<SUBMISSION>
<ACCESSION-NUMBER>0000950129-04-005157
<TYPE>8-K
<PUBLIC-DOCUMENT-COUNT>2
<PERIOD>20040726
<ITEMS>12
<ITEMS>7
<FILING-DATE>20040727
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>NABORS INDUSTRIES LTD
<CIK>0001163739
<ASSIGNED-SIC>1381
<IRS-NUMBER>980363970
<STATE-OF-INCORPORATION>D0
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>8-K
<ACT>34
<FILE-NUMBER>000-49887
<FILM-NUMBER>04932284
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>2ND FLOOR INT'L TRADING CENTER
<STREET2>WARRENS, P.O. BOX 905E
<CITY>ST. MICHAEL BARBADOS
<STATE>D0
<ZIP>0000
<PHONE>2464219471
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>2ND FLOOR INT'L TRADING CENTER
<STREET2>WARRENS, P.O. BOX 905E
<CITY>ST. MICHAEL BARBADOS
<STATE>D0
<ZIP>0000
</MAIL-ADDRESS>
</FILER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>h16999e8vk.txt
<DESCRIPTION>NABORS INDUSTRIES LTD - DATE OF REPORT: JULY 26, 2004
<TEXT>
<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 8-K

                                 CURRENT REPORT

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


         Date of Report (Date of earliest event reported): July 26, 2004

                             NABORS INDUSTRIES LTD.
             (Exact name of registrant as specified in its charter)


          Bermuda                       000-49887                 980363970
(State or Other Jurisdiction           (Commission              (IRS Employer
     of Incorporation)                 File Number)          Identification No.)


2nd Fl. International Trading Centre
Warrens
PO Box 905E
St. Michael, Barbados                                                N/A
(Address of Principal Executive Offices)                          (Zip Code)

Registrant's telephone number, including area code: (246) 421-9471

                                       N/A
          (Former name or former address, if changed since last report)


<PAGE>


ITEM 7.  FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.

         (c)  Exhibits

         Exhibit No.             Description
         -----------             -----------

         99.1                    Press Release issued by Nabors Industries Ltd.
                                 on July 26, 2004.

ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION

                  On July 26, 2004, the Company issued a press release
         announcing its results of operations for the three and six month
         periods ending June 30, 2004. A copy of that release is furnished
         herewith as Exhibit 99.1 in accordance with General Instruction B.6 to
         Form 8-K.

                  The press release furnished as an exhibit to this report
         includes forward-looking statements within the meaning of the
         Securities Act of 1933 and the Securities Exchange Act of 1934. Such
         forward-looking statements are subject to certain risks and
         uncertainties, as disclosed by the Company from time to time in its
         filings with the Securities and Exchange Commission. As a result of
         these factors, the Company's actual results may differ materially from
         those indicated or implied by such forward-looking statements.

                  The Company also presented in the press release its adjusted
         income (loss) derived from operating activities for all periods
         presented in the release, which is a "non-GAAP" financial measure under
         Regulation G. The components of adjusted (loss) income derived from
         operating activities are computed by using amounts which are determined
         in accordance with accounting principles generally accepted in the
         United States of America (GAAP). Adjusted income (loss) derived from
         operating activities is computed by subtracting direct costs, general
         and administrative expenses, depreciation and amortization, and
         depletion expense from Operating revenues and then adding Earnings from
         unconsolidated affiliates. As part of our press release information we
         have provided a reconciliation of adjusted income (loss) derived from
         operating activities to income before income taxes, which is its
         nearest comparable GAAP financial measure.

                  The Company included its adjusted income (loss) derived from
         operating activities in the release because management evaluates the
         performance of our business units and the consolidated company based on
         several criteria, including adjusted income (loss) derived from
         operating activities, and because it believes this financial measure is
         an accurate reflection of the ongoing profitability of our Company.



<PAGE>


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


                                    NABORS INDUSTRIES LTD.


