Freeport-mcmoran, Inc. · NYSE:FCX
Freeport-mcmoran — Freeport Mcmoran Copper & Gold — Q2 2008 Earnings Presentation
43 slides from Freeport-mcmoran's earnings presentation, Jul 23, 2008
Slide 1: Freeport-McMoRan Copper & Gold
PORT- Mc COPPER & Gol FCX $ : bth = LISTED July 22,2008 pSE: >
Slide 2: Cautionary Statements
FREEPORT-McMoRAn COPPER & GOLD Cautionary Gratencnts ales Forward-Looking Statements This presentation contains forward-looking statements in which we discuss factors we beleve may affect our perfomance in the future. Forward-looking statements are all statements other than historical facts, such as
Slide 3: Sales Data and Financial Results
FREeport-McMoRan [V8 Copper £ GoLD Sales Data 2008 2Q07 Copper Consolidated Volumes (am ibs) 942 1,010 Average Realization (per ib) $3.85 $3,347 Gold Consolidated Volumes (0200's ozs) 265 913 Average Realization (per oz) $912 $659 Molybdenum Consolidated Volumes (mm ibs)? 20 15 Average Realization (
Slide 4: 2Q08 Regional Data
FREeport-McMoRan [V8 Copper £ GoLD 2Q08 Regional Data (per pound of copper} North South . America America. Indonesia Consolidated Unit Cash Costs Site Production & Delivery $1.84 $1.15 $1.90 $1.59 Royalties 0.00 0.00 0.13 0.03 Treatment Charges 0.10 0.19 0.28 0.18 By-product Credits (0.70) (0.12) (0
Slide 5: Strong Markets
FREeport-McMoRan [V8 Copper £ GoLD Strong Markets LME Copper Price 000’s Metric Tons punog .Bd s1uaD, = LME & COMEX Exchange Stocks* Jan$0 Jul Jon00 Ju40 fn-O1 JulOH Jan42 Jul42 Jan Jul63 Jan lO Jon5 Jul0S Jan JulMG san? JAO7 san Sul 8 “LME and Comex, excluding Shanghai stocks, producer, consumer an
Slide 6: 2008 Outlook
FREEPORT-McMoRAn COPPER & GOLD 2008 Outlook > Sales Outlook: ° Copper: 4.1 Billion Ibs, 1) ¢ Gold: 1.4 Million ozs, ¢ Molybdenum: 75 Million Ibs. >» Modeled Operating Cash Flows @): Approximately $6.0 Billion for 2008 = Expect Working Capital Use in 2008 of ~ $1.8 Billion, Including $2.1 Billion Use
Slide 7: Development Project Update: North America - Copper
FREEPoRT-McMoRan COPPER & GOLD Developsnarofets jpdate North America - Copper ~ Safford Mine Development Miami Mine Restart ¢ Major new mine in Arizona ¢ Restart of the Miami mine completed ¢ 100MM Ibs Cu/year by 2010 ¢ SX/EW facility continues to ramp-up to full rates; produced * ~$100MM project, p
Slide 8: Development Project Update: North America - Molybdenum
Development Project Update North America.- Molybdenum Climax Mine Restart e w$500MM “brownfield” project = Open-pit operation = Construction of new mill with restart by 2010 = Major permits received = Construction activities commenced e Initial annual production ~30mm Ibs e Largest, highest-grade un
Slide 9: Development Project Update: South America
Development Project Update South America El Abra Sulfide ¢ Large sulfide mineral deposit underlying current oxide pit ¢ New leach pad & modifications to existing crushing plant; construction to begin in the second half of 2008 e Extends mine life 10+ years « Provides 325MM lbs copper/ year aggregate
Slide 10: Grasberg
“Grasberg Mill Complex NOTE: FCX has 3 90.64% ownership interest in Grasberg Underground Mine Development DOZ Expansion - Operated above 50K capacity at record 66K mt/d in 2Q08 - Further expansion to 80K under way ith targeted completion by 2010 Initiating mine development activities at Grasberg Blo
Slide 11: Tenke Fungurume Mine
Tenke Fungurume Mine extona ¢ Initial production target — 2H09; ¢ Engineering, procurement & construction Aggregate annual production of ies continue; concrete work, steel 250MM lbs Cu & 18MM Ibs Co tank erection, structural steel & logistics/ oe infrastructure development + Initial Reserves at 12/3
Slide 12: Development Project Update: Democratic Republic of Congo
