Freeport-mcmoran, Inc. · NYSE:FCX

Freeport-mcmoran — Freeport-McMoRan Copper & Gold — RBC Capital Markets Conference 2011

25 slides from Freeport-mcmoran's conference presentation, Jun 22, 2011

  1. Slide 1: Connecting the World

    Connecting the World Kathleen at ee L. Quirk Qu Executive Vice President & CFO www.fcx.com June 22, 2011

  2. Slide 2: Cautionary Statement

    Cautionary Statement This presentation contains forward-looking statements in which we discuss factors we believe may affect our potential performance in the future. Forward-looking statements are all statements other than statements of historical facts, such as statements regarding projected ore gr

  3. Slide 3: 2010 Annual Report Highlights

    “Connecting Connecting the World World” 2010 Annual Report Highlights  Global Leader in Production of Copper, Gold and Molybdenum  Well Situated to Meet Growing Demand for Metals  Geographically Diverse  Long-Lived Reserves  Growing Production Profile  Strong Financial Position  Experienced T

  4. Slide 4: FCX's Global Footprint

    FCX’ss Global Footprint FCX Major Mine Operations & Development Projects All major assets majority-controlled and operated North America1 Copper Reserves Copper/Gold/Silver Cu 42.2 billion lbs Mo 2.75 billion lbs Molybdenum Sales Cobalt Grasberg (90.64%) Cu 1.2 billion lbs Reserves Mo 73 million lbs

  5. Slide 5: World's Leading Copper Producers

    World’s Leading g Copper pp Producers Top 10 Copper Producers (2011e) (000 t) 2,000 1,800 1,600 1,400 1,200 1,000 800 600 400 200 0 Codelco FCX BHP Billiton Xstrata Anglo Southern Rio Tinto Antofagasta KGHM RAO Norilsk American Copper ____________________ Source: Brook Hunt 1Q11 Report. Rankings bas

  6. Slide 6: World Class Copper Discoveries Are Extremely Rare

    World Class Copper Discoveries Are Extremely Rare Recoverable Copper Reserves 2011e Copper Production Million metric tons Thousand metric tons 0 5 10 15 20 25 0 200 400 600 800 1,000 1,200 Grasberg Complex - 1988 Escondida - 1979 KGHM Polish Copper - 1957 Chuquicamata - 1910 Escondida - 1979 Collahu

  7. Slide 7: Markets

    Markets 2,500 500 2,000 400 LME Copper Price 0’s Metric Tons s Cents Per Poun C 1,500 300 1,000 200 000 nd 500 100 LME & COMEX Exchange Stocks* 0 0 Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- 99 99 00 00 01 01 02 02 03

  8. Slide 8: Copper Reserves & Mineralized Material

    Copper Reserves & Mineralized Material as of 12/31/10 billion lbs of copper 12/31/10 230 Mineralized Material (b) by Geographical Region Mineralized 110 Material (b) billion (contained copper) lbs North 120 at $2.20 Cu price America 54% South Indonesia America Reserves 17% 17% 12% at $2.00 Cu price

  9. Slide 9: Reserve Additions Post Merger

    Reserve Additions Post Merger g Since 12/31/06 +43 billion lbs Cu Cu* Candelaria/Ojos Bagdad Morenci Cerro Verde Sierrita Tenke Balance, net * Proven and probable reserves as of 12/31/10 totaled 120.5 bn lbs. and were based on a long-term average copper price of $2.00/lb. 9

  10. Slide 10: Exploration Targets

    Exploration Targets Click to inedit j Master Major Mineraltitle style y Districts Safford/Lone Star/Morenci District Cerro Verde North South Exploration America America in 2011e 32% 30% Tenke Fungurume/Africa $225 million 3% Africa 15% 20% Grasberg/Indonesia Indonesia Australasia & Other Areas Note:

  11. Slide 11: Value Creation Focus

    Value a ue Creation C ea o Focus ocus INVESTMENT CASH MINERAL RESERVE IN ATTRACTIVE PRODUCTION FLOWS/ RESOURCES ADDITIONS DEVELOPMENT GROWTH RETURNS PROJECTS 11

  12. Slide 12: Status of Announced Projects

    Status of Announced Projects Volumes Expansions (in mm lbs/year) Year Status Morenci Mill Restart & 125 2011 complete l t Mine Rate Increase Miami Mine Restart 100 2012 in progress 200 2012 Chino Mine & Mill Restart ( ) in progress (a) -2014 Subtotal 425 Tenke Mill & Mine Rate Increase 40 2011 compl

  13. Slide 13: Near-Term Copper Projects Under Evaluation

    Near-Term Copper Projects Under Evaluation Incremental Preliminary Copper Capital* Achieve Mill Expansions (mm lbs/year) ($ billions) Full Rates Cerro V C Verde d (360K) 600 $3.5 $3 5 2016 Morenci (115K) 150-200 0.9 2014 Tenke (14K) 150 08 0.8 2013 TOTAL 900-950 $5.2 ~1 billion lbs/year Incremental

