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21st Annual BMO Capital Market – Freeport-Mcmoran Inc.

Freeport-Mcmoran Inc. · Feb 26, 2012 · 25 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. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 1
    Connecting the World Kathleen L. Quirk Executive Vice President & CFO www.fcx.com February 27, 2012
  2. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 2
    Investment Highlights Global Leader in Production of Copper, Gold and Molybdenum Well Situated to Meet Growing Demand for Metals Geographically Diverse Long-Lived Reserves Growing Production Profile Strong Financial Position…
  3. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 3
    FCXs Global Footprint Major Mine Operations & Development Projects All major assets majority-controlled and operated North America1 Copper Reserves Copper/Gold/Silver Cu 40.6 billion lbs Mo 2.71 billion lbs Molybdenum Sales…
  4. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 4
    Worlds Leading Copper Producers Top 10 Copper Producers (2011e) (000 t) 2,000 1,800 1,600 1,400 1,200 1,000 800 600 400 200 0 Codelco FCX BHP Billiton Xstrata Anglo Southern Rio Tinto KGHM Antofagasta RAO…
  5. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 5
    World Class Copper Discoveries Are Extremely Rare Recoverable Copper Reserves 2011e Copper Production Million metric tons Thousand metric tons 0 5 10 15 20 25 30 0 200 400 600 800 1000 Grasberg Complex - 1988 Escondida - 1979…
  6. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 6
    Markets 2,500 500 2,000 400 000s Metric Tons Cents Per Pound 1,500 300 LME Copper Price 1,000 200 500 100 LME & COMEX Exchange Stocks* 0 0 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08…
  7. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 7
    Value Creation Focus INVESTMENT CASH MINERAL RESERVE IN ATTRACTIVE PRODUCTION FLOWS/ RESOURCES ADDITIONS DEVELOPMENT GROWTH RETURNS PROJECTS FCX Copper Resources at 12/31/2011 Recoverable Reserves (a) 120 bn lbs Mineralized…
  8. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 8
    Preliminary Reserves at 12/31/11 Consolidated Proven & Probable Reserves Copper Molybdenum Gold billion lbs billion lbs million ozs 12/31/11 Reserves 12/31/10 (1) 120.5 3.39 35.5 Copper Reserves Additions/revisions* (2) 2.9…
  9. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 9
    Copper Reserves & Mineralized Material as of 12/31/11 billion lbs of copper 12/31/11 235 Mineralized Material (b) by Geographical Region Mineralized 115 Material (b) billion (contained copper) lbs North 120 at 2.20 Cu price…
  10. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 10
    Development Projects Update N. N. American American Copper Restarts (1) Copper Restarts (1) Climax Climax Molybdenum Mine (2) Molybdenum Mine (2) El El Abra Sulfolix (3) Abra Sulfolix (3) Grasberg Underground (4) Grasberg…
  11. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 11
    Advanced Stage Copper Projects Incremental Preliminary Copper Capital* Achieve Mill Expansions (mm lbs/year) ( billions) Full Rates Status EIS filed Cerro Verde (360K) 600 4.0 2016 4Q11 Completing Morenci (115K) 225 1.2 2014…
  12. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 12
    Potential Additional Projects North America South America Sulfides/Mill Projects El Abra Mill Large Scale Morenci Sierrita Africa Bagdad Ajo Future Expansion Twin Buttes of Tenke Oxides Safford/Lone Star Tenke Sulfides 13
  13. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 13
    2011 Highlights Excellent Financial Performance - Exceeded 2010 Records Solid Operating Performance Impacted by Labor Disruptions New Labor Agreements at Grasberg, Cerro Verde & El Abra Advanced Growth Projects to Increase…
  14. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 14
    2012e Outlook Sales Outlook: Copper: 3.8 Billion lbs. Gold: 1.2 Million ozs. Molybdenum: 80 Million lbs. Unit Net Cash Cost(1): 1.38/lb in 2012e Reflects Impact of Lower Volumes at Grasberg Future Costs Expected to Decline with…
  15. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 15
    Near-Term Sales Profile Copper Sales (billion lbs) Gold Sales (million ozs) 5.0+ 2 1.6 1.7 5 1.4 1.2 4.3 4.3 1 4 3.7 3.8 0 2011 2012e 2013e 2014e 3 ____________________ Note: Consolidated gold sales include approximately…
  16. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 16
    Grasberg Labor Situation Reached Financial Terms on New Collective Labor Agreement in December 2011 CLA Signed in January 2012 PTFI Implemented Terms of New CLA Employees Returned to Work in January Recent Work Interruptions…
  17. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 17
    2012e Operating Estimates 2012e Unit Production Costs North South (per pound of copper) America America Indonesia Africa Consolidated Cash Unit Costs (1) Site Production & Delivery (2) 1.89 1.55 2.59 1.51 1.92 By-product Credits…
  18. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 18
    Reconciliation of Unit Cash Costs Consolidated per lb of copper 2011 101 Grasberg (a) 20 North America (b) 10 South America (c) 7 Total 37 2012e 138 Impact of Higher 2013e/2014e Grasberg Volumes (20) With Higher Grasberg…
  19. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 19
    Adjusted EBITDA and Cash Flow at Various Copper Prices Average Adjusted EBITDA* (1,200 Gold & 12 Molybdenum) 12 (US billions) 9 6 3 0 Cu 3.00/lb Cu 3.50/lb Cu 4.00/lb Average Operating Cash Flow (excluding Working Capital…
  20. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 20
    Sensitivities Adjusted Operating Change EBITDA Cash Flow (US millions) Copper: -/+ 0.10/lb 400 275 Molybdenum: -/+ 1.00/lb 80 65 Gold: -/+ 50/ounce 80 50 Diesel(1): -/+ 10% 100 70 Purchased Power(2): -/+ 10% 50 40…
  21. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 21
    Capital Expenditures (1) Major Projects All Other (US billions) 5 4.0 4 3.5 3 1.6 2.5 1.3 2 1.1 (3) 1 2.4 2.2 (4) (2) 1.4 0 2011 2012e 2013e (1) Capital expenditure estimates will continue to be reviewed and…
  22. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 22
    Balance Sheet (US billions) Repaid 3.8 bn in Debt Since 20 YE 2008 (50% Reduction) (1) 17.6 Significant Liquidity Strong Credit Metrics 15 No Near-term Maturities Investment Grade Rated by Total Debt S&P, Moodys, Fitch…
  23. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 23
    Debt Refinancing Refinancing 3.0 Billion Existing 8.375% Notes Callable in April Issued 3 Billion of New Notes with Weighted Average Interest Cost of 3% on February 13, 2012 0.5 Billion of 1.4% Senior Notes Due February 2015 0.5…
  24. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 24
    Financial Policy Maintain Strong Balance Sheet & Liquidity Position Invest in Attractive Growth Projects Opportunistic Debt Repayment Board Action to Increase Common Stock Dividend Rate: 1.25/Share per Annum Board to…
  25. 21st Annual BMO Capital Market – Freeport-Mcmoran Inc. – slide 25
    FCX Investment Summary Worlds Premier Publicly Traded Copper Company Worlds Largest Molybdenum Producer & Significant Gold Producer Long-lived Reserves, Geographically Diverse Operations Flexible Operating Structure Can…

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