Table~~Share ~~of Contents~~Repurchases

~~Rig~~Under ~~Utilization~~UK law, ~~Operating~~the ~~Days~~Company is only permitted to purchase its own shares by way of an “off-market purchase” in a plan approved by shareholders. In December 2014, we received shareholder approval to repurchase up to 37 million ordinary shares, or approximately 15 percent of our outstanding ordinary shares at the time of such shareholder approval. The authority to make such repurchases expired at the end of the Company’s 2016 annual general meeting of shareholders, which was held on April 22, 2016. During 2015, we repurchased 6.2 million of our ordinary shares covered by this authorization at an average price of $16.10 per share, excluding commissions and ~~Average~~stamp ~~Dayrates~~tax, for a total cost of approximately $101 million. All share repurchases were made in the open market and were pursuant to the share repurchase program discussed above. All shares repurchased during 2015 were immediately cancelled. During the year ended December 31, 2016, we did not repurchase any of our shares.

~~Operating~~ revenues and operating costs and expenses for our contract drilling services segment are dependent on three primary metrics: rig utilization, operating days and dayrates. The following table sets forth the average rig utilization, operating days and average dayrates for our rig fleet for 2012 and 2011 (dollars in thousands): 27

	Average Rig						Operating							Average
	Utilization (1)						Days (2)							Dayrates
	2012			2011			2012		2011		% Change			2012		2011		% Change
Jackups		82	%		75	%		12,966		11,794		10	%	$	96,696	$	85,510		13	%
Semisubmersibles		86	%		82	%		4,382		4,176		5	%		349,205		296,331		18	%
Drillships		69	%		59	%		2,023		1,284		58	%		279,432		242,019		15	%
Other		0	%		0	%		—		—		—			—		—		—
Total		78	%		72	%		19,371		17,254		12	%	$	172,904	$	148,185		17	%

Stock Performance Graph

~~(1)~~This ~~Information~~graph ~~reflects~~shows ~~our~~the ~~policy~~cumulative total shareholder return of ~~reporting~~our onshares over the ~~basis~~five-year ofperiod ending December 31, 2016. The graph also shows the ~~number~~cumulative total returns for the same five-year period of ~~actively~~the ~~marketed~~S&P ~~rigs~~500 Index and the Dow Jones U.S. Oil Equipment & Services Index. The graph assumes that $100 was invested in our ~~fleet~~shares ~~excluding~~and ~~newbuild~~the ~~rigs~~two ~~under~~indices ~~construction~~on January 1, 2012 and that all dividends or distributions and returns of capital were reinvested on the date of payment.

(2) Information reflects the number of days that our rigs were operating under contract.



	INDEXED RETURNS Year Ended December 31,
Company / Index	2012		2013		2014		2015		2016
Noble-UK	$	116.98	$	128.45	$	67.77	$	47.01	$	26.98
S&P 500 Index	116.00		153.57		174.60		177.01		198.18
Dow Jones U.S. Oil Equipment & Services	100.33		128.83		106.64		82.67		105.26

~~Contract~~Investors ~~Drilling~~are ~~Services~~cautioned against drawing any conclusions from the data contained in the graph, as past results are not necessarily indicative of future performance.

The ~~following~~above ~~table~~graph ~~sets~~and ~~forth~~related information shall not be deemed “soliciting material” or to be “filed” with the ~~operating~~ ~~revenues~~SEC, ~~and~~nor shall such information be incorporated by reference into any future filing under the ~~operating~~Securities ~~costs~~Act ~~and~~or ~~expenses~~the ~~for~~Exchange ~~our~~Act, ~~contract~~except ~~drilling~~to ~~services~~the ~~segment~~extent ~~for~~that ~~2012~~we ~~and~~specifically ~~2011~~incorporate ~~(dollars~~it inby ~~thousands):~~reference into such filing.

							Change
	2012			2011			$			%
Operating revenues:
Contract drilling services	$	3,349,362		$	2,556,758		$	792,604			31	%
Reimbursables (1)		112,956			77,278			35,678			46	%
Other		265			875			(610	)		-70	%
	$	3,462,583		$	2,634,911		$	827,672			31	%
Operating costs and expenses:
Contract drilling services	$	1,776,481		$	1,384,200		$	392,281			28	%
Reimbursables (1)		91,646			56,589			35,057			62	%
Depreciation and amortization		745,027			647,142			97,885			15	%
Selling, general and administrative		97,967			90,262			7,705			9	%
Loss on impairment		12,710			—			12,710				**
Gain on contract settlements/extinguishments, net		(33,255	)		(21,202	)		(12,053	)		57	%
		2,690,576			2,156,991			533,585			25	%
Operating income	$	772,007		$	477,920		$	294,087			62	%

~~(1)~~Item ~~We record reimbursements from customers for out-of-pocket expenses as operating revenues and the related direct costs as operating expenses~~6. ~~Changes~~Selected inFinancial ~~the amount of these reimbursables generally do not have a material effect on our financial position, results of operations or cash flows~~Data.

**The ~~Not~~following atable ~~meaningful~~sets ~~percentage~~forth selected financial data of us and our consolidated subsidiaries over the five-year period ended December 31, 2016, which information is derived from our audited financial statements. This information should be read in connection with, and is qualified in its entirety by, the more detailed information in our financial statements included in Item 8 of this Annual Report on Form 10-K.

Operating Revenues. Changes in contract drilling services revenues for the current year as compared to the prior year were driven by increases in both average dayrates and operating days. The 17 percent increase in average dayrates increased revenues by approximately $479 million while the 12 percent increase in operating days increased revenues by an additional $314 million.



	Year Ended December 31,
	2016			2015			2014			2013			2012
	(In thousands, except per share amounts)
Statement of Income Data
Operating revenues from continuing operations	$	2,302,065		$	3,352,252		$	3,232,504		$	2,538,143		$	2,200,699
Net income (loss) from continuing operations attributable to Noble-UK ⁽¹⁾	(929,580		)	511,000			(152,011		)	478,595			414,389
Net income (loss) from continuing operations per share attributable to Noble-UK:
Basic	(3.82		)	2.06			(0.60		)	1.86			1.63
Diluted	(3.82		)	2.06			(0.60		)	1.86			1.63
Balance Sheet Data (at end of period)
Cash and marketable securities	$	725,722		$	512,245		$	68,510		$	114,458		$	282,092
Property and equipment, net	10,061,948			11,483,623			12,112,509			14,558,090			13,025,972
Total assets ⁽⁵⁾	11,440,117			12,865,645			13,266,480			16,194,639			14,580,886
Long-term debt ⁽⁵⁾	4,040,229			4,162,638			4,848,678			5,532,933			4,607,487
Total debt ^{(2) (5)}	4,340,111			4,462,562			4,848,678			5,532,933			4,607,487
Total equity	6,467,445			7,422,230			7,287,034			9,050,028			8,488,290
Other Data
Net cash from operating activities	$	1,128,282		$	1,762,351		$	1,778,208		$	1,702,317		$	1,381,693
Net cash from investing activities	(669,931		)	(432,537		)	(2,109,268		)	(2,485,107		)	(1,790,888		)
Net cash from financing activities	(244,874		)	(886,079		)	285,112			615,156			452,091
Capital expenditures⁽³⁾	659,925			422,544			2,072,885			2,487,520			1,669,811
Working capital^{(4) (5)}	$	559,321		377,034			259,888			339,020			393,876
Cash distributions declared per share	0.20			1.28			1.50			0.76			0.54

~~The~~(1) ~~increase~~Results infor ~~contract~~2016, ~~drilling~~2015, ~~services~~2014, ~~revenues~~2013 ~~relates~~and to2012 ~~our~~include ~~semisubmersibles,~~impairment ~~drillships~~charges ~~and~~of ~~jackups~~$1.5 billion, ~~which generated~~$418 ~~approximately~~million, $~~293~~745 million, $~~255~~4 million and $~~245~~20 million ~~more revenue~~, respectively~~, in 2012~~.

