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What: McMoRan Exploration
So what: McMoRan expects to find large, accessible oil reserves in areas where it has acquired drilling rights beneath the Gulf of Mexico. That optimism overshadowed news that the company determined one of its evaluation wells is not commercially viable, which will result in a $37 million charge this quarter.
Now what: The energy exploration company has been purchasing drilling rights below shallow water, where drilling is less risky. Preliminary tests indicate these areas may hold "large accumulations" of oil and natural gas, according to management. McMoRan plans to continue drilling and conducting tests to assess the areas' potential. In the meantime, investors may want to explore other stocks: This company hasn't had a profitable quarter since the second quarter of 2008, and the consensus estimate calls for losses through the fourth quarter of 2012.
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