#1The Special Committee of the Board of Directors of McMoRan Exploration Co. Preliminary Discussion Materials November 9, 2012 EVERCORE PARTNERS McMoRan#2These materials have been prepared by Evercore Group LLC. ("Evercore") for the Special Committee of the Board of Directors of McMoRan Exploration Co. (the "Special Committee" or the "Company") to whom such materials are directly addressed and delivered and may not be used or relied upon for any purpose other than as specifically contemplated by a written agreement with Evercore. These materials are based on information provided by or on behalf of the Company, from public sources or otherwise reviewed by Evercore. Evercore assumes no responsibility for independent investigation or verification of such information and has relied on such information being complete and accurate in all material respects. To the extent such information includes estimates and forecasts of future financial performance prepared by or reviewed with the management of the Company or obtained from public sources, Evercore has assumed that such estimates and forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of such management (or, with respect to estimates and forecasts obtained from public sources, represent reasonable estimates). No representation or warranty, express or implied, is made as to the accuracy or completeness of such information and nothing contained herein is, or shall be relied upon as, a representation, whether as to the past, the present or the future. These materials were designed for use by specific persons familiar with the business and affairs of the Company. These materials are not intended to provide the sole basis for evaluating, and should not be considered a recommendation with respect to, any transaction or other matter. These materials have been developed by and are proprietary to Evercore and were prepared exclusively for the benefit and internal use of the Company These materials were compiled on a confidential basis for use of the Company in evaluating the potential transaction described herein and not with a view to public disclosure or filing thereof under state or federal securities laws, and may not be reproduced, disseminated, quoted or referred to, in whole or in part, without the prior written consent of Evercore. These materials do not constitute an offer or solicitation to sell or purchase any securities and are not a commitment by Evercore (or any affiliate) to provide or arrange any financing for any transaction or to purchase any security in connection therewith. Evercore assumes no obligation to update or otherwise revise these materials. These materials may not reflect information known to other professionals in other business areas of Etercore and its affiliates. Evercore and its affiliates do not provide legal, accounting or tax advice. Accordingly, any statements contained herein as to tax matters were neither written nor intended by Evercore or its affiliates to be used and cannot be used by any taxpayer for the purpose of avoiding tax penalties that may be imposed on such taxpayer. Each person should seek legal, accounting and tax advice based on his, ber or its particular arcumstances from independent advisors regarding the impact of the transactions or matters described herein. EVERCORE PARTNERS#3Table of Contents Introduction McMoran Situation Analysis Preliminary Financial Analysis Appendix EVERCORE PARTNERS Section I II III Confidential MOMORAN#4I. Introduction EVERCORE PARTNERS#5Introduction Situation Update ■ Evercore Group L.L.C. (Evercore") has been engaged by the Special Committee of the Board of Directors (the "Special Committee") of McMoRan Exploration Co. ("McMoRan", "MMR", or the "Company") to provide financial advisory services to the Special Committee in connection with the consideration of strategic alternatives available to the Company, including, among other things, a potential transaction or series of transactions involving Freeport-McMoRan Copper & Gold ("Freeport" or "FCX") or any of its affiliates Confidential ■ Freeport owns 500,000 shares of convertible perpetual preferred stock with an initial conversion price of $16.00 which would equate to 31,250,000 common shares upon conversion, or 16.2% of the voting shares ■ Plains Exploration & Production Company ("Plains E&P") currently owns 31.5% of the voting shares of the Company ■ On November 1, 2012, Freeport made a proposal pursuant to which, if the parties were to proceed, Freeport would acquire the Company for $15.00 per share in cash (the "Proposed Transaction") EVERCORE PARTNERS MOMORAN#6Introduction Overview of Materials ■ Evercore is pleased to provide the materials herein to the Special Committee of McMoRan regarding the Proposed Transaction ■ The materials herein review the following: Confidential An introduction, including an overview of McMoRan's organizational structure and a review of Evercore's evaluation process to date A current situation analysis for McMoRan, including current market and capital structure information, Wall Street research estimates and commentary, a shareholder overview, financial projections for the Company as provided by McMoRan management and a review of the assumptions utilized by McMoRan management in deriving such financial projections An analysis of the Proposed Transaction, including: (1) implied transaction metrics and (ii) an offer price premiums analysis A preliminary valuation analysis of McMoRan EVERCORE PARTNERS MOMORAN#7Introduction McMoRan Corporate Structure and Ownership Freeport McMoRan Copper & Gold Inc. (FCX) Holds 500,000 shares of convertible perpetual preferred stock. Each preferred share is initially convertible into 62.5 shares of MMR common stock at an initial conversion price of $16.00 per share. As of December 31, 2011, the convertible preferred shares would have equated to 31,250,000 common shares had they been converted, representing a 16.2% ownership of all MMR outstanding shares on December 31, 2011. 100% Freeport Sulphur Company 33.33% Grande Ecaille Land Company, Inc. 100% 100% Freeport-McMoRan Energy LLC 100% Freeport Egyptian Sulphur Company Southern Bayou Holdings LLC Southern Pearl Holdings LLC Tank Barge LLC Freeport Pipeline Company Freeport Rotterdam, Inc. Freeport-McMoltan Development LLC Public Ownership) 99.5% 68.5% McMoRan Exploration Co. (MMR) 100% Freeport International, Inc. 0.05% Freeport Azufre Limitada Plains Exploration & Production Company (PXP)(¹) 31.5% 100% McMoran Oil & Gas LLC (MOXY) (1) Applicable ownership percentage assumes Convertible Perpetual Preferred shares held by Freeport McMoRan Copper and Gold Inc. have not yet been converted EVERCORE PARTNERS 100% Freeport Canadian Exploration Company K-Me Venture I LLC McMoRan International Inc. Confidential MOMORAN#8Introduction Evercore Evaluation Process and Due Diligence ■Evercore has been actively engaged in due diligence with MMR management since being retained by the Special Committee ■ Evercore attended three meetings with McMoRan's technical team An overview meeting on August 15, 2012 given by James Moffett and the McMoRan technical team to a group of advisors working for various companies involved in the contemplated transaction Confidential on Management presented their views on the overall geology of the ultra-deep shelf play and provided specifics or major discoveries and prospects A technical discussion on September 13, 2012 with McMoRan's technical team including a geophysical review and discussion of sizing parameters for the ultra-deep portfolio Reviewed 3D seismic of each of the discoveries and prospects with the McMoRan technical team - An in-person meeting on October 15, 2012 with McMoRan's technical team covering sizing and risking of ultra-deep prospects and discoveries Evercore presented its view of geologic risk for each prospect and discovery and discussed those assumptions with McMoRan's technical team ■ MMR is currently awaiting the flow-testing of the Davy Jones #1, the ultimate results of that production test will be a significant data point for the ultra-deep shelf play EVERCORE PARTNERS MOMORAN#9Introduction Evercore Evaluation Process and Due Diligence (cont'd) ■ In connection with its review of the Proposed