McMoRan Exploration sells interests in Brazos Block to Shell Offshore

McMoRan Exploration announced that the McMoRan exploration program has agreed to sell its 35 % interest in the Brazos Block A-19 field and its 50 % interest in the unexplored Brazos Block A-26 to Shell Offshore for $ 70 mm. MMR's 95 % share of the program equates to $ 66.5 mm in sales proceeds.
As previously reported, the Brazos A-19 JC No. 1 well was damaged during the early production phase in November 1999, after producing approximately 84 mm cfpd of natural gas for approximately one month. Attempts to repair the well were unsuccessful, and subsequently the well was plugged and abandoned. Shell, the operator of the block, plans to drill a new well on Brazos A-19 in the near future. MMR will also continue to pursue its rights for recovery under its business interruption insurance policy.
Richard C. Adkerson, MMR's Co-Chairman and CEO, said, "We are very pleased with the sale of the Brazos properties. This transaction provides us significant near term financial resources for use in our expanded oil and gas exploration program in the Gulf of Mexico." The Brazos blocks are located in the western Gulf of Mexico, about 75 miles south, south-west of Galveston, TX. The sale, which is subject to the execution of definitive agreements and approval by the Boards of Directors of both companies, is expected to close within 30 days.

McMoRan is an independent public company engaged in the exploration, development and production of oil and natural gas offshore in the Gulf of Mexico and onshore in the Gulf Coast area; and the mining, purchasing, transporting, terminalling, processing and marketing of sulphur.