Exhibit 10.12


                                McMoRan OIL & GAS CO.
                  1994 STOCK OPTION PLAN FOR NON-EMPLOYEE DIRECTORS


                                      ARTICLE I

                                 PURPOSE OF THE PLAN

                    The  purpose  of  the   1994  Stock  Option  Plan   for
          Non-Employee Directors (the "Plan") is to align more closely  the
          interests of the non-employee directors of McMoRan Oil & Gas  Co.
          (the "Company")    with that  of  the Company's  stockholders  by
          providing for  the automatic  grant to  such directors  of  stock
          options ("Options") to purchase Shares (as hereinafter  defined),
          in accordance with the terms of the Plan.


                                     ARTICLE II

                                     DEFINITIONS

                    For the  purposes of  this  Plan, the  following  terms
          shall have the meanings indicated:

                    Board:  The Board of Directors of the Company.

                    Change in Control:  A Change in Control shall be deemed
          to have occurred  if either (a)  any person, or  any two or  more
          persons acting as a group, and  all affiliates of such person  or
          persons, shall own beneficially more than 20% of the Common Stock
          outstanding (exclusive of shares  held in the Company's  treasury
          or by the  Company's Subsidiaries)  pursuant to  a tender  offer,
          exchange offer or series of  purchases or other acquisitions,  or
          any combination of those  transactions, or (b)  there shall be  a
          change in the  composition of the  Board at any  time within  two
          years  after   any   tender  offer,   exchange   offer,   merger,
          consolidation, sale  of  assets  or contested  election,  or  any
          combination of those transactions (a "Transaction"), so that  (i)
          the persons who were directors of the Company immediately  before
          the first such Transaction cease to constitute a majority of  the
          Board of Directors of the  corporation which shall thereafter  be
          in control of  the companies that  were parties  to or  otherwise
          involved in such Transaction, or (ii)  the number of persons  who
          shall thereafter be directors of such corporation shall be  fewer
          than two-thirds  of  the  number  of  directors  of  the  Company
          immediately prior to such first Transaction.  A Change in Control
          shall be deemed  to take  place upon the  first to  occur of  the
          events specified in the foregoing clauses (a) and (b).

                    Code:  The  Internal Revenue Code  of 1986, as  amended
          from time to time.

                    Committee:  A committee of the Board designated by  the
          Board to administer the Plan and  composed of not fewer than  two
          directors, each of whom, to the  extent necessary to comply  with
          Rule 16b-3 only, is a "non-employee director" within the  meaning
          of Rule 16b-3 and, to the extent necessary to comply with Section
          162(m) only,  is an  "outside director"  under Section  162(m).  
          Until otherwise determined by the  Board, the Committee shall  be
          the Corporate Personnel Committee of the Board.

                    Eligible Director:  A director of  the Company who  is
          not, and within the preceding one  year has not been, an  officer
          or an employee of the Company  or a Subsidiary, an officer or  an
          employee of an entity  with which the  Company has contracted  to
          receive Management Services, or otherwise eligible for  selection
          to participate in any plan of the Company or any Subsidiary  that
          entitles the participants therein to acquire stock, stock options
          or stock appreciation rights of the Company or its Subsidiaries.

                    Exchange Act:  The Securities Exchange Act of 1934,  as
          amended from time to time.

                    Fair Market Value:  The average  of the per Share  high
          and low quoted sale prices on the date in question (or, if  there
          is no reported sale on such  date, on the last preceding date  on
          which any reported  sale occurred) on  the principal exchange  or
          market on which such Shares are quoted.

                    Option  Cancellation  Gain:   With  respect  to   the
          cancellation of an  Option pursuant to  Section 3  of Article  IV
          hereof, the excess  of the  Fair Market  Value as  of the  Option
          Cancellation Date  (as  that term  is  defined in  Section  3  of
          Article IV hereof) of all the outstanding Shares covered by  such
          Option, whether or not then exercisable, over the purchase  price
          of such Shares under such Option.

                    Rule 16b-3:   Rule 16b-3 promulgated  by the SEC  under
          the Exchange Act, or any successor rule or regulation thereto  as
          in effect from time to time.

                    SEC:  The Securities and Exchange Commission, including
          the staff thereof, or any successor thereto.

                    Section 162(m):   Section 162(m)  of the  Code and  all
          regulations promulgated  thereunder as  in  effect from  time  to
          time.

                    Shares:  Shares  of common stock,  par value $0.01  per
          share, of  the Company  (including any  attached Preferred  Stock
          Purchase Rights).

                    Subsidiary:      Any   corporation   of   which   stock
          representing at least 50% of the ordinary voting power is  owned,
          directly or indirectly, by the Company;  and any other entity  of
          which equity securities or interests representing at least 50% of
          the ordinary  voting power  or  50% of  the  total value  of  all
          classes of  equity securities  or interests  of such  entity  are
          owned, directly or indirectly, by the Company.