Transaction, Evercore has, among other things: - Reviewed certain publicly available financial and operating data relating to McMoRan that we deemed to be relevant, including publicly available research analyst estimates - I Confidential Reviewed and discussed certain non-public financial and operating data and projects related to McMoRan furnished to us by management of the Company Reviewed the Ryder Scott Company, L.P. ("Ryder Scott") reserve report as of July 1, 2012 (the "Reserve Report") regarding McMoRan's proved and non-proved reserves located onshore in the Gulf Coast as well as offshore in the Gulf of Mexico Shelf Reviewed McMoRan's corporate operating model Reviewed and discussed McMoRan's management's assumptions regarding the resource potential of the Company's ultra-deep portfolio Reviewed the reported prices and historical trading activity of the Company's common stock - Compared the financial performance of the Company and its stock market trading multiples with those of certain other publicly-traded companies that were deemed relevant Compared the financial performance of the Company and valuation multiples relating to the Proposed Transaction with those of certain other transactions that were deemed relevant Performed such other analyses and examinations and considered such other factors that Evercore deemed appropriate EVERCORE PARTNERS 5 MOMORAN#10II. McMoRan Situation Analysis EVERCORE PARTNERS#11McMoran Situation Analysis Overview Share Price Fully Diluted Shares Outstanding Market Capitalization Plus: 5.75% Convertible Perpetual Preferred Stock Plus: 11.875% Senior Notes Due 2016 Key Company Data & Implied Metrics As of 11/08/12 Plus: 4.00% Convertible Senior Notes Due 2017 Plus: 5.25% Convertible Notes Due 2013 Less: Cash Total Enterprise Value Estimates and Implied Metrics Price / Cash Flow Per Share 2012E 2013E EV / EBITDAX 2012E 2013E EV/ Proved Reserves ($/Mcfe) EV/Production ($/Mcfed) Current 2012E 2013E Net Debt + Pref. / Net Book Capitalization Net Debt + Pref. / 2012E EBITDAX Net Debt + Pref / Proved Reserves (S/Mde) Net Debt + Pref/ Proved Developed Reserves (S/Mcfe) Data $0.64 $0.59 $179.0 $169.5 208.5 133,809 140,369 148,635 $2,674.4 $179.0 208.5 170.6 $12.51 164.4 $2,056.1 700.0 300.0 200.0 67.8 (191.9) $3,132.0 Metric 19.6x 21.2x 17.5x 185x $15.02 $23,406 $22,313 $21,072 40.2% 6.0x $5.16 $6.31 Share Price 200% Two Year Price Performance (11/9/10-11/8/12) 150% 100% 50% 0% Current Price Mas Meas Median Min 1 Week 1 Month 6 Months 1 Year 2 Years 11/9/10 Source: Public filings, FactSet, Equity Research (1) Peer Group includes Cobalt, Energy XXI, EPL Oil & Gas, Stone Energy and W&T Offshore (2) Includes conversion of 12.118 million 80% convertible perpetual preferred shares ($6.84 conversion price per share) into 1.8 million shares EVERCORE PARTNERS 6 ($ in millions, except per share amounts) $12.51 18.74 13.93 13.74 7.99 $12.48 11.96 12.35 11.77 12:25 13.92 4/4/11 8/28/11 MeMoRan Exploration Co. Confidential www. 1/21/12 -Peer Group) 6/15/12 143% Natural Gas 89% 75% 11/8/12 MOMORAN#12McMoRan Situation Analysis Asset Overview Asset Overview MMR's assets are composed of conventional Gulf Coast onshore and Gulf of Mexico Shelf assets (the "Conventional Assets") and its Ultra-Deep shelf play (the "Ultra-Deep Assets") MMR's Conventional Assets comprise all current reserves and production ■ Proved Reserves: 208.5 Bcfe (10/1/12) 3P Reserves: 348.6 Befe (10/1/12) 2012 Q3 Production: 133.8 MMcfed MMR's Ultra-Deep Assets consist of sub-salt discoveries and prospects located in the Gulf of Mexico Shelf below 25,000 feet Unrisked Resource Potential: 123.2 Tefe gross (57.3 Tefe net) Risked Resource Potential: 36.7 Tefe gross (17.3 Tefe net) Ultra-Deep Discoveries (Pay Counts) ■ Davy Jones No. 1: 200' Wilcox Davy Jones No. 2: 120' Wilcox Sands; 192' Tuscaloosa Sands & Lower Cretaceous Carbonate Blackbeard West No. 1: 168' Miocene; 52' Oligocene Sand Blackbeard East: 178' Miocene First Frio Sand; 300' Sparta Carbonate Lafitte: 171' Miocene; 40' in Frio; 65' U. Eocene; 300' Sparta Carbonate EVERCORE PARTNERS Lincham Creek Davy Jones Field ☐ #1: Workover in progress to flow test Wilcox Sands Onshore Cameron Parish, LA Large Area of Potential Closure Drilling Below 20,900 ft; PTD 29,000 ft #2: Expect to commence completion following review of results from #1 well ■ Chevron Wl: 50% (Operator) MMR WI: 36% Ultra-Deep Risked Resource Potential 98.0% Areas of Operation Lafitte 55 miles away Resource Base (17.6 Tcfe) Expect to submit development plans with RSEE in 3Q 2012 Proved, 1.2% Probable, 0.4% Possible, 0.4% Reserves PDP PDBP PDSI PUD Total Proved Probable Total 2P Possible Total 3P Highlander Confidential Onshore south Louisiana 68,000+ gross acre area Expected to spud in 2H12 PTD: 30,000 ft Targeting Eocene, Paleocene and Cretaceous Objectives MMR WI: 72% Blackbeard West #2 WI: 69.4% ☐NRI: 53.1% ■ Drilling below 21,400 feet; PTD: 24,500 ft Blackbeard East Submitting initial development plans with BSEE ■ Plan to complete/test Upper Miocene Sands during 2013 with conventional equipment Continue to evaluate development of deeper zones Reserve Base (3P 348.6 Bcfe) 0 977 11,067 2,652 13,719 1,430 15,148 OXI NGL Gas Equiv. PV-10 (Mb) (M) (MM) (MMife) (SMM) 3,518 6,572 $95.1 $482.2 534 25,657 49,969 1,734 70,788 120,623 5 6 658 28,095 37,906 2,927 124,545 208,504 935 47,485 69,006 3,861 172,030 277,510 1,362 54,316 71,065 $189.4 5,223 226,346 348,575 $1,024.1 MoMoRan ($3.8) $58.9 $632.4 $302.3 8834.7#13McMoRan Situation Analysis Historical Share Trading Performance $24.00 $22.00 $20.00 $18.00 $16.00 $14.00 $12.00 $10.00 $4.00 11/15/11: Announced additional hydrocarbons in the Lafitte ultra deep exploration well 11/9/11 12/19/11 1/17/12: Announced 2011 year-end results EVERCORE PARTNERS 1/31/12: Exploration and Development Update 1/29/12 3/26/12: Announced flare at Davy Jones No, 1, however flow rates were not determinable I 3/7/12: Letter to shareholders 3/9/12 6/22/12: Announced that the Company was the apparent high bidder on 14 lease blocks in GOM Shelf 4/17/12: Announced first quarter 2012 results 4/19/12: Announced Davy Jones update 4/19/12 Volume 7/17/12: Announced 2Q 2012 Results 5/29/12 Price 7/30/12: Announced updated activity at Davy Jones No. 1, which included the delay of planned flow test 7/9/12 8/15/12: Commenced offer to exchange 51% convertible senior notes due 2012 9/13/12: Completes exchange offer 9/4/12: Announced operations update 8/18/12 Confidential 10/19/12: Announced i third quarter 2012 results 9/28/12 30,000 25,000 20,000 15,000 10,000 5,000 11/7/12 MOMORAN#14McMoRan Situation Analysis Research Analyst Recommendations and Price Targets Summary Price Targets Firm Name Jefferies JPMorgan Guggenheim Securities LLC Ladenburg Thalmann & Co Capital One Southcoast, Inc. RBC Capital Markets Howard Weil Inc Susquehanna Financial Group Dahlman Rose & Co Iberia Capital Partners LLC EVA Dimensions Analyst Biju Z. Perincheril Joseph D Allman Robert Cordray Noel A Parks Richard Tullis Leo P Mariani Joseph Bachmann Duane Grubert Nicholas P Pope Patrick Rigamer Team Coverage Recommendation hold underweight buy buy add outperform market perform positive buy sector perform sell Max Min Median Average Date 11/5/2012 10/31/2012 10/31/2012 10/22/2012 10/22/2012 10/19/2012 10/19/2012 10/19/2012 10/11/2012 7/19/2012 7/18/2012 Price Target $21.00 12.00 15.00 16.11 12-Month Price Target $12.00 20.00 21.00 15.00 14.00 15.00 18.00 15.00 15.00 Premium/(Discount) to Market 67.9% (4.1%) 19.9% 28.8% Discounted Price Target $10.58 (1) Analyst 12 month price target discounted back to present value at McMoRan's equity cost of capital of 13.4% to estimate a current share price target EVERCORE PARTNERS 17.64 18.52 13.23 12.35 13.23 15.87 13.23 13.23 Analyst Recommendations Sell 18% Confidential Hold 27% Buy 55% MOMORAN#15McMoRan Situation Analysis Research Analyst Commentary "In our view, the company is at an inflection point due to its exploration success in the Ultra Deep shelf of the U.S. Gulf Coast. This should drive value well beyond the current focus on Davy Jones #1. Realizing this value is the critical next step; we believe the company has created a portfolio with significant leverage along three key attributes: exploration optionality, improving