----

|                                                                                     |
|------------------------------------------------------------------------------------------|
| **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 September 30, 2005**                   |
| **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)                           |
|                                                                                            |

|                                                                                                                               |
|------------------------------------------------------------------------------------------------------------------------------------|
| **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 |
|                                                                                                                               |   |
| Remarks                                                                                                                            | 12 |
|                                                                                                                               |   |
| Report                of Independent Registered Public Accounting                Firm                                              | 13 |
|                                                                                                                               |   |
| Management's                Discussion and Analysis of                Financial Condition and Results of                Operations |  14 |
|                                                                                                                               |   |
| Quantitative                and Qualitative Disclosures about Market                Risk                                           | 25 |
|                                                                                                                               |   |
| Controls                and Procedures                                                                                             | 25 |
|                                                                                                                               |   |
| Part                II. Other Information                                                                                          | 25 |
|                                                                                                                               |   |
| Signature                                                                                                                          | 26 |
|                                                                                                                               |   |
| Exhibit                Index                                                                                                       | E-1 |

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Table      of Contents

**McMoRan      Exploration Co.**

**Part      I. FINANCIAL INFORMATION**

**Item      1.**
**Consolidated      Financial Statements.**

**McMoRan      EXPLORATION CO.**

**CONDENSED      CONSOLIDATED BALANCE SHEETS (Unaudited**)

|                                                                           | September                30,  |    | December                31, |   |
|--------------------------------------------------------------------------------|-------------------------------|---------|-----------------------------|--------|
|                                                                           | 2005                          |    | 2004                        |   |
|                                                                           | (In                Thousands) |    |
| ASSETS                                                                         |                          |    |                        |   |   |   |
| Cash                and cash equivalents:                                      |                          |    |                        |   |   |   |
| Continuing                operations, includes restricted cash of $2.0 million |                          |    |                        |   |   |   |
| at                September 30, 2005 and $3.7 million at December 31, 2004     | $                             | 174,299 |                        | $      | 203,035 |   |
| Discontinued                operations, all restricted                         |                          | 997     |                        |   | 980 |   |
| Restricted                investments                                     |                          | 15,120  |                        |   | 15,150 |   |
| Accounts                receivable                                             |                          | 21,685  |                        |   | 27,403 |   |
| Inventories                                                                    |                          | 4,528   |                        |   | 854 |   |
| Prepaid                expenses                                                |                          | 2,265   |                        |   | 1,122 |   |
| Current                assets from discontinued operations, excluding cash     |                          | 2,550   |                        |   | 2,563 |   |
| Total                current assets                                            |                          | 221,444 |                        |   | 251,107 |   |
| Property,                plant and equipment, net                              |                          | 162,330 |                        |   | 97,262 |   |
| Sulphur                business assets                                         |                          | 312     |                        |   | 312 |   |
| Restricted                investments and cash                                 |                          | 14,042  |                        |   | 24,779 |   |
| Other                assets                                               |                          | 8,832   |                        |   | 10,460 |   |
| Total                assets                                                    | $                             | 406,960 |                        | $      | 383,920 |   |
|                                                                           |                          |    |                        |   |   |   |
| LIABILITIES                AND STOCKHOLDERS’ DEFICIT                     |                          |    |                        |   |   |   |
| Accounts                payable                                                | $                             | 49,618  |                        | $      | 33,997 |   |
| Accrued                liabilities                                             |                          | 39,530  |                        |   | 28,197 |   |
| Accrued                interest                                                |                          | 5,523   |                        |   | 5,635 |   |
| Current                portion of accrued oil and gas reclamation costs        |                          | -       |                        |   | 238 |   |
| Current                portion of accrued sulphur reclamation cost             |                          | 2,750   |                        |   | 2,550 |   |
| Current                liabilities from discontinued operations                |                          | 6,056   |                        |   | 4,601 |   |
| Total                current liabilities                                       |                          | 103,477 |                        |   | 75,218 |   |
| 6%                convertible senior notes                                     |                          | 130,000 |                        |   | 130,000 |   |
| 5¼%                convertible senior notes                               |                          | 140,000 |                        |   | 140,000 |   |
| Accrued                sulphur reclamation costs                               |                          | 12,606  |                        |   | 12,086 |   |
| Accrued                oil and gas reclamation costs                           |                          | 22,402  |                        |   | 14,191 |   |
| Contractual                postretirement obligation                           |                          | 14,802  |                        |   | 15,695 |   |
| Other                long-term liabilities                                     |                          | 15,564  |                        |   | 16,711 |   |
| Mandatorily                redeemable convertible preferred stock              |                          | 28,932  |                        |   | 29,565 |   |
| Stockholders'                deficit                                           |                          | (60,823 | )                           |   | (49,546 | ) |
| Total                liabilities and stockholders' deficit                     | $                             | 406,960 |                        | $      | 383,920 |   |
|                                                                           |                          |    |                        |   |   |   |