30(2) Consists of Long-term debt and Current maturities of long-term debt.

~~Table~~(3) Capital expenditures includes expenditures made for rigs that were ultimately transferred to Paragon Offshore as part of ~~Contents~~the Spin-off.

~~The~~(4) 18Working ~~percent~~capital increase in semisubmersible average dayrates resulted in a $232 million increase in revenues from the prior year while the increase in operating days of 5 percent resulted in an additional $61 million increase in revenues. The increase in semisubmersibles revenue is acalculated ~~result of our rigs returning to standard operating dayrates after experiencing lower standby rates due to drilling restrictions in the U.S. Gulf of Mexico in the prior year,~~ as ~~well~~current asassets ~~the~~less Noble Paul Romano returning to work after being stacked for most of the prior year. The increase in operating days is primarily from the Noble Jim Day, the Noble Homer Ferrington, the Noble Paul Romano, the Noble Clyde Boudreaux and the Noble Amos Runner, which all operated during the current ~~year after being off contract for the majority of the prior year~~liabilities.

~~The~~(5) ~~increase~~Certain amounts in ~~drillship~~prior ~~revenues~~periods ~~was~~have ~~driven~~been byreclassified ato 58conform ~~percent~~to ~~increase~~the ~~in operating~~current ~~days~~year ~~and~~presentation. aIn 15accordance ~~percent~~with ~~increase~~our inadoption ~~average~~of ~~dayrates,~~Accounting ~~resulting~~Standard inUpdate aNo. ~~$179 million and a $76 million increase in revenues~~2015-3, ~~respectively,~~unamortized ~~from~~debt ~~the~~issuance ~~prior~~costs ~~year.~~related ~~The~~to ~~increase~~our insenior ~~both~~notes ~~average~~are ~~dayrates~~now ~~and~~shown ~~operating~~as ~~days~~a ~~was~~direct ~~the~~reduction ~~result~~ of the ~~Noble~~ ~~Bully~~carrying I,amount ~~Noble~~of ~~Bully~~the IIrelated ~~and~~debt. ~~Noble~~See ~~Globetrotter~~Part III, ~~which~~Item ~~commenced their contracts with Shell in March 2012~~8, ~~April~~ ~~2012~~“Financial Statements and ~~July~~Supplementary ~~2012~~Data", ~~respectively.~~Note ~~These~~1 ~~increases were partially offset by the Noble Phoenix, which completed its shipyard project~~ and ~~was~~Note ~~substituted~~9 for ~~the~~more ~~Noble Muravlenko in Brazil during the current year, and a reduced rate on the Noble Roger Eason while it is in the shipyard to undergo its reliability upgrade project~~information.

~~The~~Item 13 percent increase in jackup average dayrates resulted in a $145 million increase in revenues, which was coupled with a 10 percent increase in jackup operating days, resulting in a $100 million increase in revenues from the prior year7. ~~The~~Management’s ~~increase~~Discussion inand ~~average~~Analysis ~~dayrates~~of ~~resulted~~Financial ~~from~~Condition ~~improved market conditions in the global shallow water market throughout the jackup fleet. The increase in utilization primarily related to rigs in Mexico, West Africa~~ and ~~the~~Results ~~Middle~~of ~~East, which experienced less downtime during the current year~~Operations.

~~Operating~~The ~~Costs~~following ~~and~~discussion ~~Expenses.~~is ~~Contract~~intended ~~drilling services operating costs and expenses increased $392 million for the current year as compared~~ to ~~the~~assist ~~prior~~you ~~year. A portion of the increase is due to the crew-up and operating expenses for the recently completed rigs noted above, which have added approximately $139 million~~ in ~~expense~~understanding ~~in the current year. Excluding the additional expenses related to these rigs,~~ our ~~contract~~financial ~~drilling~~position ~~costs increased~~at ~~$253 million in the current year from the prior year. This change was primarily driven by a $75 million increase in labor due to rigs returning~~December 31, or2016 ~~preparing~~and ~~to return~~2015, ~~to work~~ and ~~salary~~our ~~increases~~results ~~effective~~of inoperations ~~the~~for ~~second~~each ~~and third quarters~~ of the ~~prior~~years ~~year, a $47 million increase~~ in ~~shorebase support due to salary increases in~~ the ~~current~~ three-year ~~and~~period ~~increased~~ended ~~project-related costs~~December 31, a2016. ~~$44~~The ~~million~~following ~~increase~~discussion inshould ~~maintenance~~be ~~and~~read ~~rig-related expense, a $26 million increase~~ in ~~mobilization~~ ~~due~~conjunction towith the ~~amortization~~consolidated offinancial ~~certain~~statements ~~rig moves~~ and ~~the~~related ~~demobilization~~notes ofcontained ~~rigs primarily~~ in ~~Mexico,~~this aAnnual ~~$20~~Report ~~million increase in insurance costs related to increased premiums~~ on ~~our~~Form ~~policy~~10-K ~~renewed~~for inthe ~~March~~year ~~2012,~~ended ~~a $14 million increase in rig catering and communications~~December 31, a2016 ~~$13~~filed ~~million~~by ~~increase~~Noble-UK ~~in safety, training~~ and ~~regulatory inspections, a $6 million increase in agency and other miscellaneous expenses, a $5 million increase in fuel and transportation costs and a $3 million increase in rotation costs~~Noble-Cayman.