                                     ARTICLE III

                             ADMINISTRATION OF THE PLAN

                    This Plan  shall be  administered by  the Board.    The
          Board will interpret this  Plan and may from  time to time  adopt
          such rules  and  regulations  for  carrying  out  the  terms  and
          provisions of this Plan as it  may deem best; however, the  Board
          shall have  no  discretion  with  respect  to  the  selection  of
          directors who  receive  Options,  the  timing  of  the  grant  of
          Options, the  number of  Shares subject  to  any Options  or  the
          purchase price  thereof.    Notwithstanding  the  foregoing,  the
          Committee shall  have the  authority to  make all  determinations
          with respect to the transferability of Options in accordance with
          Article VIII  hereof.   All determinations  by the  Board or  the
          Committee shall be made by the affirmative vote of a majority  of
          its respective members, but any determination reduced to  writing
          and signed by a majority of its respective members shall be fully
          as effective as  if it  had been  made by  a majority  vote at  a
          meeting  duly  called  and  held.    Subject  to  any  applicable
          provisions  of  the  Company's  By-Laws  or  of  this  Plan,  all
          determinations by the  Board and  the Committee  pursuant to  the
          provisions of this Plan, and all related orders or resolutions of
          the Board  and  the Committee,  shall  be final,  conclusive  and
          binding  on   all  persons,   including  the   Company  and   its
          stockholders, employees, directors and  optionees.  In the  event
          of any conflict or inconsistency between determinations,  orders,
          resolutions, or  other actions  of the  Committee and  the  Board
          taken in connection with this Plan, the action of the Board shall
          control. 


                                     ARTICLE IV

                              STOCK SUBJECT TO THE PLAN

                    SECTION 1.  The Shares to  be issued or delivered  upon
          exercise of Options shall be made available, at the discretion of
          the Board, either from the authorized but unissued Shares of  the
          Company or  from  Shares  reacquired by  the  Company,  including
          Shares purchased by the Company in  the open market or  otherwise
          obtained; provided, however, that the Company, at the  discretion
          of the Board, may,  upon exercise of  Options granted under  this
          Plan,  cause  a  Subsidiary  to  deliver  Shares  held  by   such
          Subsidiary.

                    SECTION 2.  Subject to the  provisions of Section 3  of
          this Article  IV, the  aggregate number  of Shares  which may  be
          purchased pursuant to Options shall not exceed 410,000.

                    SECTION 3.  In the event that the Committee  determines
          that any dividend or other distribution  (whether in the form  of
          cash, Shares, Subsidiary  securities, other  securities or  other
          property), recapitalization,  stock split,  reverse stock  split,
          reorganization,  merger,   consolidation,   split-up,   spin-off,
          combination, repurchase or exchange of Shares or other securities
          of the Company, issuance of warrants or other rights to  purchase
          Shares or  other  securities of  the  Company, or  other  similar
          corporate transaction or  event affects the  Shares such that  an
          adjustment is determined  by the Committee  to be appropriate  to
          prevent dilution  or enlargement  of  the benefits  or  potential
          benefits intended to be made available  under the Plan, then  the
          Committee may, in its  sole discretion and in  such manner as  it
          may deem equitable, adjust any or all of (i) the number and  type
          of  Shares  (or   other  securities  or   property)  subject   to
          outstanding Options, and  (ii) the grant  or exercise price  with
          respect to any Option or,  if deemed appropriate, make  provision
          for a  cash  payment to  the  holder of  an  outstanding  Option;
          provided, that  the  number  of  Shares  subject  to  any  Option
          denominated in Shares  shall always be  a whole number.   In  the
          event the Company is merged or consolidated into or with  another
          corporation in  a transaction  in which  the Company  is not  the
          survivor, or in the event that substantially all of the Company's
          assets are  sold  to  another  entity  not  affiliated  with  the
          Company, any holder of an Option whether or not then exercisable,
          shall be entitled to receive (unless the Company shall take  such
          alternative action as may be  necessary to preserve the  economic
          benefit of the Option for the optionee) on the effective date  of
          any  such  transaction  (the  "Option  Cancellation  Date"),   in
          cancellation of  such Option,  an amount  in  cash equal  to  the
          Option Cancellation Gain relating  thereto, determined as of  the
          Option Cancellation Date.


                                      ARTICLE V

                          PURCHASE PRICE OF OPTIONED SHARES

                    The purchase price per Share under each Option shall be
          100% of the Fair Market Value of a Share at the time such  Option
          is granted, but in no case shall such price be less than the  par
          value of the Shares subject to such Option.


                                     ARTICLE VI

                              ELIGIBILITY OF RECIPIENTS

                    Options will  be granted  only to  individuals who  are
          Eligible Directors at the time of such grant.


