Freeport-mcmoran, Inc. · NYSE:FCX
Freeport-mcmoran — Freeport-McMoRan Copper & Gold — Deutsche Bank Industrials Conference 2010
23 slides from Freeport-mcmoran's conference presentation, Jun 24, 2010
Slide 1: 2010 Industrials Conference
2010 Industrials Conference Kathleen L. Quirk Executive Vice President & Chi f Fi Chief Financial i l Offi Officer PROVEN PERFORMANCE SHINING FUTURE June 24, 2010 www.fcx.com
Slide 2: Cautionary Statement Regarding Forward-Looking Statements
Cautionary Statement Regarding Forward-Looking 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 statemen
Slide 3: Investment Highlights
Proven Performance,, Shining g Future Investment Highlights Premiere Copper, Gold & Molybdenum Producer Long-Lived Reserves with Growth Options Flexible Operating Structure Geographically G hi ll Diverse Di Strong Financial Position Experienced Team 3
Slide 4: Geographically Diverse
Geographically g p y Diverse Major Mine Operations & Development Projects All major assets majority-controlled and operated North America1 Copper Reserves Copper/Gold/Silver Cu 27.7 billion lbs Mo 2.1 billion lbs Molybdenum Sales Cobalt Grasberg G b (90.64%) (90 64%) Cu 1.0 billion lbs Reserves Mo 6
Slide 5: Markets
Markets 2,000 400 1,750 350 1 500 1,500 300 0’s Metric Tons s LME Copper Price Cents Per Pou 1,250 250 1,000 200 750 150 und 500 100 000 250 50 0 LME & COMEX Exchange Stocks* 0 Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- 99 99 00
Slide 6: World Class Copper Discoveries Are Extremely Rare
World Class Copper Discoveries Are Extremely Rare Recoverable Copper Reserves 2010e 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 7: Copper Reserves & Mineralized Material
Copper Reserves & Mineralized Material as of 12/31/09 billion lbs of copper 12/31/09 / / Copper Reserves 226 by Geographical Region Mineralized 122 North Material (b) billion America (contained copper) lbs 27% 104 at $2.00 Cu price South America Indonesia 33% 33% Reserves at $1.60 Cu price 7% Reserv
Slide 8: Development Project Update
Development Project Update North America Morenci Mill Restart & Ramp Ramp-up up • Process sulfide ore being mined • Successfully restarted mill in March & a p g up rates ramping ates – 50 50K mt/d t/d by 2011 0 Increase Mine Rate • Ramping up from the current rate of ~450K 450K to 635K mt/d (500K to
Slide 9: Development Project Update
Development Project Update North America Miami Mine Restart • Began stripping activities in 1Q10 • Ramp up to 100MM lbs Cu/year by second half 2011 • $ $40MM project, p j , primarily p y mining g equipment • 12/31/09 reserves of 600MM lbs Cu S ff d S Safford Sulphur l h B Burner • Sulphur Burner at
Slide 10: Development Project Update
Development Project Update South America Cerro Verde Expansion • $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 • Evaluating large scale concentrator expansion Potential to more than double the existing facility Feasibil
Slide 11: Long-Term Underground Mine Development in Indonesia
Long-Term Underground Mine Development in Indonesia Significant undeveloped underground reserves Aggregate A t reserves off 41 billion billi lbs lb Cu C & 35 million illi ozs Au A DOZ expanded to 80,000 t/d Big Gossan mine – full rates of Grasberg 7,000 t/d by late 2012 open pit Grasberg B
Slide 12: Tenke Fungurume
Tenke Fungurume g Achieved design Cu production rates; start-up issues on Co circuit and SO2 plant b i being addressed dd d At full rates (initial phase), aggregate annual metal of 250MM lbs Cu & over 18MM lbs Co Sold 66MM lbs Cu & 3MM lbs Co in 1Q10 Exploration activities continue to suppor
Slide 13: Climax Restart
