SECURITIES AND EXCHANGE COMMISSION
                     Washington,  D.C. 20549

                            FORM 10-Q

     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                 SECURITIES EXCHANGE ACT OF 1934

            For the Quarter Ended September 30, 1998



                 Commission File Number: 1-13617



                  Freeport-McMoRan Sulphur Inc.



   Incorporated in Delaware              72-1392855
                              (IRS Employer Identification No.)


       1615 Poydras Street, New Orleans, Louisiana  70112


 Registrant's telephone number, including area code: (504) 582-4000


Indicate by check mark whether the  registrant (1) has filed  all
reports required  to be  filed  by Section  13  or 15(d)  of  the
Securities Exchange Act  of 1934 during  the preceding 12  months
(or for such shorter period that  the registrant was required  to
file such  reports), and  (2) has  been  subject to  such  filing
requirements for the past 90 days. Yes X No


On  September  30,  1998,  there  were  issued  and   outstanding
8,790,646 shares  of the  registrant's  Common Stock,  par  value
$0.01 per share. 




                  FREEPORT-McMoRan SULPHUR INC.

                        TABLE OF CONTENTS
                                                            Page
 Part I.  Financial Information

   Financial Statements:

      Condensed Balance Sheets                               3

      Statements of Operations                               4

      Statements of Cash Flow                                5

      Notes to Financial Statements                          6

   Remarks                                                   7

   Report of Independent Public Accountants                  8

   Management's  Discussion  and  Analysis  of   
      Financial Condition
      and Results of Operations                              9

 Part II.  Other Information                                 14

 Signature                                                   15

 Exhibit Index                                              E-1



<PAGE>                            2



                  FREEPORT-McMoRan SULPHUR INC.
                 PART I.  FINANCIAL INFORMATION

Item 1. Financial Statements.


                       FREEPORT-McMoRan SULPHUR INC.
                   CONDENSED BALANCE SHEETS (Unaudited)
<TABLE>
<CAPTION>
                                         September 30,  December 31,
                                             1998          1997 
                                         ------------   -----------
                                               (In Thousands)
<S>                                         <C>          <C>
ASSETS
Current assets:
Cash and cash equivalents                   $ 26,112     $ 21,293
Accounts receivable                           20,943       33,739
Inventories                                   18,008       34,421
Prepaid expenses and other                     9,863        5,982
                                            --------     --------
      Total current assets                    74,926       95,435
Property, plant and equipment, net           102,567      109,833
Deferred tax asset                            53,604       56,757
Other assets                                  13,384       11,008
                                            --------     --------
Total assets                                $244,481     $273,033
                                            ========     ========

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities    $ 25,447     $ 25,175
Current portion of reclamation 
  and mine shutdown reserves                  16,193        4,656 
                                            --------     --------
      Total current liabilities               41,640       29,831
Reclamation and mine shutdown reserves        48,934       67,518
Accrued postretirement and pension benefits   10,553       15,594
Other liabilities                             46,175       45,693
Stockholders' equity                          97,179      114,397
                                            --------     --------
Total liabilities and stockholders' equity  $244,481     $273,033
                                            ========     ========
</TABLE>

The accompanying notes are an integral part of these financial
statements.

<PAGE>                         3


   
                       FREEPORT-McMoRan SULPHUR INC.
                   STATEMENTS OF OPERATIONS (Unaudited)
<TABLE>
<CAPTION>
                                   Three Months Ended    Nine Months Ended
                                      September 30,        September 30,
                                   ------------------   ------------------
                                     1998      1997       1998      1997
                                   -------- ---------   -------- ---------
                                   (In Thousands, Except Per Share Amounts)
<S>                                 <C>     <C>         <C>      <C>
Revenues                            $50,869 $  50,554   $164,531 $ 158,304
Cost of sales:
Production and delivery              46,594    40,561    142,626   126,328
Depreciation and amortization         1,147   434,750     13,882   451,639
                                    ------- ---------   -------- ---------
      Total cost of sales            47,741   475,311    156,508   577,967
General and administrative expenses   2,605     1,674      7,979     5,508
                                    ------- ---------   -------- ---------
Total costs and expenses             50,346   476,985    164,487   583,475
                                    ------- ---------   -------- ---------
Operating  income (loss)                523  (426,431)        44  (425,171)
Other income, net                       404       -        1,110       -
                                    ------- ---------   -------- ---------
Net income (loss) 
  before income taxes                   927  (426,431)     1,154  (425,171)

Provision for income taxes             (320)      -         (399)      -
                                    ------- ---------   -------- ---------
Net income (loss)                   $   607 $(426,431)  $    755 $(425,171) 
                                    ======= =========   ======== =========
Net income (loss) per share of common stock:
  Basic                               $0.07   $(41.21)     $0.08   $(41.09)
  Diluted                             $0.06   $(41.21)     $0.08   $(41.09)
Average common shares outstanding:
  Basic                               9,336    10,347      9,746    10,347
  Diluted                             9,367    10,347      9,802    10,347
PRO FORMA DATA  
Net loss before income taxes
  reported above                            $(426,431)           $(425,171)
Pro forma benefit for income taxes            156,049              155,613
                                            ---------            ---------
Pro forma net loss                          $(270,382)           $(269,558)
                                            =========            =========

Pro forma net loss per share                  $(26.13)             $(26.05)
Pro forma average shares outstanding           10,347               10,347
</TABLE>

The accompanying notes are an integral part of these financial statements.

