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|                                                        |
|-------------------------------------------------------------|
| UNITED      STATES                                          |
| SECURITIES AND EXCHANGE      COMMISSION                     |
| Washington, D.C.      20549                                 |
|                                                        |
| FORM  10-Q                                                  |
|                                                        |
| (Mark    One)                                               |
| [X]                                                         | QUARTERLY REPORT PURSUANT TO      SECTION 13 OR 15(d) OF THE |
| SECURITIES EXCHANGE ACT OF      1934                        |
| For the quarterly period ended      June 30, 2008           |
| OR                                                          |
| [  ]                                              | TRANSITION REPORT PURSUANT TO      SECTION 13 OR 15(d) OF THE |
| SECURITIES EXCHANGE ACT OF      1934                        |
| For the transition period      from                         |   | to |
| Commission File Number:      001-07791                      |
|                                                        |
|                                                        |
|                                                        |
| McMoRan Exploration      Co.                                |
| (Exact      name of registrant as specified in its charter) |
|                                                        |

| Delaware                                                                | 72-1424200                             |
|-------------------------------------------------------------------------|----------------------------------------|
| (State      or other jurisdiction ofincorporation      or organization) | (IRS      Employer Identification No.) |
|                                                                    |                                   |
| 1615 Poydras      Street                                                |                                   |
| New Orleans,      Louisiana*                                            | 70112                                  |
| (Address      of principal executive offices)                           | (Zip      Code)                        |
|                                                                    |
|                                                                    |
| (504)      582-4000                                                     |
| (Registrant's      telephone number, including area code)               |
|                                                                    |

| Large      accelerated filer o                              | Accelerated      filer S         |
|-------------------------------------------------------------|----------------------------------|
| Non-accelerated      filer o(Do      not check if a smaller | Smaller      reporting company o |
| reporting      company)                                     |                             |

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|                                                             |
|------------------------------------------------------------------|
| McMoRan      Exploration Co.                                     |
| TABLE OF CONTENTS                                                |
|                                                             |
|                                                             | Page |
|                                                             |   |
| Part      I.  Financial Information                    |   |
|                                                             |   |
| Financial      Statements:                                       |   |
|                                                             |   |
| Condensed Consolidated Balance Sheets      (Unaudited)           | 3 |
|                                                             |   |
| Consolidated Statements of Operations      (Unaudited)           | 4 |
|                                                             |   |
| Consolidated Statements of Cash Flow      (Unaudited)            | 5 |
|                                                             |   |
| Notes to Consolidated Financial    Statements                    | 6 |
|                                                             |   |
| Report of Independent Registered Public Accounting      Firm     | 25 |
|                                                             |   |
| Management's Discussion and Analysis                             |   |
| of Financial Condition and Results of      Operations            | 26 |
|                                                             |   |
| Quantitative and Qualitative Disclosures about      Market Risks | 40 |
|                                                             |   |
| Controls and Procedures                                          | 41 |
|                                                             |   |
| Part      II.  Other Information                       | 41 |
|                                                             |   |
| Signature                                                        | 43 |
|                                                             |   |
| Exhibit      Index                                               | E-1 |

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TABLE OF CONTENTS

Part I.  FINANCIAL INFORMATION

| Item      1. | Financial      Statements. |
|--------------|----------------------------|

|   | McMoRan      EXPLORATION CO. |
|--------|------------------------------|

CONDENSED CONSOLIDATEDBALANCE SHEETS 

|                                                                           |   | June      30,       |      | December      31, |   |
|--------------------------------------------------------------------------------|--------|---------------------|-----------|-------------------|--------|
|                                                                           |   | 2008                |      | 2007              |   |
|                                                                           |   | (In      Thousands) |      |
| ASSETS                                                                         |   |                |      |              |   |   |   |
| Cash      and cash equivalents                                                 |   | $                   | 523       |              | $      | 4,830 |   |
| Accounts      receivable                                                       |   |                | 221,017   |              |   | 128,690 |   |
| Inventories                                                                    |   |                | 12,946    |              |   | 11,507 |   |
| Prepaid      expenses                                                          |   |                | 4,248     |              |   | 14,331 |   |
| Fair      value of oil and gas derivative contracts                            |   |                | -         |              |   | 16,623 |   |
| Current      assets from discontinued operations, including restricted    cash |   |                |      |              |   |   |   |
| of      $0.5 million                                                           |   |                | 3,024     |              |   | 3,029 |   |
| Total      current assets                                                      |   |                | 241,758   |              |   | 179,010 |   |
| Property,      plant and equipment, net                                        |   |                | 1,382,230 |              |   | 1,503,359 |   |
| Sulphur      business assets, net                                              |   |                | 342       |              |   | 349 |   |
| Restricted      investments and cash                                           |   |                | 22,311    |              |   | 7,036 |   |
| Fair      value of oil and gas derivative contracts                            |   |                | 162       |              |   | 4,317 |   |
| Deferred      financing costs                                                  |   |                | 17,734    |              |   | 21,217 |   |
| Total      assets                                                              |   | $                   | 1,664,537 |              | $      | 1,715,288 |   |
|                                                                           |   |                |      |              |   |   |   |
| LIABILITIES      AND STOCKHOLDERS’ EQUITY                                |   |                |      |              |   |   |   |
| Accounts      payable                                                          |   | $                   | 112,631   |              | $      | 97,821 |   |
| Accrued      liabilities                                                       |   |                | 100,851   |              |   | 68,292 |   |
| 6%      convertible senior notes                                               |   |                | 43,503    |              |   | 100,870 |   |
| Other      short term borrowings                                               |   |                | -         |              |   | 10,665 |   |
| Accrued      interest and dividends payable                                    |   |                | 9,898     |              |   | 13,055 |   |
| Current      portion of accrued oil and gas reclamation costs                  |   |                | 73,780    |              |   | 80,839 |   |
| Current      portion of accrued sulphur reclamation cost                       |   |                | 10,659    |              |   | 12,145 |   |
| Fair      value of oil and gas derivative contracts                            |   |                | 64,417    |              |   | 14,001 |   |
| Current      liabilities from discontinued operations                          |   |                | 1,727     |              |   | 2,624 |   |
| Total      current liabilities                                                 |   |                | 417,466   |              |   | 400,312 |   |
| Senior      secured revolving credit facility                                  |   |                | 4,500     |              |   | 274,000 |   |
| 5¼%      convertible senior notes                                         |   |                | 74,720    |              |   | 115,000 |   |
| 11.875%      senior notes                                                      |   |                | 300,000   |              |   | 300,000 |   |
| Accrued      oil and gas reclamation costs                                     |   |                | 230,783   |              |   | 213,898 |   |
| Accrued      sulphur reclamation costs                                         |   |                | 9,498     |              |   | 9,155 |   |
| Contractual      postretirement obligation                                     |   |                | 5,781     |              |   | 6,216 |   |
| Fair      value of oil and gas derivative contracts                            |   |                | 21,124    |              |   | 7,516 |   |
| Other      long-term liabilities                                               |   |                | 24,425    |              |   | 16,962 |   |
| Total      liabilities                                                         |   |                | 1,088,297 |              |   | 1,343,059 |   |
| Stockholders'      equity                                                      |   |                | 576,240   |              |   | 372,229 |   |
| Total      liabilities and stockholders' equity                                |   | $                   | 1,664,537 |              | $      | 1,715,288 |   |
|                                                                           |   |                |      |              |   |   |   |

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TABLE OF CONTENTS

CONSOLIDATED STATEMENTS OFOPERATIONS 

|                                                               | Three      Months Ended                       |    | Six      Months Ended |   |
|--------------------------------------------------------------------|-----------------------------------------------|---------|-----------------------|--------|
|                                                               | June      30,                                 |    | June      30,         |   |
|                                                               | 2008                                          |    | 2007                  |   | 2008 |   | 2007 |   |
|                                                               | (In      Thousands, Except Per Share Amounts) |    |
| Revenues:                                                          |                                          |    |                  |   |   |   |   |   |   |   |   |   |
| Oil      and gas                                                   | $                                             | 372,321 |                  | $      | 44,988 |   | $ | 664,267 |   | $ | 96,363 |   |
| Service                                                            |                                          | 3,187   |                  |   | 360 |   |   | 6,717 |   |   | 682 |   |
| Total      revenues                                                |                                          | 375,508 |                  |   | 45,348 |   |   | 670,984 |   |   | 97,045 |   |
| Costs      and expenses:                                           |                                          |    |                  |   |   |   |   |   |   |   |   |   |
| Production      and delivery costs                                 |                                          | 69,505  |                  |   | 16,618 |   |   | 125,151 |   |   | 34,346 |   |
| Depletion,      depreciation and amortization                      |                                          | 121,001 |                  |   | 15,530 |   |   | 242,333 |   |   | 42,565 |   |
| Exploration      expenses                                          |                                          | 27,480  |                  |   | 5,348 |   |   | 34,293 |   |   | 15,103 |   |
| Loss      on oil and gas derivative contracts                      |                                          | 70,775  |                  |   | - |   |   | 116,006 |   |   | - |   |
| General      and administrative expenses                           |                                          | 18,237  |                  |   | 4,415 |   |   | 27,249 |   |   | 10,812 |   |
| Start-up      costs for Main Pass Energy Hub™                |                                          | 1,645   |                  |   | 2,752 |   |   | 3,262 |   |   | 5,457 |   |
| Insurance      recovery                                            |                                          | (3,391  | )                     |   | - |   |   | (3,391 | ) |   | - |   |
| Total      costs and expenses                                      |                                          | 305,252 |                  |   | 44,663 |   |   | 544,903 |   |   | 108,283 |   |
| Operating      income (loss)                                       |                                          | 70,256  |                  |   | 685 |   |   | 126,081 |   |   | (11,238 | ) |
| Interest      expense, net                                         |                                          | (12,520 | )                     |   | (5,755 | ) |   | (29,631 | ) |   | (11,409 | ) |
| Other      income (expense), net                                   |                                          | (1,897  | )                     |   | 833 |   |   | (2,524 | ) |   | 1,581 |   |
| Income      (loss) from continuing operations before income taxes  |                                          | 55,839  |                  |   | (4,237 | ) |   | 93,926 |   |   | (21,066 | ) |
| Provision      for income taxes                                    |                                          | (1,009  | )                     |   | - |   |   | (1,865 | ) |   | - |   |
| Income      (loss) from continuing operations                      |                                          | 54,830  |                  |   | (4,237 | ) |   | 92,061 |   |   | (21,066 | ) |
| Income (loss) from discontinued      operations                    |                                          | (748    | )                     |   | (1,102 | ) |   | (1,604 | ) |   | 1,229 |   |
| Net      income (loss)                                             |                                          | 54,082  |                  |   | (5,339 | ) |   | 90,457 |   |   | (19,837 | ) |
| Preferred      dividends and amortization of convertible preferred |                                          |    |                  |   |   |   |   |   |   |   |   |   |
| stock      issuance costs                                          |                                          | (4,357  | )                     |   | (1,147 | ) |   | (8,723 | ) |   | (1,552 | ) |
| Net      income (loss) applicable to common stock                  | $                                             | 49,725  |                  | $      | (6,486 | ) | $ | 81,734 |   | $ | (21,389 | ) |
|                                                               |                                          |    |                  |   |   |   |   |   |   |   |   |   |
| Basic      net income (loss) per share of common stock:            |                                          |    |                  |   |   |   |   |   |   |   |   |   |
| Continuing      operations                                         |                                          | $0.88   |                  |   | $(0.19 | ) |   | $1.50 |   |   | $(0.79 | ) |
| Discontinued      operations                                       |                                          | (0.01   | )                     |   | (0.04 | ) |   | (0.03 | ) |   | 0.04 |   |
| Net      income (loss) per share of common stock                   |                                          | $0.87   |                  |   | $(0.23 | ) |   | $1.47 |   |   | $(0.75 | ) |
|                                                               |                                          |    |                  |   |   |   |   |   |   |   |   |   |
| Diluted      net income (loss) per share of common stock:          |                                          |    |                  |   |   |   |   |   |   |   |   |   |
| Continuing      operations                                         |                                          | $0.64   |                  |   | $(0.19 | ) |   | $1.11 |   |   | $(0.79 | ) |
| Discontinued      operations                                       |                                          | (0.01   | )                     |   | (0.04 | ) |   | (0.02 | ) |   | 0.04 |   |
| Net      income (loss) per share of common stock                   |                                          | $0.63   |                  |   | $(0.23 | ) |   | $1.09 |   |   | $(0.75 | ) |
|                                                               |                                          |    |                  |   |   |   |   |   |   |   |   |   |
| Average      common shares outstanding :                           |                                          |    |                  |   |   |   |   |   |   |   |   |   |
| Basic                                                              |                                          | 57,450  |                  |   | 28,882 |   |   | 55,703 |   |   | 28,620 |   |
| Diluted                                                            |                                          | 88,278  |                  |   | 28,882 |   |   | 86,783 |   |   | 28,620 |   |