Climax Restart Preparing for resumption of construction activities One of the most attractive primary molybdenum development projects in the world – large scale production capacity, i attractive i cash h costs and d ffuture growth h options i Initial annual capacity of 30mm pounds $700mm pro
Slide 14: Current Projects Under Evaluation
Current Cu e t Projects ojects Under U de Evaluation a uat o North America Tenke Fungurume • Chino Restart • Debottlenecking • Further increases to Morenci • Further oxide expansion mining rate • Sulphide development • Plans for Twin Buttes/ Sierrita district • Climax • Major mill projects for sulfi
Slide 15: FCX Copper Projects
FCX Copper pp Projects j billion lbs copper annually Replacement p New Copper pp Projects Sources El Abra Sulfolix SA Potential 0.3 P j t Projects 0.75 Tenke 0.25 Grasberg Expansions Underground 0.5 0.3 NA Potential 1.1 NA Restarts Projects 1 4 billion 1.4 billi lbs lb Cu C 1 8 billion lbs Cu 1.8 Ot
Slide 16: First Quarter Highlights
First s Quarter Qu Highlights g g s Solid Volume and Cost Performance Strong g Cash Flows and Financial Results Repaid p $1.3 Billion in Debt YTD* Advanced Capital Projects Increase in Dividend * As of April 1, 2010. Takes into account the April 1, 2010 redemption of $1.0 billion in senior
Slide 17: Near-term Sales Profile
Near-term Sales Profile Excludes current projects under evaluation Copper Sales (billion lbs) Gold Sales (million ozs) 5 1.9 2 1.8 1.4 3.9 4.0 4 38 3.8 1 0 3 2010e 2011e 2012e ____________________ Note: Consolidated gold sales include approximately 177 k oz in 2010e, 190 k oz in 2011e, and 140 k oz
Slide 18: 2010e Quarterly Payable Metal Sales
2010e Q Quarterly y Payable y Metal Sales Gold Sales (thousand ozs) Copper Sales (million lbs) 1,250 800 675 600 478 1,060 390 400 1,000 960 950 270 200 830 0 1Q10 2Q10e 3Q10e 4Q10e 750 ____________________ Note: Consolidated g gold sales include approximately pp y 47 k oz in 1Q10, Q , 25 k oz in 2Q
Slide 19: 2010e Sales and Unit Production Costs by Region
2010e Sales and Unit Production Costs by Region 2010e Sales by Region (1) North America South America Indonesia 1,280 1,235 1,035 1.7 62 (2) 01 0.1 Cu Mo Cu Au Cu Au mm lbs mm lbs mm lbs mm ozs mm lbs mm ozs 2009e 2010e 2 0 10 e 2 0 10 e 2 0 10 e 2010e North South ( (per pound d off copper)) America
Slide 20: EBITDA and Cash Flow at Various Copper Prices
EBITDA and Cash Flow* at Various Copper Prices EBITDA* ($1,000 Gold & $10 Molybdenum) $10 (US$ billions) $8 $6 $4 $2 $0 Cu $2.50/lb Cu $3.00/lb Cu $3.50/lb Operating Cash Flow (excluding Working Capital changes)* ($1,000 Gold & $10 Molybdenum) $8 (US$ billions) $6 $4 $2 $0 Cu $2.50/lb Cu $3.00/lb Cu
Slide 21: Capital Expenditures
Capital p Expenditures p (1) Excludes current projects under evaluation (US$ billions) Major j Projects j All Other $3.0 $2.7 $2.5 1.1 $2.0 $1.7 $1.6 $1.6 $1 5 $1.5 0.6 0.9 0.9 $1.0 1.6 (2) $0.5 1.0 (3) 0.8 0.7 (4) $0.0 2008 2009 2010 2010e 2011 2011e (1) Capital expenditure estimates will continue
Slide 22: Balance Sheet
Balance Sheet (US$ billions) Significant Liquidity $20 (1) $17.6 Strong Credit Metrics $15 No Near-term Maturities Total Debt $10 $7.4 (2) $5.1 $5 $0 At Time of PD Acquisition 12/31/08 3/31/10 in March 2007 Pro Forma Cash $3.4 $0.9 $2.7 Net Debt $14.2 $6.5 $2.3 (1) Pro Forma year-end 2006 tota
Slide 23: Financial Policy
Financial Policy o y Maintain Strong Balance Sheet & Liquidity Position Aggressive Cost Management Invest in Attractive Growth Projects Opportunistic Debt Repayment Board Action to Increase Common Stock Dividend: $1.20/share per Annum 23.7 MM Shares Remaining Under Open Market Share Purc
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