<PAGE>                                4 


                       FREEPORT-McMoRan SULPHUR INC.
                    STATEMENTS OF CASH FLOW (Unaudited)
<TABLE>
<CAPTION>
                                                  Nine Months
                                              Ended September 30, 
                                             --------------------         
                                              1998        1997   
                                             -------    ---------
                                                  (In Thousands)
<S>                                          <C>        <C>
Cash flow from operating activities:
Net income (loss)                            $   755    $(425,171)
Adjustments to reconcile net income 
  (loss) to net cash provided by
  operating activities:
  Depreciation and amortization               13,882      451,639
  Curtailment gain on Culberson pension and
    postretirement liabilities                (4,148)       -    
  Reclamation and mine shutdown expenditures  (6,801)     (15,188)
  Utilization of deferred tax asset              399        -    
  Other                                       (3,434)      (2,266)
  (Increase) decrease in working capital:
    Accounts receivable                       12,871       14,671
    Inventories                               16,413       (3,262)
    Prepaid expenses and other                (1,126)        (111)
    Accounts payable and accrued liabilities    (260)         522
                                             -------    ---------
Net cash provided by operating activities     28,551       20,834
                                             -------    ---------
Cash flow from investing activities:
Capital expenditures                          (5,730)      (2,989)
Sale of assets                                   233          890
                                             -------    ---------
Net cash used in investing activities         (5,497)      (2,099)
                                             -------    ---------
Cash flow from financing activities:
Net distributions to PLP                       -          (19,279)
Purchase of FSC common stock                 (18,271)       -    
Other                                             36        - 
                                             -------    ---------   
Net cash used in financing activities        (18,235)     (19,279)
Net increase (decrease) in cash and 
  cash equivalents                             4,819         (544)
Cash and cash equivalents at
  beginning of year                           21,293        3,116
                                             -------    ---------
Cash and cash equivalents at end of period   $26,112    $   2,572
                                             =======    =========
</TABLE>

The accompanying notes are an integral part of these financial
statements.

<PAGE>                              5



                  FREEPORT-McMoRan SULPHUR INC.
                  NOTES TO FINANCIAL STATEMENTS

1.  BACKGROUND AND BASIS OF PRESENTATION
Background.    Freeport-McMoRan  Sulphur  Inc.  (FSC)  became  an
independent, publicly held company as of December 22, 1997,  when
Phosphate Resource Partners  Limited Partnership (PLP),  formerly
Freeport-McMoRan   Resource   Partners,   Limited    Partnership,
contributed to  FSC  its  sulphur business,  including  its  58.3
percent interest  in its  Main Pass  sulphur and  oil  operations
(Main Pass), together with the 25.0 percent interest in Main Pass
previously owned  by  IMC  Global Inc.  (IGL),  a  joint  venture
partner with PLP. PLP distributed 10,346,578 shares of FSC common
stock  pro  rata  to   its  unitholders  (the  Distribution)   in
connection with the  merger of Freeport-McMoRan  Inc. (FTX),  the
former administrative managing general partner and majority owner
of PLP, into IGL (the Merger).  FTX distributed the shares of FSC
common stock that it received from  PLP to FTX stockholders on  a
pro rata basis in connection with the Merger.

Basis of Presentation.  FSC operated  as an integral part of  PLP
prior  to  the   Distribution.     For  periods   prior  to   the
Distribution, FSC's financial statements  were prepared from  the
books and records of PLP. FSC's investment in the Main Pass joint
venture is reflected using the proportionate consolidation method
in accordance  with  standard  industry practice.    No  interest
expense was allocated to FSC as  no interest costs were  incurred
in the past  by FSC and  no debt previously  recorded by PLP  was
assumed by FSC. Intercompany balances between PLP and FSC related
to various general and  administrative and similar charges  which
were  settled  monthly.    PLP  is  not  a  taxable  entity   and
historically did  not  provide income  taxes  on the  results  of
operations of  FSC.   Upon formation  of FSC  as a  wholly  owned
taxable  subsidiary  of  PLP  prior  to  being  spun-off  to  PLP
unitholders, a deferred tax asset of $63.8 million was recognized
in 1997  to reflect  the excess  of tax  over book  basis in  the
related assets.  Unaudited pro forma income taxes for the  third-
quarter and  nine-month  periods  of 1997  are  included  in  the
statements of operations as if FSC were a separate taxable entity
during those periods.

2.  MERGER WITH McMoRan OIL & GAS CO.
On August 3, 1998, McMoRan Oil & Gas Co. (MOXY) and FSC announced
that they  had signed  a definitive  agreement to  combine  their
operations.  In the proposed transaction, a new holding  company,
McMoRan Exploration  Co.  (MMR), would  issue  approximately  5.5
million MMR common  shares in exchange  for all  of FSC's  common
shares  and  approximately  8.6  million  MMR  common  shares  in
exchange for all of MOXY's common shares.  FSC shareholders would
receive 0.625 MMR shares for each common share of FSC outstanding
and MOXY  shareholders would  receive 0.20  MMR shares  for  each
common share  of MOXY  outstanding.   Immediately  following  the
transaction, MMR  would have  approximately 14.1  million  common
shares outstanding that would  be owned approximately 61  percent
by MOXY's  existing  common  shareholders  and  approximately  39
percent by  FSC's existing  common shareholders.  MMR's Board  of 
Directors and executive management  will include current  members
of the Board of Directors and  executive management of both  MOXY
and FSC.  The transaction would be tax-free with respect to  both
MOXY and FSC shareholders  and will be reported  on the basis  of
purchase accounting, reflecting  MOXY as the  acquiring entity.  
The completion of the transaction is subject to approval by  MOXY
and FSC  shareholders of  record on  October 2,  1998 at  special
shareholder meetings scheduled for November 17, 1998.