Date: July 27, 2004                 By: /s/ Daniel McLachlin
                                       -----------------------------------------
                                       Daniel McLachlin
                                       Vice President-Administration & Secretary



<PAGE>


                                  EXHIBIT INDEX


Exhibit No.               Description
-----------               -----------

99.1                      Press Release issued by Nabors Industries Ltd. on
                          July 26, 2004.




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>h16999exv99w1.txt
<DESCRIPTION>PRESS RELEASE - ANNOUNCES RESULTS OF OPERATIONS
<TEXT>
<PAGE>


                                                                    EXHIBIT 99.1

--------------------------------------------------------------------------------
(NABORS INDUSTRIES LOGO)                                            NEWS RELEASE

--------------------------------------------------------------------------------


   NABORS 2Q04 EPS $0.30 VS. $0.19 IN 2Q03 ON IMPROVED NORTH AMERICAN BUSINESS

ST. MICHAEL, BARBADOS, JULY 26, 2004, NABORS INDUSTRIES LTD. (AMEX: NBR), today
announced its results for the second quarter and six months ended June 30, 2004.
Adjusted income derived from operating activities(1) was $46.7 million for the
current quarter compared to $38.0 million in the second quarter of last year and
$85.1 million in the first quarter of this year. Net income was $46.3 million
($0.30 per diluted share) for the current quarter compared to $29.0 million
($0.19 per diluted share) in the prior year quarter and $71.7 million ($0.46 per
diluted share) in the first quarter of this year. Operating revenues and
earnings from unconsolidated affiliates were $531.9 million in the current
quarter compared to $433.9 million in the prior year quarter and $596.8 million
in the first quarter of this year. For the six months ended June 30, 2004,
adjusted income derived from operating activities was $131.7 million compared to
$94.0 million in the first six months of 2003. Net income for the first six
months of 2004 was $118.1 million ($0.76 per diluted share) compared to $77.1
million ($0.50 per diluted share) in the first six months of 2003. Revenues and
earnings from unconsolidated affiliates for the first six months were $1,128.7
million compared to $889.7 million for the first six months of 2003.

Gene Isenberg, Nabors' Chairman and Chief Executive Officer commented on the
results, "I am quite pleased with the substantial year-over-year improvements in
our results. This came primarily from higher utilization and pricing in our U.S.
Lower 48 Land Drilling, Canadian, U.S. offshore and U.S. Land well-servicing
operations."

"Comparing to the sequential first quarter of 2004, we posted sizeable
improvements in both our U.S. Lower 48 Land Drilling and well-servicing
businesses while results were essentially flat in our U.S. offshore and
international units. Internationally, we performed relatively well despite the
multiple elements of unexpected costs incurred during the quarter as previously
announced. Canada was seasonally down with the spring thaw, but was
substantially improved over the same period of 2003 with higher rig utilization
and pricing reflecting the continuing strength in that market. Alaska was down
as we anticipated with the windup of the winter exploration activity and a
generally weak market. Oil and gas and other operating income was down but in
line with our revised expectations which included $2.1 million in dry hole
expense."

--------
(1) Adjusted income derived from operating activities is computed by:
subtracting direct costs, general and administrative expenses, depreciation and
amortization, and depletion expense from Operating revenues and then adding
Earnings from unconsolidated affiliates. Such amounts should not be used as a
substitute to those amounts reported under accounting principles generally
accepted in the United States of America (GAAP). However, management evaluates
the performance of our business units and the consolidated company based on
several criteria, including adjusted income derived from operating activities,
because it believes that this financial measure is an accurate reflection of the
ongoing profitability of our company. A reconciliation of this non-GAAP measure
to income before income taxes, which is a GAAP measure, is provided within the
table set forth immediately following the heading "Segment Reporting."


<PAGE>

"Our outlook for the balance of the year continues to be quite positive as all
of our businesses except Alaska anticipate improved results in the second half.
We expect the largest improvement to come from our U.S. Lower 48 Land Drilling
unit where higher rig activity and pricing combined with reduced expenses
related to rig mobilizations and start-ups should generate increasingly higher
results. Our international business should post the next most meaningful
improvement with the unusual costs of the second quarter mostly behind us, and
anticipated increases in rig activity and average per rig margins. Our U.S.
offshore unit's results should also show significant improvement over the
balance of the year with the contribution of two new MODS deepwater platform
rigs which commenced late in the second quarter. Likewise, U.S. Land well
servicing should benefit from continuing high activity levels and the
contribution of recent pricing improvements. Canada is rapidly emerging from its
second quarter seasonal trough with a much higher rig count and stronger rates,
which should make the second half equal to or slightly better than first half.

