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): September 15, 2000
McMoRan Exploration Co.
Delaware 001-07791 72-1424200
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation or Number)
organization)
1615 Poydras Street
New Orleans, Louisiana 70112
Registrant's telephone number, including area code: (504) 582-4000
Item 5. Other Events.
McMoRan Exploration Co. (McMoRan) announced today the following
oil and gas exploration alliance:
Today we announced that we have entered into an alliance with
Samedan Oil Corporation, a wholly owned subsidiary of Noble
Affiliates, Inc. to conduct exploration on our oil and gas
acreage in the Gulf of Mexico. Samedan has committed to
participate with a 25 percent working interest in six of seven
specified prospects as shown in the table below. In addition,
Samedan has agreed to work with us in identifying additional
future prospects from the acreage position accumulated by us in
our previously announced transactions with Shell Offshore Inc.
and Texaco Exploration and Production Inc. and Samedan has the
right to participate in future prospects.
Following are the seven specified prospects with approximate
ownership interests:
Prospect location
(offshore blocks) McMoRan Samedan
---------------------------------- ------------ ------------
WI(1) NRI(1) WI(2) NRI(2)
----- ------ ----- ------
Vermilion 195/196/207 47.5% 34.2% 25.0% 18.0%
Eugene Island 96/97/109 - shallow 38.0% 27.4% 25.0% 18.0%
Eugene Island 96/97/109 - deep 46.3% 33.2% 25.0% 17.9%
Vermilion 144/145 71.3% 57.2% 25.0% 20.1%
West Delta 1/12/13/Grand Isle 2 47.5% 32.1% 25.0% 16.9%
Louisiana State Lease 340 (portions) 30.4% 23.9% 25.0% 19.6%
Garden Banks 272(3) 71.3% 51.3% 25.0% 18.0%
(1) Reflects minimum estimated working interests (WI) and net
revenue interests (NRI), assuming participation election by
others, except that the Halliburton Company right to participate is not
included. Halliburton has the right to participate by paying 20
percent of our acquisition, exploration and development costs and
receiving 20 percent of our net revenues until payout, after
which Halliburton receives 6 percent of our interest.
(2) Samedan will share costs on a disproportionate basis to earn
these WIs and NRIs.
(3) Prospect under evaluation. We have not yet committed to
drill an initial test well on this lease. If drilled, Samedan
has the option to participate.
The Shell and Texaco transactions provide us exploration
rights to an aggregate of approximately 660,000 acres on 145
blocks in the Gulf of Mexico from coastal water depths up to
2,200 feet, with a majority in water depths less than 400 feet.
In the Shell transaction, we purchased Shell's interest in 56
blocks in the Gulf of Mexico for $37.7 million in cash and Shell
retained a one-twelfth overriding royalty interest. In the
Texaco transaction, we acquired exploration rights on 89 blocks
in the Gulf of Mexico and agreed to spend $110 million on
exploration through June 30, 2003. Texaco retained rights to
participate on varying terms.
Samedan's share of estimated costs for the specified
exploration projects is approximately $25 million. This Samedan
commitment ensures our $50 million in current availability under
a bank credit facility which is guaranteed by Halliburton
and secured by our producing properties. No amounts are
currently outstanding under this facility. Under our alliance
with Halliburton, an integrated team of McMoRan, Halliburton and
McMoRan contractor personnel has been established to conduct our
exploration, development and production activities and
Halliburton services are used in these activities when
applicable. We are obligated to raise specified levels of
additional capital by December 31, 2000 and 2001. The commitment
by Samedan, together with $50 million raised by us in a common
stock offering in April 2000, will serve to substantially fulfill
the December 31, 2000 obligation. In addition, Halliburton has
an option to participate in our interests in the development of our
exploration discoveries.
SIGNATURE
------------------
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
McMoRan Exploration Co.
By: /s/ C. Donald Whitmire Jr.
------------------------------
C. Donald Whitmire, Jr.
Vice President & Controller -
Financial Reporting
(authorized signatory and
Principal Accounting Officer)
Date: September 19, 2000