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CONSOLIDATED STATEMENTS OFCASH FLOW 

|                                                                    |   | Six      Months Ended |     |
|-------------------------------------------------------------------------|--------|-----------------------|----------|
|                                                                    |   | June      30,         |     |
|                                                                    |   | 2008                  |     | 2007 |   |
|                                                                    |   | (In      Thousands)   |     |
| Cash      flow from operating activities:                               |   |                  |     |   |   |   |   |
| Net      income (loss)                                                  |   | $                     | 90,457   |   | $ | (19,837 | ) |
| Adjustments      to reconcile net income (loss) to net cash provided by |   |                  |     |   |   |   |   |
| operating      activities:                                              |   |                  |     |   |   |   |   |
| (Income)      loss from discontinued operations                         |   |                  | 1,604    |   |   | (1,229 | ) |
| Depletion,      depreciation and amortization                           |   |                  | 242,333  |   |   | 42,565 |   |
| Exploration      drilling and related expenditures                      |   |                  | 11,873   |   |   | 1,335 |   |
| Compensation      expense associated with stock-based awards            |   |                  | 20,875   |   |   | 8,740 |   |
| Amortization      of deferred financing costs                           |   |                  | 2,757    |   |   | 1,192 |   |
| Unrealized      loss on oil and gas derivative contracts                |   |                  | 84,802   |   |   | - |   |
| Loss      on induced conversions of convertible senior notes            |   |                  | 2,663    |   |   | - |   |
| Reclamation      expenditures                                           |   |                  | (4,005   | ) |   | (2,858 | ) |
| Prepayment      of reclamation expenditures by third party owners       |   |                  | 2,859    |   |   | - |   |
| Increase      in restricted cash                                        |   |                  | (7,567   | ) |   | - |   |
| Other                                                                   |   |                  | (262     | ) |   | (448 | ) |
| (Increase)      decrease in working capital:                            |   |                  |     |   |   |   |   |
| Accounts      receivable                                                |   |                  | (82,176  | ) |   | (2,651 | ) |
| Accounts      payable and accrued liabilities                           |   |                  | 17,582   |   |   | (13,774 | ) |
| Prepaid      expenses and inventories                                   |   |                  | (2,024   | ) |   | 25,032 |   |
| Net      cash provided by continuing operations                         |   |                  | 381,771  |   |   | 38,067 |   |
| Net      cash provided by discontinued operations                       |   |                  | 454      |   |   | 576 |   |
| Net      cash provided by operating activities                          |   |                  | 382,225  |   |   | 38,643 |   |
|                                                                    |   |                  |     |   |   |   |   |
| Cash      flow from investing activities:                               |   |                  |     |   |   |   |   |
| Exploration,      development and other capital expenditures            |   |                  | (111,059 | ) |   | (76,576 | ) |
| Acquisition      of oil and gas properties                              |   |                  | 1,112    |   |   | - |   |
| Proceeds      from restricted investments                               |   |                  | -        |   |   | 3,019 |   |
| Increase      in restricted investments                                 |   |                  | -        |   |   | (87 | ) |
| Net      cash used in continuing operations                             |   |                  | (109,947 | ) |   | (73,644 | ) |
| Net      cash from discontinued operations                              |   |                  | -        |   |   | - |   |
| Net      cash used in investing activities                              |   |                  | (109,947 | ) |   | (73,644 | ) |
|                                                                    |   |                  |     |   |   |   |   |
| Cash flow from financing      activities:                               |   |                  |     |   |   |   |   |
| Payments      under senior secured revolving credit facility, net       |   |                  | (269,500 | ) |   | (28,750 | ) |
| Proceeds      from senior secured term loan                             |   |                  | -        |   |   | 100,000 |   |
| Financing      costs                                                    |   |                  | -        |   |   | (2,635 | ) |
| Dividends      paid on convertible preferred stock                      |   |                  | (9,108   | ) |   | (747 | ) |
| Payments      for induced conversion of convertible senior notes        |   |                  | (2,663   | ) |   | - |   |
| Proceeds      from exercise of stock options and other                  |   |                  | 4,686    |   |   | 1,280 |   |
| Net      cash (used in) provided by continuing operations               |   |                  | (276,585 | ) |   | 69,148 |   |
| Net      cash from discontinued operations                              |   |                  | -        |   |   | - |   |
| Net      cash (used in) provided by financing activities                |   |                  | (276,585 | ) |   | 69,148 |   |
| Net      (decrease) increase in cash and cash equivalents               |   |                  | (4,307   | ) |   | 34,147 |   |
| Cash      and cash equivalents at beginning of year                     |   |                  | 4,830    |   |   | 17,830 |   |
| Cash      and cash equivalents at end of period                         |   | $                     | 523      |   | $ | 51,977 |   |

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

| Cash      paid for acquired assets at closing (August 6, 2007) | $      | 1,076,286 |    |
|----------------------------------------------------------------|--------|-----------|---------|
| Estimated      oil & gas reclamation costs                 |   | 269,668   |    |
| Net      assets acquired at closing                            |   | 1,345,954 |    |
| Post      closing adjustments                                  |   | (40,293   | )a      |
| Other      acquisition related costs                           |   | 16,645    |  b |
| Net      assets acquired                                       | $      | 1,322,306 |    |

| a.   | Represents      net cash flow from the operation of the acquired properties during the      period from July 1, 2007 (effective date) to August 6, 2007 (closing      date). |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| b.   | Includes      $3.5 million contingency settled in the first quarter of    2008. |
|----------------|---------------------------------------------------------------------------------|

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| Accounts      receivable                                       | $      | 35,649    |   |
|----------------------------------------------------------------|--------|-----------|--------|
| Oil      and gas property, plant and equipment                 |   | 1,323,721 |   |
| Asset      retirement obligations                              |   | (269,668  | )      |
| Other      accrued liabilities                                 |   | (13,416   | )      |
| Cash      paid for acquired assets at closing (August 6, 2007) | $      | 1,076,286 |   |

|                                                     | Second      Quarter |    |   | Six      Months |   |
|----------------------------------------------------------|---------------------|---------|--------|-----------------|--------|
|                                                     | 2007                |    |   | 2007            |   |
| Revenues                                                 | $                   | 237,634 |   |            | $      | 434,927 |   |
| Operating      income                                    |                | 83,675  |   |            |   | 56,993 |   |
| Net      income (loss)                                   |                | 48,772  |   |            |   | (8,784 | ) |
| Basic      net income (loss) per share of common stock   | $                   | 1.55    |   |            | $      | (0.48 | ) |
| Diluted      net income (loss) per share of common stock |                | 1.08    |   |            |   | (0.48 | ) |

|                                            | June      30, |    | December      31, |   |
|-------------------------------------------------|---------------|---------|-------------------|--------|
|                                            | 2008          |    | 2007              |   |
| Senior      secured revolving credit facility   | $             | 4,500   |              | $      | 274,000 |   |
| 11.875%      senior notes due 2014              |          | 300,000 |              |   | 300,000 |   |
| 5¼%      convertible senior notes due 2011 |          | 74,720  |              |   | 115,000 |   |
| 6%      convertible senior notes due 2008       |          | 43,503  | a                 |   | 100,870 |   |
| Other                                           |          | -       |              |   | 10,665 |   |
| Total      debt                                 |          | 422,723 |              |   | 800,535 |   |
| Less      current maturities                    |          | (43,503 | )                 |   | (111,535 | ) |
| Long-term      debt                             | $             | 379,220 |              | $      | 689,000 |   |

| a.   | On      July 2, 2008, the remaining holders of McMoRan’s 6% senior convertible      notes elected to convert their notes into 3.05 million shares of McMoRan      common stock. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                                                                                 |   | Second  |   | Six    |   |
|------------------------------------------------------------------------------------------------------|--------|---------|--------|--------|--------|
|                                                                                                 |   | Quarter |   | Months |   |
| Basic      net income from continuing operations                                                     |   | $       | 50,473 |   | $      | 83,338 |   |
| Add:  Preferred      dividends from assumed conversion of  6¾%    mandatory |   |    |   |   |   |   |   |
| convertible      preferred stock                                                                     |   |    | 4,357  |   |   | 8,723 |   |
| Add:  Net      interest from assumed conversion of 6% notes                                |   |    | 281    |   |   | 1,533 |   |
| Add:  Net      interest from assumed conversion of 5¼% notes                          |   |    | 1,017  |   |   | 2,548 |   |
| Diluted      net income from continuing operations                                                   |   |    | 56,128 |   |   | 96,142 |   |
| Loss      from discontinued operations                                                               |   |    | (748   | )      |   | (1,604 | ) |
| Diluted      net income applicable to common stock                                                   |   | $       | 55,380 |   |   | 94,538 |   |
|                                                                                                 |   |    |   |   |   |   |   |
| Weighted      average common shares outstanding for purpose of    calculating                        |   |    |   |   |   |   |   |
| basic      net income per share                                                                      |   |    | 57,450 |   |   | 55,703 |   |
| Assumed      exercise of dilutive stock options a,      b                                            |   |    | 2,738  |   |   | 1,897 |   |
| Assumed      exercise of stock warrants a,      c                                                    |   |    | 495    |   |   | 522 |   |
| Assumed      conversion of 6¾% mandatory convertible preferred stock      d                     |   |    | 17,346 |   |   | 17,368 |   |
| Assumed      conversion of 6% notes      e                                                           |   |    | 4,150  |   |   | 4,754 |   |
| Assumed      conversion of 5¼% notes f                                                          |   |    | 6,099  |   |   | 6,519 |   |
| Weighted      average common shares outstanding                                                      |   |    |   |   |   |   |   |
| for      purposes of calculating diluted net income per share                                        |   |    | 88,278 |   |   | 86,763 |   |
|                                                                                                 |   |    |   |   |   |   |   |
| Diluted      net income per share from continuing operations                                         |   |    | $0.64  |   |   | $1.11 |   |
| Diluted      net loss per share from discontinued operations                                         |   |    | (0.01  | )      |   | (0.02 | ) |
| Diluted      net income per share                                                                    |   |    | $0.63  |   |   | $1.09 |   |

|                                                         |   |   | Second  |   |   | Six    |   |
|--------------------------------------------------------------|--------|--------|---------|--------|--------|--------|--------|
|                                                         |   |   | Quarter |   |   | Months |   |
| Stock      options a,      b                                 |   |   | 725     |   |   | 657    |   |
| Stock      warrants a,      c                                |   |   | 1,558   |   |   | 1,534  |   |
| 5%      mandatorily redeemable convertible preferred stock g |   |   | -       |   |   | -      |   |
| 6%      convertible senior notes e                           |   |   | 7,079   |   |   | 7,079  |   |
| 5¼%      convertible senior notes f                     |   |   | 6,938   |   |   | 6,938  |   |

| a.   | McMoRan      uses the treasury stock method to determine total shares related to      in-the-money stock options and stock warrants for purposes of its diluted      earning per share calculation. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| b.   | Represents      stock options with an exercise price less than the average market price      for McMoRan’s common stock for the periods  presented. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

| c.   | Includes      in-the-money stock warrants issued to K1 USA Energy Production Corporation      (K1) in December 2002 (1.74 million shares) and September 2003 (0.76      million shares).  The warrants were exercisable for McMoRan      common stock at any time over their respective five-year terms at an      exercise price of $5.25 per share.  In December 2007, K1      exercised the stock warrant for 1.74 million common shares.  In      June 2008, K1 exercised the stock warrant for 0.76 million common shares      in a cashless transaction and received 0.64 million common      shares.  See Note 5 of the 2007 Form 10-K for additional      information regarding the warrants. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| d.   | See      Note 8 of the 2007 Form 10-K for information regarding McMoRan’s 6¾%      mandatory convertible preferredstock. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------|

| e.   | The      6% notes, issued in July 2003, were convertible at the option of the      holder at any time prior to their maturity on July 2, 2008 into shares of      McMoRan common stock at a conversion price of $14.25 per      share.  Net interest expense on the 6% notes totaled $0.3      million and $1.4 million during the second quarter of 2008 and 2007,      respectively, and $1.5 million and $2.9 million for the six month periods      ended June 30, 2008 and 2007, respectively.  On July 2, 2008,      the remaining holders converted the 6% notes into shares of McMoRan common      stock.  Additional information regarding the 6% notes is      discussed in Note 6 of the 2007 Form10-K. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| f.   | The      5¼% notes, issued in October 2004, are convertible at the option of the      holder at any time prior to their maturity on October 6, 2011 into shares      of McMoRan common stock at a conversion price of $16.575 per      share.   Net interest expense on the 5¼% notes totaled $1.0      and $1.4 million during the second quarter of 2008 and 2007, respectively,      and $2.5 million and $2.7 million for the six month periods ended June 30,      2008 and 2007, respectively. Additional information regarding the 5¼%      notes is discussed in Note 6 of the 2007 Form  10-K. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| g.   | All      of the remaining shares of McMoRan’s 5% mandatorily redeemable convertible      preferred stock (5% preferred stock) were converted into approximately 6.2      million shares of McMoRan common stock in the second quarter of      2007.  The conversion of the 5% preferred stock, which occurred      in June 2007, did not have a material impact on the average shares      outstanding for the second quarter and six months ended June 30,      2007.  See Note 8 of the 2007 Form 10-K for additional      information regarding the 5% preferredstock. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                    |   | Second      Quarter |   |   | Six      Months |   |
|-----------------------------------------|--------|---------------------|--------|--------|-----------------|--------|
|                                    |   | 2008                |   |   | 2007            |   |   | 2008 |   |   | 2007 |   |
| Outstanding      options (in thousands) |   |                | 40     |   |            |   | 5,503 |   |   |   | 220 |   |   |   | 5,721 |   |
| Average      exercise price             |   | $                   | 31.92  |   |            | $      | 17.57 |   |   | $ | 23.91 |   |   | $ | 17.43 |   |

|   | Natural      Gas Positions (million MMbtu)                                        |   |
|--------|-----------------------------------------------------------------------------------|--------|
|   | Open      Swap Positions a                                                        |   | Put      Options b |   |
|   |                                                                              |   | Average |   |   |   | Average |   |
|   | Volumes                                                                           |   | Swap      Price      c |   | Volumes |   | Floor      c |   |
| 2008   | 2.7                                                                               |   | $ | 9.16 |   |              6.6 |   | $ |  6.00 |   |
| 2009   |              7.3 |   | $ |  8.97 |   |              3.2 |   | $ |  6.00 |   |
| 2010   |              2.6 |   | $ |  8.63 |   |              1.2 |   | $ |  6.00 |   |

|   | Oil      Positions (thousand bbls)                                          |   |
|--------|-----------------------------------------------------------------------------|--------|
|   | Open      Swap Positions a                                                  |   | Put      Options b |   |
|   |                                                                        |   | Average |   |   |   | Average |   |
|   | Volumes                                                                     |   | Swap      Price      d |   | Volumes |   | Floor      d |   |
| 2008   | 120                                                                         |   | $ | 72.30 |   |             288 |   | $ |  50.00 |   |
| 2009   |             322 |   | $ |  71.82 |   |             125 |   | $ |  50.00 |   |
| 2010   |             118 |   | $ |  70.89 |   |               50 |   | $ |  50.00 |   |

