Freeport-mcmoran, Inc. · NYSE:FCX
Freeport-mcmoran — Freeport-McMoRan Copper & Gold — Q2 2010 Earnings Presentation
37 slides from Freeport-mcmoran's earnings presentation, Jul 21, 2010
Slide 1: 2nd Quarter 2010 Earnings Conference Call
FREEPORT-McMoRAN Coprer & GoLp 2"¢ Quarter 2010 Earnings Conference Call PROVEN PERFORMANCE July 21, 2010 FCX LISTED www.fex.com NYSE.
Slide 2: Cautionary Statement Regarding Forward-Looking Statements
|FREEPORT-McMoRAN COPPER & GOLD Cautionary Statement Regarding Forward-Looking Statements This presentation contains forward-boking statements in which we discuss factors we believe may affect our performance in the future. Forward- looking statements are all statements other than statements of hist
Slide 3: 2Q10 Highlights
= FAEEPORT-MICMORAN COPPER & GOLD 2Q10 Highlights Sales Data 2Q. 1H2010 Consolidated Volumes (mm tbs) 914 1,874 Average Realization (per ib) $3.06 $3.13 Site Production & Delivery Unit Costs (per /b) $1.41 $1.38 Unit Net Cash Costs (per ib) $0.97 $0.89 Consolidated Volumes (0007's ozs) 298 776 Avera
Slide 4: Quarterly Operating Highlights
= FAEEPORT-MICMORAN COPPER & GOLD Quarterly Operating Highlights 2Q10 Unit Production Costs (per pound of copper) North South America America| Indonesia Africa Consolidated Cash Unit Costs Site Production & Delivery() $1.46 $1.22 $1.62 $1.27 $1.41 By-product Credits (0.38) (0.19) (1.41) (0.54) (0.61
Slide 5: LME & COMEX Exchange Stocks; Gold and Molybdenum Prices
FREEPORT-McMoRAN COPPER & GOLD ® 2 2 3 3 = GB = 5) é a “CN : 2 2 ro) 8 cnn a LME & COMEX Exchange Stocks* Jane Jule Jane ule an Jue Jan Jule Jane ae ne Jane Je Jame Je Jam Jule Jane ue an Jule Jan Jal | “LME and Comex, exciuaing Shanghai stocks, progucer, consumer and merchant stocks. London Gold Pr
Slide 6: North America: Morenci
FREEPORT-McMoRAN, DECC ERT EE ET DOREETS te COPPER & GOLD North America Morenci Mill Restart & Ramp-up illaveraged 28K t/d during second quarter & ramping up rates — 50K t/d by 2011 Increase Mine Rate e Ramping up from the current rate of ~450K to 635K t/d ¢ Additional stripping to expose additional
Slide 7: Development Project Update: North America
FREEPORT-McMoRAN, COPPER & GOLD Development Project Update North America Safford Sulphur Burner e Sulphur Burner at Safford ¢ ~$150MM project e Reduces external purchases of sulphuric acid, reduces transportation costs & provides more cost-effective source of acid ¢ Positive for long-term future of
Slide 8: Development Project Update: South America
|FREEPORT-McMoRAN Development Project Update ~ ~~~ COPPER & GOLD South America Cerro Verde Expansion ¢ Completing $50MM project to increase mill rate from 108K t/d to 120K t/d = 30MM lbs Cu per year of incremental metal at low cash cost e Evaluating large-scale concentrator expansion = Potential to
Slide 9: Long-Term Underground Mine Development in Indonesia
|FREEPORT-MIcMoRAN Long-Term Underground Mine SSs COPPER & GOLD Development in Indonesia ¢ Significant undeveloped underground reserves = Aggregate reserves of 41 billion Ibs Cu & 35 million ozs Au ¢ DOZ expanded to 80K t/d ¢ Big Gossan mine — full rates of 7K t/d by late 2012 ¢ Grasberg Block Cave
Slide 10: Tenke Fungurume
pan) REPORT Memoria. COPPER & GOLD Tenke Fungurume ° Sold 55MM Ibs Cu & 4MM lbs Co in 2Q10 ¢ At full rates (initial phase), aggregate annual metal of 250MM Ibs Cu & over 18MM Ibs Co = Addressing issues in SO, plant & Co circuit = Mill performing above 8K t/d design capacity = Increasing mining rate
Slide 11: Climax Restart
