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|-----------------------------------------------------------------------|
| **UNITED                STATES**                                      |
| **SECURITIES                AND EXCHANGE COMMISSION**                 |
| **Washington,                D.C. 20549**                             |
|                                                                  |
| **FORM                10-Q**                                          |
|                                                                  |
| **(Mark                One)**                                         |
| **[X]**                                                               | **QUARTERLY                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE** |
| **SECURITIES                EXCHANGE ACT OF 1934**                    |
| **For                the quarterly period ended March 31, 2007**      |
| **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)                         |
|                                                                                        |

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|                                                                                      |
|-------------------------------------------------------------------------------------------|
| **McMoRan                Exploration Co.**                                                |
| **TABLE                OF CONTENTS**                                                      |
|                                                                                      |
|                                                                                      | Page |
|                                                                                      |   |
| Part                I. Financial Information                                              |   |
|                                                                                      |   |
| Financial                Statements:                                                      |   |
|                                                                                      |   |
| Condensed                Consolidated Balance Sheets                (Unaudited)           | 3 |
|                                                                                      |   |
| Consolidated                Statements of Operations                (Unaudited)           | 4 |
|                                                                                      |   |
| Consolidated                Statements of Cash Flow                (Unaudited)            | 5 |
|                                                                                      |   |
| Notes                to Consolidated Financial                Statements                  | 6 |
|                                                                                      |   |
| Report                of Independent Registered Public Accounting                Firm     | 12 |
|                                                                                      |   |
| Management's                Discussion and Analysis                                       |   |
| of                Financial Condition and Results of                Operations            | 13 |
|                                                                                      |   |
| Quantitative                and Qualitative Disclosures about Market                Risks | 24 |
|                                                                                      |   |
| Controls                and Procedures                                                    | 24 |
|                                                                                      |   |
| Part                II. Other Information                                                 | 24 |
|                                                                                      |   |
| Signature                                                                                 | 25 |
|                                                                                      |   |
| 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**

|                                                                                                   |   | March                31,      |    | December                31, |   |
|--------------------------------------------------------------------------------------------------------|--------|-------------------------------|---------|-----------------------------|--------|
|                                                                                                   |   | 2007                          |    | 2006                        |   |
|                                                                                                   |   | (In                Thousands) |    |
| ASSETS                                                                                                 |   |                          |    |                        |   |   |   |
| Cash                and cash equivalents:                                                              |   |                          |    |                        |   |   |   |
| Continuing                operations                                                                   |   | $                             | 57,683  |                        | $      | 17,830 |   |
| Discontinued                operations, all restricted                                                 |   |                          | 447     |                        |   | 441 |   |
| Restricted                investments                                                             |   |                          | 5,984   |                        |   | 5,930 |   |
| Accounts                receivable                                                                     |   |                          | 44,836  |                        |   | 45,636 |   |
| Inventories                                                                                            |   |                          | 24,066  |                        |   | 25,034 |   |
| Prepaid                expenses                                                                        |   |                          | 7,020   |                        |   | 16,190 |   |
| Current                assets from discontinued operations, excluding cash                             |   |                          | 6,311   |                        |   | 6,051 |   |
| Total                current assets                                                                    |   |                          | 146,347 |                        |   | 117,112 |   |
| Property,                plant and equipment, net                                                      |   |                          | 288,641 |                        |   | 282,538 |   |
| Discontinued                sulphur business assets                                                    |   |                          | 359     |                        |   | 362 |   |
| Restricted                investments and cash                                                         |   |                          | 3,288   |                        |   | 3,288 |   |
| Other                assets                                                                            |   |                          | 7,144   |                        |   | 5,377 |   |
| Total                assets                                                                            |   | $                             | 445,779 |                        | $      | 408,677 |   |
|                                                                                                   |   |                          |    |                        |   |   |   |
| LIABILITIES                AND STOCKHOLDERS’ DEFICIT                                             |   |                          |    |                        |   |   |   |
| Accounts                payable                                                                        |   | $                             | 61,806  |                        | $      | 85,504 |   |
| Accrued                liabilities                                                                     |   |                          | 29,212  |                        |   | 32,844 |   |
| Accrued                interest and dividends payable                                                  |   |                          | 5,425   |                        |   | 5,479 |   |
| Current                portion of accrued oil and gas reclamation costs                                |   |                          | 3,824   |                        |   | 2,604 |   |
| Current                portion of accrued sulphur reclamation cost                                     |   |                          | 12,506  |                        |   | 12,909 |   |
| Current                liabilities from discontinued operations                                        |   |                          | 2,259   |                        |   | 3,678 |   |
| Total                current liabilities                                                               |   |                          | 115,032 |                        |   | 143,018 |   |
| 6%                convertible senior notes                                                             |   |                          | 100,870 |                        |   | 100,870 |   |
| 5¼%                convertible senior notes                                                       |   |                          | 115,000 |                        |   | 115,000 |   |
| Senior                secured term loan                                                                |   |                          | 100,000 |                        |   | - |   |
| Senior                secured revolving credit facility                                                |   |                          | -       |                        |   | 28,750 |   |
| Accrued                oil and gas reclamation costs                                                   |   |                          | 23,729  |                        |   | 23,272 |   |
| Accrued                sulphur reclamation costs                                                       |   |                          | 10,620  |                        |   | 10,185 |   |
| Contractual                postretirement obligation related to discontinued                operations |   |                          | 10,235  |                        |   | 9,831 |   |
| Other                long-term liabilities                                                             |   |                          | 16,952  |                        |   | 17,151 |   |
| 5%                mandatorily redeemable convertible preferred stock                                   |   |                          | 29,074  |                        |   | 29,043 |   |
| Stockholders'                deficit                                                                   |   |                          | (75,733 | )                           |   | (68,443 | ) |
| Total                liabilities and stockholders' deficit                                             |   | $                             | 445,779 |                        | $      | 408,677 |   |
|                                                                                                   |   |                          |    |                        |   |   |   |