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Table of Contents

**McMoRan      EXPLORATION CO.**

**CONSOLIDATED      STATEMENTS OF OPERATIONS (Unaudited**)

|                                                                | Three                Months Ended                       |   | Nine                Months Ended |   |
|---------------------------------------------------------------------|---------------------------------------------------------|--------|----------------------------------|--------|
|                                                                | September                30,                            |   | September                30,     |   |
|                                                                | 2005                                                    |   | 2004                             |   | 2005 |   | 2004 |   |
| Revenues:                                                           | (In                Thousands, Except Per Share Amounts) |   |
| Oil                and gas                                          | $                                                       | 41,411 |                             | $      | 3,704 |   | $ | 83,666 |   | $ | 10,218 |   |
| Service                                                             |                                                    | 2,854  |                             |   | 3,597 |   |   | 9,218 |   |   | 10,628 |   |
| Total                revenues                                       |                                                    | 44,265 |                             |   | 7,301 |   |   | 92,884 |   |   | 20,846 |   |
| Costs                and expenses:                                  |                                                    |   |                             |   |   |   |   |   |   |   |   |   |
| Production                and delivery costs                        |                                                    | 12,498 |                             |   | 1,576 |   |   | 20,868 |   |   | 4,664 |   |
| Depreciation                and amortization                        |                                                    | 6,497  |                             |   | 1,664 |   |   | 19,426 |   |   | 4,052 |   |
| Exploration                expenses                                 |                                                    | 5,831  |                             |   | 3,230 |   |   | 41,864 |   |   | 16,662 |   |
| General                and administrative expenses                  |                                                    | 5,496  |                             |   | 3,804 |   |   | 15,132 |   |   | 10,193 |   |
| Start-up                costs for Main Pass Energy Hub™       |                                                    | 2,692  |                             |   | 2,666 |   |   | 7,577 |   |   | 8,660 |   |
| Insurance                recovery                                   |                                                    | -      |                             |   | - |   |   | (8,900 | ) |   | (1,074 | ) |
| Total                costs and expenses                             |                                                    | 33,014 |                             |   | 12,940 |   |   | 95,967 |   |   | 43,157 |   |
| Operating                income (loss)                              |                                                    | 11,251 |                             |   | (5,639 | ) |   | (3,083 | ) |   | (22,311 | ) |
| Interest                expense                                     |                                                    | (4,006 | )                                |   | (2,079 | ) |   | (11,887 | ) |   | (6,491 | ) |
| Equity                in K-Mc Venture I LLC’s (loss) income   |                                                    | -      |                             |   | (125 | ) |   | - |   |   | 318 |   |
| Other                income, net                                    |                                                    | 1,527  |                             |   | 287 |   |   | 4,547 |   |   | 664 |   |
| Income                (loss) from continuing operations             |                                                    | 8,772  |                             |   | (7,556 | ) |   | (10,423 | ) |   | (27,820 | ) |
| Loss                from discontinued operations                    |                                                    | (1,624 | )                                |   | (267 | ) |   | (3,591 | ) |   | (3,676 | ) |
| Net                income (loss)                                    |                                                    | 7,148  |                             |   | (7,823 | ) |   | (14,014 | ) |   | (31,496 | ) |
| Preferred                dividends and amortization of convertible  |                                                    |   |                             |   |   |   |   |   |   |   |   |   |
| preferred                stock issuance costs                       |                                                    | (402   | )                                |   | (410 | ) |   | (1,217 | ) |   | (1,232 | ) |
| Net                income (loss) applicable to common stock         | $                                                       | 6,746  |                             | $      | (8,233 | ) | $ | (15,231 | ) | $ | (32,728 | ) |
|                                                                |                                                    |   |                             |   |   |   |   |   |   |   |   |   |
| Basic                net income (loss) per share of common stock:   |                                                    |   |                             |   |   |   |   |   |   |   |   |   |
| Continuing                operations                                |                                                    | $0.34  |                             |   | $(0.46 | ) |   | $(0.47 | ) |   | $(1.70 | ) |
| Discontinued                operations                              |                                                    | (0.07  | )                                |   | (0.02 | ) |   | (0.15 | ) |   | (0.21 | ) |
| Net                income (loss) per share of common stock          |                                                    | $0.27  |                             |   | $(0.48 | ) |   | $(0.62 | ) |   | $(1.91 | ) |
|                                                                |                                                    |   |                             |   |   |   |   |   |   |   |   |   |
| Diluted                net income (loss) per share of common stock: |                                                    |   |                             |   |   |   |   |   |   |   |   |   |
| Continuing                operations                                |                                                    | $0.25  |                             |   | $(0.46 | ) |   | $(0.47 | ) |   | $(1.70 | ) |
| Discontinued                operations                              |                                                    | (0.04  | )                                |   | (0.02 | ) |   | (0.15 | ) |   | (0.21 | ) |
| Net                income (loss) per share of common stock          |                                                    | $0.21  |                             |   | $(0.48 | ) |   | $(0.62 | ) |   | $(1.91 | ) |
|                                                                |                                                    |   |                             |   |   |   |   |   |   |   |   |   |
| Weighted                average shares outstanding:                 |                                                    |   |                             |   |   |   |   |   |   |   |   |   |
| Basic                                                               |                                                    | 24,654 |                             |   | 17,179 |   |   | 24,553 |   |   | 17,128 |   |
| Diluted                                                             |                                                    | 43,178 |                             |   | 17,179 |   |   | 24,553 |   |   | 17,128 |   |
|                                                                |                                                    |   |                             |   |   |   |   |   |   |   |   |   |

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Table of Contents
**McMoRan      EXPLORATION CO.**

**CONSOLIDATED      STATEMENTS OF CASH FLOW (Unaudited**)

|                                                                                                                    |   | Nine                Months Ended |     |
|-------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------|----------|
|                                                                                                                    |   | September                30,     |     |
|                                                                                                                    |   | 2005                             |     | 2004 |   |
|                                                                                                                    |   | (In                Thousands)    |     |
| **Cash                flow from operating activities:**                                                                 |   |                             |     |   |   |   |   |
| Net                loss                                                                                                 |   | $                                | (14,014  | ) | $ | (31,496 | ) |
| Adjustments                to reconcile net loss to net cash provided by (used in) operating                activities: |   |                             |     |   |   |   |   |
| Loss                from discontinued operations                                                                        |   |                             | 3,591    |   |   | 3,676 |   |
| Depreciation                and amortization                                                                            |   |                             | 19,426   |   |   | 4,052 |   |
| Exploration                drilling and related expenditures                                                            |   |                             | 31,634   |   |   | 9,439 |   |
| Compensation                expense associated with stock-based awards                                                  |   |                             | 1,347    |   |   | 1,025 |   |
| Reclamation                and mine shutdown expenditures                                                               |   |                             | (4       | ) |   | (283 | ) |
| Amortization                of deferred financing costs                                                                 |   |                             | 1,669    |   |   | 1,056 |   |
| Equity                in K-Mc Venture I LLC’s income                                                              |   |                             | -        |   |   | (318 | ) |
| Other                                                                                                                   |   |                             | (503     | ) |   | 219 |   |
| (Increase)                decrease in working capital:                                                                  |   |                             |     |   |   |   |   |
| Accounts                receivable                                                                                      |   |                             | 5,760    |   |   | (3,984 | ) |
| Accounts                payable, accrued liabilities and other                                                          |   |                             | 20,634   |   |   | (538 | ) |
| Inventories                and prepaid expenses                                                                         |   |                             | (4,816   | ) |   | 611 |   |
| Net                cash provided by (used in) continuing operations                                                     |   |                             | 64,727   |   |   | (16,541 | ) |
| Net                cash used in discontinued operations                                                                 |   |                             | (2,532   | ) |   | (4,209 | ) |
| Net                cash provided by (used in) operating activities                                                      |   |                             | 62,192   |   |   | (20,750 | ) |
|                                                                                                                    |   |                             |     |   |   |   |   |
| **Cash                flow from investing activities**:                                                                 |   |                             |     |   |   |   |   |
| Exploration,                development and other capital expenditures                                                  |   |                             | (102,857 | ) |   | (25,135 | ) |
| Proceeds                from restricted investments                                                                     |   |                             | 11,475   |   |   | 7,800 |   |
| Increase                in restricted investments                                                                       |   |                             | (437     | ) |   | (157 | ) |
| Net                cash used in continuing operations                                                                   |   |                             | (91,819  | ) |   | (17,492 | ) |
| Net                cash used in discontinued operations                                                                 |   |                             | -        |   |   | (5,920 | ) |
| Net                cash used in investing activities                                                                    |   |                             | (91,819  | ) |   | (23,412 | ) |
|                                                                                                                    |   |                             |     |   |   |   |   |
| **Cash                flow from financing activities:**                                                                 |   |                             |     |   |   |   |   |
| Dividends                paid on convertible preferred stock                                                            |   |                             | (1,130   | ) |   | (1,148 | ) |
| Proceeds                from exercise of stock options and other                                                        |   |                             | 2,038    |   |   | 367 |   |
| Net                cash provided by (used in) continuing operations                                                     |   |                             | 908      |   |   | (781 | ) |
| Net                cash activity - discontinued operations                                                              |   |                             | -        |   |   | - |   |
| Net                cash provided by (used in) financing activities                                                      |   |                             | 908      |   |   | (781 | ) |
| Net                decrease in cash and cash equivalents                                                                |   |                             | (28,719  | ) |   | (44,943 | ) |
| Cash                and cash equivalents at beginning of year                                                           |   |                             | 204,015  |   |   | 101,899 |   |
| Cash                and cash equivalents at end of period                                                               |   |                             | 175,296  |   |   | 56,956 |   |
| Less                restricted cash from continuing operations                                                          |   |                             | (2,031   | ) |   | - |   |
| Less                restricted cash from discontinued operations                                                        |   |                             | (997     | ) |   | (976 | ) |
| Unrestricted                cash and cash equivalents at end of period                                                  |   | $                                | 172,268  |   | $ | 55,980 |   |

