1615 Poydras Street ?New Orleans, LA 70112
Financial & Media Contact: David P. Joint (504) 582-4203 McMoRan Exploration Co. Provides Update on Davy Jones No. 1 Completion and Updates Exploration and Development Activities
NEW ORLEANS, LA, March 26, 2012 - McMoRan Exploration Co.
(NYSE: MMR) today updated its ultra-deep exploration and
development activities in the shallow waters of the Gulf of
Mexico (GOM) Shelf and onshore in the Gulf Coast area,
including ongoing completion operations at Davy Jones No. 1,
new logging results from Lafitte and in progress operations
at Blackbeard West No. 2 and Lineham Creek.
McMoRan announced today that completion efforts to flow test
the Davy Jones No. 1 well on South Marsh Island Block 230 are
ongoing. During initial attempts to perforate and flow test
the Wilcox "F" sand, the hydraulic perforating
equipment malfunctioned. In order to expedite the test,
McMoRan elected to move up the hole to test another zone
using electric-line perforating equipment while future
operations and plans for the "F" sand are
evaluated. Initial testing of Wilcox "D" sand,
which began on March 24,
2012, saw positive pressure response and McMoRan plans to add
perforations in the Wilcox "C" sand to comingle the zones.
Results from the flow test will be reported as further
progress is achieved.
As previously reported, McMoRan has drilled two successful
sub-salt wells in the Davy Jones field. The Davy Jones No. 1
well logged 200 net feet of pay in multiple Wilcox sands,
which were all full to base. The Davy Jones offset appraisal
well (Davy Jones No. 2), which is located two and a half
miles southwest of Davy Jones No. 1, confirmed 120 net feet
of pay in multiple Wilcox sands, indicating continuity across
the major structural features of the Davy Jones prospect, and
also encountered 192 net feet of potential hydrocarbons in
the Tuscaloosa and Lower Cretaceous carbonate sections.
McMoRan expects to commence the completion of the No. 2 well
in the second half of 2012.
Davy Jones involves a large ultra-deep structure encompassing
four OCS lease blocks (20,000 acres). McMoRan is the operator
and holds a 63.4 percent working interest and a 50.2 percent
net revenue interest in Davy Jones. Other working interest
owners in Davy Jones include: Energy XXI (NASDAQ: EXXI)
(15.8%), JX Nippon Oil Exploration (Gulf) Limited (12%) and
Moncrief Offshore LLC (8.8%).
The Lafitte ultra-deep exploration well, which is located on
Eugene Island Block 223 in 140 feet of water, commenced
drilling on October 3, 2010 and has been drilled to a total
depth of 34,162 feet. In March 2012, McMoRan logged two
potential new hydrocarbon bearing zones in the Upper Eocene
section of the Lafitte well with an aggregate thickness of
approximately 65 net feet. These new Upper Eocene sands
correlate to the Jackson and Yegua sections located Onshore
Louisiana and are older than the Oligocene Vicksburg interval
seen in the Blackbeard East well. These are the first
hydrocarbon bearing Upper Eocene sands encountered either on
the GOM Shelf or in the deepwater offshore Louisiana. In
addition to the new Upper Eocene sands, recent results also
indicated that the well encountered 300 feet of fractured
limestone in the Sparta interval which has indications of
being hydrocarbon bearing. This interval is equivalent to the
Sparta interval seen at Blackbeard East and will require
further evaluation and testing. These results enhance the
potential of McMoRan's other acreage in the Lafitte strategic
area, including McMoRan's Barataria and Captain Blood
ultra-deep prospects. Barataria (10,000 gross acres) is
located west southwest of Lafitte and Captain Blood (10,000
gross acres) is located immediately south of Lafitte.
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These new Upper Eocene sands and Sparta limestones are in
addition to the total possible productive net 211 feet of
sands previously reported in the Lower Miocene including the
Cris R and Oligocene (Frio) in the Lafitte well. Flow testing
will be required to confirm the potential hydrocarbons and
flow rates from these formations. The well will be
temporarily abandoned while development options and potential
delineation locations are evaluated. McMoRan holds a 72.0
percent working interest and a 58.3 percent net revenue
interest in Lafitte. Other working interest owners in Lafitte
include EXXI (18.0%) and Moncrief Offshore LLC (10.0%).
