Printer Friendly


McMoRan Exploration Co. (NYSE: MMR), New Orleans, La, has announced the completion of its previously announced acquisition of Plains Exploration & Production Company's (NYSE: PXP) shallow water Gulf of Mexico (GOM) shelf assets and related financings. The transactions were approved by McMoRan's shareholders at a special meeting of stockholders held recently. Approximately 99 percent of the votes cast supported these transactions. Under the terms of the PXP transaction, McMoRan issued 51 million shares of McMoRan common stock and paid $75 million in cash to PXP for all of PXP's interests and exploration rights in the shallow waters of the shelf of the GOM. In addition, McMoRan paid PXP $11 million associated with estimated revenues, expenses and capital expenditures attributable to the properties from the August 1, 2010 effective date through the closing date.

The acquisition increases McMoRan's scale of operations on the GOM shelf, consolidates its ownership in core focus areas, expands its participation in its deep gas and ultra-deep exploration and development programs and increases current reserves and production.

The financing transactions completed include the previously announced (September 20, 2010) $900 million in equity-linked securities, including, $200 million of 4% Convertible Senior Notes due 2017 and $700 million of 5 3/4% Convertible Perpetual Preferred Stock. The financing included $400 million in investments from institutional investors and $500 million of convertible preferred stock from Freeport-McMoRan Copper & Gold Inc. After funding the cash portion of the acquisition, McMoRan estimates its year-end 2010 cash position will approximate $900 million, which is available to fund future capital expenditures associated with McMoRan's expanded asset base and for general corporate purposes.

McMoRan also announced the appointment of two designees of PXP, James C. Flores and John F. Wombwell, to McMoRan's Board of Directors pursuant to the agreement between McMoRan and PXP.

James R. Moffett and Richard C. Adkerson, Co-Chairmen of McMoRan said: We are pleased to complete this important acquisition which enables us to effectively double our participation in our key exploration and production projects in the shallow waters of the GOM. Our multi-year efforts have enabled us to define and de-risk the significant geologic potential of this exciting new exploration frontier and develop substantial expertise in executing our drilling and development program. The financing transactions completed recently provide McMoRan with significant financial resources to pursue our plans as we work to create asset values and build on our success.

McMoRan has approximately 157 million basic shares of common stock outstanding. Assuming conversion of McMoRan's remaining outstanding 8% Convertible Perpetual Preferred Stock, 5.25% Convertible Debt due 2011 and including the newly issued 4% Convertible Senior Notes and 5 3/4% Convertible Perpetual Preferred Stock, McMoRan would have approximately 221 million common shares outstanding on a fully converted basis.

McMoRan Exploration Co. is an independent public company engaged in the exploration, development and production of natural gas and oil in the shallow waters of the GOM Shelf and onshore in the Gulf Coast area.

For more information, visit or call 504/582-4203.
COPYRIGHT 2011 Worldwide Videotex
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2011 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:Worldwide Energy
Date:Feb 1, 2011

Terms of use | Privacy policy | Copyright © 2019 Farlex, Inc. | Feedback | For webmasters