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TABLE OF CONTENTS

| a.   | Covering      periods January-June and November-December of the respective      years.  Contracts for the period January-June 2008 have been      settled, resulting in realized losses of $31.2 million for the six months      ended June 30, 2008. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| b.   | Covering      periods July-October of the respectiveyears. |
|----------------|------------------------------------------------------------|

| c.   | Price      per MMbtu of natural gas. |
|----------------|--------------------------------------|

| d.   | Price      per barrel of oil. |
|----------------|-------------------------------|

|                                          | Second  Quarter |   |
|-----------------------------------------------|---------------------------|--------|
|                                          | Realized                  |   | Unrealized |   | Total |   |
| Gas      puts                                 | $                         | -      |   | $ | 728 |   | $ | 728 |   |
| Oil      puts                                 |                      | -      |   |   | 47 |   |   | 47 |   |
| Gas      swaps                                |                      | 14,648 |   |   | 25,203 |   |   | 39,851 |   |
| Oil      swaps                                |                      | 12,916 |   |   | 17,233 |   |   | 30,149 |   |
| Loss      on oil and gas derivative contracts | $                         | 27,564 |   | $ | 43,211 |   | $ | 70,775 |   |

|                                          | Six      Months |   |
|-----------------------------------------------|-----------------|--------|
|                                          | Realized        |   | Unrealized |   | Total |   |
| Gas      puts                                 | $               | -      |   | $ | 2,324 |   | $ | 2,324 |   |
| Oil      puts                                 |            | -      |   |   | 53 |   |   | 53 |   |
| Gas      swaps                                |            | 10,777 |   |   | 65,800 |   |   | 76,577 |   |
| Oil      swaps                                |            | 20,427 |   |   | 16,625 |   |   | 37,052 |   |
| Loss      on oil and gas derivative contracts | $               | 31,204 |   | $ | 84,802 |   | $ | 116,006 |   |

|                             | Puts   |   | Swaps  |   |   |   |   |
|----------------------------------|--------|--------|--------|--------|--------|--------|--------|
|                             | Gas    |   | Oil    |   | Gas    |   | Oil    |   | Total |   |
| Current      assets              | $      | -      |   | $      | -      |   | $      | - |   | $ | - |   | $ | - |   |
| Other      assets                |   | 130    |   |   | 32     |   |   | - |   |   | - |   |   | 162 |   |
| Current      liabilities         |   | -      |   |   | -      |   |   | (37,435 | ) |   | (26,982 | ) |   | (64,417 | ) |
| Other      long-term liabilities |   | -      |   |   | -      |   |   | (10,700 | ) |   | (10,424 | ) |   | (21,124 | ) |
| Fair      value of contracts     | $      | 130    |   | $      | 32     |   | $      | (48,135 | ) | $ | (37,406 | ) | $ | (85,379 | ) |

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| Oil and Natural      Gas                              |   |    |   |
|-------------------------------------------------------|--------|---------|--------|
| Asset      retirement obligation at beginning of year | $      | 294,737 |   |
| Liabilities      settled                              |   | (8,005  | )a     |
| Accretion      expense                                |   | 12,784  |   |
| Reclamation      costs assumed from third parties     |   | 2,859   | b      |
| Incurred      liabilities                             |   | 55      |   |
| Revision      for changes in estimates                |   | 2,133   |   |
| Asset      retirement obligations at June 30, 2008    | $      | 304,563 |   |

|                                                    |   |   |   |
|---------------------------------------------------------|--------|--------|--------|
| Sulphur                                                 |   |   |   |
| Asset      retirement obligations at beginning of year: | $      | 21,300 |   |
| Liabilities      settled                                |   | (1,577 | )      |
| Accretion      expense                                  |   | 434    |   |
| Revision      for changes in estimates                  |   | -      |   |
| Asset      retirement obligation at June 30, 2008       | $      | 20,157 |   |

|   | a.  Includes      $4.0 million of costs included in accounts payable at June 30, 2008 for      completed work. |
|--------|--------------------------------------------------------------------------------------------------------------------------|

|   | b.  Represents      reimbursement paid to McMoRan for future reclamation      expenditures.  McMoRan has assumed the third parties’      reclamation liability in these specificfields. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                        | Second      Quarter |   | Six      Months |   |
|---------------------------------------------|---------------------|--------|-----------------|--------|
|                                        | 2008                |   | 2007            |   | 2008 |   | 2007 |   |
| Interest      cost                          | $                   | (38    | )               | $      | (29 | ) | $ | (16 | ) | $ | 29 |   |
| Service      cost                           |                | -      |            |   | - |   |   | - |   |   | - |   |
| (Return)      loss on plan assets           |                | (9     | )               |   | (29 | ) |   | (18 | ) |   | (47 | ) |
| Change      in plan payout assumptions      |                | -      |            |   | - |   |   | - |   |   | - |   |
| Net      periodic benefit expense (benefit) | $                   | (47    | )               | $      | (58 | ) | $ | (34 | ) | $ | (18 | ) |

|                                     | Second      Quarter |   | Six      Months |   |
|------------------------------------------|---------------------|--------|-----------------|--------|
|                                     | 2008                |   | 2007            |   | 2008 |   | 2007 |   |
| Interest      cost                       | $                   | 7      |            | $      | 5 |   | $ | 14 |   | $ | 10 |   |
| Service      cost                        |                | 84     |            |   | 86 |   |   | 167 |   |   | 172 |   |
| (Return)      loss on plan assets        |                | -      |            |   | - |   |   | - |   |   | - |   |
| Amortization      of prior service costs |                |   |            |   |   |   |   |   |   |   |   |   |
| and      actuarial gains                 |                | (1     | )               |   | 14 |   |   | (3 | ) |   | 28 |   |
| Net      periodic benefit expense        | $                   | 90     |            | $      | 105 |   | $ | 178 |   | $ | 210 |   |

|                                                       | Second      Quarter |   |   | Six      Months |   |
|------------------------------------------------------------|---------------------|--------|--------|-----------------|--------|
|                                                       | 2008                |   | 2007   |            |   | 2008 |   | 2007 |   |
| Cost      of options awarded to employees (including       |                |   |   |            |   |   |   |   |   |   |   |   |   |
| directors)                                                 | $                   | 18,280 | a      | $               | 2,094  |   |   | $ | 20,060 | a | $ | 8,375 | a |
| Cost      of options awarded to non-employees and advisory |                |   |   |            |   |   |   |   |   |   |   |   |   |
| directors                                                  |                | 602    |   |            | 139    |   |   |   | 730 |   |   | 359 |   |
| Cost      of restricted stock units                        |                | 52     |   |            | -      |   |   |   | 85 |   |   | 6 |   |
| Total      compensation cost                               | $                   | 18,934 |   | $               | 2,233  |   |   | $ | 20,875 |   | $ | 8,740 |   |

| a.   | Includes      compensation charges associated with immediately vested stock options      totaling $16.2 million for the second quarter and six months ended June      30, 2008 and $4.4 million for the six months ended June 30,      2007.  These compensation costs include the stock options      granted to McMoRan’s Co-Chairmen in lieu of receiving any cash      compensation during the respective periods and the compensation costs      related to stock options granted to retiree-eligible employees, which      resulted in one-year’s compensation expense being immediately recognized      at the effective date of the stock optiongrant. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                                 | Second      Quarter |   |   | Six      Months |   |
|------------------------------------------------------|---------------------|--------|--------|-----------------|--------|
|                                                 | 2008                |   | 2007   |            |   | 2008 |   | 2007 |   |
| Net      income (loss)                               | $                   | 54,082 |   | $               | (5,339 | ) |   | $ | 90,457 |   | $ | (19,837 | ) |
| Other      comprehensive income (loss)               |                |   |   |            |   |   |   |   |   |   |   |   |   |
| Amortization      of previously unrecognized pension |                |   |   |            |   |   |   |   |   |   |   |   |   |
| components,      net                                 |                | (1     | )      |            | 14     |   |   |   | (2 | ) |   | 28 |   |
| Comprehensive      income (loss)                     | $                   | 54,081 |   | $               | (5,325 | ) |   | $ | 90,455 |   | $ | (19,809 | ) |

| ·   | Level      1:  valuations consist of unadjusted quoted prices in active markets      for identical assets and liabilities and has the highest      priority; |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Level      2:  valuations rely on quoted prices in markets that are not active      or observable inputs over the full term of the asset or      liability; |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Level      3:  valuations are based on prices or third party or internal      valuation models that require inputs that are significant to the fair      value measurement and are less observable and thus have the lowest      priority. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                                  |   |                |      |   |   | Freeport  |   |         |    | Consolidated |   |
|-------------------------------------------------------|--------|---------------------|-----------|--------|--------|-----------|--------|--------------|---------|--------------|--------|
|                                                  |   | Parent              |      | MOXY   |   | Energy    |   | Eliminations |    | McMoRan      |   |
|                                                  |   | (in      Thousands) |      |
| ASSETS                                                |   |                |      |   |   |      |   |         |    |         |   |   |   |   |   |   |
| Current      assets:                                  |   |                |      |   |   |      |   |         |    |         |   |   |   |   |   |   |
| Cash      and cash equivalents                        |   | $                   | 69        |   | $      | 432       |   | $            | 22      |         | $      | - |   | $ | 523 |   |
| Accounts      receivable                              |   |                | -         |   |   | 221,017   |   |         | -       |         |   | - |   |   | 221,017 |   |
| Inventories                                           |   |                | -         |   |   | 12,946    |   |         | -       |         |   | - |   |   | 12,946 |   |
| Prepaid      expenses                                 |   |                | 2,564     |   |   | 1,684     |   |         | -       |         |   | - |   |   | 4,248 |   |
| Current      assets from discontinued                 |   |                |      |   |   |      |   |         |    |         |   |   |   |   |   |   |
| operations                                            |   |                | -         |   |   | -         |   |         | 3,024   |         |   | - |   |   | 3,024 |   |
| Total      current assets                             |   |                | 2,633     |   |   | 236,079   |   |         | 3,046   |         |   | - |   |   | 241,758 |   |
| Property,      plant and equipment, net               |   |                | -         |   |   | 1,382,199 |   |         | 31      |         |   | - |   |   | 1,382,230 |   |
| Sulphur      business assets, net                     |   |                | -         |   |   | -         |   |         | 342     |         |   | - |   |   | 342 |   |
| Investment      in subsidiaries                       |   |                | 1,114,781 |   |   | -         |   |         | -       |         |   | (1,114,781 | ) |   | - |   |
| Amounts      due from affiliates                      |   |                | -         |   |   | 109,442   |   |         | 1,274   |         |   | (110,716 | ) |   | - |   |
| Deferred      financing costs and other               |   |                |      |   |   |      |   |         |    |         |   |   |   |   |   |   |
| assets                                                |   |                | 12,119    |   |   | 27,961    |   |         | 127     |         |   | - |   |   | 40,207 |   |
| Total      assets                                     |   | $                   | 1,129,533 |   | $      | 1,755,681 |   | $            | 4,820   |         | $      | (1,225,497 | ) | $ | 1,664,537 |   |
|                                                  |   |                |      |   |   |      |   |         |    |         |   |   |   |   |   |   |
| LIABILITIES      AND STOCKHOLDERS’ EQUITY       |   |                |      |   |   |      |   |         |    |         |
| Currentliabilities:                                   |   |                |      |   |   |      |   |         |    |         |   |   |   |   |   |   |
| Accounts      payable                                 |   |                | 265       |   |   | 112,159   |   |         | 207     |         |   | - |   | $ | 112,631 |   |
| Accrued      liabilities                              |   |                | 2,984     |   |   | 97,308    |   |         | 559     |         |   | - |   |   | 100,851 |   |
| Current      portion of debt                          |   |                | 43,503    |   |   | -         |   |         | -       |         |   | - |   |   | 43,503 |   |
| Current      portion of oil and gas                   |   |                |      |   |   |      |   |         |    |         |   |   |   |   |   |   |
| accrued      reclamation costs                        |   |                | -         |   |   | 73,780    |   |         | -       |         |   | - |   |   | 73,780 |   |
| Other      current liabilities                        |   |                | 9,035     |   |   | 65,280    |   |         | -       |         |   | - |   |   | 74,315 |   |
| Current      liabilities from discontinued            |   |                |      |   |   |      |   |         |    |         |   |   |   |   |   |   |
| operations                                            |   |                | -         |   |   | -         |   |         | 12,386  |         |   | - |   |   | 12,386 |   |
| Total      current liabilities                        |   |                | 55,787    |   |   | 348,527   |   |         | 13,152  |         |   | - |   |   | 417,466 |   |
| Long-term      debt                                   |   |                | 374,720   |   |   | 4,500     |   |         | -       |         |   | - |   |   | 379,220 |   |
| Amounts      due to affiliates                        |   |                | 110,716   |   |   | -         |   |         | -       |         |   | (110,716 | ) |   | - |   |
| Accrued      oil and gas reclamation costs            |   |                | -         |   |   | 230,783   |   |         | -       |         |   | - |   |   | 230,783 |   |
| Accrued      sulphur reclamation costs                |   |                | -         |   |   | -         |   |         | 9,498   |         |   | - |   |   | 9,498 |   |
| Other      long-term liabilities                      |   |                | 12,070    |   |   | 30,463    |   |         | 8,797   |         |   | - |   |   | 51,330 |   |
| Total      liabilities                                |   |                | 553,293   |   |   | 614,273   |   |         | 31,447  |         |   | (110,716 | ) |   | 1,088,297 |   |
| Commitments      and contingencies                    |   |                |      |   |   |      |   |         |    |         |   |   |   |   |   |   |
| Stockholders’      equity (deficit)             |   |                | 576,240   |   |   | 1,141,408 |   |         | (26,627 | )            |   | (1,114,781 | ) |   | 576,240 |   |
| Total      liabilities and stockholders’ equity |   | $                   | 1,129,533 |   | $      | 1,755,681 |   | $            | 4,820   |         | $      | (1,225,497 | ) | $ | 1,664,537 |   |