"With each quarter we continue to see constructive trends in place that support
our belief that the North American gas markets will require higher levels of
drilling for an extended period to meet the supply challenges. While there is
some degree of uncertainty as to the precise magnitude and timing of incremental
rig pricing and utilization, we are very confident of our strategy over the
long-term in both our North American and international markets. Our
international business continues to demonstrate high potential with increasing
activity both currently and prospectively, particularly in the Middle East and
North African regions."

The Nabors companies own and operate almost 600 land drilling and approximately
950 land workover and well-servicing rigs worldwide. Offshore, Nabors operates
45 platform rigs, 19 jack-up units, and three barge rigs in the United States
and multiple international markets. Nabors markets 31 marine transportation and
support vessels, primarily in the U.S. Gulf of Mexico. In addition, Nabors
manufactures top drives and drilling instrumentation systems and provides
comprehensive oilfield hauling, engineering, civil construction, logistics and
facilities maintenance, and project management services. Nabors participates in
most of the significant oil, gas and geothermal markets in the world.

The information above includes forward-looking statements within the meaning of
the Securities Act of 1933 and the Securities Exchange Act of 1934. Such
forward-looking statements are subject to certain risks and uncertainties, as
disclosed by Nabors from time to time in its filings with the Securities and
Exchange Commission. As a result of these factors, Nabors' actual results may
differ materially from those indicated or implied by such forward-looking
statements.


--------------------------------------------------------------------------------

For further information, please contact Dennis A. Smith, Director of Corporate
Development of Nabors Corporate Services, Inc. at (281) 775-8038. To request
Investor Materials, call our corporate headquarters in St. Michael, Barbados at
(246) 421-9471 or via email at dan.mclachlin@nabors.com. Nabors will conduct a
conference call to discuss the quarter's results and the near-term outlook,
tomorrow July 27, 2004, at 11:00 a.m. Eastern Daylight Time. The call can be
accessed on our website at www.nabors.com, or through First Call at
www.firstcallevents.com.

<PAGE>
                     NABORS INDUSTRIES LTD. AND SUBSIDIARIES
                        CONSOLIDATED STATEMENTS OF INCOME
                                   (UNAUDITED)

<Table>
<Caption>


                                                                    THREE MONTHS ENDED                     SIX MONTHS ENDED
                                                         ----------------------------------------     ---------------------------
                                                                 JUNE 30,              MARCH 31,               JUNE 30,
                                                         -------------------------     ----------     ---------------------------

(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)                   2004            2003           2004          2004              2003
                                                         ----------     ----------     ----------     ----------       ----------
<S>                                                      <C>            <C>            <C>            <C>              <C>
Revenues and other income:
   Operating revenues                                    $  530,715     $  432,552     $  592,981     $1,123,696       $  882,389
   Earnings from unconsolidated affiliates                    1,153          1,359          3,822          4,975            7,262
   Interest and dividend income                               7,879          6,998          6,505         14,384           14,691
   Other income, net                                          6,907             23          4,419         11,326               47
                                                         ----------     ----------     ----------     ----------       ----------
      Total revenues and other income                       546,654        440,932        607,727      1,154,381          904,389
                                                         ----------     ----------     ----------     ----------       ----------

Costs and other deductions:
   Direct costs                                             368,941        298,791        390,040        758,981          603,351
   General and administrative expenses                       45,441         40,483         45,599         91,040           81,728
   Depreciation and amortization                             60,843         55,882         60,488        121,331          109,460
   Depletion                                                  9,977            770         15,610         25,587            1,118
   Interest expense                                          11,387         18,644         15,859         27,246           38,714
                                                         ----------     ----------     ----------     ----------       ----------
      Total costs and other deductions                      496,589        414,570        527,596      1,024,185          834,371
                                                         ----------     ----------     ----------     ----------       ----------

Income before income taxes                                   50,065         26,362         80,131        130,196           70,018
                                                         ----------     ----------     ----------     ----------       ----------

Income tax expense (benefit):
  Current                                                     6,391          3,226          4,205         10,596            7,286
  Deferred                                                   (2,674)        (5,883)         4,209          1,535          (14,344)
                                                         ----------     ----------     ----------     ----------       ----------
    Total income tax expense (benefit)                        3,717         (2,657)         8,414         12,131           (7,058)
                                                         ----------     ----------     ----------     ----------       ----------

