Freeport-mcmoran, Inc. · NYSE:FCX
Freeport-mcmoran — Barclays CEO Energy-Power Conference 2014
30 slides from Freeport-mcmoran's conference presentation, Sep 3, 2014
Slide 1: CEO Energy-Power Conference
CEO Energy-Power Conference September 2014 www.fcx.com
Slide 2: Cautionary Statement
Cautionary Statement This presentation contains forward-looking statements in which Freeport-McMoRan Oil & Gas (FM O&G) discusses its potential future performance. Forward-looking statements are all statements other than statements of historical facts, such as projections or expectations relating to
Slide 3: Key Strengths & Highlights
Freeport-McMoRan Oil & Gas Key Strengths & Highlights High-Quality U.S. Based Oil & Gas Assets Strong Margins & Cash Flows - Over 90% of Revenues From Oil & Liquids Growing Production Profile Through Expansion Using Strategic Deepwater Infrastructure to Enhance Returns Experienced Technical
Slide 4: Oil & Gas Operating Portfolio
Oil & Gas Operating Portfolio Madden California San Joaquin Valley Haynesville Arroyo Grande Santa Maria Basin Los Angeles Basin Gulf of Mexico California Haynesville/Madden Gulf of Mexico • 2,000+ future locations • 11,000+ future locations • 175+ future locations • Brent based pricing • NYMEX pric
Slide 5: Reserves & Resource Potential
Reserves & Resource Potential Year-end 2013 Proved Reserves & Net Unrisked Resource Potential 4.3 3.3 18.1 5.1 0.4 0.2 0.2 N/A 0.3 N/A Reserves Resource Reserves Resource Reserves Resource Reserves Resource Reserves Resource California Deepwater GOM Inboard Lower Tertiary Haynesville/Other Internati
Slide 6: Strong Execution – Trailing 12-month Results
Strong Execution – Trailing 12-month Results Strong Operating/Financial Performance in Brent and HLS Pricing per Bbl 12-month Period Ended June 30, 2014 $150 TTM EBITDA of $3.6 bn $125 $100 Benefitting from Strong Brent & HLS Crude $75 Oil Pricing $50 − FM O&G Oil Realization: $100/bbl $25 − 9
Slide 7: Portfolio Optimization
Portfolio Optimization 2Q 2014 Transactions Resource Potential Comparison (MMBOE) Sold Eagle Ford Shale Interests to Encana for $3.1 bn Acquired $0.9 bn Deepwater GOM 650 Interests, Including: - Lucius Oil Development (5.1% WI) - Heidelberg Oil Development (12.5% WI) - Acquisitions to Replace Ea
Slide 8: Production Profile
Production Profile (MBOE/D) 350 300 DW GOM Heidelberg Exploration 250 Lucius 200 Horn Mountain Deepwater Holstein 150 GOM Marlin 100 California 50 Haynesville Gas Assets Madden Inboard Lower Tertiary 0 2014 2015 2016 2017 2018 2019 2020 2021 2022 NOTE: Operating resources are unrisked and consist of
Slide 9: Strategic Position in Deepwater Gulf of Mexico
Strategic Position in Deepwater Gulf of Mexico Major Exploration/ Operating/ Development Exploitation Producing Assets Projects Opportunities Significant Current Oil Financially Attractive Strategic Acreage Near Production with Strong Development Activities Existing Facilities with Cash Margin
Slide 10: Deepwater GOM Infrastructure with Excess Capacity
Deepwater GOM Infrastructure with Excess Capacity 1H 2014 Production of 61 MBOE/d from DW GOM Holstein Marlin Horn Mountain Capacity ~12% Utilization Capacity ~40% Utilization Capacity ~12% Utilization • 113,500 BOPD • 60,000 BOPD • 75,000 BOPD • 142,300 MCFD • 235,000 MCFD • 72,000 MCFD Truss SPAR