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TABLE OF CONTENTS

|                                                  |   |                |    |   |   | Freeport  |   |         |    |    |   |
|-------------------------------------------------------|--------|---------------------|---------|--------|--------|-----------|--------|--------------|---------|---------|--------|
|                                                  |   | McMoRan             |    | MOXY   |   | Energy    |   | Eliminations |    | McMoRan |   |
|                                                  |   | (in      Thousands) |    |
| ASSETS                                                |   |                |    |   |   |      |   |         |    |    |   |   |   |   |   |   |
| Current      assets:                                  |   |                |    |   |   |      |   |         |    |    |   |   |   |   |   |   |
| Cash      and cash equivalents                        |   | $                   | 143     |   | $      | 3,446     |   | $            | 1,241   |    | $      | - |   | $ | 4,830 |   |
| Accounts      receivable                              |   |                | 885     |   |   | 127,805   |   |         | -       |    |   | - |   |   | 128,690 |   |
| Inventories                                           |   |                | -       |   |   | 11,507    |   |         | -       |    |   | - |   |   | 11,507 |   |
| Prepaid      expenses                                 |   |                | 12,833  |   |   | 1,498     |   |         | -       |    |   | - |   |   | 14,331 |   |
| Fair      value of derivative contracts               |   |                | -       |   |   | 16,623    |   |         | -       |    |   | - |   |   | 16,623 |   |
| Current      assets from discontinued                 |   |                |    |   |   |      |   |         |    |    |   |   |   |   |   |   |
| operations                                            |   |                | -       |   |   | -         |   |         | 3,029   |    |   | - |   |   | 3,029 |   |
| Total      current assets                             |   |                | 13,861  |   |   | 160,879   |   |         | 4,270   |    |   | - |   |   | 179,010 |   |
| Property,      plant and equipment, net               |   |                | -       |   |   | 1,503,328 |   |         | 31      |    |   | - |   |   | 1,503,359 |   |
| Sulphur      business assets, net                     |   |                | -       |   |   | -         |   |         | 349     |    |   | - |   |   | 349 |   |
| Investment      in subsidiaries                       |   |                | 971,176 |   |   | -         |   |         | -       |    |   | (971,176 | ) |   | - |   |
| Amounts      due from affiliates                      |   |                | -       |   |   | 68,341    |   |         | 5,987   |    |   | (74,328 | ) |   | - |   |
| Deferred      financing costs and other               |   |                |    |   |   |      |   |         |    |    |   |   |   |   |   |   |
| Assets                                                |   |                | 14,135  |   |   | 18,308    |   |         | 127     |    |   | - |   |   | 32,570 |   |
| Total      assets                                     |   | $                   | 999,172 |   | $      | 1,750,856 |   | $            | 10,764  |    | $      | (1,045,504 | ) | $ | 1,715,288 |   |
|                                                  |   |                |    |   |   |      |   |         |    |    |   |   |   |   |   |   |
| LIABILITIES      AND STOCKHOLDERS’ EQUITY       |   |                |    |   |   |      |   |         |    |    |
| Currentliabilities:                                   |   |                |    |   |   |      |   |         |    |    |   |   |   |   |   |   |
| Accounts      payable                                 |   |                | 222     |   |   | 97,300    |   |         | 299     |    |   | - |   | $ | 97,821 |   |
| Accrued      liabilities                              |   |                | 2,110   |   |   | 65,006    |   |         | 1,176   |    |   | - |   |   | 68,292 |   |
| Current      portion of debt                          |   |                | 111,535 |   |   | -         |   |         | -       |    |   | - |   |   | 111,535 |   |
| Current      portion of oil and gas                   |   |                |    |   |   |      |   |         |    |    |   |   |   |   |   |   |
| accrued      reclamation costs                        |   |                | -       |   |   | 80,839    |   |         | -       |    |   | - |   |   | 80,839 |   |
| Other      current liabilities                        |   |                | 11,723  |   |   | 15,333    |   |         | -       |    |   | - |   |   | 27,056 |   |
| Current      liabilities from discontinued            |   |                |    |   |   |      |   |         |    |    |   |   |   |   |   |   |
| operations                                            |   |                | -       |   |   | -         |   |         | 14,769  |    |   | - |   |   | 14,769 |   |
| Total      current liabilities                        |   |                | 125,590 |   |   | 258,478   |   |         | 16,244  |    |   | - |   |   | 400,312 |   |
| Long-term      debt                                   |   |                | 415,000 |   |   | 274,000   |   |         | -       |    |   | - |   |   | 689,000 |   |
| Amounts      due to affiliates                        |   |                | 74,328  |   |   | -         |   |         | -       |    |   | (74,328 | ) |   | - |   |
| Accrued      oil and gas reclamation costs            |   |                | -       |   |   | 213,898   |   |         | -       |    |   | - |   |   | 213,898 |   |
| Accrued      sulphur reclamation costs                |   |                | -       |   |   | -         |   |         | 9,155   |    |   |   |   |   | 9,155 |   |
| Other      long-term liabilities                      |   |                | 12,025  |   |   | 9,245     |   |         | 9,424   |    |   | - |   |   | 30,694 |   |
| Total      liabilities                                |   |                | 626,943 |   |   | 755,621   |   |         | 34,823  |    |   | (74,328 | ) |   | 1,343,059 |   |
| Commitments      and contingencies                    |   |                |    |   |   |      |   |         |    |    |   |   |   |   |   |   |
| Stockholders’      equity (deficit)             |   |                | 372,229 |   |   | 995,235   |   |         | (24,059 | )       |   | (971,176 | ) |   | 372,229 |   |
| Total      liabilities and stockholders’ equity |   | $                   | 999,172 |   | $      | 1,750,856 |   | $            | 10,764  |    | $      | (1,045,504 | ) | $ | 1,715,288 |   |

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TABLE OF CONTENTS

|                                          |   |                |    |   |   | Freeport |   |         |   | Consolidated |   |
|-----------------------------------------------|--------|---------------------|---------|--------|--------|----------|--------|--------------|--------|--------------|--------|
|                                          |   | Parent              |    | MOXY   |   | Energy   |   | Eliminations |   | McMoRan      |   |
|                                          |   | (In      Thousands) |    |
| Revenues:                                     |   |                |    |   |   |     |   |         |   |         |   |   |   |   |   |   |
| Oil      and gas                              |   | $                   | -       |   | $      | 372,321  |   | $            | -      |         | $      | - |   | $ | 372,321 |   |
| Service                                       |   |                | -       |   |   | 3,187    |   |         | -      |         |   | - |   |   | 3,187 |   |
| Total      revenues                           |   |                | -       |   |   | 375,508  |   |         | -      |         |   | - |   |   | 375,508 |   |
| Costs      and expenses:                      |   |                |    |   |   |     |   |         |   |         |   |   |   |   |   |   |
| Production      and delivery costs            |   |                | -       |   |   | 69,517   |   |         | (12    | )            |   | - |   |   | 69,505 |   |
| Depreciation      and amortization            |   |                | -       |   |   | 121,001  |   |         | -      |         |   | - |   |   | 121,001 |   |
| Exploration      expenses                     |   |                | -       |   |   | 27,480   |   |         | -      |         |   | - |   |   | 27,480 |   |
| Loss      on oil and gas derivative contracts |   |                | -       |   |   | 70,775   |   |         | -      |         |   | - |   |   | 70,775 |   |
| General      and administrative expenses      |   |                | 1,763   |   |   | 16,407   |   |         | 67     |         |   | - |   |   | 18,237 |   |
| Start-up      costs for Main Pass             |   |                |    |   |   |     |   |         |   |         |   |   |   |   |   |   |
| Energy      Hub™                        |   |                | -       |   |   | -        |   |         | 1,645  |         |   | - |   |   | 1,645 |   |
| Insurance      recovery                       |   |                | -       |   |   | (3,391   | )      |         | -      |         |   | - |   |   | (3,391 | ) |
| Total      costs and expenses                 |   |                | 1,763   |   |   | 301,789  |   |         | 1,700  |         |   | - |   |   | 305,252 |   |
| Operating      income (loss)                  |   |                | (1,763  | )      |   | 73,719   |   |         | (1,700 | )            |   | - |   |   | 70,256 |   |
| Interest      expense                         |   |                | (10,732 | )      |   | (1,788   | )      |         | -      |         |   | - |   |   | (12,520 | ) |
| Equity      in earnings of consolidated       |   |                |    |   |   |     |   |         |   |         |   |   |   |   | - |   |
| subsidiaries                                  |   |                | 69,541  |   |   | -        |   |         | -      |         |   | (69,541 | ) |   | - |   |
| Other      income (expense), net              |   |                | (1,955  | )      |   | 58       |   |         | -      |         |   | - |   |   | (1,897 | ) |
| Income      (loss) from continuing operations |   |                |    |   |   |     |   |         |   |         |   |   |   |   |   |   |
| before      income taxes                      |   |                | 55,091  |   |   | 71,989   |   |         | (1,700 | )            |   | (69,541 | ) |   | 55,839 |   |
| Provision      for income taxes               |   |                | (1,009  | )      |   | -        |   |         | -      |         |   | - |   |   | (1,009 | ) |
| Income      (loss) from continuing operations |   |                | 54,082  |   |   | 71,989   |   |         | (1,700 | )            |   | (69,541 | ) |   | 54,830 |   |
| Loss      from discontinued operations        |   |                | -       |   |   | -        |   |         | (748   | )            |   | - |   |   | (748 | ) |
| Net      income (loss)                        |   |                | 54,082  |   |   | 71,989   |   |         | (2,448 | )            |   | (69,541 | ) |   | 54,082 |   |
| Preferred      dividends and amortization     |   |                |    |   |   |     |   |         |   |         |   |   |   |   |   |   |
| of      convertible preferred stock           |   |                |    |   |   |     |   |         |   |         |   |   |   |   |   |   |
| issuance      costs                           |   |                | (4,357  | )      |   | -        |   |         | -      |         |   | - |   |   | (4,357 | ) |
| Net      income (loss) applicable to          |   |                |    |   |   |     |   |         |   |         |   |   |   |   |   |   |
| common      stock                             |   | $                   | 49,725  |   | $      | 71,989   |   | $            | (2,448 | )            | $      | (69,541 | ) | $ | 49,725 |   |
|                                          |   |                |    |   |   |     |   |         |   |         |   |   |   |   |   |   |

----

TABLE OF CONTENTS

|                                          |   |                |    |   |   | Freeport |   |         |   | Consolidated |   |
|-----------------------------------------------|--------|---------------------|---------|--------|--------|----------|--------|--------------|--------|--------------|--------|
|                                          |   | Parent              |    | MOXY   |   | Energy   |   | Eliminations |   | McMoRan      |   |
|                                          |   | (In      Thousands) |    |
| Revenues:                                     |   |                |    |   |   |     |   |         |   |         |   |   |   |   |   |   |
| Oil      and gas                              |   | $                   | -       |   | $      | 664,267  |   | $            | -      |         | $      | - |   | $ | 664,267 |   |
| Service                                       |   |                | -       |   |   | 6,717    |   |         | -      |         |   | - |   |   | 6,717 |   |
| Total      revenues                           |   |                | -       |   |   | 670,984  |   |         | -      |         |   | - |   |   | 670,984 |   |
| Costs      and expenses:                      |   |                |    |   |   |     |   |         |   |         |   |   |   |   |   |   |
| Production      and delivery costs            |   |                | -       |   |   | 125,177  |   |         | (26    | )            |   | - |   |   | 125,151 |   |
| Depreciation      and amortization            |   |                | -       |   |   | 242,333  |   |         | -      |         |   | - |   |   | 242,333 |   |
| Exploration      expenses                     |   |                | -       |   |   | 34,293   |   |         | -      |         |   | - |   |   | 34,293 |   |
| Loss      on oil and gas derivative contracts |   |                | -       |   |   | 116,006  |   |         | -      |         |   | - |   |   | 116,006 |   |
| General      and administrative expenses      |   |                | 3,663   |   |   | 23,415   |   |         | 171    |         |   | - |   |   | 27,249 |   |
| Start-up      costs for Main Pass             |   |                |    |   |   |     |   |         |   |         |   |   |   |   |   |   |
| Energy      Hub™                        |   |                | -       |   |   | -        |   |         | 3,262  |         |   | - |   |   | 3,262 |   |
| Insurance      recovery                       |   |                | -       |   |   | (3,391   | )      |         | -      |         |   | - |   |   | (3,391 | ) |
| Total      costs and expenses                 |   |                | 3,663   |   |   | 537,833  |   |         | 3,407  |         |   | - |   |   | 544,903 |   |
| Operating      income (loss)                  |   |                | (3,663  | )      |   | 133,151  |   |         | (3,407 | )            |   | - |   |   | 126,081 |   |
| Interest      expense                         |   |                | (23,138 | )      |   | (6,493   | )      |         | -      |         |   | - |   |   | (29,631 | ) |
| Equity      in earnings of consolidated       |   |                |    |   |   |     |   |         |   |         |   |   |   |   | - |   |
| subsidiaries                                  |   |                | 121,760 |   |   | -        |   |         | -      |         |   | (121,760 | ) |   | - |   |
| Other      income (expense), net              |   |                | (2,637  | )      |   | 113      |   |         | -      |         |   | - |   |   | (2,524 | ) |
| Income      (loss) from continuing operations |   |                |    |   |   |     |   |         |   |         |   |   |   |   |   |   |
| before      income taxes                      |   |                | 92,322  |   |   | 126,771  |   |         | (3,407 | )            |   | (121,760 | ) |   | 93,926 |   |
| Provision      for income taxes               |   |                | (1,865  | )      |   | -        |   |         | -      |         |   | - |   |   | (1,865 | ) |
| Income      (loss) from continuing operations |   |                | 90,457  |   |   | 126,771  |   |         | (3,407 | )            |   | (121,760 | ) |   | 92,061 |   |
| Loss      from discontinued operations        |   |                | -       |   |   | -        |   |         | (1,604 | )            |   | - |   |   | (1,604 | ) |
| Net      income (loss)                        |   |                | 90,457  |   |   | 126,771  |   |         | (5,011 | )            |   | (121,760 | ) |   | 90,457 |   |
| Preferred      dividends and amortization     |   |                |    |   |   |     |   |         |   |         |   |   |   |   |   |   |
| of      convertible preferred stock           |   |                |    |   |   |     |   |         |   |         |   |   |   |   |   |   |
| issuance      costs                           |   |                | (8,723  | )      |   | -        |   |         | -      |         |   | - |   |   | (8,723 | ) |
| Net      income (loss) applicable to          |   |                |    |   |   |     |   |         |   |         |   |   |   |   |   |   |
| common      stock                             |   | $                   | 81,734  |   | $      | 126,771  |   | $            | (5,011 | )            | $      | (121,760 | ) | $ | 81,734 |   |
|                                          |   |                |    |   |   |     |   |         |   |         |   |   |   |   |   |   |