Net income                                               $   46,348     $   29,019     $   71,717     $  118,065       $   77,076
                                                         ==========     ==========     ==========     ==========       ==========

Earnings per share (1):
   Basic                                                 $      .31     $      .20     $      .48     $      .80       $      .53
   Diluted                                               $      .30     $      .19     $      .46     $      .76       $      .50

Weighted-average number of
 common shares outstanding (1):
   Basic                                                    148,866        146,382        147,984        148,425          146,045
                                                         ----------     ----------     ----------     ----------       ----------
   Diluted                                                  155,234        153,359        163,110        163,417          160,487
                                                         ----------     ----------     ----------     ----------       ----------

Adjusted income derived from operating activities (2)    $   46,666     $   37,985     $   85,066     $  131,732       $   93,994
                                                         ==========     ==========     ==========     ==========       ==========
</Table>


(1)    See "Computation of Earnings Per Share" included herein as a separate
       schedule.

(2)    Adjusted income derived from operating activities is computed by:
       subtracting direct costs, general and administrative expenses,
       depreciation and amortization, and depletion expense from Operating
       revenues and then adding Earnings from unconsolidated affiliates. Such
       amounts should not be used as a substitute to those amounts reported
       under accounting principles generally accepted in the United States of
       America (GAAP). However, management evaluates the performance of our
       business units and the consolidated company based on several criteria,
       including adjusted income derived from operating activities, because it
       believes that this financial measure is an accurate reflection of the
       ongoing profitability of our company. A reconciliation of this non-GAAP
       measure to income before income taxes, which is a GAAP measure, is
       provided within the table set forth immediately following the heading
       "Segment Reporting".




<PAGE>


                    NABORS INDUSTRIES LTD. AND SUBSIDIARIES
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                                  (UNAUDITED)


<Table>
<Caption>

                                                       JUNE 30,         MARCH 31,      DECEMBER 31,
(IN THOUSANDS, EXCEPT RATIOS)                            2004             2004            2003
                                                      ----------       ----------      ------------
<S>                                                   <C>              <C>              <C>
ASSETS
Current assets:
Cash and marketable securities                        $  787,615       $  906,860       $  919,673
Accounts receivable, net                                 411,034          470,763          410,487
Other current assets                                     180,054          206,530          185,487
                                                      ----------       ----------       ----------
     Total current assets                              1,378,703        1,584,153        1,515,647
Marketable securities                                    432,152          634,464          612,417
Property, plant and equipment, net                     3,117,872        3,021,539        2,990,792
Goodwill, net                                            311,343          314,031          315,627
Other long-term assets                                   210,598          184,369          168,209
                                                      ----------       ----------       ----------
     Total assets                                     $5,450,668       $5,738,556       $5,602,692
                                                      ==========       ==========       ==========

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt                     $    4,147       $  300,988       $  299,385
Other current liabilities                                315,500          314,171          298,988
                                                      ----------       ----------       ----------
     Total current liabilities                           319,647          615,159          598,373
Long-term debt                                         1,989,568        1,997,456        1,985,553
Other long-term liabilities                              497,351          515,589          528,491
                                                      ----------       ----------       ----------
     Total liabilities                                 2,806,566        3,128,204        3,112,417
Shareholders' equity                                   2,644,102        2,610,352        2,490,275
                                                      ----------       ----------       ----------
     Total liabilities and shareholders' equity       $5,450,668       $5,738,556       $5,602,692
                                                      ==========       ==========       ==========

Total cash and marketable securities                  $1,219,767       $1,541,324       $1,532,090

Working capital                                       $1,059,056       $  968,994       $  917,274

Funded debt to capital ratio:
    - Gross                                             0.43 : 1         0.47 : 1         0.48 : 1
    - Net of cash and marketable securities             0.23 : 1         0.22 : 1         0.23 : 1
Interest coverage ratio:                                 9.5 : 1          8.0 : 1          6.8 : 1
</Table>



<PAGE>
                    NABORS INDUSTRIES LTD. AND SUBSIDIARIES
                               SEGMENT REPORTING
                                  (UNAUDITED)

The following tables set forth certain information with respect to our
reportable segments and rig activity:

<Table>
<Caption>

                                                            THREE MONTHS ENDED                             SIX MONTHS ENDED
                                            -------------------------------------------------        ------------------------------
                                                       JUNE 30,                    MARCH 31,                   JUNE 30,
                                            ------------------------------        -----------        ------------------------------

(IN THOUSANDS, EXCEPT RIG ACTIVITY)            2004                2003              2004                2004               2003
                                            -----------        -----------        -----------        -----------        -----------
<S>                                         <C>                <C>                <C>                <C>                <C>
Reportable segments:
Operating revenues and Earnings from
  unconsolidated affiliates:
    Contract Drilling: (1)
      U.S. Lower 48 Land Drilling           $   172,049        $   114,118        $   153,368        $   325,417        $   204,207
      U.S. Land Well-servicing                   88,162             81,504             79,479            167,641            158,164
      U.S. Offshore                              31,556             24,680             31,321             62,877             46,394
      Alaska                                     19,701             30,446             29,337             49,038             66,414
      Canada                                     61,905             49,836            138,766            200,671            150,624
      International                             107,185             96,599            102,987            210,172            183,790
                                            -----------        -----------        -----------        -----------        -----------
       Subtotal Contract Drilling (2)           480,558            397,183            535,258          1,015,816            809,593

    Oil and Gas (3)                              14,173              2,487             21,126             35,299              4,086
    Other Operating Segments (4) (5)             52,740             46,572             55,938            108,678            101,761
    Other reconciling items (6)                 (15,603)           (12,331)           (15,519)           (31,122)           (25,789)
                                            -----------        -----------        -----------        -----------        -----------
      Total                                 $   531,868        $   433,911        $   596,803        $ 1,128,671        $   889,651
                                            ===========        ===========        ===========        ===========        ===========

Adjusted income (loss) derived
 from operating activities: (7)
 Contract Drilling:
   U.S. Lower 48 Land Drilling              $    12,971        $     3,858        $     8,568        $    21,539        $       (79)
   U.S. Land Well-servicing                      14,394             13,307              9,733             24,127             22,952
   U.S. Offshore                                  4,796                530              4,817              9,613             (3,440)
   Alaska                                         3,756             10,361              7,210             10,966             25,688
   Canada                                         2,851             (1,631)            43,272             46,123             24,389
   International                                 18,753             19,994             18,591             37,344             36,730
                                            -----------        -----------        -----------        -----------        -----------
    Subtotal Contract Drilling                   57,521             46,419             92,191            149,712            106,240

 Oil and Gas                                        896              1,642              4,506              5,402              2,661
 Other Operating Segments                        (2,106)              (450)              (431)            (2,537)             5,187
 Other reconciling items (8)                     (9,645)            (9,626)           (11,200)           (20,845)           (20,094)
                                            -----------        -----------        -----------        -----------        -----------
   Total                                         46,666             37,985             85,066            131,732             93,994

Interest expense                                (11,387)           (18,644)           (15,859)           (27,246)           (38,714)
Interest and dividend income                      7,879              6,998              6,505             14,384             14,691
Other income, net                                 6,907                 23              4,419             11,326                 47
                                            -----------        -----------        -----------        -----------        -----------
Income before income taxes                  $    50,065        $    26,362        $    80,131        $   130,196        $    70,018
                                            ===========        ===========        ===========        ===========        ===========

Rig activity:
Rig years: (9)
   U.S. Lower 48 Land Drilling                    193.4              136.8              175.2              184.4              123.0
   U.S. Offshore                                   15.5               15.0               13.8               14.6               14.2
   Alaska                                           6.7                9.1                7.8                7.2                8.9
   Canada                                          25.8               23.4               63.2               44.5               41.0
   International (10)                              65.6               59.8               65.0               65.3               58.4
                                            -----------        -----------        -----------        -----------        -----------
      Total rig years                             307.0              244.1              325.0              316.0              245.5
                                            ===========        ===========        ===========        ===========        ===========
Rig hours: (11)
   U.S. Land Well-servicing                     287,350            281,810            275,148            562,498            555,323
   Canada Well-servicing                         67,873             46,458            117,596            185,469            139,160
                                            -----------        -----------        -----------        -----------        -----------
      Total rig hours                           355,223            328,268            392,744            747,967            694,483
                                            ===========        ===========        ===========        ===========        ===========
</Table>

(1)    These segments include our drilling, workover and well-servicing
       operations, on land and offshore.

