FCX Freeport McMoRan Inc

Freeport-McMoRan Copper & Gold Inc.'s (FCX) acquisition of energy companies McMoRan Exploration Co. (MMR) and Plains Exploration & Production Co. (PXP) won't be a diversion from the company's copper business, Freeport's chief executive said Wednesday.

"This is an addition to our mining business and not a diversion from the strategy that we've been on," President and CEO Richard Adkerson said on a company conference call.

Freeport has agreed to buy the two oil and natural gas companies for about $9 billion.

The acquisitions will shift Freeport from purely a mining business to a company where 25% of the business comes from oil and gas, Mr. Adkerson said.

The new energy assets are "consistent in characteristics" with Freeport's existing copper and gold assets, meaning they are high-quality reserves, with a long projected life of operations, the possibility of expansion and low operating costs, he said.

Growth in Freeport's copper investments was limited by the time required to turn copper resources into operating mines, Mr. Adkerson said.

Freeport's board and management team has a bullish view on future demand for commodities and brings past experience in the energy market to the combined company, he said.

"We understand that marketplace and the risk and reward associated with it," Mr. Adkerson said.

Freeport said it will pay about $6.9 billion in cash and stock for Plains and acquire McMoRan Exploration for $2.1 billion in cash net of the 36% of McMoRan assets currently owned by Freeport and Plains.

Freeport Chairman Jim-Bob Moffett said the combined company won't be limited by looking for new investments solely in the mining or the oil sector following the acquisitions.

Moreover, geographical and political risk won't dissuade the new company from searching for the next major copper find like Freeport's Grasberg copper mine in Indonesia, the world's third-largest open pit copper mine, Mr. Moffett said.

"If we see another Grabsberg opportunity, we're not going to be worried about where it is, we're going to go after it," he said.

"We know how to swing for the fences," he said. "When you look at our record, we're home-run hitters."

Mr. Moffett is one of Freeport McMoRan founders and is also co-chairman and chief executive of McMoRan Exploration.

Freeport got into the oil and gas business in the 1970s but sold many of its assets in that sector in the early 1990s to help fund development of big new copper and gold discoveries in Indonesia. The predecessor of what is now McMoRan Exploration was spun off in 1994, with an aim to focus on Gulf of Mexico drilling.

News of Freeport's interest in McMoRan Exploration was earlier reported by the Financial Times.

Write to Tatyana Shumsky at tatyana.shumsky@dowjones.com

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