----

TABLE OF CONTENTS

|                                          |   |                |   |   |   | Freeport |   |         |   | Consolidated |   |
|-----------------------------------------------|--------|---------------------|--------|--------|--------|----------|--------|--------------|--------|--------------|--------|
|                                          |   | Parent              |   | MOXY   |   | Energy   |   | Eliminations |   | McMoRan      |   |
|                                          |   | (In      Thousands) |   |
| Revenues:                                     |   |                |   |   |   |     |   |         |   |         |   |   |   |   |   |   |
| Oil      and gas                              |   | $                   | -      |   | $      | 44,988   |   | $            | -      |         | $      | - |   | $ | 44,988 |   |
| Service                                       |   |                | -      |   |   | 360      |   |         | -      |         |   | - |   |   | 360 |   |
| Total      revenues                           |   |                | -      |   |   | 45,348   |   |         | -      |         |   | - |   |   | 45,348 |   |
| Costs      and expenses:                      |   |                |   |   |   |     |   |         |   |         |   |   |   |   |   |   |
| Production      and delivery costs            |   |                | -      |   |   | 16,630   |   |         | (12    | )            |   | - |   |   | 16,618 |   |
| Depreciation      and amortization            |   |                | -      |   |   | 15,530   |   |         | -      |         |   | - |   |   | 15,530 |   |
| Exploration      expenses                     |   |                | -      |   |   | 5,348    |   |         | -      |         |   | - |   |   | 5,348 |   |
| General      and administrative expenses      |   |                | 1,049  |   |   | 3,317    |   |         | 49     |         |   | - |   |   | 4,415 |   |
| Loss      on oil and gas derivative contracts |   |                | -      |   |   | -        |   |         | -      |         |   | - |   |   | - |   |
| Start-up      costs for Main Pass             |   |                |   |   |   |     |   |         |   |         |   |   |   |   |   |   |
| Energy      Hub™                        |   |                | -      |   |   | -        |   |         | 2,752  |         |   | - |   |   | 2,752 |   |
| Total      costs and expenses                 |   |                | 1,049  |   |   | 40,825   |   |         | 2,789  |         |   | - |   |   | 44,663 |   |
| Operating      loss                           |   |                | (1,049 | )      |   | 4,523    |   |         | (2,789 | )            |   | - |   |   | 685 |   |
| Interest      expense                         |   |                | (3,463 | )      |   | (2,292   | )      |         | -      |         |   | - |   |   | (5,755 | ) |
| Equity      in losses of                      |   |                |   |   |   |     |   |         |   |         |   |   |   |   |   |   |
| consolidated      subsidiaries                |   |                | (1,359 | )      |   | -        |   |         | -      |         |   | 1,359 |   |   | - |   |
| Other      income, net                        |   |                | 532    |   |   | 301      |   |         |   |         |   |   |   |   | 833 |   |
| Income      (loss) from continuing operations |   |                |   |   |   |     |   |         |   |         |   |   |   |   |   |   |
| before      income taxes                      |   |                | (5,339 | )      |   | 2,532    |   |         | (2,789 | )            |   | 1,359 |   |   | (4,237 | ) |
| Provision      for income taxes               |   |                | -      |   |   | -        |   |         | -      |         |   | - |   |   | - |   |
| Income      (loss) from continuing operations |   |                | (5,339 | )      |   | 2,532    |   |         | (2,789 | )            |   | 1,359 |   |   | (4,237 | ) |
| Income      from discontinued operations      |   |                | -      |   |   | 179      |   |         | (1,281 | )            |   | - |   |   | (1,102 | ) |
| Net      income (loss)                        |   |                | (5,339 | )      |   | 2,711    |   |         | (4,070 | )            |   | 1,359 |   |   | (5,339 | ) |
| Preferred      dividends and amortization     |   |                |   |   |   |     |   |         |   |         |   |   |   |   |   |   |
| of      convertible preferred stock           |   |                |   |   |   |     |   |         |   |         |   |   |   |   |   |   |
| issuance      costs                           |   |                | (1,147 | )      |   | -        |   |         | -      |         |   | - |   |   | (1,147 | ) |
| Net      income (loss) applicable to          |   |                |   |   |   |     |   |         |   |         |   |   |   |   |   |   |
| common      stock                             |   | $                   | (6,486 | )      | $      | 2,711    |   | $            | (4,070 | )            | $      | 1,359 |   | $ | (6,486 | ) |
|                                          |   |                |   |   |   |     |   |         |   |         |   |   |   |   |   |   |

----

TABLE OF CONTENTS

|                                          |   |                |     |   |   | Freeport |   |         |   | Consolidated |   |
|-----------------------------------------------|--------|---------------------|----------|--------|--------|----------|--------|--------------|--------|--------------|--------|
|                                          |   | Parent              |     | MOXY   |   | Energy   |   | Eliminations |   | McMoRan      |   |
|                                          |   | (In      Thousands) |     |
| Revenues:                                     |   |                |     |   |   |     |   |         |   |         |   |   |   |   |   |   |
| Oil      and gas                              |   | $                   | -        |   | $      | 96,363   |   | $            | -      |         | $      | - |   | $ | 96,363 |   |
| Service                                       |   |                | -        |   |   | 682      |   |         | -      |         |   | - |   |   | 682 |   |
| Total      revenues                           |   |                | -        |   |   | 97,045   |   |         | -      |         |   | - |   |   | 97,045 |   |
| Costs      and expenses:                      |   |                |     |   |   |     |   |         |   |         |   |   |   |   |   |   |
| Production      and delivery costs            |   |                | -        |   |   | 34,373   |   |         | (27    | )            |   | - |   |   | 34,346 |   |
| Depreciation      and amortization            |   |                | -        |   |   | 42,565   |   |         | -      |         |   | - |   |   | 42,565 |   |
| Exploration      expenses                     |   |                | -        |   |   | 15,103   |   |         | -      |         |   | - |   |   | 15,103 |   |
| General      and administrative expenses      |   |                | 2,270    |   |   | 8,443    |   |         | 99     |         |   | - |   |   | 10,812 |   |
| Loss      on oil and gas derivative contracts |   |                | -        |   |   | -        |   |         | -      |         |   | - |   |   | - |   |
| Start-up      costs for Main Pass             |   |                |     |   |   |     |   |         |   |         |   |   |   |   |   |   |
| Energy      Hub™                        |   |                | -        |   |   | -        |   |         | 5,457  |         |   | - |   |   | 5,457 |   |
| Total      costs and expenses                 |   |                | 2,270    |   |   | 100,484  |   |         | 5,529  |         |   | - |   |   | 108,283 |   |
| Operating      loss                           |   |                | (2,270   | )      |   | (3,439   | )      |         | (5,529 | )            |   | - |   |   | (11,238 | ) |
| Interest      expense                         |   |                | (6,936   | )      |   | (4,473   | )      |         | -      |         |   | - |   |   | (11,409 | ) |
| Equity      in losses of                      |   |                |     |   |   |     |   |         |   |         |   |   |   |   |   |   |
| consolidated      subsidiaries                |   |                | (11,648  | )      |   | -        |   |         | -      |         |   | 11,648 |   |   | - |   |
| Other      income, net                        |   |                | 1,017    |   |   | 564      |   |         | -      |         |   | - |   |   | 1,581 |   |
| Income      (loss) from continuing operations |   |                |     |   |   |     |   |         |   |         |   |   |   |   |   |   |
| before      income taxes                      |   |                | (19,837  | )      |   | (7,348   | )      |         | (5,529 | )            |   | 11,648 |   |   | (21,066 | ) |
| Provision      for income taxes               |   |                | -        |   |   | -        |   |         | -      |         |   | - |   |   | - |   |
| Income      (loss) from continuing operations |   |                | (19,837) |   |   | (7,348   | )      |         | (5,529 | )            |   | 11,648 |   |   | (21,066 | ) |
| Income      from discontinued operations      |   |                | -        |   |   | 301      |   |         | 928    |         |   | - |   |   | 1,229 |   |
| Net      income (loss)                        |   |                | (19,837  | )      |   | (7,047   | )      |         | (4,601 | )            |   | 11,648 |   |   | (19,837 | ) |
| Preferred      dividends and amortization     |   |                |     |   |   |     |   |         |   |         |   |   |   |   |   |   |
| of      convertible preferred stock           |   |                |     |   |   |     |   |         |   |         |   |   |   |   |   |   |
| issuance      costs                           |   |                | (1,552   | )      |   | -        |   |         | -      |         |   | - |   |   | (1,552 | ) |
| Net      income (loss) applicable to          |   |                |     |   |   |     |   |         |   |         |   |   |   |   |   |   |
| common      stock                             |   | $                   | (21,389  | )      | $      | (7,047   | )      | $            | (4,601 | )            | $      | 11,648 |   | $ | (21,389 | ) |
|                                          |   |                |     |   |   |     |   |         |   |         |   |   |   |   |   |   |

----

TABLE OF CONTENTS

|                                            |   |                |   |   |   | Freeport |   | Consolidated |   |
|-------------------------------------------------|--------|---------------------|--------|--------|--------|----------|--------|--------------|--------|
|                                            |   | Parent              |   | MOXY   |   | Energy   |   | McMoRan      |   |
|                                            |   | (In      Thousands) |   |
|                                            |   |                |   |   |   |     |   |         |   |   |   |   |   |
| Cash      flow from operating activities:       |   |                |   |   |   |     |   |         |   |   |   |   |   |
| Net      cash provided by (used in)             |   |                |   |   |   |     |   |         |   |   |   |   |   |
| continuing      operations                      |   | $                   | 8,812  |   | $      | 376,432  |   | $            | (3,473 | ) | $ | 381,771 |   |
| Net      cash provided by discontinued          |   |                |   |   |   |     |   |         |   |   |   |   |   |
| operations                                      |   |                | -      |   |   | -        |   |         | 454    |   |   | 454 |   |
| Net      cash provided by (used in)             |   |                |   |   |   |     |   |         |   |   |   |   |   |
| operating      activities                       |   |                | 8,812  |   |   | 376,432  |   |         | (3,019 | ) |   | 382,225 |   |
|                                            |   |                |   |   |   |     |   |         |   |   |   |   |   |
| Cash      flow from investing activities:       |   |                |   |   |   |     |   |         |   |   |   |   |   |
| Exploration,      development and other         |   |                |   |   |   |     |   |         |   |   |   |   |   |
| capital      expenditures                       |   |                | -      |   |   | (111,059 | )      |         | -      |   |   | (111,059 | ) |
| Acquisition      of oil and gas properties, net |   |                | -      |   |   | 1,112    |   |         | -      |   |   | 1,112 |   |
| Net      cash used in investing activities      |   |                | -      |   |   | (109,947 | )      |         | -      |   |   | (109,947 | ) |
|                                            |   |                |   |   |   |     |   |         |   |   |   |   |   |
| Cash      flow from financing activities:       |   |                |   |   |   |     |   |         |   |   |   |   |   |
| Net      payments under revolving credit        |   |                |   |   |   |     |   |         |   |   |   |   |   |
| facility                                        |   |                | -      |   |   | (269,500 | )      |         | -      |   |   | (269,500 | ) |
| Dividends      paid on convertible preferred    |   |                |   |   |   |     |   |         |   |   |   |   |   |
| stock                                           |   |                | (9,108 | )      |   | -        |   |         | -      |   |   | (9,108 | ) |
| Payments      for induced conversion of         |   |                |   |   |   |     |   |         |   |   |   |   |   |
| convertible      senior notes                   |   |                | (2,663 | )      |   | -        |   |         | -      |   |   | (2,663 | ) |
| Proceeds      from exercise of stock            |   |                |   |   |   |     |   |         |   |   |   |   |   |
| options,      warrants and other                |   |                | 4,686  |   |   | -        |   |         | -      |   |   | 4,686 |   |
| Investment      from parent                     |   |                | (1,802 | )      |   | -        |   |         | 1,802  |   |   | - |   |
| Net      cash provided by (used in)             |   |                |   |   |   |     |   |         |   |   |   |   |   |
| financing      activities                       |   |                | (8,887 | )      |   | (269,500 | )      |         | 1,802  |   |   | (276,585 | ) |
|                                            |   |                |   |   |   |     |   |         |   |   |   |   |   |
| Net      decrease in cash and cash              |   |                |   |   |   |     |   |         |   |   |   |   |   |
| equivalents                                     |   |                | (75    | )      |   | (3,015   | )      |         | (1,217 | ) |   | (4,307 | ) |
| Cash      and cash equivalents at beginning     |   |                |   |   |   |     |   |         |   |   |   |   |   |
| of      year                                    |   |                | 143    |   |   | 3,446    |   |         | 1,241  |   |   | 4,830 |   |
| Cash      and cash equivalents at end of        |   |                |   |   |   |     |   |         |   |   |   |   |   |
| year                                            |   | $                   | 68     |   | $      | 431      |   | $            | 24     |   | $ | 523 |   |
|                                            |   |                |   |   |   |     |   |         |   |   |   |   |   |