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**TABLE OF CONTENTS**
**McMoRan      EXPLORATION CO.**

**CONSOLIDATED      STATEMENTS OF OPERATIONS(Unaudited**

|                                                                               |   | Three                Months Ended March 31,             |    |
|------------------------------------------------------------------------------------|--------|---------------------------------------------------------|---------|
|                                                                               |   | 2007                                                    |    | 2006 |   |
|                                                                               |   | (In                Thousands, Except Per Share Amounts) |    |
| Revenues:                                                                          |   |                                                    |    |   |   |   |   |
| Oil                & Gas                                                       |   | $                                                       | 51,375  |   | $ | 35,441 |   |
| Service                                                                            |   |                                                    | 322     |   |   | 4,305 |   |
| Total                revenues                                                      |   |                                                    | 51,697  |   |   | 39,746 |   |
| Costs                and expenses:                                                 |   |                                                    |    |   |   |   |   |
| Production                and delivery costs                                       |   |                                                    | 17,728  |   |   | 10,759 |   |
| Depletion,                depreciation and amortization                            |   |                                                    | 27,035  |   |   | 5,844 |   |
| Exploration                expenses                                                |   |                                                    | 9,755   |   |   | 20,620 |   |
| General                and administrative expenses                                 |   |                                                    | 6,397   |   |   | 8,224 |   |
| Start-up                costs for Main Pass Energy Hub™                      |   |                                                    | 2,705   |   |   | 1,846 |   |
| Insurance                recovery                                                  |   |                                                    | -       |   |   | (1,169 | ) |
| Total                costs and expenses                                            |   |                                                    | 63,620  |   |   | 46,124 |   |
| Operating                loss                                                      |   |                                                    | (11,923 | ) |   | (6,378 | ) |
| Interest                expense, net                                               |   |                                                    | (5,654  | ) |   | (1,833 | ) |
| Other                income (expense), net                                         |   |                                                    | 748     |   |   | (3,194 | ) |
| Loss                from continuing operations                                     |   |                                                    | (16,829 | ) |   | (11,405 | ) |
| Income                (loss) from discontinued operations                          |   |                                                    | 2,331   |   |   | (1,677 | ) |
| Net                loss                                                            |   |                                                    | (14,498 | ) |   | (13,082 | ) |
| Preferred                dividends and amortization of convertible preferred stock |   |                                                    |    |   |   |   |   |
| issuance                costs                                                      |   |                                                    | (405    | ) |   | (403 | ) |
| Net                loss applicable to common stock                                 |   | $                                                       | (14,903 | ) | $ | (13,485 | ) |
|                                                                               |   |                                                    |    |   |   |   |   |
| Basic                and diluted net loss per share of common stock:               |   |                                                    |    |   |   |   |   |
| Continuing                operations                                               |   |                                                    | $(0.61  | ) |   | $                (0.44 | ) |
| Discontinued                operations                                             |   |                                                    | 0.08    |   |   |    (0.06 | ) |
| Net                loss per share of common stock                                  |   |                                                    | $(0.53  | ) |   | $                (0.50 | ) |
|                                                                               |   |                                                    |    |   |   |   |   |
| Basic                and diluted average shares outstanding                        |   |                                                    | 28,358  |   |   | 26,832 |   |