well economics, and access to third-party (EP company) capital. We believe little upside potential is priced into the stock today, as we estimate that current prices reflect approximately 18% of deep shelf potential in the MMR portfolio." Confidential "The Davy Jones discovery and data from Lafitte and Blackbeard indicate significant potential for MMR's Ultra-Deep play. Results from Davy Jones potentially indicate a multiple Tefe structure with good quality sands. Logs at Lafitte and Blackbeard indicate that hydrocarbons are present. However, questions and risks remain with the completion of and production from these and other Ultra-Deep wells. Positive results could cause the stock to outperform." Guggenheim, Robert Cordray, October 31, 2012 Target Price: $20.00 "Davy Jones flow test could finally be around the corner, barring another unforeseen issue. The play may ultimately be productive, but our skepticism has more to do with its economic viability, considering the geological, technical, and financial risks involved, compared to an onshore shale asset." "MMR noted that it is engaged in discussions regarding financing of future activities, perhaps to address funding concerns from investors. We estimate the company will spend down its cash balance and necessitate new funds by early next year, yet another reason to be cautious about the stock." EVERCORE PARTNERS J.P. Morgan, Joseph Allman, October 31, 2012 Target Price: NA 10 "We value the company's oil and gas assets utilizing a 12% pre-tax discount rate and flat commodity prices of $100.00 for WTI oil and $5.00 for Henry Hub natural gas, and we notably do not assign significant value to McMoRan's other ultra-deep prospects. We rate McMoRan Outperform, Speculative Risk with a 12-month price target of $14.00. We hase our price target on a 13% discount to our NAV estimate. We believe MMR should trade at a discount to NAV dne to execution and reservoir risk in the ultra-deep shelf play. Our risk qualifier is Speculative owing to the Company's very high exploration risk, the still unproven productivity of ultra-deep finds, and regulatory and asset concentration risk in the Gulf of Mexico." Jefferies, Biju Perincheril, October 19, 2012 Target Price: $12.00 "MMR increased its 2012 CapEx guidance by 10% to $550 million, though this was still below our previous estimate of $600 million. MMR noted that it is engaged in discussions regarding financing of its future activities, with joint ventures being a solid option, and the Company has apparently had discussions with a number of potential domestic and international partners. A deal of some sort will need to happen soon, as we currently have MMR running out of liquidity in late 1Q13." RBC Capital Markets, Leo Mariani, October 19, 2012 Target Price: $14.00 MOMORAN#16McMoRan Situation Analysis Shareholder Name Institutional Wells Fargo & Co. Omega Advisors, Inc. Black Rock, Inc The Vanguard Group, Inc. DAY ROBERT ADDISON Wilkinson O'Grady & Co., Inc. (New York) State Street Corp. Lord, Abbett & Co. LLC Jokey Corp. Chilton Investment Co. LLC Other Total Institutional Insiders Plains Exploration & Production Co. James R. Moffett Gerald J. Fond Robert Addison Day BM Rankin Jr. Other Total Insider Retail Total Shares Outstanding (Basic) Float Short Interest (% of Basic) Shareholder Overview # of Shares % of Total Investor Type Source: FactSet EVERCORE PARTNERS 10,187,716 7,133,800 7,072,718 5,617,931 4,026,560 3,700,162 3,124,550 2,103,414 1,614,000 1,569,571 28.636,046 74,786,468 1.0% 17.7% 46.2% # of Shares % of Total 6.3% Investment Adviser Apgressive Growth 4.4% Hedge Hand 4.4% Mutual Fund 3.5% Mutual Fund 2.5% Hedge Fund 2.3% Investment Adviser 1.9% Mutual Fund 1.3% Mutual Fund 1.0% Investment Adviser Hedge Fund Strategy Turnover Activist Threat High Lav Fully Diluted 51,000,000 51,000,000 4,968,206 1,916,099 31.5% 3.1% 1.2% 8,918,206 1,949,849 1,078,660 0.7% 1,112,410 591,712 0.4% 614,587 721,242 0.4% 4,557,689 60,275,919 37.2% 68,152,741 26,815,613 16.6% 161,878,000 100.0% 101,602,081 13.5% 62.8% Index Index Value GARP Index Value Value Growth Low Medium 11 Very Low Very Low High Low Very Low Medium Low Medium ■ Freeport McMoRan Copper & Gold Inc. holds 500,000 shares of convertible perpetual preferred stock with each share convertible into 62.5 shares of MMR common stock at initial conversion price of $16.00 per share 00000000 Sovereign Wealth Manager 1% Insider Investor Type Value: 26% Broker 2% Confidential Other Index 19% Retail 16% Investment Adviser 17% Hedge Fund Company 13% Rate of Turnover Mutual Fund Manager 13% Aggressive Growth 16% GARP 27% Growth 6% Yield 4% Deep Value 2% Note: "GARP" is Growth At a Reasonable Price MOMORAR#17McMoran Situation Analysis MMR Volume Traded - Last Twelve Months Volume in Thousands Volume in Thousands 300,000 250,000 200,000 150,000 100,000 50,000 800,000 700,000 600,000 500,000 400,000 300,000 200,000 100,000 74,801 10.9% $7.00 - $9.00 74,801 10.9% $7.00 - $9.00 EVERCORE PARTNERS 110,009 16.1% $9.00 - $11.00 184,810 27.0% LTM Volume Traded $9.00 - $11.00 209,721 30.6% LTM Cumulative Volume Traded $11.00 - $13.00 394,532 57.6% $11.00 - $13.00 12 256,709 37.5% $13.00-$15.00 651,241 95.1% $13.00-$15.00 33,524 4.9% Confidential $15.00-Above 684,765 100% $15.00-Above MOMORAN#18McMoRan Situation Analysis Summary Financial Projections - Assumptions ■ The following financial projections summarize McMoRan's operating model (the "MMR Operating Model) as provided by McMoRan management ■ The projections incorporate all activity associated with the Conventional Assets ■ In addition, the projections incorporate the development of MMR's Ultra-Deep Assets utilizing the following assumptions: 100% success rate on exploration wells (no dry hole costs) Gross prospect size of 2 Tcfe 1 Confidential To develop a 2 Tcfe discovery requires 3 development wells drilled per year following an initial discovery well up to 10 total successful wells 200 Befe gross reserves per well (95% natural gas, 5% condensate) Drilling cost per well of $100 million Completion cost per well of $100 million - Facilities cost of $43 million per well 1 year drilling duration per well and 6 months to complete per well Wells commence 18 months following spud date ■ NYMEX strip pricing as of November 1, 2012 through 2016E and held flat thereafter ■ Assumed 35% U.S. Federal corporate tax rate EVERCORE PARTNERS 13 MOMORAN#19McMoRan Situation Analysis Summary Financial Projections Production Natural Gas (Bef) Oil (MMBbls) Plant Products (Befe) Total (Befe) Daily (Befed) Realized Prices Natural Gas ($/Mcf) Crude Oil ($/Bbl) Oil and Natural Gas Revenue LOE G&A Adjusted EBITDAX Less: Interest Expense Less: Preferred Dividends Less: Cash Taxes Discretionary Cash Flow Capex Free Cash Flow EVERCORE PARTNERS 2012E 32.4 2.1 5.4 50.5 138 $3.56 87.37 $381 ($155) (51) $175 Summary Financial Projections ($2) $132 ($550) ($417) 2013E 40.5 2.0 2.5 54.8 $3.90 88.71 $352 ($127) (49) $177 ($15) (41) $121 ($500) ($379) 2014E 95.4 2.2 1.7 110.6 14 $4.22 88.50 $614 ($127) (49) $438 ($26) (41) $370 ($749) ($379) 2015E 145.6 3.0 1.3 164.6 $4.40 85.36 $902 ($126) (49) $727 ($32) (41) (6) $647 ($551) $96 2016E 187.5 3.1 0.8 207.2 $4.60 85.36 $1,137 ($122) (49) $966 ($24) (41) (68) $833 ($489) $344 2017E 228.7 2.7 3.1 248.1 680 $4.60 85.36 $1,306 ($120) (49) $1,138 ($12) (41) (232) $852 ($493) $360 2018E ($ in millions) 262.9 3.1 3.4 Confidential 285.0 781 $4.60 85.36 $1,500 ($121) (49) $1,330 ($37) (41) (316) $935 ($443) $492 2019E 281.8 3.0 1.2 301.0 825 $4.60 85.36 $1,560 ($115) (49) $1,396 ($36) (41) (380) $939 ($437) $501 MOMORAN#20III. Preliminary Financial Analysis EVERCORE PARTNERS#21Preliminary Financial Analysis Summary of Proposed Transaction Current Offer Price ($/share) Fully-Diluted Shares Outstanding (MM) Implied Equity Value Plus: Current Net Debt + Prefs Implied Enterprise Value EV/2012E EBITDAX EV/2013E EBITDAX Offer Price/2012E. CFPS Offer Price/2013E CFPS EV/Proved Reserves EV/3Q Production EV/2013E Production Type of Average VWAP Implied Premium Simple Average Implied Premium Proposed Transaction Metrics $15.00 165.3 $2,480 $1,076 $3,555 $12.51 19.9% 19.9% EVERCORE PARTNERS I/B/E/S $179.0 $169.5 $0.64 $0.59 208.5 Befe 133,809 Mcfed 148,635 Mcfed Multiple 