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7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc.

Freeport-Mcmoran Inc. · Jun 8, 2016 · 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. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 1
    7th Annual Global Industrials & Materials Summit Kathleen L. Quirk Executive Vice President & CFO June 8, 2016
  2. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 2
    Proving Our Mettle mettle /medl/ n: 1. a persons ability to cope well with difficulties or to face a demanding situation in a spirited and resilient way. 2015 Annual Report Highlights Executing Clearly Defined Strategy Maintaining…
  3. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 3
    Premier Portfolio of Long-Lived, Geographically Diverse Global Mining Assets Largest Copper Mine Worlds Largest One of Largest Copper/ High Grade Copper/ in North America Concentrating Facility Gold Reserves in World Cobalt Resource…
  4. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 4
    Long-term Structural Deficit in Copper Generally Expected Supply Demand Shortfall Declines Reasonable 7 Mt in Base Production + Long-term Demand Estimates = SUPPLY GAP by 2025 (with No New Projects) 18% Decline Over 1.7%…
  5. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 5
    Executing in a Weak Commodity Market Supported by Portfolio of High Quality Assets Adjusted Mine Plans Curtailed High Cost Production CAPEX Completion Reductions & of Major Cost Management Execution of Clearly Projects Defined…
  6. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 6
    Sale of 56% Interest in Tenke Announced Definitive Agreement on May 9, 2016 China Molybdenum Co. Ltd. (CMOC) to Acquire 70% of TF Holdings Limited 2.65 Billion Cash to FCX Plus Contingent Consideration of Up to 120 mm*…
  7. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 7
    Asset Sale Transactions To Date in 2016 2015 Date of EBITDA Expected Agreement Consideration 2.43 Cu Closing ( in billions) ( in millions) (1) Morenci (13% Interest) 2/15/16 1.0 115 Closed (2) Timok Exploration Project 3/3/16…
  8. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 8
    Cerro Verde Project Execution Completed Construction of Worlds Largest Concentrating Facility Strong Performance on Capital Cost Management and Startup Achieved Full Capacity Operating Rates During 1Q16 Cerro Verde Mill Rate…
  9. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 9
    Significant Copper Resources & Potential billion lbs of copper Future Resource Development Opportunities Indonesia Africa ** America 99 America Reserves* South North El Abra Major Sulfide Deposit North America…
  10. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 10
    Positive Free Cash Flow in Mining Business with Significant Leverage to Recovery ( in billions) 2016e 2015 1Q16 2016e EBITDA CAPEX 6.8 5.7 4.6 3.3 3.3 Major Avg. Cu: Projects 1.8 2.42 2.4 0.8 1.4 Avg. Cu: 0.5 Other 0.9…
  11. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 11
    Oil & Gas Highlights Focused on Managing Costs and Enhancing Asset Values New Organization Structure 1Q16* 1Q15 - Reduce Costs LOE (/bbl) 15.85 20.26 - Align Capital Allocation with Corporate Objectives CAPEX (mms) 523 1,033…
  12. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 12
    Deepwater Gulf of Mexico Focus Areas 1Q 2016 Net Production Rates Louisiana Asset Area MBOE/d Holstein Facility 9 Marlin Facility 30 Horn Mountain Facility Lucius 8 18 Dorado Marlin Other 3 Viosca Knoll Deepwater GOM…
  13. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 13
    2017e Oil & Gas EBITDA at Various Prices and CAPEX ( in billions) 1.8 1.4 1.0 0.6 0.5 35 Brent 45 Brent 55 Brent 65 Brent 2017e CAPEX NOTE: EBITDA equals operating income plus depreciation, depletion and amortization.…
  14. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 14
    Sales Profile CopperCopper Sales (billion Sales lbs) (billion lbs) Gold Sales (million ozs) 6 3 2 2.5 1.85 1 1.25 5.0 0 4.6 2015 2016e 2017e 4 4.1 Note: Consolidated gold sales include 115k ozs in 2015, 170k ozs in 2016e and…
  15. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 15
    EBITDA and Cash Flow at Various Copper Prices Average EBITDA (1,200 Gold, 6 Molybdenum & 47 Oil)* 9 (US billions) 6 3 2016e/2017e Average 0 Cu 2.00/lb Cu 2.25/lb Cu 2.50/lb Average Operating Cash Flow (excluding Working…