(2)    Includes Earnings from unconsolidated affiliates, accounted for by the
       equity method, of $1.0 million, $1.0 million and $1.2 million for the
       three months ended June 30, 2004 and 2003 and March 31, 2004,
       respectively, and $2.2 million and $1.9 million for the six months ended
       June 30, 2004 and 2003, respectively.

(3)    Represents our oil and gas exploration, development and production
       operations.

(4)    Includes our marine transportation and supply services, drilling
       technology and top drive manufacturing, directional drilling, rig
       instrumentation and software, and construction and logistics operations.


<PAGE>

(5)    Includes Earnings from unconsolidated affiliates, accounted for by the
       equity method, of $.1 million, $.4 million and $2.6 million for the
       three months ended June 30, 2004 and 2003 and March 31, 2004,
       respectively, and $2.8 million and $5.4 million for the six months ended
       June 30, 2004 and 2003, respectively.

(6)    Represents the elimination of inter-segment transactions.

(7)    Adjusted income (loss) derived from operating activities is computed by:
       subtracting direct costs, general and administrative expenses,
       depreciation and amortization, and depletion expense from Operating
       revenues and then adding Earnings from unconsolidated affiliates. Such
       amounts should not be used as a substitute to those amounts reported
       under GAAP. However, management evaluates the performance of our business
       units and the consolidated company based on several criteria, including
       adjusted income (loss) derived from operating activities, because it
       believes that this financial measure is an accurate reflection of the
       ongoing profitability of our company. A reconciliation of this non-GAAP
       measure to income before income taxes, which is a GAAP measure, is
       provided within the table set forth immediately following the heading
       "Segment Reporting".

(8)    Represents the elimination of inter-segment transactions and unallocated
       corporate expenses.

(9)    Excludes well-servicing rigs, which are measured in rig hours. Rig years
       represents a measure of the number of equivalent rigs operating during a
       given period. For example, one rig operating 182.5 days during a 365-day
       period represents 0.5 rig years.

(10)   International rig years include our equivalent percentage ownership of
       rigs owned by unconsolidated affiliates which totaled 4.0 years during
       each of the three month periods ended June 30, 2004 and 2003, and March
       31, 2004 and 8.0 years for each of the six month periods ended June 30,
       2004 and 2003.

(11)   Rig hours represents the number of hours that our well-servicing rig
       fleet operated during the period.



                     NABORS INDUSTRIES LTD. AND SUBSIDIARIES

                        COMPUTATION OF EARNINGS PER SHARE
                                   (UNAUDITED)

A reconciliation of the numerators and denominators of the basic and diluted
earnings per share computations is as follows:

<Table>
<Caption>

                                                                          THREE MONTHS ENDED            SIX MONTHS ENDED
                                                                ----------------------------------     ---------------------
                                                                        JUNE 30,          MARCH 31,           JUNE 30,
                                                                ---------------------     --------     ---------------------

(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)                          2004         2003         2004         2004         2003
                                                                --------     --------     --------     --------     --------
<S>                                                             <C>          <C>          <C>          <C>          <C>
Net income (numerator):
   Net income - basic                                           $ 46,348     $ 29,019     $ 71,717     $118,065     $ 77,076
   Add interest expense on assumed conversion of our
      zero coupon convertible/exchangeable senior
      debentures/notes, net of tax:
        $825 million due 2020 (1)                                     --           --           --           --        3,639
        $1.381 billion due 2021 (2)                                   --           --        3,081        6,180           --
        $700 million due 2023 (3)                                     --           --           --           --           --
                                                                --------     --------     --------     --------     --------
   Adjusted net income - diluted                                $ 46,348     $ 29,019     $ 74,798     $124,245     $ 80,715
                                                                --------     --------     --------     --------     --------

   Earnings per share:
     Basic                                                      $    .31     $    .20     $    .48     $    .80     $    .53
     Diluted                                                    $    .30     $    .19     $    .46     $    .76     $    .50