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**TABLE OF      CONTENTS**

**McMoRan      EXPLORATION CO.**

**CONSOLIDATED      STATEMENTS OF CASH FLOW (Unaudited**

|                                                                               |   | Three                Months Ended |    |
|------------------------------------------------------------------------------------|--------|-----------------------------------|---------|
|                                                                               |   | March                31,          |    |
|                                                                               |   | 2007                              |    | 2006 |   |
|                                                                               |   | (In                Thousands)     |    |
| **Cash                flow from operating activities:**                            |   |                              |    |   |   |   |   |
| Net                loss                                                            |   | $                                 | (14,498 | ) | $ | (13,082 | ) |
| Adjustments                to reconcile net loss to net cash provided by (used in) |   |                              |    |   |   |   |   |
| operating                activities:                                               |   |                              |    |   |   |   |   |
| (Income)                loss from discontinued operations                          |   |                              | (2,331  | ) |   | 1,677 |   |
| Depreciation                and amortization                                       |   |                              | 27,035  |   |   | 5,844 |   |
| Exploration                drilling and related expenditures                       |   |                              | 1,124   |   |   | 12,342 |   |
| Compensation                expense associated with stock-based awards             |   |                              | 6,507   |   |   | 9,675 |   |
| Amortization                of deferred financing costs                            |   |                              | 604     |   |   | 481 |   |
| Loss                on induced conversion of convertible senior notes              |   |                              | -       |   |   | 4,301 |   |
| Reclamation                expenditures                                            |   |                              | (721    | ) |   | - |   |
| Other                                                                              |   |                              | (524    | ) |   | 470 |   |
| (Increase)                decrease in working capital:                             |   |                              |    |   |   |   |   |
| Accounts                receivable                                                 |   |                              | (7,613  | ) |   | 506 |   |
| Accounts                payable and accrued liabilities                            |   |                              | (8,810  | ) |   | (17,237 | ) |
| Prepaid                expenses and inventories                                    |   |                              | 10,140  |   |   | (10,892 | ) |
| Increase                in working capital                                         |   |                              | (6,283  | ) |   | (27,623 | ) |
| Net                cash provided by (used in) continuing operations                |   |                              | 10,913  |   |   | (5,915 | ) |
| Net                cash used in discontinued operations                            |   |                              | (2,429  | ) |   | (3,490 | ) |
| Net                cash provided (used in) by operating activities                 |   |                              | 8,484   |   |   | (9,405 | ) |
|                                                                               |   |                              |    |   |   |   |   |
| **Cash                flow from investing activities:**                            |   |                              |    |   |   |   |   |
| Exploration,                development and other capital expenditures             |   |                              | (38,379 | ) |   | (68,847 | ) |
| Proceeds                from restricted investments                                |   |                              | -       |   |   | 7,400 |   |
| (Increase)                decrease in restricted investments                       |   |                              | (54     | ) |   | 69 |   |
| Net                cash used in continuing operations                              |   |                              | (38,433 | ) |   | (61,378 | ) |
| Net                cash used in discontinued operations                            |   |                              | -       |   |   | - |   |
| Net                cash used in investing activities                               |   |                              | (38,433 | ) |   | (61,378 | ) |
|                                                                               |   |                              |    |   |   |   |   |
| **Cash                flow from financing activities:**                            |   |                              |    |   |   |   |   |
| Proceeds                from senior secured term loan                              |   |                              | 100,000 |   |   | - |   |
| Payments                under senior secured revolving credit facility, net        |   |                              | (28,750 | ) |   | - |   |
| Financing                costs                                                     |   |                              | (2,177  | ) |   | - |   |
| Payments                for induced conversion of convertible senior notes         |   |                              | -       |   |   | (4,301 | ) |
| Dividends                paid on convertible preferred stock                       |   |                              | (374    | ) |   | (747 | ) |
| Proceeds                from exercise of stock options and other                   |   |                              | 1,109   |   |   | 39 |   |
| Net                cash provided by (used in) continuing operations                |   |                              | 69,808  |   |   | (5,009 | ) |
| Net                cash from discontinued operations                               |   |                              | -       |   |   | - |   |
| Net                cash provided by (used in) financing activities                 |   |                              | 69,808  |   |   | (5,009 | ) |
| Net                increase (decrease) in cash and cash equivalents                |   |                              | 39,859  |   |   | (75,792 | ) |
| Cash                and cash equivalents at beginning of year                      |   |                              | 18,271  |   |   | 132,184 |   |
| Cash                and cash equivalents at end of period                          |   |                              | 58,130  |   |   | 56,392 |   |
| Less                restricted cash from continuing operations                     |   |                              | -       |   |   | (1 | ) |
| Less                restricted cash from discontinued operations                   |   |                              | (447    | ) |   | (548 | ) |
| Unrestricted                cash and cash equivalents at end of period             |   | $                                 | 57,683  |   | $ | 55,843 |   |

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**TABLE OF CONTENTS**
**McMoRan      EXPLORATION CO.**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

| **1.  ** | **BASIS                OF PRESENTATION** |
|--------------------|------------------------------------------|

**2.      STOCK-BASED COMPENSATION **

** **

|                                                                         |   |   |   |   | Three                Months Ended |   |
|------------------------------------------------------------------------------|--------|--------|--------|--------|-----------------------------------|--------|
|                                                                         |   |   |   |   | March                31,          |   |
|                                                                         |   |   |   |   | 2007                              |   | 2006 |   |
| Stock                options awarded to employees (including directors)      |   |   |   |   | $                                 | 6,281  |   | $ | 9,364 |   |
| Stock                options awarded to non-employees and advisory directors |   |   |   |   |                              | 220    |   |   | 259 |   |
| Restricted                stock units                                        |   |   |   |   |                              | 6      |   |   | 52 |   |
| Total                compensation cost                                       |   |   |   |   | $                                 | 6,507  |   | $ | 9,675 |   |