~~Depreciation~~The ~~and~~results ~~amortization~~of ~~increased~~operations ~~$98~~for ~~million~~Paragon inOffshore ~~2012~~prior ~~over~~to ~~2011~~August 1, ~~which~~2014, isthe ~~primarily~~Spin-off ~~attributable~~date, and non-recurring costs related to ~~assets~~ ~~placed~~the Spin-off have been classified as discontinued operations for all periods presented in ~~service~~this ~~during~~report. ~~the~~The ~~current~~terms ~~year,~~“earnings” ~~including~~and ~~the~~“loss” ~~Noble~~as ~~Bully~~used I,in ~~Noble~~this ~~Bully~~“Management’s IIDiscussion and ~~the~~Analysis ~~Noble~~of ~~Globetrotter~~Financial I.Condition and Results of Operations” refer to income

~~Loss~~ ~~on impairment during the current year related to an impairment charge on our submersible fleet, primarily as a result of the declining market outlook for drilling services for this rig type.~~ 29

~~Gain~~or onloss ~~contract~~from ~~settlements/extinguishments~~continuing ~~during the current year related to a $28 million gain on the settlement of an action with certain vendors for damages sustained during Hurricane Ike~~operations. ~~Additionally,~~Income weor ~~received~~loss ~~$5 million~~ from acontinuing ~~claims~~operations ~~settlement~~is onrepresentative of the ~~Noble~~Company’s ~~David~~current ~~Tinsley,~~business ~~which~~operations ~~had~~and ~~experienced a “punch-through” while being positioned on location in 2009~~focus.

31Executive Overview

~~Table~~Our of2016 ~~Contents~~financial and operating results from continuing operations include:

~~Other~~• operating revenues totaling $2.3 billion;

~~The~~• ~~following~~net ~~table~~loss ~~sets~~of ~~forth~~$930 ~~the~~million, ~~operating~~or ~~revenues~~$3.82 ~~and~~per ~~the~~diluted ~~operating~~share, ~~costs~~which ~~and~~includes ~~expenses~~a ~~for~~$1.3 ~~our~~billion ~~other~~after-tax ~~services~~impairment ~~for~~charge ~~2012~~recognized on five of our rigs and ~~2011~~certain ~~(dollars~~capital inspare ~~thousands):~~equipment; and

					Change
	2012		2011		$			%
Operating revenues:
Labor contract drilling services	$	81,890	$	59,004	$	22,886			39	%
Reimbursables (1)		2,539		1,917		622			32	%
	$	84,429	$	60,921	$	23,508			39	%
Operating costs and expenses:
Labor contract drilling services	$	46,895	$	33,885	$	13,010			38	%
Reimbursables (1)		2,450		1,850		600			32	%
Depreciation and amortization		13,594		11,498		2,096			18	%
Selling, general and administrative		2,023		1,115		908			81	%
Loss on impairment		7,674		—		7,674				**
		72,636		48,348		24,288			50	%
Operating income	$	11,793	$	12,573	$	(780	)		-6	%


•	net cash from operating activities totaling $1.1 billion.

~~(1)~~The Webusiness ~~record~~environment ~~reimbursements~~for ~~from~~offshore drillers during 2016 remained challenging. A rig supply imbalance expanded throughout 2016, primarily due to reduced offshore spending by customers, ~~for~~leaving ~~out-~~a growing number of rigs without follow-~~pocket~~on ~~expenses~~drilling programs as ~~operating~~contracts ~~revenues~~expired. ~~and~~In ~~the~~addition, ~~related~~newbuild ~~direct~~rigs ~~costs~~ordered asprior ~~operating~~to ~~expenses.~~the ~~Changes~~decline in ~~the~~industry ~~amount~~activity ofcontinue ~~these~~to ~~reimbursables~~exit ~~generally~~shipyards, doadding ~~not~~to the supply imbalance. Our customers have adopted a ~~material~~cautious ~~effect~~approach to offshore spending as crude oil prices declined from approximately $112 per barrel on ~~our~~June ~~financial~~30, ~~position~~2014 to as low as approximately $30 per barrel in January 2016, ~~results~~before improving to $56 per barrel on February 15, 2017. We expect that the offshore drilling programs of ~~operations~~operators orwill ~~cash~~remain ~~flows~~curtailed, especially exploration activity, until higher, sustained crude oil prices are achieved. Until then, further deterioration in rig utilization and dayrates is possible.

**We ~~Not~~expect the business environment for 2017 to remain weak and it could potentially deteriorate further. The present subdued level of global economic activity, the uncertainty of the viability and length of reductions in production agreed to by the Organization of Petroleum Exporting Countries (“OPEC”) in November 2016, the incremental production capacity in non-OPEC countries, including the current U.S. political environment, and the Brexit vote in the UK are contributing to an uncertain oil price environment, leading to considerable uncertainity in our customers’ exploration and production spending plans. However, the production limits recently agreed to by OPEC could help to establish market conditions supporting higher, sustained crude prices in 2017. In general, recent contract awards have been short-term in nature and subject to an extremely competitive bidding process. As a ~~meaningful~~result, ~~percentage~~the contracts have been for dayrates that are substantially lower than rates were for the same class of rigs before this period of imbalance. We cannot give any assurances as to when conditions in the offshore drilling market will improve, or when the oversupply of available drilling rigs will end. While current market conditions persist, we will continue to focus on operating efficiency, cost control and managing liquidity and could stack or retire additional drilling rigs.

~~Operating~~While ~~Revenues~~we ~~and~~cannot ~~Costs~~predict ~~and~~the ~~Expenses.~~future ~~The~~level ~~increase~~of indemand ~~both~~or ~~revenue~~dayrates ~~and~~for ~~expense~~our ~~primarily~~services, ~~relates~~or tofuture aconditions ~~project~~in ~~with~~the ~~our customer,~~offshore ~~Shell,~~contract ~~for~~drilling ~~one~~industry, ofwe ~~its~~believe ~~rigs~~we ~~operating~~are ~~under~~strategically awell ~~labor contract in Alaska~~positioned.

~~Loss~~We onbelieve ~~impairment~~in ~~during~~the long-term fundamentals for the ~~current~~industry, ~~year related~~especially tofor anthose ~~impairment~~contractors ~~charge~~with ona ~~certain~~modern ~~corporate~~fleet ~~assets~~of high-specification rigs like ours. We expect the persistent rig supply imbalance to improve over time, aswith athe ~~result~~combination of further fleet attrition and a ~~declining~~rebound ~~market~~in ~~for~~offshore spending by our customers. Also, ~~and~~we believe the ~~potential~~ultimate ~~disposal~~market recovery will benefit from any sustained under-investment by customers during the current phase of, the ~~assets.~~market cycle.

~~Other~~Our ~~Income~~business strategy focuses on a balanced fleet of both deepwater drilling and ~~Expenses~~high-specification jackup assets and the deployment of our drilling rigs in important oil and gas basins around the world.

~~Selling~~Over the past five years, ~~general~~we ~~and~~have ~~administrative expenses~~expanded our drilling fleet through our newbuild program. ~~Overall~~We ~~selling~~took delivery of our remaining newbuild, ~~general~~the ~~and~~heavy-duty, ~~administrative~~harsh ~~expenses~~environment ~~increased~~jackup, $9Noble ~~million~~Lloyd Noble, in ~~2012~~July ~~from~~2016. ~~2011~~The ~~primarily~~Noble asLloyd Noble has commenced operations in November 2016 under a ~~result~~four-year ofcontract ~~increased~~in ~~legal~~the North Sea. Although we plan to focus on capital preservation and ~~tax~~liquidity ~~expenses~~based ~~related~~on current market conditions, we also continue to ~~ongoing~~evaluate ~~projects~~opportunities ofto $5enhance ~~million~~our fleet, ~~coupled~~particularly ~~with~~focusing ~~increases~~on ~~in employee-related~~higher ~~costs~~specification ofrigs, $4to ~~million.~~execute the increasingly complex drilling programs required by our customers.

