Freeport-mcmoran, Inc. · NYSE:FCX
Freeport-mcmoran — Freeport-McMoRan Copper & Gold — Credit Suisse 2009 Global Steel and Mining Conference
26 slides from Freeport-mcmoran's conference presentation, Sep 23, 2009
Slide 1: 2009 Global Steel and Mining Conference
2009 Global Steel and Mining Conference Kathleen L. Quirk Executive Executive Vice Vice President President & & CFO CFO London September 23, 2009 www.fcx.com
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
Slide 3: Core Assets
Core Assets Long-Lived Reserves with Growth Potential Geographically Diverse Operations Financially Strong Flexible Operating Structure Experienced Team Focused Strategy 3
Slide 4: World's Leading Copper Producers
World’s Leading Copper Producers Top 10 Copper Producers (2009E) (000 t) 2,000 1,800 1,600 1,400 1,200 1,000 800 600 400 200 0 Codelco FCX BHP Billiton Xstrata Rio Tinto Anglo Southern KGHM Norilsk First Quantum American Copper ____________________ Source: Brook Hunt 2Q09 Report. Rankings based on n
Slide 5: World Class Copper Discoveries Are Extremely Rare
World Class Copper Discoveries Are Extremely Rare Recoverable Copper Reserves 2009E Copper Production Million metric tons 0 5 10 15 20 25 Thousands metric tons 0 200 400 600 800 1,0 0 0 Grasberg Complex - 1988 Escondida - 1979 KGHM Polish Copper - 1957 Chuquicamata - 1910 Escondida - 1979 Grasberg C
Slide 6: Geographically Diverse
Geographically Diverse Major Mine Operations & Development Projects All major assets majority-controlled and operated North North America America11 Copper Reserves Copper/Gold/Silver Cu 28.3 billion lbs Mo 2.1 billion lbs Molybdenum Sales Cobalt Grasberg (90.64%) Cu 1.1 billion lbs Reserves Mo 56 mi
Slide 7: Consolidated Proven & Probable Reserve Growth
Consolidated Proven & Probable Reserve Growth Copper Molybdenum Gold billion lbs billion lbs million ozs Reserves @ 12/31/07 93.2 2.04 41.0 Additions/revisions* 12.8 0.51 0.3 Production (4.0) (0.07) (1.3) Net change 8.8 0.44 (1.0) Reserves @ 12/31/08 102.0 2.48 40.0 * as % of 2008 production 320% 70
Slide 8: A World of Opportunities
A World of Opportunities Exploration Targets in Major Mineral Districts Safford/Lone Star/Morenci Cerro Verde Tenke Fungurume/Africa Grasberg/Indonesia District SW US Indonesia Africa South America 8
Slide 9: Markets
Markets 2,000 400 1,750 350 1,500 300 000’s Metric Tons Cents Per Pound LME Copper Price 250 1,250 1,000 200 750 150 500 100 250 50 LME & COMEX Exchange Stocks* 0 0 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Ju
Slide 10: Twelve Months in Review
Twelve Months in Review Base Metal Performance Mid-September Through Year-end 2008 4Q08 0% Financial Market Turmoil Sharp & Severe Economic Downturn -25% Concerns About China -37% -39% All Asset Classes Affected -50% -42% -44% -48% -58% -75% 2009 Zinc Nickel Aluminum Tin Lead Copper Change i
Slide 11: Responding to Changing Conditions
Responding to Changing Conditions Revised Operating Plans Aggressive Reduction in Costs & Capital Spending Adjustments to Financial Policy Protect Liquidity Preserve Assets & Future Growth Options Strongly Positioned Operationally and Financially to Respond to Improved Conditions – Disci
Slide 12: Strong Operating & Cost Performance in 1H09
Strong Operating & Cost Performance in 1H09 y Strong Operating Performance Consolidated Site Production & Delivery Access to high-grade section of the (excludes Africa) Grasberg Open Pit $ per pound of copper Solid Results in the Americas 31% Tenke start-up Reduction $1.53 y Achieving Cost Red
Slide 13: 1H09 Highlights
