PHOENIX--(BUSINESS WIRE)--
Freeport-McMoRan Inc. (NYSE: FCX):
-
Net loss attributable to common stock totaled $1.85 billion,
$1.78 per share, for second-quarter 2015. After adjusting for net
charges totaling $2.0 billion, $1.92 per share, second-quarter 2015
adjusted net income attributable to common stock totaled $143 million,
$0.14 per share.
-
Consolidated sales totaled 964 million pounds of copper, 352
thousand ounces of gold, 23 million pounds of molybdenum and 13.1
million barrels of oil equivalents (MMBOE) for second-quarter 2015,
compared with 968 million pounds of copper, 159 thousand ounces of
gold, 25 million pounds of molybdenum and 16.0 MMBOE for
second-quarter 2014.
-
Consolidated sales for the year 2015 are expected to
approximate 4.2 billion pounds of copper, 1.3 million ounces of gold,
93 million pounds of molybdenum and 52.3 MMBOE, including 1.0 billion
pounds of copper, 315 thousand ounces of gold, 24 million pounds of
molybdenum and 13.6 MMBOE for third-quarter 2015.
-
Average realized prices were $2.71 per pound for copper, $1,174
per ounce for gold and $67.61 per barrel for oil (including $11.79 per
barrel for cash gains on derivative contracts) for second-quarter 2015.
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Consolidated unit net cash costs for second-quarter 2015
averaged $1.50 per pound of copper for mining operations and $19.04
per barrel of oil equivalents (BOE) for oil and gas operations.
-
Operating cash flows totaled $1.1 billion (net of $104
million in working capital uses and changes in other tax payments) for
second-quarter 2015. Based on current sales volume and cost estimates
and assuming average prices of $2.50 per pound for copper, $1,150 per
ounce for gold, $6 per pound for molybdenum and $56 per barrel for
Brent crude oil for the second half of 2015, operating cash flows for
the year 2015 are expected to approximate $3.6 billion.
-
Capital expenditures totaled $1.7 billion for second-quarter
2015, including $0.6 billion for major projects at mining operations
and $0.8 billion for oil and gas operations. Capital expenditures are
expected to approximate $6.3 billion for the year 2015, including $2.5
billion for major projects at mining operations and $2.8 billion for
oil and gas operations.
-
FCX has made substantial progress toward the completion of its
major mining development projects, which are expected to result in
increased near-term production, lower unit costs, declining capital
expenditures and growth in free cash flow over the next several
quarters. In addition, positive oil and gas drilling and
development activities are expected to result in a growing oil
production profile. FCX remains focused on maintaining a strong
balance sheet and on continuing to manage costs, capital spending
plans and other actions as required to maintain financial strength.
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On June 23, 2015, Freeport-McMoRan Oil & Gas Inc. filed a
registration statement related to its potential initial public
offering (IPO) of Class A common stock representing a minority
interest in the entity.
-
At June 30, 2015, consolidated debt totaled $20.9 billion
and consolidated cash totaled $466 million.
Freeport-McMoRan Inc. (NYSE: FCX) reported a net loss attributable to
common stock of $1.85 billion, $1.78 per share, for second-quarter 2015
and $4.3 billion, $4.16 per share, for the first six months of 2015,
compared with net income attributable to common stock of $482 million,
$0.46 per share, for second-quarter 2014 and $992 million, $0.95 per
share, for the first six months of 2014. FCX’s net loss attributable to
common stock included net charges totaling $2.0 billion, $1.92 per
share, for second-quarter 2015 and $4.4 billion, $4.24 per share, for
the first six months of 2015, primarily for the reduction of the
carrying value of oil and gas properties and other items described
below. Net income attributable to common stock included charges for
special items totaling $160 million, $0.15 per share, for second-quarter
2014 and $179 million, $0.17 per share, for the first six months of
2014, comprised of items described below.
James R. Moffett, Chairman of the Board; Richard C. Adkerson, Vice
Chairman and FCX Chief Executive Officer; and James C. Flores, Vice
Chairman and FM O&G Chief Executive Officer, said, "Our second-quarter
results reflect strong operating performance in our global mining
business, and solid production results and continued positive drilling
and development results in our oil and gas operations. We are pleased to
report achievement of several important milestones as we complete our
major development projects and position FCX for improving free cash flow
generation. We remain focused on managing our costs and capital
expenditures under volatile market conditions as we seek to strengthen
our balance sheet and build values from our strong portfolio of
resources."
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SUMMARY FINANCIAL DATA
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Three Months Ended
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Six Months Ended
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June 30,
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June 30,
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2015
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2014
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2015
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2014
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(in millions, except per share amounts)
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Revenuesa,b,c
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$
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4,248
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|
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$
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5,522
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|
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$
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8,401
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|
|
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$
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10,507
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|
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Operating (loss) incomea
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$
|
(2,374
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)
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|
d,e,f
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|
$
|
1,153
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|
g,h
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|
$
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(5,337
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)
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d,e,f,i
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$
|
2,264
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g,h
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Net (loss) income attributable to common stockb,c,j
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$
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(1,851
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)
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d,e,f,k,l
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$
|
482
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|
g,h,m
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|
$
|
(4,325
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)
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d,e,f,i,k,l
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|
$
|
992
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|
g,h,m
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Diluted net (loss) income per share of common stockb,c
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|
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$
|
(1.78
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)
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|
d,e,f,k,l
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$
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0.46
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|
g,h,m
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|
$
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(4.16
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)
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d,e,f,i,k,l
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|
$
|
0.95
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|
g,h,m
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Diluted weighted-average common shares outstanding
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1,040
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|
|
|
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1,045
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|
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1,040
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|
|
|
1,045
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Operating cash flowsn
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$
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1,069
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|
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$
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1,386
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$
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1,786
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|
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$
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2,587
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Capital expenditures
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$
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1,661
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$
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1,950
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$
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3,528
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|
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$
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3,562
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At June 30:
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Cash and cash equivalents
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$
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466
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$
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1,458
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$
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466
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$
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1,458
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Total debt, including current portion
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$
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20,902
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|
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$
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20,190
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$
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20,902
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$
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20,190
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a. For segment financial results, refer to the supplemental
schedule, "Business Segments," beginning on page XI, which is available
on FCX's website, "fcx.com."
b. Includes (unfavorable) favorable adjustments to
provisionally priced concentrate and cathode copper sales recognized in
prior periods totaling $(20) million ($(10) million to net loss
attributable to common stock or $(0.01) per share) for second-quarter
2015, $35 million ($16 million to net income attributable to common
stock or $0.01 per share) for second-quarter 2014, $(106) million ($(50)
million to net loss attributable to common stock or $(0.05) per share)
for the first six months of 2015 and $(118) million ($(65) million to
net income attributable to common stock or $(0.06) per share) for the
first six months of 2014. For further discussion, refer to the
supplemental schedule, "Derivative Instruments," beginning on page X,
which is available on FCX's website, "fcx.com."
c. Includes net noncash mark-to-market (losses) gains
associated with crude oil and natural gas derivative contracts totaling
$(95) million ($(59) million to net loss attributable to common stock or
$(0.06) per share) for second-quarter 2015, $(7) million ($(4) million
to net income attributable to common stock or less than $(0.01) per
share) for second-quarter 2014, $(143) million ($(89) million to net
loss attributable to common stock or $(0.09) per share) for the first
six months of 2015 and $8 million ($5 million to net income attributable
to common stock or less than $0.01 per share) for the first six months
of 2014. For further discussion, refer to the supplemental schedule,
"Derivative Instruments," beginning on page X, which is available on
FCX's website, "fcx.com."
d. Includes charges of $2.7 billion ($1.7 billion to net loss
attributable to common stock or $1.61 per share) for second-quarter 2015
and $5.8 billion ($3.6 billion to net loss attributable to common stock
or $3.47 per share) for the first six months of 2015 to reduce the
carrying value of oil and gas properties pursuant to full cost
accounting rules. Refer to page 11 for further discussion.
e. Includes charges totaling $59 million ($38 million to net
loss attributable to common stock or $0.04 per share) for second-quarter
2015 and $63 million ($41 million to net loss attributable to common
stock or $0.04 per share) for the first six months of 2015 for lower of
cost or market (LCM) adjustments primarily attributable to molybdenum
inventories.
f. Includes net charges of $22 million ($14 million to net
loss attributable to common stock or $0.01 per share) for second-quarter
2015 and $39 million ($24 million to net loss attributable to common
stock or $0.02 per share) for the first six months of 2015 for
idle/terminated rig costs and inventory write-downs at oil and gas
operations.
g. Includes net charges for adjustments to environmental
obligations and related litigation reserves of $69 million ($68 million
to net income attributable to common stock or $0.06 per share) for the
second quarter and first six months of 2014.
h. Includes charges of $56 million ($30 million to net income
attributable to common stock or $0.03 per share) for second-quarter 2014
and $109 million ($58 million to net income attributable to common stock
or $0.06 per share) for the first six months of 2014 for fixed costs
charged directly to cost of sales as a result of the impact of export
restrictions on PT Freeport Indonesia's (PT-FI) operating rates.
i. The first six months of 2015 includes a net gain of $39
million ($25 million to net loss attributable to common stock or $0.02
per share) associated with the sale of FCX's one-third interest in the
Luna Energy power facility in New Mexico.
j. FCX defers recognizing profits on intercompany sales until
final sales to third parties occur. For a summary of net impacts from
changes in these deferrals, refer to the supplemental schedule,
"Deferred Profits," on page XI, which is available on FCX's website,
"fcx.com."
k. The second quarter and first six months of 2015 include a
gain of $92 million ($0.09 per share) related to net proceeds received
from insurance carriers and other third parties related to a shareholder
derivative litigation settlement.
l. As a result of the impairment to oil and gas properties,
FCX recorded tax charges of $305 million ($0.29 per share) for
second-quarter 2015 and $763 million ($0.73 per share) for the first six
months of 2015 to establish a valuation allowance primarily against
United States (U.S.) federal alternative minimum tax credits.
m. The second quarter and first six months of 2014 included a
tax charge of $58 million ($0.06 per share) associated with deferred
taxes recorded in connection with the allocation of goodwill to the sale
of Eagle Ford.
n. Includes net working capital uses and changes in other tax
payments of $104 million for second-quarter 2015, $364 million for
second-quarter 2014, $190 million for the first six months of 2015, and
$777 million for the first six months of 2014.
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SUMMARY OPERATING DATA
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Three Months Ended
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Six Months Ended
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June 30,
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June 30,
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2015
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2014a
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2015
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2014a
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Copper (millions of recoverable pounds)
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|
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Production
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|
|
977
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|
|
|
931
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|
|
|
1,892
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|
|
|
1,879
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|
Sales, excluding purchases
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|
|
|
964
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|
|
|
968
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|
|
|
1,924
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|
|
|
1,839
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|
Average realized price per pound
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|
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$
|
2.71
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|
|
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$
|
3.16
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|
|
|
$
|
2.70
|
|
|
|
$
|
3.17
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|
Site production and delivery costs per poundb
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|
|
|
$
|
1.85
|
|
|
|
$
|
1.99
|
|
|
|
$
|
1.89
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|
|
|
$
|
1.94
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|
Unit net cash costs per poundb
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|
|
|
$
|
1.50
|
|
|
|
$
|
1.72
|
|
|
|
$
|
1.57
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|
|
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$
|
1.64
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|
Gold (thousands of recoverable ounces)
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|
|
|
|
|
|
|
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|
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|
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Production
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|
|
367
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|
|
|
166
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|
|
|
626
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|
|
|
397
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|
Sales, excluding purchases
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|
|
|
352
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|
|
|
159
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|
|
|
615
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|
|
|
346
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Average realized price per ounce
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|
|
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$
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1,174
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|
|
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$
|
1,296
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|
|
|
$
|
1,183
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|
|
|
$
|
1,299
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|
Molybdenum (millions of recoverable pounds)
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|
|
|
|
|
|
|
|
|
|
|
|
|
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Production
|
|
|
|
25
|
|
|
|
25
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|
|
|
49
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|
|
|
49
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|
Sales, excluding purchases
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|
|
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23
|
|
|
|
25
|
|
|
|
46
|
|
|
|
52
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Average realized price per pound
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|
|
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$
|
9.51
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|
|
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$
|
13.43
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|
|
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$
|
9.84
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|
|
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$
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12.27
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Oil Equivalents
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|
|
|
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Sales volumes
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|
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|
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|
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|
MMBOE
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|
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13.1
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|
|
|
16.0
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25.6
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|
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32.2
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Thousand BOE (MBOE) per day
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|
|
|
144
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|
|
|
176
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|
|
142
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|
|
|
178
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Cash operating margin per BOEc
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|
|
|
|
|
|
|
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|
|
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Realized revenues
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$
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50.04
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|
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$
|
77.53
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|
|
|
$
|
46.95
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|
|
|
$
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77.37
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|
Cash production costs
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|
|
|
19.04
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|
|
|
19.57
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|
|
|
19.62
|
|
|
|
19.03
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Cash operating margin
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|
|
|
$
|
31.00
|
|
|
|
$
|
57.96
|
|
|
|
$
|
27.33
|
|
|
|
$
|
58.34
|
|
|
|
|
|
|
|
|
|
|
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a. The 2014 periods include the results of the Candelaria and
Ojos del Salado mines (Candelaria/Ojos) that were sold in November 2014,
and the Eagle Ford properties that were sold in June 2014. Sales volumes
from Candelaria/Ojos totaled 80 million pounds of copper and 20 thousand
ounces of gold for second-quarter 2014 and 174 million pounds of copper
and 43 thousand ounces of gold for the first six months of 2014; sales
volumes from Eagle Ford totaled 4.0 MMBOE (44 MBOE per day) for
second-quarter 2014 and 8.7 MMBOE (48 MBOE per day) for the first six
months of 2014.
b. Reflects per pound weighted-average production and delivery
costs and unit net cash costs (net of by-product credits) for all copper
mines. For reconciliations of per pound unit costs by operating division
to production and delivery costs applicable to sales reported in FCX's
consolidated financial statements, refer to the supplemental schedules,
"Product Revenues and Production Costs," beginning on page XIV, which is
available on FCX's website, "fcx.com."
c. Cash operating margin for oil and gas operations reflects
realized revenues less cash production costs. Realized revenues exclude
noncash mark-to-market adjustments on derivative contracts. For
reconciliations of realized revenues and cash production costs per BOE
to revenues and production and delivery costs reported in FCX's
consolidated financial statements, refer to the supplemental schedules,
“Product Revenues and Production Costs,” beginning on page XIV, which is
available on FCX's website, “fcx.com.”