Interest Expense, net of amount capitalized. Interest expense, net of amount capitalized, increased $30 million in 2012 from 2011. The increase is a result of the $1.2 billion of senior notes issued in February 2012, coupled with lower capitalized interest due primarily to the completion of construction on three of our newbuild drillships. During the current year, we capitalized approximately 61 percent of total interest charges versus approximately 69 percent during the prior year. Impairment

~~Income~~We ~~Tax~~evaluate ~~Provision.~~the ~~Our~~impairment ~~income~~of ~~tax~~property ~~provision~~and ~~increased~~equipment ~~$74~~whenever ~~million~~events or changes in ~~2012~~circumstances ~~compared~~(including the decision to ~~2011~~cold ~~primarily~~stack, asretire or sale a ~~result~~rig) ofindicate athat ~~higher~~the ~~pre-tax~~carrying ~~earnings~~amount ~~and~~of ~~effective~~an ~~tax~~asset ~~rate~~may ~~during~~not ~~the~~be ~~current year~~recoverable. ~~Pre-tax~~In ~~earnings~~addition, ~~increased~~on ~~approximately~~an 61annual ~~percent~~basis in ~~2012~~the ~~compared~~fourth toquarter, ~~2011~~we ~~resulting~~complete inan aimpairment ~~$45~~analysis ~~million~~on ~~increase~~our inrig ~~income~~fleet. ~~tax~~An ~~expense.~~impairment ~~The~~loss ~~higher~~on ~~effective~~our ~~tax~~property ~~rate,~~and ~~which~~equipment ~~was~~may ~~20.9~~exist ~~percent~~when inthe ~~2012~~estimated ~~compared~~undiscounted cash flows expected to ~~16.7~~result ~~percent~~from inthe ~~2011,~~use ~~increased income~~of ~~tax~~the ~~expense~~asset byand ~~approximately~~its ~~$29~~eventual ~~million~~disposition are less than its carrying amount. ~~The~~ ~~increase~~Any inimpairment loss recognized represents the ~~effective~~excess ~~tax~~of ~~rate~~the ~~was~~asset's acarrying ~~result~~value ofover athe ~~change~~estimated infair ~~our~~value. ~~geographic~~As ~~mix~~part of ~~our~~this ~~revenues~~analysis, we make assumptions and estimates regarding future market conditions. To the ~~resolution~~extent actual results do not meet our estimated assumptions, for a given rig or piece of ~~certain~~equipment, ~~discrete~~we ~~tax~~may ~~items.~~take an impairment loss in the future.

~~2011~~In ~~Compared~~connection towith ~~2010~~our annual impairment analysis as of the end of 2016, we identified indicators that certain assets in our fleet might not be recoverable. Such indicators included the significant supply/demand rig imbalance, additional customer

~~General~~ 30

~~The consolidated~~suspensions ~~financial statements~~ of ~~Noble-Swiss~~drilling ~~include~~programs, ~~the~~contract ~~accounts~~cancellations ofand ~~Noble-Cayman,~~a ~~and~~further ~~Noble-Swiss~~reduction ~~conducts~~in ~~substantially~~the ~~all~~number of ~~its~~new ~~business~~contract ~~through~~opportunities, ~~Noble-Cayman~~resulting ~~and~~in ~~its~~a ~~subsidiaries~~reduced number of overall drilling contracts. As a result of our year-end testing, ~~the~~we ~~financial~~determined ~~position~~that ~~and~~the ~~results~~carrying amounts of ~~operations~~ ~~for~~certain ~~Noble-Cayman,~~drilling ~~and~~units were impaired. We estimated the ~~reasons~~fair ~~for~~values ~~material~~of ~~changes~~these inunits by applying the ~~amount~~income valuation approach utilizing significant unobservable inputs, representative of ~~revenue~~a ~~and~~Level ~~expense~~3 ~~items~~fair ~~between~~value ~~2011~~measurement. Assumptions ~~and~~used ~~2010~~in our assessment included, ~~would~~but bewere ~~the~~not ~~same~~limited asto, ~~the~~timing ~~information~~of ~~presented~~future ~~below~~contract ~~regarding~~awards ~~Noble-Swiss~~and inexpected ~~all~~operating ~~material~~day ~~respects~~rates, ~~except~~ operating ~~income~~ ~~for~~costs, ~~Noble-Cayman~~utilization ~~for~~rates, ~~the~~capital ~~year~~expenditures, ~~ended~~reactivation ~~December 31~~costs and estimated economic useful lives. Based upon our annual impairment analysis, ~~2011~~we ~~was~~impaired ~~$49~~the ~~million~~carrying ~~higher~~values ~~than~~to ~~operating~~estimated ~~income~~fair values for the Noble~~-Swiss~~ ~~for~~Amos Runner, the ~~same~~Noble ~~period,~~Clyde ~~primarily~~Boudreaux asand athe ~~result~~Noble ofDave ~~costs~~Beard. ~~directly~~The ~~attributable~~impairment tocharge ~~Noble-Swiss~~related ~~for~~to ~~operations~~these ~~support~~units ~~and stewardship~~was ~~related~~approximately ~~services~~$1 billion.

32If we believe that one of our drilling units is no longer marketable or is otherwise unlikely to return to active service, we may elect to retire the unit and/or sell the unit at a value that may be substantially below its book value, and recognize an impairment charge that reduces the asset’s carrying value to the estimated fair value. In late December 2016, we decided to retire from service and sell for scrap our semisubmersible, the Noble Max Smith, which we sold in December for approximately $1 million, and we recognized an impairment charge of approximately $165 million. We will continue to analyze the market and our expectations for our fleet, and we may retire and/or sell other units (which may be at a substantial loss compared to book value) if we conclude that it is appropriate to do so.

~~Table~~Also in the fourth quarter of ~~Contents~~2016, in connection with our annual impairment analysis, we concluded that the semisubmersible, the Noble Homer Ferrington and certain capital spare equipment would not be utilized in the foreseeable future, and we recognized an impairment charge of $120 million and $154 million, respectively. In the second quarter of 2016, we recognized a charge of approximately $17 million for the impairment of certain capital spare equipment based upon our decision to dispose of this equipment.