                                     ARTICLE VII

                                  GRANT OF OPTIONS

                    SECTION 1.  Each Option shall constitute a nonqualified
          stock option which is not intended  to qualify under Section  422
          of the Code.

                    SECTION 2.    On June  1,  1994   and  June 1  of  each
          subsequent  year  through  and  including  1997,  each   Eligible
          Director, as of  each such date,  shall be granted  an Option  to
          purchase 1,656 Shares.  Each such Option shall become exercisable
          with respect to 414  Shares on each of  the first, second,  third
          and fourth  anniversaries  of  the  date  of  grant  and  may  be
          exercised by the holder thereof with  respect to all or any  part
          of the  Shares comprising  each installment  as such  holder  may
          elect at any time after such installment becomes exercisable  but
          no later than the termination date of such Option; provided  that
          each such Option shall become exercisable  in full upon a  Change
          in Control.

                    SECTION 3.  On July  14, 1997, each Eligible  Director,
          as of such date,  shall be granted an  Option to purchase  13,248
          Shares.  Each such Option  shall become exercisable with  respect
          to 3,312 Shares on  each of the first,  second, third and  fourth
          anniversaries of the date  of grant and may  be exercised by  the
          holder thereof with  respect to  all or  any part  of the  Shares
          comprising each installment as such holder may elect at any  time
          after such installment becomes exercisable but no later than  the
          termination date of such Option;  provided that each such  Option
          shall become exercisable in full upon a Change in Control.

                    SECTION 4.    On  June  1, 1998  and  June  1  of  each
          subsequent  year  through  and  including  2003,  each   Eligible
          Director, as of  each such date,  shall be granted  an Option  to
          purchase 5,000 Shares.  Each such Option shall become exercisable
          with respect to 1,250 Shares on each of the first, second,  third
          and fourth  anniversaries  of  the  date  of  grant  and  may  be
          exercised by the holder thereof with  respect to all or any  part
          of the  Shares comprising  each installment  as such  holder  may
          elect at any time after such installment becomes exercisable  but
          no later than the termination date of such Option; provided  that
          each such Option shall become exercisable  in full upon a  Change
          in Control.

                    SECTION 5.  The purchase price of Shares subject to any
          Option shall be the Fair Market  Value thereof on the  respective
          date of grant.


                                    ARTICLE VIII

                             TRANSFERABILITY OF OPTIONS

                    No  Options  granted  hereunder  may  be   transferred,
          pledged, assigned or otherwise encumbered by an optionee except:

                    (a)  by will;

                    (b)  by the laws of descent and distribution; or

                    (c)  if permitted by the  Committee and so provided  in
               the Option  or  an  amendment thereto,  (i)  pursuant  to  a
               domestic relations order,  as defined in  the Code, (ii)  to
               Immediate Family Members,  (iii) to a  partnership in  which
               Immediate Family  Members, or  entities in  which  Immediate
               Family Members are the owners, members or beneficiaries,  as
               appropriate, are the partners,  (iv) to a limited  liability
               company in which  Immediate Family Members,  or entities  in
               which Immediate Family  Members are the  owners, members  or
               beneficiaries, as appropriate, are the members, or (v) to  a
               trust for the benefit of Immediate Family Members; provided,
               however, that no more than a de minimus beneficial  interest
               in  a  partnership,  limited  liability  company  or   trust
               described in (iii),  (iv) or  (v) above  may be  owned by  a
               person who is not an Immediate Family Member or by an entity
               that is not  beneficially owned solely  by Immediate  Family
               Members.  "Immediate Family Members" shall be defined as the
               spouse and natural or  adopted children or grandchildren  of
               the optionee and their spouses.

          Any attempted  assignment,  transfer,  pledge,  hypothecation  or
          other disposition of  Options, or levy  of attachment or  similar
          process upon Options not specifically permitted herein, shall  be
          null and void and without effect.


                                     ARTICLE IX

                                 EXERCISE OF OPTIONS

                    SECTION 1.  Each Option shall terminate 10 years  after
          the date on which it was granted.

                    SECTION 2.  Except in  cases provided for in  Article X
          hereof, each Option may be exercised  by the holder thereof  only
          while the optionee to whom such Option was granted is an Eligible
          Director.