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Table of Contents

**McMoRan      EXPLORATION CO.**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**1.      **
**BASIS      OF PRESENTATION**

** **

**2.      EARNINGS PER SHARE**

|                                                                   |   | Third                Quarter |   |   | Nine                Months |   |
|------------------------------------------------------------------------|--------|------------------------------|--------|--------|----------------------------|--------|
|                                                                   |   | 2005                         |   |   | 2004                       |   |   | 2005 |   |   | 2004 |   |
| In-the-money                stock options a                ,b          |   |                         | -      | c      |                       |   | 745 |   |   |   | 1,454 |   |   |   | 841 |   |
| Stock                warrants a,d                                      |   |                         | -      | c      |                       |   | 1,592 |   |   |   | 1,805 |   |   |   | 1,645 |   |
| 5%                mandatorily redeemable convertible preferred stock e |   |                         | -      | c      |                       |   | 6,365 |   |   |   | 1,196 |   |   |   | 6,365 |   |
| 6%                convertible senior notes f                           |   |                         | -      | c      |                       |   | 9,123 |   |   |   | 9,123 |   |   |   | 9,123 |   |
| 5¼%                convertible senior notes g                     |   |                         | 8,446  |   |                       |   | N/A |   |   |   | 8,446 |   |   |   | N/A |   |

| a.   | McMoRan                uses the treasury stock method to determine the amount of in-the-money                stock options and stock warrants to include in its diluted earnings                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.   | For                the third-quarter 2005, McMoRan had net income from continuing operations                which resulted in the assumed exercise or conversion of these securities                in McMoRan’s diluted net income per share calculation (see table below for                a reconciliation of McMcRan’s third-quarter 2005 diluted earnings per                share calculation to its reported basic net income per                share). |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| d.   | Includes                stock warrants issued to K1 USA Energy Production Corporation in                December                2002 (1.74 million shares) and September 2003 (0.76 million shares).                The                warrants are exercisable for McMoRan common stock at any time over                their                respective five-year terms at an exercise price of $5.25 per share.                See                Note 4 of McMoRan’s 2004 Form 10-K for additional information regarding                the warrants. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| e.   | At                the election of the holder, and before the shares mature on June                30, 2012,                each outstanding share of 5% mandatorily redeemable convertible preferred                stock (1.2 million shares outstanding as of September 30, 2005) is                convertible into 5.1975 shares of McMoRan common stock. For |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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Table of Contents
|    | additional                information regarding McMoRan’s 5% convertible preferred stock see Note 5                of McMoRan’s 2004 Form 10-K. |
|--------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|

| f.   | The                notes, issued in July 2003, are 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. Additional                information regarding McMoRan’s 6% convertible senior notes is disclosed                in Note 5 of its 2004 Form 10-K. Net interest expense on the                6%                convertible senior notes totaled $2.1 million during the third quarters                of                2005 and 2004 and $6.3 million for the nine-month periods ended September                30, 2005 and 2004. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| g.   | The                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.                Additional information regarding McMoRan’s 5¼% convertible senior notes is                disclosed in Note 5 of its 2004 Form 10-K. Net interest on                the 5¼%                convertible senior notes totaled $2.0 million and $6.1 million for                the                third quarter and nine months ended September 30, 2005,                respectively. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                              |   | Third                Quarter |   |   | Nine                Months |   |
|---------------------------------------------------|--------|------------------------------|--------|--------|----------------------------|--------|
|                                              |   | 2005                         |   |   | 2004                       |   |   | 2005 |   |   | 2004 |   |
| Outstanding                options (in thousands) |   |                         | 445    |   |                       |   | 2,515 |   |   |   | 420 |   |   |   | 2,513 |   |
| Average                exercise price             |   | $                            | 21.54  |   |                       | $      | 17.99 |   |   | $ | 21.71 |   |   | $ | 17.99 |   |

| Basic                net income from continuing operations                                                                                    |   | $      | 8,370                 |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|-----------------------|--------|
| Add:                Preferred dividends from assumed conversion of 5% mandatorily redeemable                convertible preferred stock       |   |   | 402                   |   |
| Add:                Net interest from assumed conversion of 6% convertible senior                notes                                        |   |   | 2,128                 |   |
| Diluted                income (loss) from continuing operations                                                                               |   |   | 10,900                |   |
| Loss                from discontinued sulphur operations                                                                                      |   |   | (1,624                | )      |
| Diluted                net income (loss) applicable to common stock                                                                           |   | $      | 9,276                 |   |
|                                                                                                                                          |   |   |                  |   |
| Weighted                average common shares outstanding for purpose of calculating basic                net                income per share |   |   | 24,659                |   |
| Assumed                exercise of dilutive stock options                                                                                     |   |   | 1,382                 |   |
| Assumed                exercise of stock warrants                                                                                             |   |   | 1,800                 |   |
| Assumed                conversion of 5% mandatorily redeemable convertible preferred                stock                                     |   |   | 6,214                 |   |
| Assumed                conversion of 6% convertible senior notes                                                                              |   |   | 9,123                 |   |
| Weighted                average common shares outstandingfor                purposes of calculating diluted net income per share              |   |   | 43,178                |   |
|                                                                                                                                          |   |   |                  |   |
| Diluted                net income from continuing operations                                                                                  |   |   | $0.25                 |   |
| Diluted                net loss from discontinued sulphur operations                                                                          |   |   |   (0.04     | )      |
| Diluted                net income per share                                                                                                   |   |   | $                0.21 |   |