Shares (denominator):
   Weighted average number of shares outstanding - basic (4)     148,866      146,382      147,984      148,425      146,045
   Net effect of dilutive stock options and warrants based
      on the treasury stock method                                 6,368        6,977        6,635        6,501        6,783
   Assumed conversion of our zero coupon
      convertible/exchangeable senior debentures/notes:
        $825 million due 2020 (1)                                     --           --           --           --        7,659
        $1.381 billion due 2021 (2)                                   --           --        8,491        8,491           --
        $700 million due 2023 (3)                                     --           --           --           --           --
                                                                --------     --------     --------     --------     --------
   Weighted average number of shares outstanding - diluted       155,234      153,359      163,110      163,417      160,487
                                                                --------     --------     --------     --------     --------
</Table>


(1)    Diluted earnings per share for the six months ended June 30, 2003
       reflects the assumed conversion of our $825 million zero coupon
       convertible senior debentures, as the conversion in the period would have
       been dilutive. For the three months ended June 30, 2003, the
       weighted-average number of shares oustanding-diluted excludes 7.2 million
       potentially dilutive shares issuable upon the conversion of our $825
       million zero coupon convertible senior debentures because the inclusion
       of such shares would have been anti-dilutive, given the level of net
       income for that quarter. We redeemed for cash the remaining outstanding
       principal amount of our $825 million zero coupon convertible senior
       debentures on June 20, 2003 and therefore these debentures did not impact
       the calculation of diluted earnings per share for the three and six
       months ended June 30, 2004 or the three months ended March 31, 2004.

<PAGE>
(2)    Diluted earnings per share for the six months ended June 30, 2004 and the
       three months ended March 31, 2004 reflects the assumed conversion of our
       $1.381 billion zero coupon convertible senior debentures, as the
       conversion in those periods would have been dilutive. For the three
       months ended June 30, 2004 and 2003 and the six months ended June 30,
       2003, the weighted-average number of shares outstanding-diluted excluded
       8.5 million potentially dilutive shares issuable upon the conversion of
       our $1.381 billion zero coupon convertible senior debentures because the
       inclusion of such shares would have been anti-dilutive, given the level
       of net income for that period. Net income for the three months ended
       June 30, 2004 and 2003 and the six months ended June 30, 2003 excluded
       the related add-back of interest expense, net of tax, of $3.1 million,
       $3.0 million and $6.0 million, respectively, for these debentures. These
       shares would have been dilutive and therefore included in the calculation
       of the weighted-average number of shares outstanding-diluted had diluted
       earnings per share been at or above $.37, $.36 and $.71 for the three
       months ended June 30, 2004 and 2003 and six months ended June 30, 2003,
       respectively.

(3)    Diluted earnings per share for the three months ended June 30, 2004 and
       2003 and March 31, 2004 and the six months ended June 30, 2004 and 2003
       excludes approximately 10.0 million potentially dilutive shares initially
       issuable upon the exchange of our $700 million zero coupon exchangeable
       senior notes due 2023. Such shares are contingently exchangeable under
       certain circumstances and would only be included in the calculation of
       the weighted-average number of shares outstanding-diluted if any of
       those criteria were met. Such criteria were not met during the three
       months ended June 30, 2004 and 2003 and March 31, 2004 and the six months
       ended June 30, 2004 and 2003. Based on the initial exchange price per
       share, these notes would be exchangeable for our common shares if the
       closing sale price per share of Nabors' common shares for at least 20
       trading days during the period of 30 consecutive trading days ending on
       the last trading day of the previous calendar quarter is greater than or
       equal to $84.12 for all calendar quarters ending on or before June 30,
       2008, and $77.11 for all calendar quarters thereafter.

(4)    Includes the following weighted-average number of common shares of Nabors
       and weighted-average number of exchangeable shares of Nabors Exchangeco,
       respectively: 148.6 million and .3 million shares for the three months
       ended June 30, 2004; 145.9 million and .5 million shares for the three
       months ended June 30, 2003; 147.6 million and .4 million shares for the
       three months ended March 31, 2004; 148.1 million and .3 million shares
       for the six months ended June 30, 2004; and 145.5 million and .5 million
       shares for the six months ended June 30, 2003. The exchangeable shares of
       Nabors Exchangeco are exchangeable for Nabors common shares on a
       one-for-one basis, and have essentially identical rights as Nabors
       Industries Ltd. common shares, including but not limited to voting rights
       and the right to receive dividends, if any.

</TEXT>
</DOCUMENT>
</SUBMISSION>
