Slide 1: 2nd Quarter 2015 Earnings Conference Call
HE Freepont-McMoRan 2nd Quarter 2015 Earnings Conference Call July 23, 2015 VALUE AT OUR CORE FCX [LISTED] NYSE fex.com
Slide 2: Cautionary Statement Regarding Forward-Looking Statements
[| FREEPoRT-McMoRan Cautionary Statement Regarding Forward-Looking Statements VALUE AT OUR CORE 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, suc
Slide 3: Strong Operating & Cost Performance in Mining and O&G
Strong Operating & Cost Performance in Mining and O&G Mining | = Morenci Project at Full Rates = Cerro Verde More Than 87% Complete = Improving Operating Trends at Grasberg * Positioned for Near-term Growth in Production & Declining Costs/Capital Expenditures * Lucius Production Reached Full Capacit
Slide 4: Sales Data
Sales Data Copper Consolidated Volumes (mm Ibs) Average Realized Prices (per Ib) $2.71 $2.70 Site Production & Delivery Costs (per Ib) $1.85 $1.89 Unit Net Cash Costs (per Ib) $1.50 $1.57 Gold Consolidated Volumes (000's ozs) 352 615 Average Realized Prices (per oz) $1,174 $1,183 it Consolidated Vol
Slide 5: Copper Market Commentary
= FREEPORT-McMoRan Copper Market Commentary VALUE AT OUR CORE = Global Economic Uncertainty and Stronger U.S. Dollar = China Economy Slowing - Requirements for Copper Growing in Absolute Terms = U.S. Recovery Continues At Moderate Rate = Gradual Recovery in Europe = Near-term Price Uncertainty with
Slide 6: World Class Copper
FREEPORT-McMoRan World Class Copper VALUE AT OUR CORE Discoveries Are Extremely Rare Recoverable Copper Reserves 2014e Copper Production ition metrictons Thousand metrctons 0 Ss 10 15 2 2 30 35 © 200 400 600 800 1000 1200 1400 Escondida - 1981 Escondida - 1981 Collabuast - 188 Chuquicamata - 1916 Gr
Slide 7: Copper Markets - Long-term Fundamentals Support Positive Outlook
|[E=0] FREEPonT-McMoRan Copper Markets —Long-term Fundamentals Support Positive Outlook, Total Copper Consumption = Assuming 2.4% Annual Global Growth* Over Next 10 Years, Copper Market Expected to Grow by +7.6 mm Tonnes (27%) +7.6 mm 7 = Quin mm tonnes 8 = Over Same Period, Production from Existing
Slide 8: Cash Unit Costs
Cash Unit Costs North (per pound of copper) South America America Indonesia Africa Ce Site Production & Delivery $1.78 $1.77 $2.26 $1.54 $1.85 By-Product Credits (0.16) (0.04) (2.13) (0.53) (0.59) Treatment Charges 0.12 0.17 0.32 - 0. Royalties & Export Duties - - 0.36 0.06 0.08 Unit Net Cash Costs
Slide 9: Strong Project Execution
[==] FREEPORT-McMoRan Strong Project Execution, Capital Incremental First Copper/ Construction Costs opper Achieve Full Commenced — ($bin) (mm Ibs/yr) Rates Tenke Fungurume 2Q11 $0.9 150 1Q13/1Q13 Phase II Expansion Morenci 1Q12 $1.6 225 2Q14/2Q15 Mill Expansion Cerro Verde 1Q13 $4.6* 600 4Q15e/3Q16
Slide 10: Cerro Verde Mill Expansion
Cerro Verde Mill Expansion [=] FREEPoRT-McMoRal b= : ns Detailed engineering & major P P = To become world’s largest concentrating facility Construction advancing on schedule & more than 87% complete Completion expected in late 2015 Expected to add 600 mm lbs of Cu per annum $4.6 billion project; $3
Slide 11: Declining Unit Net Cash Cost Profile
(millions of Ibs) 750 > i 500 250 5 o 1Q15 2Q15 3Q15e 4Q15e 2016e . ‘0/0e gold, $1.57/b. and $1.42/b., respectvely. e = estimate. See Cautionary Statement. Avg. & L Declining Unit Net Cash Cost Profile $2.00 (Sper Ib) $1.50 $1.00 $0.50 $0.00 1Q15 2Q15 2H15e* —-2016e* (Sin bns) = $3.5 4 pan $2 $1 $0