3.  EARNINGS PER SHARE
FSC adopted Statement of  Financial Accounting Standards No.  128
(SFAS 128), "Earnings Per Share," in  the fourth quarter of  1997
and has restated prior periods' earnings per share (EPS) data  as
required by SFAS 128.  Basic net income per share of common stock
for the  1998  periods  was calculated  by  dividing  net  income
applicable to  common stock  by  the weighted-average  number  of
common shares outstanding during the periods. Diluted net  income
per share of common stock was  calculated by dividing net  income
applicable to  common stock  by  the weighted-average  number  of
common shares outstanding during the  period plus the net  effect
of dilutive  stock options.  Dilutive stock  options  represented
approximately 31,000  shares in  the third  quarter of  1998  and
approximately 56,000 shares in the nine-month 1998 period.

    Options to purchase approximately 608,400 shares and  221,000
shares of common stock at average  exercise prices of $12.10  per
share and $13.13 per share, respectively, were outstanding during
the third-quarter and nine-month  periods of 1998,  respectively,
but were not included  in the computation  of diluted net  income
per share of  common stock. These  options were excluded  because
their exercise prices were greater than the average market  price
of the common stock during the respective periods.

<PAGE>                         6

    Basic and diluted  net income per share  of common stock  for
the 1997 periods were calculated by  dividing net income for  the
applicable period by the number of shares distributed on December
22, 1997 (10,346,578  shares).   FSC had  no options  outstanding
prior to December 23, 1997.

4.  FINANCIAL CONTRACTS
FSC has entered into financial contracts to manage certain  risks
resulting from fluctuations  in the price  of natural gas,  which
comprises a  significant  portion  of its  production  costs,  by
creating offsetting exposures.   FSC views  all of its  financial
contracts as  hedges  for its  future  purchases of  natural  gas
consumed in its operations.  Gains or losses on the contracts are
recognized with the  hedged transaction.   Also, gains or  losses
are recognized if the hedged transaction is no longer expected to
occur or if  deferral criteria  are not  met.   FSC monitors  its
credit risk on  an ongoing basis  and considers this  risk to  be
minimal because  its  contracts  are with  a  financially  strong
counterparty.

    In  June  1998,  the  Financial  Accounting  Standards  Board
issued SFAS  133,  "Accounting  for  Derivative  Instruments  and
Hedging Activity,"  which  establishes accounting  and  reporting
standards requiring that every derivative instrument be  recorded
in the balance sheet as either an asset or liability measured  at
its  fair  value.   SFAS  133  requires   that  changes  in   the
derivative's fair  value  be  recognized  currently  in  earnings
unless specific hedge  accounting criteria are  met. SFAS 133  is
effective for fiscal  years beginning  after June  15, 1999  with
earlier application permitted.   FSC is  currently assessing  the
impact that  adoption  of SFAS  133  would have  on  its  current
accounting for  its  financial  contracts  and  other  derivative
instruments, and has not yet determined  the timing or method  of
adoption of SFAS 133.


                     ----------------------

                             Remarks

The information furnished  herein should be  read in  conjunction
with FSC's  financial statements  contained  in its  1997  Annual
Report on Form 10-K.   The information furnished herein  reflects
all  adjustments  which  are,  in  the  opinion  of   management,
necessary for a fair statement of  the results for the periods.  
All such  adjustments are,  in the  opinion of  management, of  a
normal recurring nature. 


<PAGE>                           7




            REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS


To The Board of Directors and Stockholders of
Freeport-McMoRan Sulphur Inc.:


    We have reviewed the accompanying condensed balance sheet  of
Freeport-McMoRan Sulphur  Inc.  (a Delaware  corporation)  as  of
September 30, 1998,  and the related statements of operations for
the three and  nine-month periods  ended September  30, 1998  and
1997, and the statements of cash flow for the nine-month  periods
ended September 30,  1998 and 1997  for Freeport-McMoRan  Sulphur
Inc. and its  predecessor.   These financial  statements are  the
responsibility of the Company's management.

    We  conducted  our  review   in  accordance  with   standards
established  by  the  American  Institute  of  Certified   Public
Accountants.  A review of interim financial information  consists
principally of applying analytical  procedures to financial  data
and making  inquiries of  persons responsible  for financial  and
accounting matters.  It  is substantially less  in scope than  an
audit conducted in  accordance with  generally accepted  auditing
standards, the objective of which is the expression of an opinion
regarding  the   financial  statements   taken  as   a  whole.   
Accordingly, we do not express such an opinion.

    Based on  our  review,  we are  not  aware  of  any  material
modifications that  should be  made to  the financial  statements
referred to above  for them to  be in  conformity with  generally
accepted accounting principles.

    We have  previously  audited, in  accordance  with  generally
accepted auditing  standards,  the  balance  sheet  of  Freeport-
McMoRan Sulphur Inc.  as of December  31, 1997,  and the  related
statements of operations, stockholders' equity and cash flow  for
the year then ended  (not presented herein),  and, in our  report
dated January 20,  1998, we expressed  an unqualified opinion  on
those financial statements. In our opinion, the  information  set 
forth in the accompanying condensed balance sheet as of  December
31, 1997, is fairly stated, in all material respects, in relation
to the balance sheet from which it has been derived.


                                     ARTHUR ANDERSEN LLP


New Orleans, Louisiana
October 20, 1998

<PAGE>                          8


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

OVERVIEW
As discussed  in  Note  1, Freeport-McMoRan  Sulphur  Inc.  (FSC)
became an independent, publicly held  company as of December  22,
1997 and  prior to  that date  operated as  an integral  part  of
Phosphate Resource  Partners Limited  Partnership (PLP).    FSC's
1998 financial  results  reflect  the operating  results  of  the
assets previously owned by PLP and  the 25.0 percent interest  in
the Main Pass sulphur and oil joint venture (Main Pass)  acquired
from IMC Global Inc. (IGL).  FSC's 1997 financial results reflect
only the operating results of the assets previously owned by PLP.

