Freeport McMoRan Oil & Gas wins 20 tracts in Gulf of Mexico lease sale Freeport-McMoRan announced that its oil & gas segment, Freeport-McMoRan Oil & Gas was the apparent high bidder on 20 tracts in the Central Gulf of Mexico Oil and Gas Lease Sale 231 with a total investment of approximately $330M net to FM O&G. The bids are subject to approval by the U.S. Bureau of Ocean Energy Management and these potential investments were included in the company’s previously reported FY14 capital budget. FM O&G winning bids were primarily focused on high-impact, drillable targets in the Mississippi Canyon and Atwater Valley areas to complement FM O&G’s existing infrastructure and production facilities and add several new exploration plays. The blocks, which cover approximately 106K gross acres, range in water depths up to 6K feet. The company expects to be notified and designated operator of these blocks by 3Q14.
Freeport McMoRan downgraded at BofA/Merrill As previously reported, BofA/Merrill downgraded Freeport McMoRan to Underperform from Neutral. The firm lowered Freeport McMoRan free cash flow estimates and price target to $19 from $22.50 following a reduction in copper and Brent oil price forecasts and said it does not expect a recovery until 2017 and the dispute over Grasberg remains an overhang.