Freeport-mcmoran, Inc. · NYSE:FCX

Freeport-mcmoran — Cowen and Company Energy & Natural Resources Conference 2016

16 slides from Freeport-mcmoran's conference presentation, Dec 6, 2016

  1. Slide 1: Richard C. Adkerson, President & CEO

    Richard C. Adkerson President & CEO December 6, 2016

  2. Slide 2: Cautionary Statement Regarding Forward-Looking Statements

    Cautionary Statement Regarding Forward-Looking Statements This presentation contains forward-looking statements in which FCX discusses its potential future performance. Forward-looking statements are all statements other than statements of historical facts, such as projections or expectations relati

  3. Slide 3: "Proving Our Mettle"

    “Proving Our Mettle” met·tle /ˈmedl/ n: 1. a person’s ability to cope well with difficulties or to face a demanding situation in a spirited and resilient way.  Executing Clearly Defined Strategy  Maintaining Cost Focus and Capital Discipline  Strengthening Balance Sheet  Industry Leading Copper

  4. Slide 4: World-Class Copper Portfolio

    World-Class Copper Portfolio Long-term Value in High Quality Asset Base Cu Reserves: 32 bn lbs Cu Reserves: 31 bn lbs Cu Reserves: 28 bn lbs Mo Reserves: 2.4 bn lbs Mo Reserves: 0.7 bn lbs Au Reserves: 27 mm ozs Mineralized Mat.: 46 bn lbs Mineralized Mat.: 24 bn lbs Mineralized Mat.: 21 bn lbs Impl

  5. Slide 5: World's Leading Copper Producers

    World’s Leading Copper Producers Top 10 Copper Producers (2016) (000 t) 2,000 1,500 1,000 500 0 FCX Codelco Glencore BHP Southern KGHM Rio Tinto First Antofagasta Anglo Copper Quantum American Source: Wood Mackenzie September 26, 2016. Rankings based on net equity ownership. 5

  6. Slide 6: Copper Market Commentary

    Copper Market Commentary  Significance of China and Global Economy on Demand  Projected Surpluses Continue to be Lower Than Expected  Recent Supply Growth Unsustainable  Prolonged Period of Low Prices Will Impact Future Supplies  Relatively Low Inventories  Improved Market Sentiment Consistent

  7. Slide 7: World Class Copper Discoveries Are Extremely Rare

    World Class Copper Discoveries Are Extremely Rare Recoverable Copper Reserves 2016e Copper Production Million metric tons Thousand metric tons 0 5 10 15 20 25 30 35 0 200 400 600 800 1000 1200 1981 Escondida - 1981 Escondida - 1981 1880 Collahuasi - 1880 Grasberg Complex - 1988 1988 Grasberg Complex

  8. Slide 8: FCX Reserves/Mineralized Material/Resources

    FCX Reserves/Mineralized Material/Resources as of 12/31/15, Adjusted for 2016 Asset Sales 2P Reserves (1) Mineralized Material (2) Resources (3) North North America America North 35% 51% America South 67% America Indonesia Serbia Indonesia South 34% 23% 18% South 31% America America 26% 15% 90 Billi

  9. Slide 9: Large Development Project Inventory: Copper Sulfide Opportunities

    Large Development Project Inventory Copper Sulfide Opportunities 1 km % Copper N >=0.00% >=0.10% • Bagdad >=0.20% >=0.30% Reserve Pit >=0.40% >=0.60% >=0.80% >=1.00% • Chino +0.3% Cu • El Abra • Lone Star/Safford 1 km N Reserve Pit • Morenci % Copper >=0.00% • Sierrita >=0.20% >=0.30% >=0.40% >=0.50

  10. Slide 10: Tracking Our Achievements

    Tracking Our Achievements Declining Unit Costs for Copper • $6.6 Billion in Announced Asset Sales $1.74 -20% Decline − $5.2 Billion Expected to Close in 4Q16 $1.39 − No Additional Sales Required $1.52 Net Unit Cash − Retention of High-Quality Copper Portfolio Costs (after by-product) $1.14 $/lb • Cl

  11. Slide 11: Restoring Balance Sheet Strength

    Restoring Balance Sheet Strength Year-End 2017e Net Debt at Varying Copper Prices (1) (US$ billions) $20.2 $20.0 $17.9 $15.0 $10.7 $10.0 $9.5 $8.4 $5.0 $0.0 12/31/2015 9/30/2016 $2.00 $2.25 $2.50 Net Debt/2017e EBITDA 2.2x 1.6x 1.2x YE 2017e (1) Includes asset sale proceeds from the Tenke, Deepwater

  12. Slide 12: Grasberg Operations & Regulatory Matters

    Grasberg Operations & Regulatory Matters Operations  Lower 3Q16 Mining Rate in Open Pit Grasberg Open Pit Ore Grades - July Estimate: 200K t/d - Actual: 171K t/d 1.5  10-day Work Stoppage in Late Sept. 1.0 Continuing Labor Productivity Issues Affects Timing of Access to Higher Grade Ore. 0.5  201

  13. Slide 13: Grasberg Minerals District

    Grasberg Minerals District PT-FI Share of Plan SalesView Copper Gold (bns lbs) (mms ozs) Grasberg & Kucing Liar Grasberg 2016e 1.2 1.24 open pit 2017e 1.45 2.75 DMLZ 2018e 1.0 1.4 Big 2019e – 1.2 1.5 Gossan DOZ 2022e Avg. Grasberg DMLZ & Grasberg BC Reserves* Kucing Block Cave Grasberg Liar Amole (a

  14. Slide 14: 2017e EBITDA and Cash Flow at Various Copper Prices

    2017e EBITDA and Cash Flow at Various Copper Prices EBITDA ($1,250/oz Gold, $7/lb Molybdenum)* Each 10¢ change in copper = $410 mm $8 (US$ billions) $6 $4 $2 2017e $0 Cu $2.00/lb Cu $2.25/lb Cu $2.50/lb Operating Cash Flow (excluding Working Capital changes) ($1,250/oz Gold, $7/lb Molybdenum)* $6 (U

  15. Slide 15: Committed to Balance Sheet Management – Strong Track Record

    Committed to Balance Sheet Management – Strong Track Record (US$ billions) Manageable Near-Term Debt Maturity Schedule Pro Forma for Asset Sale Transactions* $4 FCX Debt Structure $3.3 bn of Pro Forma Cash Including Asset Sale Transactions Pro Forma for Asset Sale $3 12/31/15 9/30/16 Transactions $3

  16. Slide 16: Focused on Execution

    Focused on Execution Cost, Capital & Production Performance Safety & Securing Long- Environmental Term Rights in Management Indonesia Building Long- Term Value Debt Reduction Strong Track Record 16

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