                    SECTION 3.  A person electing to exercise an Option  or
          any portion thereof then exercisable shall give written notice to
          the Company of  such election and  of the number  of Shares  such
          person has elected to purchase, and shall at the time of purchase
          tender the full purchase price of such Shares, which tender shall
          be made in cash  or cash equivalent (which  may be such  person's
          personal check) or in Shares already owned by such person  (which
          Shares shall be  valued for such  purpose on the  basis of  their
          Fair Market Value on the date of exercise), or in any combination
          thereof.  The Company shall have no obligation to deliver  Shares
          pursuant to the  exercise of  any Option,  in whole  or in  part,
          until such payment in full of  the purchase price of such  Shares
          is  received   by   the  Company.      No  optionee,   or   legal
          representative,  legatee,  distributee,   or  assignee  of   such
          optionee shall  be or  be deemed  to be  a holder  of any  Shares
          subject to such Option or entitled to any rights of a stockholder
          of the Company in  respect of any Shares  covered by such  Option
          distributable in connection therewith until such Shares have been
          paid for  in full  and certificates  for  such Shares  have  been
          issued or delivered by the Company.

                    SECTION 4.    Each  Option  shall  be  subject  to  the
          requirement that if  at any time  the Board shall  be advised  by
          counsel that the  listing, registration or  qualification of  the
          Shares subject to  such Option  upon any  securities exchange  or
          under any state or federal law, or the consent or approval of any
          governmental regulatory  body, is  necessary  or desirable  as  a
          condition of, or in connection with, the granting of such  Option
          or the issue or  purchase of Shares  thereunder, such Option  may
          not be  exercised  in  whole or  in  part  unless  such  listing,
          registration, qualification, consent or approval shall have  been
          effected or  obtained free  from  any conditions  not  reasonably
          acceptable to such counsel for the Board.

                    SECTION 5.    The  Company  may  establish  appropriate
          procedures to provide for payment  or withholding of such  income
          or other taxes as may be required  by law to be paid or  withheld
          in connection with the  exercise of Options,  and to ensure  that
          the Company receives prompt  advice concerning the occurrence  of
          any event which may  create, or affect the  timing or amount  of,
          any obligation to  pay or withhold  any such taxes  or which  may
          make available to  the Company any  tax deduction resulting  from
          the occurrence of such event.


                                      ARTICLE X

                               TERMINATION OF SERVICE
                               AS AN ELIGIBLE DIRECTOR

                    SECTION 1.  If and when  an optionee shall cease to  be
          an  Eligible  Director  for  any  reason  other  than  death   or
          retirement from the  Board, all of  the Options  granted to  such
          optionee   shall be  terminated except  that any  Option, to  the
          extent then exercisable, may be  exercised by the holder  thereof
          within three months after such optionee ceases to be an  Eligible
          Director, but not later than the termination date of the Option.

                    SECTION 2.  If and when  an optionee shall cease to  be
          an Eligible Director by reason of the optionee's retirement  from
          the Board, all of the Options  granted to such optionee shall  be
          terminated except that any Option, to the extent then exercisable
          or exercisable within  one year thereafter,  may be exercised  by
          the holder thereof within three years after such retirement,  but
          not later than the termination date of the Option.

                    SECTION 3.  Should an optionee die while serving as  an
          Eligible Director,  all the   Options  granted to  such  optionee
          shall be  terminated,  except  that  any  Option  to  the  extent
          exercisable by the  holder thereof   at the time  of such  death,
          together with the unmatured installment  (if any) of such  Option
          which at that time is next  scheduled to become exercisable,  may
          be exercised within one  year after the date  of such death,  but
          not later than the termination date of the Option, by the  holder
          thereof, the optionee's estate, or  the person designated in  the
          optionee's last will and testament, as appropriate.

                    SECTION 4.  Should an optionee die after ceasing to  be
          an Eligible Director, all of the Options granted to such optionee
          shall be  terminated,  except  that any  Option,  to  the  extent
          exercisable by the holder thereof at the time of such death,  may
          be exercised within one  year after the date  of such death,  but
          not later than the termination date of the Option, by the  holder
          thereof, the optionee's estate, or  the person designated in  the
          optionee's last will and testament, as appropriate.


                                     ARTICLE XI

                           AMENDMENTS TO PLAN AND OPTIONS

                    The Board may  at any time  terminate or  from time  to
          time amend, modify or suspend this Plan; provided, however,  that
          no such amendment  or modification  without the  approval of  the
          stockholders shall:

                    (a)   except  pursuant  to Section  3  of  Article  IV,
               increase the maximum number (determined as provided in  this
               Plan) of Shares which may be purchased pursuant to  Options,
               either individually or in aggregate;

                    (b)  permit the  granting of any  Option at a  purchase
               price other than 100% of the Fair Market Value of the Shares
               at the time  such Option is  granted, subject to  adjustment
               pursuant to Section 3 of Article IV;

                    (c)  permit the exercise of  an Option unless the  full
               purchase price  of the  Shares as  to  which the  Option  is
               exercised is paid at the time of exercise;

                    (d)  extend beyond June 1, 2003 the period during which
               Options may be granted;

                    (e)  modify in any respect the class of individuals who
               constitute Eligible Directors; or

                    (f)   materially  increase  the  benefits  accruing  to
               participants hereunder