~~Net~~In ~~income~~connection ~~attributable~~with toour 2015 annual impairment analysis, we decided that we would no longer market one of our drillships, the Noble ~~Corporation~~Discoverer. ~~for~~The ~~2011~~decision was ~~$371~~a ~~million,~~result orof $1the termination of the contract for this rig by Shell in December 2015 and the decreased opportunities for rigs of this type in the current marketplace.46 ~~per~~We ~~diluted share,~~also reviewed assumptions on ~~operating~~the ~~revenues~~future marketability of ~~$2.7~~one ~~billion~~of our jackups, ~~compared~~the Noble Charles Copeland, after its contract completion in late September 2015, with consideration given to ~~net~~its ~~income~~years ~~for~~in ~~2010~~service, limited technical features and anticipated capital requirements in light of ~~$773~~the ~~million~~current market conditions. As a result of this analysis, orwe $3decided to discontinue marketing this unit.02 ~~per~~Additionally, ~~diluted~~as ~~share~~a result of a year-end 2015 review of capital spare equipment, onwe ~~operating~~elected ~~revenues~~to retire certain capital spare equipment. We evaluated these units and capital spare equipment for impairment and recorded an impairment charge of $~~2.8~~406 ~~billion~~million for the year ended December 31, 2015.

~~Rig~~Also ~~Utilization~~in 2015, ~~Operating~~we ~~Days~~determined that certain corporate assets were partially impaired due to a declining market for, and ~~Average~~the ~~Dayrates~~potential disposal of, the assets. We estimated the fair value of the assets based on quotes from brokers of similar assets (Level 2). Based on these estimates, we recorded an impairment charge of approximately $13 million for the year ended December 31, 2015.

~~Operating revenues~~In ~~and~~connection ~~operating~~with ~~costs~~our ~~and~~2014 ~~expenses~~annual ~~for~~impairment analysis, we decided to discontinue marketing three of our ~~contract~~semisubmersibles, ~~drilling~~the ~~services~~Noble ~~segment~~Driller, ~~are~~the ~~dependent~~Noble onJim ~~three~~Thompson ~~primary~~and ~~metrics:~~the ~~rig~~Noble ~~utilization~~Paul Wolff, ~~operating~~because ~~days~~of then current market conditions. We evaluated these units for impairments and ~~dayrates~~recorded an impairment charge of $685 million on these units. ~~The~~Additionally, ~~following~~we ~~table~~fully ~~sets~~impaired ~~forth~~the $60 million of goodwill on our books, which originated from the ~~average~~acquisition ~~rig~~of ~~utilization~~FDR Holdings Limited (“Frontier”) in 2010, ~~operating~~as ~~days~~a ~~and average~~result ~~dayrates~~of ~~for~~a significant decline in the market value of our ~~rig~~stock, ~~fleet~~a ~~for~~decrease ~~2011~~in oil and ~~2010~~gas ~~(dollars~~prices, significant reductions in ~~thousands):~~the projected dayrates for new contracts and reduced utilization forecasts.

	Average Rig						Operating							Average
	Utilization (1)						Days (2)							Dayrates
	2011			2010			2011		2010		% Change			2011		2010		% Change
Jackups		75	%		79	%		11,794		12,376		-5	%	$	85,510	$	96,935		-12	%
Semisubmersibles		82	%		86	%		4,176		3,837		9	%		296,331		288,163		3	%
Drillships		59	%		89	%		1,284		1,392		-8	%		242,019		256,067		-5	%
Other		0	%		11	%		—		95		-100	%		—		355,986		-100	%
Total		72	%		78	%		17,254		17,700		-3	%	$	148,185	$	152,292		-3	%

Spin-off of Paragon Offshore plc

(On August 1), ~~Information~~2014, ~~reflects~~Noble-UK ~~our~~completed ~~policy~~the separation and spin-off of ~~reporting~~a onmajority of its standard specification offshore drilling business through a pro rata distribution of all of the ~~basis~~ordinary shares of its wholly-owned subsidiary, Paragon Offshore, to the ~~number~~holders of ~~actively~~Noble’s ~~marketed~~ordinary ~~rigs~~shares. inOur shareholders received one share of Paragon Offshore for every three shares of Noble owned as of July 23, 2014, the record date for the distribution. Through the Spin-off, we disposed of most of our ~~fleet~~standard ~~excluding~~specification ~~newbuild~~drilling ~~rigs~~units and related assets, liabilities and business. Prior to the Spin-off, Paragon Offshore issued approximately $1.7 billion of long-term debt. We used the proceeds from this debt to repay certain amounts outstanding under ~~construction~~our commercial paper program. The results of operations for Paragon Offshore prior to the Spin-off date and incremental Spin-off related costs have been classified as discontinued operations for the year ended December 31, 2014. There were no discontinued operations in 2016 or 2015.

In April 2016, we entered into a settlement agreement with Paragon Offshore (2following the execution of an agreement in principle in February 2016) ~~Information~~under ~~reflects~~which, ~~the~~in ~~number~~exchange for a full and unconditional release of ~~days~~any claims by Paragon Offshore in connection with the Spin-off (including fraudulent conveyance claims that ~~our~~could ~~rigs~~be ~~were~~brought ~~operating~~on ~~under~~behalf ~~contract~~of Paragon Offshore’s creditors), we agreed to assume the administration of Mexican tax claims for specified years up to and including 2010, as well as the related bonding obligations and certain of the related tax liabilities. The settlement agreement with Paragon Offshore is subject to the approval of Paragon Offshore's bankruptcy plan by the bankruptcy court. On October 28, 2016, the bankruptcy court having

~~Contract~~ ~~Drilling Services~~ 31

jurisdiction over the Paragon Offshore bankruptcy denied confirmation of Paragon Offshore’s bankruptcy plan. On January 18, 2017, Paragon Offshore announced that it had reached an agreement in principle with an ad hoc committee of secured debt holders on a term sheet to support a new bankruptcy plan. The ~~following~~term ~~table~~sheet ~~sets~~contemplates ~~forth~~that the ~~operating~~ ~~revenues~~existing settlement agreement between Noble and Paragon Offshore will be adopted under the ~~operating~~new ~~costs~~bankruptcy plan. Paragon Offshore also stated that it will seek to obtain court approval of the new bankruptcy plan as soon as possible in the first half of 2017. Paragon Offshore’s unsecured creditors are not parties to the agreement in principle, and ~~expenses~~have ~~for~~formed an ad hoc committee which we expect to oppose Paragon's new bankruptcy plan, including our ~~contract~~settlement. ~~drilling~~There ~~services~~can ~~segment~~be no assurance that the bankruptcy court will ultimately approve our settlement agreement with Paragon Offshore or Paragon Offshore’s bankruptcy plan. If for ~~2011~~any ~~and~~reason ~~2010~~the ~~(dollars~~agreement is not approved by the bankruptcy court or included as part of an approved plan or Paragon Offshore fails to exit bankruptcy, Paragon Offshore or its creditors could become adverse to us in ~~thousands~~any potential litigation relating to the Spin-off, including any alleged fraudulent conveyance claim in connection with the creation of Paragon Offshore as a stand-alone entity. For additional information regarding the Spin-off, see Part II, Item 8, “Financial Statements and Supplementary Data, Note 2—Spin-off of Paragon Offshore plc ("Paragon Offshore"):” and Part II, Item 8, “Financial Statements and Supplementary Data, Note 17—Commitments and Contingencies.”