----

TABLE OF CONTENTS

|                                         |   |                |   |   |   | Freeport |   | Consolidated |   |
|----------------------------------------------|--------|---------------------|--------|--------|--------|----------|--------|--------------|--------|
|                                         |   | Parent              |   | MOXY   |   | Energy   |   | McMoRan      |   |
|                                         |   | (In      Thousands) |   |
|                                         |   |                |   |   |   |     |   |         |   |   |   |   |   |
| Cash      flow from operating activities:    |   |                |   |   |   |     |   |         |   |   |   |   |   |
| Net      cash provided by (used in)          |   |                |   |   |   |     |   |         |   |   |   |   |   |
| continuing      operations                   |   | $                   | 15,700 |   | $      | 24,511   |   | $            | (2,144 | ) | $ | 38,067 |   |
| Net      cash provided by discontinued       |   |                |   |   |   |     |   |         |   |   |   |   |   |
| operations                                   |   |                | -      |   |   | 302      |   |         | 274    |   |   | 576 |   |
| Net      cash provided by (used in)          |   |                |   |   |   |     |   |         |   |   |   |   |   |
| operating      activities                    |   |                | 15,700 |   |   | 24,813   |   |         | (1,870 | ) |   | 38,643 |   |
|                                         |   |                |   |   |   |     |   |         |   |   |   |   |   |
| Cash      flow from investing activities:    |   |                |   |   |   |     |   |         |   |   |   |   |   |
| Exploration,      development and other      |   |                |   |   |   |     |   |         |   |   |   |   |   |
| capital      expenditures                    |   |                | -      |   |   | (76,576) |   |         | -      |   |   | (76,576 | ) |
| Proceeds      from restricted investments    |   |                | 3,019  |   |   | -        |   |         |   |   |   | 3,019 |   |
| Increase      in restricted investments      |   |                | (87    | )      |   | -        |   |         | -      |   |   | (87 | ) |
| Net      cash used in investing activities   |   |                | 2,932  |   |   | (76,576  | )      |         | -      |   |   | (73,644 | ) |
|                                         |   |                |   |   |   |     |   |         |   |   |   |   |   |
| Cash      flow from financing activities:    |   |                |   |   |   |     |   |         |   |   |   |   |   |
| Net      payments under revolving credit     |   |                |   |   |   |     |   |         |   |   |   |   |   |
| facility                                     |   |                | -      |   |   | (28,750  | )      |         | -      |   |   | (28,750 | ) |
| Proceeds      from senior secured term loan  |   |                | -      |   |   | 100,000  |   |         | -      |   |   | 100,000 |   |
| Financing      costs                         |   |                | -      |   |   | (2,635   | )      |         | -      |   |   | (2,635 | ) |
| Dividends      paid on convertible preferred |   |                |   |   |   |     |   |         |   |   |   |   |   |
| stock                                        |   |                | (747   | )      |   | -        |   |         | -      |   |   | (747 | ) |
| Proceeds      from exercise of stock         |   |                |   |   |   |     |   |         |   |   |   |   |   |
| options,      warrants and other             |   |                | 1,280  |   |   | -        |   |         | -      |   |   | 1,280 |   |
| Investment      from parent                  |   |                | (3,800 | )      |   | -        |   |         | 3,800  |   |   | - |   |
| Net      cash provided by (used in)          |   |                |   |   |   |     |   |         |   |   |   |   |   |
| financing      activities                    |   |                | (3,267 | )      |   | 68,615   |   |         | 3,800  |   |   | 69,148 |   |
|                                         |   |                |   |   |   |     |   |         |   |   |   |   |   |
| Net      increase in cash and cash           |   |                |   |   |   |     |   |         |   |   |   |   |   |
| equivalents                                  |   |                | 15,365 |   |   | 16,852   |   |         | 1,930  |   |   | 34,147 |   |
| Cash      and cash equivalents at beginning  |   |                |   |   |   |     |   |         |   |   |   |   |   |
| of      year                                 |   |                | 16,593 |   |   | 1,030    |   |         | 207    |   |   | 17,830 |   |
| Cash      and cash equivalents at end of     |   |                |   |   |   |     |   |         |   |   |   |   |   |
| year                                         |   | $                   | 31,958 |   | $      | 17,882   |   | $            | 2,137  |   | $ | 51,977 |   |
|                                         |   |                |   |   |   |     |   |         |   |   |   |   |   |

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTINGFIRM

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 Management's Discussion andAnalysis of Financial Condition and Results ofOperations.

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| Flatrock      Wells                                                     | Total      Pay Intervals | Net      Feet of Pay a | Status      b                                                                                                                                                                                                                                                              |
|-------------------------------------------------------------------------|--------------------------|------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| No.      1 – “A” locationDiscovery      Well          | 8                        | 260                    | Gross      production averaged approximately 38 MMcfe/d,~7 MMcfe/d  net to      us in second quarter 2008                                                                                                                                                        |
|                                                                    |                     |                   |                                                                                                                                                                                                                                                                       |
| No.      2 – “B” locationDelineation      Well        | 8                        | 289                    | Commenced      production July 6, 2008; current gross rate 101 MMcef/d, 19 MMcfe/d      net                                                                                                                                                                           |
|                                                                    |                     |                   |                                                                                                                                                                                                                                                                       |
| No.      3 – “D” locationDelineation      Well        | 8                        | 256                    | Drilled      to total depth of 18,587’; brought on production in the Operc section in      late July 2008; currently producing at approximately 37      MMcfe/d, 7 MMcfe/d net to us; operator is currently increasing      production to an optimal rate. |
|                                                                    |                     |                   |                                                                                                                                                                                                                                                                       |
| No.      4 – “C” locationDevelopment      Well        | 2                        | 116                    | Spud      April 9, 2008; drilled to a total depth of 18,500’ in third quarter      2008                                                                                                                                                                         |
|                                                                    |                     |                   |                                                                                                                                                                                                                                                                       |
| No.      5 – “E” location      cDevelopment      Well | n/a                      | n/a                    | Spud      July 1, 2008; drilling below 11,900’ with a proposed total depth of      18,400’                                                                                                                                                                     |
|                                                                    |                     |                   |                                                                                                                                                                                                                                                                       |
| No.      6 – “F” location      dDelineation      Well | n/a                      | n/a                    | To      spud in second half 2008; will target Rob-L and Operc sands with proposed      total depth of 19,500’                                                                                                                                                        |

| a.   | Confirmed      with wireline logs. |
|----------------|------------------------------------|

| b.   | Status      is reported as of August 6, 2008. |
|----------------|-----------------------------------------------|

| c.   | Located      1,800 feet west of the Flatrock No. 4 well and between the Flatrock No. 1      and No. 2 wells. |
|----------------|--------------------------------------------------------------------------------------------------------------|

| d.   | Located      on South Marsh Island Block 217 and 3,100 feet southeast of the Flatrock      No. 3 well. |
|----------------|--------------------------------------------------------------------------------------------------------|

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|                                                          |   | Bcfe                                            |   |
|---------------------------------------------------------------|--------|-------------------------------------------------|--------|
| Proved      Reserves at 12/31/07                              |   |        363.9 |   |
|      First      Half 2008 Production |   |       (53.2       | )      |
|      Additions/Revisions             |   |        87.8  |   |
| Proved      Reserves at 6/30/08                               |   |      398.5             |   |

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|                                       |  Second |    |   | Six    |    |
|--------------------------------------------|--------------|---------|--------|--------|---------|
|                                       | Quarter      |    |   | Months |    |
| Revenues:                                  |         |    |   |   |    |   |
| Oil      and natural gas                   | $            | 273,124 |   | $      | 487,155 |   |
| Service                                    |         | 2,811   |   |   | 5,634   |   |
| Total      revenues                        |         | 275,935 |   |   | 492,789 |   |
| Cost      and Expenses:                    |         |    |   |   |    |   |
| Production      and delivery costs         |         | 38,806  | a      |   | 73,131  | b |
| Depreciation      and amortization         |         | 90,828  |   |   | 182,650 |   |
| Exploration      expenses                  |         | 3,248   |   |   | 3,303   |   |
| General      and administrative expenses c |         | 1,130   |   |   | 2,381   |   |
| Total      costs and expenses              |         | 134,012 |   |   | 261,465 |   |
| Operating      income                      | $            | 141,923 |   | $      | 231,324 |   |

| a.   | Includes      lease operating expenses of $28.3 million, $4.5 million for workover costs      and $6.0 million for transportation, production taxes and other related      costs for the second quarter of2008. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| b.   | Includes      lease operating expenses of $52.6 million, $7.1 million for workover costs      and $13.4 million for transportation, production taxes and other related      costs for the six months ended June 30,2008. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| c.   | Only      includes cost directly allocated to the acquired properties and excludes      all compensation costs. Amounts primarily reflect costs related to our      office in Houston, Texas. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                       | Second      Quarter |   | Six      Months |   |
|--------------------------------------------|---------------------|--------|-----------------|--------|
|                                       | 2008a               |   | 2007            |   | 2008      a |   | 2007 |   |
| Sales      volumes:                        |                |   |            |   |   |   |   |   |
| Gas      (thousand cubic feet, or Mcf)     | 17,858,000          |   | 2,907,700       |   | 35,401,400 | b | 6,756,800 |   |
| Oil      (barrels)a                        | 1,125,400           |   | 308,200         |   | 2,214,500 |   | 652,600 |   |
| Plant      products (per Mcf equivalent) c | 2,114,000           |   | 245,200         |   | 4,479,000 | b | 680,700 |   |
| Average      realizations:                 |                |   |            |   |   |   |   |   |
| Gas      (per Mcf)                         | $      12.11        |   | $      8.07     |   | $      10.60 |   | $      7.80 |   |
| Oil      (per barrel)a                     | 122.99              |   | 62.87           |   | 110.40 |   | 58.32 |   |

| a.   | Sales      volumes associated with the properties acquired in August 2007 totaled      approximately 13.3 billion cubic feet (Bcf) of natural gas, 778,600      barrels of oil and condensate and 1.5 billion cubic feet equivalent (Bcfe)      of plant products for the second quarter ended June 30,      2008.  For the six months ended June 30, 2008, the sales volumes      associated with the properties acquired in August 2007 totaled      approximately 26.5 Bcf of natural gas, 1,555,000 barrels of oil and      condensate and 3.5 Bcfe of plantproducts. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| b.   | Results      reflect a reduction of natural gas volumes of 0.3 Bcf and plant products      volumes of 0.1 Bcfe to reverse royalty relief amounts recorded in the      first quarter.  Pursuant to Minerals Management Service (MMS)      regulations, if the annual average NYMEX market price for natural gas      exceeds the MMS’s annual price threshold ($10.38 per MMbtu for 2008), then      relief is suspended under the program for 2008 and royalties would be due      to the MMS.  Given the strength of natural gas prices during the      second quarter of 2008 and forward prices as of June 30, 2008, we estimate      that we will not be eligible to receive this relief in    2008. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| c.   | Results      include approximately $21.0 million and $44.1 million of revenues      associated with plant products (ethane, propane, butane, etc.) during the      second quarter and six months ended June 30, 2008,      respectively.  Plant product revenues for the comparable prior      year periods totaled $2.0 million and $5.3 million.  One Mcf      equivalent is determined using the ratio of six Mcf of natural gas to one      barrel of crude oil, condensate or natural gas  liquids. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                          |  Second |    |   | Six    |    |
|---------------------------------------------------------------|--------------|---------|--------|--------|---------|
|                                                          | Quarter      |    |   | Months |    |
| Oil      and natural gas revenues – prior year period   | $            | 44,988  |   | $      | 96,363  |   |
| Increase      (decrease)                                      |         |    |   |   |    |   |
| Price      realizations:                                      |         |    |   |   |    |   |
| Natural      gas                                              |         | 18,879  |   |   | 27,844  |   |
| Oil      and condensate                                       |         | 18,907  |   |   | 31,528  |   |
| Sales      volumes:                                           |         |    |   |   |    |   |
| Natural      gas                                              |         | 10,390  |   |   | 16,742  |   |
| Oil      and condensate                                       |         | 2,461   |   |   | 440     |   |
| Properties      acquired in 2007                              |         | 273,124 |   |   | 487,155 |   |
| Plant      products revenues                                  |         | 3,277   |   |   | 3,907   |   |
| Other                                                         |         | 295     |   |   | 288     |   |
| Oil      and natural gas revenues – current year period | $            | 372,321 |   | $      | 664,267 |   |