** **

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**TABLE OF CONTENTS**
|                                     |      |   |     |   | Weighted                    |   |      |   |
|------------------------------------------|-----------|--------|----------|--------|-----------------------------|--------|-----------|--------|
|                                     |      |   | Weighted |   | Average                     |   | Aggregate |   |
|                                     | Number    |   | Average  |   | Remaining                   |   | Intrinsic |   |
|                                     | Of        |   | Option   |   | Contractual                 |   | Value     |   |
|                                     | Options   |   | Price    |   | Term                (years) |   | ($000)    |   |
| Balance                at January 1      | 7,095,991 |   | $        | 15.50  |                        |   |      |   |   |   |
| Granted                                  | 1,325,250 |   |     | 12.23  |                        |   |      |   |   |   |
| Exercised                                | (155,995  | )      |     | 7.11   |                        |   |      |   |   |   |
| Expired/Forfeited                        | (12,832   | )      |     | 18.55  |                        |   |      |   |   |   |
| Balance                at March 31       | 8,252,414 |   |     | 15.06  |                        | 6.6    |      | $      | 124,872 |   |
| Vested                and exercisable at |      |   |     |   |                        |   |      |   |   |   |
| March                31                  | 6,111,322 |   |     | 14.90  |                        | 5.8    |      | $      | 91,078 |   |
|                                     |      |   |     |   |                        |   |      |   |   |   |

|                                                                |   |   | 2007  |   |   |   | 2006  |   |
|---------------------------------------------------------------------|--------|--------|-------|--------|--------|--------|-------|--------|
| Fair                value (per share) of stock option on grant date |   | $      | 6.89  | a      |   | $      | 11.91 | b      |
| Expected                and weighted average volatility             |   |   | 52.23 | %      |   |   | 55.5  | %      |
| Expected                life of options (in years)                  |   |   | 6.29  | a      |   |   | 7     |   |
| Risk-free                interest rate                              |   |   | 4.75  | %      |   |   | 4.5   | %      |

| a.   | Excludes                stock options that were granted with immediate vesting (445,000 shares,                including 400,000 shares granted to the Co-Chairmen in lieu of cash                compensation for 2007) with an expected life of 6.56 years and fair                value                of stock options on grant date of $7.02 per                share. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| b.   | Excludes                stock options representing 500,000 shares granted with immediate                vesting                to the Co-Chairmen in lieu of cash compensation for 2006 with an                expected                life of six years and fair value of the options on grant date of                $11.52                per share. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**3.      **
**SENIOR**
**      SECURED TERM LOAN**

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**TABLE OF CONTENTS**

**4.      EARNINGS PER SHARE**

|                                                          |   | First                Quarter  |   |
|---------------------------------------------------------------|--------|-------------------------------|--------|
|                                                          |   | 2007                          |   |   | 2006 |   |
|                                                          |   | (in                thousands) |   |
| In-the-money                stock options a                ,b |   |                          | 608    |   |   |   | 1,402 |   |
| Stock                warrants a,c                             |   |                          | 1,511  |   |   |   | 1,810 |   |
| 5%                convertible preferred stock d               |   |                          | 6,205  |   |   |   | 6,214 |   |
| 6%                convertible senior notes e                  |   |                          | 7,079  |   |   |   | 7,080 |   |
| 5¼%                convertible senior notes f            |   |                          | 6,938  |   |   |   | 6,938 |   |
|                                                          |   |                          |   |   |   |   |   |   |

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

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

| c.   | Includes                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 2006 Form 10-K for additional information regarding                the warrants. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| d.   | 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 is convertible into 5.1975 shares of McMoRan common stock.                See Note                6 of McMoRan’s 2006 Form 10-K, for additional information regarding                McMoRan’s convertible preferred stock, including McMoRan’s ability to                redeem the shares for cash after June 30,                2007. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| e.   | 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. Net interest                expense on the 6% convertible senior notes totaled $1.5 million during                the                first quarter of 2007 and $1.0 million during the first quarter of                2006.                Additional information regarding McMoRan’s 6% convertible senior notes is                disclosed in Note 5 of its 2006 Form 10-K. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| f.   | 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.                Net                interest expense on the 5¼% convertible senior notes totaled $1.4 million                during the first quarter of 2007 and $0.8 million during the first                quarter                of 2006. Additional information regarding McMoRan’s 5¼% convertible senior                notes is disclosed in Note 5 of its 2006 Form 10-K. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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**TABLE OF      CONTENTS**

|                                              |   | First                Quarter |   |
|---------------------------------------------------|--------|------------------------------|--------|
|                                              |   | 2007                         |   |   | 2006 |   |
| Outstanding                options (in thousands) |   |                         | 5,730  |   |   |   | 1,751 |   |
| Average                exercise price per share   |   | $                            | 17.44  |   |   | $ | 20.30 |   |