*Stock-Based      Compensation Plans.*
** **

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Table of Contents
|                                                                                                                       |   | Three                Months Ended |   | Nine                Months Ended |   |
|----------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------|--------|----------------------------------|--------|
|                                                                                                                       |   | September                30,      |   | September                30,     |   |
|                                                                                                                       |   | 2005                              |   | 2004                             |   | 2005 |   | 2004 |   |
| Net                income (loss) applicable to common stock, as                                                            |   |                              |   |                             |   |   |   |   |   |   |   |   |   |
| reported                                                                                                                   |   | $                                 | 6,746  |                             | $      | (8,233 | ) | $ | (15,231 | ) | $ | (32,728 | ) |
| Add:                Stock-based compensation expense                                                                       |   |                              |   |                             |   |   |   |   |   |   |   |   |   |
| included                in reported net income (loss) for restricted stock units and employee                stock options |   |                              | 261    |                             |   | 54 |   |   | 1,121 |   |   | 618 |   |
| Deduct:                Total stock-based compensation                                                                      |   |                              |   |                             |   |   |   |   |   |   |   |   |   |
| expense                determined under fair value-                                                                        |   |                              |   |                             |   |   |   |   |   |   |   |   |   |
| based                method for all awards                                                                                 |   |                              | (1,461 | )                                |   | (1,050 | ) |   | (9,994 | ) |   | (7,101 | ) |
| Pro                forma net income (loss) applicable to                                                                   |   |                              |   |                             |   |   |   |   |   |   |   |   |   |
| common                stock                                                                                                |   | $                                 | 5,546  |                             | $      | (9,229 | ) | $ | (24,104 | ) | $ | (39,211 | ) |
|                                                                                                                       |   |                              |   |                             |   |   |   |   |   |   |   |   |   |
| Net                income (loss) per share:                                                                                |   |                              |   |                             |   |   |   |   |   |   |   |   |   |
| Basic                - as reported                                                                                         |   | $                                 | 0.27   |                             | $      | (0.48 | ) | $ | (0.62 | ) | $ | (1.91 | ) |
| Basic                - pro forma                                                                                           |   | $                                 | 0.22   |                             | $      | (0.54 | ) | $ | (0.98 | ) | $ | (2.29 | ) |
|                                                                                                                       |   |                              |   |                             |   |   |   |   |   |   |   |   |   |
| Diluted                - as reported                                                                                       |   | $                                 | 0.21   |                             | $      | (0.48 | ) | $ | (0.62 | ) | $ | (1.91 | ) |
| Diluted                - pro forma                                                                                         |   | $                                 | 0.17   | a                                | $      | (0.54 | ) | $ | (0.98 | ) | $ | (2.29 | ) |

|                                               |   | Third                Quarter |   | Nine                Months |   |
|----------------------------------------------------|--------|------------------------------|--------|----------------------------|--------|
|                                               |   | 2005                         |   | 2004                       |   | 2005 |   | 2004 |   |
| Fair                value of stock options         |   | $                            | N/A    | a                          | $      | 8.56 |   | $ | 11.45 |   | $ | 11.03 |   |
| Risk                free interest rate             |   |                         | N/A    |                       |   | 3.8 | % |   | 4.3 | % |   | 3.9 | % |
| Expected                volatility rate            |   |                         | N/A    |                       |   | 65.8 | % |   | 61.2 | % |   | 64.8 | % |
| Expected                life of options (in years) |   |                         | N/A    |                       |   | 7 |   |   | 7 |   |   | 7 |   |
| Assumed                annual dividend             |   |                         | -      |                       |   | - |   |   | - |   |   | - |   |

**3.      OTHER MATTERS**

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**Blueberry      Hill**

**Minuteman      **
** **

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*Accounting      of Asset Retirement Obligations*

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** **

|                                                      |   |   | Third                Quarter |   |   | Nine                Months |   |
|-----------------------------------------------------------|--------|--------|------------------------------|--------|--------|----------------------------|--------|
|                                                      |   |   | 2005                         |   |   | 2004                       |   |   | 2005 |   |   | 2004 |   |
| Interest                cost                              |   | $      | 60                           |   | $      | 100                        |   | $ | 143 |   | $ | 288 |   |
| Service                cost                               |   |   | -                            |   |   | -                          |   |   | - |   |   | - |   |
| Return                on plan assets                      |   |   | (30                          | )      |   | (164                       | )      |   | (115 | ) |   | (222 | ) |
| Net                periodic cost                (benefit) |   | $      | 30                           |   | $      | (64                        | )      | $ | 28 |   | $ | 63 |   |

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**4.        NEW ACCOUNTING STANDARD**

**5.        RATIO OF EARNINGS TO FIXED CHARGES **

Remarks

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REPORT        OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING        FIRM

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Item      2. Management's      Discussion and Analysis of Financial Condition and Results of      Operations.

**OVERVIEW**

*In      management’s discussion and analysis “we,”“us,” and “our” refer to McMoRan      Exploration Co. and its wholly owned consolidated subsidiaries, McMoRan Oil      & Gas LLC (MOXY) and Freeport-McMoRan Energy LLC (Freeport Energy). You      should read the following discussions in conjunction with our consolidated      financial statements, the related discussion and analysis of financial condition      and results of operations and our discussion of “Business and Properties” in our      Form 10-K for the year ended December 31, 2004 (2004 Form 10-K), filed with      the      Securities and Exchange Commission. The results of operations reported and      summarized below are not necessarily indicative of future operating results.      Unless otherwise specified, all references to Notes refers to Notes to      Consolidated Financial Statements included elsewhere in this Form 10-Q.*

**OIL      & GAS ACTIVITIES**

|                                                                                            |  **Working****Interest** | **Net****Revenue****Interest** |  **Prospect                Acreage****a** | **Water                Depth** | **Proposed                Total****Depth****b** |  **Current                Depth****c** | **Spud                Date****d**** ** |
|-------------------------------------------------------------------------------------------------|-------------------------------|--------------------------------|------------------------------------------------|--------------------------------|-------------------------------------------------|---------------------------------------------|---------------------------------------------|
| **In                Progress Wells:**                                                           |                          |                           |                                           |                           |                                            |                                        |                                        |
| South                Marsh Island Block 224“**JB                Mountain Deep**”e,f | 27.5%                         | 19.4%                          | 2,200                                          | 10'                            | 23,000'                                         |  20,500’                         | July                14, 2005                |
| Louisiana                State Lease 18090“**Long                Point**”f,g        | 37.5%                         | 26.8%                          |  5,000                                    | 8’                       | 19,000’                                   |  19,000’                         | July                21, 2005                |
| Louisiana                State Lease 18055“**Cane                Ridge**”f          | 37.5%                         | 27.5%                          | 1,000                                          | N/Ah                           | 16,500’                                   |  10,000’                         | July                29, 2005                |
| South                Marsh Island Block 230“**Elizabeth**”e                         | 15.0%                         | 11.3%                          | 10,000                                         | 18’                      | 20,000’                                   | 11,400                                      | September                16, 2005           |
| West                Cameron Block 95“**Cabin                Creek**”e,f             | 37.5%                         | 31.0%                          | 5,000                                          | 40’                      | 19,000’                                   | 4,500                                       | October                15, 2005             |