The Blackbeard West No. 2 ultra-deep exploration well
commenced drilling on November 25,
2011 and has been drilled to 18,200 feet. The well, which is
located on Ship Shoal Block 188 within the Blackbeard West
unit, is targeting Miocene aged sands seen below the salt
weld approximately 13 miles east at Blackbeard East and has a
proposed total depth of 26,000 feet. McMoRan holds a 69.4
percent working interest and a 53.1 percent net revenue
interest in Ship Shoal Block 188. Other working interest
owners include EXXI (22.9%) and Moncrief Offshore LLC
(7.7%).
The Lineham Creek exploration prospect, which is located
onshore in Cameron Parish, Louisiana commenced operations on
December 31, 2011. The well, which is targeting Eocene and
Paleocene objectives below the salt weld, is currently
drilling below 10,400 feet towards a proposed total depth
of
29,000 feet. Chevron U.S.A Inc., as operator of the well,
holds a 50 percent working interest. McMoRan is participating
for a 36.0 percent working interest. Other working interest
owners include EXXI (9.0%) and
W. A. "Tex" Moncrief Jr. (5.0%).
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. Additional information
about McMoRan is available on its internet website
"www.mcmoran.com".
CAUTIONARY STATEMENT: This press release contains forward-looking statements that involve a number of assumptions, risks and uncertainties that could cause actual results to differ materially from those contained in the forward- looking statements. We caution readers that forward-looking statements are not guarantees of future performance or exploration and development success, and our actual exploration experience and future financial results may differ materially from those anticipated, projected or assumed in the forward-looking statements. Such forward-looking statements include, but are not limited to, statements regarding various oil and gas discoveries, oil and gas exploration, development and production activities and costs, capital expenditures, reclamation, indemnification and environmental obligations and costs, the potential for or expectation of successful flow tests, anticipated and potential quarterly and annual production and flow rates, reserve estimates, projected operating cash flows and liquidity and other statements that are not historical facts. No assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so,
what impact they may have on our results of operations or financial condition. Important factors that may cause actual results to differ materially from those anticipated by forward-looking statements include, but are not limited to, those associated with general economic and business conditions, failure to realize expected value creation from acquired properties, variations in the market demand for, and prices of, oil and natural gas, drilling results, unanticipated fluctuations in flow rates of producing wells due to mechanical or operational issues (including those experienced at wells operated by third parties where we are a participant), changes in oil and natural gas reserve expectations, the potential adoption of new governmental regulations, unanticipated hazards for which we have limited or no insurance coverage, failure of third party partners to fulfill their capital and other commitments, the ability to satisfy future cash obligations and environmental costs, adverse conditions, such as high temperatures and pressure that could lead to mechanical failures or increased costs, the ability to retain current or future lease acreage rights, the ability to satisfy future cash obligations and environmental costs, access to capital to fund drilling activities, as well as other general exploration and development risks and hazards and other factors described in more detail in Part I, Item 1A. "Risk Factors" included in our Annual Report on Form 10-K for the year ended December 31, 2011 filed with the SEC.
Investors are cautioned that many of the assumptions upon which our forward-looking statements are based are likely to change after our forward-looking statements are made, including for example the market prices of oil and natural gas, which we cannot control, and production volumes and costs, some aspects of which we may or may not be able to control. Further, we may make changes to our business plans that could or will affect our results. We caution investors that we do not intend to update our forward-looking statements more frequently than quarterly, notwithstanding any changes in our assumptions, changes in our business plans, our actual experience, or other changes, and we undertake no obligation to update any forward-looking statements.
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| This press release was issued by McMoran Exploration Company and was initially posted at http://www.mcmoran.com/pdf/2012/032612.pdf . It was distributed, unedited and unaltered, by noodls on 2012-03-27 01:32:54 AM. The issuer is solely responsible for the accuracy of the information contained therein. |