19.9x 21.0x 15 23,5x 25.4x $17.05 $26,571 $23,920 ($ in millions, except per share and unit amounts) Company Estimates $175.4 $177.0 $0.80 $0.73 208.5 Befe 133,809 Mcfed 150,259 Mafed Offer Price Premium Analysis Trading Days Period of Time Current 1-Day $12.57 5-Day 10-Day 30-Day 90-Day 180-Day 1-Year 2-Year High $12.44 $12.15 $11.83 $12.64 $11.37 $12.11 $13.64 19.3% 20.6% 23.5% 26.8% 18.6% 32.0% 23.9% 10.0% $12.51 $12.48 $12.06 $11.70 $12.61 $11.56 $12.26 20.2% 24.3% 28.2% 18.9% 29.8% 22.4% Confidential Multiple 20.3x 20.1x 18.8x 20.5x $17.05 $26,571 $23,662 52-Week Low $13.93 $16.57 $7.76 7.7% (9.5%) 93.3% MOMORAN#22Preliminary Financial Analysis Valuation Methodologies ■ In analyzing the Proposed Transaction, Evercore utilized the following methodologies for its preliminary valuation of McMoRan: Methodology Net Asset Valuation ("NAV") Analysis Peer Group Trading Analysis Precedent Transactions Analysis Discounted Cash Flow Analysis EVERCORE PARTNERS Description Valuation based on the present value of the future after-tax cash flows expected to be generated from MMR's proved and non- proved reserves and resources Valuation based on public trading metrics of E&P companies with similar assets Valuation based on metrics of transaction value to cash flow, proved reserves, and current production for M&A transactions involving acquisitions of similar assets and premiums paid in corporate transactions with all cash consideration in 2012 YTD Valuation based on the net present valuation of MMR's current projections of future after-tax free cash flows assuming selected discount rates and terminal value multiples 16 Confidential Assumptions ▪ Cash flows based on the Reserve Report and the Company's resource estimates for its Ultra-Deep prospect portfolio Proved reserves based on the Reserve Report Financial projections based on I/B/E/S estimates • Reviewed trading multiples for selected GOM and onshore Gulf Coast companies • Reviewed resource trading multiples for Cobalt International Energy, Inc. ("Cobalt") Proved reserves based on the Reserve Report Reviewed selected transactions that included assets in the Gulf of Mexico shelf and onshore Gulf Coast since 2009 with transaction value greater than $20 million Valuation date as of October 1, 2012 Terminal value based on a 5.0x EBITDA exit multiple and an assumed 0.5% growth in perpetuity * 35.0% federal tax • Tax depreciation based on a full-step up in tax basis and 7-MACRS MCMORAR#23Preliminary Financial Analysis Summary Valuation $30.00 $25,00 $20.00 $15.00 $10.00 $5.00 $0.00 -$5.00 -$10.00 $15.05 $9.98 NYMEX mp (11/1/12 Offer Price: $15.00 -$1.86 -$4.49 EVERCORE PARTNERS Bikel NAV Analysis 500C/$300 Ge $10.25 $5.89 $19.76 $5004/05 $16.55 $7.77 Peer Groep Traling Analysis 206586 $5000-$5500/3dd $0364 BITDAX 17 Uhu-Dep $320-8011/366+ $19.21 $11.80 Cover 211 35dd Gulf Cart Che 243 Bde $2.50-$3.75/34 X399 Mal $3,500 $5,000/3 17,200 B $11.12 $7.55 andet Componer Convention $100-$1200/15 135,800 Midd $20,000-$25000/Med $TT MORBITDAX 120-155 $16.89 $15.74 Confidential $25.44 $20.33 Discounted NYMEX 3 (1/1/13 5.0 Mbiple 03% pity Growth R MOMORAN#24Preliminary Financial Analysis Net Asset Value Analysis - Assumptions ■ Projections of proved, probable and possible production, operating costs, and capital expenditures based on the Reserve Report rolled forward to October 1, 2012 Volumes and risking for specific Ultra-Deep prospects and discoveries (as per MMR estimates) Geologic and mechanical risking was estimated by Evercore and reviewed by MMR's technical team Utilized an expected value analysis based on the assumed geologic and mechanical risking Each well has a 200 Befe EUR - - Developed using a continuous four rig program through 2014, going to a six rig program in 2015 and finally an eight rig program by 2016, held constant thereafter Production for each well of 70 MMcfed held flat for six years, then exponential decline (as per MMR estimates) Condensate is 5% of well stream (8.8 bbl/MMcf) Gross well costs of $243.0 million per well (as per MMR estimates) $100.0 million and 1 year to drill $100.0 million and 6 months to complete $43.0 million to equip and tie-in Confidential First production after 18 months Operating costs are $150,000 per well per month plus $0.15 per Mcfe of transportation costs (as per MMR estimates) NYMEX strip pricing as of November 1, 2012 through 2016 and then held flat thereafter Three sensitivity cases: $75.00/Bbl oil, $3.00/MMBtu gas; $90.00/Bbl oil, $4.00/MMBtu gas; $105.00/Bbl oil, $5.00/MMBtu gas held flat Effective date of October 1, 2012 G&A expense of $40.0 million per year plus an incremental $30 million of ultra-deep G&A beginning in 2014E Insurance cost of $15.0 million per year plus an incremental insurance cost for the ultra-deep of 25% of ultra-deep lease operating expense Included sulphur reclamation expense at a PV-10 value of $18.6 million EVERCORE PARTNERS 18 MoMoRan#25Preliminary Financial Analysis Net Asset Value Analysis - Assumptions (cont'd) ■ Capital expenditures allocated 80% to intangible drilling costs ("IDCs") and 20% to tangible drilling costs ("TDCs") IDCs are expensed as incurred and TDCs are depreciated using a 7-year MACRS schedule - Utilization of estimated U.S. Federal net operating loss carry forwards of $717.0 million as of December 31, 2012 H U.S. Federal income tax rate of 35.0% Escrow funding payments of $5.0 million per year through 2017 to support the funding requirements related to the 2007 oil and gas acquisition property reclamation obligations Future capital shortfalls funded 50% with equity and 50% with debt at a 7.5% interest rate ■ Borrowing base of $150.0 million with none currently drawn and a $100.0 million letter of credit outstanding A 250 bps spread to LIBOR and the LIBOR curve as of November 6, 2012 on amounts drawn A 250 bps interest rate plus a 20 bps fronting fee on letters of credit An unused commitment fee of 0.5% on any undrawn amounts EVERCORE PARTNERS Confidential 19 MOMORAN#26Preliminary Financial Analysis Reserve Report - Summary Ryder Scott prepared an estimate of the proved, probable and possible reserves, future production and income attributable to MMR - The effective date of the Reserve Report is July 1, 2012 Evercore has mechanically rolled the Reserve Report forward to an effective date of October 1, 2012 and has updated the benchmark price deck to a NYMEX strip as of November 1, 2012 Evercore has also adjusted the Reserve Report for asset sales at West Delta, Mississippi Canyon and Eugene Island (sold 22.6 Befe of proved reserves) Total Proved Reserves Reserve Category PDP PDBP PDSI PUD Probable Total 2P Reserves Possible Reserve Category Total 3P Reserves PDP 14% POSS PROB 20% PDBP 35% PUD 11% Operated Status Operated Non-Op 45% 55% EVERCORE PARTNERS Product Mix Gas 65% Oil 26% Offshore 85% NGL 9% Onshore vs. Offshore Onshore 15% 20 Ryder Scott Reserves (November 1, 2012 NYMEX Strip; Effective October 1, 2012) Reserve Category PDP PDBP PDSI PUD Total Proved Reserves Probable Total 2P Reserves Possible Total 3P Reserves Reserve Category PDP PDBP PDSI PUD Total Proved Reserves Probable Total 2P Reserves Possible Total 3P Reserves Gulf of Mexico Shelf OF (Mb) 3,210 0 834 10,521 2330 307 95 143 12,852 1,299 14,150 Gulf Coast Onshore Ol (Mb) 545 867 131 998 3,518 6,572 10 977 11,067 2652 PV-10 NGL Beun. (Mb) (MM) (MMefe) (SMM) 35,905 115,914 6 32,008 183,833 14,631 66,864 S 23,058 104,558 34,365 138,923 41,359 180,282 53,850 237,683 57,263 294,946 335 1,698 13,719 1,430 15,148 658 2,691 917 3,608 1,352 4,960 NGL (Mb) 199 36 235 18 253 10 263 658 2,927 935 3,861 (MM) 5,223 11,025 3,924 5,038 19,987 33,107 12957 46,064 Total Conventional Assets OF NGL Equiv. (MM) (Mb) (MM) (MMefe) 534 25,657 70,788 1,734 5 Confidential 28,095 124,545 172,030 54,316 226,346 Equn. (MMife) 4,710 5,898 24,671 15,156 39,827 13,802 53,629 130,623 6 37,906 208,504 69,006 277,510 71,065 348,575 $54.5 $467.9 ($3.8) $43.6 $562.3 $155.2 $717.4 $153.7 $871.2 PV-10 (SMM) $40,7 $14.2 $0.0 $15.2 $70.1 $47.2 $117.3 $35.6 $152.9 PV-10 (3MM) $95.1 $4822 ($3.8) $58.9 $632.4 $202.3 $834.7 $189.4 $1,024.1 MCMORAN#27Preliminary Financial Analysis Ryder Scott Reserve Report - Production and Capital Expenditure Profile Production Profile