     FSC's sulphur business consists of the sale of sulphur,  the
marketing of logistics services, and  the operation of a  sulphur
mine and a logistics system consisting of sulphur  transportation
and terminaling  assets.   FSC's sulphur  operations include  the
Main Pass mine located offshore Louisiana in the Gulf of  Mexico,
five sulphur terminals located across the Gulf Coast, and  marine
and rail transportation  assets.  The  oil operations consist  of
FSC's interest in the  Main Pass operations,  where crude oil  is
produced in conjunction with FSC's sulphur mining operations.

     On  June  30,  1998,  FSC  announced  plans  to  permanently
discontinue sulphur  production  at its  Culberson  sulphur  mine
because sulphur prices had fallen to  a level at which it was  no
longer economically feasible to operate the  mine.  As a  result,
FSC recorded net charges totaling  $6.0 million ($3.9 million  to
net income or  $0.40 per share)  in the second  quarter of  1998,
including charges of $9.5 million ($6.2 million to net income) to
depreciation and  amortization expense  for  a writedown  of  the
Culberson mine  assets  and $0.6  million  ($0.4 million  to  net
income) to  production  costs for  other  closure-related  costs,
partially offset by a $4.1 million  benefit ($2.7 million to  net
income) to production  costs for a  related reduction in  pension
and postretirement benefit liabilities.

RECENT DEVELOPMENTS
Sulphur production at Main Pass averaged 3,800 long tons per  day
and 4,200 long tons per day for the three and nine-month  periods
ended September 30, 1998, respectively, compared with 5,200  long
tons per day for the year ended December 31, 1997.  In an  effort
to replace sulphur  production because of  poor well  performance
and wells lost  as a result  of Hurricane  Georges, as  discussed
below,  and  restore  production  to  optimum  levels  given  the
curtailment at  the Culberson  mine, FSC  has increased  drilling
activities during 1998 and plans to continue efforts to  increase
Main Pass production in 1999.

     In late September 1998, FSC shut down all Main Pass drilling
and production  operations  in accordance  with  standard  safety
procedures in response to significant adverse weather  conditions
caused by Hurricane Georges.  After three days of  shutdown,  FSC 
restarted production, which involved re-heating  the  portion  of 
the sulphur  deposit  being produced prior to the shutdown.  Nine 
previously  producing sulphur wells will require re-drilling.  As 
a  result,  production levels will decrease and  unit  production 
costs will increase  for the fourth quarter of  1998 and possibly 
the  first half of  1999 compared with  the first nine months  of 
1998.   At the end of October 1998  Main Pass  production totaled  
approximately  2,400 long tons per day.

     In addition to its two sulphur  drilling rigs at Main  Pass,
FSC has contracted  a third-party  drilling rig  to help  restore
production to optimum levels.  In  the interim,  FSC  will   meet   
customer  requirements   from  available   Main  Pass production,   
inventories,   increased   purchases   of recovered  sulphur  and 
extending  production  of  the  Culberson mine  until  its  final 
shutdown.   In response to  a weak  sulphur market, FSC curtailed 
production at its Culberson mine in early 1998 and  announced  on  
June  30,  1998  that  it planned to permanently cease operations 
at the mine during the third quarter of 1998. However, as a result 
of  decreased production at Main Pass, FSC now expects to operate 
Culberson at reduced rates through at least the fourth quarter of 
1998.

     FSC has been seeking an increase in sulphur contract  prices
compared with market prices in the first nine months of 1998, and
contract prices  have  generally  settled  at  a  $3.00  per  ton
increase for  the  fourth  quarter of  1998.    Approximately  50
percent of FSC's fourth-quarter  sulphur sales will benefit  from
the price  increase, with  full benefit  for the  price  increase
expected to be realized in the first quarter of 1999.

     In August  1998,  FSC  and McMoRan  Oil  &  Gas  Co.  (MOXY)
announced that they had signed a definitive agreement to  combine
their operations.   For  further discussion  see  Note 2  to  the
financial statements.

<PAGE>                       9

     In 1973, the  United States government  made a finding under 
the  U.S. Antidumping  Act of  1921 (the  "Antidumping Act") that 
certain Canadian  producers  of  elemental  sulphur were  dumping  
sulphur   into  the   U.S.  sulphur  market  in violation of  the  
Antidumping   Act  and  imposed   certain  limitations  on  those 
producers.  In  the  intervening  period,  many  of  the Canadian 
producers that were originally subject to this finding established 
that they were no longer  selling  sulphur  in  violation of  the 
Antidumping  Act and  had  the application of the finding revoked 
as  to them.   Under  a recent change  in  law,  all  antidumping 
findings (including the 1973 finding) are now subject to a regular  
five-year "sunset review." The U.S. International Trade Commission
(the "ITC") is  currently  reviewing  the 1973  finding  and,  on 
November 5, 1998, voted to  expedite  its  review, which  will be 
completed by the end of  1998, unless extended.  FSC has filed an  
opposition  to  revocation  of  the  1973  finding, detailing the  
potential adverse  impact that  FSC  believes would result if the 
finding were revoked. If the ITC were to revoke the 1973 finding,  
which  FSC does  not  expect, Canadian sulphur exporters could be 
subjected  to a  future finding and imposition of penalties under 
the Antidumping Act if they resumed dumping sulphur into the U.S.  
market.  No assurance can be given, however, as to the outcome of 
the current or any future ITC proceeding.

