McMoRan Announces Coast Guard/MarAd Publication of EA and Draft Finding

McMoRan Exploration Co. announced the publication of the Environmental Assessment (EA) and Draft Finding of No Significant Impact by the United States Coast Guard (Coast Guard) and the Maritime Administration (MarAd) for the Main Pass Energy Hub (MPEH) LNG license application. The Coast Guard issued a public notice on September 19, 2006, establishing a timeline for a record of decision on the project, including public hearings to be held during the week of October 2, 2006. Comments on the application, including from the Governors of adjacent coastal states (Louisiana, Mississippi and Alabama), are required by November 20, 2006, and a record of decision would be issued by January 3, 2007. A copy of the Coast Guard letter outlining the schedule is being filed with this press release on Form 8-K with the Securities and Exchange Commission (SEC). As previously reported, McMoRan submitted an amendment to its license application with the Coast Guard and the MARAD on May 31, 2006 to obtain approval of its MPEH(TM) project using Closed Loop technology. The EA analyzed the changes associated with the amended application and determined that the project will not have a significant impact on the environment. The Coast Guard has issued a Draft Finding of No Significant Impact for public review and comment. The Coast Guard indicated that comments from the public and from State and Federal agencies supported the Closed Loop technology.

In addition, McMoRan also reported that it received a letter from the Department of Natural Resources for the State of Louisiana on September 21, 2006 indicating that the proposed facility is consistent with the Louisiana Coastal Resources Program.

The MPEH terminal would be capable of regasifying LNG at a rate of 1 billion cubic feet of natural gas (Bcf) per day. The use of existing facilities provides significant cost advantages, and the proposed project benefits from its offshore location near established shipping lanes. McMoRan is continuing discussions with potential LNG suppliers as well as gas marketers and consumers in the United States to develop commercial arrangements for the facilities. McMoRan is also considering investments to develop substantial cavern storage and a 36-inch pipeline from MPEH to Coden, Alabama that would enable expanded access to U.S. gas markets. These plans include 28 Bcf of initial cavern storage capacity and aggregate peak deliverability from the proposed terminal, including deliveries from storage, of up to 2.5 Bcf per day. As previously announced, McMoRan has received approval from the Federal Energy Regulatory Commission to transport gas onshore using the proposed pipeline.