Production (MMcfed) Capital Expenditures (SMM) 150.0 135.0 120.0 105.0 90.0- 75.0- 60.0 45.0- 30.0- 15.0 0 2012E Rem. $220.0 $200.0 $180.0 $160.0 $140.0 $120.0 $100.0 $80.0 $60.0 $40.0 $20.0 2013E $52.6 Proved Developed Producing 2014E Proved Developed Producing $175.6 $48.3 2012E 2013E 2014E Rem. EVERCORE PARTNERS 2015E $42.4 2015E 2016E Proved Developed Behind-Pipe $18.7 2017E 2016E Proved Developed Behind-Pipe 2018E $66.3 2017E Capital Expenditure Profile 2019E $2.9 2018E 21 $37.9 Proved Undeveloped 2020E 2019E Proved Undeveloped $30.9 2021E 2020E $8.4 2021E 2022E Probable $13.9 2022E Probable 2023E $11.9 20231 2024E Possible $0.0 20241 Confidential Possible 2025E Abandonment $12.1 2026E 2025E $3.8 2026E MOMOR#28Preliminary Financial Analysis Ultra-Deep Assets - Overview of Geological Risk Factors Petroleum System Element Source Material & Maturation Reservoir Trap & Seal Timing & Migration Reservoir Presence Reservoir Quality EVERCORE PARTNERS What it means Was there sufficient organic material available and was there sufficient thermal maturation of this material to create hydrocarbons in sufficient quantities to be expelled? Are there lateral and vertical seals to prevent hydrocarbons from migrating away from or out of the reservoir? Did petroleum migrate before Trap and Seal formed? Was Trap or Seal later deformed causing it to fail? Are there rocks of sufficient porosity to store commercial amounts of hydrocarbon? If present, can the reservoir produce, and at commercial rates? What is reservoir permeability and what is the degree of heterogeneity in the reservoir? Comments Related to MMR Ultra Deep Portfolio The basin has significant source rocks which were thermally mature with significant hydrocarbon expulsion Existing wells show presence of hydrocarbons from the Miocene to the Lower Cretaceous Based on available data, this risk is not viewed to be significant Confidential Prospect inventory targets largely 4-way anticlinal primary structures clearly evident on seismic Significant seal capacity demonstrated in shales and salts by existing well control Proof on concept has lowered risk significantly, but risk is not eliminated Primary anticlinal structures created in compressional system before migration reduce risk of timing failure Confirmed for discoveries by wells drilled thus far discovered sands and carbonates in the Frio, Vicksburg, Jackson, Yegua, Sparta, Wilcox, Tuscaloosa and Lower Cretaceous Carbonate formations All five wells drilled to date have found what appears to be reservoir rock from LWD and wireline logs These potential pay zones are also present in and correlate to major onshore, deepwater GOM and international locations This is the most significant area of uncertainty until a long term flow test is completed This is a significant source of dependant risk 22 MOMORAN#29Preliminary Financial Analysis Ultra-Deep Assets Overview Prospect Offshore Davy Jones Blackbeard East Lafitte Blackbeard West Offshore Discoveries Total England Barbosa Morgan Baratania Blackbeard West #3 Drake Davy Jones West Hurricane Hook Captain Blood Bonnet Queen Anne's Revenge Calico Jack Offshore Prospects Total Onshore Highlander Lineham Tortuga Onshore Total Total Ultra-Deep Category WI NRI Resource Potential Risked Volume Potential for MMR's Ultra-Deep Assets Gross Unrisked Net Unrisked Geologic Mechanical Resource Potential COS COS Discovery 63.4% 50.2% Discovery 72.0% 57.4% Discovery 72.0% 58.3% Discovery 69.4% 53.1% Prospect 36.0% 28.8% Prospect 72.0% 57.6% 72.0% 57.6% Prospect Prospect 72.0% 57.6% Prospect 69.4% 55.5% Prospea 72.0% 57.6% Prospect 36.0% 28.8% Prospect 72.0% 57.6% 57.6% Prospect 72.0% 57.6% Prospect 72.0% Prospect Prospect 72.0% 57.6% Prospect 72.0% 57.6% 36.0% 28.8% Near Term Drill 72.0% 57.6% Drilling 28.8% Prospect 72.0% 57.6% EVERCORE PARTNERS Befe 3,248 1,040 2,342 804 7,434 27,300 2,588 1,000 2,820 498 14,580 1,400 1,575 4,890 18,000 3,150 1,296 7,000 86,097 13,300 10,800 5,590 29,690 123,221 23 Befe 1,631 597 1,365 427 4,020 7,862 1,491 576 1,624 276 8,398 403 907 2,817 10.368 1,814 746 2,016 39,300 7,661 3,110 3,220 13,991 57,311 80.0% 80.0% 80.0% 80.0% 30.5% 30.5% 30.5% 30.5% 30.5% 28.9% 30,5% 30.5% 28.9% 30.5% 28,9% 30.5% 30.5% 30,5% 30.5% 28.9% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% Gross Risked Net Risked Resource Potential Resource Potential Befe 2,321 737 1,001 592 5,252 7,487 721 281 776 288 3,765 391 446 1,257 4,957 788 336 1,931 23,424 Confidential 3,578 2,976 1,465 8,020 36,696 Befe 1,165 423 933 315 2,836 2,156 415 162 447 160 2,169 113 257 724 2,855 454 194 556 10,661 2,061 857 844 3,762 17,260 MOMORAN#30EVERCORE PARTNERS 24 MOMORAN Discoveries Prospects ($1,000) 2012E 2013E 2014E 2015E 2016E 2017E 2018E 2019E 2020E 2021E 2022E 2023E 2024E 2025E 2026E 20271 2028E 2029E 2030E 2031E 2032E Free Cash Flow ($MM) ($500) $0 $500 $1,000 TTTT $1,500 Free Cash Flow (SMM) 2012B 2013E- 2014E 2015E 2016E- 2017E- 2018E- 2019E- 2020E 2021E 2022E- 2023E 2024E 2025E 2026E- 2027E 2028E 2029E- 2030E 2031E 2032E Net Opertaing Income 0 Capex Cumulative Free Cash Flow 2012E 2013E 2014E 2015E 2016E 2017E 2018E ($1,000) 2019E 2020E 2021E 2022E 2023E 2024E 2025E 2026E 2027E 2028E 2029E 2030E 2031E 2032E ($30,000) 200 ($500) ($20,000) Production (MMcfed) 400 ($10,000) NOI and Capex (SMM) $0 600 SO 800 $500 1,000 $1,000 $1,500 1,200 ■Discoveries Prospects Net Production $2,000 $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 1,400 Cumulative Free Cash Flow (SMM) Net Operating Income ($MM) Ultra Deep Development Profile - Risked Preliminary Financial Analysis Confidential#31Preliminary Financial Analysis Ultra Deep Risking Methodology ■ Industry standard expected value analysis relies on risk weighting outcomes by their probabilities ■ Cash flows from this analysis represent aggregate expected values for a full program inclusive of risk ■ Present Value of Development Well Risk-weighted sum of the Present Values of the Success and Mechanical Failure cases ■ Present Value of Full Development Sum of all development wells as calculated above Exploration Well Legend Expected Value for an Ultra Deep Prospect Full Development GCOS Success (1-GCOS) Failure = Exploration Well = Development Well 25 Present Value Σ of Full Development Present Value of Exploratory Dry Hole GCOS Probability of Geologic Success (%) MCOS = Probability of Mechanical Success (%) #1 #20 MCOS Success (1-MCOS) #30 Failure MCOS Success Failure (1-MCOS) MCOS Confidential Success Failure Expected Value of Ultra Deep Prospect Risk-weighted sum of the Present Value of Full Development and the Present Value of an Exploratory Dry Hole Risk Weighting Expected Value = COS x (Present Value of Full Development) + (1-COS) x (Present Value of Exploratory Dry Hole) EVERCORE PARTNERS (1-MCOS) Present Value of Well Present Value of Mech. Failure Present Value of Well Present Value of Mech. Failure Present Value of Well Present Value of Mech. Failure MOMORAN#32Preliminary Financial Analysis Net Asset Value Analysis - Discount Rate Sensitivity NAV Summary(¹) Proved Developed Producing Proved Developed Behind-Pipe Proved Undeveloped Proved Reserves Probable Proved plus Probable Reserves Possible 3P Reserves Ultra Deep Upside (Risked) P&A (Developed Properties) Gross Asset Value Less: G&A Less: Insurance Less: Sulphur Reclaimation Expense Pre-Tax Net Asset Value Less: Cash Taxes After-Tax Net Asset Value Add: Cash Less: Debt Less: Preferred Shares Equity Value Fully Diluted Shares $/Share 6.0% $259 632 78 $969 262 $1,231 233 $1,463 9,482 (238) $10,707 (1,094) (477) (19) $9,117 (2,655) $6,462 192 (300) 0 $6,354 232.2 $27.36 7.0% $256 608 73 $937 246 $1,183 222 $1,405 7,822 (231) $8,996 8.0% 192 (300) 0 $253 585 $907 231 $1,139 212 $1,351 6,537 (224) $7,663 (843) (358) (19) $5,312 230.8 $4,493 229.1 $23.02 $19.61 9.0% (1) NAVs based on NYMEX strip pricing as of November 1, 2012 for five years and held flat thereafter EVERCORE PARTNERS $251 564 65 $880 218 $1,098 203 (953) (410) (19) $7,614 $6,442 $5,506 $4,741 (2,194) (1,842) (1,567) (1,346) $5,420 $4,601 $3,939 $3,394 192 192 192 (300) (300) (568) 0 0 (700) $246 525 58 $829 195 $1,024 187 $1,301 $1,254 $1,211 5,515 4,687 4,002 (218) (212) (207) $6,598 $5,729 $5,006 $4,398 (685) (625) (575) (284) (257) (234) (19) (19) (19) (756) (318) (19) 