RESULTS OF OPERATIONS
Summary comparative results for the third-quarter and  nine-month
periods   follow   (dollar    amounts   in   thousands,    except
realizations):
<TABLE>
<CAPTION>
                               Third Quarter            Nine Months       
                            -------------------   ----------------------
                             1998      1997(a)      1998        1997(a) 
                            -------   ---------   ---------    ---------
<S>                         <C>       <C>         <C>          <C> 
Revenues:
  Sulphur                   $47,371     $43,906   $ 149,051    $ 135,328
  Oil                         3,498       6,648      15,480       22,976
                            -------     -------   ---------    ---------
    Total revenues          $50,869     $50,554   $ 164,531    $ 158,304
                            =======     =======   =========    =========
Operating income (loss):
  Sulphur                    $ (340)  $(426,187)b $  (6,296)c  $(429,152)b
  Oil                           863        (244)      6,340        3,981
                             ------   ---------   ---------    ---------
    Total operating income 
     (loss)                  $  523   $(426,431)  $      44    $(425,171)
                             ======   =========   =========    =========

Sulphur sales (long tons)   782,000     690,100   2,460,000    2,167,000
Sulphur average realized 
 price per long ton          $59.92      $61.75      $59.96       $60.75
Oil sales (barrels)         315,100     380,100   1,222,700    1,247,600
Oil average realized 
 price per barrel            $11.04      $17.44      $12.40       $18.37
</TABLE>

a. Results for 1997 represent the operating results of the assets
   previously  owned  by  PLP that  were  transferred  to  FSC  on
   December  22, 1997.   These  results do  not include  the  25.0
   percent interest in Main Pass previously owned by IGL prior  to
   December 22, 1997 when it was contributed to FSC.
b. Includes charges  totaling $425.4  million for  impairment  of
   sulphur assets.
c. Includes net charges totaling  $6.0 million for the  Culberson
   mine shutdown.

Sulphur.  Sulphur  operations reported operating  losses of  $0.3
million in the  third quarter  of 1998  and $6.3  million in  the
nine-month 1998 period compared  with operating losses of  $426.2
million for  the 1997  quarter and  $429.2 million  for the  1997
nine-month period.    The  1998 nine-month  period  includes  net
charges of  $6.0 million  for  the Culberson  shutdown  discussed
above and  the  1997  periods  include  charges  totaling  $425.4
million for impairment of sulphur assets.

     Average realized sulphur  prices for the  1998 periods  were
lower than the  1997 periods,  while sulphur  sales volumes  rose
because of FSC's additional  25.0 percent interest acquired  from
IGL and  an increase  in  recovered sulphur  purchases  partially
offset by lower  production at  the Culberson  mine.   FSC has  a
long-term  supply  contract  with  IMC-Agrico  Company  (a  joint
venture partnership between IGL and  PLP), which extends as  long
as  IMC-Agrico  Company's  operations  have  a  requirement   for
sulphur.  As a  percentage of total FSC  sulphur sales, sales  to
IMC-Agrico Company totaled  72 percent  in the  1998 periods,  68 
percent in the  1997 third  quarter and  64 percent  in the  1997
nine-month period. 

     Overall average sulphur unit  production costs, excluding  a
$3.5 million net benefit in the second quarter of 1998 related to
the Culberson shutdown, were higher in the 1998 periods primarily
because of lower  production and  higher drilling  costs at  Main
Pass caused by poor well performance and Hurricane Georges in the
Gulf of Mexico. Depreciation and amortization expense in the 1998
nine-month  period  includes  $9.5  million  to  write  off   the
Culberson mine assets, while the 1997 periods include charges for

<PAGE>                         10

impairment of  sulphur  assets.    Unit  depreciation  rates  are
significantly lower  in  1998 following  the  third-quarter  1997
impairment.  Excluding the write off of Culberson assets and  the
impairment,  depreciation  and  amortization  expense  was   $4.9
million lower  in the  third quarter  of 1998  compared with  the
third quarter of 1997 and $13.6  million lower in the first  nine
months of 1998 compared with the 1997 period. 

     In April  1998,  FSC  entered  into  contracts  to  purchase
450,000 million british  thermal units (mmbtu's)  of natural  gas
per month (approximately 75 percent  of FSC's expected Main  Pass
natural gas  purchases) for  $2.175  per mmbtu  through  December
1998.  Pursuant to the terms  of the contracts, the supplier  has
the option to put 450,000 mmbtu's per month to FSC at a price  of
$2.175 per mmbtu  during 1999. As  of September  30, 1998,  these
contracts had a fair value of approximately $0.1 million. 

Oil.   Main  Pass operating  income  (loss) from  oil  operations
totaled $0.9  million  in the  third  quarter of  1998  and  $6.3
million for  the nine-month  1998  period, compared  with  $(0.2)
million in the  third quarter  of 1997  and $4.0  million in  the
nine-month 1997 period. Lower sales  volumes in the 1998  periods
reflect a  natural  production  decline, the  effects  of  recent
storms in the Gulf of Mexico and the new royalty discussed below,
partially  offset  by  FSC's  additional  25.0  percent  interest
acquired from IGL.  Gross oil production  averaged 6,000  barrels
per day in the third quarter of 1998 and 8,500 barrels per day in
the third quarter of 1997. A 37 percent decline in  third-quarter
1998 average realized prices compared with third-quarter 1997 and
a 32 percent  decline in average  realized prices  for the  nine-
month 1998 period compared with the 1997 period were the  primary
reasons for 47 percent and 33 percent declines, respectively,  in
1998 revenues compared with the year-ago periods.  Quarterly  oil
sales volumes are expected to continue to decline as the reserves
continue to deplete over a period expected to extend through  the
year  2002.  FSC's  share  of  1998  oil  sales  is  expected  to
approximate 1.6 million  barrels, consistent  with 1997.  Revised
unit depreciation  rates  in  1998 resulted  in  a  $3.3  million
decrease in third-quarter 1998 depreciation expense compared with
the 1997 quarter and an $8.2 million decrease in nine-month  1998
depreciation expense compared with the 1997 nine-month period. 

