Jim Flores’ Plains Exploration & Production is now part of Freeport-McMoRan Oil and Gas, a wholly owned subsidiary of Freeport-McMoRan Copper & Gold. The Lafayette native, who last month announced PXP’s plans to build an $18 million deepwater facility
in Broussard, has assumed the dual roles of Vice Chairman of FCX and president and chief executive officer of Freeport-McMoRan Oil & Gas. Flores previously was chairman, president and CEO of Plains.
|Lafayette native Jim Flores
Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX) Monday announced that it has completed the final step of its three-way combination with Plains Exploration & Production Company (NYSE: PXP) and McMoRan Exploration Co. (NYSE: MMR). The PXP transaction closed on May 31, and the MMR transaction closed Monday.
The company said in a prepared statement that the transactions add a high quality portfolio of oil and gas assets to FCX’s global mining business to create a premier U.S.-based natural resource company:
The acquired businesses provide exposure to energy markets with positive fundamentals, strong margins and cash flows, exploration leverage and financially attractive long-term investment opportunities. The portfolio of assets includes established oil production facilities in California, a growing production profile in the onshore Eagle Ford trend in Texas, significant production facilities and growth potential in the Deepwater Gulf of Mexico and large onshore resources in the Haynesville natural gas trend in Louisiana. The company will also have an industry leading position in the emerging shallow water, ultra-deep gas trend on the shelf of the Gulf of Mexico and onshore in South Louisiana.
The value of the transactions was $19 billion, including $10 billion in assumed debt, $5.5 billion in cash consideration and 91 million shares of FCX stock (valued at $2.8 billion as of May 31) and other consideration, including the PXP supplemental dividend and the value of the royalty trust units to MMR shareholders. After giving effect to these transactions, FCX has approximately 1,038 million shares outstanding.
“The addition of PXP’s U.S. oil and gas assets to FCX’s global mining business establishes a significant, long-term commodities business positioned to generate meaningful returns over an extended period,” Flores said in a prepared release. “We are excited to join FCX’s global team and will be focused on executing our highly profitable, long-term, oil-focused growth plan, which is complementary to the growth profile and cash margins of the large, low-cost, expandable asset base characteristics of FCX.”