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|                                                                                                          |  **Working****Interest** | **Net****Revenue****Interest** |  **Prospect                Acreage****a** | **Water                Depth** | **Proposed                Total****Depth****b** |  **Current                Depth****c** | **Spud                Date****d**** ** |
|---------------------------------------------------------------------------------------------------------------|-------------------------------|--------------------------------|------------------------------------------------|--------------------------------|-------------------------------------------------|---------------------------------------------|---------------------------------------------|
| **Development                Wells**:                                                                         |                          |                           |                                           |                           |                                            |                                        |                                        |
| Vermilion                Blocks 16/17“**King                Kong**”                No. 2 f,g | 40.0%                         | 29.2%                          | 1,850                                          | 12’                      | 13,680’                                   | 13,680’                               | August                12, 2005              |
| South                Marsh Island Block 225“**Hurricane**”                No. 2 f                 | 27.5%                         | 19.4%                          | 7,700                                          | 10’                      | 16,000’                                   | 9,300’                                | August                21, 2005              |
| **Near-Term                Exploration Wells:**                                                               |                          |                           |                                           |                           |                                            |                                        |                                        |
| Louisiana                State Lease 18350“**Point                Chevreuil**”                    | 25.0%                         | 17.5%                          | 1,700                                          | <10’                  | 17,000’                                   | N/A                                         | Fourth                Quarter2005           |
| Onshore                Vermilion Parish “**Liberty                Canal**”f                       | 37.5%                         | 27.7%                          | 1,420                                          | N/Ah                           | 16,000’                                   | N/A                                         | Fourth                Quarter2005           |

| a.   | Gross                acres encompassing prospect to which we retain exploration                rights. |
|----------------|--------------------------------------------------------------------------------------------------------|

| b.   | Planned                target measured depth, which is subject to                change. |
|----------------|------------------------------------------------------------------------------------------|

| c.   | Approximate                total depth of well on November 1,                2005. |
|----------------|------------------------------------------------------------------------------------|

| d.   | The                timing of fourth quarter 2005 wells is subject to change. |
|----------------|------------------------------------------------------------------------------|

| e.   | Depending                upon applicability of Deep Gas Royalty Relief eligibility criteria,                the                lease on which these wells are located could be eligible for royalty                relief up to 25 Bcf of gas production under current Minerals Management                Service (MMS) guidelines. Our net revenue interests would increase                during                the royalty relief period for eligible                leases. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| f.   | Wells                in which we are the operator or expect to be the                operator. |
|----------------|------------------------------------------------------------------------------------------------|

| g.   | Well                is currently being completed. |
|----------------|---------------------------------------------------|

| h.   | Prospect                located onshore Louisiana. |
|----------------|----------------------------------------------------|

**JB      Mountain Deep**

**Long      Point**

**Cane      Ridge**

**Elizabeth**

**Cabin      Creek**

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**Point      Chevreuil**
**Liberty      Canal**

**King      Kong No. 2**

**Hurricane      No. 2**

**West      Cameron Block 43 No. 4 **

**Dawson      Deep**

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**Blueberry      Hill**

**Raptor**

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**MAIN      PASS ENERGY HUB**
**TM**

**      PROJECT**

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**RESULTS      OF OPERATIONS**

** **

|                                                     | Three                Months Ended |   | Nine                Months Ended |   |
|----------------------------------------------------------|-----------------------------------|--------|----------------------------------|--------|
|                                                     | September                30,      |   | September                30,     |   |
|                                                     | 2005                              |   | 2004                             |   | 2005 |   | 2004 |   |
| Sales                volumes:                            |                              |   |                             |   |   |   |   |   |
| Gas                (thousand cubic feet, or Mcf)         | 2,011,900                         |   | 499,600                          |   | 6,187,100 |   | 1,247,600 |   |
| Oil,                excluding Main Pass 299 (barrels)    | 89,400                            |   | 13,700                           |   | 186,200 |   | 51,200 |   |
| Oil                from Main Pass 299 (barrels) a        | 235,000                           |   | -                                |   | 335,600 |   | - |   |
| Plant                products (equivalent barrels) b     | 42,500                            |   | 5,400                            |   | 78,000 |   | 17,200 |   |
| Average                realizations:                     |                              |   |                             |   |   |   |   |   |
| Gas                (per Mcf)                             | $                10.31            |   | $                5.65            |   | $                8.26 |   | $                5.98 |   |
| Oil,                excluding Main Pass 299 (per barrel) | 61.18                             |   | 43.25                            |   | 56.16 |   | 37.96 |   |
| Oil                from Main Pass 299 (per barrel)       | 55.64                             |   | -                                |   | 52.90 |   | - |   |

| a. | Main                Pass 299 resumed production on May 6, 2005 following successful                modification of existing storage tanks to accommodate transportation                of                oil from the field by barge. In late August 2005, Main Pass was shut-in                following Hurricane Katrina; however production is expected to resume                in                fourth quarter of 2005. At September 30, 2005, we had approximately                30,000                barrels of oil inventory attributable to the Main Pass operations.                  |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| b.                 | We                received approximately $1.9                million and $3.3 million of revenues associated with plant products                (ethane, propane, butane, etc.) during the third quarter of 2005                and nine                months ending September 30, 2005, respectively, compared with $0.2                million                and $0.5 million of plant product revenues in the comparable periods                last                year. The increase in plant product revenue in 2005 reflects commencement                of production from our recent discoveries, specifically production                from                the Hurricane and Deep Tern fields. |
|------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Oil      and Gas Operations**

|                                                        | ThirdQuarter |   |   | NineMonths |   |
|-------------------------------------------------------------|--------------|--------|--------|------------|--------|
| Oil                and gas revenues - prior year period     | $            | 3,704  |   | $          | 10,218 |   |
| Increase                in:                                 |         |   |   |       |   |   |
| Price                realizations:                          |         |   |   |       |   |   |
| Gas                                                         |         | 9,375  |   |       | 14,107 |   |
| Oil,                excluding Main Pass 299                 |         | 1,603  |   |       | 3,389  |   |
| Sales                volumes:                               |         |   |   |       |   |   |
| Gas                                                         |         | 8,544  |   |       | 29,538 |   |
| Oil,                excluding Main Pass 299                 |         | 3,274  |   |       | 5,125  |   |
| Revenue                from oil production at Main Pass 299 |         | 13,077 |   |       | 17,757 |   |
| Plant                products revenues                      |         | 1,699  |   |       | 2,817  |   |
| Other                                                       |         | 135    |   |       | 715    |   |
| Oil                and gas revenues - current year period   | $            | 41,411 |   | $          | 83,666 |   |