Consolidated Sales Volumes
Second-quarter 2015 consolidated copper sales of 964 million
pounds approximated the April 2015 estimate of 960 million pounds and
second-quarter 2014 sales of 968 million pounds. Second-quarter 2015
reflects higher copper sales volumes from North America and Indonesia,
offset by lower sales volumes from South America, resulting from the
sale of Candelaria/Ojos in fourth-quarter 2014 and lower production from
Cerro Verde and El Abra.
Second-quarter 2015 consolidated gold sales of 352 thousand
ounces were higher than the April 2015 estimate of 300 thousand ounces
and second-quarter 2014 sales of 159 thousand ounces, primarily
reflecting higher ore grades and operating rates at PT-FI.
Second-quarter 2015 consolidated molybdenum sales of 23 million
pounds were slightly lower than the April 2015 estimate and
second-quarter 2014 sales of 25 million pounds, reflecting slowing
demand in the metallurgic market for molybdenum.
Second-quarter 2015 sales from oil and gas operations of 13.1 MMBOE,
including 8.6 million barrels (MMBbls) of crude oil, 23.5 billion
cubic feet (Bcf) of natural gas and 0.6 MMBbls of natural gas
liquids (NGLs), were higher than the April 2015 estimate of 12.9
MMBOE, but were lower than second-quarter 2014 sales of 16.0 MMBOE,
primarily reflecting the sale of the Eagle Ford properties in June 2014.
Consolidated sales for the year 2015 are expected to approximate 4.2
billion pounds of copper, 1.3 million ounces of gold, 93 million pounds
of molybdenum and 52.3 MMBOE, including 1.0 billion pounds of copper,
315 thousand ounces of gold, 24 million pounds of molybdenum and 13.6
MMBOE for third-quarter 2015.
Consolidated Unit Costs
Mining Unit Net Cash Costs. Consolidated average unit net cash
costs (net of by-product credits) for FCX's copper mines of $1.50 per
pound of copper in second-quarter 2015 were lower than unit net cash
costs of $1.72 per pound in second-quarter 2014, primarily reflecting
lower site production and delivery costs as a result of higher sales
volumes in Indonesia and North America, and higher by-product credits.
Assuming average prices of $1,150 per ounce of gold and $6 per pound of
molybdenum for the second half of 2015 and achievement of current sales
volume and cost estimates, consolidated unit net cash costs (net of
by-product credits) for copper mines are expected to average $1.53 per
pound of copper for the year 2015. Quarterly unit net cash costs vary
with fluctuations in sales volumes and average realized prices
(primarily gold and molybdenum prices). The impact of price changes for
the second half of 2015 on consolidated unit net cash costs would
approximate $0.01 per pound for each $50 per ounce change in the average
price of gold and $0.01 per pound for each $2 per pound change in the
average price of molybdenum.
Oil and Gas Cash Production Costs per BOE. Cash production costs
for oil and gas operations of $19.04 per BOE in second-quarter 2015 were
lower than cash production costs of $19.57 per BOE in second-quarter
2014, primarily reflecting lower cash production costs in California
related to reductions in repair and maintenance costs and well workover
expense.
Based on current sales volume and cost estimates for the second half of
2015, cash production costs are expected to approximate $19 per BOE for
the year 2015.
MINING OPERATIONS
North America Copper Mines. FCX operates seven open-pit copper
mines in North America - Morenci, Bagdad, Safford, Sierrita and Miami in
Arizona, and Chino and Tyrone in New Mexico. All of the North America
mining operations are wholly owned, except for Morenci. FCX records its
85 percent joint venture interest in Morenci using the proportionate
consolidation method. In addition to copper, molybdenum concentrate and
silver are also produced by certain of FCX's North America copper mines.
Operating and Development Activities. FCX has increased
production from its North America copper mines in recent years and
continues to evaluate a number of opportunities to add production
capacity following positive exploration results. Future investments will
be undertaken based on the results of economic and technical feasibility
studies and market conditions.
The Morenci mill expansion project commenced operations in May 2014 and
successfully achieved full rates in second-quarter 2015. The project
expanded mill capacity from 50,000 metric tons of ore per day to
approximately 115,000 metric tons of ore per day, which results in
incremental annual production of approximately 225 million pounds of
copper. Morenci's copper production is expected to average over 900
million pounds per year over the next five years. Additionally, the
molybdenum circuit began production in first-quarter 2015. Remaining
items associated with the project include construction of the expanded
tailings storage facility, which is expected to be completed in the
second half of 2015.
Operating Data. Following is summary consolidated operating data
for the North America copper mines for the second quarters and first six
months of 2015 and 2014:
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|
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|
|
|
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Three Months Ended
|
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|
Six Months Ended
|
|
|
|
|
|
June 30,
|
|
|
June 30,
|
|
|
|
|
|
2015
|
|
|
2014
|
|
|
2015
|
|
|
2014
|
|
Copper (millions of recoverable pounds)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
|
|
|
|
469
|
|
|
|
395
|
|
|
|
921
|
|
|
|
780
|
|
|
Sales
|
|
|
|
486
|
|
|
|
423
|
|
|
|
958
|
|
|
|
794
|
|
|
Average realized price per pound
|
|
|
|
$
|
2.77
|
|
|
|
$
|
3.16
|
|
|
|
$
|
2.73
|
|
|
|
$
|
3.21
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Molybdenum (millions of recoverable pounds)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Productiona
|
|
|
|
10
|
|
|
|
9
|
|
|
|
19
|
|
|
|
17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unit net cash costs per pound of copperb
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Site production and delivery, excluding adjustments
|
|
|
|
$
|
1.78
|
|
|
|
$
|
1.87
|
|
|
|
$
|
1.79
|
|
|
|
$
|
1.87
|
|
|
By-product credits
|
|
|
|
(0.16
|
)
|
|
|
(0.28
|
)
|
|
|
(0.17
|
)
|
|
|
(0.25
|
)
|
|
Treatment charges
|
|
|
|
0.12
|
|
|
|
0.11
|
|
|
|
0.13
|
|
|
|
0.12
|
|
|
Unit net cash costs
|
|
|
|
$
|
1.74
|
|
|
|
$
|
1.70
|
|
|
|
$
|
1.75
|
|
|
|
$
|
1.74
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
a. Refer to summary operating data on page 4 for FCX's
consolidated molybdenum sales, which includes sales of molybdenum
produced at the North America copper mines.
b. For a reconciliation of unit net cash costs per pound to
production and delivery costs applicable to sales reported in FCX's
consolidated financial statements, refer to the supplemental schedules,
"Product Revenues and Production Costs," beginning on page XIV, which is
available on FCX's website, "fcx.com."
North America's consolidated copper sales volumes of 486 million pounds
in second-quarter 2015 were higher than second-quarter 2014 sales of 423
million pounds, primarily reflecting higher milling rates at Morenci and
Chino. North America sales are estimated to approximate 1.96 billion
pounds for the year 2015, compared with 1.66 billion pounds of copper in
2014.
Average unit net cash costs (net of by-product credits) for the North
America copper mines of $1.74 per pound of copper in second-quarter 2015
were higher than unit net cash costs of $1.70 per pound in
second-quarter 2014, primarily reflecting lower by-product credits,
partly offset by higher copper sales volumes. Average unit net cash
costs (net of by-product credits) for the North America copper mines are
expected to approximate $1.72 per pound of copper for the year 2015,
based on current sales volume and cost estimates and assuming an average
molybdenum price of $6 per pound for the second half of 2015. North
America's average unit net cash costs would change by approximately
$0.02 per pound for each $2 per pound change in the average price of
molybdenum for the second half of 2015.
South America Mining. FCX operates two copper mines in South
America - Cerro Verde in Peru (in which FCX owns a 53.56 percent
interest) and El Abra in Chile (in which FCX owns a 51 percent
interest). These operations are consolidated in FCX's financial
statements. In addition to copper, the Cerro Verde mine produces
molybdenum concentrate and silver.
In November 2014, FCX completed the sale of its ownership interests in
Candelaria/Ojos in Chile.
Development Activities. Construction activities associated with a
large-scale expansion at Cerro Verde are advancing on schedule toward
completion in late 2015. Detailed engineering and major procurement
activities are complete and construction is more than 87 percent
complete. The project will expand the concentrator facilities from
120,000 metric tons of ore per day to 360,000 metric tons of ore per day
and provide incremental annual production of approximately 600 million
pounds of copper and 15 million pounds of molybdenum beginning in 2016.
As of June 30, 2015, $3.9 billion had been incurred for this project,
with approximately $0.7 billion remaining to be incurred.
FCX continues to evaluate a potential large-scale milling operation at
El Abra to process additional sulfide material and to achieve higher
recoveries. Exploration results in recent years at El Abra indicate a
significant sulfide resource, which could potentially support a major
mill project. Future investments will depend on technical studies,
economic factors and global copper market conditions.
Operating Data. Following is summary consolidated operating data
for the South America mining operations for the second quarters and
first six months of 2015 and 2014:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Six Months Ended
|
|
|
|
|
|
June 30,
|
|
|
June 30,
|
|
|
|
|
|
2015
|
|
|
2014a
|
|
|
2015
|
|
|
2014a
|
|
Copper (millions of recoverable pounds)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
|
|
|
|
188
|
|
|
|
300
|
|
|
|
381
|
|
|
|
614
|
|
|
Sales
|
|
|
|
178
|
|
|
|
310
|
|
|
|
378
|
|
|
|
617
|
|
|
Average realized price per pound
|
|
|
|
$
|
2.69
|
|
|
|
$
|
3.17
|
|
|
|
$
|
2.68
|
|
|
|
$
|
3.16
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gold (thousands of recoverable ounces)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
|
|
|
|
—
|
|
|
|
21
|
|
|
|
—
|
|
|
|
42
|
|
|
Sales
|
|
|
|
—
|
|
|
|
20
|
|
|
|
—
|
|
|
|
43
|
|
|
Average realized price per ounce
|
|
|
|
$
|
—
|
|
|
|
$
|
1,302
|
|
|
|
$
|
—
|
|
|
|
$
|
1,302
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Molybdenum (millions of recoverable pounds)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Productionb
|
|
|
|
2
|
|
|
|
2
|
|
|
|
4
|
|
|
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unit net cash costs per pound of copperc
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Site production and delivery, excluding adjustments
|
|
|
|
$
|
1.77
|
|
|
|
$
|
1.64
|
|
|
|
$
|
1.76
|
|
|
|
$
|
1.57
|
|
|
By-product credits
|
|
|
|
(0.04
|
)
|
|
|
(0.23
|
)
|
|
|
(0.06
|
)
|
|
|
(0.24
|
)
|
|
Treatment charges
|
|
|
|
0.17
|
|
|
|
0.18
|
|
|
|
0.17
|
|
|
|
0.18
|
|
|
Royalty on metals
|
|
|
|
—
|
|
|
|
0.01
|
|
|
|
—
|
|
|
|
—
|
|
|
Unit net cash costs
|
|
|
|
$
|
1.90
|
|
|
|
$
|
1.60
|
|
|
|
$
|
1.87
|
|
|
|
$
|
1.51
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
a. The 2014 periods include the results of Candelaria/Ojos
that were sold in November 2014. Candelaria/Ojos had sales volumes
totaling 80 million pounds of copper and 20 thousand ounces of gold for
second-quarter 2014 and 174 million pounds of copper and 43 thousand
ounces of gold for the first six months of 2014. Excluding
Candelaria/Ojos, South America mining's unit net cash costs averaged
$1.55 per pound of copper for second-quarter 2014 and $1.51 per pound of
copper for the first six months of 2014.
b. Refer to summary operating data on page 4 for FCX's
consolidated molybdenum sales, which includes sales of molybdenum
produced at Cerro Verde.
c. For a reconciliation of unit net cash costs per pound to
production and delivery costs applicable to sales reported in FCX's
consolidated financial statements, refer to the supplemental schedules,
"Product Revenues and Production Costs," beginning on page XIV, which is
available on FCX's website, "fcx.com."
South America's consolidated copper sales volumes of 178 million pounds
in second-quarter 2015 were lower than second-quarter 2014 sales of 310
million pounds, reflecting the sale of Candelaria/Ojos and lower
production from Cerro Verde and El Abra primarily associated with lower
ore grades and recovery rates. Sales from South America mining are
expected to approximate 900 million pounds of copper for the year 2015,
compared with 1.14 billion pounds of copper in 2014 (which included 268
million pounds from Candelaria/Ojos).
Average unit net cash costs (net of by-product credits) for South
America mining of $1.90 per pound of copper in second-quarter 2015 were
higher than unit net cash costs of $1.60 per pound in second-quarter
2014, primarily reflecting lower sales volumes and lower by-product
credits. Lower by-product credits were mostly because of the sale of
Candelaria/Ojos in fourth-quarter 2014. Average unit net cash costs (net
of by-product credits) for South America mining are expected to
approximate $1.75 per pound of copper for the year 2015, based on
current sales volume and cost estimates and assuming average prices of
$6 per pound of molybdenum for the second half of 2015.
Indonesia Mining. Through its 90.64 percent owned and
consolidated subsidiary PT-FI, FCX's assets include one of the world's
largest copper and gold deposits at the Grasberg minerals district in
Papua, Indonesia. PT-FI operates a proportionately consolidated joint
venture, which produces copper concentrates that contain significant
quantities of gold and silver.
Regulatory Matters. PT-FI is engaged in active discussions with
the Indonesian government regarding its Contract of Work (COW) and
long-term operating rights. Negotiations are taking into consideration
PT-FI's requirement for assurance of legal and fiscal terms post-2021
for PT-FI to continue with its large-scale investment program in Papua,
Indonesia.
PT-FI is advancing plans for the construction of new smelter capacity in
parallel with completing negotiations on its COW and long-term operating
rights. PT-FI has identified potential sites for the construction of
additional smelter capacity and is in discussions with potential
partners for the project.
Under the July 2014 Memorandum of Understanding (MOU) between PT-FI and
the Indonesia government, no terms of the COW other than those relating
to export duties, a smelter bond and increased royalties will be changed
until the completion of an amended COW.
PT-FI is required to apply for renewal of export permits at six-month
intervals and the next renewal date is July 25, 2015. PT-FI has
submitted the requirements for renewal of its license and government
approvals are pending.