Slide 12: Discussions with Government on Long-Term Operating Rights
" Propteeena Discussions with Government on Long-Term Operating Rights — PT-FI Requirement for Assurance of Legal and Fiscal Terms to Support Major Investments + GOI & PT-FI Focused on Developing a Mutually Satisfactory Solution — All Rights Under COW to Continue Until Agreed Amendment — Advancing P
Slide 13: Grasberg BC & DMLZ Underground Mine Development
[esl FREEPORT: McMoRe ded 5 Grasberg BC & DMLZ Underground Mine Development ¢ Completed development of access to DMLZ Crusher underground ore bodies ¢ Expect DMLZ start-up in late 2015 & Grasberg BC in 2018 e Key development activities include work on ore flow systems & Grasberg BC shaft ¢ Developme
Slide 14: Significant Copper Resources & Potential
ns ee Sig ignificant Copper esources & Potential billion Ibs of copper : ‘uture Resource Reserves* H 1 0 4. Development Opportunities 2 + El Abra Mineralized = North America Sulfides Material**, = Tenke (contained Cu) Reserves & Mineralized Reserves 207 Material Potential*** bk (contained Cu) —/ Res
Slide 15: O&G Highlights: Growth in Deepwater GOM
Gas HIGhNgnts: Growth in Deepwater GOM = Principally Focused on Lower Risk Drilling and Tieback Opportunities * Drilling Success Since 201: 0 for 10 on 100%-owned Wells in Producing Fields — 3 Placed on Production in 2014/1H 2015 — 4High Impact Tieback Wells to Come On-line Over Next 12 Months ional
Slide 16: Deepwater GOM Drilling Results
FREEPORT-McMoRa! eae id Deepwater GOM ok De 55 Drilled 10 Successful Wells Since 2014 3 Placed on Production; Others to Support Near-term Growth Holstein — 100% Marlin — 100% Horn Mtn. — 100% Logged 3" Successful Subsalt Miocene in July 2015 Established Sand Continuity Across Primary Reservoir Produ
Slide 17: Lower Risk Drilling Near Existing Production Facilities
= Lower Risk Drilling Near Existing Production Facilities Subsea Tiebacks Enhance Cycle Time * Existing Infrastructure Provides Competitive Advantage Dorado ~3 Months — Allows for Accelerated Development Holstein Deep ~12-18 Months and Production (i.e. Reduced Cycle King «9-12 Months Time) — Relativ
Slide 18: Lucius & Heidelberg
Lucius & Heidelberg — Ww -GOM Development Projects: Lucius = Achieved First Oil in January 2015 = Reached Capacity of 80 MBbI/d in 2Q 2015 — FM O&G Share of 2Q Sales: 19 MBOE/d = 6 Subsea Wells Tied Back to Truss Spar = FM O&G 25.1% WI = Water Depth: 7,200’ Heidelberg = Designed as Lucius Look-alike
Slide 19: Near-term Growth in Oil & Gas Production
Near-term Growth i an (MBOE/d) 143 2015e 2016e 2017e 2016e/2017e Projected to Benefit from New Production: *Holstein Deep * Horn Mtn. (KO/QV) _* Heidelberg . See Cautions
Slide 20: Production Rate and EBITDA Sensitivity
Production Rate 150_175 200 225 150 175 200 225 (MBOE/d) a eATEEI Bean 150 175 200 225 $60/bbI Brent $70/bbI Brent $80/bbI Brent “EBITDA equa’ operating income plus deprecation, depleton and amortzation. Amounts are estimates for lustrative purposes based on modelresults. 150 Mb day modelrafects N O
Slide 21: Vito Discovery and Power Nap
Vito Discovery Large, Deep Subsalt Miocene Discovery Made in 2009 FM O&G Acquired Rights in 2014 Development Options are Under Evaluation = Operator Expected to Propose Sanctioning in 2016 = FM O&G 18.67% WI Deep Sleep Drillship Power Nap Discovery Deep Sleep Exploration Well . and Appraisal Sid k =
Slide 22: Attractive Deepwater GoM Inventory