1H09 Highlights Sales Data 1H09 1H08 Copper Consolidated Volumes (mm lbs) 2,122 1,853 Average Realization (per lb) $2.03 $3.77 Site Production & Delivery Unit Costs (per lb) $1.05 $1.53 Unit Net Cash Costs (per lb) $0.54 $1.16 Gold Consolidated Volumes (000’s ozs) 1,382 545 Average Realization (per
Slide 14: 2009e Quarterly Payable Metal Sales
2009e Quarterly Payable Metal Sales Gold Sales (thousand ozs) Copper Sales (million lbs) 837 1,250 800 545 550 1,102 600 475 1,020 400 1,000 910 915 200 0 1Q09 2Q09 3Q09e 4Q09e 750 ____________________ Note: Consolidated gold sales include approximately 53 k oz in 1Q09, 81 k oz in 2Q09, 56 k oz in 3
Slide 15: Sales Profile 2007 - 2010e
Sales Profile 2007 - 2010e Gold Sales (million ozs) Copper Sales (billion lbs) 3 2.4 2.3 5 2.0 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, 240 k oz in 2009e, and 200 k oz i
Slide 16: 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 2.3 1,380 1,330 1,130 56 Au Cu Mo Cu mm ozs Cu Au mm lbs mm lbs mm lbs 0.1 mm lbs mm ozs North South (per pound of copper) America America Indonesia Consolidated (4) Cash Unit Costs (2) Si
Slide 17: EBITDA and Cash Flow at Various Copper Prices
EBITDA and Cash Flow at Various Copper Prices 2010e Annual EBITDA ($900 Gold & $10 Molybdenum) $10 (US$ billions) $8 $6 $4 $2 $0 Cu $2.00/lb Cu $2.50/lb Cu $3.00/lb 2010e Annual Operating Cash Flow (excluding Working Capital)* ($900 Gold & $10 Molybdenum) $6 (US$ billions) $4 $2 $0 Cu $2.00/lb Cu $2
Slide 18: Sensitivities 2010e
Sensitivities 2010e Operating Change EBITDA Cash Flow (US$ millions) Copper: -/+ $0.10/lb $375 $260 Molybdenum: -/+ $1.00/lb $55 $45 Gold: -/+ $50/ounce $95 $55 Diesel (1): -/+ 10% $35 $20 Purchased Power (2): -/+ 10% $40 $25 Currencies (3): +/- 10% $110 $65 ____________________ (1) $1.85/gallon bas
Slide 19: Capital Expenditures
Capital Expenditures (1) Major Projects All Other (US$ billions) $3.0 $2.7 $2.5 1.1 $2.0 $1.5 $1.4 0.6 $1.0 $1.0 1.6 0.5 $0.5 0.8 (2) (3) 0.5 $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
Slide 20: Tenke Fungurume
Tenke Fungurume Development Activities First Copper in March 2009 20
Slide 21: Tenke Fungurume
Tenke Fungurume Project Highlights y Largest Investment in DRC y World-Class Design & Construction y Significant Infrastructure Upgrades y Expanding Social & Community Programs Workers install a liner for the Tailings Storage Facility y Project Provides Important Benefits: Employment Local Servi
Slide 22: Underground Mine Development in Indonesia
Underground Mine Development in Indonesia Grasberg District Ore Bodies y 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 y ~$180MM in aggregate capex Grasberg Block Cave for underground dev
Slide 23: El Abra Sulfolix Project
El Abra Sulfolix Project y Large sulfide mineral deposit underlying current oxide pit y New leach pad & modifications to existing crushing plant y Extends mine life 10+ years y Provides ~300MM lbs copper/year aggregate to replace oxides y $300mm to be spent in 2010/2011 El Abra Pit El Abra Original
Slide 24: Balance Sheet
Balance Sheet Debt at 6/30/09: $7.2 Billion; Cash at 6/30/09: $1.3 Billion Significant Liquidity Strong Credit Metrics No Near-term Maturities Redeemed $340 MM 6⅞% Senior Notes in August 2009 Converted $832 Million in Preferred Stock to Common Equity in September 2009 Opportunistic Deb
Slide 25: Financial Policy
Financial Policy Maintain Strong Balance Sheet & Liquidity Position Aggressive Cost Management Disciplined Approach to Capital Spending Board to Review Financial Policy on an Ongoing Basis 25
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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