     The original oil and gas lease holder of the oil reserves at
Main Pass owns a  royalty equal to 25  percent of revenues  (less
transportation costs) from oil production, limited to 50  percent
of net operating revenue,  after 36 million  barrels of oil  have
been produced at Main Pass.   FSC exceeded 36 million barrels  of
cumulative oil production in June 1998  and, as a result, is  now
required to pay  royalties to the  original lease  holder at  the
rate of 50 percent  of net operating revenue  from Main Pass  oil
production. 

     General and administrative expenses were higher in the  1998
periods compared with the 1997 periods primarily because of FSC's
increased interest  in Main  Pass  and certain  employee  benefit
costs.

CAPITAL RESOURCES AND LIQUIDITY
Net cash provided by  operating activities totaled $28.6  million
for the first nine  months of 1998,  compared with $20.8  million
for the  first nine  months  of 1997.    A reduction  in  sulphur
inventories and lower reclamation and mine shutdown  expenditures
in 1998 were the primary reasons for higher net cash provided  by
operating activities in  the 1998 period  compared with the  1997
period.

     Capital expenditures, which primarily relate to  maintaining
current levels of production, totaled $5.7 million for the  nine-
month 1998  period  and  $3.0 million  for  the  nine-month  1997
period.  Capital expenditures for the fourth quarter of 1998  are
expected to  total  approximately  $5.5  million,  primarily  for
additional drilling activities to  replace those wells no  longer
producing after Hurricane Georges.

     As part of its  open market share  purchase program, in  the
third quarter of 1998 FSC purchased 953,900 shares of its  common
stock for $9.4  million, an average  of $9.88 per  share.  As  of
September 10,  1998,  FSC had  completed  its open  market  share
purchase program acquiring 1.6 million shares of its common stock
for $18.3 million, an average of $11.42 per share. 

     Based on current projections,  management believes that  FSC
will generate sufficient  cash flow from  operations to fund  its
ongoing  working  capital  requirements,  reclamation  costs  and
projected  capital  expenditures  for  the   foreseeable  future. 
Additionally, in  December 1997  FSC established  a $100  million
revolving credit facility  to further enhance  its liquidity  and
financial flexibility.   No amounts were  outstanding under  this
facility as of October 19, 1998.  FSC's proposed merger with MOXY
will not  have  any  impact  on  FSC's  availability  under  this
facility.   As of  September 30,  1998,  FSC held  cash  balances
totaling $26.1  million  which  are  available  to  fund  working
capital  requirements,  reclamation   costs,  projected   capital
expenditures and other growth  opportunities that FSC may  pursue
in the future.

<PAGE>                         11

IMPACT OF YEAR 2000 COMPLIANCE
The Year 2000 (Y2K) issue is  the result of computerized  systems
being written  to store  and process  the year  portion of  dates
using two digits rather than four. Date-aware systems (i.e.,  any
system or  component  that  performs  calculations,  comparisons,
sequencing, or  other operations  involving  dates) may  fail  or
produce erroneous results  on or before  January 1, 2000  because
the year 2000 will be interpreted as the year 1900.


FSC's State of  Readiness. FSC  has been pursuing  a strategy  to
ensure  all  its  significant   computer  systems  and   computer
controlled plant and equipment will be able to process dates from
and after January 1, 2000, including leap years, without critical
systems failure (Y2K Compliance  or Y2K Compliant).  Computerized
systems are integral to the  operations of FSC, particularly  for
plant  and  equipment  process  control at  the  Main Pass  mine.  
Certain computerized business  systems and  related services  are
provided by FM Services Company  (FMS), which is responsible  for
ensuring Y2K  Compliance for  the systems  it manages.   FMS  has
separately prepared a plan for its  Y2K Compliance.  Progress  of
the Y2K plan is being monitored  by FSC executive management  and
reported to the Audit Committee of the FSC Board of Directors. In
addition, the independent  accounting firm  functioning as  FSC's
internal auditors  is  assisting  management  in  monitoring  the
progress of the Y2K plan.   FSC believes all critical  components
of the plan  are on  schedule for completion  by the  end of  the
second quarter of 1999.

     The majority  of  computerized date-sensitive  hardware  and
software components used by FSC or FMS are covered by maintenance
contracts  with  the  vendors  who  originally implemented  them.  
Almost all of these vendors have already been contacted regarding
Y2K Compliance  of their  products.   Where  necessary,  software
modifications to  ensure  compliance  will  be  provided  by  the
appropriate vendors under their maintenance contracts.

Information Technology (IT)  Systems - The  bulk of FSC  business
systems  have  been   determined  to  be   Y2K  Compliant,   with
modification and testing  work completed  earlier in  1998.   The
major remaining  FSC  system  that is  currently  not  fully  Y2K
Compliant is its accounting system.  By the end of 1998, FMS will
install, for an affiliated entity, a Y2K Compliant version of the
same accounting  system  used  by  FSC.    This  will  allow  any
installation issues  to  be  identified and  rectified  prior  to
installation of this system at FSC in the second quarter of 1999.
FMS also provides payroll  and cash disbursements processing  for
FSC.   FMS  has  implemented  the  Y2K  version  of  the  payroll
interface software  and will  conduct Y2K  Compliance testing  of
third party-provided payroll  services in early  1999.  FMS  will
also conduct Y2K testing  of the interfaces  to its primary  bank 
and bank-provided  computerized  disbursement services  in  early
1999 after the  bank has  completed its  internal Y2K  Compliance
work.