**5.      OTHER MATTERS**

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**TABLE OF CONTENTS**
** **

|                                                 | Pension                  Benefits |   | Other                  Benefits |   |
|------------------------------------------------------|-----------------------------------|--------|---------------------------------|--------|
|                                                 | 2007                              |   | 2006                            |   | 2007 |   | 2007 |   |
| Service                  cost                        | $                                 | -      |                            | $      | - |   | $ | 5 |   | $ | 5 |   |
| Interest                  cost                       |                              | 58     |                            |   | 84 |   |   | 86 |   |   | 85 |   |
| Return                  on plan assets               |                              | (18    | )                               |   | (8 | ) |   | - |   |   | - |   |
| Amortization                  of prior service costs |                              |   |                            |   |   |   |   |   |   |   |   |   |
| and                  actuarial gains                 |                              | -      |                            |   | - |   |   | 14 |   |   | 22 |   |
| Net                  periodic benefit expense        | $                                 | 40     |                            | $      | 76 |   | $ | 105 |   | $ | 112 |   |

| Oil                and Natural Gas                                |   |   |   |
|-------------------------------------------------------------------|--------|--------|--------|
| Asset                retirement obligation at beginning of year   | $      | 25,876 |   |
| Liabilities                settled                                |   | (1,944 | )a     |
| Accretion                expense                                  |   | 428    |   |
| Incurred                liabilities                               |   | -      |   |
| Revision                for changes in estimates                  |   | 3,193  | b      |
| Asset                retirement obligations at March 31, 2007     | $      | 27,553 |   |
|                                                              |   |   |   |
| Sulphur                                                           |   |   |   |
| Asset                retirement obligations at beginning of year: | $      | 23,094 |   |
| Liabilities                settled                                |   | (402   | )      |
| Accretion                expense                                  |   | 434    |   |
| Revision                for changes in estimates                  |   | -      |   |
| Asset                retirement obligation at March 31, 2007      | $      | 23,126 |   |

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**TABLE OF      CONTENTS**

**6.      COMPREHENSIVE LOSS**

| Net                loss                                             | $      | (14,498 | )      |
|---------------------------------------------------------------------|--------|---------|--------|
| Other                comprehensive income (loss):                   |   |    |   |
| Amortization                of minimum pension liability adjustment |   | 14      |   |
| Total                accumulated comprehensive loss                 | $      | (14,484 | )      |
|                                                                |   |    |   |

**7.      NEW ACCOUNTING STANDARDS**

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

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**TABLE OF CONTENTS**

REPORT      OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING      FIRM

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**TABLE OF CONTENTS**
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, 2006 (2006 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**

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**TABLE      OF CONTENTS**

|                                                                                                  |  **Working****Interest** | **Net****Revenue****Interest** |  **Prospect                Acreage****a** | **Water                Depth** | **Proposed                Total****Depth****b** |  **Recent                Depth** | **Spud                Date**    |
|-------------------------------------------------------------------------------------------------------|-------------------------------|--------------------------------|------------------------------------------------|--------------------------------|-------------------------------------------------|---------------------------------------|---------------------------------|
|                                                                                                  | %                             | %                              |                                           | Feet                           | feet                                            | Feet                                  |                            |
| South                Timbalier Block 70“Cas”                d                             | 15.0                          | 12.4                           | 5,000                                          | 65                             | 25,000                                          | 13,400                                | January                30, 2007 |
| Vermilion                Block 31“Cottonwood                Point”                c       | 15.0                          | 11.3                           | 5,523                                          | 15                             | 21,000                                          | 12,300                                | March                1, 2007    |
| South                Marsh Island Block 212“Flatrock”                c,d                  | 25.0                          | 18.8                           | 3,805                                          | 10                             | 16,500                                          | 11,200                                | March                27, 2007   |
| Louisiana                State Lease 340“Mound                Point South” d              | 18.3                          | 14.5                           | 6,400                                          | 8                              | 20,000                                          | 5,500                                 | April                12, 2007   |
| Louisiana                State Lease 18350“Point                Chevreuil #2 Development” | 25.0                          | 17.5                           | 4,303                                          | <10                         | 14,500                                          | 12,900                                | April                12, 2007   |
| **Near-Term                Exploration Well**                                                         |                          |                           |                                           |                           |                                            |                                  |                            |
| Matagorda                Island Blocks 526/557“Deep                Cavallo”               | 40.0                          | 29.8                           | 6,878                                          | 70                             | 14,000                                          | n/a                                   | Mid-2007                        |

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

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

| c.                 | Prospect                will be eligible for deep gas royalty relief under current Minerals                Management Service (MMS) guidelines, which could result in an increased                net revenue interest for early production. If MMS approves the application                for royalty relief, each lease may be exempt from paying MMS royalties                on                up to the initial 25 Bcf of                production. |
|------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| d.                 | Wells                in which we are the operator. |
|------------------------------|----------------------------------------------------|