  16. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 16
    Capital Expenditures (US billions) 6.35 Future Spending Dependent on Improvement in Market Conditions Oil & Gas 3.0 3.3 Major Mining 1.5 (1) 2.2 Projects TOTAL MINING 0.5 (1) 2.4 3.3 1.4 0.8 Other 1.8 1.7 Mining…
  17. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 17
    Committed to Balance Sheet Management Strong Track Record (US billions) Manageable Near-Term Debt Maturity Schedule Pro Forma for Morenci, Timok & Tenke Transactions PF FCX Debt Structure as of 3/31/16 3 (US billions) 2.2 Bn of…
  18. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 18
    Focused on Execution Cost, Capital & Production Performance Safety & Securing Long- Environmental term Rights in Management Indonesia Asset Sales Debt Reduction Strong Track Record 19
  19. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 19
    Reference Slides 20
  20. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 20
    Financial Highlights Sales Data 1Q16 1Q15 Copper Consolidated Volumes (mm lbs) 1,123 960 Average Realization (per lb) 2.17 2.72 Site Production & Delivery Costs (per lb) 1.51 1.93 Unit Net Cash Costs (per lb) 1.38 1.64 Gold…
  21. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 21
    Sale of Interest in Timok Copper-Gold Project Located in Serbia Consideration to FCX Includes: - 135 mm Payable at Closing - Up to 20 mm to be Spent by Purchaser in Connection with Agreed Exploration and Study Work on the Lower Zone…
  22. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 22
    Termination & Settlement of Deepwater Rig Contracts Rowan Settlement Noble Settlement FCX Will Pay Rowan 215 mm FCX to Provide Noble with in Cash 540 mm in Cash, FCX Stock or Noble Bonds (at FCX FCX Agreed to Contingent option)…
  23. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 23
    2016e Operating Estimates 2016e Unit Production Costs (per pound of copper) North South America America Indonesia Africa (4) Consolidated Cash Unit Costs (1) Site Production & Delivery (2) 1.41 1.26 1.21 1.62 1.33 By-product Credits…
  24. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 24
    2016e Quarterly Sales Copper Sales* (million lbs) Gold Sales (thousand ozs) 1000 1,500 950 750 1,405 500 505 1,335 250 201 195 0 1,123 1,150 1Q16 2Q16e 3Q16e 4Q16e 1,000 Note: Consolidated gold sales include approximately 18k…
  25. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 25
    PT-FI Mine Plan PT-FIs Share of Metal Sales, 2016e-2022e 2016e 2020e PT-FI Share Total: 5.9 billion lbs copper Copper, billion lbs Annual Average: 1.18 billion lbs Gold, million ozs 2016e 2020e PT-FI Share Total: 7.85 million ozs…
  26. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 26
    Sensitivities (US millions) 2016e Operating Change EBITDA Cash Flow Copper: +/- 0.10/lb 425 340 Molybdenum: +/- 1.00/lb 28 22 Gold: +/- 50/ounce 75 45 Oil Sales: +/- 5/bbl(1) 150 120 Oil Sales Net of Diesel Costs:(1,2) +/-…
  27. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 27
    Sensitivities (US millions) 2017e Operating Change EBITDA Cash Flow Copper: +/- 0.10/lb 435 350 Molybdenum: +/- 1.00/lb 35 28 Gold: +/- 50/ounce 125 75 Oil Sales: +/- 5/bbl(1) 200 160 Oil Sales Net of Diesel Costs:(1,2) +/-…
  28. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 28
    2016e Oil & Gas Operating Estimates Madden & Operating Cost: 1.90/Mcfe California Haynesville Pricing: NYMEX Operating Cost: 29/bbl Gulf of Mexico Operating Cost: 11/bbl Pricing: HLS/NYMEX 2016e Oil & Gas Sales by Region…
  29. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 29
    Adjusted EBITDA Reconciliation (in millions) 12 Months 1Q 2016 Ended 3/31/2016 Net loss attributable to common stock (4,184) (13,946) Interest expense, net 200 699 Income tax provision (benefit) 70 (1,170) Depreciation, depletion and…
  30. 7th Annual Global Industrials and Materials Summit – Freeport-Mcmoran Inc. – slide 30
    FCX Debt Maturities as of 3/31/16 Pro Forma for Morenci, Timok & Tenke Transactions 10 (US billions) PF Total Debt & Cash at 3/31/16 (US billions) FCX Revolver & Term Loan 1.6 8 FCX & FMC Sr. Notes 12.3 FM O&G Senior Notes 2.5…

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