						Change
	2011			2010		$ %
Operating revenues:
Contract drilling services	$	2,556,758		$	2,695,493	$	(138,735	)	-5	%
Reimbursables (1)		77,278			73,959		3,319		4	%
Other		875			2,332		(1,457	)	-62	%
	$	2,634,911		$	2,771,784	$	(136,873	)	-5	%
Operating costs and expenses:
Contract drilling services	$	1,384,200		$	1,177,800	$	206,400		18	%
Reimbursables (1)		56,589			56,674		(85	)	0	%
Depreciation and amortization		647,142			528,011		119,131		23	%
Selling, general and administrative		90,262			91,094		(832	)	-1	%
Gain on contract extinguishments, net		(21,202	)		—		(21,202	)		**
		2,156,991			1,853,579		303,412		16	%
Operating income	$	477,920		$	918,205	$	(440,285	)	-48	%

Prior to the completion of the Spin-off, Noble and Paragon Offshore entered into a series of agreements to effect the separation and Spin-off and govern the relationship between the parties after the Spin-off.

~~(1)~~Master WeSeparation ~~record~~Agreement reimbursements from customers for out-of-pocket expenses as operating revenues and the related direct costs as operating expenses. Changes in the amount of these reimbursables generally do not have a material effect on our financial position, results of operations or cash flows.(“MSA”)

**The ~~Not~~general aterms ~~meaningful~~and ~~percentage~~conditions relating to the separation and Spin-off are set forth in the MSA. The MSA identifies the assets transferred, liabilities assumed and contracts assigned either to Paragon Offshore by us or by Paragon Offshore to us in the separation and describes when and how these transfers, assumptions and assignments would occur. The MSA provides for, among other things, Paragon Offshore’s responsibility for liabilities relating to its business and the responsibility of Noble for liabilities related to our, and in certain limited cases, Paragon Offshore’s business, in each case irrespective of when the liability arose. The MSA also contains indemnification obligations and ongoing commitments by us and Paragon Offshore.

33Employee Matters Agreement (“EMA”)

~~Table~~The ofEMA ~~Contents~~allocates liabilities and responsibilities between us and Paragon Offshore relating to employment, compensation and benefits and other employment related matters.

~~Operating~~Tax ~~Revenues.~~Sharing Decreased contract drilling services revenues for the current year as compared to the prior year was driven by reductions in both average dayrates and operating days. The 3 percent decrease in average dayrates reduced revenues by approximately $71 million, and the 3 percent decrease in operating days decreased revenues by an additional $68 million. Agreement

The ~~decrease~~tax insharing ~~contract~~agreement ~~drilling~~provides ~~services~~for ~~revenues~~the ~~primarily~~allocation ~~relates~~of totax ~~our jackups,~~liabilities ~~drillships~~ and ~~FPSO,~~benefits ~~which~~between ~~generated~~us ~~approximately~~and ~~$191~~Paragon ~~million,~~Offshore ~~$46 million~~ and ~~$34~~governs ~~million~~the ~~less~~parties’ ~~revenue,~~assistance ~~respectively,~~with intax-related ~~2011~~claims.

~~The~~Transition ~~decrease~~Services in jackup average dayrates of 12 percent resulted in a $135 million decrease in revenues from the prior year. The reduction in average dayrates was primarily from the contractual repricing of rigs in the Middle East, the North Sea, and Mexico for changes in market conditions in the global shallow water market. The 5 percent decline in jackup operating days resulted in a $56 million decline in revenues. The decrease in utilization primarily related to rigs coming off contract in Mexico and the Middle East during 2011, the majority of which did not return to work until the latter part of the year. Agreements

~~The~~Under ~~decrease~~two intransition ~~drillship~~services ~~revenue~~agreements, ~~was~~we ~~primarily~~agreed ~~driven~~to bycontinue, ~~reduced~~for ~~dayrates~~a limited period of 5time, ~~percent~~to ~~and~~provide anvarious 8interim ~~percent~~support ~~decrease~~services into ~~operating~~Paragon ~~days~~Offshore, ~~which~~and ~~resulted~~Paragon inOffshore ~~decreased~~agreed ~~revenues~~to ofprovide ~~$18~~various ~~million~~interim ~~and~~support ~~$28~~services ~~million~~to us, ~~respectively,~~ ~~from~~including ~~the~~providing ~~prior~~operational ~~year.~~and ~~The~~administrative ~~decrease~~support infor ~~drillship~~our ~~revenue~~remaining isBrazilian ~~primarily~~operations. ~~the~~As ~~result~~ of ~~increased~~May ~~downtime in Brazil~~2016, aswe ~~rigs~~no ~~entered~~longer ~~the~~had ~~shipyard~~any ~~for~~rigs ~~upgrades~~operating ~~and~~in ~~repairs~~Brazil.

~~Revenue~~ ~~from the Noble Seillean decreased $34 million as it was not under contract in 2011.~~ 32

~~The~~Contract ~~decreases~~Drilling inServices revenue for the above rig classes were partially offset by an increase in revenue of $132 million from our semisubmersibles. The increase was primarily attributable to a 9 percent increase in operating days and 3 percent increase in average dayrates, which contributed additional revenue in 2011 of $98 million and $34 million, respectively. The increase is primarily attributable to operations from the newbuilds, Noble Dave Beard and Noble Jim Day, which were added to the fleet in March 2010 and January 2011, respectively. Additionally, the Noble Driller was added to the fleet in July 2010 as part of the Frontier acquisition. Backlog

~~Operating~~We ~~Costs~~maintain ~~and~~a ~~Expenses.~~backlog ~~Contract~~(as ~~drilling~~defined ~~services operating~~below) ~~costs~~of ~~and~~commitments ~~expenses increased $206 million~~ for ~~the~~contract ~~current~~drilling ~~year as compared to the prior year~~services. The ~~rigs~~following ~~added~~table tosets ~~the~~forth, ~~fleet~~ as ~~part~~ of ~~the~~December 31, ~~Frontier~~2016, ~~acquisition and~~ the ~~Noble~~amount ~~Dave Beard and the Noble Jim Day added approximately $120 million~~ of ~~operating costs in the current year. Excluding the additional expenses related to these rigs,~~ our contract drilling ~~costs~~services ~~increased~~backlog ~~$86~~and ~~million in~~ the ~~current~~percent ~~year~~of ~~from~~available ~~the~~operating ~~prior~~days ~~year.~~committed This increase was primarily driven by a $22 million increase in maintenance and rig-related expenses, $20 million increase in mobilization costs, $18 million increase in labor costs, and an $11 million increase in safety and training costs. These cost increases were primarily for ~~our~~the ~~rigs returning,~~periods ~~or preparing to return, to work in Brazil and Mexico. Additionally, rotation costs and operations support costs increased $10 million and $5 million, respectively.~~ indicated:

Depreciation and amortization increased $119 million in 2011 over 2010 as a result of depreciation on newbuilds placed into service, rigs added to the fleet as part of the Frontier acquisition and additional depreciation related to other capital expenditures on our fleet since the beginning of 2010.