Development Activities. PT-FI has several projects in progress in
the Grasberg minerals district related to the development of
large-scale, long-lived, high-grade underground ore bodies. In
aggregate, these underground ore bodies are expected to ramp up over
several years to process approximately 240,000 metric tons of ore per
day following the transition from the Grasberg open pit, currently
anticipated to occur in late 2017. Development of the Grasberg Block
Cave and Deep Mill Level Zone (DMLZ) underground mines is advancing to
enable DMLZ to commence production in late 2015 and the Grasberg Block
Cave mine to commence production in 2018. Over the next five years,
estimated aggregate capital spending on these projects is currently
expected to average $0.8 billion per year ($0.7 billion per year net to
PT-FI). Additionally, over the next five years, estimated aggregate
capital spending for processing and power facilities to optimize the
handling of underground ore is expected to average $0.3 billion per
year. Considering the long-term nature and size of these projects,
actual costs could vary from these estimates. PT-FI may reduce or defer
these activities pending resolution of negotiations for an amended COW.
Operating Data. Following is summary consolidated operating data
for the Indonesia mining operations for the second quarters and first
six months of 2015 and 2014:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
Six Months Ended
|
|
|
|
|
|
|
June 30,
|
|
|
|
June 30,
|
|
|
|
|
|
|
2015
|
|
|
|
2014
|
|
|
|
2015
|
|
|
|
2014
|
|
|
Copper (millions of recoverable pounds)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
|
|
|
|
205
|
|
|
|
|
122
|
|
|
|
|
359
|
|
|
|
|
262
|
|
|
|
Sales
|
|
|
|
196
|
|
|
|
|
117
|
|
|
|
|
351
|
|
|
|
|
226
|
|
|
|
Average realized price per pound
|
|
|
|
$
|
2.61
|
|
|
|
|
$
|
3.19
|
|
|
|
|
$
|
2.66
|
|
|
|
|
$
|
3.15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gold (thousands of recoverable ounces)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
|
|
|
|
360
|
|
|
|
|
142
|
|
|
|
|
615
|
|
|
|
|
350
|
|
|
|
Sales
|
|
|
|
346
|
|
|
|
|
135
|
|
|
|
|
606
|
|
|
|
|
297
|
|
|
|
Average realized price per ounce
|
|
|
|
$
|
1,173
|
|
|
|
|
$
|
1,294
|
|
|
|
|
$
|
1,183
|
|
|
|
|
$
|
1,299
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unit net cash costs per pound of coppera
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Site production and delivery, excluding adjustments
|
|
|
|
$
|
2.26
|
|
|
|
|
$
|
3.86
|
|
b
|
|
|
$
|
2.51
|
|
|
|
|
$
|
3.60
|
|
b
|
|
Gold and silver credits
|
|
|
|
(2.13
|
)
|
|
|
|
(1.57
|
)
|
|
|
|
(2.11
|
)
|
|
|
|
(1.85
|
)
|
|
|
Treatment charges
|
|
|
|
0.32
|
|
|
|
|
0.26
|
|
|
|
|
0.31
|
|
|
|
|
0.25
|
|
|
|
Export duties
|
|
|
|
0.18
|
|
|
|
|
—
|
|
|
|
|
0.16
|
|
|
|
|
—
|
|
|
|
Royalty on metals
|
|
|
|
0.18
|
|
c
|
|
|
0.11
|
|
|
|
|
0.17
|
|
c
|
|
|
0.12
|
|
|
|
Unit net cash costs
|
|
|
|
$
|
0.81
|
|
|
|
|
$
|
2.66
|
|
|
|
|
$
|
1.04
|
|
|
|
|
$
|
2.12
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
a. For a reconciliation of unit net cash costs per pound to
production and delivery costs applicable to sales reported in FCX's
consolidated financial statements, refer to the supplemental schedule,
"Product Revenues and Production Costs," beginning on page XIV, which is
available on FCX's website, "fcx.com."
b. The second quarter and first six months of 2014 excludes
fixed costs totaling $0.48 per pound of copper charged directly to cost
of sales as a result of the impact of export restrictions on PT-FI's
operating rates.
c. Includes $0.07 per pound of copper for the second quarter
and first six months of 2015 associated with PT-FI's increased royalty
rates pursuant to the MOU.
Indonesia's second-quarter 2015 sales of 196 million pounds of copper
and 346 thousand ounces of gold were higher than second-quarter 2014
sales of 117 million pounds of copper and 135 thousand ounces of gold,
primarily reflecting higher operating and recovery rates, and higher ore
grades for gold. PT-FI expects ore grades to increase beginning in
fourth-quarter 2015 through 2017 as high-grade sections of the Grasberg
open pit are mined.
At the Grasberg mine, the sequencing of mining areas with varying ore
grades causes fluctuations in quarterly and annual production of copper
and gold. Sales from Indonesia mining are expected to approximate 860
million pounds of copper and 1.3 million ounces of gold for the year
2015, compared with 664 million pounds of copper and 1.2 million ounces
of gold for the year 2014.
A significant portion of PT-FI's costs are fixed and unit costs vary
depending on production volumes. Indonesia's unit net cash costs
(including gold and silver credits) of $0.81 per pound of copper in
second-quarter 2015 were lower than unit net cash costs of $2.66 per
pound in second-quarter 2014, primarily reflecting higher gold and
silver credits and higher copper sales volumes, partly offset by the
impact of export duties and increased royalty rates.
Unit net cash costs (net of gold and silver credits) for Indonesia
mining are expected to approximate $1.08 per pound of copper for the
year 2015, based on current sales volume and cost estimates, and
assuming an average gold price of $1,150 per ounce for the second half
of 2015. Indonesia mining's projected unit net cash costs would change
by approximately $0.05 per pound for each $50 per ounce change in the
average price of gold for the second half of 2015. Because of the fixed
nature of a large portion of Indonesia's costs, unit costs vary from
quarter to quarter depending on copper and gold volumes.
Africa Mining. Through its 56 percent owned and consolidated
subsidiary Tenke Fungurume Mining S.A. (TFM), FCX operates in the Tenke
Fungurume (Tenke) minerals district in the Katanga province of the
Democratic Republic of Congo (DRC). In addition to copper, the Tenke
mine produces cobalt hydroxide.
Operating and Development Activities. TFM completed its second
phase expansion project in early 2013, which included increasing mine,
mill and processing capacity. Construction of a second sulphuric acid
plant is under way, with completion expected in the first half of 2016.
FCX continues to engage in exploration activities and metallurgical
testing to evaluate the potential of the highly prospective minerals
district at Tenke. These analyses are being incorporated in future plans
for potential expansions of production capacity. Future expansions are
subject to a number of factors, including power availability, economic
and market conditions, and the business and investment climate in the
DRC.
Operating Data. Following is summary consolidated operating data
for the Africa mining operations for the second quarters and first six
months of 2015 and 2014:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Six Months Ended
|
|
|
|
|
|
June 30,
|
|
|
June 30,
|
|
|
|
|
|
2015
|
|
|
2014
|
|
|
2015
|
|
|
2014
|
|
Copper (millions of recoverable pounds)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
|
|
|
|
115
|
|
|
|
114
|
|
|
|
231
|
|
|
|
223
|
|
|
Sales
|
|
|
|
104
|
|
|
|
118
|
|
|
|
237
|
|
|
|
202
|
|
|
Average realized price per pounda
|
|
|
|
$
|
2.63
|
|
|
|
$
|
3.08
|
|
|
|
$
|
2.66
|
|
|
|
$
|
3.08
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cobalt (millions of contained pounds)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
|
|
|
|
9
|
|
|
|
7
|
|
|
|
16
|
|
|
|
14
|
|
|
Sales
|
|
|
|
8
|
|
|
|
7
|
|
|
|
16
|
|
|
|
15
|
|
|
Average realized price per pound
|
|
|
|
$
|
9.27
|
|
|
|
$
|
9.58
|
|
|
|
$
|
9.23
|
|
|
|
$
|
9.29
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unit net cash costs per pound of copperb
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Site production and delivery, excluding adjustments
|
|
|
|
$
|
1.54
|
|
|
|
$
|
1.46
|
|
|
|
$
|
1.56
|
|
|
|
$
|
1.47
|
|
|
Cobalt creditsc
|
|
|
|
(0.53
|
)
|
|
|
(0.34
|
)
|
|
|
(0.44
|
)
|
|
|
(0.48
|
)
|
|
Royalty on metals
|
|
|
|
0.06
|
|
|
|
0.06
|
|
|
|
0.06
|
|
|
|
0.07
|
|
|
Unit net cash costs
|
|
|
|
$
|
1.07
|
|
|
|
$
|
1.18
|
|
|
|
$
|
1.18
|
|
|
|
$
|
1.06
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
a. Includes point-of-sale transportation costs as negotiated
in customer contracts.
b. For a reconciliation of unit net cash costs per pound to
production and delivery costs applicable to sales reported in FCX's
consolidated financial statements, refer to the supplemental schedules,
"Product Revenues and Production Costs," beginning on page XIV, which is
available on FCX's website, "fcx.com."
c. Net of cobalt downstream processing and freight costs.
TFM's copper sales of 104 million pounds in second-quarter 2015 were
lower than second-quarter 2014 copper sales of 118 million pounds
primarily because of timing of shipments. TFM's sales are expected to
approximate 460 million pounds of copper and 36 million pounds of cobalt
for the year 2015, compared with 425 million pounds of copper and 30
million pounds of cobalt for the year 2014.
Africa mining's unit net cash costs (net of cobalt credits) of $1.07 per
pound of copper in second-quarter 2015 were lower than unit net cash
costs of $1.18 per pound of copper in second-quarter 2014, primarily
reflecting higher cobalt credits, partly offset by lower copper sales
volumes. Unit net cash costs (net of cobalt credits) for Africa mining
are expected to approximate $1.12 per pound of copper for the year 2015,
based on current sales volume and cost estimates and assuming an average
cobalt price of $13 per pound for the second half of 2015. Africa
mining's projected unit net cash costs would change by approximately
$0.05 per pound for each $2 per pound change in the average price of
cobalt for the second half of 2015.
Molybdenum Mines. FCX has two wholly owned molybdenum mines in
North America - the Henderson underground mine and the Climax open-pit
mine, both in Colorado. The Henderson and Climax mines produce
high-purity, chemical-grade molybdenum concentrates, which are typically
further processed into value-added molybdenum chemical products. The
majority of molybdenum concentrates produced at the Henderson and Climax
mines, as well as from FCX's North and South America copper mines, are
processed at FCX's conversion facilities.
Production from the Molybdenum mines totaled 13 million pounds of
molybdenum in second-quarter 2015, 14 million pounds in second-quarter
2014, 26 million pounds in the first six months of 2015 and 27
million pounds in the first six months of 2014. Refer to summary
operating data on page 4 for FCX's consolidated molybdenum sales, which
includes sales of molybdenum produced at the Molybdenum mines, and from
FCX's North and South America copper mines.
Average unit net cash costs for the Molybdenum mines of $7.19 per pound
of molybdenum in second-quarter 2015 were higher than average unit net
cash costs of $6.47 per pound in second-quarter 2014, primarily
reflecting lower production volumes from the Henderson mine. Based on
current sales volume and cost estimates, unit net cash costs for the
Molybdenum mines are expected to average approximately $7.50 per pound
of molybdenum for the year 2015.
FCX continues to monitor market conditions and may adjust its molybdenum
operating plans as market conditions warrant. For a reconciliation of
unit net cash costs per pound to production and delivery costs
applicable to sales reported in FCX's consolidated financial statements,
refer to the supplemental schedules, "Product Revenues and Production
Costs," beginning on page XIV, which is available on FCX's website,
"fcx.com."
Mining Exploration Activities. FCX's mining exploration
activities are generally near its existing mines with a focus on
opportunities to expand reserves and resources to support development of
additional future production capacity in the large minerals districts
where it currently operates. Exploration results continue to indicate
opportunities for significant future potential reserve additions in
North and South America, and in the Tenke minerals district. The
drilling data in North America also indicates the potential for
significantly expanded sulfide production. Drilling results and
exploration modeling in North America have identified large-scale
potential sulfide resources in the Morenci and Safford/Lone Star
districts, providing a long-term pipeline for future growth in reserves
and production capacity in an established minerals district. Exploration
spending associated with mining operations is expected to approximate
$110 million for the year 2015, compared to $96 million in 2014.
OIL AND GAS OPERATIONS
Through its wholly owned oil and gas subsidiary, FCX Oil & Gas Inc. (FM
O&G), FCX's portfolio of oil and gas assets includes significant oil
production facilities and growth potential in the Deepwater Gulf of
Mexico (GOM), established oil production facilities onshore and offshore
California, large onshore natural gas resources in the Haynesville shale
play in Louisiana, natural gas production from the Madden area in
Central Wyoming, and a position in the Inboard Lower Tertiary/Cretaceous
natural gas trend onshore in South Louisiana. For the first six months
of 2015, 88 percent of FCX's oil and gas revenues, excluding the impact
of derivative contracts, were from oil and NGLs.
On June 23, 2015, Freeport-McMoRan Oil & Gas Inc. filed a registration
statement on Form S-1 with the U.S Securities and Exchange Commission
(SEC) related to its potential IPO of Class A common stock representing
a minority interest in the entity. Freeport-McMoRan Oil & Gas Inc.
intends to apply to list the common stock on the NYSE under the ticker
“FMOG.” The registration statement has not yet become effective, and
securities may not be sold nor may offers to buy be accepted prior to
the time the registration statement becomes effective.
FM O&G follows the full cost method of accounting whereby all costs
associated with oil and gas property acquisition, exploration and
development activities are capitalized and amortized to expense under
the unit-of-production method on a country-by-country basis using
estimates of proved oil and natural gas reserves relating to each
country where such activities are conducted. The costs of unproved oil
and gas properties are excluded from amortization until the properties
are evaluated.
Under the full cost accounting rules, a "ceiling test" is conducted each
quarter to review the carrying value of the oil and gas properties for
impairment. The SEC requires the twelve-month average of the
first-day-of-the-month historical reference oil price be used in
determining the ceiling amount. Using West Texas Intermediate (WTI) as
the reference oil price, the average price was $71.68 per barrel at June
30, 2015, compared with $82.72 per barrel at March 31, 2015. At June 30,
2015, net capitalized costs with respect to FM O&G's proved U.S. oil and
gas properties exceeded the ceiling amount specified by the SEC's full
cost accounting rules, which resulted in the recognition of an
impairment charge totaling $2.7 billion ($1.7 billion to net loss
attributable to common stock) for second-quarter 2015.
Because the ceiling test limitation uses a twelve-month historical
average price, if WTI oil prices remain below the June 30, 2015,
twelve-month average of $71.68 per barrel, the ceiling limitation will
decrease, resulting in potentially significant additional ceiling test
impairments of FCX's oil and gas properties. The WTI spot oil price was
$49.19 per barrel at July 22, 2015.
