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Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc.

Freeport-Mcmoran Inc. · Jun 3, 2015 · 30 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. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 1
    6th Annual Global Industrials and Basic Materials Conference Kathleen L. Quirk Executive Vice President & CFO June 3, 2015
  2. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 2
    Value at Our Core 2014 Annual Report Highlights Substantial Values in Long-Lived, Geographically Diverse Natural Resources - Premier Portfolio of Global Mining Assets - High-Quality, U.S.-Based Oil & Gas Assets with Attractive…
  3. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 3
    FCXs Global Footprint Major Operations & Development Projects North America1 Reserves Cu 35.6 bn lbs Mo 2.42 bn lbs Copper Oil & Gas 635 MMBOE2 Sales Copper/Gold/Silver Cu 1.9 bn lbs Molybdenum Mo 95 mm lbs3 Grasberg (90.64%)…
  4. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 4
    Key Priorities Maintain Strong Balance Sheet & Liquidity Manage Operations and CAPEX to Maximize Cash Flow in Weak Market Environment Mitigate Funding Gap in Oil & Gas Evaluating IPO Alternative Complete Near-term Mining…
  5. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 5
    1Q15 Highlights Mining Oil & Gas Successful Ramp-up of Morenci Positive Drilling Results at Holstein Expansion Deep, Power Nap and King Significant Expansion of Record Quarterly Tenke Sales Resource Base Following Successful Phase…
  6. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 6
    Copper & Oil Markets Last 12 Months Copper Price History (/lb) Brent Crude Price History* (/bbl) 350 120 300 100 250 80 200 60 150 40 Copper Brent Crude (/lb) (/bbl) 12-Month Price Range 2.42 - 3.27 47 - 116 Current…
  7. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 7
    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 Escondida…
  8. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 8
    Copper Market Commentary Market Expectations for Surpluses Have Not Materialized China Slowing Growth Rate on Larger Base; Economic Stimulus U.S. Growing at Moderate Rate Economic Stimulus in Europe and Japan Continuing Supply…
  9. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 9
    Copper Markets Long-term Fundamentals Support Positive Outlook Total Copper Consumption 40 Assuming 2.5% Global Growth +7.6 mm Over Next 10 Years, Copper 30 +5.2 mm 28% Cu in mm tonnes 23% Market Expected to Grow by +7.6 mm…
  10. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 10
    Positioned for Margin & Free Cash Flow Growth Growing Copper Sales Profile Declining Unit Net Cash Cost Profile (millions of lbs) 2.00 ( per lb) 1,500 1.64 1.62 1.50 1,370 1.45 1,250 1.20 1,230 1.00 1,000 1,060 960 960 0.50…
  11. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 11
    Cerro Verde Mill Expansion Detailed engineering & major procurement activities complete To become worlds largest concentrating facility Construction advancing on schedule & approximately 70% complete Completion expected in late…
  12. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 12
    Indonesia Engaged in Active Discussions with Government to Amend COW Positive Long-term Partnership Economic Engine for Development of Papua Operations Provide Significant Benefits to Indonesian Economy All Rights Under COW to…
  13. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 13
    Grasberg BC & DMLZ Underground Mine Development Completed development of access to underground ore bodies Expect DMLZ start-up in late 2015 & Grasberg BC in 2018 Key development activities include work on ore flow systems &…
  14. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 14
    Strategic Position in Deepwater Gulf of Mexico Major Exploration/ Operating/ Development Exploitation Producing Assets Projects Opportunities Significant Current Oil Financially Attractive Strategic Acreage Production with Strong…
  15. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 15