Slide 11: Deepwater Gulf of Mexico Focus Areas
Deepwater Gulf of Mexico Focus Areas Louisiana Texas Marlin Dorado Viosca Knoll Horn Mountain Mississippi Canyon Area Green Canyon Area Holstein East Breaks Garden Banks Holstein Deep Holstein Atwater Valley Diana Heidelberg Copper Hoover Alaminos Canyon Walker Ridge Facilities Lucius Development Ke
Slide 12: Deepwater Gulf of Mexico Green Canyon Asset Area
Deepwater Gulf of Mexico Green Canyon Asset Area Texas GreenLouisiana Canyon Current Activities Asset Area Green Canyon Marlin 1st Holstein ST Well Commenced Production June 2014 at ~3,600 MBOE/d Dorado Viosca Knoll Holstein Deep Holstein 2nd Holstein ST Well Successful, Completion Underway Horn
Slide 13: Holstein Development: 2014-16 Sidetrack Drilling Plan
Holstein Development 2014-16 Sidetrack Drilling Plan (7 Wells) A1ST4 K2 - Completing A10ST J1/H1 A11ST K2 Ramp A3ST A16ST1 K1 – Completed A5ST Producing J2/J3 Crestal Holstein 3,600 BOE/D Spar Proposed A7ST K2 Trough Injector J2 South Producing Well Proposed Well 13
Slide 14: Holstein Deep Development
Holstein Deep Development Miocene Type Log FM O&G Operated with GC 643 100% WI OCS-G 16772 #1 & 1ST2 2 Successful Wells Drilled on Structure in 2006/2009 Reacquired Acreage in 2013 Lease Sale Delineation Drilling Currently in Progress Net Resource Potential of 142 MMBOE Currently Drilling
Slide 15: Copper Exploration Subsea Tieback Example
Copper Exploration Subsea Tieback Example FM O&G Operated with 100% WI Drilling of Initial Exploration Well in Holstein Field Progress; Follow-up Well to Spud in 4Q 2014 Net Resource Potential: 70 MMBOE Pliocene/Miocene Amplitude Play - Currently Syncline Separated from Holstein Drilling Pay
Slide 16: Heidelberg – Deepwater GOM Development Project
Heidelberg – Deepwater GOM Development Project First Production Expected in 2016 6-Well Initial Development Program 200-400 MMBOE Gross Resource Potential Heidelberg Spar Processing Capacity: 80,000 BOPD FM O&G 12.5% WI Water Depth: 5,300’ Located 200 Miles South of New Orleans Heidelb
Slide 17: Deepwater Gulf of Mexico Mississippi Canyon Asset Area
Deepwater Gulf of Mexico Mississippi Canyon Asset Area Texas Marlin Louisiana Planned Activities Marlin Dorado Marlin Viosca Knoll King Dorado Dorado Development Drilling to Commence in Late Viosca Knoll Mississippi Horn Mountain 2014/early 2015 Canyon Horn Mississippi Canyon Mountain Asset Area M
Slide 18: Dorado Development
Dorado Development Marlin FM O&G Operated with Facility 100% WI Cumulative Dorado Production – 34 MMBOE Net Resource Potential of 15 MMBOE from Planned Three Well Infill Program *1 SS7 SS4 Infill Program Will Target Undrained Fault Blocks and Attic Potential *2 SS5 SS3 SS6 SS8 The Field is
Slide 19: King M66/63 Development
King M66/63 Development King Field Composite Type Log FM O&G Operated with 100% WI M66/63 Net Resource Potential of 142 MMBOE for Updip Attic, Infill and Deeper M66 ST Pool Test Locations M63 2 Based on 4D Seismic High Quality Miocene M66 Infill Sands That are Part of M63 1 a Regionally Extens
Slide 20: Kilo/Oscar/Quebec/Victory (KOQV) Development