Non-IT Systems - With the exception  of the Main Pass  production
facilities, FSC is  not heavily reliant  on computerized  process
control systems.    FSC has  contracted  with a  third  party  to
conduct a Y2K Compliance review for the Main Pass process control
system.  This  work will be  completed in the  fourth quarter  of
1998.  Based on the company's  own internal review, FSC does  not
believe that any significant problems will be detected.  However,
the results  of this third-party review will be used to determine
the need,  if any,  for  subsequent efforts to address compliance
problems.

Third Party Risks    -  FSC  computer  systems   are  not  widely
integrated with the systems of its  suppliers or customers.   The
primary potential Y2K risk attributable to third parties would be
from a  disruption  of FSC  operations  due  to a  failure  by  a
supplier to meet its contractual obligations for services  and/or
materials (rather  than  a  failure  associated  with  integrated
computer  systems).    Every  FSC  supplier  has  been  contacted
regarding Y2K  Compliance,  and  effective August  1,  1998,  Y2K
Compliance requirements have been included in all FSC  purchasing
contracts.  An  assessment of Y2K  third-party risk is  scheduled
for  completion  in  the  fourth  quarter  of  1998.    Based  on
preliminary work performed to date, FSC does not believe  overall
risk from third parties is significant.

The Costs to  Address  FSC's  Y2K Issues.    Expenditures for the
necessary  modifications  required  during  1998  and  1999  will
largely be funded  by routine software  and hardware  maintenance
fees paid by FSC or FMS to the related software providers.  Based
on current  information,  FSC  believes  that  the  cost  of  Y2K
Compliance will not be material and will be provided for  through
its  normal  operating  and  capital  budgets.  If  the  software
modifications and conversions referred to above are not made,  or
are delayed, the Y2K  issue could have a  material impact on  FSC
operations.  Additionally,  current cost estimates  are based  on
management's best  estimates, which  are derived  using  numerous
assumptions of future events including 

<PAGE>                           12

the continued availability  of  certain  resources,  third  party 
modification  plans and  other factors.  There  also  can  be  no 
assurance that the systems of other companies will  be  converted 
on a timely basis or that failure  to convert  will  not  have  a 
material adverse effect on FSC.

The Risks of FSC's Y2K Issues.  The Y2K risk that could have  the
largest potential  business impact  on FSC  would probably  be  a
short-term  shutdown  of  Main   Pass  operations  caused  by   a
disruption of key  materials from  suppliers, especially  natural
gas. FSC is addressing this potential  risk with its natural  gas
supplier and pipeline  company and expects  to have a  definitive
assessment of this risk in the fourth quarter of 1998.

FSC's Contingency Plans.  Companies, including  FSC, cannot  make
Y2K  Compliance  certifications  because   the  ability  of   any
organization's systems  to  operate reliably  after  midnight  on
December 31, 1999 is dependent upon  factors that may be  outside
the  control of, or unknown to,  the organization.  In Securities
and Exchange Commission (SEC) Staff Legal Bulletin No. 5, the SEC
stated that "it is not, and will not, be possible for any  single
entity or collective enterprise to represent that it has achieved
complete  Year  2000  Compliance   and  thus  to  guarantee   its
remediation efforts.  The problem is simply too complex for  such
a claim to have legitimacy.  Efforts to solve Year 2000  problems
are best described as 'risk mitigation'."

     Although FSC believes the  likelihood of any  or all of  the
above risks occurring to be  low, specific contingency plans  are
being developed to address certain risk areas.  The schedule  for
contingency plan development has  a projected completion date  of
March 1999.  While there can  be no assurances that FSC will  not
be materially adversely affected by Y2K problems, it is committed
to ensuring that  it is fully  Y2K ready and  believes its  plans
adequately address the above-mentioned risks. 

CAUTIONARY STATEMENT
Management's discussion and analysis  of financial condition  and
results  of  operations   contains  forward-looking   statements,
including  without   limitation,  FSC's   reserve   expectations,
operating costs, the availability  of financing, Y2K  Compliance,
the ability to satisfy future cash obligations and  environmental
costs.  Important factors that may cause future results to differ
from these projections include the reliance on IMC-Agrico Company
as a  continuing  customer,  the seasonality  and  volatility  of
sulphur  markets,   competition  and   environmental  issues   as
described  in   more  detail   under  the   heading   "Cautionary
Statements" in FSC's  Form 10-K  for  the year ended December 31, 
1997.

                     --------------------
The results of operations reported  and summarized above are  not
necessarily indicative of future operating results.

<PAGE>                         13



PART II.   OTHER INFORMATION


Item 1.  Legal Proceedings.

Daniel W. Krasner  vs. James R. Moffett; Rene L. Latiolais;  C.
Donald Whitmire, Jr.;  J. Terrell  Brown; Thomas D. Clark,  Jr.;
B.M. Rankin,  Jr.;  Richard  C. Adkerson;  Robert  M.  Wohleber;
Freeport-McMoRan Sulphur Inc. and McMoRan  Oil &  Gas Co.,  Civ.
Act. No. 16729-NC (Del. Ch. Filed Oct. 22, 1998).

On October  22, 1998,  one  Freeport-McMoRan Sulphur  Inc.  (FSC)
stockholder filed a  purported class action  lawsuit in  Delaware
alleging that FSC's  directors breached their  fiduciary duty  to
FSC stockholders by signing the  agreement to merge with  McMoRan
Oil & Gas Co. ("MOXY").   The plaintiff contends that the  merger
transaction is structured to give preference to MOXY stockholders
and fails to  recognize the  true value  of FSC.   The  plaintiff
claims that the  directors failed  to take  certain actions  that
were necessary to obtain the true value of FSC such as auctioning
the company to the highest bidder or evaluating FSC's worth as  a
merger candidate.  The plaintiff also claims that MOXY  knowingly
aided and abetted the breaches of fiduciary duty committed by the
other defendants.   The  plaintiff  seeks injunctive  relief  and
monetary damages.  FSC intends to vigorously defend this action.