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|                                     | Second      Quarter |   | Six      Months |
|------------------------------------------|---------------------|--------|-----------------|
|                                     |                |   | Per             |   |   |   | Per |   |   |   | Per |   |   |   | Per |
|                                     | 2008                |   | Mcfe            |   | 2007 |   | Mcfe |   | 2008 |   | Mcfe |   | 2007 |   | Mcfe |
| Lease      operating expense             | $36.8               |   | $1.37           |   | $7.5 |   | $1.51 |   | $68.8 |   | $1.29 |   | $15.9 |   | $1.40 |
| Workover      costs                      | 16.7                |   | 0.62            |   | 3.1 |   | 0.63 |   | 21.0 |   | 0.40 |   | 6.5 |   | 0.58 |
| Insurance                                | 4.9                 |   | 0.18            |   | 3.7 |   | 0.73 |   | 12.8 |   | 0.24 |   | 6.9 |   | 0.61 |
| Transportation      and production taxes | 10.4                |   | 0.40            |   | 1.7 |   | 0.34 |   | 21.0 |   | 0.39 |   | 4.1 |   | 0.37 |
| Other                                    | 0.7                 |   | 0.03            |   | 0.6 |   | 0.11 |   | 1.6 |   | 0.03 |   | 0.9 |   | 0.08 |
| Total      production and delivery costs | $69.5               |   | $2.60           |   | $16.6 |   | $3.32 |   | $125.2 |   | $2.35 |   | $34.3 |   | $3.04 |

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|                                    | Second      Quarter |   | Six      Months |
|-----------------------------------------|---------------------|--------|-----------------|
|                                    |                |   | Per             |   |   |   | Per |   |   |   | Per |   |   |   | Per |
|                                    | 2008                |   | Mcfe            |   | 2007 |   | Mcfe |   | 2008 |   | Mcfe |   | 2007 |   | Mcfe |
| Depletion      and depreciation expense | $106.3              |   | $3.97           |   | $14.9 |   | $2.98 |   | $221.6 |   | $4.17 |   | $38.4 |   | $3.38 |
| Accretion      expense                  | 7.3                 |   | 0.27            |   | 0.6 |   | 0.12 |   | 13.3 |   | 0.25 |   | 4.2 |   | 0.37 |
| Impairment      charges/losses          | 7.4                 |   | 0.28            |   | - |   | - |   | 7.4 |   | 0.14 |   | - |   | - |
| Total                                   | $121.0              |   | $4.52           |   | $15.5 |   | $3.10 |   | $242.3 |   | $4.56 |   | $42.6 |   | $3.75 |

|                                            | Second      Quarter |   | Six      Months |   |
|-------------------------------------------------|---------------------|--------|-----------------|--------|
|                                            | 2008                |   | 2007            |   | 2008 |   | 2007 |   |
| Geological      and geophysical                 |                |   |            |   |   |   |   |   |   |   |   |   |
| including      3-D seismic purchases a          | $                   | 12.5   |            | $      | 3.0 |   | $ | 18.0 |   | $ | 9.9 |   |
| Nonproductive      exploratory costs, including |                |   |            |   |   |   |   |   |   |   |   |   |
| related      lease costs                        |                | 13.1   | b               |   | 0.2 |   |   | 12.4 | b |   | 1.3 |   |
| Other                                           |                | 1.9    |            |   | 2.1 |   |   | 3.9 |   |   | 3.9 |   |
|                                            | $                   | 27.5   |            | $      | 5.3 |   | $ | 34.3 |   | $ | 15.1 |   |

| a.   | Includes      compensation costs associated with outstanding stock-based awards totaling      $9.2 million in the second quarter of 2008 and $10.0 million in the six      months ended June 30, 2008 compared with $1.1 million and $4.3 million of      compensation costs during comparable periods in 2007 (see “Stock-Based      Compensation” below and Note 8). |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| b.   | Includes      nonproductive well costs of $10.8 million related to the Mound Point East      well and $2.8 million related to the Eugene Island Block 346 B-2 well      offset by reimbursements received from our partners on previous      nonproductive wells. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                            | Second      Quarter |   | Six      Months |   |
|-------------------------------------------------|---------------------|--------|-----------------|--------|
|                                            | 2008                |   | 2007            |   | 2008 |   | 2007 |   |
| Sulphur      retiree costs                      | $                   | 285    |            | $      | 289 |   | $ | 620 |   | $ | 724 |   |
| Caretaking      costs                           |                | 225    |            |   | 250 |   |   | 441 |   |   | 434 |   |
| Accretion      expense – sulphur          |                |   |            |   |   |   |   |   |   |   |   |   |
| reclamation      obligations                    |                | 216    |            |   | 435 |   |   | 434 |   |   | 869 |   |
| Insurance                                       |                | (63    | )               |   | 23 |   |   | (58 | ) |   | 411 |   |
| General      and administrative and legal       |                | 66     |            |   | 26 |   |   | 129 |   |   | 85 |   |
| Other                                           |                | 19     |            |   | 79 |   |   | 38 |   |   | (3,752 | )a |
| Loss      (income) from discontinued operations | $                   | 748    |            | $      | 1,102 |   | $ | 1,604 |   | $ | (1,229 | ) |

|        a. |  Includes      the $4.2 million of finalized insurance recoveries associated with the      Port Sulphur property damage claims resulting from the 2005      hurricanes. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                       | Six      Months Ended |   |
|----------------------------|-----------------------|--------|
|                       | June      30,         |   |
|                       | 2008                  |   | 2007 |   |
| Continuing      operations |                  |   |   |   |   |   |
| Operating                  | $                     | 381.8  |   | $ | 38.1 |   |
| Investing                  |                  | (109.9 | ) |   | (73.6 | ) |
| Financing                  |                  | (276.6 | ) |   | 69.1 |   |

| Discontinued      operations |   |                                        |   |   |                                        |   |
|------------------------------|--------|---------------------------------------------|--------|--------|---------------------------------------------|--------|
| Operating                    |   | 0.4                                         |   |   | 0.5                                         |   |
| Investing                    |   |        - |   |   |        - |   |
| Financing                    |   |       -       |   |   |       -       |   |
|                         |   |                                        |   |   |                                        |   |
| Total cash      flow         |   |                                        |   |   |                                        |   |
| Operating                    |   | 382.2                                       |   |   | 38.6                                        |   |
| Investing                    |   | (109.9                                      | )      |   | (73.6                                       | )      |
| Financing                    |   | (276.6                                      | )      |   | 69.1                                        |   |

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|                          | December      31, |    | June      30, |   | July      2, |   |
|-------------------------------|-------------------|---------|---------------|--------|--------------|--------|
|                          | 2007              |    | 2008          |   | 2008         |   |
| 6%      notes due 2008        | $                 | 100,870 |          | $      | 43,503       |   | $ | - |   |
| 5¼%      notes due 2011  |              | 115,000 |          |   | 74,720       |   |   | 74,720 |   |
| Convertible      senior notes | $                 | 215,870 |          | $      | 118,223      |   | $ | 74,720 |   |

|                                                 | Second      Quarter |   | Six      Months |   |
|------------------------------------------------------|---------------------|--------|-----------------|--------|
|                                                 | 2008                |   | 2007            |   | 2008 |   | 2007 |   |
| General      and administrative expenses             | $                   | 9,140  |            | $      | 1,087 |   | $ | 10,121 |   | $ | 4,143 |   |
| Exploration      expenses                            |                | 9,158  |            |   | 1,063 |   |   | 10,047 |   |   | 4,277 |   |
| Main      Pass Energy Hub™      start-up costs |                | 636    |            |   | 83 |   |   | 707 |   |   | 320 |   |
| Total      stock-based compensation cost             | $                   | 18,934 |            | $      | 2,233 |   | $ | 20,875 |   | $ | 8,740 |   |

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| ·   | Level      1:  valuations consist of unadjusted quoted prices in active markets      for identical assets and liabilities and has the highest      priority; |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Level      2:  valuations rely on quoted prices in markets that are not active      or observable inputs over the full term of the asset or      liability; |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Level      3:  valuations are based on prices or third party or internal      valuation models that require inputs that are significant to the fair      value measurement and are less observable and thus have the lowest      priority. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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Item 3.  Quantitative and QualitativeDisclosures about Market Risk.

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| 2008 | $      | 2.7 |   |
|------|--------|-----|--------|
| 2009 |   | 7.3 |   |
| 2010 |   | 2.6 |   |

| 2008 | $      | 0.6 |   |
|------|--------|-----|--------|
| 2009 |   | 1.6 |   |
| 2010 |   | 0.6 |   |

Item4.   Controlsand Procedures

PART II––OTHER INFORMATION

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| Period                | (a)  Total      Number of      Shares Purchaseda | (b)  Average      Price Paid      Per Share        | (c)  Total      Number of      Shares Purchased      as Part of      Publicly Announced      Plans or      Programsb | (d)  Maximum      Number      of Shares That      May Yet Be Purchased      Under the      Plans or Programsb |
|-----------------------|------------------------------------------------------------|--------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------|
|                  |                                                       |                                                         |                                                                                                                           |                                                                                                                    |
| April      1-30, 2008 | 9,145                                                      | $         27.68 | -                                                                                                                              | 300,000                                                                                                                 |
| May      1-31, 2008   | 23,825                                                     | 27.62                                                        | -                                                                                                                              | 300,000                                                                                                                 |
| June      1-30, 2008  | 0                                                          | -                                                            | -                                                                                                                              | 300,000                                                                                                                 |
|                  |                                                       |                                                         |                                                                                                                           |                                                                                                                    |
| Total                 | 32,970                                                     | $         27.64 | -                                                                                                                              | 300,000                                                                                                                 |

| a. | Consists      of shares tendered to cover the cost of option exercises under our      applicable stock incentive plans. |
|----|-------------------------------------------------------------------------------------------------------------------------|

| b. | Our      Board of Directors has approved an open market share purchase program for      up to 2.5 million shares.  The program does not have an      expiration date.  No shares were purchased during the      three-month period ended June 30, 2008, and 0.3 million shares remain      available for purchase. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                           | Votes Cast For | Authority Withheld |
|--------------------------------|----------------|--------------------|
| 1.      Election of Directors: |           |               |
| Richard      C. Adkerson       | 50,237,916     | 575,600            |
| Robert      A. Day             | 50,411,015     | 402,501            |
| Gerald      J. Ford            | 50,190,408     | 623,108            |
| H.      Devon Graham, Jr.      | 49,483,355     | 1,330,161          |
| Suzanne      T. Mestayer       | 49,712,030     | 1,101,486          |
| James      R. Moffett          | 50,190,522     | 622,994            |
| B.      M. Rankin, Jr.         | 50,060,521     | 752,995            |

|                                                                     | For        | Against  | Abstentions |
|--------------------------------------------------------------------------|------------|---------------|-------------|
| 2.      Ratification of Ernst & Young LLP as independent    auditors | 50,672,898 | 90,290        | 50,328      |

|                                          | For   | Against   | Abstentions |
|-----------------------------------------------|------------|---------------------|-------------|
| 3.      Approval of 2008 Stock Incentive Plan | 32,730,370 | 5,744,869           | 144,524     |

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SIGNATURE

|                                 | McMoRan      Exploration Co.                        |
|--------------------------------------|-----------------------------------------------------|
|                                 |                                                |
|                                 | By:  /s/      Nancy D. Parmelee           |
|                                 | Nancy      D. Parmelee                              |
|                                 | Senior      Vice President, Chief Financial Officer |
|                                 | and      Secretary                                  |
|                                 | (authorized      signatory and Principal            |
|                                 | Financial      Officer)                             |
|                                 |                                                |
|                                 |                                                |
|                                 |                                                |
| Date:  August      7, 2008 |                                                |