FREeport-McMoRan [V8 Copper £ GoLD Development Project Update Democratic Republic of Congo Bien eee vem 6Tenke Fungurume eElectrowiniiay, fe Construction Site, 2008
Slide 13: A World of Opportunities
FREeport-McMoRan 3. A World of Opportunities Exploration Targets in Major Mineral Districts 80 drill¥igs operating around the world Safford /Lone Star /Morenct District SW US Songs J Thidonesia } 5 Attica ¢ 13 rigs South T9higs America 15 rigs
Slide 14: Exploration
FREEPoRT-McMoRan COPPER & GOLD ‘ie Explorati fn Aggregate 2008e Exploration: ~$240 million North America Lone Star, Morenci & Others Africa Indonesia Tenke Deep Grasberg, Fungurume Kucing Liar, & & Kisanfu other targets outside of Block A e = estimate. Pleare see cactionary statement Australasia & O
Slide 15: Exploring Our World of Opportunities
FREeport-McMoRan V8 Copper £ GOLD Exploring Our World of Opportunities North America, South America and Africa* Drill Rigs Drill Meters Reserves (number) (000’s meters) (billion Ibs CuEq) @ 144° Potential Additions J in Medium Term +80 billion Ibs Cua = May December 2006: 20082 PD Reserves. PD Reser
Slide 16: Greenfield Opportunities in our Brownfield Locations
FREEPORT-McMoRAn srneseee "Greenfield Opportunities in our Brownfield Locations North America, South America and Africa Drilling adjacent to existing ore bodies Focused on adds to reserves & mineralized material > Drilling >» Mine planning > Expansion projects Major Opportunities > Morenci > Bagdad
Slide 17: Morenci Opportunities
FREeport-McMoRan [V8 Copper £ GoLD Morenci Opportunities ¢ Potential to add to reserves by roughly 2/3rds in medium term ¢ Significant long-term potential ¢ Drill program at Sun Ridge, Garfield and Morenci pits (in-fill and step-out) e Expansion studies "
Slide 18: Bagdad Opportunities
FREeport-McMoRan [V8 Copper £ GoLD Bagdad Opportunities ¢ Potential to triple reserves in medium term ¢ Significant long-term potential ¢ In-fill and step-out drill program e Expansion Studies 8
Slide 19: Sierrita Opportunities
FREeport-McMoRan [V8 Copper £ GoLD Sierrita Opportunities Bune ¢ Potential to double reserves in medium “Current term oe Gp BN Potential ¢ Significant long-term N ae potential i rs + Z * 400 ft ~ nF — ¢ Drill program focused below and north of pit e Expansion Studies 19
Slide 20: Cerro Verde Opportunities
FREeport-McMoRan [V8 Copper £ GoLD Cerro Verde Opportunities ¢ Potential to double reserves in medium term ¢ Significant long-term potential ¢ Infill and deep exploration drill program ¢ Expansion studies
Slide 21: Tenke Opportunities
FREEPORT-McMoRAn COPPER & GOLD Tenke Opportunities Accelerating. Exploration — ¢ Potential to triple reserves in medium term ¢ Significant long-term potential ¢ Expansion studies 24
Slide 22: Papua Opportunities
FREeport-McMoRan [V8 Copper £ GoLD Papua Opportunities ¢ Drill programs adjacent to existing ore bodies as well as in highly prospective exploration areas outside current operations ¢ Opportunities to add to reserves in Indonesia
Slide 23: Sales Profile 2007 - 2010e
FREEPORT-McMoRAn COPPER & GOLD Sales Profile 2007 - 2010e Gold Sales (million ozs, 3 23 24 24 2) 19 14 1 0 2006 2007 2008e «= «2009e = -2010e Pro Pro Forma Forma* ‘Fer Consolianed gol sates incfce spprosimately 185 orn 2006, 220 & ox n 2007, 45 & oF 4 2008e, 210407 92008 298 210 029 20i0e fr ino ere
Slide 24: 2008e Quarterly Payable Metal Sales
FREEPORT-McMoRAn COPPER & GOLD 2008e Quarterly Pa yable Metal Sales Copper Sales (million Ibs) Gold Sales (thousand ozs) Grasberg yrade sec 1,250 1225 750 i 575 500 315 1,000 942 280 265 250 0 750 1go8 2908 aqose agose ‘Tite? CansoIaTeT go sles ince approsimately 29 & on 1008, 27 & orn 2908, SB horn
Slide 25: 2008e Sales and Unit Production Costs by Region
