McMoRan Exploration Co. (NYSE: MMR) is seeing almost a 100% above-normal trading volume in its shares today, but the real news is in the stock options trading volume today.  The headlines were a bit misleading

The WSJ noted in its “movers” section that it “hasn’t been able to clear the blockage in the C section of drilling at the Wilcox play in the Gulf of Mexico, so it will remove tubing and clear residual draining fluid as part of an effort to provide access to all 200 net feet of the shallow-water location.”  The problems with this well have knocked out about one-fourth of the share value in recent weeks.

The company’s press release noted. “Technical completion has been achieved successfully and work is ongoing to establish commercial production from the well.”  By the company’s count, this well will be in the commercialization stage soon.

While the stock is down 3.9% at $9.34 and while the 4.7 million shares compares to an average of almost 2.8 million shares in a day, it is the options which really stand out:

• Over 5,200 of the APRIL-2012 $10 Calls have traded against an open interest of 9.239 contracts;
• Over 1,000 of the $11 and $12 Calls in April have traded in each contract;
• Over 14,000 of the April $10 Puts have traded against an open interest of 47,634 contracts;
• Over 5,300 of the $11 April Puts have traded against an open interest of 12,704 contracts.

Trading remains elevated even out in the May-2012 options, and there have been over 10,200 of the $10 Puts due in May against a prior open interest of 5,615 contracts for that same strike and month.

After having hit a low of $8.89 earlier this morning, the 52-week trading range is $8.25 to $19.26.

JON C. OGG

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