    Deepwater Gulf of Mexico Focus Areas Net Unrisked Louisiana Resource Potential 4.7 Billion BOE Dorado Marlin King Viosca Knoll Ram Powell Horn Mississippi Mountain Canyon Vito KOQV Green Canyon Power Nap Holstein Deep…
  16. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 16
    2015e Outlook Sales Outlook Unit Cost Copper: 4.2 Billion lbs. 1.53/lb(2) of Copper Gold: 1.3 Million ozs. 19/BOE Molybdenum: 95 Million lbs. Oil Equivalents(1): 52.3 MMBOE (67% Oil) Operating Cash Flows (3) Capital…
  17. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 17
    Sales Profile Copper Sales (billion lbs) Gold Sales (million ozs) 3 6 2 2.4 1.9 5.4 1 1.25 1.3 5.0 0 2014 2015e 2016e 2017e 4 4.2 3.9 Note: Consolidated gold sales include 123k ozs in 2014, 120k ozs in 2015e, 175k ozs in…
  18. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 18
    2015e Operating Estimates 2015e Unit Production Costs (per pound of copper) North South America America Indonesia Africa Consolidated Cash Unit Costs (1) Site Production & Delivery (2) 1.74 1.58 2.28 1.67 1.81 By-product Credits…
  19. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 19
    EBITDA and Cash Flow at Various Copper Prices Average EBITDA (1,200 Gold, 8 Molybdenum & 70 Oil) Significant Increase From 2015 15 (US billions) 10 5 2016e/2017e Average 0 Cu 2.50/lb Cu 3.00/lb Cu 3.50/lb Average…
  20. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 20
    Capital Expenditures (1) (US billions) 8 7.2 6.5 6 5.6 Oil & Gas 5.1 3.2 2.8 4 2.9 Major 2.9 Projects TOTAL 2.5 (2) 2 2.9 MINING 3.7 1.5 1.2 4.0 2.7 2.2 Other Mining 1.2 1.2 1.0 1.1 0 2014 2015e 2016e 2017e (1)…
  21. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 21
    Committed to Balance Sheet Management Strong Track Record 3/31/2015 Balances Large Resource Base with Strong Cash ( in bns) Flows and Capital Discipline Have Taken Steps to Reduce Cost & CAPEX, Complete Asset Sales and Reduce…
  22. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 22
    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 Growing Cash Flow & Production Profile…
  23. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 23
    Reference Slides
  24. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 24
    Sensitivities (US millions) 2016e/2017e Operating Change EBITDA Cash Flow Copper: +/- 0.10/lb 500 350 Molybdenum: +/- 1.00/lb 100 80 Gold: +/- 50/ounce 100 60 Oil Sales: +/- 5/bbl(1) 215 170 Oil Sales Net of Diesel…
  25. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 25
    PT-FI Mine Plan PT-FIs Share of Metal Sales, 2015e-2022e 2015e 2019e PT-FI Share Total: 5.65 billion lbs copper Copper, billion lbs Annual Average: 1.13 billion lbs Gold, million ozs 2015e 2019e PT-FI Share Total: 7.7 million ozs…
  26. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 26
    PT Freeport Indonesia Grasberg Minerals District Life-of-Mine Production Sequencing* Plan View Grasberg Open Pit 179mm mt (includes stockpiled ore) 0.96% Cu & 1.06 g/t Au 146mm mt Grasberg & DOZ 0.54% Cu & 0.69 g/t Au Kucing…
  27. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 27
    Brownfield Development Studies El Abra Bagdad Large sulfide resource 0.4% Cu Large sulfide resource 0.3% Cu supports 260 mt/d mill Resource supports potential to Potential incremental production more than double mill capacity* 750…
  28. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 28
    Deepwater GOM Progress Report Green Canyon Area 2nd Subsea Delineation Well Logged 482 of Net Oil Pay Established Sand Continuity Across Reservoir Holstein Deep 280 MMBOE Gross Resource Potential (was 75 MMBOE Initial Discovery)…
  29. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 29
    2015e Oil & Gas Operating Estimates Madden & Operating Cost: 2.10/Mcfe California Haynesville Pricing: NYMEX Operating Cost: 32/bbl Gulf of Mexico Operating Cost: 15/bbl Pricing: HLS/NYMEX 2015e Oil & Gas Sales by Region…
  30. Deutsche Bank Global Industrials Basic Materials Conference – Freeport-Mcmoran Inc. – slide 30
    2Q 4Q 2015 Oil Puts Indexed to Brent Unhedged 14% Hedged 86% 84 MBbls/d 90 Floor 70 Limit 31

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