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**TABLE OF      CONTENTS**

**MAIN      PASS ENERGY HUB**
**™**

**      PROJECT**

**™**

**™**

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**TABLE      OF CONTENTS**

**RESULTS      OF OPERATIONS**

** **

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**TABLE      OF CONTENTS**

|                                                 | Three                Months Ended |
|------------------------------------------------------|-----------------------------------|
|                                                 | March                31,          |
| OPERATING                DATA:                       | 2007                              |   | 2006 |
| Sales                Volumes                         |                              |   |   |
| Gas                (thousand cubic feet, or Mcf)     | 3,849,100                         |   | 2,159,400 |
| Oil                (barrels) a                  | 344,400                           |   | 296,900 |
| Plant                products (equivalent barrels) b | 72,600                            |   | 14,300 |
| Average                Realization                   |                              |   |   |
| Gas                (per Mcf)                         | $                7.59             |   | $                8.12 |
| Oil                (per barrel)                      | 54.24                             |   | 57.15 |

| a.                 | Sales                volumes from Main Pass totaled approximately 160,200 barrels in the                first                quarter of 2007 compared with 199,300 barrels in the first quarter                of                2006. Main Pass produces sour crude oil, which sells at a discount                to                other crude oils. |
|------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| b.                 | We                received approximately $3.4 million and $0.8 million of revenues                associated with plant products (ethane, propane, butane, etc.) during                the                first quarters of 2007 and 2006, respectively (see “Oil and Gas                Operations” below). |
|------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Oil      and Gas Operations**

|                                                            | First   |   |
|-----------------------------------------------------------------|---------|--------|
|                                                            | Quarter |   |
| Oil                and natural gas revenues - prior year period | $       | 35,441 |   |
| Increase                (decrease)                              |    |   |   |
| Sales                volumes:                                   |    |   |   |
| Oil                and condensate                               |    | 3,280  |   |
| Natural                gas                                      |    | 13,726 |   |
| Price                realizations:                              |    |   |   |
| Oil                and condensate                               |    | (1,571 | ) |
| Natural                gas                                      |    | (2,038 | ) |
| Plant                products revenues                          |    | 2,589  |   |
| Other                                                           |    | (52    | ) |
| Oil                and gas revenues - current year period       | $       | 51,375 |   |

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**TABLE      OF CONTENTS**

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**TABLE OF CONTENTS**
|                                                       | Three                Months Ended |   |
|------------------------------------------------------------|-----------------------------------|--------|
|                                                       | March                31,          |   |
|                                                       | 2007                              |   | 2006 |   |
| Geological                and geophysical,                 |                              |   |   |   |   |   |
| including                3-D seismic purchases a           | $                                 | 6.9    |   | $ | 7.0 |   |
| Non                productive exploratory costs, including |                              |   |   |   |   |   |
| related                lease costs                         |                              | 1.1    | b |   | 12.3 | c |
| Other                                                      |                              | 1.8    |   |   | 1.3 |   |
|                                                       | $                                 | 9.8    |   | $ | 20.6 |   |

| a.   | Includes                compensation costs associated with outstanding stock-based awards                totaling                $3.2 million in the first quarter of 2007 and $5.0 million in the                first                quarter of 2006 (see “Stock-Based Compensation” below and Note                2). |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| b.   | Primarily                reflects the nonproductive exploratory well drilling and related                costs                associated with the “Marlin” well at Grand Isle Block 18 evaluated to be                nonproductive in January 2007. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| c.   | Includes                nonproductive exploratory well drilling and related costs primarily                associated with a well at South Pass Block 26 ($8.1 million) and                wells                West Cameron Block 95 ($2.5 million) and South Marsh Island Block                230                ($1.7 million), which were evaluated as being non-productive in January                2006. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Other      Financial Results**

**CAPITAL      RESOURCES AND LIQUIDITY**

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**TABLE      OF      CONTENTS**

|                                 | Three                Months Ended |   |
|--------------------------------------|-----------------------------------|--------|
|                                 | March                31,          |   |
|                                 | 2007                              |   |   | 2006 |   |
| Continuing                operations |                              |   |   |   |   |   |   |
| Operating                            | $                                 | 10.9   |   |   | $ | (5.9 | ) |
| Investing                            |                              | (38.4  | ) |   |   | (61.4 | ) |
| Financing                            |                              | 69.8   |   |   |   | (5.0 | ) |

| Discontinued                operations |   |   |   |   |   |   |   |
|----------------------------------------|--------|--------|--------|--------|--------|--------|--------|
| Operating                              |   | (2.4   | )      |   |   | (3.5   | )      |
| Investing                              |   | -      |   |   |   | -      |   |
| Financing                              |   | -      |   |   |   | -      |   |
|                                   |   |   |   |   |   |   |   |
| Total                cash flow         |   |   |   |   |   |   |   |
| Operating                              |   | 8.5    |   |   |   | (9.4   | )      |
| Investing                              |   | (38.4  | )      |   |   | (61.4  | )      |
| Financing                              |   | 69.8   |   |   |   | (5.0   | )      |