en |FREEPORT-McMoRAN COPPER & GOLD Climax Restart ¢ Assessing timing of start-up ¢ Advancing certain construction activities to provide flexibility ° One of the most attractive primary molybdenum development projects in the world — large-scale production capacity, attractive cash costs and future gr
Slide 12: Copper Reserves & Mineralized Material as of 12/31/09
= FAEEPORT-MICMORAN COPPER & Goo Copper Reserves & Mineralized Material as of 12/31/09 billion Ibs of copper 12/31/09 Copper Reserves P 226 by Geographical Region Mineralized 122 North Material) billion America > (contained copper) Ibs 257% 104 at $2.00 Cu price South “ A America Sidgyssts 33% Reser
Slide 13: Current Projects Under Evaluation
|FREEPORT-McMoRAN COPPER & GOLD Current Projects Under Evaluation North America Tenke Fungurume ¢ Chino Restart ¢ Debottlenecking e Further increases to Morenci ¢ Further oxide expansion mining rate ¢ Sulfide development ¢ Plans for Twin Buttes/ Sierrita district ° Climax ¢ Major mill projects for s
Slide 14: FCX Copper Projects
|FREEPORT-McMoRAN ‘vel COPPER & GOLD, FCX Copper Projects billion Ibs copperannually Replacement New Copper Projects Sources El Abra Sulfolix SA Potential Projects | 0.75 Tenke 0.25 Expansions \ 0.3 NA Potential NA Restarts Projects 1.4 billion Ibs Cu 1.8 billion Ibs Cu Other Opportunities ¢ Tenke S
Slide 15: Exploration Targets in Major Mineral Districts
[eanl REEMORT-MemonaN) : COPPER & GOLD SHiming Future Exploration Targets in Major Mineral Districts: South America Exploration pene 18% 3 merica in 2010e 35% $120 million 22%. Indonesia Australasia & Other Areas Note: FOX's consolidsted share; & = estimate, See Cautionary Statement, 15
Slide 16: 2010 Outlook
|FREEPORT-McMoRAN COPPER & GOLD 2010 Outlook » Sales Outlook: ¢ Copper: 3.8 Billion Ibs. ¢ Gold: 1.8 Million ozs. ¢ Molybdenum: 63 Million Ibs. » Unit Net Cash Cost //; 86¢/Ib Exceed $5 Billion « Assumes $3.00/lb Copper for remaining 6 months « Each 10¢/lb Change in Copper = $150 Million in 2010 > O
Slide 17: Grasberg Pit Mine Plan
Fenn) BEFORE Memon COPPER & GOLD Grasberg Pit Mine Plan Changes to Pushback 8E Revised mine plans incorporate precautionary remedial activities & geotechnical considerations affecting a relatively high-grade section of the Grasberg open pit previously scheduled to be mined in 2010/2011 + Highwall ab
Slide 18: Near-Term Sales Profile
FREEPORT MICMORAN COPPER & GOLD Near-Term Sales Profile Excludes current projects under evaluation Copper Sales (billion Ibs) 2010e 2011e 2012e ‘Fate: Ginsoed copper sles include sprotimately 741 mm lin 20100, 795 mm lbs in 20418, 200740 ms 20422 for nonconreling interest; excludes purhased copper,
Slide 19: Quarterly Copper, Gold and Molybdenum Sales
FREEPORT MICMORAN COPPER & GOLD Copper Sales (million lbs) 1,250, 1,000 750 500 250 1910 2910 3Q10e 4gioe ‘Foier Ciasoitaed copper sles inclade spproximatly 181 mo lisp 1010, 173 nm ibe 2010, 497 mm ibs in 3068 and 180 mks in 9168 Fer noocontliyg ‘ntact: excludes urchaced copper 800 655 800: 478 410
Slide 20: 2010e Sales and Unit Production Costs by Region
=o 2010e Sales and Unit Production COPPER & GOLD Costs by Region 2010e Sales by Region North America South America Indonesia Africa 1,305 4,175 a7 250 20 O41 Cu - m | & & (per pound of copper} North South America America Indonesia Africa Consolidated Cash Unit Costs‘) Site Production & Delivery $1.4
Slide 21: EBITDA and Cash Flow at Various Copper Prices
