McMoRan Exploration Co.'s third-quarter loss widened as the natural-gas exploration company's average daily production fell short of its prior guidance, partly due to Hurricane Isaac.
McMoRan, which operates some of the deepest wells in the world, has seen declining revenue in recent quarters amid falling natural gas prices and lower volumes. The company has recently emphasized its Davy Jones project--a 20,000-acre ultradeep reservoir in the shallow waters of the Gulf of Mexico--which McMoRan has said could be one of the largest on the Gulf's shelf in decades. The company has successfully drilled two subsalt wells at the field and investors have been eagerly awaiting indications of how they will perform.
The company said Friday the Davy Jones No. 1 well was successfully cleaned out and it is preparing to re-install production tubing before flow testing the well.
McMoRan reported a loss of $64 million, or 40 cents a share, compared with a loss of $9.42 million, or 6 cents, a year earlier. The loss from continuing operations was 39 cents a share, compared with 5 cents a year ago. Revenue dropped 34% to $91.8 million.
Analysts polled by Thomson Reuters had most recently forecast a per-share loss of 13 cents on revenue of $86 million.
Operating margin swung to negative 51.4% from positive 2.1%.
Daily production averaged 134 million cubic feet of natural gas equivalents, down from 187 million a year earlier. Its July projection was for average production of 135 million cubic feet per day. McMoRan said its production reflected unplanned downtime associated with Hurricane Isaac.
For the fourth quarter, the company expects daily production to average 120 million cubic feet.
Copyright (c) 2012 Dow Jones & Company, Inc.
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