John:

Claudio put together a spreadsheet for cheking the change on a composed 
jackup index against the change on individual categories of jackups and 
semis. He did not weighted the index because we think we will benefit from a 
simpler index price calculation by taking the straight average. 

The results show a good R-square between the general index and individual 
jackup categories - on the range of 0.7 - 0.8. Only one category displayed a 
poor R-square - about 0.3. For semis of 4tht and 5th generation, however, we 
noticed a degradation on the hedge effectiveness - R-squares about 0.2 - 0.3. 
You may verify each regression by changing the choice cell (AX2 on Analysis). 

Claudio is also starting to analyze how gas and crude past moving averages, 
12 month swaps on gas / crude, and rigs utilization explains the daily rates. 
We will forward the results as soon as we finish. 



Please call me or Claudio if you have questions.
Paulo Issler