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): February 8, 2001
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 and Regulation FD Disclosure.
McMoRan Exploration Co. announces the following update on the status
of its pending sulphur supply lawsuit hearing:
Freeport Sulphur's sulphur supply agreement
with IMC-Agrico requires good faith renegotiation of the
pricing provisions if a party can establish that fundamental
changes in IMC-Agrico's operations or the sulphur and
sulphur transportation markets invalidate certain
assumptions and result in the performance by that party
becoming "commercially impracticable" or "grossly
inequitable." In the fourth quarter of 1998, IMC-Agrico
attempted to invoke this contract provision in an effort to
renegotiate the pricing terms of the agreement. After
careful review of the agreement, IMC-Agrico's operations and
the referenced markets, Freeport Sulphur determined that
there is no basis for renegotiation of the pricing
provisions of the agreement. After discussions failed to
resolve this dispute, Freeport Sulphur filed suit against
IMC-Agrico seeking a judicial declaration that no basis
exists under the agreement for a renegotiation of its
pricing terms. IMC-Agrico has alleged that Freeport
Sulphur's announced suspension of sulphur production at Main
Pass and Freeport Sulphur's proposed sale of its sulphur
transportation assets constitute a statement of intent to
breach Freeport Sulphur's obligations under the agreement.
Freeport Sulphur intends to pursue vigorously its rights
under the agreement.
IMC Agrico asserted that Freeport Sulphur cannot assign
the sulphur supply contract without IMC-Agrico's consent on
the basis that a sale of Freeport Sulphur's transportation
and marketing assets would not constitute a sale of
substantially all of Freeport Sulphur's assets, a condition
IMC-Agrico asserts is necessary for an assignment without
its consent, since the Main Pass facilities would not be
included in the sale. In December 2000, IMC-Agrico filed a
motion for summary judgment on this issue. Freeport Sulphur
believes that a sale of the transportation and marketing
assets would constitute substantially all of Freeport
Sulphur's assets because the reclamation obligations
associated with Main Pass result in these facilities having
a negative value and the discontinuation of sulphur
production at Main Pass did not breach the sulphur supply
agreement. In February 2001, Freeport Sulphur filed a motion
for partial summary judgment on these issues. Freeport
Sulphur and its legal advisors believe all of IMC-Agrico's
claims are without merit. These motions are scheduled to be
heard by the court at proceedings currently scheduled for
March 2001.
Item 7. Financial Statements and Exhibits
This report contains the following exhibits:
. McMoRan Exploration Co.'s audited balance sheets as of
December 31, 2000 and 1999 and related audited statements of
operations, cash flow and changes in stockholders' equity for
each of the three years in the period ended December 31, 2000,
together with accompanying notes and the report thereon of its
independent public accountants (Exhibit 99.1).
. Computation of Ratio of Earnings to Fixed Charges (Exhibit 12.1).
. Consents of Arthur Andersen LLP (Exhibit 23.1) and Ryder
Scott LP (Exhibit 23.2).
SIGNATURE
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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: February 8, 2001
McMoRan Exploration Co.
Exhibit Index
Exhibit
Number
12.1 Computation of Ratio of Earnings to Fixed Charges
23.1 Consent of Arthur Andersen LLP
23.2 Consent of Ryder Scott, L.P.
99.1 Balance Sheets as of December 31, 2000 and 1999
Statements of Operations for each of the three years in the
period ended December 31, 2000
Statements of Cash Flow for each of the three years in the
period ended December 31, 2000
Statements of Changes in Stockholders' Equity for each of
the three years in the period ended December 31, 2000
Notes to Financial Statements
Report of Independent Public Accountants