			Year Ending December 31,
	Total		2017			2018			2019			2020			2021-2023
	(In millions)
Contract Drilling Services Backlog
Semisubmersibles/Drillships⁽³⁾⁽⁵⁾	$	2,252	$	537		$	459		$	348		$	326		$	582
Jackups ⁽²⁾	1,027		468			285			159			115			—
Total ⁽¹⁾	$	3,279	$	1,005		$	744		$	507		$	441		$	582
Percent of Available Days Committed ⁽⁴⁾
Semisubmersibles/Drillships			33		%	29		%	22		%	21		%	13		%
Jackups			71		%	36		%	7		%	5		%	—		%
Total			52		%	32		%	15		%	13		%	7		%

34(1) Some of our drilling contracts provide the customer with certain early termination rights and, in very limited cases, these termination rights require minimal or no notice or financial penalties. No notifications of contract terminations have been received as of February 24, 2017.

~~Table~~(2) Our Saudi Aramco contract rates were adjusted downward for 2016. Given current market conditions and based on discussions with the customer, we do not expect the rates to return to the original contract rates. Instead, we expect the contract rates to be in the general range of ~~Contents~~the amended rates for 2016 through the end of each respective contract and the 2017 rates for the Noble Joe Beall and Noble Gene House were recently confirmed within this range. This December 31, 2016 backlog has been prepared assuming the reduced rates for 2016 apply for the remainder of the contract.

~~Other~~(3) As previously reported, three of our drilling contracts with Shell, the Noble Bully II, Noble Globetrotter I, and Noble Globetrotter II contain a dayrate adjustment mechanism that utilizes an average of market rates that match a set of distinct technical attributes and is subject to a modest discount, beginning on the fifth year anniversary of the contract and continuing every six months thereafter. On December 12, 2016 we amended those long-term contracts with Shell. As a result of the Amendments, each of the contracts now has a contractual dayrate floor. The contract amendments for the Noble Globetrotter I and Noble Globetrotter II provide a dayrate floor of $275,000 per day. The Noble Bully II contract contains a dayrate floor of $200,000 per day, plus daily operating expenses. The amendment also provided Shell the right to idle the Noble Bully II for up to one year and the Noble Globetrotter II for up to two years, each at a special stacking rate. Shell has exercised its right and beginning late December 2016 we idled the Noble Globetrotter II at a rate of $185,000 per day. We expect the Noble Bully II will be idled at a rate of $200,000 per day before May 1, 2017. Once the dayrate adjustment mechanism becomes effective and following any idle periods, the dayrate for these rigs will not be lower than the higher of (i) the contractual dayrate floor or (ii) the market rate as calculated under the adjustment mechanism. The impact to contract backlog from these amendments has been reflected in the table above, and the backlog calculation assumes that, after any idle period at the contractual stacking rate, each rig will work at their respective dayrate floor for the remaining contract term.

~~The~~(4) ~~following~~Percent ~~table~~of ~~sets~~available ~~forth~~days committed is calculated by dividing the total number of days our rigs are operating ~~revenues~~under ~~and~~contract for such period by the ~~operating~~product ~~costs~~of ~~and~~the ~~expenses~~number ~~for~~of our ~~other~~rigs ~~services~~and ~~for~~the ~~2011~~number ~~and~~of ~~2010~~calendar ~~(dollars~~days in ~~thousands):~~such period. Percentages take into account additional capacity from our newbuild rig that commenced operations during 2016.

						Change
	2011		2010			$			%
Operating revenues:
Labor contract drilling services	$	59,004	$	32,520		$	26,484			81	%
Reimbursables (1)		1,917		2,872			(955	)		-33	%
	$	60,921	$	35,392		$	25,529			72	%
Operating costs and expenses:
Labor contract drilling services	$	33,885	$	22,056		$	11,829			54	%
Reimbursables (1)		1,850		2,740			(890	)		-32	%
Depreciation and amortization		11,498		11,818			(320	)		-3	%
Selling, general and administrative		1,115		903			212			23	%
		48,348		37,517			10,831			29	%
Operating income	$	12,573	$	(2,125	)	$	14,698			-692	%

(5)

Noble and a subsidiary of Shell are involved in joint ventures that own and operate both the Noble Bully I and the Noble Bully II. Pursuant to these agreements, each party has an equal 50 percent share in both vessels. As of December 31, 2016, the combined amount of backlog for these rigs totals $646 million, all of which is included in backlog. Noble’s proportional interest in the backlog for these rigs totals $323 million.

~~(1)~~Our Wecontract ~~record~~drilling ~~reimbursements~~services ~~from~~backlog ~~customers~~reflects ~~for~~estimated ~~out-of-pocket~~future ~~expenses~~revenues asattributable ~~operating~~to ~~revenues~~both signed drilling contracts and ~~the~~letters ~~related~~of ~~direct~~intent ~~costs~~that aswe ~~operating~~expect ~~expenses.~~to ~~Changes~~result in ~~the~~binding ~~amount~~drilling contracts. A letter of ~~these~~intent ~~reimbursables~~is generally dosubject ~~not~~to ~~have~~customary conditions, including the execution of a ~~material~~definitive ~~effect~~drilling oncontract. It ~~our~~is ~~financial~~possible ~~position,~~that ~~results~~some customers that have entered into letters of ~~operations~~intent orwill ~~cash~~not ~~flows~~enter into signed drilling contracts. As of December 31, 2016, our contract drilling services backlog did not include any letters of intent.

~~Operating~~We ~~Revenues~~calculate ~~and~~backlog ~~Costs~~for any given unit and ~~Expenses.~~period ~~The~~by ~~increase~~multiplying inthe ~~both~~full ~~revenue~~contractual ~~and~~operating ~~expense~~dayrate ~~primarily~~for ~~relates~~such tounit by the ~~commencement~~number of adays ~~refurbishment~~remaining ~~project~~in ~~with~~the ~~our~~period ~~customer~~and, for the three rigs contracted with Shell mentioned above, ~~for~~utilize ~~one~~the ofidle ~~its rigs~~period and floor rates as described in Footnote (3) to bethe ~~operated~~Backlog ~~under~~table aabove. ~~labor~~The reported contract indrilling ~~Alaska,~~services ~~combined~~backlog ~~with~~does ~~operational~~not ~~increases~~include amounts representing revenues for mobilization, demobilization and ~~foreign~~contract ~~currency~~preparation, ~~fluctuations~~which inare ~~our~~not ~~Canadian~~expected ~~operations.~~to be

~~Other~~ ~~Income and Expenses~~ 33

~~Selling,~~significant ~~general~~to ~~and~~our ~~administrative expenses.~~contract ~~Overall~~drilling ~~selling~~services revenues, ~~general~~amounts ~~and~~constituting ~~administrative~~reimbursables ~~expenses~~from ~~were~~customers ~~consistent~~or ~~with~~amounts ~~2010~~attributable ~~as a $6 million increase primarily related~~ to ~~ongoing~~uncommitted ~~legal~~option ~~and~~periods ~~tax~~under ~~expenses~~drilling incontracts ~~the~~or ~~current~~letters ~~year was offset by a $6 million decrease resulting from the absence~~ of ~~costs related to our completed FCPA investigation in the prior year~~intent.