  14. Slide 14: Potential Additional Projects

    Potential Additional Projects j North America South America • Sulfides/Mill Projects • El Abra Mill  Large Scale Morenci  Sierrita Af i Africa  Bagdad  Ajo • Future Expansion  Twin Buttes of Tenke Oxides • Safford/Lone Star • Tenke Sulfides 14

  15. Slide 15: 1Q11 Highlights

    1Q11 Q Highlights g g Sales Data 1Q11 1Q10 Copper Consolidated Volumes (mm lbs) 926 960 Average Realization (per lb) $4.31 $3.42 Site Production & Delivery Unit Costs (per lb) $1.61 $1.35 Unit Net Cash Costs (per lb) $0.79 $0.82 Gold Consolidated Volumes (000’s ozs) 480 478 Average Realization (per

  16. Slide 16: 2011 Outlook

    2011 0 Outlook Out oo  Sales Outlook: • Copper: 3.9 Billion lbs. • Gold: 1.6 Million ozs. • Molybdenum: 73 Million lbs.  Unit Net Cash Cost(1): • $1.04/lb  Operating Cash Flows(2): • ~$8.3 Billion (@$4.25 copper for remaining 9 months) • Each 10¢/lb Change in Copper = $250 MM in 2011  Capital Ex

  17. Slide 17: Near-Term Sales Profile

    Near-Term Near Term Sales Profile Excludes current projects under evaluation Gold Sales (million ozs) Copper Sales (billion lbs) 1.9 19 2 1.7 1.6 5 1.2 1 4.2 39 3.9 39 3.9 40 4.0 4 0 2010 2011e 2012e 2013e ____________________ 3 Note: Consolidated gold sales include approximately 184k ozs in 2010, 1

  18. Slide 18: 2011e Quarterly Payable Metal Sales

    2011e Q Quarterly y Payable y Metal Sales Gold Sales (thousand ozs) Copper Sales (million lbs) 800 1,250 600 480 445 1,045 400 365 275 1 000 1,000 965 965 926 200 0 1Q11 2Q11e 3Q11e 4Q11e 750 ____________________ Note: Consolidated gold sales include approximately 47k ozs in 1Q11, 38k ozs in 2Q11e,

  19. Slide 19: 2011 Operating Estimates

    2011 Operating p g Estimates 2011e Unit Production Costs North South (per pound of copper) America America Indonesia Africa Consolidated Cash Unit Costs (1) Site Production & Delivery (2) $1.82 $1.32 $2.00 $1.46 $1.67 By-product Credits (0.45) (0.31) (1.95) (0.62) (0.82) T Treatment t t Charges Ch 0

  20. Slide 20: EBITDA and Cash Flow at Various Copper Prices

    EBITDA and Cash Flow at Various Copper Prices Average EBITDA* ($1,200 Gold & $12 Molybdenum) $15 (US$ billions) $12 $9 $6 $3 $0 Cu $3.50/lb Cu $4.00/lb Cu $4.50/lb Average Operating Cash Flow (excluding Working Capital changes)* ($1,200 Gold & $12 Molybdenum) $10 (US$ billions) $8 $6 $4 $2 $0 Cu $3.

  21. Slide 21: Sensitivities

    Sensitivities Operating Ch Change EBITDA C h Fl Cash Flow (US$ millions) Copper: -/+ $0.10/lb $390 $270 Molybdenum: -/+ $1.00/lb $60 $50 Gold: -/+ $50/ounce $70 $40 Diesel(1): -/+ 10% $85 $55 Purchased Power(2): -/+ 10% $45 $25 Currencies(3): +/- 10% $130 $75 ____________________ (1) $3.35/gallon ba

  22. Slide 22: Capital Expenditures

    Capital Expenditures (1) Excludes current projects under evaluation (US$ billions) Major Projects All Other $3 0 $3.0 $2.5 $2.5 $2.1 $2.0 1.2 $1.4 $1.5 1.2 $1.0 0.7 (3) 1.3 (4) $0 5 $0.5 (2) (4) 0.9 0.7 $0.0 2010 2011e 2012e (1) Capital expenditure estimates will continue to be reviewed and revised

  23. Slide 23: Balance Sheet

    Balance Sheet  Repaid $3.7 bn in Debt Since (US$ billions) YE 2008 (50% Reduction) (2) $20 $17.6 (1)  $260 mm Interest I t t Annual A l Cost C t Savings $15  Investment Grade Rated by S&P,, Moody’s, y , Fitch Total Debt $10 $7.4 $5 $3.7 $0 At Time of PD Acquisition 12/31/08 Pro Forma in March 200

  24. Slide 24: Financial Policy

    Financial Policy o y  Maintain Strong Balance Sheet & Liquidity Position  Invest in Attractive Growth Projects  Opportunistic Debt Repayment  Current Common Stock Dividend Rate: $1.00/Share per Annum  Supplemental Dividend of $0.50/Share Paid June 1, 2011 • $0.50 (Post-split) Paid on December 3

  25. Slide 25: FCX Investment Summary

    FCX Investment Summary  World’s Premier Publicly Traded Copper Company  World World’s s Largest Molybdenum Producer & Significant Gold Producer  Long Long-lived lived Reserves, Geographically Diverse Operations  Flexible e b e Operating Ope at g Structure St uctu e Can Ca Respond espo d to Varyi

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