**First-Quarter      2007 Cash Flows Compared with First-Quarter 2006**

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**TABLE      OF CONTENTS**

**Senior      Secured Debt Financings **

**Debt      Conversion Transactions**

**STOCK-BASED      COMPENSATON**

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**TABLE OF      CONTENTS**

|                                               |   | Three                Months Ended |   |
|----------------------------------------------------|--------|-----------------------------------|--------|
|                                               |   | March                31,          |   |
|                                               |   | 2007                              |   | 2006 |   |
| General                and administrative expenses |   | $                                 | 3,056  |   | $ | 4,651 |   |
| Exploration                expenses                |   |                              | 3,214  |   |   | 4,999 |   |
| Main                Pass Energy Hub start-up costs |   |                              | 237    |   |   | 25 |   |
| Total                stock-based compensation cost |   | $                                 | 6,507  |   | $ | 9,675 |   |
|                                               |   |                              |   |   |   |   |   |

**DISCONTINUED      OPERATIONS**

|                                                      |   | First                Quarter |   |
|-----------------------------------------------------------|--------|------------------------------|--------|
|                                                      |   | 2007                         |   | 2006 |   |
| Sulphur                retiree costs                      |   | $                            | 435    |   | $ | 460 |   |
| Legal                expenses                             |   |                         | 31     |   |   | 50 |   |
| Caretaking                costs                           |   |                         | 184    |   |   | 430 |   |
| Accretion                expense - sulphur                |   |                         |   |   |   |   |   |
| reclamation                obligations                    |   |                         | 434    |   |   | 348 |   |
| Insurance                                                 |   |                         | 388    |   |   | 418 |   |
| General                and administrative                 |   |                         | 28     |   |   | 31 |   |
| Other                                                     |   |                         | (3,831 | )a |   | (60 | ) |
| (Income)                loss from discontinued operations |   | $                            | (2,331 | ) | $ | 1,677 |   |

**NEW      ACCOUNTING STANDARDS**

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**TABLE      OF CONTENTS**

**CAUTIONARY      STATEMENT**

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**TABLE OF CONTENTS**

Quantitative      and Qualitative Disclosures about Market      Risk.

Controls      and Procedures

PART      II--OTHER INFORMATION

|                                     | Votes                Cast For | Authority                Withheld |
|------------------------------------------|-------------------------------|-----------------------------------|
| 1.                Election of Directors: |                          |                              |
| Richard                C. Adkerson       | 26,529,749                    | 242,999                           |
| Robert                A. Day             | 26,661,173                    | 111,575                           |
| Gerald                J. Ford            | 26,315,006                    | 457,742                           |
| H.                Devon Graham, Jr.      | 25,417,052                    | 1,355,696                         |
| Suzanne                T. Mestayer       | 26,656,453                    | 116,295                           |
| James                R. Moffett          | 26,538,964                    | 233,784                           |
| B.                M. Rankin, Jr.         | 26,275,918                    | 496,830                           |
| J.                Taylor Wharton         | 25,424,639                    | 1,348,109                         |

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**TABLE      OF CONTENTS**

|                                                                            | For        | Against | Abstentions |
|---------------------------------------------------------------------------------|------------|---------|-------------|
| 2.                Ratification of Ernst & Young LLP as independent auditors | 26,711,210 | 42,325  | 19,213      |

SIGNATURE

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**TABLE OF CONTENTS**

**McMoRan      Exploration Co.**

**Exhibit      Index**

**Exhibit      Number**

| 2.1    | Agreement                and Plan of Merger 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 January 30,                2006.                (Incorporated by reference to Exhibit 3.3 to McMoRan’s Current Report on                Form 8-K dated January 30, 2006 (filed February 3, 2006)).                                                                                                                                                                                                                                                                                |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 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 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 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 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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**TABLE OF CONTENTS**
| 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   | Purchase                Agreement dated September 30, 2004, by and among McMoRan Exploration                Co.,                Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith                Incorporated, and J.P. Morgan Securities Inc. (Incorporated by reference                to Exhibit 99.2 to McMoRan’s Current Report on Form 8-K dated October 6,                2004 (filed October 7, 2004).                                                  |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 4.13   | 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)).                                                                                                                                                                         |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 4.14   | 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)).                                                     |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 4.15   | 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 to McMoRan’s 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.)                                                                                                                                                                                                    |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |

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**TABLE      OF      CONTENTS**

| 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).                                                                                                                                                 |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 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                (Incorporated by reference to Exhibit 10.18 to McMoRan’s 2002 Form                10-K).                                                                                                                                         |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 10.12  | Credit                Agreement dated as of April 19, 2006 among McMoRan Oil & Gas LLC as                borrower, JP Morgan Chase Bank, N.A., as administrative agent,                Toronto-Dominion (Texas) LLC, as syndication agent and the Lenders                Party                Hereto. (Incorporated by reference to Exhibit 10.1 to McMoRan’s Current                Report on Form 8-K dated April 19, 2006).  |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 10.13  | First                Amendment to Credit Agreement effective January 19, 2007 among McMoRan                Oil                & Gas LLC as borrower, JP Morgan Chase Bank, N.A, as administrative                agent, Toronto-Dominion (Texas) LLC, as syndication agent and the                Lenders                Party Hereto (Incorporated by reference to Exhibit 10.14 to McMoRan’s 2006                Form 10-K) . |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 10.14  | Senior                Term Loan Agreement effective as of January 19, 2007 among McMoRan                Oil                & Gas LLC as borrower, JP Morgan Chase Bank, N.A., as administrative                agent, TD Securities (USA) LLC, as syndication agent and the Lenders                Party                Hereto (Incorporated by reference to Exhibit 10.14 to McMoRan’s 2006 Form                10-K).         |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|   | Executive                and Director Compensation Plans and Arrangements (Exhibits 10.15                through                10.36).                                                                                                                                                                                                                                                                                                   |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 10.15  | McMoRan                Adjusted Stock Award Plan, as amended and restated.                                                                                                                                                                                                                                                                                                                                                                |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 10.16  | McMoRan                1998 Stock Option Plan, as amended and restated.                                                                                                                                                                                                                                                                                                                                                                   |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 10.17  | McMoRan                1998 Stock Option Plan for Non-Employee Directors, as amended and                restated.                                                                                                                                                                                                                                                                                                                         |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 10.18  | McMoRan                Form of Notice of Grant of Nonqualified Stock Options under the 1998                Stock                Option Plan. (Incorporated by reference to Exhibit 10.15 to McMoRan’s                Second Quarter 2005 Form 10-Q).                                                                                                                                                                                |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 10.19  | McMoRan                2000 Stock Incentive Plan, as amended and restated.                                                                                                                                                                                                                                                                                                                                                                |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 10.20  | McMoRan                Form of Notice of Grant of Nonqualified Stock Options under the 2000                Stock                Incentive Plan. (Incorporated by reference to Exhibit 10.17 to McMoRan’s                Second Quarter 2005 Form 10-Q).                                                                                                                                                                             |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 10.21  | McMoRan                2001 Stock Incentive Plan, as amended and restated.                                                                                                                                                                                                                                                                                                                                                                |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 10.22  | McMoRan                2003 Stock Incentive Plan, as amended and restated.                                                                                                                                                                                                                                                                                                                                                                |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 10.23  | 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).                                                                                                                                                                                                   |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 10.24  | McMoRan                Form of Notice of Grant of Nonqualified Stock Options under the 2001                Stock                Incentive Plan. (Incorporated by reference to Exhibit 10.21 to McMoRan’s                Second Quarter 2005 Form 10-Q).                                                                                                                                                                             |

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**TABLE OF      CONTENTS**

|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 10.25  | 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).                                                                                                                                                                                                                          |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| 10.26  | McMoRan                  Exploration Co. Executive Services Program (Incorporated by reference                  to                  Exhibit 10.8 to McMoRan’s May 1, 2006 Form 8-K).                                                                                                                                                                                                                                                                      |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| 10.27  | McMoRan                  Form of Notice of Grants of Nonqualified Stock Options under the                  2003                  Stock Incentive Plan. (Incorporated by reference to Exhibit 10.24                  to                  McMoRan’s Second Quarter 2005 Form 10-Q).                                                                                                                                                                         |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| 10.28  | 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).                                                                                                                                                                                                                          |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| 10.29  | McMoRan                  2004 Director Compensation Plan, as amended and restated.                                                                                                                                                                                                                                                                                                                                                                              |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| 10.30  | Form                  of Amendment No. 1 to Notice of Grant of Nonqualified Stock Options                  under                  the 2004 Director Compensation Plan. (Incorporated by reference                  to Exhibit                  10.7 to McMoRan’s May 1, 2006 Form 8-K).                                                                                                                                                                   |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| 10.31  | Agreement                  for Consulting Services between Freeport-McMoRan Inc. and B. M.                  Rankin,                  Jr. effective as of January 1, 1991)(assigned to FM Services Company                  as of                  January 1, 1996); as amended on December 15, 1997 and on December                  7, 1998.                  (Incorporated by reference to Exhibit 10.32 to McMoRan’s 1998 Form                  10-K). |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| 10.32  | Supplemental                  Letter Agreement between FM Services Company and B.M. Rankin, Jr.                  effective as of January 1, 2007 (Incorporated by reference to Exhibit                  10.32 to McMoRan’s 2006 Form 10-K).                                                                                                                                                                                                               |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| 10.33  | McMoRan                  Director Compensation. (Incorporated by reference to Exhibit 10.27                  to                  McMoRan’s 2004 Form 10-K).                                                                                                                                                                                                                                                                                               |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| 10.34  | McMoRan                  Exploration Co. 2005 Stock Incentive Plan, as amended and restated.                                                                                                                                                                                                                                                                                                                                                                    |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| 10.35  | 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).                                                                                                                                                                                     |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| 10.36  | 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 April 30, 2007 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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