McMoRan Exploration Co. Provides Update on Main Pass Energy Hub(TM) Offshore LNG Project

As previously reported, McMoRan submitted an amendment to itslicense application with the U.S. Coast Guard (Coast Guard) and theMaritime Administration (MARAD) on May 31, 2006 to obtain approval ofits Main Pass Energy Hub(TM) project using Closed Loop technology.

On July 21, 2006, the Coast Guard advised McMoRan that theinformation provided in the amendment along with informationpreviously provided contain sufficient information to continueprocessing of the license application to incorporate Closed Looptechnology. The Coast Guard also advised that they will prepare anEnvironmental Assessment (EA) to evaluate the application amendment.The EA will focus on the changes associated with the vaporizationtechnology which was fully evaluated as a reasonable alternative inthe Final Environmental Impact Statement published in March 2006.

Following publication of the EA, the Coast Guard will conductfinal public hearings in the adjacent coastal states, followed by a45-day period to allow public comment and response by the Governors inthe adjacent coastal states (Louisiana, Mississippi and Alabama).After the 45-day comment period, MARAD has up to 45 days to issue aRecord of Decision. A copy of the Coast Guard letter outlining theprocess is being filed with this press release on Form 8-K with theSecurities and Exchange Commission.

McMoRan expects the EA would be published in late September 2006with a record of decision by the end of 2006.

The MPEH(TM) terminal would be capable of regasifying LNG at arate of 1 billion cubic feet of natural gas (Bcf) per day. The use ofexisting facilities provides significant cost advantages, and theproposed project benefits from its offshore location near establishedshipping lanes. McMoRan is continuing discussions with potential LNGsuppliers as well as gas marketers and consumers in the United Statesto develop commercial arrangements for the facilities.

McMoRan is also considering investments to develop substantialcavern storage for a pipeline header system that would allowdeliveries into U.S. gas markets. Current plans for the MPEH(TM)include 28 Bcf of initial cavern storage capacity and aggregate peakdeliverability from the proposed terminal, including deliveries fromstorage of up to 2.5 Bcf per day. As previously announced, McMoRanreceived approval from the Federal Energy Regulatory Commission tobring gas onshore using its proposed 36-inch pipeline into Coden,Alabama.

McMoRan Exploration Co. is an independent public company engagedin the exploration, development and production of oil and natural gasoffshore in the Gulf of Mexico and onshore in the Gulf Coast area.McMoRan is also pursuing plans for the development of the MPEH(TM)which will be used for the receipt and processing of liquefied naturalgas and the storage and distribution of natural gas. Additionalinformation about McMoRan and the MPEH(TM) project is available on itsinternet website "www.mcmoran.com" and at "www.mpeh.com".

CAUTIONARY STATEMENT: This press release contains certainforward-looking statements regarding the potential Main Pass EnergyHub(TM) Project, the expected near-term funding of the relatedpermitting process and the estimated capital costs for developing theproject. Accuracy of the projections depends on assumptions aboutevents that change over time and is thus susceptible to periodicchange based on actual experience and new developments. McMoRancautions readers that it assumes no obligation to update or publiclyrelease any revisions to the projections in this press release and,except to the extent required by applicable law, does not intend toupdate or otherwise revise the projections more frequently thanquarterly. Important factors that might cause future results to differfrom these the ability to obtain regulatory approvals and significantproject financing for the potential Main Pass Energy Hub(TM) project.Such factors and others are more fully described in more detail inMcMoRan's 2005 Annual Report on Form 10-K on file with the Securitiesand Exchange Commission.