In addition to a decline in trailing average oil and gas prices, other
factors that could result in impairment of FCX's oil and gas properties
in future periods include costs transferred from unevaluated properties
to the full cost pool without corresponding proved oil and natural gas
reserve additions, negative reserve revisions and increased future
development or production costs. As FM O&G completes activities to
assess its $9.3 billion in unevaluated properties, related costs
currently recorded as unevaluated properties not subject to amortization
will be transferred to the full cost pool. If these activities do not
result in additions to discounted future net cash flows from proved oil
and natural gas reserves at least equal to the related costs transferred
(net of related tax effects), additional ceiling test impairments may
occur.
Financial and Operating Data. Following is summary financial and
operating data for the U.S. oil and gas operations for the second
quarters and first six months of 2015 and 2014:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Six Months Ended
|
|
|
|
|
|
June 30,
|
|
|
June 30,
|
|
|
|
|
|
2015
|
|
|
2014a
|
|
|
2015
|
|
|
2014a
|
|
Financial Summary (in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Realized revenuesb
|
|
|
|
$
|
656
|
|
|
|
$
|
1,243
|
|
|
|
$
|
1,203
|
|
|
|
$
|
2,488
|
|
Less: cash production costsb
|
|
|
|
249
|
|
|
|
314
|
|
|
|
503
|
|
|
|
612
|
|
Cash operating margin
|
|
|
|
$
|
407
|
|
|
|
$
|
929
|
|
|
|
$
|
700
|
|
|
|
$
|
1,876
|
|
Capital expenditures
|
|
|
|
$
|
777
|
|
|
|
$
|
903
|
|
|
|
$
|
1,795
|
|
|
|
$
|
1,484
|
|
Sales Volumes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil (MMBbls)
|
|
|
|
8.6
|
|
|
|
11.7
|
|
|
|
17.0
|
|
|
|
23.5
|
|
Natural gas (Bcf)
|
|
|
|
23.5
|
|
|
|
20.3
|
|
|
|
45.3
|
|
|
|
39.8
|
|
NGLs (MMBbls)
|
|
|
|
0.6
|
|
|
|
1.0
|
|
|
|
1.1
|
|
|
|
2.1
|
|
MMBOE
|
|
|
|
13.1
|
|
|
|
16.0
|
|
|
|
25.6
|
|
|
|
32.2
|
|
Average Realized Pricesb
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil (per barrel)
|
|
|
|
$
|
67.61
|
|
|
|
$
|
95.50
|
|
|
|
$
|
62.13
|
|
|
|
$
|
94.63
|
|
Natural gas (per million British thermal units, or MMBtu)
|
|
|
|
$
|
2.66
|
|
|
|
$
|
4.44
|
|
|
|
$
|
2.75
|
|
|
|
$
|
4.55
|
|
NGLs (per barrel)
|
|
|
|
$
|
20.50
|
|
|
|
$
|
38.79
|
|
|
|
$
|
21.71
|
|
|
|
$
|
42.35
|
|
Cash Operating Margin per BOEb
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Realized revenues
|
|
|
|
$
|
50.04
|
|
|
|
$
|
77.53
|
|
|
|
$
|
46.95
|
|
|
|
$
|
77.37
|
|
Less: cash production costs
|
|
|
|
19.04
|
|
|
|
19.57
|
|
|
|
19.62
|
|
|
|
19.03
|
|
Cash operating margin
|
|
|
|
$
|
31.00
|
|
|
|
$
|
57.96
|
|
|
|
$
|
27.33
|
|
|
|
$
|
58.34
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
a. The 2014 periods include results from the Eagle Ford field
through June 19, 2014. Eagle Ford had sales volumes totaling 4.0 MMBOE
for second-quarter 2014 and 8.7 MMBOE for the first six months of 2014;
excluding Eagle Ford, oil and gas cash production costs were $21.66 per
BOE for second-quarter 2014 and $21.29 per BOE for the first six months
of 2014.
b. Cash operating margin for oil and gas operations reflects
realized revenues less cash production costs. Realized revenues exclude
noncash mark-to-market adjustments on derivative contracts. For
reconciliations of realized revenues (including average realized prices
for oil, natural gas and NGLs) and cash production costs to revenues and
production and delivery costs reported in FCX's consolidated financial
statements, refer to the supplemental schedules, “Product Revenues and
Production Costs,” beginning on page XIV, which is available on FCX's
website, “fcx.com.”
In second-quarter 2015, FM O&G's average realized price for crude oil
was $67.61 per barrel, including $11.79 per barrel of realized cash
gains on derivative contracts. Excluding the impact of derivative
contracts, the second-quarter 2015 average realized price for crude oil
was $55.82 per barrel (88 percent of the average Brent crude oil price
of $63.57 per barrel).
FM O&G has derivative contracts that provide price protection averaging
between approximately $70 and $90 per barrel of Brent crude oil for more
than 80 percent of estimated 2015 oil production. Assuming an average
price of $56 per barrel for Brent crude oil, FCX would receive a benefit
of $20 per barrel on remaining 2015 derivative contract volumes of 15.46
million barrels, before taking into account weighted-average premiums of
$6.89 per barrel.
In second-quarter 2015, FM O&G's average realized price for natural gas
was $2.66 per MMBtu, compared to the New York Mercantile Exchange
natural gas price average of $2.65 per MMBtu for the April through June
2015 contracts.
Realized revenues for oil and gas operations of $50.04 per BOE in
second-quarter 2015 were lower than realized revenues of $77.53 per BOE
in second-quarter 2014, primarily reflecting lower oil prices, partially
offset by the impact of higher cash gains on derivative contracts (cash
gains were $101 million or $7.73 per BOE in second-quarter 2015,
compared with losses of $63 million or $3.94 per BOE in second-quarter
2014).
Cash production costs for oil and gas operations of $19.04 per BOE in
second-quarter 2015 were lower than cash production costs of $19.57 per
BOE in second-quarter 2014, primarily reflecting lower cash production
costs in California related to reductions in repair and maintenance
costs and well workover expense.
Following is a summary of average oil and gas sales volumes per day by
region for the second quarters and first six months of 2015 and
2014:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Six Months Ended
|
|
|
|
|
|
June 30,
|
|
|
June 30,
|
|
Sales Volumes (MBOE per day)
|
|
|
|
2015
|
|
|
2014
|
|
|
2015
|
|
|
2014
|
|
GOMa
|
|
|
|
80
|
|
|
|
75
|
|
|
|
77
|
|
|
|
73
|
|
California
|
|
|
|
38
|
|
|
|
39
|
|
|
|
39
|
|
|
|
39
|
|
Haynesville/Madden/Other
|
|
|
|
26
|
|
|
|
18
|
|
|
|
26
|
|
|
|
18
|
|
Eagle Fordb
|
|
|
|
—
|
|
|
|
44
|
|
|
|
—
|
|
|
|
48
|
|
Total oil and gas operations
|
|
|
|
144
|
|
|
|
176
|
|
|
|
142
|
|
|
|
178
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
a. Includes sales from properties on the GOM Shelf and in the
Deepwater GOM.
b. FM O&G completed the sale of Eagle Ford in June 2014.
Daily sales volumes averaged 144 MBOE for second-quarter 2015, including
95 thousand barrels (MBbls) of crude oil, 259 million cubic feet (MMcf)
of natural gas and 5 MBbls of NGLs. Oil and gas sales volumes are
expected to average 143 MBOE per day for the year 2015, comprised of 67
percent oil, 29 percent natural gas and 4 percent NGLs.
Based on current sales volume and cost estimates, cash production costs
are expected to approximate $19 per BOE for the year 2015.
Oil and Gas Exploration, Operating and Development Activities. FCX's
oil and gas business has significant proved, probable and possible
reserves, a broad range of development opportunities and high-potential
exploration prospects. The business is managed to reinvest its cash
flows in projects with attractive rates of return and risk profiles.
Following the sharp decline in oil prices in late 2014, FCX has taken
steps to significantly reduce capital spending plans and is evaluating
funding opportunities for capital expenditures for its oil and gas
business, including the potential IPO for a minority interest in
Freeport-McMoRan Oil & Gas Inc.
FM O&G is focused on growing its strategic position in the Deepwater GOM
with significant current oil production, strong cash margins and
existing infrastructure and facilities with excess production and
handling capacity. These assets, combined with FM O&G’s large leasehold
interests in an established geologic basin, provide financially
attractive investment opportunities for high-impact growth in oil
production and cash margins. FM O&G’s capital allocation strategy is
principally focused on development opportunities that can be tied back
to existing facilities.
During second-quarter 2015, FM O&G achieved several important
accomplishments, principally in its Deepwater GOM focus areas, that are
expected to contribute to future growth. Production reached full
capacity at the Lucius facility and development advanced at the Heidelberg
field. Positive drilling results were achieved at the Holstein Deep,
Quebec/Victory (QV), Kilo/Oscar (KO) and Horn Mountain Updip tieback
prospects. Since commencing development activities in 2014 at its three
100-percent-owned production platforms in the Deepwater GOM, FM O&G has
drilled 10 wells with positive results. Three of these wells have been
brought on production, and FM O&G plans to complete and place in
production four wells over the next 12 months and the remaining three
wells in 2017. Longer term, FM O&G's production is expected to benefit
from the success in the Atwater Valley focus area, where multiple
discoveries have been drilled to date. During second-quarter 2015, FM
O&G commenced drilling at the Deep Sleep exploration well in
the Atwater Valley focus area and the MZ-1 exploration well
offshore Morocco.
U.S. Oil and Gas Capital Expenditures. Capital expenditures for
U.S. oil and gas operations totaled $0.8 billion (including $0.6 billion
incurred for the Deepwater GOM and $0.1 billion for the Inboard Lower
Tertiary/Cretaceous natural gas trend) for second-quarter 2015 and $1.8
billion (including $1.2 billion incurred for Deepwater GOM and $0.2
billion for the Inboard Lower Tertiary/Cretaceous natural gas trend) for
the first six months of 2015.
Capital expenditures for oil and gas operations are estimated to total
$2.8 billion for the year 2015, with approximately 85 percent of the
2015 capital budget expected to be directed to the highest potential
return focus areas in the GOM.
Deepwater GOM. The drilling and evaluation of multiple
development and exploration opportunities in the Deepwater GOM is in
progress. These prospects benefit from tieback opportunities to
significant available production capacity at the FM O&G operated
large-scale Holstein, Marlin and Horn Mountain deepwater production
platforms. In addition, FM O&G has interests in the Lucius and
Heidelberg oil fields, and in the Atwater Valley focus area.
After successfully commencing first production in January 2015, the Lucius
oil facility in Keathley Canyon reached capacity of 80 MBbls of
oil per day in second-quarter 2015. FM O&G has a 25.1 percent working
interest in Lucius, which consists of six subsea wells located in 7,200
feet of water tied back to a truss spar hull.
Field development continued at Heidelberg in the Green Canyon
focus area during second-quarter 2015. Fabrication of the main topsides
module is complete, the hull is on location, and mooring lines are
completed. The Heidelberg truss spar was designed as a Lucius-look-alike
facility with capacity of 80 MBbls of oil per day. Development drilling
in the field is ongoing and first production is anticipated in mid-2016.
FM O&G has a 12.5 percent working interest in Heidelberg, which is a
large, high-quality oil development project located in 5,300 feet of
water.
In July 2015, FM O&G logged its third successful subsalt Miocene
delineation well at the 100-percent-owned Holstein Deep
development project in the Green Canyon focus area since commencing
drilling in the area in third-quarter 2014. The third delineation well,
which is the most updip in the reservoir, was drilled to 29,440 feet and
wireline logs indicated that the well encountered approximately 200 feet
of net oil pay. Drilling results from this initial three-well
development program successfully established sand continuity across the
primary reservoir.
Completion activities for the initial three-well subsea tieback
development program are expected to commence in third-quarter 2015 and
production is expected to begin in 2016. Successful results from the
initial three-well drilling program established opportunities for
additional wells. When fully developed, this project will have the
potential to produce up to 75 MBOE per day. The Holstein Deep
development is located in Green Canyon Block 643, west of the Holstein
platform in 3,890 feet of water with production facilities capable of
processing 113 MBbls of oil per day.
FM O&G’s 100-percent-owned Marlin Hub is located in the Mississippi
Canyon focus area and has production facilities capable of
processing 60 MBbls of oil per day. Several tieback opportunities have
been identified, including the 100-percent-owned Dorado and King
development projects. Future wells can be brought on-line using existing
infrastructure with the potential to utilize subsea enhancement
technologies that could increase total recovery efficiencies. In
second-quarter 2015, FM O&G completed maintenance activities, including
the installation of new export flow line flex joints, which will extend
the life of the Marlin platform.
The initial FM O&G drilled Dorado well was placed in
production in March 2015 after a successful production test in excess of
8 MBOE per day and continues to produce at strong rates. Drilling
operations for the second and third wells, which are targeting similar
undrained fault blocks and updip resource potential south of the Marlin
facility, are expected to begin in 2016. The Dorado development is
located on Viosca Knoll Block 915 in 3,860 feet of water.
Initial production from the first development well at King is
expected to commence in fourth-quarter 2015, and additional drilling is
planned in the area starting in the second-half of 2015. King is located
in Mississippi Canyon south of the Marlin facility in 5,200 feet of
water.
FM O&G’s 100-percent-owned Horn Mountain field is also
located in the Mississippi Canyon focus area and has production
facilities capable of processing 75 MBbls of oil per day. To enhance
recovery of remaining oil in place, future development plans will target
subsea tieback from multiple stacked sands in the area. In
second-quarter 2015, the QV well, the first location of this
program, was drilled to 14,780 feet and successfully encountered 355
feet of oil and gas pay as indicated by wireline logs. FM O&G plans to
complete this well and place it in production in 2017. In June 2015,
drilling operations commenced at the KO and Horn
Mountain Updip wells. In July 2015, interim results from KO
indicated the well encountered 62 feet of oil pay and drilling continues
to evaluate additional objectives. At Horn Mountain Updip, the well was
drilled to a total depth of 14,780 feet in July 2015 and successfully
logged 83 feet of oil pay. These infill wells are targeting undrained
fault blocks and updip resource potential east and west of the Horn
Mountain facility, which is located in approximately 5,400 feet of water.
FM O&G has an 18.67 percent working interest in the Vito oil
discovery and a significant lease position in the Atwater Valley focus
area. Vito is a large, deep subsalt Miocene oil discovery made in 2009,
located in approximately 4,000 feet of water. Exploration and
delineation drilling in recent years confirmed a significant resource in
high-quality, subsalt Miocene sands. Development options are under
evaluation, and FM O&G expects the operator to propose a sanctioning
development plan in 2016.
As previously reported, success at the Power Nap exploration well
and appraisal sidetracks, which are located in close proximity to Vito,
produced positive results, and development options are being assessed.
