MMR & PXP purchased by Freeport Copper....... | TigerDroppings.com

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TJG210
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New Orleans
Member since Aug 2006
21588 posts

MMR & PXP purchased by Freeport Copper.......


WOW........

quote:

Mining giant Freeport-McMoRan , the world’s largest copper producer and among the top gold miners, announced it would acquire Plains Exploration & Production Co. for about $6.9 billion in cash and stock, and Freeport Exploration Co.for approximately $3.4 billion in cash.


LINK



This post was edited on 12/5 at 12:55 pm



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TheHiddenFlask
Clemson Fan
The Welsh red light district
Member since Jul 2008
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re: MMR & PXP purchased by Freeport Copper.......


Ole Jim made a little over $150 million before you count his stock options.

Maybe he will level Middleton Library and build something more decent.






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TJG210
LSU Fan
New Orleans
Member since Aug 2006
21588 posts

re: MMR & PXP purchased by Freeport Copper.......


Kind of suprised about Plains, didn't they just buy a ton of old Exxon fields?

I'm holding out hope someone will come along and buy me out of my ATP position.






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Janky
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Team Primo
Member since Jun 2011
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re: MMR & PXP purchased by Freeport Copper.......


quote:

Kind of suprised about Plains, didn't they just buy a ton of old Exxon fields?


BP






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Solo
LSU Fan
Member since Aug 2008
3644 posts

re: MMR & PXP purchased by Freeport Copper.......


Any word on whether MMR management/presence is effected? LA loses another corp headquarters...





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cwill
New Orleans Saints Fan
Member since Jan 2005
23865 posts

re: MMR & PXP purchased by Freeport Copper.......


I could see them relocating the E&P wing to Houston - into PXPs offices. Why any E&P company would put their HQ any place other than Htown is beyond me.





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Crbello4Hiceman
LSU Fan
Lurking
Member since May 2011
436 posts

re: MMR & PXP purchased by Freeport Copper.......


Nothing wrong with nola, unless you need to actively meet with customers.... plus with flight frequency between Nola and Houston it isn't as big of a deal IMHO.





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lsuguru
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re: MMR & PXP purchased by Freeport Copper.......


Energy XXI bought alot of old Exxon fields at the end of 2010. Almost a billion dollars worth...





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cwill
New Orleans Saints Fan
Member since Jan 2005
23865 posts

re: MMR & PXP purchased by Freeport Copper.......


quote:

Nothing wrong with nola, unless you need to actively meet with customers.... plus with flight frequency between Nola and Houston it isn't as big of a deal IMHO.


If you're an E&P you have to do deals, you have to network....you need to be in Houston...you can have a satellite office in Nola, but in this modern age it's not necessary, especially in the Gulf Coast region. And FTR there are no "customers".






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polizei11
LSU Fan
Lafayette
Member since May 2009
924 posts

re: MMR & PXP purchased by Freeport Copper.......


Pretty shocking news. McMoran and my company are partnered in several areas on the shelf. Will be interesting to see the new strategy on Ultra-Deep gas.





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cwill
New Orleans Saints Fan
Member since Jan 2005
23865 posts

re: MMR & PXP purchased by Freeport Copper.......


As I stated in the other thread this was a pretty incestuous deal that appeared more of a bailout for Jim Bob and Flores after it became clear that Davy Jones is a dog and UDW looks unworkable in general. NYT Dealbook today:

quote:

A $20 billion splurge by Freeport-McMoRan Copper & Gold on two oil exploration companies lives up to the worst standards of the energy resources sector. The mining company’s convoluted plans to buy Plains Exploration and Production and McMoRan Exploration swiftly erased some $5 billion of market value.


quote:

In addition to presiding over Freeport’s board, Mr. Moffett is chief executive and co-chairman of McMoRan, and owns stakes in both companies. Though the 14 percent decline in Freeport shares on Wednesday cost him some money, it was more than offset by the rich 74 percent premium being paid for McMoRan’s shares. According to Breakingviews calculations using Thomson Reuters data, he’s personally up on the day by about $19 million.


quote:

The recent troubles at the New Orleans-based McMoRan give the deal the whiff of a bailout. McMoRan has been plagued by delays in a Gulf of Mexico well, causing shares to plunge 40 percent over the last two months. The company also has been burning cash at a rapid rate.

The cross-holdings create other bad optics, too. James Flores, the boss of Plains Exploration, also sits on McMoRan’s board, and the deal has netted him about $12 million, on paper, for his Plains stake. What’s more, the fiendish complexity of the deal has Freeport partly paying for McMoRan using units of a royalty trust, which are difficult to value.


LINK






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C
LSU Fan
The Woodlands, TX
Member since Dec 2007
21099 posts

re: MMR & PXP purchased by Freeport Copper.......


Yeah PXP way overpaid for the BP assets earlier this year from what a friend who worked that deal for PXP told me. Said Jim was just looking for a seat at the table with the big boys.

Toatally agree about the incestuous aspects of this deal.






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GREENHEAD22
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re: MMR & PXP purchased by Freeport Copper.......


LINK

There is also talk that this is an indication of possible future troubles for FPMC&G. Talk about there main mine starting to take a down turn and talks about them getting the boot pretty soon from one of the countries they are operating in, cant remember which one, either Indonesia or one of the SA ones.






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TJG210
LSU Fan
New Orleans
Member since Aug 2006
21588 posts

re: MMR & PXP purchased by Freeport Copper.......


quote:

Will be interesting to see the new strategy on Ultra-Deep gas.


A couple years ago I was traveling to a fab yard to help out with some stuff on a high priority project for one of my clients and they were blowing and going on stuff for Davy Jones and at that point (and still can't) understand the hurry to produce these deep gas wells. With the prices being so low, how can they be profitable at this point in time, and without some major political shifts, not sure I see the price going up anytime soon.






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cwill
New Orleans Saints Fan
Member since Jan 2005
23865 posts

re: MMR & PXP purchased by Freeport Copper.......


quote:

With the prices being so low, how can they be profitable at this point in time,


Probably on the books before the price collapsed and the projected (by MMR) production/reserves and rate were so significant that even at $3/M it would pay out and make money....still $$$ in long life gas.






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cwill
New Orleans Saints Fan
Member since Jan 2005
23865 posts

re: MMR & PXP purchased by Freeport Copper.......


quote:

There is also talk that this is an indication of possible future troubles for FPMC&G. Talk about there main mine starting to take a down turn and talks about them getting the boot pretty soon from one of the countries they are operating in, cant remember which one, either Indonesia or one of the SA ones.


That's interesting...I haven't heard anything along those lines...I had read your link earlier, was going to post, too...such a huge conflict and such an obvious bailout....it's going to get ugly with the Freeport shareholders, especially the big boys.






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GREENHEAD22
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re: MMR & PXP purchased by Freeport Copper.......


"Freeport's major overseas copper holdings are in the Democratic Republic of the Congo and Indonesia. Lately the company's had dire problems with the government of Indonesia and with the workers at its gigantic Grassberg mine."

"Plus lately the ore's become harder to pull out and is a lesser grade."

"Billy Bob Moffat, the chairman, president and CEO of McMoran Exploration is also chairman of Freeport McMoran. He's using Freeport money and stock to buy MMR, a wildcatting company that's drilling a gigantic well, the Davy Jones, in the Gulf of Mexico, that's been disastrous so far for the company."

noted the 'relationship issue' with Plains Exploration. "Plains owns 31.5% of McMoran and Plains ' CEO , Jim Flores, is on the board of McMoran."






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