Kilo/Oscar/Quebec/Victory(KOQV) Development FM O&G Operated with 100% WI Cumulative Field Production – 120 MMBOE Net Resource Potential of 22 MMBOE from Planned Lion Infill Program Sable Kilo/Oscar Infill Program Will Target Undrained Compartments and Attic Potential Victory/Quebec Eland/Zeb
Slide 21: Deepwater Gulf of Mexico Keathley Canyon Asset Area
Deepwater Gulf of Mexico Keathley Canyon Asset Area Current Activities at Lucius Louisiana Texas Keathley Canyon Asset Area Marlin Dorado All Major Construction and Installation Projects have been Completed Viosca Knoll Lucius Horn Keathley Canyon Mississippi Canyon Mountain 80,000-BOPD Spar Exp
Slide 22: Lucius – Deepwater GOM Development Project
Lucius – Deepwater GOM Development Project First Production Expected in 4Q 2014 300+ MMBOE Gross Resource Potential Processing Capacity – 80,000 BOPD Lucius – 450,000 MCFD FM O&G 25.1% WI Water Depth: 7,200’ Located 300 Miles Southwest of New Orleans Pliocene Subsalt Reservoirs 22
Slide 23: Lucius Development
Lucius Development Thick Pliocene oil column Lucius 1 Lucius 6 Lucius 3 Lucius 2 Lucius 4 Lucius 5 23
Slide 24: Inboard Lower Tertiary/Cretaceous & Other Natural Gas Assets
Inboard Lower Tertiary/Cretaceous & Other Natural Gas Assets Industry Leader in Emerging New ILT Trend Cretaceous Near-term Natural Gas Project Inventory Tuscaloosa Trend Cumulative Production 3.1 TCF, 121 mmbc Tuscaloosa Trend LOUISIANA Farthest Gate West Lineham Creek Highlander Project Unrisked R
Slide 25: Highlander Discovery Onshore South LA – Cretaceous Tuscaloosa
Highlander Discovery Onshore South LA – Cretaceous Tuscaloosa Favorable Reservoir Characteristics Highlander Judge Digby Field Discovery Type Log Tusc 1 Tusc 2 Proposed Location 4Q 2014 Spud Tusc 3 Cretaceous Tuscaloosa Trend Cumulative Production 3.1 TCF, 121 mmbc Tuscaloosa Trend Highlander Discov
Slide 26: International Exploration - Morocco
International Exploration - Morocco Miocene and Cretaceous Play Net Resource Potential of 3.3 Billion BOE Chevron Chariot FM O&G Morocco Mazagan Permit Area Kosmos, BP Kosmos, BP Agadir Chevron Kosmos, BP Genel Cairn Cairn, Genel Genel Algeria GALP Africa 26
Slide 27: Focus on Value Creation
Freeport-McMoRan Oil & Gas Focus on Value Creation High Value Production + High Impact Development Projects Directed Around Producing Assets + Emerging Exploration From Inboard Lower Tertiary/Cretaceous, International and Deepwater Gulf of Mexico = Value Creation 27
Slide 28: Addendum
FREEPORT-MCMORAN STRENGTH IN RESOURCES Addendum
Slide 29: Reconciliation of Cash Margin (Non-GAAP) to Gross Profit (GAAP)
Reconciliation of Cash Margin (Non-GAAP) to Gross Profit (GAAP) The following table reconciles cash margin, a non-GAAP measure, to gross profit (GAAP) for the trailing twelve months ended June 30, 2014. Management believes this presentation may be useful to investors. FM O&G management uses this inf
Slide 30: Reconciliation of Cash Margin (Non-GAAP) to Gross Profit (GAAP)
Reconciliation of Cash Margin (Non-GAAP) to Gross Profit (GAAP) The following table reconciles cash margin, a non-GAAP measure, to gross profit (GAAP) for the six months ended June 30, 2014. Management believes this presentation may be useful to investors. FM O&G management uses this information for
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