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Exhibit Index

|    |                                                                                                                                                                                                                                                                                                                                                     | Filed          |                           |          |            |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------|--------------------------------|---------------|-----------------|
| Exhibit |                                                                                                                                                                                                                                                                                                                                                     | with      this | Incorporated      by Reference |
| Number  | Exhibit      Title                                                                                                                                                                                                                                                                                                                                       | Form      10-Q | Form                           | File      No. | Date      Filed |
| 2.1     | Agreement      and Plan of Merger dated as of August 1, 1998                                                                                                                                                                                                                                                                                             |           | S-4                            | 333-61171     | 10/06/1998      |
| 3.1     | Amended      and Restated Certificate of Incorporation of McMoRan                                                                                                                                                                                                                                                                                        |           | 10-K                           | 001-07791     | 03/25/1999      |
| 3.2     | Certificate      of Amendment to the Amended and Restated Certificate of Incorporation of      McMoRan                                                                                                                                                                                                                                                   |           | 10-Q                           | 001-07791     | 05/13/2003      |
| 3.3     | Amended      and Restated By-Laws of McMoRan as amended effective January 30,      2006                                                                                                                                                                                                                                                                  |           | 8-K                            | 001-07791     | 02/03/2006      |
| 4.1     | Form      of Certificate of McMoRan Common Stock                                                                                                                                                                                                                                                                                                         |           | S-4                            | 333-61171     | 10/06/1998      |
| 4.2     | Rights      Agreement dated as of November 13, 1998                                                                                                                                                                                                                                                                                                      |           | 10-K                           | 001-07791     | 03/25/1999      |
| 4.3     | Amendment      to Rights Agreement dated December 28, 1998                                                                                                                                                                                                                                                                                               |           | 10-K                           | 001-07791     | 03/25/1999      |
| 4.4     | Standstill      Agreement dated August 5, 1999 between McMoRan and Alpine Capital, L.P.,      Robert W. Bruce III, Algenpar, Inc, J. Taylor Crandall, Susan C. Bruce,      Keystone, Inc., Robert M. Bass, the Anne T. and Robert M. Bass Foundation,      Anne T. Bass and The Robert Bruce Management Company, Inc. Defined Benefit      Pension Trust |           | 10-Q                           | 001-07791     | 11/12/1999      |
| 4.5     | Indenture      dated as of July 2, 2003 by and between McMoRan and The Bank of New York,      as trustee                                                                                                                                                                                                                                                 |           | 10-Q                           | 001-07791     | 08/14/2003      |
| 4.6     | Collateral      Pledge and Security Agreement dated as of July 2, 2003 by and among      McMoRan, as pledgor, The Bank of New York, as trustee, and the Bank of New      York, as collateral agent                                                                                                                                                       |           | 10-Q                           | 001-07791     | 08/14/2003      |
| 4.7     | Purchase      Agreement dated September 30, 2004, by and among McMoRan Exploration Co.,      Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith      Incorporated, and J.P. Morgan Securities Inc                                                                                                                                        |           | 8-K                            | 001-07791     | 10/07/2004      |
| 4.8     | Indenture      dated October 6, 2004 by and among McMoRan and the Bank of New York, as      trustee                                                                                                                                                                                                                                                      |           | 8-K                            | 001-07791     | 10/07/2004      |
| 4.9     | Collateral      Pledge and Security Agreement dated October 6, 2004 by and among McMoRan,      as pledgor, The Bank of New York, as trustee and the Bank of New York, as      collateral agent                                                                                                                                                           |           | 8-K                            | 001-07791     | 10/07/2004      |
| 4.10    | Registration      Rights Agreement dated October 6, 2004 by and among McMoRan, as issuer and      Merrill Lynch, Pierce, Fenner & Smith Incorporated, J.P. Morgan      Securities Inc. and Jefferies & Company, Inc. as Initial      Purchasers                                                                                             |           | 8-K                            | 001-07791     | 10/07/2004      |
| 10.1    | Main      Pass 299 Sulphur and Salt Lease, effective May 1, 1988                                                                                                                                                                                                                                                                                         |           | 10-K                           | 001-07791     | 04/16/2002      |
| 10.2    | IMC      Global/FSC Agreement dated as of March 29, 2002 among IMC Global Inc., IMC      Global Phosphate Company, Phosphate Resource Partners Limited Partnership,      IMC Global Phosphates MP Inc., MOXY and McMoRan                                                                                                                            |           | 10-Q                           | 001-07791     | 08/14/2002      |

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TABLE OF CONTENTS

|    |               | Filed          |                           |          |            |
|---------|--------------------|----------------|--------------------------------|---------------|-----------------|
| Exhibit |               | with      this | Incorporated      by Reference |
| Number  | Exhibit      Title | Form      10-Q | Form                           | File      No. | Date      Filed |

| 10.3   | Amended      and Restated Services Agreement dated as of January 1, 2002 between      McMoRan and FM Services Company                                                                                                                                                                                                                                                                    |   | 10-Q   | 001-07791 | 08/14/2003 |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|-----------|------------|
| 10.4   | Letter      Agreement dated August 22, 2000 between Devon Energy Corporation and      Freeport Sulphur                                                                                                                                                                                                                                                                              |   | 10-Q   | 001-07791 | 10/25/2000 |
| 10.5   | Asset      Purchase Agreement dated effective December 1, 1999 between SOI Finance      Inc., Shell Offshore Inc. and MOXY                                                                                                                                                                                                                                                               |   | 10-K   | 001-07791 | 02/08/2000 |
| 10.6   | Employee      Benefits Agreement by and between Freeport-McMoRan Inc. and Freeport      Sulphur                                                                                                                                                                                                                                                                                     |   | 10-K   | 001-07791 | 04/16/2002 |
| 10.7   | Purchase      and Sales agreement dated January 25, 2002 but effective January 1, 2002      by and between MOXY and Halliburton Energy Services,    Inc                                                                                                                                                                                                                             |   | 8-K    | 001-07791 | 03/11/2002 |
| 10.8   | Purchase      and Sale Agreement dated as of March 29, 2002 by and among Freeport      Sulphur, McMoRan, MOXY and Gulf Sulphur Services Ltd.,      LLP                                                                                                                                                                                                                              |   | 10-Q   | 001-07791 | 05/10/2002 |
| 10.9   | Purchase      and Sale Agreement dated May 9, 2002 by and between MOXY and El Paso      Production Company                                                                                                                                                                                                                                                                          |   | 10-Q   | 001-07791 | 08/14/2002 |
| 10.10  | Amendment      to Purchase and Sale Agreement dated May 22, 2002 by and between MOXY and      El Paso Production Company                                                                                                                                                                                                                                                            |   | 10-Q   | 001-07791 | 08/14/2002 |
| 10.11  | Master      Agreement dated October 22, 2002 by and among Freeport-McMoRan Sulphur      LLC, K-Mc Venture LLC, K1 USA Energy Production Corporation and      McMoRan                                                                                                                                                                                                                |   | 10-K   | 001-07791 | 03/27/2003 |
| 10.12  | Purchase      and Sale Agreement dated June 20, 2007 by and between Newfield Exploration      Company as Seller and McMoRan Oil & Gas LLC as Buyer effective July 1,      2007                                                                                                                                                                                                  |   | 8-K    | 001-07791 | 06/22/2007 |
| 10.13  | Amended      and Restated Credit Agreement dated as of August 6, 2007, among McMoRan      Exploration Co., as parent, McMoRan Oil & Gas LLC, as borrower,      JPMorgan Chase Bank, N.A. Merrill Lynch Capital, a division of Merrill      Lynch Business Financial Services, Inc., as syndication agent, BNP      Paribas, as documentation agent, and the lenders party    thereto |   | 10-Q   | 001-07791 | 11/01/2007 |
| 10.14  | Credit      Agreement dated as of August 12 2007, among McMoRan Exploration Co., as      borrower, JPMorgan Chase Bank, N.A., as administrative agent, and the      lenders party thereto                                                                                                                                                                                                |   | 10-Q   | 001-07791 | 11/01/2007 |
| 10.15  | First      Amendment to Credit Agreement dated as of June 20, 2008, among McMoRan      Exploration Co., as borrower, JPMorgan Chase Bank, N.A., as administrative      agent, and the lenders party thereto                                                                                                                                                                              | X      |   |      |       |
| 10.16* | McMoRan      Adjusted Stock Award Plan, as amended and restated                                                                                                                                                                                                                                                                                                                          |   | 10-Q   | 001-07791 | 05/10/2007 |

| 10.17* | McMoRan      1998 Stock Option Plan, as amended and restated |   | 10-Q | 001-07791 | 05/10/2007 |
|--------|--------------------------------------------------------------|--------|------|-----------|------------|

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TABLE OF CONTENTS

|    |                                                                                                                                                                                                                                                       | Filed          |                           |          |            |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------|--------------------------------|---------------|-----------------|
| Exhibit |                                                                                                                                                                                                                                                       | with      this | Incorporated      by Reference |
| Number  | Exhibit      Title                                                                                                                                                                                                                                         | Form      10-Q | Form                           | File      No. | Date      Filed |
| 10.18*  | McMoRan      1998 Stock Option Plan for non-Employee Directors                                                                                                                                                                                             |           | 10-Q                           | 001-07791     | 05/10/2007      |
| 10.19*  | McMoRan      Form of Notice of Grant of Nonqualified Stock Options under the 1998 Stock      Option Plan                                                                                                                                                   |           | 10-Q                           | 001-07791     | 08/04/2005      |
| 10.20*  | McMoRan      2000 Stock Incentive Plan, as amended and restated                                                                                                                                                                                            |           | 10-Q                           | 001-07791     | 05/10/2007      |
| 10.21*  | McMoRan      Form of Notice of Grant of Nonqualified Stock Options under the 2000 Stock      Incentive Plan                                                                                                                                                |           | 10-Q                           | 001-07791     | 08/04/2005      |
| 10.22*  | McMoRan      2001 Stock Incentive Plan, as amended and restated                                                                                                                                                                                            |           | 10-Q                           | 001-07791     | 05/10/2007      |
| 10.23*  | McMoRan      2003 Stock Incentive Plan, as amended and restated                                                                                                                                                                                            |           | 10-Q                           | 001-07791     | 05/10/2007      |
| 10.24*  | McMoRan’s      Performance Incentive Awards Program as amended effective February 1,      1999                                                                                                                                                       |           | 10-K                           | 001-07791     | 03/25/1999      |
| 10.25*  | McMoRan      Form of Notice of Grant of Nonqualified Stock Options under the 2001 Stock      Incentive Plan                                                                                                                                                |           | 10-Q                           | 001-07791     | 08/04/2005      |
| 10.26*  | McMoRan      Form of Restricted Stock Unit Agreement Under the 2001 Stock Incentive      Plan                                                                                                                                                              |           | 10-Q                           | 001-07791     | 08/09/2007      |
| 10.27*  | McMoRan      Exploration Co. Executive Services Program                                                                                                                                                                                                    |           | 8-K                            | 001-07791     | 05/05/2006      |
| 10.28*  | McMoRan      Form of Notice of Grants of Nonqualified Stock Options under the 2003      Stock Incentive Plan                                                                                                                                               |           | 10-Q                           | 001-07791     | 08/04/2005      |
| 10.29*  | McMoRan      Form of Restricted Stock Unit Agreement Under the 2003 Stock Incentive      Plan                                                                                                                                                              |           | 10-Q                           | 001-07791     | 08/09/2007      |
| 10.30*  | McMoRan      2004 Director Compensation Plan, as amended and restated                                                                                                                                                                                      |           | 10-Q                           | 001-07791     | 05/10/2007      |
| 10.31*  | Form      of Amendment No. 1 to Notice of Grant of Nonqualified Stock Options under      the 2004 Director Compensation Plan                                                                                                                               |           | 8-K                            | 001-07791     | 05/05/2006      |
| 10.32*  | Agreement      for Consulting Services between Freeport-McMoRan Inc. and B. M. Rankin,      Jr. effective as of January 1, 1991)(assigned to FM Services Company as of      January 1, 1996); as amended on December 15, 1997 and on December 7,      1998 |           | 10-K                           | 001-07791     | 03/25/1999      |
| 10.33*  | Supplemental      Letter Agreement between FM Services Company and B.M. Rankin, Jr.      effective as of January 1, 2008                                                                                                                                   |           | 10-K                           | 001-07791     | 03/17/2008      |
| 10.34*  | McMoRan      Director Compensation                                                                                                                                                                                                                         | X              |                           |          |            |
| 10.35*  | McMoRan      Exploration Co. 2005 Stock Incentive Plan                                                                                                                                                                                                     |           | 10-Q                           | 001-07791     | 05/10/2007      |
| 10.36*  | Form      of Notice of Grant of Nonqualified Stock Options under the 2005 Stock      Incentive Plan                                                                                                                                                        |           | 8-K                            | 001-07791     | 05/06/2005      |
| 10.37*  | Form      of Restricted Stock Unit Agreement under the 2005 Stock Incentive      Plan                                                                                                                                                                      |           | 10-Q                           | 001-07791     | 08/09/2007      |
| 10.38*  | McMoRan      Exploration Co. Supplemental Executive Capital Accumulation      Plan                                                                                                                                                                         |           | 10-Q                           | 001-07791     | 05/08/2008      |
| 10.39*  | McMoRan      Exploration Co. Supplemental Executive Capital Accumulation Plan Amendment      One                                                                                                                                                           |           | 10-Q                           | 001-07791     | 05/08/2008      |
| 10.40*  | McMoRan      Exploration Co. 2008 Stock Incentive Plan.                                                                                                                                                                                                    |           | 8-K                            | 001-07791     | 06/11/2008      |

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TABLE OF CONTENTS

|    |                                                                                                                                                                                                      | Filed          |                           |          |            |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------|--------------------------------|---------------|-----------------|
| Exhibit |                                                                                                                                                                                                      | with      this | Incorporated      by Reference |
| Number  | Exhibit      Title                                                                                                                                                                                        | Form      10-Q | Form                           | File      No. | Date      Filed |
| 10.41*  | Form      of Notice of Grant of Nonqualified Stock Options under the 2008 Stock      Incentive Plan.                                                                                                 |           | 8-K                            | 001-07791     | 06/11/2008      |
| 10.42*  | Form      of Restricted Stock Unit Agreement under the 2008 Stock Incentive      Plan.                                                                                                                    |           | 8-K                            | 001-07791     | 06/11/2008      |
| 10.43*  | Form      of Notice of Grant of Nonqualified Stock Options and Restricted Stock      Units under the 2008 Stock Incentive Plan (for grants made to      non-management directors and advisory directors). |           | 8-K                            | 001-07791     | 06/11/2008      |
| 12.1    | Computation      of Ratio of Earnings to Fixed Charges                                                                                                                                                    |           | 10-K                           | 001-07791     | 03/17/2008      |
| 14.1    | Ethics      and Business Conduct Policy                                                                                                                                                                   |           | 10-K                           | 001-07791     | 03/15/2004      |
| 15.1    | Letter      dated August 6, 2008 from Ernst & Young LLP regarding unaudited      interim financial statements                                                                                         | X              |                           |          |            |
| 23.1    | Consent      of Ryder Scott Company, L.P.                                                                                                                                                                 | X              |                           |          |            |
| 31.1    | Certification      of Principal Executive Officer pursuant to Rule      13a–14(a)/15d-14(a)                                                                                                         | X              |                           |          |            |
| 31.2    | Certification      of Principal Financial Officer pursuant to Rule      13a–14(a)/15d-14(a)                                                                                                         | X              |                           |          |            |
| 32.1    | Certification      of Principal Executive Officer pursuant to 18 U.S.C. Section      1350                                                                                                                 | X              |                           |          |            |
| 32.2    | Certification      of Principal Financial Officer pursuant to 18 U.S.C. Section      1350                                                                                                                 | X              |                           |          |            |

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