The neighboring Deep Sleep exploration well in the greater
Mars/Ursa basin commenced drilling in June 2015. Deep Sleep is located
in 4,200 feet of water approximately five miles south of Power Nap. FM
O&G owns a 50 percent working interest in the Power Nap and Deep Sleep
prospects.
Inboard Lower Tertiary/Cretaceous. FM O&G has a position in the
Inboard Lower Tertiary/Cretaceous natural gas trend, located onshore in
South Louisiana.
In second-quarter 2015, the Highlander well, which has been
restricted because of limited processing facilities, averaged a gross
rate of 22 MMcf per day (approximately 11 MMcf per day net to FM O&G).
As previously reported, production testing in February 2015 indicated a
flow rate of 75 MMcf per day (approximately 37 MMcf per day net to FM
O&G). FM O&G is developing additional processing facilities to
accommodate the higher flow rates with installation expected by year-end
2015. In July 2015, the Highlander well was shut in for remedial
workover operations to address a mechanical issue encountered in the
wellbore. A second well location has been identified, and future plans
are being considered. FM O&G is the operator and has a 72 percent
working interest and an approximate 49 percent net revenue interest in
Highlander. FM O&G has identified multiple additional locations on the
Highlander structure, which is located onshore in South Louisiana where
FM O&G controls rights to more than 50,000 gross acres.
California. Sales volumes from California averaged 38 MBOE per
day for second-quarter 2015, compared with 39 MBOE per day for
second-quarter 2014. FM O&G’s position in California is located onshore
in the San Joaquin Valley and Los Angeles Basin, and offshore in the
Point Arguello and Point Pedernales fields. During second-quarter 2015,
production from Point Arguello platforms, which produced approximately 2
MBOE per day in first-quarter 2015, was temporarily shut in following
the shutdown of a third-party operated pipeline system that transports
oil to various California refineries.
Haynesville. FM O&G has rights to a substantial natural gas
resource, located in the Haynesville shale play in North Louisiana.
Drilling activities remain constrained in response to low natural gas
prices in order to maximize near-term cash flows and to preserve the
resource for potentially higher future natural gas prices.
International Exploration (Morocco). In May 2015, FM O&G
commenced drilling the MZ-1 well associated with the Ouanoukrim
prospect in the Mazagan permit area offshore Morocco under a farm-in
arrangement to earn interests in exploration blocks. The well is
currently drilling below 15,260 feet towards a proposed total depth of
approximately 18,500 feet. The exploration area covers 2.2 million gross
acres in water depths of 4,500 to 9,900 feet. Capital expenditures for
international oil and gas exploration activities in Morocco totaled $29
million for second-quarter 2015 and $44 million for the first six months
of 2015.
CASH FLOWS, CASH and DEBT
Operating Cash Flows. FCX generated operating cash flows of $1.1
billion (net of $104 million in working capital uses and changes in
other tax payments) for second-quarter 2015 and $1.8 billion (net of
$190 million in working capital uses and changes in other tax payments)
for the first six months of 2015.
Based on current sales volume and cost estimates and assuming average
prices of $2.50 per pound of copper, $1,150 per ounce of gold, $6 per
pound of molybdenum and $56 per barrel of Brent crude oil for the second
half of 2015, FCX's consolidated operating cash flows are estimated to
approximate $3.6 billion for the year 2015. The impact of price changes
for the second half of 2015 on operating cash flows would approximate
$190 million for each $0.10 per pound change in the average price of
copper, $25 million for each $50 per ounce change in the average price
of gold, $60 million for each $2 per pound change in the average price
of molybdenum and $55 million for each $5 per barrel change in the
average Brent crude oil price.
Capital Expenditures. Capital expenditures totaled $1.7 billion
for second-quarter 2015 (including $0.6 billion for major projects at
mining operations and $0.8 billion for oil and gas operations) and $3.5
billion for the first six months of 2015 (including $1.2 billion
for major projects at mining operations and $1.8 billion for oil and gas
operations).
Capital expenditures are currently expected to approximate $6.3 billion
for the year 2015, including $2.5 billion for major projects at mining
operations (primarily for the Cerro Verde expansion and underground
development activities at Grasberg) and $2.8 billion for oil and gas
operations. FCX has made substantial progress toward the completion of
its major mining development projects, which are expected to result in
increased near-term production, lower unit costs, declining capital
expenditures and growth in free cash flow over the next several
quarters. In addition, positive oil and gas drilling and development
activities are expected to result in a growing oil production profile.
FCX remains focused on maintaining a strong balance sheet and on
continuing to manage costs, capital spending plans and other actions as
required to maintain financial strength. FCX has a broad set of natural
resource assets that provide many alternatives for future actions to
enhance its financial flexibility.
Cash. Following is a summary of cash available to the parent
company, net of noncontrolling interests' share, taxes and other costs
at June 30, 2015 (in millions):
|
|
|
|
|
|
|
|
|
Cash at domestic companies
|
|
|
|
$
|
29
|
|
|
Cash at international operations
|
|
|
|
437
|
|
|
Total consolidated cash and cash equivalents
|
|
|
|
466
|
|
|
Less: noncontrolling interests' share
|
|
|
|
(119
|
)
|
|
Cash, net of noncontrolling interests' share
|
|
|
|
347
|
|
|
Less: withholding taxes and other
|
|
|
|
(19
|
)
|
|
Net cash available
|
|
|
|
$
|
328
|
|
|
|
|
|
|
|
|
|
Debt. FCX remains committed to a strong balance sheet and will
take prudent actions in response to market conditions. FCX has taken
steps to sell assets, defer capital spending and reduce dividends on its
common stock. FCX will continue to evaluate its portfolio for potential
future actions. Following is a summary of total debt and related
weighted-average interest rates at June 30, 2015 (in billions, except
percentages):
|
|
|
|
|
|
|
|
|
Weighted-
|
|
|
|
|
|
|
|
|
|
Average
|
|
|
|
|
|
|
|
|
|
Interest Rate
|
|
FCX Senior Notes
|
|
|
|
$
|
11.9
|
|
|
|
|
3.8
|
%
|
|
FCX Term Loan
|
|
|
|
3.0
|
|
|
|
|
1.9
|
%
|
|
FM O&G Senior Notes
|
|
|
|
2.6
|
|
|
|
|
6.6
|
%
|
|
Cerro Verde Credit Facility
|
|
|
|
1.3
|
|
a
|
|
|
2.1
|
%
|
|
Other FCX debt
|
|
|
|
2.1
|
|
b
|
|
|
2.7
|
%
|
|
|
|
|
|
$
|
20.9
|
|
|
|
|
3.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
a. Cerro Verde had $1.3 billion of borrowings outstanding and
no letters of credit issued under its $1.8 billion credit facility to
fund a portion of its expansion project and for its general corporate
purposes.
b. FCX had $985 million of borrowings outstanding and $42
million in letters of credit issued under its $4 billion revolving
credit facility. FCX also has uncommitted and short-term lines of credit
with certain financial institutions that are unsecured, which have terms
and pricing that are generally more favorable than our revolving credit
facility. At June 30, 2015, there was $410 million of borrowings drawn
under these lines of credit.
FINANCIAL POLICY
FCX has a long-standing tradition of seeking to build shareholder value
through investing in projects with attractive rates of return and
returning cash to shareholders through common stock dividends and share
purchases. FCX paid common stock dividends of $380 million in the first
six months of 2015.
On June 24, 2015, FCX's Board of Directors (the Board) declared a
regular quarterly dividend of $0.05 per share and a one-time special
dividend of $0.1105 per share in accordance with the approved settlement
terms of shareholder derivative litigation. Both the regular quarterly
dividend and the special dividend will be paid on August 3, 2015. The
declaration of dividends is at the discretion of the Board and will
depend upon FCX's financial results, cash requirements, future prospects
and other factors deemed relevant by the Board.
FCX intends to continue to maintain a strong financial position, with a
focus on reducing debt while continuing to invest in attractive growth
projects and providing cash returns to shareholders. The Board will
continue to review FCX's financial policy on an ongoing basis and
anticipates increasing cash returns to shareholders as market and
business conditions warrant.
WEBCAST INFORMATION
A conference call with securities analysts to discuss FCX's
second-quarter 2015 results is scheduled for today at 10:00 a.m. Eastern
Time. The conference call will be broadcast on the Internet along with
slides. Interested parties may listen to the conference call live and
view the slides by accessing "fcx.com." A replay of the webcast will be
available through Friday, August 21, 2015.
-----------------------------------------------------------------------------------------------------------
FCX is a premier U.S.-based natural resources company with an
industry-leading global portfolio of mineral assets, significant oil and
gas resources and a growing production profile. FCX is the world's
largest publicly traded copper producer.
FCX's portfolio of assets includes the Grasberg minerals district in
Indonesia, one of the world's largest copper and gold deposits;
significant mining operations in the Americas, including the large-scale
Morenci minerals district in North America and the Cerro Verde operation
in South America; the Tenke Fungurume minerals district in the DRC; and
significant U.S. oil and natural gas assets in the Deepwater GOM,
onshore and offshore California and in the Haynesville natural gas
shale, and a position in the Inboard Lower Tertiary/Cretaceous natural
gas trend onshore in South Louisiana. Additional information about FCX
is available on FCX's website at "fcx.com."
Cautionary Statement and Regulation G Disclosure: This
press release contains forward-looking statements in which FCX discusses
its potential future performance. Forward-looking statements are all
statements other than statements of historical facts, such as
projections or expectations relating to ore grades and milling rates,
production and sales volumes, unit net cash costs, cash production costs
per BOE, operating cash flows, capital expenditures, exploration efforts
and results, development and production activities and costs, liquidity,
tax rates, the impact of copper, gold, molybdenum, cobalt, crude oil and
natural gas price changes, the impact of derivative positions, the
impact of deferred intercompany profits on earnings, reserve estimates,
future dividend payments, debt reduction and share purchases. The words
“anticipates,” “may,” “can,” “plans,” “believes,” “estimates,”
“expects,” “projects,” "targets," “intends,” “likely,” “will,” “should,”
“to be,” ”potential" and any similar expressions are intended to
identify those assertions as forward-looking statements. The declaration
of dividends is at the discretion of the Board and will depend on FCX's
financial results, cash requirements, future prospects, and other
factors deemed relevant by the Board.
FCX cautions readers that forward-looking statements are not
guarantees of future performance and actual results may differ
materially from those anticipated, projected or assumed in the
forward-looking statements. Important factors that can cause FCX's
actual results to differ materially from those anticipated in the
forward-looking statements include supply of and demand for, and prices
of, copper, gold, molybdenum, cobalt, crude oil and natural gas, mine
sequencing, production rates, industry risks, regulatory changes,
political risks, drilling results, potential additional oil and gas
property impairment charges, the outcome of ongoing discussions with the
Indonesian government regarding an amendment to PT-FI's COW, PT-FI's
ability to obtain renewal of its export license after July 25, 2015, the
potential effects of violence in Indonesia, the resolution of
administrative disputes in the DRC, labor relations, weather- and
climate-related risks, environmental risks, litigation results and other
factors described in more detail under the heading “Risk Factors” in
FCX's Annual Report on Form 10-K for the year ended December 31, 2014,
filed with the U.S. Securities and Exchange Commission (SEC) as updated
by FCX's subsequent filings with the SEC.
Investors are cautioned that many of the assumptions upon which FCX's
forward-looking statements are based are likely to change after the
forward-looking statements are made, including for example commodity
prices, which FCX cannot control, and production volumes and costs, some
aspects of which FCX may not be able to control. Further, FCX may make
changes to its business plans that could affect its results. FCX
cautions investors that it does not intend to update forward-looking
statements more frequently than quarterly notwithstanding any changes in
its assumptions, changes in business plans, actual experience or other
changes, and FCX undertakes no obligation to update any forward-looking
statements.
This press release also contains certain financial measures such as
unit net cash costs per pound of copper and molybdenum, oil and gas
realized revenues, cash production costs and cash operating margin,
which are not recognized under U.S. generally accepted accounting
principles. As required by SEC Regulation G, reconciliations of these
measures to amounts reported in FCX's consolidated financial statements
are in the supplemental schedules of this press release, which are also
available on FCX's website, "fcx.com."
|
|
|
|
|
|
|
|
|
|
|
FREEPORT-McMoRan INC.
