Freeport-McMoRan announces completion of Gulf of Mexico property sale

Contributed Photo: Freeport-McMoRan announced the completion of the sale of its Gulf of Mexico deepwater oil and gas assets to Anadarko Petroleum Corp.

PHOENIX – Freeport-McMoRan Inc. (FMI) announced Tuesday that it has completed the previously announced sale of its Deepwater Gulf of Mexico (GOM) properties to Anadarko Petroleum Corporation (NYSE: APC) for $2 billion in cash, before closing adjustments. In connection with this transaction, FMI also settled a preferred stock obligation with its consolidated subsidiary, Plains Offshore Operations Inc., for $582 million.

Under the terms of the agreement, FMI has the right to receive additional proceeds of up to $150 million, to be paid as Anadarko realizes future cash flows in connection with a third-party production handling agreement for the Marlin platform.

FMI expects to complete the previously announced sale of its onshore California oil and gas properties before year-end 2016. Following completion of this transaction, FMI’s portfolio of oil and gas assets would include oil and natural gas production onshore in South Louisiana and on the GOM Shelf, oil production offshore California and natural gas production from the Madden area in Central Wyoming. In third-quarter 2016, these properties produced an average of 7 MBbls of oil and NGLs per day and 74 MMcf of natural gas per day.

The deals came during a year in which Freeport-McMoRan’s top oil and gas executives, including CEO and longtime LSU benefactor Jim Flores, were let go, a shake-up that some industry observers viewed as a sign of Freeport-McMoRan’s reduced focus on energy exploration and production amid slumping commodities prices.

 Late last year, James R. Moffett, Freeport-McMoRan’s co-founder, announced that he was stepping down as executive chairman.

In 2007, Freeport-McMoRan, the world’s largest publicly traded copper producer, relocated its headquarters from New Orleans to Phoenix after completing a $25.9 billion buyout of Phelps Dodge Corp.

Freeport is a leading international mining company. It operates large, long-lived, geographically diverse assets with significant proven and probable reserves of copper, gold and molybdenum. FMI is the world’s largest publicly traded copper producer.

FMI’s portfolio of assets includes the Grasberg minerals district in Indonesia, one of the world’s largest copper and gold deposits; significant mining operations in the Americas, including the large-scale Morenci minerals district in North America and the Cerro Verde operation in South America.