Item 6.   Exhibits and Reports on Form 8-K.

          (a)  The exhibits  to this  report  are listed  in  the
               Exhibit Index beginning on Page E-1 hereof.
          (b)  During the quarter for which this report is filed,
               the registrant filed one Current Report on Form 8-
               K dated August 3, 1998 reporting information under
               Item 5.

<PAGE>                            14


                             SIGNATURE


    Pursuant to the requirements  of the Securities Exchange  Act
of 1934, the registrant has duly caused this report to be  signed
on its behalf by the undersigned hereunto duly authorized.


                         FREEPORT-McMoRan SULPHUR INC.


                         By:/s/ C. Donald Whitmire, Jr.
                              -----------------------------
                                 C. Donald Whitmire, Jr.
                             Vice President and
                             Controller-Financial Reporting
                             (authorized signatory and
                             Principal Accounting Officer)

Date:  November 12, 1998

<PAGE>                          15




                         Freeport-McMoRan Sulphur Inc.
                               EXHIBIT INDEX
 


Number                        Description
------  ----------------------------------------------------------
  2.1   Contribution  and  Distribution  Agreement  by  and  among
        Freeport-McMoRan Sulphur  Inc. (the   Company),  Freeport-
        McMoRan Inc. (FTX) and Freeport-McMoRan Resource Partners,
        Limited Partnership (FRP), dated as of  August 26, 1997(1)

  2.2   Assignment  and Assumption  Agreement by  and between  IMC
        Global Inc. (IGL) and FRP dated as of December 22, 1997(2)

  3.1   Certificate of Incorporation of the Company(1)

  3.2   By-laws of the Company(1)

  4.1   Form of the Company's Common Stock certificate(1)

  4.2   Stockholder Protection Rights Agreement between the Company
        and Mellon Securities Trust Company, as Rights Agent(3)

  4.3   Amendment No.  1 dated August 1,  1998 to the  Stockholder
        Protection Rights Agreement dated as of December 17,  1998
        between the Company and  Mellon Securities Trust  Company,
        as Rights Agent.

  10.1  Employee Benefits  Agreement by  and between  FTX and  the
        Company(2)

  10.2  Asset Sale Agreement for Main Pass Block 299 between  FRP
        and Chevron USA, Inc. dated as of May 2, 1990(1)

  10.3  Main Pass  299 Sulphur and  Salt Lease,  effective May  1,
        1988(1)

  10.4  Joint  Operating  Agreement  by  and  between  FRP,  IMC-
        Fertilizer, Inc. and  Felmont Oil      Corporation,  dated
        June 5, 1990(1)

  10.5  Joint  Operating  Agreement  by  and  between  FRP,  IMC-
        Fertilizer, Inc. and Felmont  Oil  Corporation, dated  May
        1, 1988(1)

  10.6  Agreement  to  Coordinate  Operating  Agreements  by  and
        between FRP, IMC-Fertilizer and   Felmont Oil Corporation,
        dated May 1, 1988(1)

  10.7  Asset Purchase Agreement between FRP and Pennzoil  Company
        dated  as  of  October   22,  1994  (the  Asset   Purchase
        Agreement)(1)

  10.8  Amendment No. 1 to the  Asset Purchase Agreement dated  as
        of January 3, 1995(1) 

  10.9  Agreement for Sulphur Supply, as amended, dated as of July
        1, 1993 among  FRP, IMC  Fertilizerand IMC-Agrico  Company
        (the Sulphur Supply Agreement)(1)(4)

  10.10 Side  letter  with  IGL   regarding  the  Sulphur   Supply
        Agreement(1)

  10.11 Processing and Marketing Agreement  between the Freeport  
        Sulphur Company (a  division of     FRP)  and Felmont  Oil
        Corporation  dated   June   19,   1990   (the   Processing
        Agreement)(1)

  10.12 Amendment Number 1 to the Processing Agreement(1)

  10.13 Amendment Number 2 to the Processing Agreement(1)

<PAGE>                     E-1

  10.14 Services Agreement dated as  of December 23, 1997  between
        the Company and FM Services Company (FMS)(2)

  10.15 Credit Agreement dated as of  December 12, 1997 among  the
        Company, as  borrower,  the financial  institutions  party
        thereto, the Chase Manhattan Bank, as administrative agent
        and documentary agent, and Hibernia National Bank, as  co-
        agent(2)

Executive Compensation Plans and Arrangements (Exhibits  10.16
        through 10.19)

  10.16 1997 Stock Option Plan for Non-Employee Directors(1)

  10.17 Company Adjusted Stock Award Plan(1)


  10.18 Freeport Sulphur 1997 Stock Option Plan(1)

  10.19 Letter Agreement dated December  22, 1997 between FMS  and
        Rene L. Latiolais(2)

  15.1  Letter dated  October 20,  1998 from  Arthur Andersen  LLP
        regarding unaudited interim financial statements.

  27.1  Financial Data Schedule


  ----------------------
  (1)  Incorporated by reference from the Company's Registration
       Statement on Form S-1 (Registration No. 333-40375) filed
       with the Securities and Exchange Commission on November
       17, 1997.
  (2)  Incorporated by reference from the Company's Annual Report
       on Form 10-K for the year ended December 31, 1997.
  (3)  Incorporated by reference from the Company's Current
       Report on Form 8-K dated December 16, 1997.
  (4)  Portions of this Exhibit have been omitted pursuant to a
       confidentiality request filed with the Securities and
       Exchange Commission in connection with the filing of the
       Registration Statement on Form S-1.


<PAGE>                         E-2