Fran) SEERORT MOM oF : : 7 COPPER & GOLD EBITDA and Gash Fi 1OW at Various Gopper- Prices Average EBITDA* ($1,000 Gold & $10 Molybdenum) $10 (USsbillions) $8 $6 $4 $2 $0 : Cu $2.50/Ib Cu $3.00/Ib Cu $3.50/Ib Average Operating Cash Flow (excluding Working Capital changes)* ($1,000 Gold & $10 Molybden
Slide 22: Sensitivities
= FAEEPORT-MICMORAN COPPER & GOLD Sensitivities Operating Change EBITDA Cash Flow (058 millions} Copper: -/+ $0.10/Ib $375 $260 Molybdenum: -/+ $1.00/Ib $55 $45 Gold: -/+ $50/ounce $70 $40 Diesel: -/+ 10% $45 $30 Purchased Power™: -/+ 10% $40 $25 Currencies™: +/- 10% $120 $70 (i ¥#2-2Afgalion base c
Slide 23: Capital Expenditures
Capital Expenditures (US$ billions) $3.0 mMajorProjects mAllOther $2.5 $2.0 $1.55 $1.0 $0.5 $0.0 2008 2009 2010e 2011e (2) Capitalexpenditae estimates willcontinue to be reviewed andrevined subject to market conditions. (2) Includes $1.1 bilon for Tenke develooment. (3) Includes Tenke development, G
Slide 24: Balance Sheet
Fenn) BEFORE Memon . COPPER & GOLD Balance Sheet (US$ billions) Significant Liquidity $20 $17.6” Strong Credit Metrics $15 No Near-term Maturities Ral & % $10 2 $5 $0 - At Time of PD Acquisition 12/31/08 6/30/10 in March 2007 (1) Pro Forma yearend 2006 otal debt of $1.6 bition plus $16 ikon acquisti
Slide 25: Financial Policy
|FREEPORT-McMoRAN COPPER & GOLD Financial Policy = Maintain Strong Balance Sheet & Liquidity Position = Aggressive Cost Management = Invest in Attractive Growth Projects as Economic Conditions Warrant = Opportunistic Debt Repayment = Common Stock Dividend: $1.20/share per annum = Board to Review Fin
Slide 26: FCX Investment Summary
|FREEPORT-McMoRAN COPPER & GOLD FCX Investment Summary = World’s Premier Publicly Traded Copper Company World’s Largest Molybdenum Producer & Significant Gold Producer Long-lived Reserves, Geographically Diverse Operations Flexible Operating Structure Can Respond to Varying Market Conditions Signifi
Slide 27: Slides
Slides
Slide 28: Grasberg Open Pit
Grasberg Open Pit
Slide 29: PT-FI Mine Plan
|FREEPORT-McMoRAN COPPER & GOLD PT-FI Mine Plan P1-Fil's Share of Metal Sales, 2010e-2014e 2010¢ — 2014e PT-FI Share Zz Copper, billion Ibs Total: 5.6 billion Ibs copper Annual Average: 1.12 billion Ibs 4 _ Gold, million ozs 20100 — 2014e PT-FI Share Total: 7.7 million ozs gold Annual Average: 1.54
Slide 30: Mining Sequence in 2010
— —————— EEPORT-MICMORAN ore! Mining Sequence in 2010 Copper Equivalent Cross Section SE is the Primary Ore Pushback in 2010
Slide 31: Mining Sequence in 2010
— —————— EEPORT-MICMORAN ore! Mining Sequence in 2010 Copper Equivalent Cross Section SE is the Primary Ore Pushback in 2010
Slide 32: Mining Sequence in 2010
—_— —————— EEPORT-MICMORAN ore! Mining Sequence in 2010 Copper Equivalent Cross Section SE is the Primary Ore Pushback in 2010 1s
Slide 33: Mining Sequence in 2010
—_— —————— EEPORT-MICMORAN ore! Mining Sequence in 2010 Copper Equivalent Cross Section SE is the Primary Ore Pushback in 2010 1s
Slide 34: Mining Sequence in 2011
— ————— EEPORT-MICMORAN COPPER & GOLD Mining Sequence in 2011 Copper Equivalent Cross Section 8E and 9N are the Primary Ore Pushbacks in 2011 Ed
Slide 35: Mining Sequence in 2012
————— mie waining Sequence in 2012 Copper Equivalent Cross Section COPPER & GOLD
Slide 36: Mining Sequence in 2013
————— ae Mining Sequence in 2013 Copper Equivalent Cross Section COPPER & GOLD
Slide 37: Mining Sequence in 2014
————— TT Mining Sequence in 2014 Copper Equivalent Cross Section COPPER & GOLD
Freeport-McMoRan Copper & Gold — Q2 2010 Earnings Presentation on 6ix