**Hurricane      Upthrown**
**Deep      Tern C-1**
**Deep      Tern C-2**
**Minuteman      **

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|                                                      | Third                Quarter |   | Nine                Months |   |
|-----------------------------------------------------------|------------------------------|--------|----------------------------|--------|
|                                                      | 2005                         |   | 2004                       |   | 2005 |   | 2004 |   |
| Geological                and geophysical                 | $                            | 2.5    |                       | $      | 0.7 |   | $ | 5.3 |   | $ | 4.2 |   |
| Nonproductive                exploratory costs, including |                         |   |                       |   |   |   |   |   |   |   |   |   |
| related                lease costs                        |                         | 2.7    | a                          |   | 1.9 | b |   | 31.6 | a,c |   | 9.5 | b,d |
| Other                                                     |                         | 0.7    |                       |   | 0.6 |   |   | 5.0 | e |   | 3.0 |   |
|                                                      | $                            | 5.9    |                       | $      | 3.2 |   | $ | 41.9 |   | $ | 16.7 |   |

| a.   | Includes                $1.4 million of nonproductive exploratory drilling and related costs                associated with the “Delmonico” well at Louisiana State Lease 1706                incurred in July 2005 and $1.1 million of drilling costs associated                with                the “Little Bay” well at Louisiana State Lease                5097. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| b.   | Includes                nonproductive exploratory drilling and related costs for the Poblano                well                at East Cameron Block 137 incurred as of September 30, 2004 totaling                $1.5                million. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| c.   | Includes                nonproductive exploratory well costs associated with the “Korn” well at                South Timbalier Blocks 97/98 ($6.9 million), the “Little Bay” well ($12.1                million), the “Delmonico” well ($8.9 million), the “Caracara” well at                Vermilion Blocks 227/228 ($1.3 million), the “King of the Hill” well at                High Island Block 131 ($0.3 million), the “Gandalf ” well at Mustang                Island Block 829 ($0.2 million) and the deeper zones at both the                “Hurricane Upthrown” well at South Marsh Island Block 217 ($0.4 million)                and the West Cameron Block 43 No. 3 exploratory well ($0.4 million).                Amount also includes the write-off of approximately $1.5 million                of                leasehold costs. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| d.   | Reflects                $7.2 million of nonproductive exploratory drilling and related costs                for                the Lombardi Deep well ($0.4 million charged to expense during the                third                quarter of 2004) and $0.7 million for the costs incurred on the Hurricane                well at South Marsh Island Block 217 during the first quarter of                2004. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| e.   | Includes                insurance costs associated with our increasing exploration drilling                activities. Increase over 2004 periods also includes higher delay                rental                payments to maintain portions of our acreage                position. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Other      Financial Results**

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**CAPITAL      RESOURCES AND LIQUIDITY**

|                                 | Nine                Months EndedSeptember                30 |   |
|--------------------------------------|-------------------------------------------------------------|--------|
|                                 | 2005                                                        |   |   | 2004 |   |
| Continuing                operations |                                                        |   |   |   |   |   |   |
| Operating                            | $                                                           | 64.7   |   |   | $ | (16.5 | ) |
| Investing                            |                                                        | (91.8  | ) |   |   | (17.5 | ) |
| Financing                            |                                                        | 0.9    |   |   |   | (0.8 | ) |

| Discontinued                operations |   |   |   |   |   |   |   |
|----------------------------------------|--------|--------|--------|--------|--------|--------|--------|
| Operating                              |   | (2.5   | )      |   |   | (4.2   | )      |
| Investing                              |   | -      |   |   |   | (5.9   | )      |
| Financing                              |   | -      |   |   |   | -      |   |

| Total                cash flow |   |   |   |   |   |   |   |
|--------------------------------|--------|--------|--------|--------|--------|--------|--------|
| Operating                      |   | 62.2   |   |   |   | (20.7  | )      |
| Investing                      |   | (91.8  | )      |   |   | (23.4  | )      |
| Financing                      |   | 0.9    |   |   |   | (0.8   | )      |

**Nine-Month      2005 Cash Flows Compared with Nine-Month 2004**

** **

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**DISCONTINUED      OPERATIONS**

|                                             | Third                Quarter |   | Nine                Months |   |
|--------------------------------------------------|------------------------------|--------|----------------------------|--------|
|                                             | 2005                         |   | 2004                       |   | 2005 |   | 2004 |   |
| Sulphur                retiree costs a           | $                            | 299    |                       | $      | 469 |   | $ | 701 |   | $ | 1,767 |   |
| Legal                expenses b                  |                         | (32    | )                          |   | 346 |   |   | 354 |   |   | 1,495 |   |
| Caretaking                costs                  |                         | 479    |                       |   | 363 |   |   | 922 |   |   | 787 |   |
| Accretion                expense - sulphur       |                         |   |                       |   |   |   |   |   |   |   |   |   |
| reclamation                obligations           |                         | 240    |                       |   | 216 |   |   | 720 |   |   | 650 |   |
| Insurance                                        |                         | 345    |                       |   | (706 | )c |   | 529 |   |   | (454 | )c |
| General                and administrative        |                         | 66     |                       |   | 74 |   |   | 143 |   |   | 183 |   |
| Other                                            |                         | 227    | d                          |   | (495 | )e |   | 222 |   |   | (752 | )e |
| Loss                from discontinued operations | $                            | 1,624  |                       | $      | 267 |   | $ | 3,591 |   | $ | 3,676 |   |

| a.   | The                decrease during 2005 reflect lower expected costs associated with                an                obligation to reimburse a third party for a portion of the postretirement                benefit costs relating to certain retired sulphur employees. The                decrease                primarily resulted from certain plan changes made by the plan sponsor                that                decreased the number of former employees covered by the obligation                and the                amount of future benefits to be                paid. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| b.   | The                decreases during 2005 reflect the July 2004 settlement of certain                litigation involving the reclamation of certain sulphur structures                at Main                Pass. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| c.   | During                the third quarter of 2004, we reduced our estimated uninsured workers                compensation and general liability claims following completion of                an                analysis of such matters, resulting in a $0.8 million decrease in                our                accrued liability. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| d.   | Primarily                reflects estimated repairs and related costs associated with our                inactive                Port Sulphur, Louisiana facilities following Hurricane Katrina. We                are                assessing various alternatives for the ultimate closure of these                facilities, which may result in changes in the related timing                and/or                estimated costs. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| e.   | Includes                $0.3 million gain on the sale of materials and supply inventory previously                charged to expense in June 2000 and a $0.3 million gain on the settlement                of an environmental liability partially offset by certain costs incurred                to evaluate and remediate other environmental                liabilities. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**CAUTIONARY      STATEMENT**

* *

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Item      3.Quantitative      and Qualitative Disclosures about Market Risk.

Item      4.Controls      and Procedures.

PART      II--OTHER INFORMATION

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SIGNATURE

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**McMoRan      Exploration Co.**

