The former stand-alone segment is to be restructured as an operating division of its parent company, resulting in the elimination of several executive management roles and the integration of FM O&G’s financial and administrative roles with Freeport-McMoRan’s corporate functions.
The reorganization is an effort to reduce costs, streamline functions, and enhance capital allocation across its global business, Freeport-McMoRan Inc. said in a statement. The company also said that further steps will be taken to reduce costs and capital expenditures, and that it will “continue to evaluate potential transactions for the sale of certain assets of FM O&G.”
Reports that the mining and natural resources conglomerate would exit oil and gas altogether have persisted since 4Q 2015, just a few years after it entered the industry in 2013 with the acquisition of Plains Exploration & Production Co. and McMoRan Exploration Co.
In October, the company announced that it was reviewing its oil and gas business, and cut its board of directors from 16 members to nine. In December 2015, it was reported that the company would auction off the majority of assets over the course of 2016.
However, on March 30, it was reported that the ultra-deepwater Noble Tom Madden drillship would return to work for FM O&G in the Gulf of Mexico after it had been laid-up earlier this year.
Mark Kidder, formerly vice president – Operations, will lead FM O&G’s operating team as executive vice president – Operations.
FM O&G CEO Jim Flores; President and COO Doss Bourgeois; Executive Vice President and CFO Winston Talbert; and Executive Vice President and General Counsel John Wombwell are departing. This team has served as executive management for the FM O&G organization since FCX’s acquisition of Plains Exploration Co. in 2013.
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