|
|
SELECTED MINING OPERATING DATA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
|
|
|
|
Production
|
|
Sales
|
|
COPPER (millions of recoverable pounds)
|
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
(FCX's net interest in %)
|
|
|
|
|
|
|
|
|
|
|
|
North America
|
|
|
|
|
|
|
|
|
|
|
|
Morenci (85%)a
|
|
|
|
219
|
|
153
|
|
|
225
|
|
|
164
|
|
Bagdad (100%)
|
|
|
|
51
|
|
59
|
|
|
56
|
|
|
64
|
|
Safford (100%)
|
|
|
|
39
|
|
34
|
|
|
40
|
|
|
38
|
|
Sierrita (100%)
|
|
|
|
48
|
|
51
|
|
|
51
|
|
|
54
|
|
Miami (100%)
|
|
|
|
12
|
|
15
|
|
|
12
|
|
|
16
|
|
Chino (100%)
|
|
|
|
76
|
|
57
|
|
|
78
|
|
|
60
|
|
Tyrone (100%)
|
|
|
|
23
|
|
24
|
|
|
23
|
|
|
25
|
|
Other (100%)
|
|
|
|
1
|
|
2
|
|
|
1
|
|
|
2
|
|
Total North America
|
|
|
|
469
|
|
395
|
|
|
486
|
|
|
423
|
|
|
|
|
|
|
|
|
|
|
|
|
|
South America
|
|
|
|
|
|
|
|
|
|
|
|
Cerro Verde (53.56%)
|
|
|
|
104
|
|
125
|
|
|
97
|
|
|
138
|
|
El Abra (51%)
|
|
|
|
84
|
|
93
|
|
|
81
|
|
|
92
|
|
Candelaria/Ojos del Salado (80%)b
|
|
|
|
—
|
|
82
|
|
|
—
|
|
|
80
|
|
Total South America
|
|
|
|
188
|
|
300
|
|
|
178
|
|
|
310
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Indonesia
|
|
|
|
|
|
|
|
|
|
|
|
Grasberg (90.64%)c
|
|
|
|
205
|
|
122
|
|
|
196
|
|
|
117
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Africa
|
|
|
|
|
|
|
|
|
|
|
|
Tenke Fungurume (56%)
|
|
|
|
115
|
|
114
|
|
|
104
|
|
|
118
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
|
|
|
|
977
|
|
931
|
|
|
964
|
|
|
968
|
|
Less noncontrolling interests
|
|
|
|
160
|
|
182
|
|
|
149
|
|
|
188
|
|
Net
|
|
|
|
817
|
|
749
|
|
|
815
|
|
|
780
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated sales from mines
|
|
|
|
|
|
|
|
|
964
|
|
|
968
|
|
Purchased copper
|
|
|
|
|
|
|
|
|
24
|
|
|
34
|
|
Total copper sales, including purchases
|
|
|
|
|
|
|
|
|
988
|
|
|
1,002
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average realized price per pound
|
|
|
|
|
|
|
|
$
|
2.71
|
|
$
|
3.16
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GOLD (thousands of recoverable ounces)
|
|
|
|
|
|
|
|
|
|
|
|
(FCX's net interest in %)
|
|
|
|
|
|
|
|
|
|
|
|
North America (100%)
|
|
|
|
7
|
|
3
|
|
|
6
|
|
|
4
|
|
South America (80%)b
|
|
|
|
—
|
|
21
|
|
|
—
|
|
|
20
|
|
Indonesia (90.64%)c
|
|
|
|
360
|
|
142
|
|
|
346
|
|
|
135
|
|
Consolidated
|
|
|
|
367
|
|
166
|
|
|
352
|
|
|
159
|
|
Less noncontrolling interests
|
|
|
|
34
|
|
17
|
|
|
33
|
|
|
16
|
|
Net
|
|
|
|
333
|
|
149
|
|
|
319
|
|
|
143
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average realized price per ounce
|
|
|
|
|
|
|
|
$
|
1,174
|
|
$
|
1,296
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MOLYBDENUM (millions of recoverable pounds)
|
|
|
|
|
|
|
|
|
|
|
|
(FCX's net interest in %)
|
|
|
|
|
|
|
|
|
|
|
|
Henderson (100%)
|
|
|
|
7
|
|
8
|
|
|
N/A
|
|
|
N/A
|
|
Climax (100%)
|
|
|
|
6
|
|
6
|
|
|
N/A
|
|
|
N/A
|
|
North America copper mines (100%)a
|
|
|
|
10
|
|
9
|
|
|
N/A
|
|
|
N/A
|
|
Cerro Verde (53.56%)
|
|
|
|
2
|
|
2
|
|
|
N/A
|
|
|
N/A
|
|
Consolidated
|
|
|
|
25
|
|
25
|
|
|
23
|
|
|
25
|
|
Less noncontrolling interests
|
|
|
|
1
|
|
1
|
|
|
1
|
|
|
1
|
|
Net
|
|
|
|
24
|
|
24
|
|
|
22
|
|
|
24
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average realized price per pound
|
|
|
|
|
|
|
|
$
|
9.51
|
|
$
|
13.43
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COBALT (millions of contained pounds)
|
|
|
|
|
|
|
|
|
|
|
|
(FCX's net interest in %)
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated - Tenke Fungurume (56%)
|
|
|
|
9
|
|
7
|
|
|
8
|
|
|
7
|
|
Less noncontrolling interests
|
|
|
|
4
|
|
3
|
|
|
4
|
|
|
3
|
|
Net
|
|
|
|
5
|
|
4
|
|
|
4
|
|
|
4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average realized price per pound
|
|
|
|
|
|
|
|
$
|
9.27
|
|
$
|
9.58
|
|
|
|
|
|
|
|
|
|
|
|
|
|
a. Amounts are net of Morenci's 15 percent joint venture
partner's interest.
|
|
b. On November 3, 2014, FCX completed the sale of its 80
percent interests in the Candelaria and Ojos del Salado mines.
|
|
c. Amounts are net of Grasberg's joint venture partner's
interest, which varies in accordance with the terms of the joint
venture agreement.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FREEPORT-McMoRan INC.
|
|
SELECTED MINING OPERATING DATA (continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30,
|
|
|
|
|
|
Production
|
|
Sales
|
|
COPPER (millions of recoverable pounds)
|
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
(FCX's net interest in %)
|
|
|
|
|
|
|
|
|
|
|
|
North America
|
|
|
|
|
|
|
|
|
|
|
|
Morenci (85%)a
|
|
|
|
424
|
|
301
|
|
|
436
|
|
|
308
|
|
Bagdad (100%)
|
|
|
|
104
|
|
117
|
|
|
114
|
|
|
120
|
|
Safford (100%)
|
|
|
|
79
|
|
71
|
|
|
81
|
|
|
74
|
|
Sierrita (100%)
|
|
|
|
95
|
|
101
|
|
|
100
|
|
|
100
|
|
Miami (100%)
|
|
|
|
23
|
|
29
|
|
|
25
|
|
|
31
|
|
Chino (100%)
|
|
|
|
149
|
|
110
|
|
|
153
|
|
|
109
|
|
Tyrone (100%)
|
|
|
|
45
|
|
47
|
|
|
47
|
|
|
48
|
|
Other (100%)
|
|
|
|
2
|
|
4
|
|
|
2
|
|
|
4
|
|
Total North America
|
|
|
|
921
|
|
780
|
|
|
958
|
|
|
794
|
|
|
|
|
|
|
|
|
|
|
|
|
|
South America
|
|
|
|
|
|
|
|
|
|
|
|
Cerro Verde (53.56%)
|
|
|
|
211
|
|
260
|
|
|
207
|
|
|
261
|
|
El Abra (51%)
|
|
|
|
170
|
|
185
|
|
|
171
|
|
|
182
|
|
Candelaria/Ojos del Salado (80%)b
|
|
|
|
—
|
|
169
|
|
|
—
|
|
|
174
|
|
Total South America
|
|
|
|
381
|
|
614
|
|
|
378
|
|
|
617
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Indonesia
|
|
|
|
|
|
|
|
|
|
|
|
Grasberg (90.64%)c
|
|
|
|
359
|
|
262
|
|
|
351
|
|
|
226
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Africa
|
|
|
|
|
|
|
|
|
|
|
|
Tenke Fungurume (56%)
|
|
|
|
231
|
|
223
|
|
|
237
|
|
|
202
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
|
|
|
|
1,892
|
|
1,879
|
|
|
1,924
|
|
|
1,839
|
|
Less noncontrolling interests
|
|
|
|
317
|
|
368
|
|
|
317
|
|
|
355
|
|
Net
|
|
|
|
1,575
|
|
1,511
|
|
|
1,607
|
|
|
1,484
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated sales from mines
|
|
|
|
|
|
|
|
|
1,924
|
|
|
1,839
|
|
Purchased copper
|
|
|
|
|
|
|
|
|
64
|
|
|
66
|
|
Total copper sales, including purchases
|
|
|
|
|
|
|
|
|
1,988
|
|
|
1,905
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average realized price per pound
|
|
|
|
|
|
|
|
$
|
2.70
|
|
$
|
3.17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GOLD (thousands of recoverable ounces)
|
|
|
|
|
|
|
|
|
|
|
|
(FCX's net interest in %)
|
|
|
|
|
|
|
|
|
|
|
|
North America (100%)
|
|
|
|
11
|
|
5
|
|
|
9
|
|
|
6
|
|
South America (80%)b
|
|
|
|
—
|
|
42
|
|
|
—
|
|
|
43
|
|
Indonesia (90.64%)c
|
|
|
|
615
|
|
350
|
|
|
606
|
|
|
297
|
|
Consolidated
|
|
|
|
626
|
|
397
|
|
|
615
|
|
|
346
|
|
Less noncontrolling interests
|
|
|
|
58
|
|
41
|
|
|
57
|
|
|
36
|
|
Net
|
|
|
|
568
|
|
356
|
|
|
558
|
|
|
310
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average realized price per ounce
|
|
|
|
|
|
|
|
$
|
1,183
|
|
$
|
1,299
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MOLYBDENUM (millions of recoverable pounds)
|
|
|
|
|
|
|
|
|
|
|
|
(FCX's net interest in %)
|
|
|
|
|
|
|
|
|
|
|
|
Henderson (100%)
|
|
|
|
14
|
|
16
|
|
|
N/A
|
|
|
N/A
|
|
Climax (100%)
|
|
|
|
12
|
|
11
|
|
|
N/A
|
|
|
N/A
|
|
North America copper mines (100%)a
|
|
|
|
19
|
|
17
|
|
|
N/A
|
|
|
N/A
|
|
Cerro Verde (53.56%)
|
|
|
|
4
|
|
5
|
|
|
N/A
|
|
|
N/A
|
|
Consolidated
|
|
|
|
49
|
|
49
|
|
|
46
|
|
|
52
|
|
Less noncontrolling interests
|
|
|
|
2
|
|
3
|
|
|
2
|
|
|
3
|
|
Net
|
|
|
|
47
|
|
46
|
|
|
44
|
|
|
49
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average realized price per pound
|
|
|
|
|
|
|
|
$
|
9.84
|
|
$
|
12.27
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COBALT (millions of contained pounds)
|
|
|
|
|
|
|
|
|
|
|
|
(FCX's net interest in %)
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated - Tenke Fungurume (56%)
|
|
|
|
16
|
|
14
|
|
|
16
|
|
|
15
|
|
Less noncontrolling interests
|
|
|
|
7
|
|
6
|
|
|
7
|
|
|
7
|
|
Net
|
|
|
|
9
|
|
8
|
|
|
9
|
|
|
8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average realized price per pound
|
|
|
|
|
|
|
|
$
|
9.23
|
|
$
|
9.29
|
|
|
|
|
|
|
|
|
|
|
|
|
|
a. Amounts are net of Morenci's 15 percent joint venture
partner's interest.
|
|
b. On November 3, 2014, FCX completed the sale of its 80
percent interests in the Candelaria and Ojos del Salado mines.
|
|
c. Amounts are net of Grasberg's joint venture partner's
interest, which varies in accordance with the terms of the joint
venture agreement.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FREEPORT-McMoRan INC.
|
|
SELECTED MINING OPERATING DATA (continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
|
|
|
June 30,
|
|
June 30,
|
|
|
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
100% North America Copper Mines
|
|
|
|
|
|
|
|
|
|
|
|
Solution Extraction/Electrowinning (SX/EW) Operations
|
|
|
|
|
|
|
|
|
|
|
|
Leach ore placed in stockpiles (metric tons per day)
|
|
|
|
890,000
|
|
1,044,500
|
|
902,500
|
|
1,014,000
|
|
Average copper ore grade (percent)
|
|
|
|
0.26
|
|
0.25
|
|
0.25
|
|
0.25
|
|
Copper production (millions of recoverable pounds)
|
|
|
|
261
|
|
234
|
|
508
|
|
463
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mill Operations
|
|
|
|
|
|
|
|
|
|
|
|
Ore milled (metric tons per day)
|
|
|
|
316,000
|
|
260,100
|
|
308,800
|
|
257,700
|
|
Average ore grades (percent):
|
|
|
|
|
|
|
|
|
|
|
|
Copper
|
|
|
|
0.47
|
|
0.44
|
|
0.48
|
|
0.43
|
|
Molybdenum
|
|
|
|
0.03
|
|
0.03
|
|
0.03
|
|
0.03
|
|
Copper recovery rate (percent)
|
|
|
|
85.8
|
|
82.8
|
|
85.6
|
|
84.4
|
|
Production (millions of recoverable pounds):
|
|
|
|
|
|
|
|
|
|
|
|
Copper
|
|
|
|
247
|
|
188
|
|
488
|
|
370
|
|
Molybdenum
|
|
|
|
10
|
|
9
|
|
19
|
|
17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
100% South America Mininga
|
|
|
|
|
|
|
|
|
|
|
|
SX/EW Operations
|
|
|
|
|
|
|
|
|
|
|
|
Leach ore placed in stockpiles (metric tons per day)
|
|
|
|
237,000
|
|
281,700
|
|
235,300
|
|
284,200
|
|
Average copper ore grade (percent)
|
|
|
|
0.41
|
|
0.52
|
|
0.41
|
|
0.51
|
|
Copper production (millions of recoverable pounds)
|
|
|
|
109
|
|
125
|
|
223
|
|
248
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mill Operations
|
|
|
|
|
|
|
|
|
|
|
|
Ore milled (metric tons per day)
|
|
|
|
116,500
|
|
182,200
|
|
117,900
|
|
185,500
|
|
Average ore grades:
|
|
|
|
|
|
|
|
|
|
|
|
Copper (percent)
|
|
|
|
0.46
|
|
0.56
|
|
0.45
|
|
0.58
|
|
Molybdenum (percent)
|
|
|
|
0.01
|
|
0.02
|
|
0.02
|
|
0.02
|
|
Gold (grams per metric ton)
|
|
|
|
—
|
|
0.11
|
|
—
|
|
0.11
|
|
Copper recovery rate (percent)
|
|
|
|
78.2
|
|
88.7
|
|
78.9
|
|
89.4
|
|
Production (recoverable):
|
|
|
|
|
|
|
|
|
|
|
|
Copper (millions of pounds)
|
|
|
|
79
|
|
175
|
|
158
|
|
366
|
|
Molybdenum (millions of pounds)
|
|
|
|
2
|
|
2
|
|
4
|
|
5
|
|
Gold (thousands of ounces)
|
|
|
|
—
|
|
21
|
|
—
|
|
42
|
|
|
|
|
|
|
|
|
|
|
|
|
|
100% Indonesia Mining
|
|
|
|
|
|
|
|
|
|
|
|
Ore milled (metric tons per day)b
|
|
|
|
|
|
|
|
|
|
|
|
Grasberg open pit
|
|
|
|
134,200
|
|
50,700
|
|
121,200
|
|
58,200
|
|
DOZ underground mine
|
|
|
|
42,700
|
|
50,500
|
|
45,800
|
|
50,400
|
|
Big Gossan underground mine
|
|
|
|
—
|
|
1,700
|
|
—
|
|
1,800
|
|
Total
|
|
|
|
176,900
|
|
102,900
|
|
167,000
|
|
110,400
|
|
Average ore grades:
|
|
|
|
|
|
|
|
|
|
|
|
Copper (percent)
|
|
|
|
0.67
|
|
0.73
|
|
0.63
|
|
0.72
|
|
Gold (grams per metric ton)
|
|
|
|
0.86
|
|
0.65
|
|
0.78
|
|
0.72
|
|
Recovery rates (percent):
|
|
|
|
|
|
|
|
|
|
|
|
Copper
|
|
|
|
90.6
|
|
89.0
|
|
90.6
|
|
88.7
|
|
Gold
|
|
|
|
83.5
|
|
76.3
|
|
83.9
|
|
78.1
|
|
Production (recoverable):
|
|
|
|
|
|
|
|
|
|
|
|
Copper (millions of pounds)
|
|
|
|
205
|
|
125
|
|
359
|
|
269
|
|
Gold (thousands of ounces)
|
|
|
|
360
|
|
142
|
|
615
|
|
351
|
|
|
|
|
|
|
|
|
|
|
|
|
|
100% Africa Mining
|
|
|
|
|
|
|
|
|
|
|
|
Ore milled (metric tons per day)
|
|
|
|
15,300
|
|
15,200
|
|
14,900
|
|
14,800
|
|
Average ore grades (percent):
|
|
|
|
|
|
|
|
|
|
|
|
Copper
|
|
|
|
4.02
|
|
4.08
|
|
4.18
|
|
4.07
|
|
Cobalt
|
|
|
|
0.44
|
|
0.34
|
|
0.40
|
|
0.33
|
|
Copper recovery rate (percent)
|
|
|
|
93.9
|
|
92.7
|
|
93.9
|
|
93.7
|
|
Production (millions of pounds):
|
|
|
|
|
|
|
|
|
|
|
|
Copper (recoverable)
|
|
|
|
115
|
|
114
|
|
231
|
|
223
|
|
Cobalt (contained)
|
|
|
|
9
|
|
7
|
|
16
|
|
14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
100% Molybdenum Mines
|
|
|
|
|
|
|
|
|
|
|
|
Ore milled (metric tons per day)
|
|
|
|
35,900
|
|
44,800
|
|
38,200
|
|
42,200
|
|
Average molybdenum ore grade (percent)
|
|
|
|
0.20
|
|
0.18
|
|
0.19
|
|
0.18
|
|
Molybdenum production (millions of recoverable pounds)
|
|
|
|
13
|
|
14
|
|
26
|
|
27
|
|
|
|
|
|
|
|
|
|
|
|
|
|
a. On November 3, 2014, FCX completed the sale of its 80
percent interests in the Candelaria and Ojos del Salado mines.