**Exhibit      Index**

**Exhibit      Number**

| 2.1    | Agreement                and Plan of Mergers dated as of August 1, 1998. (Incorporated by                reference                to Annex A to McMoRan’s Registration Statement on Form S-4 (Registration                No. 333-61171) filed with the SEC on October 6, 1998 (the McMoRan                S-4)).                                                                                                                                                                                                                             |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 3.1    | Amended                and Restated Certificate of Incorporation of McMoRan. (Incorporated                by                reference to Exhibit 3.1 to McMoRan’s 1998 Annual Report on Form 10-K (the                McMoRan 1998 Form 10-K)).                                                                                                                                                                                                                                                                                               |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 3.2    | Certificate                of Amendment to the Amended and Restated Certificate of Incorporation                of                McMoRan. (Incorporated by reference to Exhibit 3.2 of McMoRan’s                First-Quarter 2003 Form 10-Q).                                                                                                                                                                                                                                                                                               |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 3.3    | Amended                and Restated By-laws of McMoRan as amended effective February 2,                2004.                (Incorporated by reference to Exhibit 3.3 to McMoRan’s 2003 Annual Report                on Form 10-K (the McMoRan 2003 Form 10-K)).                                                                                                                                                                                                                                                                              |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 4.1    | Form                of Certificate of McMoRan Common Stock (Incorporated by reference                to                Exhibit 4.1 of the McMoRan S-4).                                                                                                                                                                                                                                                                                                                                                                                             |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 4.2    | Rights                Agreement dated as of November 13, 1998. (Incorporated by reference                to                Exhibit 4.2 to McMoRan 1998 Form 10-K).                                                                                                                                                                                                                                                                                                                                                                                  |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 4.3    | Amendment                to Rights Agreement dated December 28, 1998. (Incorporated by reference                to                Exhibit 4.3 to McMoRan 1998 Form 10-K).                                                                                                                                                                                                                                                                                                                                                                           |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 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. (Incorporated by reference to Exhibit 4.4 to McMoRan’s                Third Quarter 1999 Form 10-Q). |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 4.5    | Form                of Certificate of McMoRan 5% Convertible Preferred Stock (McMoRan                Preferred Stock). (Incorporated by reference to Exhibit 4.5 to McMoRan’s                Second Quarter 2002 Form 10-Q).                                                                                                                                                                                                                                                                                                                  |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 4.6    | Certificate                of Designations of McMoRan Preferred Stock. (Incorporated by reference                to                Exhibit 4.6 to McMoRan’s Third-Quarter 2002 Form 10-Q).                                                                                                                                                                                                                                                                                                                                                    |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 4.7    | Warrant                to Purchase Shares of Common Stock of McMoRan Exploration Co. dated                December 16, 2002. (Incorporated by reference to Exhibit 4.7 to McMoRan’s                2002 Form 10-K).                                                                                                                                                                                                                                                                                                                           |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 4.8    | Warrant                to Purchase Shares of Common Stock of McMoRan Exploration Co. dated                September 30, 2003. (Incorporated by reference to Exhibit 4.8 to                McMoRan’s                2003 Form 10-K),                                                                                                                                                                                                                                                                                                           |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 4.9    | Registration                Rights Agreement dated December 16, 2002 between McMoRan Exploration                Co.                and K1 USA Energy Production Corporation. (Incorporated by reference                to                Exhibit 4.8 to McMoRan’s 2002 Form 10-K).                                                                                                                                                                                                                                                            |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 4.10   | Indenture                dated as of July 2, 2003 by and between McMoRan and The Bank of New                York,                as trustee. (Incorporated by reference to Exhibit 4.9 to McMoRan’s                Second-Quarter 2003 Form 10-Q).                                                                                                                                                                                                                                                                                            |

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| 4.11   | 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. (Incorporated by reference to Exhibit                4.11 to                McMoRan’s Second-Quarter 2003 Form 10-Q).                                                                                           |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 4.12   | Indenture                dated October 6, 2004 by and among McMoRan and the Bank of New York,                as                trustee. (Incorporated by reference to Exhibit 99.3 to McMoRan’s Current                Report on Form 8-K dated October 6, 2004 (filed October 7,                2004).                                                                                                                                                          |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 4.13   | 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. (Incorporated by reference to Exhibit 99.4 to McMoRan’s                Current Report on Form 8-K dated October 6, 2004 (filed October 7,                2004).                                      |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 4.14   | 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.                (Incorporated by reference to Exhibit 99.5 to McMoRan’s Current Report on                Form 8-K dated October 6, 2004 (filed October 7, 2004). |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 10.1   | Main                Pass 299 Sulphur and Salt Lease, effective May 1, 1988. (Incorporated                by                reference to Exhibit 10.1 to McMoRan’s 2001 Annual Report on Form 10-K                (the McMoRan 2001 Form 10-K)).                                                                                                                                                                                                                  |

| 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. (Incorporated by                reference to Exhibit 10.10 to McMoRan’s Second Quarter 2002 Form                10-Q). |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                                                                |
| 10.3   | Amended                and Restated Services Agreement dated as of January 1, 2002 between                McMoRan and FM Services Company. (Incorporated by reference to Exhibit                10.3 to McMoRan’s Second-Quarter 2003 Form 10-Q).                                                                                                                                             |
|   |                                                                                                                                                                                                                                                                                                                                                                                                |
| 10.4   | Letter                Agreement dated August 22, 2000 between Devon Energy Corporation                and                Freeport Sulphur. (Incorporated by reference to Exhibit 10.36 to                McMoRan’s                Third-Quarter 2000 Form 10-Q).                                                                                                                              |

| 10.5   | Asset                Purchase Agreement dated effective December 1, 1999 between SOI Finance                Inc., Shell Offshore Inc. and MOXY. (Incorporated by reference to                Exhibit                10.33 in the McMoRan 1999 Form 10-K).                                                                                                |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                     |
| 10.6   | Employee                Benefits Agreement by and between Freeport-McMoRan Inc. and Freeport                Sulphur (Incorporated by reference to Exhibit 10.29 to McMoRan’s 2001 Form                10-K).                                                                                                                                       |
|   |                                                                                                                                                                                                                                                                                                                                                     |
| 10.7   | Purchase                and Sales agreement dated January 25, 2002 but effective January                1, 2002                by and between MOXY and Halliburton Energy Services, Inc. (Incorporated                by                reference to Exhibit 10.1 to McMoRan’s Current Report on Form 8-K dated                February 22, 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. (Incorporated                by reference to Exhibit 10.37 to McMoRan’s First-Quarter 2002 Form 10-Q.)                      |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                     |
| 10.9   | Purchase                and Sale Agreement dated May 9, 2002 by and between MOXY and El Paso                Production Company. (Incorporated by reference to Exhibit 10.28 to                McMoRan’s Second Quarter 2002 Form 10-Q).                                                            |
|   |                                                                                                                                                                                                                                                                                                     |
| 10.10  | Amendment                to Purchase and Sale Agreement dated May 22, 2002 by and between                MOXY and                El Paso Production Company. (Incorporated by reference to Exhibit                10.29 to                McMoRan’s Second Quarter 2002 Form                10-Q). |