10.0% $3,831 227.1 $16.87 Discount Rate 11.0% 26 $248 544 61 $853 206 $1,060 194 $2,318 164.9 $14.06 12.0% 192 (568) (700) $243 507 56 $806 185 $991 180 $1,170 3,429 (202) $1,862 1643 $11.34 15.0% $1,475 164.0 $8.99 $236 459 48 $744 159 $903 161 $1,064 2,169 (189) $4,105 $3,569 $2,379 (1,167) (1,019) $2,938 $2,551 192 (568) (700) $3,044 (463) (183) (19) (700) $1,679 192 (568) (712) $591 161.9 $3.65 20.0% $226 394 39 $660 128 $788 136 $924 951 (171) $1,704 (349) (133) $1,203 (401) $802 Confidential ($ in millions) 30.0% $209 303 27 $540 89 $629 102 $731 (92) (147) $492 (234) (83) (19) $156 (154) $3 192 (568) (712) 192 (568) (712) ($286) ($1,085) 161.9 161.9 ($1.77) ($6.70) 40.0% $195 244 20 $459 67 $526 80 $606 (450) (132) $24 (177) (59) (19) ($231) (66) ($297) 192 (568) (712) ($1,385) 161.9 ($8.56) MOMORAN#33Preliminary Financial Analysis Net Asset Value Analysis - Price Sensitivity Proved Developed Producing Proved Developed Behind-Pipe Proved Undeveloped Proved Reserves Probable Proved plus Probable Reserves Possible 3P Reserves Ultra Deep Upside (Risked) P&A (Developed Properties) Gross Asset Value Less: G&A Less: Insurance Less: Sulphur Reclaimation Expense Pre-Tax Net Asset Value Less: Cash Taxes After-Tax Net Asset Value Add: Cash Less: Debt Less: Preferred Shares Equity Value Fully Diluted Shares $/Share EVERCORE PARTNERS Discount Rate 8%-10% 10% -12% 15%-20% 20%-30% 30% -40% 10% -12% 8%-10% 12%-15% 8%-10% 10%-10% 12%-15% NYMEX Strip (11/1/12) Low High $248 507 39 $794 89 $884 80 $964 3,429 (212) $4,181 (463) (284) $3,414 (700) $2,714 NAV Summary 192 (568) (700) $1,638 164.1 $9.98 $253 544 48 $845 128 $974 102 $1,076 4,687 (224) $5,538 (575) (358) (19) $4,586 (1,019) $3,567 192 (568) (700) $2,491 165.5 $15.05 $75.00 Oil/ $3.00 Gas Low High 27 $181 381 14 $577 62 $639 50 $689 748 (212) $1,224 (463) (284) (19) $457 (96) Commodity Prices $361 192 (568) (712) ($727) 161.9 ($4.49) $185 409 20 $614 $704 65 $769 1,358 (224) $1,903 (575) (358) (19) $950 (164) $787 192 (568) (712) ($302) 161.9 ($1.86) $90.00 Oil / $4.00 Gas Low High $258 507 38 $803 87 $890 78 $967 2,549 (212) $3,304 (463) (284) (19) $2,537 (495) $2,042 192 (568) (712) $954 161.9 $5.89 $264 544 46 $853 124 $978 99 $1,076 3,593 (224) $4,445 (575) (358) (19) $3,492 (734) $2,758 192 (568) (700) $1,682 164.2 $10.25 Confidential ($ in millions) $105.00 Oil / $5.00 Gas Low High $335 633 61 $1,028 112 $1,140 105 $1,245 4,350 (212) $5,383 (463) (284) (19) $4,617 (982) $3,634 192 (568) (700) $2,558 165.7 $15.44 $342 678 73 $1,093 159 $1,252 132 $1,384 5,827 (224) $6,987 (575) (358) (19) $6,034 (1,399) $4,635 192 (300) 0 $4,527 229.2 $19.76 MOMORAL#34Preliminary Financial Analysis Peer Group Trading Analysis Company Encegy XXI Limited EPL Oil & Gas, Inc. Stone Energy Corporation W&T Offshore, Inc. Mean Median McMoRan Exploration Co. Company Cobalt McMo Ran Exploration Co. $32.44 $2,864 $20.39 $808 $20.52 $1,030 $16.65 $1,279 Price Equity Enterprise Proved 11/8/12 Value Value Reserves Current $1,495 $1,155 $12.51 $2,056 Area $3,765 $952 $1,381 $1,951 Enterprise Value Production 2012E 2013E (8/Mefe) (8/Mefed) (S/Mefed) (S/Mefed) Conventional Assets Trading Peers Price / CFPS $5.25 $13,178 $14,227 $2.16 $12,647 $11,735 $2.27 $5,526 $5,691 $2.78 $6,899 $6,803 $2,012 $3.11 31,666 $2.52 $3,132 $15.02 Total Company (GOM, Angola and Gabon) GOM (Miocene and Lower Tertiary) GOM (Miocene Only) GOM (Lower Tertiary Only) Africa (Angola and Gabon) $9,604 $9,773 $23,407 Price $9,573 $9,269 $22,313 $12.51 11/8/12 Value ($/share) (SMM) $20.24 Ultra-Deep Assets Trading Peers Equity Enterprise Value (1) (SMM) $8,397 $2,056 $11,661 NA $6,947 3.4x 20x 3.2x 1.9x $4,972 22x 1.7x $6,028 3.7x 2.6x EBITDAX 2.7x 2.50x $7,402 $6,487 3.6x 2.7% 2.60% 2.1x $21072 175x185x 19.6x 21.2x $8,155 $2,543 $1,238 $1,305 $5,612 $3,132 (Befe) Reserve & Production Statistics 2012E 2013E 2012E 2013E Proved Res. % Gas % Dev. LQ Prod. 2012E 2013E R/P (x) (%) (Mefed) (Mefed) (Mefed) (Years) 718 29.1% 68.3% 285,700 264,636 322,885 6.9 440 36.1% 45.8% 75,266 81,111 137,023 16.0 609 54.6% 59.8% 242,703 249,951 277,780 6.9 701 41.3% 65,5% 282,721 286,746 323,610 6.8 28 Risked (Befe) 90,825 14,065 6,120 24x 7,945 76,760 17,260 (2) (3) Resources Unrisked (Befe) 302,915 59,430 18,655 40,775 243,485 57,311 617 40.3% 59,8% 655 38,7% 209 59.7% % Gas 0% 0% 0% 0% 95% 81.8% Confidential ($ in millions) 221,597 220,611 265,324 262,712 257,293 300,332 133,809 140,369 148,635 Resource (S/Mcfe) $0.09 $0.18 $0.20 $0.16 $0.07 $0.14 Adj. Enterprise Value() Risked Source: FactSet Note: Proved Reserves as of year end 2011 (1) Cobalt value allocated by area based on the value attributed to each area by street research as a percentage of total NAV (2) Cobalt resource numbers represent the average of street research estimates (3) Oil converted to gas equivalent on an economic equivalents basis using the average NYMEX forward strip pricing for WTI Oil and HHUB gas for the next 60 months as of November 1, 2012 (19.9:1) (4) Enterprise value adjusted to remove the value of MeMo Ran's Conventional Assets EVERCORE PARTNERS Unrisked Resource ($/Mcfe) $0,03 $0.04 $0.07 $0.03 $0.02 $0.04 9.1 6.9 MOMORAD#35Preliminary Financial Analysis Peer Group Trading Analysis - Valuation Summary Metric Conventional Assets Proved Reserves (Befe) Production - 2013E (Mcfed) EBITDAX - 2012E (SMM) Ultra-Deep Assets Peer Group Trading Analysis - Valuation Summary Relevant Multiples EBITDAX 2013E (SMM) Selected Conventional Asset Value Range Net Risked Resources (Bcfe) Data (1) Based on Company provided reserve and I/B/E/S estimates EVERCORE PARTNERS 208.5 148,635 179.0 169.5 17,260 Low $2.50 / Mcfe $6,000/Mcfed 3.2x 3.0x $0.10/Mcfe Implied Equity Value High $3.50/Mcfe $6,500/Mcfed 3.8x 3.8x Implied Enterprise Value Range Add: Cash Less: Debt Less: Preferred Shares 29 $0.18/Mcfe Diluted Shares Outstanding Implied Equity Value per Share Value Range (SMM) Low $521 $892 $573 $509 $624 $1,726 $2,350 191.9 Confidential (567.8) (700.0) $1,274 163.9 $7.77 High $730 $966 $680 $644 $755 $3,107 $3,862 191.9 (300.0) 0.0 $3,754 226.8 $16.55 MCMORAD#36Preliminary Financial Analysis Precedent Transactions - Gulf of Mexico Shelf Date 18-Od-12 NGP/Northstar 26-Sep-12 Arena Energy 17-Sep-12 EPL 7-Sep-12 Renaissance 15-May-12 Energy Partners 2-Feb-12 Sand Ridge 1-Dec-11 KNOC/SCL/STX/Samchully 1-Nov-11 Apache 1-Nov-11 Energy Partners 25-Aug-11 Dynamic Offshore 29-Jul-11 Dynamic Offshore 1-May-11 Dynamic Offshore 7-Apr-11 TRT/Tana 9-Mar-11 Undisdosed Buyer 13-Jan-11 Energy Partners 21-Nov-10 Energy XXI (Bermuda) 20-Sep-10 McMo Ran 3-Nov-10 W&T Maximum Minimum Mean Median Selected Precedent Gulf of Mexico Shelf M&A Transactions Seller Undisclosed Private McMoRan Hilcorp McMoRan W&T Dynamic/Riverstone NGP/Northstar Stone Stone Moreno/SPN Exxon Mobil Gryphon/Woodside Mantech/TETRA National Fuel/Seneca Anglo-Suisse Exxon Mobil Plains Shell Trans. Reserves Value Proved Res. % Gas % Dev. (SMM) (Befe) (%) (%) $160 $37 $550 $28 $32 $1,256 $201 $38 7.8 $38 7.8 $68 21.3 $183 81.0 $28 126 $150 54.6 $70 34.4 $201 48.6 $1,012 296.7 $158(1) 60.0 54.4 $37 $1,256 $28 $240 $70 15.2 217.8 7.4 6.0 375.0 64.8 375.0 6.0 78.3 46.5 Source: IHS Herold (1) Represents 19% of the total transaction value which is the share McMoRan allocated to proved reserves EVERCORE PARTNERS 78% 22% 46% 42% 23% 49% 84% 50% 50% 4% 100% 4% 100% 35% 92% 61% 72% 88% 100% 37% 89% 74% 75% 16% 76% 39% 68% 85% 72% Production Prod. (Mcfed) 12,600 10,000 60,000 Implied Value / HHUB WTI % Gas R/P Proved Res. Production 12-Mo Strip 12-Mo Strip (%) (Years) ($/Mcfe) (S/Mcfed) (S/MMBru) ($/bbl) 70% 50% 5,760 48% 150,000 50% 28,200 30% 2,460 2,460 8,214 42,000 88% 100% 150,000 22% 2,460 4% 47% 75% 37,346 46% 76% 26,700 1% 35% 60% 28,793 18,000 120,000 47% 45,000 26,700 85% 73% 76% 85% 1% 45% 9.7 4.2 9.9 2,9 6.8 6.3 8.7 8.7 7.1 5.3 6.8 3.7 5.6 9.9 2.9 6.4 6.8 $3.60 $2.42 $2.53 $3.81 $5,40 $3.35 $3.10 $4.92 $4.92 $3.19 $2.25 $2.18 $2.75 $2.03 $3.41 $2.63 $0.67 $5.40 $0.67 $3.18 $3.15 $12,698 $3,680 $9,167 $5,621 $8,371 $7,128 $15,610 $15,610 $8,279 $4,345 $2,431 $11,150 $8,433 $3,501 $1,375 $15,610 $1,375 Confidential $7,827 $8,279 $3.91 $3.49 $3.42 $3.26 $3.02 $2.89 $3.75 $4.09 $4.09 $4.20 $4.52 $4.98 $4.57 $4.28 $4.72 $4.37 $4.44 $4.21 $4.98 $2.89 $4.01 $4.15 $94.01 $92,50 $99.87 $96.84 $95.94 $99.10 $99.69 $92.81 $92.81 $87.47 $99.76 $114.41 $110.21 $106.32 $94.89 $83.60 $79.08 $86.18 $114.41 $79.08 $95.86 $95.41 MOMORAN#37Preliminary Financial Analysis Precedent Transactions - Gulf Coast Onshore Date 12-Od-12 Texas Petr. 4-01-12 Undisdosed 19-Mar-12 Undisdosed 4-Nov-11 Undisdosed 31-Aug-11 Encore Energy Part. 17-Aug-11 EnergyQuest II 6-Jun-11 Linc Energy Ltd. 13-May-11 Undisdosed Private 3-Mar-11 Legend Nat. Gas 18-Jan-11 Gulf Coast Energy 17-Jan-11 Undisdosed Maximum Minimum Buyer Mean Median Source: IHS Herolds EVERCORE PARTNERS Seller Selected Precedent Gulf Coast Onshore M&A Transactions Forest Camzo Comstock Plains Undisdosed Swift ERG Energy XXI (Bermuda) Smith Cypress Strike Trans. Reserves Value Proved Res. % Gas % Dev. (SMM) (Befe) (%) 45.0 38% $220 $20 $123 $185 $48 $54 $236 $41 $99 $95 $22 $236 $20 $104 $95 63.2 120.0 12.6 92.2 123.0 123.0 8.3 66.3 63.2 84% 100% 17% 100% 65% 19% 6% : 31 Production Implied Value / WTI Prod. Gas R/P Proved Res. Production 12-Mo Strip 12-Mo Strip (Mcfed) (%) (Years) (S/Mcfe) ($/Mcfed) ($/MMBtu) ($/bbl) 20,000 $4.89 5,720 6.2 11,296 39,000 2,580 10,600 18,600 9,710 8,800 11,020 100% 100% 39,000 6% 19% 2,580 52% 59% 13,733 52% 59% 10,810 35% 87% 81% 100% 17% 65% 82% 65% 91% 100% 73% 15.3 8.4 13.4 23,8 18.1 23.8 6.2 14.2 14.4 $1.95 $1.54 $3.78 $0.58 $1.92 $2.63 $4.89 $0.58 $2.47 $1.95 $11,000 $3,409 $10,889 $4,744 $18,450 $5,047 $12,688 $4,222 $11,273 $8,621 $18,450 $3,409 $9,034 $9,755 HHUB $3.97 $3.77 $2.92 $3.96 $4.29 $4.31 $4.93 $4.57 Confidential $4.25 $4,73 $4.71 $4.93 $2.92 $4.22 $4.29 $93.91 $89.73 $108.62 $93.30 $90.64 $88.50 $102.35 $100,07 $104.61 $94.51 $95.10 $108.62 $88.50 $96.48 $94.51 MOMORan#38Preliminary Financial Analysis Precedent Transactions - GOM Deepwater (Non-Proved) and Ultra-Deep Shelf Date Maximum Minimum Mean Median Buyer 2-Jul-12 INPEX Anadarko 1-Oct-10 Hess BP 22-Dec-09 Maersk/Various Devon Date GOM Deepwater (Net Recoverable Resources) Implied Value / Resources Net Recoverable Resources (Bcfe) ($/Mcfe) $4.29 $0.28 $0.79 Buyer Seller Seller Trans. Net Recoverable Value (SMM) 20-Sep-10 McMoRan Plains $6720) 8-Sep-11 McMoran Whitney $49 $556 $40 $1,300 $1,300 $40 $632 $556 129.6 144.0 1,645.0 (Tcfe) 6.6 0.1 1,645.0 129.6 639.5 144.0 $4.29 $0.28 Source: IHS Hecolds (1) Represents 81% of the total transaction value which is the share MeMo Ran allocated to unevaluated oil and gas property EVERCORE PARTNERS 32 $1.79 $0.79 Ultra-Deep Shelf (Net Unrisked Potential) Trans. Ultra-Deep Net Transaction Value / HHUB Value Unrisked Potential Ultra-Deep Net Unrisked Potential 12-Mo Strip (SMM) ($/MMBtu) $4.44 $4.33 HHUB WTI 12-Mo Strip 12-Mo Strip (S/MMBtu) ($/bbl) $3.29 $87.14 $4.28 $83.28 $5.90 $76.43 ($/Mcfe) $0.10 $0.57 $5.90 $3.29 $4.49 $4.28 $87.14 $76.43 $82.28 $83.28 WTI 12-Mo Strip ($/bbl) $79.08 $90.18 Confidential MOMORAL#39Preliminary Financial Analysis Precedent Transactions - Ultra-Deep Shelf Value Prospect Offshore Davy Jones Blackbeard East Lafitte Blackbeard West Offshore Discoveries Total England Barbosa Morgan Barataria Blackbeard West #3 Drake Davy Jones West Hurricane Hook Captain Blood Bonnet Queen Anne's Revenge Calico Jack Offshore Prospects Total Onshore Highlander Lineham Tortuga Onshore Total Total Ultra-Deep Category WI Ultra-Deep Shelf Valuation Precedent Transactions Gross Unrisked Net Unrisked NRI Resource Potential Resource Potential % Gross Risked Net Risked Resource Potential Resource Potential Discovery 63.4% 50.2% Discovery 72.0% 57.4% Discovery 72.0% 58.3% Discovery 69.4% 53,1% Prospect 36.0% 28.8% Prospect 72.0% 57.6% Prospect 72.0% 57.6% Prospect 72.0% 57.6% Prospect 69.4% 55.5% Prospect 72.0% 57.6% Prospect 36.0% 28.8% Prosped 72.0% 57.6% Prosped 72.0% 57.6% Prospect 72.0% 57.6% 72.0% 57.6% Prospect Prospect 72.0% 57.6% Prospec 36.0% 28.8% Near Term Drill 72.0% 57.6% Drilling 36.0% 28.8% Prosped 72.0% 57.6% EVERCORE PARTNERS Befe 3,248 1,040 804 7,434 27,300 2,588 1,000 2,820 498 14,580 1,400 1,575 4,890 18,000 3,150 1,296 7,000 86,097 13,300 10,800 5,590 29,690 123,221 Befe 1,631 597 1,365 427 4,020 7,862 1,491 576 1,624 276 8,398 403 907 2,817 10,368 1,814 746 2,016 39,300 7,661 3,110 3,2230 13,991 57,311 33 Befe 2,321 737 1,601 592 5,252 7,487 721 281 776 288 3,765 391 446 1,257 4,957 788 336 1,931 23,424 3,578 2,976 1,465 8,020 36,696 Befe 1,165 $ 0.50 $ 0.60 423 $ 0.25 $ 0.50 933 $ 0.25 $ 0.50 315 $ 0.25 $ 0.50 2,836 2,156 415 $ $ 162 $ 447 $ Metric Used Low High $/Mcfe $/Mcfe 160 $ 2,169 $ 113 $ 257 $ 724 $ 2,855 $ 454 $ 194 $ 556 $ 10,661 2,061 857 844 3,762 17,260 $ $ $ 0.10 $ 0.15 0.10 $ 0.10 $ 0.10 $ 0.10 $ 0.10 $ 0.10 $ 0.10 $ 0.10 $ 0.10 $ 0.10 $ 0.10 $ 0.10 $ 0.10 $ 0.10 $ 0.10 $ 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 0.15 Confidential Implied Valuation Low SMM $583 106 233 79 $1,000 $216 42 16 45 16 217 11 72 286 45 19 56 $1,066 $206 86 84 $376 $2,443 High SMM $699 211 467 157 $1,535 $323 62 24 24 325 17 39 109 428 68 29 83 $1,599 $309 129 127 $564 $3,698 MOMORAN#40Preliminary Financial Analysis Precedent Transactions - Valuation Summary Metric Gulf of Mexico Shelf Proved Reserves (Befe) Production - Current (Mcfed) Selected Gulf of Mexico Shelf Value Range Gulf Coast Onshore Proved Reserves (Befe) Production - Current (Mcfed) Selected Gulf Coast Onshore Value Range Total Conventional Asset Value Range Ultra-Deep Assets Net Risked Resources (Befe) Precedent Asset Transactions - Valuation Summary EVERCORE PARTNERS Data 183.8 103,211 24.7 30,598 17,260 Relevant Multiples Low $2.50 / Mcfe $5,000 / Mcfed $2.50 / Mcfe $3,500/Mcfed High $3.50 / Mafe $7,000/ Mcfed Implied Equity Value $3.75 / Mafe $5,000/ Mcfed Various (See Previous Page) Implied Enterprise Value Range Add: Cash Less: Debt Less: Preferred Shares Diluted Shares Outstanding Implied Equity Value per Share 34 Value Range (SMM) Low High $460 $516 $488 $62 $107 $84 $572 $2,443 Confidential $3,015 191.9 (567.8) (700.0) $1,939 164.3 $11.80 $643 $722 $683 $93 $153 $123 $806 $3,698 $4,504 191.9 (300.0) 0.0 $4,396 228.8 $19.21 MCMORAR#41Preliminary Financial Analysis Precedent M&A Transactions - Corporate Date Buyer 25-Apr-12 Halmon 170-11 Statoil ASA 15-Jul-11 BHP Billiton 9-Nov-10 Chevron Seller GeoResounts Boghan Exploration Petrohrak Atlas Energy 2-Jun-10 SandRidge Energy Arena Resouras 15-Apr-10 Apache 14-Dec 09 Exxon Mobil 1-Nov-09 Denbury Resouras 27 Apr 09 Atlas Energy, Inc. 30-Apr-08 Stone Enegry 17-Jul 07 Plains E&P 7-Jan-07 Port Ol 23-Jun-06 Analado 23 Jun 06 Anadarko 21-Apr-06 Petrohuwk 23-Jan 06 Helix 12-Dec 05 Conom Phillips Mariner Energy XTO Enoose Acquisition Co. Adas Energy Resou Bois d'Arc Energy Pogo Producing Co. Houston Exploution Westen Gas Res. Kem McGee KCS Enagy Remington Budington Resources 13-04-05 Oasdental Petroleum Vintage Petroleum 19 Sep 05 Nok Hydro ASA Spinnaker Exploration Max Mean Median Min Tram. Equity Equity Value/ Transaction Value/ Value Value Cash Flow Cash Flow EBITDA EBITDA Proved Res Prod. (SMM) (SMM) Current Forward Current Forward (S/Mcle) (S/Meled) (9 61 $945 $973 $4,822 $4,468 $15,223 $12,085 $4,315 $3,215 $1,287 $1,394 $4,685 $2,770 $49,976 $31.254 $4,465 $2861 $1,015 $482 $1,750 $1,736 $3,749 $3,994 $1,827 $1.574 $5,385 $4,800 $19,623 $16.500 $2008 $1.630 $1,312 $1,385 $36,400 $34,639 $4,119 $3,539 $2,992 $2,996 840,4% 88,212 $4,119 Source: IHS Herold, FactSet Note: Only includes transactions greater than $100 million EVERCORE PARTNERS 14,7x 10.1x 18.1x 5.3x 5.3x 5.4x 5.5x 42x 5.5% 7.9% 82x 18. Ix 7% 7.38 15.3x 500% 6.3x 3,6% 4,7% 4,7x 66€ 15.2x 68 15 5,9% 10,7x 5.6% 10.6% 7.3x 5.8 60% 70x 17.4x 7.0% 7.68 15.68 5.7x 6.6% 8.8 5.2x 3.8x 9.0% 5.7% 49% 4.4x 5.3x 6.1x 15. fex 6.4x 5.7x 35 Premium 1 Day 1-Mo. 2-Mo. $4.97 $18,175 $1203 $47,837 200% 26% 11% $275 $11,274 65% 49% 46% $1.73 $17,008 49% $3,05 $25,728 7% $33.13 $10,944 68% $1.92 $9,797 25% 24% 30% $2.72 $13,256 35% $1.16 $4,48 $2,48 $14,827 $13,068 (4%) $11,095 18% $7,844 8% 38% (5%) 21% 32% 11% 19% $2.90 $13,563 49% $3.14 $11,450 $3.54 $10,822 20% 16% $14,622 $1.29 23% $11,173 $2.58 $1.38 $7,929 $6.04 $15,847 49% 51% 15% 27% 20% $12.03 $47,837 $3.53 $15,098 26% 29% $2.90 $13,068 21% 26% 26% $7,844 (45) (7) (5%) 92% Reserve & Production Statistics Proved Res. % Gas Dev. R/P (Befe) (9) HHUB WTI Spot Price Spot Price () (Years) (S/MMB) (5/bbl) 70% 124 $1.97 $103.16 35% 10.9 86.80 35% 3.49 11.2 4.42 95.69 3.49 4.39 4.15 400.8 22% 3,391.5 92% 847.0 99% 4155 1,087.1 53% 14,827.3 84% 1,321.7 33% 5176 99% 60% 335.0 57% 1,3140 65% 699.3 96% 920.8 97% 5.388.0 62% 4630 88% 278.9 60 12484.2 68% 26232 32% 3736 47% 14,827 99 2,520 63% 847 62% 190 1 66% 73% 57% 67% 80%. 