Freeport-mcmoran, Inc. · NYSE:FCX

Freeport-mcmoran — Freeport-McMoRan Copper & Gold — RBC Capital Markets Global Mining & Materials Conference 2009

26 slides from Freeport-mcmoran's conference presentation, Jun 10, 2009

  1. Slide 1: RBC Capital Global Mining & Materials Conference

    RBC Capital Global Mining & Materials Conference Toronto, Canada Richard C. Adkerson President & Chief Executive Officer June 10, 2009 www.fcx.com

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

    Cautionary Statement Regarding Forward-Looking Statements This presentation contains forward-looking statements in which we discuss factors we believe may affect our performance in the future. Forward-looking statements are all statements other than historical facts, such as statements regarding pro

  3. Slide 3: Core Assets

    Core Assets 2008 Annual Report Highlights  Long-Lived Reserves with Growth Potential  Geographically Diverse Operations  Flexible Operating Structure  Experienced Team  Focused Strategy 3

  4. Slide 4: Geographically Diverse

    Geographically Diverse Major Mine Operations & Development Projects All major assets majority-controlled and operated North North America America11 Copper Reserves Cu 28.3 billion lbs Copper/Gold/Silver Mo 2.1 billion lbs Molybdenum Sales Grasberg (90.64%) Cu 1.1 billion lbs Reserves Mo 50 million l

  5. Slide 5: First Quarter Highlights

    First Quarter Highlights  Strong Execution of Revised Operating Plan  Solid Performance at Grasberg  Achievement of Significant Cost Reductions  Advanced Construction at Tenke  Strengthened Liquidity Position Through Equity Offering  Improved Market Sentiment – Copper Top Performing Commodity

  6. Slide 6: Achieving Cost Reductions

    Achieving Cost Reductions Site Production & Delivery Costs - Consolidated Consolidated Site Production & Delivery $ per pound  Revised Operating 36% Plans Reduction $1.66  Grasberg Ore Grades $1.07  Aggressive Cost Management/Lower Input Costs 3Q08 1Q09 6

  7. Slide 7: Achieving Cost Reductions - North America

    Achieving Cost Reductions Site Production & Delivery Costs – North America North America Site Production & Delivery $ per pound  Aggressive Cost $2.07 Management 36% Reduction  Lower Input Costs $1.32  Diesel prices down 50%  Power prices down 35%  Significant decline in acid costs 3Q08 1Q09 7

  8. Slide 8: Copper Price & Inventories

    Copper Price & Inventories 2,000 400 1,750 350 1,500 300 1,250 250 000’s Metric Tons Cents Per Pound LME Copper Price 1,000 200 750 150 500 100 250 50 0 LME & COMEX Exchange Stocks* 0 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 As of June 5, 2009 * LME

  9. Slide 9: Copper Market Update

    Copper Market Update Change in Prices Demand Year-to-Date  China Has Been Primary Driver in 2009 70% 66% • Stimulus Plan is Focused on Infrastructure 63% Spending • Scarcity of Scrap has Resulted in Higher 60% Demand for Cathode • SRB Purchases 50%  Demand in the U.S., Europe and Japan Remains Wea

  10. Slide 10: Gold Market Update

    Gold Market Update London Gold Price ($/oz) $1,200 $1,000 $800 $600 $400 $200 $0 Jan-99 Jan-00 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 10

  11. Slide 11: Molybdenum Market Update

    Molybdenum Market Update Molybdenum Price* ($/lb)  2009 Range: $7.825 - $9.50/lb $40 $35 $30  Current Price: $10.15/lb $25 $20  Year Ago Price: $33.15/lb $15 $10  Destocking in Europe Has Been $5 Reduced Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- $0 02 02 03 03 04

  12. Slide 12: Operating Plan Overview

    Operating Plan Overview North & South America  Reduced rates at Morenci, Safford and Tyrone  Suspended operations at Chino; produce from leach pads  Reduced mining rates in Candelaria/Ojos district Molybdenum  Reduced further with an approximate 40% reduction to Henderson’s annual production, wh

  13. Slide 13: Sales Profile 2007 - 2010e

    Sales Profile 2007 - 2010e Gold Sales (million ozs) Copper Sales (billion lbs) 3 2.3 2.3 5 2.1 2 1.3 4.1 1 3.9 3.9 4 3.8 0 2007 2008 2009e 2010e Pro Forma* 3 ____________________ Note: Consolidated gold sales include approximately 228 k oz in 2007, 134 k oz in 2008, 230 k oz in 2009e, and 210 k oz i

  14. Slide 14: 2009e Quarterly Payable Metal Sales

    2009e Quarterly Payable Metal Sales Gold Sales (thousand ozs) Copper Sales (million lbs) 650 625 600 545 1,250 480 450 1,020 300 1,000 955 960 975 150 0 1Q09 2Q09e 3Q09e 4Q09e 750 ____________________ Note: Consolidated gold sales include approximately 53 k oz in 1Q09, 65 k oz in 2Q09e, 60 k oz in 3