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Table of Contents
| 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                Exploration Co. (Incorporated by reference to Exhibit 10.18 to McMoRan’s                2002 Form 10-K). |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                              |
|   | Executive                and Director Compensation Plans and Arrangements (Exhibits 10.12                through                10.32).                                                                                                                                                                           |
|   |                                                                                                                                                                                                                                                                                                              |
| 10.12  | McMoRan                Adjusted Stock Award Plan, as amended. (Incorporated by reference                to                Exhibit 10.15 to McMoRan’s 2003 Form 10-K)                                                                                                                                        |
|   |                                                                                                                                                                                                                                                                                                              |
| 10.13  | McMoRan                1998 Stock Option Plan. (Incorporated by reference to Exhibit 10.13                to                McMoRan’s Second-Quarter 2005 Form 10-Q).                                                                                                                                       |
|   |                                                                                                                                                                                                                                                                                                              |
| 10.14  | McMoRan                1998 Stock Option Plan for Non-Employee Directors. (Incorporated                by                reference to Exhibit 10.14 to McMoRan’s Second-Quarter 2005 Form                10-Q).                                                                                             |
|   |                                                                                                                                                                                                                                                                                                              |
| 10.15  | McMoRan                Form of Notice of Grant of Nonqualified Stock Options and Limited                Rights                under the 1998 Stock Option Plan. (Incorporated by reference to Exhibit                10.15 to McMoRan’s Second-Quarter 2005 Form 10-Q).                                     |
|   |                                                                                                                                                                                                                                                                                                              |
| 10.16  | McMoRan                2000 Stock Incentive Plan. (Incorporated by reference to Exhibit                10.16 to                McMoRan’s Second-Quarter 2005 Form 10-Q).                                                                                                                                    |
|   |                                                                                                                                                                                                                                                                                                              |
| 10.17  | McMoRan                Form of Notice of Grant of Nonqualified Stock Options and Limited                Rights                under the 2000 Stock Incentive Plan. (Incorporated by reference to                Exhibit                10.17 to McMoRan’s Second-Quarter 2005 Form 10-Q).                   |
|   |                                                                                                                                                                                                                                                                                                              |
| 10.18  | McMoRan                2001 Stock Incentive Plan. (Incorporated by reference to Exhibit                10.18 to                McMoRan’s Second-Quarter 2005 Form 10-Q).                                                                                                                                    |
|   |                                                                                                                                                                                                                                                                                                              |
| 10.19  | McMoRan                2003 Stock Incentive Plan. (Incorporated by reference to Exhibit                10.19 to                McMoRan’s Second-Quarter 2005 Form 10-Q).                                                                                                                                    |
|   |                                                                                                                                                                                                                                                                                                              |
| 10.20  | McMoRan’s                Performance Incentive Awards Program as amended effective February                1,                1999. (Incorporated by reference to Exhibit 10.18 to McMoRan’s 1998 Form                10-K).                                                                           |
|   |                                                                                                                                                                                                                                                                                                              |
| 10.21  | McMoRan                Form of Notice of Grant of Nonqualified Stock Options and Limited                Rights                under the 2001 Stock Incentive Plan. (Incorporated by reference to                Exhibit                10.21 to McMoRan’s Second-Quarter 2005 Form 10-Q).                   |
|   |                                                                                                                                                                                                                                                                                                              |
| 10.22  | McMoRan                Form of Restricted Stock Unit Agreement Under the 2001 Stock Incentive                Plan. (Incorporated by reference to Exhibit 10.22 to McMoRan’s                Second-Quarter 2005 Form 10-Q).                                                                                  |
|   |                                                                                                                                                                                                                                                                                                              |
| 10.23  | McMoRan                Financial Counseling and Tax Return Preparation and Certification                Program,                effective September 30, 1998. (Incorporated by reference to Exhibit                10.26                to McMoRan’s First-Quarter 2003 Form 10-Q)                          |
|   |                                                                                                                                                                                                                                                                                                              |
| 10.24  | McMoRan                Form of Notice of Grants of Nonqualified Stock Options and Limited                Rights                under the 2003 Stock Incentive Plan. (Incorporated by reference to                Exhibit                10.24 to McMoRan’s Second-Quarter 2005 Form 10-Q).                  |
|   |                                                                                                                                                                                                                                                                                                              |
| 10.25  | McMoRan                Form of Restricted Stock Unit Agreement Under the 2003 Stock Incentive                Plan. (Incorporated by reference to Exhibit 10.25 to McMoRan’s                Second-Quarter 2005 Form 10-Q).                                                                                  |

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Table of Contents
| 10.26  | McMoRan                2004 Director Compensation Plan. (Incorporated by reference to Exhibit                10.29 to McMoRan’s Second-Quarter 2004 Form 10-Q)                                                                                                                                                                                                                                        |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                                                                        |
| 10.27  | Agreement                for Consulting Services between Freeport-McMoRan and B. M. Rankin,                Jr.                effective as of January 1, 1991)(assigned to FM Services as of January                1,                1996); as amended on December 15, 1997 and on December 7, 1998.                (Incorporated by reference to Exhibit 10.32 to McMoRan 1998 Form                10-K). |
|   |                                                                                                                                                                                                                                                                                                                                                                                                        |
| 10.28  | Supplemental                Agreement between FM Services and B.M. Rankin, Jr. effective as of                January                1, 2005. (Incorporated by reference to Exhibit 10.1 to McMoRan’s Current                Report on Form 8-K dated January 19, 2005 (filed January 24,                2005).                                                                                       |
|   |                                                                                                                                                                                                                                                                                                                                                                                                        |
| 10.29  | McMoRan                Director Compensation. (Incorporated by reference to Exhibit 10.27                to                McMoRan’s 2004 Form 10-K).                                                                                                                                                                                                                                                 |
|   |                                                                                                                                                                                                                                                                                                                                                                                                        |
| 10.30  | McMoRan                Exploration Co. 2005 Stock Incentive Plan. (Incorporated by reference                to                Exhibit 10.1 to McMoRan’s Current Report on Form 8-K filed on May 6,                2005).                                                                                                                                                                              |
|   |                                                                                                                                                                                                                                                                                                                                                                                                        |
| 10.31  | Form                of Notice of Grant of Nonqualified Stock Options under the 2005 Stock                Incentive Plan. (Incorporated by reference to Exhibit 10.2 to McMoRan’s                Current Report on Form 8-K filed May 6, 2005).                                                                                                                                                        |
|   |                                                                                                                                                                                                                                                                                                                                                                                                        |
| 10.32  | Form                of Restricted Stock Unit Agreement under the 2005 Stock Incentive                Plan.                (Incorporated by reference to Exhibit 10.3 to McMoRan’s Current Report on                Form 8-K filed May 6, 2005).                                                                                                                                                       |
|   |                                                                                                                                                                                                                                                                                                                                                                                                        |
| 15.1   | Letter                dated November 2, 2005 from Ernst & Young LLP regarding unaudited                interim financial statements.                                                                                                                                                                                                                                                                    |
|   |                                                                                                                                                                                                                                                                                                                                                                                                        |
| 31.1   | Certification                of Principal Executive Officer pursuant to Rule                13a-14(a)/15d-14(a).                                                                                                                                                                                                                                                                                            |
|   |                                                                                                                                                                                                                                                                                                                                                                                                        |
| 31.2   | Certification                of Principal Financial Officer pursuant to Rule                13a-14(a)/15d-14(a).                                                                                                                                                                                                                                                                                            |
|   |                                                                                                                                                                                                                                                                                                                                                                                                        |
| 32.1   | Certification                of Principal Executive Officer pursuant to 18 U.S.C. Section                1350.                                                                                                                                                                                                                                                                                              |
|   |                                                                                                                                                                                                                                                                                                                                                                                                        |
| 32.2   | Certification                of Principal Financial Officer pursuant to 18 U.S.C. Section                1350.                                                                                                                                                                                                                                                                                              |

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