38% 61% 34% 9.6 14,0 13,4 80 122 89 128 10.0 8,4 9.3 11.8 15.7 Confidential 27.9 1.3.4 11.8 72 10.94 6.32 5.52 6.51 6.51 7.93 8.78 15.02 1368 $15.00 6.68 5.32 1.97 72.58 85.84 69.87 77.00 50.80 115.63 74.15 70.49 71.95 6835 99.39 64.12 63.00 8115.63 75.93 71.95 50.80 MOMORAR#42Preliminary Financial Analysis Precedent M&A Transactions - Valuation Summary Metric Cash Flow-2012E (SMM) Cash Flow - 2013E (SMM) EBITDAX-2012E ($MM) EBITDAX 2013E ($MM) Proved Reserves (Bafe) Production - 2013E (Mcfed) (1) Estimates as per MMR Operating Model EVERCORE PARTNERS Precedent Corporate Transactions - Valuation Summary Data 94.5 121.0 175.4 177.0 208.5 138,809 Low 14.5x 10.0x 14.58 12.0x Relevant Multiples $8.00 / Mofe $20,000/ Mcfed Implied Equity Value Implied Enterprise Value Range Add: Cash Less: Debt Less: Preferred Shares 36 High Diluted Shares Outstanding Implied Equity Value per Share 18.0x 15.0x 17.0x $12.00 / Mcfe 15.5x $25,000/Mcfed Value Range ($MM) Low High $2,463 $2,300 $2,543 $2,124 $1,668 $2,776 Confidential $2,312 191.9 (567.8) (700.0) $1,236 163.8 $7.55 $2,800 $2,917 $2,982 $2,743 $2,502 $3,470 $2,902 191.9 (567.8) (700.0) $1,826 164.2 $11.12 MOMORAN#43Preliminary Financial Analysis Precedent M&A Transactions - Corporate Takeover Premiums - 100% Cash Consideration Transaction Acquiror Value (SMM) $2,213 1,196 1,939 1,609 1,819 Date Announced 11/1/12 10/30/12 10/25/12 10/22/12 10/18/12 10/11/12 10/8/12 9/27/12 9/13/12 9/6/12 9/3/12 8/27/12 8/27/12 8/26/12 8/22/12 8/20/12 8/13/12 8/9/12 8/6/12 7/9/12 6/29/12 3/12/12 2/21/12 2/16/12 JDA Software Group Inc. Schiff Nutrition International Inc. PSS World Medical Inc. Ancestry.com Inc. Target Orient Express Hotels Ltd. Oshkosh Corporation TPC Group Inc Sealy Corporation Citizens Republic Bancorp, Inc. American Realty Capital Trust, Inc. Medicis Pharmaceutical Corp. Kenexa Corp. TPC Group Inc. Dollar Thrifty Automotive Group Inc. Sunrise Senior Living Inc. Coventry Health Care Inc. Focus Media Holding Ltd. Robbins & Myers Inc. Best Buy Co. Inc. AMERIGROUP Corporation Elster Group SE Pacific Capital Bancorp CH Energy Group Inc. CVR Energy, Inc. RedPrairie Corporation Bayer HealthCare, LLC McKesson Corporation Permira/Spectrum The Indian Hotels Company Limited Cad C. Icahn Innospec Inc. Tempur-Pedic Intemational Inc. FirstMerit Corporation Realty Income Corp. Valeant Pharmaceuticals International, Inc. IBM First Reserve/SK Capital Partners Hertz Global Holdings, Inc. Health Care REIT, Inc. Aetna Inc. The Carlyle Group National Olwell Varco, Inc. Richard Schulze WellPoint Inc. Melrose PLC UnionBanCal Corporation Fortis Inc. Icahn Enterprises Holdings L.P Mean Median Metric 1 Day Premium 5 Day Premium 1 Month Premium Metric $12.51 $12.51 $12.51 Source: Capital IQ Note: Includes public corporate takeover transactions announced or closed in 2012 YTD between $1.0 billion and $100 billion. EVERCORE PARTNERS 37 3,636 1,069 1,018 1,025 2,882 3,158 1,397 1,001 4,147 1,469 7,311 3,688 2,570 9,875 5,104 2,881 1,525 1,500 3,231 Selected Valuation Range Low 20.0% 25.0% 30.0% Relevant Multiples High 30.0% 35.0% 40.0% Implied Equity Value Range 1 Day 18.0% 96.9% 9,7% 40.0% 21.0% 13.1% 2.8% 18.3% 2.1% 42.0% 1.0% 8,0% 62.4% 20.4% 15.5% 28.2% 47.4% 43.0% 5.8% 60.3% 10.6% 8.7% 27.0% 19.4% Premiums 5 Day Confidential $15.01 $15.64 $16.26 $15.64 32.6% 96.1% 31.3% 11.8% 46.0% 15.7% 12.0% 7.8% 15.0% 3.8% 38.0% (0.5%) 11.0% 73.9% 30.3% 28.1% 35,0% 44.0% 40.6% 8.8% 60.2% 12.4% 6.7% 29.0% 29.2% 1 Month 39.2% 88.7% 25.8% 3.3% 32.8% 21.5% 8.6% 17.8% 8.9% 31.0% 86.7% 0.0% 15.2% 117.7% 31.0% 38.5% 43,7% 20.4% Value Range (SMM) Low High 46.0% 61.3% 15.5% 27.7% 36.2% 31.0% $16.26 $16.89 $17.51 $16.89 MOMORAN#44Preliminary Financial Analysis Discounted Cash Flow Analysis Adjusted EBITDA Less: DD&A EBIT Less: Taxes @ 35.0% EBIAT Plus: DD&A Less: Growth Capital Expenditures Less: Sustaining Capital Expenditures Unlevered FCF Terminal Value Multiple/Growth Rate PV of Terminal Value @ 10.0% Plus: Present Value of Unlevered FCF Plus: PV of 0.5x 2017E NOL @ 10.0% Implied Enterprise Value WACC 9.0% 10.0% 11.0% 12.0% 13.0% 4.0x $4,422 4,025 3,689 3,397 3,141 EVERCORE PARTNERS EBITDA Multiple Sensitivity EBITDA Multiple 5.0x $5,218 4,774 4,393 4.5x $4,820 4,400 4,041 3,729 3,454 2013E 4,061 3,767 $177 (841) (664) (664) 841 (500) ($323.0) 5.5x $5,616 5,148 4,745 4,393 Summary Results For the Years Ending December 31, 2014E 2015E 2016E $438 (1,549) (1,111) (1,111) 1,549 (749) ($310.7) 6.0x $6,015 5,523 5,098 4,725 4,393 38 $727 (1,292) (565) (565) 1,292 (551) $176.2 WACC 9.0% 10.0% 11.0% 12.0% 13.0% $966 (1,071) (105) (105) 1,071 (489) $477.6 (0.5%) $6,372 5,465 4,731 2017E 4,126 3,621 $1,138 (906) 232 232 906 (493) $645.1 0.0% $6,702 5,720 4,932 Terminal Value 4,287 3,752 EBITDA Exit Multiple $1,138 5,0x $3,272 $4,774 865 637 4,462 3,894 Perpetuity Growth Rate Perpetuity Growth Rate Sensitivity Perpetuity Growth Rate 0.5% $7,071 6,002 5,152 Confidential 1.0% $7.486 6,315 5,394 $1,138 4,653 4,047 $1,137.6 (398.1) $739.4 $739.4 $6,002 0.5% $4,500 1.5% $7,956 6,665 5,661 4,862 4,214 McMoRan#45Appendix EVERCORE PARTNERS#46Appendix Weighted Average Cost of Capital Equity Cost of Capital WACC Company McMoRan Exploration Co. W&T Offshore Inc. Energy XXI (Bermuda) Ltd. Stone Energy Corp. Cobalt International Energy Inc. EPI. Oil & Gas Inc. (3) (4) Source: Bloomberg Risk-Free Rate Unlevered Beta Debe and Preferred / Total Capitalization Adjusted Equity Beta Market Risk Premium Equity Cost of Capital Weighted Average Cost of Capital - CAPM Stock Prices as of 11/8/12 Market Equity Value Pre-Tax Cost of Debt After-Tax Cost of Debt WACC (1) Source: Predicted raw betas from FactSet Adjusted Equity Beta calculated as: (067) Raw Beta +(0.33) 1.0 Unlevered Beta calculated as Adjusted Equity Betax (E/E+D (1- T) Assumes corporate tax rate of 37.50% 10-year Treasury as of November 8, 2012 (5) Equity Cost of Capital calculated as Risk-free rate+ (Levered Equity Betax Market Risk Premium) EVERCORE PARTNERS MMR $12.51 42.29 61.25 4.2 88.34 116.81 0.97 38.1% 1.35 8.7% 7,5% 4.7% 10.1% 39 $2,056.1 5,011 9,163 216 9,365 32,343 Comparable Companies 1.32 19.9% 1.52 8,7% 15.0% 7.5% 4.7% 12.9% Total Debt and Preferred Stock $1.268 Mean Median ($ in millions, except per share amounts) 1,420 2,737 3 2.523 5,012 Debt & Preferred/ Total Cap 38.1% 22.1% 23.0% 1.4% 21.2% 13.4% 19.9% 21.7% Confidential Adjusted Beta 1.35 1.67 1.48 1.57 1.69 1.38 1.52 1.53 Unlevered Beta 0.97 1.42 1.25 1.56 1.45 1.26 1.32 1.34 MCMoRan#47Appendix Ultra Deep Development Profile - Unrisked Net Production Free Cash Flow (SMM) Production (MMcfed) 3,000 2,500 2,000 1,500 1,000 500 $4,000 $3,000 $2,000 $1,000 $0 ($1,000) 2012E actez 2012E 2014E 2015E- 2016E- 2017E 2018E 2019E 2020E 2013E Discoveries Prospects 2014E 2015E EVERCORE PARTNERS •81262 2022E- 2023E- 2024E 2025E 2026E- 2027E 2028E- 2029E- 2030E- 2031E- 2032E 2016E Price Deck (11/1/12) NYMEX Strip (11/1/12) $75.00 Oil / $3.00 Gas $90.00 Oil/ $4.00 Gas $105.00 Oil / $5.00 Gas 2017E 2018E Net Opertaing Income Free Cash Flow (SMM) / Pre-Tax Net Present Value (SMM) 2019E 2020E NOI and Capex (SMM) 2021E $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0 ($1,000) ($2,000) ($3,000) Discoveries Prospects 40 2022E Net Operating Income (SMM) 2023E Z 2012E 2013E 2014E 2015E 2016E 2017E 2018E 2019E 2020E 2021E 2022E 2023E 2024E 2025E 2026E 2027E 2028E 2029E 2030E 2031E 2032E 2024E 2025E 3,283 5,919 2026E Capex 2027E 2028E Discount Rate 8.0% 9.0% 10.0% 11.0% 12.0% ($542) 15.0% 20.0% 30.0% 40.0% $15,874 $13,009 $10,772 $8,991 $7,552 $4,575 $1,981 $39 5,981 4,588 3,514 (1,095) (1,168) 12,609 10,232 8,379 19,238 15,875 13,244 648 (442) 2,670 1,998 6,908 5,723 11,147 9,447 1,187 (330) 2,815 436 (319) 2029E Confidential 2030E $180,000 $150,000 $120,000 $90,000 $60,000 $30,000 50 Cumulative Free Cash Flow ($30,000) Cumulative Free Cash Flow ($MM) ($60,000) ($90,000) 2031E 2032E MCMoRan