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GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc.

Freeport-Mcmoran Inc. · Nov 11, 2014 · 31 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 1
    Kathleen L. Quirk Executive Vice President & CFO www.fcx.com November 11, 2014
  2. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 2
    FCX A Premier U.S. Based Natural Resource Company Worlds Largest Publicly Traded Copper Producer Long-lived Reserves with Large Incremental Resources High-Quality U.S. Based Oil & Gas Assets Strong Margins & Cash Flows Growing…
  3. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 3
    FCXs Global Footprint Major Operations & Development Projects North America1 Reserves Cu 36.2 bn lbs Mo 2.55 bn lbs Copper Oil & Gas 861 MMBOE2 Sales Copper/Gold/Silver Cu 1.67 bn lbs Molybdenum Mo 95 mm lbs3 Grasberg (90.64%)…
  4. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 4
    Geographic & Commodity Mix 2015e/2016e EBITDA* North America Mining 50% 74% South America 15% Africa Indonesia Oil & Gas 7% 28% 26% * Based on 2015e/2016e average EBITDA of 13 bn assuming annual pricing of 3.25/lb Cu,…
  5. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 5
    Visible Organic Growth Mining Oil & Gas Targeting 5+ Billion Pounds Growing Production Profile in Annual Cu Production by 2016 Established Basins (34% Increase from 2013) Substantial Production Capacity Advanced Stage Brownfield…
  6. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 6
    Committed to Balance Sheet Management Strong Track Record Large Resource Base with Strong 9/30/2014 Balances Cash Flows and Capital Discipline ( in bns) 2014 Completed/Announced Asset Sales 5 bn in Gross Proceeds (4.3 bn net 19.3…
  7. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 7
    Supply Side Challenges in Copper Persist Wood Mackenzies Current Outlook for Refined Production for 3-year Period of 2013 2015 is 2 mm Tonnes Lower Than December 2012 Outlook (mm tonnes) 2013 2014e 2015e December 2012 Forecast…
  8. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 8
    Copper Markets Long-term Fundamentals Support Positive Outlook Total Copper Consumption 40 Assuming 2.3% Global Growth +7.6 mm Over Next 10 Years, Copper 30 +5.4 mm 27% Cu in mm tonnes 24% Market Expected to Grow by +7.6 mm…
  9. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 9
    World Class Copper Discoveries Are Extremely Rare Recoverable Copper Reserves 2014e Copper Production Million metric tons Thousand metric tons 0 5 10 15 20 25 30 35 0 200 400 600 800 1000 1200 1400 1981 Escondida - 1981 1981…
  10. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 10
    Portfolio of World Scale Mines Positive Exploration Results Big Mines Get Bigger Mines with Potential Capacity for 1 billion lbs of copper per annum* Morenci Grasberg Tenke Cerro Verde Fungurume El Abra * Grasberg capable…
  11. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 11
    Value Creation Focus INVESTMENT CASH MINERAL RESERVE IN ATTRACTIVE PRODUCTION DEVELOPMENT FLOWS/ RESOURCES ADDITIONS GROWTH PROJECTS RETURNS FCX Consolidated Copper Resources at 12/31/2013 (a) Recoverable Reserves 111 bn lbs…
  12. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 12
    Brownfield Development Projects Morenci Mill Expansion Cerro Verde Mill Expansion 1.6 billion 4.6 billion Construction substantially complete Detailed engineering & procurement Commenced operations in May 2014 complete; construction…
  13. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 13
    Grasberg BC & DMLZ Underground Mine Development History of PT-FI UG Operations Completed development on access to underground ore bodies Recognized Global Leader in Underground Mining & Development Completed 122 km of development…
  14. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 14
    Indonesian Matters Resumed Export Shipments in August 2014 Working Cooperatively with Government Regarding Amended COW Positive Long-term Partnership Operations Provide Significant Benefits to Indonesian Economy All Rights…
  15. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 15
    Strong Execution Last 12-month Oil & Gas Results Strong Operating/Financial Performance in Brent and HLS Pricing per Bbl 12-month Period Ended September 30, 2014 150 LTM Adjusted EBITDA of 3.1 Billion 125 100 Sales: 61.3 MMBOE…
  16. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 16
    Oil & Natural Gas Hedging Positions Oil Hedges Indexed to Brent 4Q 2014 100% Hedged 2015 Puts Unhedged 75 MBbls/d 30 MBbls/d 21% 90 floor 95 floor 70 limit 75 limit 5.74 ADP 6.09 ADP Puts 5 MBbls/d 100 floor 84 MBbls/d 80…