FREeport-McMoRan [V8 Copper £ GoLD 2008e Sales and Unit Production Costs by Region 2008e Sales by Region North America South America Indonesia 1,425 2.500 4,175 13 50 = on Cu Mo | Au, Cu Au mm Ibs mim Ibs ais ey, om Ibs a North South (per pound of copper} America America Indonesia Consolidated Unit
Slide 26: Average Annual EBITDA and Operating Cash Flow at Various Copper Prices
at Various petits Prices” Average Annual EBITDA (8900 Gold & $30 Molybdenum) $15) (US$ billions) $13 $11 $9 $7 $5 Cu $3.00/Ib Cu $3.50/Ib Cu $4.00/Ib Average Annual Operating Cash Flow ($900 Gold & $30 Molybdenum) $10) (US$ billions) $8 $6 $4 2 $0 Cu $3.00/Ib Cu $3.50/Ib Cu $4.00/Ib ‘Note: Answalved
Slide 27: Sensitivity to Commodity Prices
FREeport-McMoRan [V8 Copper £ GoLD Sensitivity to Commodity Prices Annual Fin: fal Impact Net Operating EBITDA Income Cash Flow (US$ millions) Copper: -/+ $0.20/Ib $850 $490 $575 Molybdenum: -/+ $2.00/Ib $140 $100 $100 Gold: -/+ $50/ounce $90 $45 $50 ‘Foie Anical BaaasiTingact based on estimated ave
Slide 28: Capital Expenditures
FREEPoRT-McMoRan Coprer 2 GoLo 7% a cr : Capi a EB penditures a @ Major Projects @All Other (uss billions) $3.0 $2.5 $2.5 $2.0 $1.55 $1.0 $0.5 $0.0 2007 * 2008e 2009e 2010e "Includes PD expenditures beginning March 20, 2007 ‘Note: Incledes capitalzed interest. = estimate, Please see cautiona'y state
Slide 29: July 2008 Board Action
FREEPORT-McMoRAn COPPER & GOLD << A ee ” Ys July 2008 Board Action > Increased Common Stock Dividend From $1.75 to $2.00/Share per Annum >» Increased Open Market Share Purchase Program to 30 Million Shares > FCX is Committed to Maintaining a Strong Financial Position >» Committed to Long-Standing Tr
Slide 30: Excess Cash Flow
FREEPoRT-McMoRan COPPER & GOLD eee ae ‘Excess Cash Flow” ~ (Bin billions, except — ‘and molybdenum prices) : . 55 we ais 5 s Copper Sensitivities with g $900 Gold/$30 Molybdenum z $4 J & Available for o investmentis/ 5 $3 | debt reduction/ x shareholder 3 returns é E 92 | = 3 ga a é $0 - $3.00 $3.50
Slide 31: 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 >» World Class, Long-lived, Geographically Diverse Operations > Attractive Project Pipeline Supports Growing Production Profile > S
Slide 32: Slides
Slides
Slide 33: Grasberg District Ore Bodies
FREeport-McMoRan [V8 Copper £ GoLD Grasberg District Ore Bodies + At year-end 2007, we arrived at the start of the Grasberg BC terminal + In 2008, we have begun development of Grasberg BC infrastructure December 2007 5.5 km’ from the Portal Grasberg Block Cave “Spur” MLZ wer acce gsan CO COW A Ore B
Slide 34: Grasberg Open Pit
FREEPORT-McMoRAn 2" Coppers GOL Grasberg Open Pit
Slide 35: PT-FI Mine Plan
FREEPORT-McMoRAn COPPER & GOLD PT-FI Mine Plan PT-FI’s Share of Metal Sales, 2008e-2012e Copper, billion lbs Gold, million ozs 2008e — 2012e PT-Fi Share | 2008e — 2012e PT-Fi Share Total: 6.0 billion ibs Total: 7.8 million ozs Annual Average: 1.2 billion ibs Annual Average: 1.6 million ozs 2.0 2.0 1
Slide 36: 7S is the Primary Ore Pushback in 2008
FREEPORT-McMoRAn COPPER & GOLD 7S is the Primary Ore Pushback in 2008 0.25 - 0.99% CuEq 1.01 19% CuEG 19% CuEG uEq
Slide 37: Copper Equivalent
FREEPORT-McMoRAn COPPER & GOLD g Seq » Copper Equivalen
Slide 38: FREEPORT-McMoRAn
FREEPORT-McMoRAn COPPER & GOLD
Slide 39: 7S is the Primary Ore Pushback in 2008
FREEPORT-McMoRAn COPPER & GOLD g Seq » Copper Equivalen 7S is the Primary Ore Pushback in 2008 oc i
Slide 40: Grasberg Plan View
FREEPORT-McMoRAn COPPER & GOLD Grasberg Plan View
Slide 41: Copper Equivalent
FREEPORT-McMoRAn COPPER & GOLD ¥ g: » Copper Equivalen:
Slide 42: CuEq cross-section
FREEPORT-McMoRAn COPPER & GOLD 99% CUEq 99% CuEq 99% CUEG >3.00% CuEq > ON is in ore north of this cross-section
Slide 43: CuEq cross-section
FREEPORT-McMoRAn COPPER & GOLD 99% CUEq 99% CuEq 99% CUEG >3.00% CuEq > ON is in ore north of this cross-section
Freeport Mcmoran Copper & Gold — Q2 2008 Earnings Presentation on 6ix