[sa] Faeeponr-McMoRaw ile Pie esi LF Attractive Deepwater GoM / — Z Inventory in Strategic Foc Ge womens 16 Prospects Identified by Seismic Imaging; ; Includes 154 Undeveloped Well Locations | Projected Spud Year t 2015 ( 2016 2017 2018+ bad Horn Mtn. (MCArea) Horn Mtn. (MCArea) Horn Mtn. (MCArea) H
Slide 23: Sales Outlook and Unit Cost
Sales Outlook Unit Cost = Copper: 4.2 Billion Ibs. = $1.53/Ib@ of Copper = Gold: 1.3 Million ozs. = $19/BOE = Molybdenum: 93 Million Ibs. * Oil Equivalents”: 52.3 MMBOE (~67% Oil) Operating Cash Flows Capital Expenditures = ~$3.6 Billion (@$2.50/Ib Copper for = $6.3 Billion Remainder of 2015) - $3.5
Slide 24: Annual Sales Volumes 2014-2017e
2014 2015e 2016e 2017e ‘Note: Congoldated copper sales nclide 715mm Bs h 2014, 710mm bs h 20158 1,080 mmibs in 2016e, and 1, ‘exchides purchased copper. ud hchded asm bs of cope ses fom Candetsra/Qjos, which was sold in November. e = estimate. See Cautionary Statement. ‘mmibs in 2017e for noncontokn
Slide 25: Quarterly Sales Volumes
Copper Sales (mittion tbs) 1,250 1,000 750 500 — 250 iets 2Q15 3Q15e 4Q15e Note: Consol ci apronnately 168 mm Beh 101% 149mm be h Seiten ee, Rieeeiisnn ‘Bs in 4Q15e fornoncont ekcudes purchased copper. e = estimate. See Cautionary Statement. ‘roncontroling int 15 ee BOIS Sdise AQISe approximately 2%
Slide 26: 2015e Unit Costs and Sales by Region
ind of copper) uth ae ‘ America America _ Indonesia Africa Consolidated Cash Unit Costs Site Production & Delivery 2 $1.74 $1.61 $2.29 $1.58 $1.81 By-product Credits (0.14) (0.06) (1.79) (0.52) (0.50) Treatment Charges 0.12 0.19 0.30 = 0.16 Royalties & Export Duties : 0.01 0.28 0.06 0.06 Unit Net Ca
Slide 27: EBITDA and Cash Flow Sensitivities
$10 $5 2016e/2017e $0 ses —_ cu $2.50/lb Cu $3.00/Ib Cu $3.50/Ib A Cash Flow luding Working Capital changes) ($1,200 Gold, $8 peoWindentes & $70 Oil) $12 (USS billions) $8 2016e/2017e Average $0 Cu $2.50/Ib Cu $3.00/Ib Cu $3.50/Ib ‘Not 2016¢/20 17e average, each $50/oz change in gold approximates $1
Slide 28: Price Sensitivities
Change Copper: +/- $0.10/Ib Molybdenum: +/- $1.00/Ib Gold: +/- $50/ounce Oil Sales: +/- $5/bbI” Oil Sales Net ve Diesel Costs:@7 +/- $5/bbI Natural Gas: +/- $0.50/Mcf Currencies: +/- 10% $135 (2)Amounts are net of mnng cost mpacts of a $5/bbI change in ol prices. (@) U.S. Dolar Exchange Rates: 625 C
Slide 29: Capital Expenditures
nditures! $6.3 $0 @) (2) Primarily includes Cerro Note: Inclides capitalzed interest. e= estimate. See Cautionary Statement.
Slide 30: Strong Track Record
Strong Track Record = Large Resource Base with Strong Cash Flows and Capital Discipline = Have Taken Steps to Reduce Cost & CAPEX, Complete Asset Sales and Reduce Common Stock Dividend . ing Volumes & jing CAPEX Profile Will Enhance Credit Metrics = Advancing Plans for External Funding, Including Co
Slide 31: Key Priorities
= FREEPORT-McMoRan Key Priorities VALUE AT OUR CORE = Strong Balance Sheet = Manage Operations and CAPEX to Maximize Cash Flow in Weak Market Environment = Obtain O&G Funding to Accelerate Growth = Complete Near-term Mining Projects = Generate Values from Large Resource Base Strong Track Record for
Slide 32: Reference Slides
{-:0 FREEPORT-McMoRan Reference Slides
Slide 33: PT-FI Copper and Gold Sales Profile
a FREePort-McMoRan VALUE AT OUR CORE 2015¢ — 2019e PT-FI Share Total: 5.6 billion Ibs copper copper, billion Ibs Annual Average: 1.12 billion lbs — |. Gold, million ozs 2015e — 2019e PT-FI Share Total: 7.6 million ozs gold Annual Average: 1.52 million ozs 2A 1.9 1.5 15 a | — 11 1a ; j | ti I | jj 0.