|
|
b. Amounts represent the approximate average daily
throughput processed at PT-FI's mill facilities from each
producing mine.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FREEPORT-McMoRan INC.
|
|
SELECTED U.S. OIL AND GAS OPERATING DATA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
|
|
|
|
|
|
Sales Volumes
|
|
|
|
Sales per Day
|
|
|
|
|
|
|
|
2015
|
|
|
|
2014
|
|
|
|
2015
|
|
|
|
2014
|
|
|
|
Gulf of Mexico (GOM)a
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil (thousand barrels or MBbls)
|
|
|
|
|
5,234
|
|
|
|
|
5,262
|
|
|
|
58
|
|
|
|
58
|
|
|
|
Natural gas (million cubic feet or MMcf)
|
|
|
|
|
9,279
|
|
|
|
|
6,669
|
|
|
|
102
|
|
|
|
73
|
|
|
|
Natural gas liquids (NGLs, in MBbls)
|
|
|
|
|
529
|
|
|
|
|
489
|
|
|
|
5
|
|
|
|
5
|
|
|
|
Thousand barrels of oil equivalents (MBOE)
|
|
|
|
|
7,309
|
|
|
|
|
6,862
|
|
|
|
80
|
|
|
|
75
|
|
|
|
Average realized price per BOEb
|
|
|
|
$
|
47.82
|
|
|
|
$
|
87.49
|
|
|
|
|
|
|
|
|
|
|
|
Cash production costs per BOEb
|
|
|
|
$
|
16.98
|
|
|
|
$
|
14.80
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures (in millions)
|
|
|
|
$
|
676
|
|
c
|
|
$
|
728
|
|
c
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CALIFORNIA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil (MBbls)
|
|
|
|
|
3,326
|
|
|
|
|
3,436
|
|
|
|
37
|
|
|
|
37
|
|
|
|
Natural gas (MMcf)
|
|
|
|
|
562
|
|
|
|
|
597
|
|
|
|
6
|
|
|
|
7
|
|
|
|
NGLs (MBbls)
|
|
|
|
|
42
|
|
|
|
|
42
|
|
|
|
—
|
|
d
|
|
1
|
|
|
|
MBOE
|
|
|
|
|
3,462
|
|
|
|
|
3,578
|
|
|
|
38
|
|
|
|
39
|
|
|
|
Average realized price per BOEb
|
|
|
|
$
|
48.30
|
|
|
|
$
|
94.37
|
|
|
|
|
|
|
|
|
|
|
|
Cash production costs per BOEb
|
|
|
|
$
|
27.13
|
|
|
|
$
|
37.70
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures (in millions)
|
|
|
|
$
|
24
|
|
|
|
$
|
68
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HAYNESVILLE/MADDEN/OTHER
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil (MBbls)
|
|
|
|
|
39
|
|
|
|
|
26
|
|
|
|
—
|
|
d
|
|
—
|
|
d
|
|
Natural gas (MMcf)
|
|
|
|
|
13,693
|
|
|
|
|
9,585
|
|
|
|
151
|
|
|
|
105
|
|
|
|
NGLs (MBbls)
|
|
|
|
|
15
|
|
|
|
|
5
|
|
|
|
—
|
|
d
|
|
—
|
|
d
|
|
MBOE
|
|
|
|
|
2,336
|
|
|
|
|
1,629
|
|
|
|
26
|
|
|
|
18
|
|
|
|
Average realized price per BOEb
|
|
|
|
$
|
16.15
|
|
|
|
$
|
27.59
|
|
|
|
|
|
|
|
|
|
|
|
Cash production costs per BOEb
|
|
|
|
$
|
13.55
|
|
|
|
$
|
15.35
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures (in millions)
|
|
|
|
$
|
6
|
|
|
|
$
|
40
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EAGLE FORDe
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil (MBbls)
|
|
|
|
|
—
|
|
|
|
|
2,950
|
|
|
|
—
|
|
|
|
33
|
|
|
|
Natural gas (MMcf)
|
|
|
|
|
—
|
|
|
|
|
3,452
|
|
|
|
—
|
|
|
|
38
|
|
|
|
NGLs (MBbls)
|
|
|
|
|
—
|
|
|
|
|
433
|
|
|
|
—
|
|
|
|
5
|
|
|
|
MBOE
|
|
|
|
|
—
|
|
|
|
|
3,959
|
|
|
|
—
|
|
|
|
44
|
|
|
|
Average realized price per BOEb
|
|
|
|
$
|
—
|
|
|
|
$
|
81.52
|
|
|
|
|
|
|
|
|
|
|
|
Cash production costs per BOEb
|
|
|
|
$
|
—
|
|
|
|
$
|
13.23
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures (in millions)
|
|
|
|
$
|
—
|
|
|
|
$
|
105
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL U.S. OIL AND GAS OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil (MBbls)
|
|
|
|
|
8,599
|
|
|
|
|
11,674
|
|
|
|
95
|
|
|
|
128
|
|
|
|
Natural gas (MMcf)
|
|
|
|
|
23,534
|
|
|
|
|
20,303
|
|
|
|
259
|
|
|
|
223
|
|
|
|
NGLs (MBbls)
|
|
|
|
|
586
|
|
|
|
|
969
|
|
|
|
5
|
|
|
|
11
|
|
|
|
MBOE
|
|
|
|
|
13,107
|
|
|
|
|
16,028
|
|
|
|
144
|
|
|
|
176
|
|
|
|
Cash operating margin per BOE:b
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Realized revenues
|
|
|
|
$
|
50.04
|
|
|
|
$
|
77.53
|
|
|
|
|
|
|
|
|
|
|
|
Cash production costs
|
|
|
|
|
19.04
|
|
|
|
|
19.57
|
|
|
|
|
|
|
|
|
|
|
|
Cash operating margin
|
|
|
|
$
|
31.00
|
|
|
|
$
|
57.96
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation, depletion and amortization per BOE
|
|
|
|
$
|
36.99
|
|
|
|
$
|
38.39
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures (in millions)
|
|
|
|
$
|
777
|
|
f
|
|
$
|
903
|
|
f
|
|
|
|
|
|
|
|
|
|
|
|
a. Reflects properties in the Deepwater GOM and on
the Shelf, including the Inboard Lower Tertiary/Cretaceous natural
gas trend.
|
|
b. Cash operating margin for oil and gas operations
reflects realized revenues less cash production costs. Realized
revenues exclude noncash mark-to-market adjustments on derivative
contracts which are managed on a consolidated basis; accordingly,
the average realized price per BOE by region does not reflect
adjustments for derivative contracts. For reconciliations of
average realized price and cash production costs per BOE to
revenues and production and delivery costs reported in FCX's
consolidated financial statements, refer to the supplemental
schedules, “Product Revenues and Production Costs,” beginning on
page XIV, which is available on FCX's website, fcx.com.
|
|
c. Includes $58 million in second-quarter 2015 and
$174 million in second-quarter 2014 for the Inboard Lower
Tertiary/Cretaceous natural gas trend.
|
|
d. Rounds to less than 1 MBbl per day.
|
|
e. FCX completed the sale of its Eagle Ford shale
assets on June 20, 2014.
|
|
f. Consolidated capital expenditures for United
States (U.S.) oil and gas operations reflect total spending, which
include accrual and other adjustments totaling $71 million for
second-quarter 2015 and $(38) million for second-quarter 2014 that
are not specifically allocated to the above regions.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FREEPORT-McMoRan INC.
|
|
SELECTED OIL AND GAS OPERATING DATA (continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30,
|
|
|
|
|
|
|
|
Sales Volumes
|
|
|
|
Sales per Day
|
|
|
|
|
|
|
|
2015
|
|
|
|
2014
|
|
|
|
2015
|
|
|
|
2014
|
|
|
|
GOMa
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil (MBbls)
|
|
|
|
10,197
|
|
|
|
10,063
|
|
|
|
56
|
|
|
|
56
|
|
|
|
Natural gas (MMcf)
|
|
|
|
16,634
|
|
|
|
12,576
|
|
|
|
92
|
|
|
|
70
|
|
|
|
NGLs (MBbls)
|
|
|
|
1,001
|
|
|
|
1,004
|
|
|
|
6
|
|
|
|
6
|
|
|
|
MBOE
|
|
|
|
13,970
|
|
|
|
13,163
|
|
|
|
77
|
|
|
|
73
|
|
|
|
Average realized price per BOEb
|
|
|
|
$44.40
|
|
|
|
$87.42
|
|
|
|
|
|
|
|
|
|
|
|
Cash production costs per BOEb
|
|
|
|
$17.17
|
|
|
|
$14.62
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures (in millions)
|
|
|
|
$1,381
|
|
c
|
|
$1,131
|
|
c
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CALIFORNIA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil (MBbls)
|
|
|
|
6,700
|
|
|
|
6,855
|
|
|
|
37
|
|
|
|
38
|
|
|
|
Natural gas (MMcf)
|
|
|
|
1,146
|
|
|
|
1,145
|
|
|
|
6
|
|
|
|
6
|
|
|
|
NGLs (MBbls)
|
|
|
|
84
|
|
|
|
83
|
|
|
|
—
|
|
d
|
|
—
|
|
d
|
|
MBOE
|
|
|
|
6,975
|
|
|
|
7,129
|
|
|
|
39
|
|
|
|
39
|
|
|
|
Average realized price per BOEb
|
|
|
|
$43.49
|
|
|
|
$93.07
|
|
|
|
|
|
|
|
|
|
|
|
Cash production costs per BOEb
|
|
|
|
$29.43
|
|
|
|
$37.12
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures (in millions)
|
|
|
|
$53
|
|
|
|
$121
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HAYNESVILLE/MADDEN/OTHER
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil (MBbls)
|
|
|
|
74
|
|
|
|
54
|
|
|
|
1
|
|
|
|
—
|
|
d
|
|
Natural gas (MMcf)
|
|
|
|
27,521
|
|
|
|
18,651
|
|
|
|
152
|
|
|
|
103
|
|
|
|
NGLs (MBbls)
|
|
|
|
25
|
|
|
|
11
|
|
|
|
—
|
|
d
|
|
—
|
|
d
|
|
MBOE
|
|
|
|
4,686
|
|
|
|
3,174
|
|
|
|
26
|
|
|
|
18
|
|
|
|
Average realized price per BOEb
|
|
|
|
$16.66
|
|
|
|
$28.93
|
|
|
|
|
|
|
|
|
|
|
|
Cash production costs per BOEb
|
|
|
|
$12.42
|
|
|
|
$13.40
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures (in millions)
|
|
|
|
$27
|
|
|
|
$67
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EAGLE FORDe
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil (MBbls)
|
|
|
|
—
|
|
|
|
6,481
|
|
|
|
—
|
|
|
|
36
|
|
|
|
Natural gas (MMcf)
|
|
|
|
—
|
|
|
|
7,410
|
|
|
|
—
|
|
|
|
41
|
|
|
|
NGLs (MBbls)
|
|
|
|
—
|
|
|
|
978
|
|
|
|
—
|
|
|
|
5
|
|
|
|
MBOE
|
|
|
|
—
|
|
|
|
8,694
|
|
|
|
—
|
|
|
|
48
|
|
|
|
Average realized price per BOEb
|
|
|
|
$—
|
|
|
|
$81.66
|
|
|
|
|
|
|
|
|
|
|
|
Cash production costs per BOEb
|
|
|
|
$—
|
|
|
|
$12.97
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures (in millions)
|
|
|
|
$—
|
|
|
|
$232
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL U.S. OIL AND GAS OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil (MBbls)
|
|
|
|
16,971
|
|
|
|
23,453
|
|
|
|
94
|
|
|
|
130
|
|
|
|
Natural gas (MMcf)
|
|
|
|
45,301
|
|
|
|
39,782
|
|
|
|
250
|
|
|
|
220
|
|
|
|
NGLs (MBbls)
|
|
|
|
1,110
|
|
|
|
2,076
|
|
|
|
6
|
|
|
|
11
|
|
|
|
MBOE
|
|
|
|
25,631
|
|
|
|
32,160
|
|
|
|
142
|
|
|
|
178
|
|
|
|
Cash operating margin per BOE:b
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Realized revenue
|
|
|
|
$46.95
|
|
|
|
$77.37
|
|
|
|
|
|
|
|
|
|
|
|
Cash production costs
|
|
|
|
19.62
|
|
|
|
19.03
|
|
|
|
|
|
|
|
|
|
|
|
Cash operating margin
|
|
|
|
$27.33
|
|
|
|
$58.34
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation, depletion and amortization per BOE
|
|
|
|
$39.59
|
|
|
|
$38.30
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures (in millions)
|
|
|
|
$1,795
|
|
f
|
|
$1,484
|
|
f
|
|
|
|
|
|
|
|
|
|
|
|
a. Reflects properties in the Deepwater GOM and on
the Shelf, including the Inboard Lower Tertiary/Cretaceous natural
gas trend.