  15. Slide 15: 2009e Sales and Unit Production Costs by Region

    2009e Sales and Unit Production Costs by Region 2009e Sales by Region (1) North America South America Indonesia 2.2 1,370 1,300 1,130 50 (2) 0.1 Cu Mo Cu Au Cu Au mm lbs mm lbs mm lbs mm ozs mm lbs mm ozs 2009e 2009e 2009e 2009e 2009e 2009e North South (per pound of copper) America America Indonesia

  16. Slide 16: Exploration

    Exploration 2008 2009e $248 million $75 million 22% 17% North America 7% 44% 34% South 20% America 4% 10% Indonesia Africa 13% 29% Activities focused on incorporating significant data Australasia obtained in 2008 into our & Other Areas future plans Note: FCX’s consolidated share; e = estimate. See C

  17. Slide 17: EBITDA and Cash Flow at Various Copper Prices

    EBITDA and Cash Flow at Various Copper Prices 2009e & 2010e Average Annual EBITDA ($900 Gold & $8 Molybdenum) $8 (US$ billions) $6 $4 $2 $0 Cu $1.50/lb Cu $2.00/lb Cu $2.50/lb 2009e & 2010e Average Annual Operating Cash Flow (excluding Working Capital)* ($900 Gold & $8 Molybdenum) $5 (US$ billions)

  18. Slide 18: Sensitivities (2009e & 2010e Avg.)

    Sensitivities (2009e & 2010e Avg.) Operating Change EBITDA Cash Flow (US$ millions) Copper: -/+ $0.10/lb $375 $260 Molybdenum: -/+ $1.00/lb $50 $45 Gold: -/+ $50/ounce $100 $60 Diesel (1): -/+ 10% $25 $15 Purchased Power (2): -/+ 10% $40 $25 Currencies (3): +/- 10% $110 $65 ____________________ (1)

  19. Slide 19: Capital Expenditures

    Capital Expenditures (1) Major Projects All Other (US$ billions) $3.0 $2.7 $2.5 1.1 $2.0 $1.5 $1.3 $1.0 $1.0 0.6 1.6 0.5 $0.5 (2) 0.7 0.5 (3) $0.0 2008 2009e 2010e (1) Capital expenditure estimates will continue to be reviewed and revised subject to market conditions (2) Includes Tenke development a

  20. Slide 20: Tenke Fungurume Development Project Update

    Tenke Fungurume Development Project Update  Construction and Commissioning Activities Advanced  Construction Activities Focused on Completing the Cobalt and Acid Plants  Ramp-up to Full Capacity in 2H09  $1.75 Billion in Aggregate Capital Costs • Reserves at 12/31/08: ̶ 5.9 Billion lbs Cu (2.6%)

  21. Slide 21: Tenke Fungurume Development Project Update

    Tenke Fungurume Development Project Update Cathodes Ready for Shipment Loaded Blanks Ready for Stripping SAG Mill Construction Site First Ore to Mill in March 1Q09 Stockpile Stockpile PLS PLS Leach SAG SAG Acid Leach Acid Ponds Ponds & & CCD CCD Plant Plant Cobalt Cobalt SX SX Plant Plant EW EW Sulp

  22. Slide 22: Tenke Fungurume

    Tenke Fungurume  Largest Investment in DRC  World-class Design & Construction  Significant Infrastructure Upgrades  Expanding Social & Community Programs Workers install a liner for the Tailings Storage Facility  Project Will Provide Important Benefits:  Employment  Local Services  Taxes  R

  23. Slide 23: Underground Mine Development in Indonesia

    Underground Mine Development in Indonesia Grasberg District Ore Bodies  Continuing underground development Grasberg  Big Gossan mine open pit  Grasberg Block Cave  Expansion of the DOZ mine to 80,000 t/d with completion by 2010  ~$160MM in aggregate capex Grasberg Block Cave for underground dev

  24. Slide 24: FCX Debt Maturities 3/31/09

    FCX Debt Maturities 3/31/09 $6,000 (US$ millions) Total Debt & Cash at 3/31/09 $5,000 (US$ billions) Public Debt $6.9 Other Debt 0.3 $4,002 $4,000 Total Debt $7.2 8.375% Senior Consolidated Cash $0.6 Notes and $3,000 PD $2,514 Senior Notes Floating Rate & $2,000 8.25% Senior Notes $1,000 $353 $83 $1

  25. Slide 25: Financial Policy

    Financial Policy  Maintain Strong Balance Sheet & Liquidity Position  Aggressive Cost Management  Capital Investments Will be Limited in Current Market Environment  Near-Term Focus Will be on Protecting Liquidity While Preserving Large Mineral Resources and Growth Options  Board to Review Finan

  26. Slide 26: FCX Investment Summary

    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  Significant Reserve Growth 26

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