Slide 34: Life-of-Mine Production Sequence
Life-of-Mine Production Sequens 1 £790 mt 039696 bur & 4.06 a) Grasberg: ‘open pit 4.0120 mt 1.00% Cu &0.77 g/t A DDO DE i a Grasberg RUCIIGTITS 7 2585 E1070) AU, i Hut Block Cave COW Term, including extensions 2015 2017 2019 2021 202 22 227 2029 2031 203 203 2037 2039 2041 Big Gossan Spur 4 N Porta
Slide 35: 2Q 2015 Oil & Gas Margins by Region
2Q 2015 Oil & Gas Margins by Region Haynesville/ Oo ting Margit Madden/ petarng ste California Oth GOM Cc if Realized Revenue per BOE $48.30 $16.15 $47.82 $50.04 Cash Production Costs per BOE 27.13 13.55 16.98 19.04 Cash Operating Margin per BOE $21.17 $2.60 $30.84 $31.00 2Q 2015 Oil & Gas Sales by
Slide 36: Deepwater Gulf of Mexico Focus Areas
{-- FREePorT-McMoRan ‘ : ey; Y ea SS ig ZF Deepwater Gulf of Mexico Focus Areas. — pee ON florn Mississippi” Ma Cany Facilities > Development * Exploration Discover |} FM O&G Leases —
Slide 37: FM O&G Operated With 100% WI
FM O&G Operated With 100% WI = Logged 34 Successful Subsalt Miocene Well in July 2015 = Results from 3-Well Program Established Sand Continuity Across Primary Reservoir = Phase #1 Production Expected in 2016 « Drilling Results To Date Support Potential for Expanded Drilling Program = When Fully Deve
Slide 38: Horn Mountain Field Infill Development Program
[E=]| FREEPonT-McMoRa Horn Mountain Field. Infill Development Program M2 Sand Structure aR WOUNT AIA = Cumulative Field Mississippi Canyon 127 Production 120 MMBOE «= Infill Program Will Target Undrained Compartments and Attic Potential = Miocene J and M Sand Reservoirs are Part of a Regionally Exte
Slide 39: International Exploration - Morocco
[Fo FR REEPC oRT-Mi cMoR: \N 1ternational Exploration - h CCC SE ett Morocco oun con Spud MZ-1 Exploration Well in May 2015; Drilling in Progress Morocco Exploration Area Covers 2.2 Million Gross Acres in Water Depths of 4,500’ — 9,900’
Slide 40: Oil & Gas Operating Costs and Pricing
‘Operating Cost: $2.10/Mcfe California Pricing: NYMEX Operating Cost: $31/bbI Gulf of Mexico Operating Cost: $15/bbl Pricing: HLS/NYMEX Oil MBOE/D Inctides ~5 MBbI/d oF NGLs and GOM Shel/T production NOTE: Operating costs exclude DDS and Gi. DOA (including eccreton)s expected to approxmate $30/80E h
Slide 41: Oil & Gas Capital Expenditures
‘=ve| FREEPORT-McMoRan Oil & Gas Capital Expenditures (G in billions) VALUE AT OUR CORE 2015e 2016e Accelerated Plan Longer-term Growth in DWGOM $2.8 Bn $2.9 Bn $3.8 Bn NOTE: Amounts indude. pcorshed Interest and GBA = estimate. See Cauti
Slide 42: Adjusted EBITDA Reconciliation
FREEPORT-McMoRan Adjusted EBITDA Reconciliation VALUE AT OUR CORE Gin millions) ‘Mont Q2 2015 Trailing Net loss attributable to common stock $(1,851) (6,625) Interest expense, net 149 600 Income tax benefit, (687) (1,743) Depredation, depletion and amortization 890 3713 Impairment of oil and gas pro
Slide 43: O&G Adjusted EBITDA Reconciliation
FREEPORT-McMoRan O&G Adjusted EBITDA ReconGiiation VALUE AT OUR CORE Gn millions) Qi 2015 Q22015 Net loss before income taxes $3,517) $(2,983) Interest expense, net 38 40 Depredation, depletion and amortization 530 485 ‘Impairment of ail and gas properties 3,104 2,686 losses 48 95 v7 2 ‘Accretion ex