  17. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 17
    Reserves & Resource Potential Year-end 2013 Proved Reserves & Net Unrisked Resource Potential 4.4 3.3 18.1 5.1 0.4 0.2 0.2 N/A 0.3 N/A Reserves Resource Reserves Resource Reserves Resource Reserves Resource Reserves…
  18. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 18
    Strategic Position in Deepwater Gulf of Mexico Major Exploration/ Operating/ Development Exploitation Producing Assets Projects Opportunities Significant Current Oil Financially Attractive Strategic Acreage Near Production…
  19. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 19
    Inboard Lower Tertiary/ Cretaceous Activities Industry Leader in Emerging New ILT Trend Cretaceous Tuscaloosa Trend Cumulative Production 3.1 TCF, 121 mmbc Tuscaloosa Trend LOUISIANA Farthest Gate West Lineham Creek…
  20. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 20
    Sales Profile Copper Sales (billion lbs) Gold Sales (million ozs) 3 2 2.5 6 1 1.2 1.2 1.3 5.5 0 2013 2014e 2015e 2016e Note: Consolidated gold sales include 123k ozs in 2013, 120k ozs 4 4.4 in 2014e, 125k ozs in 2015e and…
  21. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 21
    EBITDA and Cash Flow at Various Copper Prices Average EBITDA (1,200 Gold, 10 Molybdenum & 100 Oil) (US billions) 20 15 10 5 2015e/2016e Average 0 Cu 3.00/lb Cu 3.50/lb Cu 4.00/lb Average Operating Cash Flow (excluding…
  22. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 22
    Capital Expenditures (1) (US billions) 8 7.5 7.5 6.5 6 Oil & Gas 3.5 3.4 4.0 4 Major Projects TOTAL 2.7 (2) 2 3.0 MINING 4.0 1.4 4.1 2.5 Other Mining 1.3 1.1 1.1 0 2014e 2015e 2016e (1) Capital expenditure estimates…
  23. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 23
    Summary A Strong & Focused Organization Maximize Total Shareholder Returns Strong Management of the Base Operational Excellence Achieve Production Targets Effective Cost and Capital Management Manage HS&E and Other Inherent…
  24. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 24
    Oil & Gas Portfolio Optimization Sold Eagle Ford Shale Interests Net Resource Potential Comparison for 3.1 bn in June 2014 (MMBOE) Reinvested 1.4 bn in Deepwater GOM 1,300 Interests, Including: - Lucius Oil Development (5.1% WI)…
  25. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 25
    Deepwater Gulf of Mexico Focus Areas Development/Exploration Project Inventory Net Unrisked Louisiana Resource Potential Asset Area (Billion BOE) Green Canyon Area 1.6 Marlin/Horn Mountain Area 0.6 Dorado Marlin Vito Area 1.0…
  26. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 26
    Lucius & Heidelberg Deepwater GOM Development Projects Commissioning Work is in Progress First Production Expected in 4Q 2014 300+ MMBOE Gross Resource Potential Processing Capacity 80,000 BOPD 450,000 MCFD FM O&G 25.1% WI Lucius…
  27. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 27
    Sensitivities (US millions) 2015e/2016e Operating Change EBITDA Cash Flow Copper: +/- 0.10/lb 480 335 Molybdenum: +/- 1.00/lb 90 70 Gold: +/- 50/ounce 90 50 Oil Sales: +/- 5/bbl(1) 225 180 Oil Sales Net of Diesel Costs:(1,2)…
  28. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 28
    2014e Operating Estimates 2014e Unit Production Costs (per pound of copper) North South America America Indonesia Africa Consolidated Cash Unit Costs (1) Site Production & Delivery (2) 1.85 1.61 2.72 1.55 1.91 By-product Credits…
  29. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 29
    2H 2014e Oil & Gas Operating Estimates Madden & Operating Cost: 1.85/Mcfe California Haynesville Pricing: NYMEX Operating Cost: 36/bbl Pricing: Brent Based Gulf of Mexico Operating Cost: 18/bbl Pricing: HLS/NYMEX 2H 2014e…
  30. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 30
    Reconciliation of Cash Margin (Non-GAAP) to Gross Profit (GAAP) The following table reconciles cash margin, a non-GAAP measure, to gross profit (GAAP) for the trailing twelve months ended September 30, 2014. Management believes this…
  31. GLOBAL METALS MINING MATERIALS CONFERENCE – Freeport-Mcmoran Inc. – slide 31
    Reconciliation of Cash Margin (Non-GAAP) to Gross Profit (GAAP) The following table reconciles cash margin, a non-GAAP measure, to gross profit (GAAP) for the nine months ended September 30, 2014. Management believes this presentation…

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