~~Interest~~The ~~Expense,~~amount ~~net~~ of ~~amount capitalized.~~actual ~~Interest~~revenues ~~expense,~~earned ~~net~~and ofthe ~~amount~~actual ~~capitalized,~~periods ~~increased~~during ~~$46~~which ~~million~~revenues inare ~~2011~~earned ~~from~~may ~~2010.~~be ~~The~~materially ~~increase~~different isthan athe ~~result~~backlog ofamounts ~~$1.25~~and ~~billion~~backlog ofperiods ~~debt~~set ~~issued~~forth in ~~July~~the ~~2010~~table above due to various factors, ~~which~~including, ~~was~~but ~~used~~not limited to, ~~partially~~shipyard ~~fund~~and maintenance projects, unplanned downtime, the ~~Frontier~~operation ~~acquisition~~of market benchmarks for dayrate resets, ~~$1.1~~achievement ~~billion~~ of ~~debt~~bonuses, ~~issued~~weather conditions, reduced standby or mobilization rates and other factors that result in ~~February~~applicable ~~2011,~~dayrates ~~which~~lower ~~was~~than ~~primarily~~the ~~used~~full tocontractual ~~repay~~operating dayrate. In addition, amounts included in the ~~outstanding~~backlog ~~balance~~may onchange because drilling contracts may be varied or modified by mutual consent or customers may exercise early termination rights contained in some of our ~~revolving~~drilling ~~credit~~contracts ~~facility~~or ~~and~~decline to ~~repay~~enter into a drilling contract after executing a letter of intent. As a result, our ~~portion~~backlog as of ~~outstanding~~any ~~debt~~particular ~~under~~date may not be indicative of our actual operating results for the ~~joint~~periods ~~venture~~for ~~credit~~which ~~facilities~~the backlog is calculated. Please read Part I, ~~and~~Item 1A, “Risk Factors—We can provide no assurance that our current ~~year~~backlog ~~drawdowns~~of oncontract ~~the credit~~drilling ~~facilities.~~revenue will be ultimately realized.”

~~Income~~As ~~Tax~~of ~~Provision.~~December 31, ~~Our income tax provision decreased $70 million in 2011 compared to 2010 primarily due to a reduction in pre-tax earnings~~2016, ~~which~~Shell ~~was~~and ~~partially~~Statoil ~~offset~~represented ~~by a higher effective tax rate. Pre-tax earnings decreased~~ approximately 5269 percent inand ~~2011~~18 ~~compared to 2010 resulting in a reduction of approximately $75 million in income tax expense. The higher effective tax rate, which was 16.7~~ percent ~~in 2011 compared to 15.6 percent in 2010, increased income tax expense by approximately $5 million. The increase in the effective tax rate was a result~~ of ~~a change in~~ our ~~geographic~~ ~~revenue mix primarily resulting from drilling restrictions in the U.S. Gulf of Mexico~~backlog, ~~partially offset by the resolution of discrete tax items~~respectively.

~~LIQUIDITY~~RESULTS ~~AND~~OF ~~CAPITAL RESOURCES~~ OPERATIONS

~~Overview~~2016 Compared to 2015

Net ~~cash~~loss from ~~operating~~continuing ~~activities~~operations inattributable ~~2012~~to ~~was~~Noble-UK ~~$1.4~~for ~~billion,~~2016 ~~which~~was ~~compared to~~ $~~740~~930 million, ~~and~~or $13.682 ~~billion~~per indiluted ~~2011 and 2010~~share, ~~respectively.~~ ~~The~~on ~~increase in net cash from~~ operating ~~activities~~revenues inof ~~2012~~$2.3 billion, compared to ~~2011 was primarily attributable to a significant increase in~~ net income ~~coupled~~from ~~with~~continuing ~~favorable~~operations ~~changes~~for in2015 ~~deferred taxes and other current liabilities, partially offset by an increase in accounts receivable. We had working capital~~ of $~~394~~511 million ~~and $232 million at December 31~~, ~~2012~~or ~~and 2011, respectively~~$2.06 ~~Our~~per ~~total~~diluted ~~debt as a percentage of total debt plus equity increased to 35.3 percent at December 31~~share, ~~2012~~on ~~from~~operating ~~33.5~~revenues ~~percent at December 31, 2011, primarily as a result~~ of ~~our~~ $13.24 billion ~~senior notes offering in February 2012, partially offset by a net reduction in indebtedness outstanding on our credit facilities and commercial paper program during the year~~.

35As a result of Noble-UK conducting all of its business through Noble-Cayman and its subsidiaries, the financial position and results of operations for Noble-Cayman, and the reasons for material changes in the amount of revenue and expense items between 2016 and 2015, would be the same as the information presented below regarding Noble-UK in all material respects, except operating loss for Noble-Cayman for the year ended December 31, 2016 and operating income for the year ended December 31, 2015 was $30 million lower and $29 million higher, respectively, than operating loss and income for Noble-UK for the same periods. The operating income or loss difference is primarily a result of executive costs directly attributable to Noble-UK for operations support and stewardship related services.

~~Table~~Rig ofUtilization, ~~Contents~~Operating Days and Average Dayrates

~~Our~~Operating ~~principal~~results ~~sources~~for ofour ~~capital~~contract indrilling ~~2012~~services ~~were~~segment ~~the~~are ~~$1.4~~dependent ~~billion~~on inthree ~~cash~~primary ~~generated~~metrics: ~~from operating~~rig ~~activities~~utilization, ~~noted~~operating ~~above~~days and ~~our $1~~dayrates.2 ~~billion~~The ~~senior~~following ~~notes~~table ~~offering~~sets inforth ~~February 2012. Cash generated during~~ the ~~current~~average ~~year~~rig ~~was~~utilization, ~~primarily~~operating ~~used~~days ~~to fund our capital expenditure program~~ and toaverage ~~repay~~dayrates ~~borrowings~~for ~~outstanding under~~ our ~~credit facilities~~rig ~~and~~fleet ~~commercial~~for ~~paper~~2016 ~~program.~~and 2015:

Our currently anticipated cash flow needs, both in the short-term and long-term, include the following:



	Average Rig Utilization ⁽¹⁾				Operating Days ⁽²⁾				Average Dayrates
	2016		2015		2016	2015	% Change		2016			2015			% Change
Jackups	83	%	85	%	3,966	3,967	—	%	$	126,279	⁽³⁾	$	162,348		(22	)%
Semisubmersibles	22	%	63	%	649	1,876	(65	)%	256,122			445,320		⁽⁶⁾	(42	)%
Drillships	82	%	100	%	2,408	3,257	(26	)%	654,074		⁽⁴⁾	547,265		⁽⁵⁾	20	%
Total	66	%	84	%	7,023	9,100	(23	)%	$	319,256	⁽⁷⁾	$	358,423	⁽⁷⁾	(11	)%

•(1) ~~committed~~We ~~capital~~define

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