|
|
b. Cash operating margin for oil and gas operations
reflects realized revenues less cash production costs. Realized
revenues exclude noncash mark-to-market adjustments on derivative
contracts which are managed on a consolidated basis; accordingly,
the average realized price per BOE by region does not reflect
adjustments for derivative contracts. For reconciliations of
average realized price and cash production costs per BOE to
revenues and production and delivery costs reported in FCX's
consolidated financial statements, refer to the supplemental
schedules, “Product Revenues and Production Costs,” beginning on
page XIV, which is available on FCX's website, fcx.com.
|
|
c. Includes $142 million for the first six months
of 2015 and $300 million for the first six months of 2014 for the
Inboard Lower Tertiary/Cretaceous natural gas trend.
|
|
d. Rounds to less than 1 MBbl per day.
|
|
e. FCX completed the sale of its Eagle Ford shale
assets on June 20, 2014.
|
|
f. Consolidated capital expenditures for U.S. oil
and gas operations reflect total spending, which include accrual
and other adjustments totaling $334 million for the first six
months of 2015 and $(67) million for the first six months of 2014
that are not specifically allocated to the above regions.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FREEPORT-McMoRan INC.
|
|
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Six Months Ended
|
|
|
|
|
|
|
June 30,
|
|
|
June 30,
|
|
|
|
|
|
|
2015
|
|
|
2014
|
|
|
2015
|
|
|
2014
|
|
|
|
|
|
|
(In millions, except per share amounts)
|
|
|
Revenues
|
|
|
|
$
|
4,248
|
|
a,b
|
|
$
|
5,522
|
|
a,b
|
|
$
|
8,401
|
|
a,b
|
|
$
|
10,507
|
|
a,b
|
|
Cost of sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production and delivery
|
|
|
|
|
2,848
|
|
c,d
|
|
|
3,082
|
|
e
|
|
|
5,760
|
|
c,d
|
|
|
5,819
|
|
e
|
|
Depreciation, depletion and amortization
|
|
|
|
|
890
|
|
|
|
|
1,013
|
|
|
|
|
1,829
|
|
|
|
|
1,979
|
|
|
|
Impairment of oil and gas properties
|
|
|
|
|
2,686
|
|
|
|
|
—
|
|
|
|
|
5,790
|
|
|
|
|
—
|
|
|
|
Total cost of sales
|
|
|
|
|
6,424
|
|
|
|
|
4,095
|
|
|
|
|
13,379
|
|
|
|
|
7,798
|
|
|
|
Selling, general and administrative expenses
|
|
|
|
|
151
|
|
|
|
|
164
|
|
|
|
|
305
|
|
|
|
|
299
|
|
|
|
Mining exploration and research expenses
|
|
|
|
|
36
|
|
|
|
|
34
|
|
|
|
|
69
|
|
|
|
|
64
|
|
|
|
Environmental obligations and shutdown costs
|
|
|
|
|
11
|
|
|
|
|
76
|
|
|
|
|
24
|
|
|
|
|
82
|
|
|
|
Net gain on sale of assets
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
(39
|
)
|
|
|
|
—
|
|
|
|
Total costs and expenses
|
|
|
|
|
6,622
|
|
|
|
|
4,369
|
|
|
|
|
13,738
|
|
|
|
|
8,243
|
|
|
|
Operating (loss) income
|
|
|
|
|
(2,374
|
)
|
|
|
|
1,153
|
|
|
|
|
(5,337
|
)
|
|
|
|
2,264
|
|
|
|
Interest expense, net
|
|
|
|
|
(149
|
)
|
f
|
|
|
(164
|
)
|
f
|
|
|
(295
|
)
|
f
|
|
|
(325
|
)
|
f
|
|
Insurance and other third-party recoveries
|
|
|
|
|
92
|
|
|
|
|
—
|
|
|
|
|
92
|
|
|
|
|
—
|
|
|
|
Net gain on early extinguishment of debt
|
|
|
|
|
—
|
|
|
|
|
5
|
|
|
|
|
—
|
|
|
|
|
5
|
|
|
|
Other (expense) income, net
|
|
|
|
|
(55
|
)
|
|
|
|
(8
|
)
|
|
|
|
(48
|
)
|
|
|
|
25
|
|
|
|
(Loss) income before income taxes and equity in affiliated
companies' net earnings
|
|
|
|
|
(2,486
|
)
|
|
|
|
986
|
|
|
|
|
(5,588
|
)
|
|
|
|
1,969
|
|
|
|
Benefit from (provision for) income taxes
|
|
|
|
|
687
|
|
g
|
|
|
(328
|
)
|
g
|
|
|
1,382
|
|
g
|
|
|
(685
|
)
|
g
|
|
Equity in affiliated companies' net earnings
|
|
|
|
|
—
|
|
|
|
|
2
|
|
|
|
|
1
|
|
|
|
|
2
|
|
|
|
Net (loss) income
|
|
|
|
|
(1,799
|
)
|
|
|
|
660
|
|
|
|
|
(4,205
|
)
|
|
|
|
1,286
|
|
|
|
Net income attributable to noncontrolling interests
|
|
|
|
|
(42
|
)
|
|
|
|
(168
|
)
|
|
|
|
(100
|
)
|
|
|
|
(274
|
)
|
|
|
Preferred dividends attributable to redeemable noncontrolling
interest
|
|
|
|
|
(10
|
)
|
|
|
|
(10
|
)
|
|
|
|
(20
|
)
|
|
|
|
(20
|
)
|
|
|
Net (loss) income attributable to common stockholders
|
|
|
|
$
|
(1,851
|
)
|
h
|
|
$
|
482
|
|
h
|
|
$
|
(4,325
|
)
|
h
|
|
$
|
992
|
|
h
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income per share attributable to common stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
$
|
(1.78
|
)
|
|
|
$
|
0.46
|
|
|
|
$
|
(4.16
|
)
|
|
|
$
|
0.95
|
|
|
|
Diluted
|
|
|
|
$
|
(1.78
|
)
|
|
|
$
|
0.46
|
|
|
|
$
|
(4.16
|
)
|
|
|
$
|
0.95
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
1,040
|
|
|
|
|
1,039
|
|
|
|
|
1,040
|
|
|
|
|
1,039
|
|
|
|
Diluted
|
|
|
|
|
1,040
|
|
|
|
|
1,045
|
|
|
|
|
1,040
|
|
|
|
|
1,045
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends declared per share of common stock
|
|
|
|
$
|
0.1605
|
|
|
|
$
|
0.3125
|
|
|
|
$
|
0.2105
|
|
|
|
$
|
0.6250
|
|
|
|
|
|
a. Includes (unfavorable) favorable adjustments to
provisionally priced concentrate and cathode copper sales
recognized in prior periods totaling $(20) million ($(10) million
to net loss attributable to common stock) for second-quarter 2015,
$35 million ($16 million to net income attributable to common
stock) for second-quarter 2014, $(106) million ($(50) million to
net loss attributable to common stock) for the first six months of
2015 and $(118) million ($(65) million to net income attributable
to common stock) for the first six months of 2014. For further
discussion, refer to the supplemental schedule, "Derivative
Instruments," beginning on page X.
|
|
b. Includes net noncash mark-to-market (losses)
gains associated with crude oil and natural gas derivative
contracts totaling $(95) million ($(59) million to net loss
attributable to common stock) for second-quarter 2015, $(7)
million ($(4) million to net income attributable to common stock)
for second-quarter 2014, $(143) million ($(89) million to net loss
attributable to common stock) for the first six months of 2015 and
$8 million ($5 million to net income attributable to common stock)
for the first six months of 2014. For further discussion, refer to
the supplemental schedule, "Derivative Instruments," beginning on
page X.
|
|
c. Includes charges totaling $59 million ($38
million to net loss attributable to common stock) for
second-quarter 2015 and $63 million ($41 million to net loss
attributable to common stock) for the first six months of 2015 for
lower of cost or market (LCM) adjustments primarily attributable
to molybdenum inventories.
|
|
d. Includes net charges of $22 million ($14 million
to net loss attributable to common stock) for second-quarter 2015
and $39 million ($24 million to net loss attributable to common
stock) for the first six months of 2015 for idle/terminated rig
costs and inventory write-downs at oil and gas operations.
|
|
e. Includes $56 million ($30 million to net income
attributable to common stock) for second-quarter 2014 and $109
million ($58 million to net income attributable to common stock)
for the first six months of 2014 for fixed costs charged directly
to cost of sales as a result of the impact of export restrictions
on PT Freeport Indonesia's (PT-FI) operating rates.
|
|
f. Consolidated interest expense, excluding
capitalized interest, totaled $215 million in second-quarter 2015,
$225 million in second-quarter 2014, $425 million for the first
six months of 2015 and $449 million for the first six months of
2014.
|
|
g. As a result of the impairment to oil and gas
properties, FCX recorded tax charges of $305 million for
second-quarter 2015 and $763 million for the first six months of
2015 to establish a valuation allowance primarily against U.S.
federal alternative minimum tax credits. The second-quarter and
first six months of 2014 include a charge of $58 million related
to deferred taxes recorded in connection with the allocation of
goodwill to the sale of Eagle Ford. For a summary of the benefit
from (provision for) income taxes, refer to the supplementary
schedule, "Income Taxes," on page IX.
|
|
h. FCX defers recognizing profits on intercompany
sales until final sales to third parties occur. Changes in these
deferrals attributable to variability in intercompany volumes
resulted in net additions to net income attributable to common
stock of $13 million in second-quarter 2015, $41 million in
second-quarter 2014, $37 million for the first six months of 2015
and $56 million for the first six months of 2014. For further
discussion, refer to the supplemental schedule, "Deferred
Profits," on page XI.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FREEPORT-McMoRan INC.
|
|
CONSOLIDATED BALANCE SHEETS (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
|
|
|
December 31,
|
|
|
|
|
|
2015
|
|
|
2014
|
|
|
|
|
|
(In millions)
|
|
ASSETS
|
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
$
|
466
|
|
|
|
$
|
464
|
|
|
Trade accounts receivable
|
|
|
|
|
949
|
|
|
|
|
953
|
|
|
Other accounts receivables
|
|
|
|
|
1,323
|
|
|
|
|
1,610
|
|
|
Inventories:
|
|
|
|
|
|
|
|
|
Materials and supplies, net
|
|
|
|
|
2,014
|
|
|
|
|
1,886
|
|
|
Mill and leach stockpiles
|
|
|
|
|
1,933
|
|
|
|
|
1,914
|
|
|
Product
|
|
|
|
|
1,484
|
|
|
|
|
1,561
|
|
|
Other current assets
|
|
|
|
|
528
|
|
|
|
|
657
|
|
|
Total current assets
|
|
|
|
|
8,697
|
|
|
|
|
9,045
|
|
|
Property, plant, equipment and mining development costs, net
|
|
|
|
|
27,095
|
|
|
|
|
26,220
|
|
|
Oil and gas properties, net - full cost method:
|
|
|
|
|
|
|
|
|
Subject to amortization, less accumulated amortization
|
|
|
|
|
4,649
|
|
|
|
|
9,187
|
|
|
Not subject to amortization
|
|
|
|
|
9,312
|
|
|
|
|
10,087
|
|
|
Long-term mill and leach stockpiles
|
|
|
|
|
2,277
|
|
|
|
|
2,179
|
|
|
Other assets
|
|
|
|
|
1,978
|
|
|
|
|
1,956
|
|
|
Total assets
|
|
|
|
$
|
54,008
|
|
|
|
$
|
58,674
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
|
Accounts payable and accrued liabilities
|
|
|
|
$
|
3,376
|
|
|
|
$
|
3,653
|
|
|
Current portion of debt
|
|
|
|
|
791
|
|
|
|
|
478
|
|
|
Current portion of environmental and asset retirement obligations
|
|
|
|
|
330
|
|
|
|
|
296
|
|
|
Dividends payable
|
|
|
|
|
175
|
|
|
|
|
335
|
|
|
Accrued income taxes
|
|
|
|
|
67
|
|
|
|
|
410
|
|
|
Total current liabilities
|
|
|
|
|
4,739
|
|
|
|
|
5,172
|
|
|
Long-term debt, less current portion
|
|
|
|
|
20,111
|
|
|
|
|
18,371
|
|
|
Deferred income taxes
|
|
|
|
|
4,870
|
|
|
|
|
6,398
|
|
|
Environmental and asset retirement obligations, less current portion
|
|
|
|
|
3,716
|
|
|
|
|
3,647
|
|
|
Other liabilities
|
|
|
|
|
1,760
|
|
|
|
|
1,861
|
|
|
Total liabilities
|
|
|
|
|
35,196
|
|
|
|
|
35,449
|
|
|
|
|
|
|
|
|
|
|
|
Redeemable noncontrolling interest
|
|
|
|
|
757
|
|
|
|
|
751
|
|
|
|
|
|
|
|
|
|
|
|
Equity:
|
|
|
|
|
|
|
|
|
Stockholders' equity:
|
|
|
|
|
|
|
|
|
Common stock
|
|
|
|
|
117
|
|
|
|
|
117
|
|
|
Capital in excess of par value
|
|
|
|
|
22,330
|
|
|
|
|
22,281
|
|
|
(Accumulated deficit) retained earnings
|
|
|
|
|
(4,417
|
)
|
|
|
|
128
|
|
|
Accumulated other comprehensive loss
|
|
|
|
|
(523
|
)
|
|
|
|
(544
|
)
|
|
Common stock held in treasury
|
|
|
|
|
(3,702
|
)
|
|
|
|
(3,695
|
)
|
|
Total stockholders' equity
|
|
|
|
|
13,805
|
|
|
|
|
18,287
|
|
|
Noncontrolling interests
|
|
|
|
|
4,250
|
|
|
|
|
4,187
|
|
|
Total equity
|
|
|
|
|
18,055
|
|
|
|
|
22,474
|
|
|
Total liabilities and equity
|
|
|
|
$
|
54,008
|
|
|
|
$
|
58,674
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FREEPORT-McMoRan INC.
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
|
|
|
|
|
|
June 30,
|
|
|
|
|
|
2015
|
|
|
2014
|
|
|
|
|
|
(In millions)
|
|
Cash flow from operating activities:
|
|
|
|
|
|
|
|
|
Net (loss) income
|
|
|
|
$
|
(4,205
|
)
|
|
|
$
|
1,286
|
|
|
Adjustments to reconcile net (loss) income to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
|
Depreciation, depletion and amortization
|
|
|
|
|
1,829
|
|
|
|
|
1,979
|
|
|
Impairment of oil and gas properties
|
|
|
|
|
5,790
|
|
|
|
|
—
|
|
|
LCM inventory adjustments
|
|
|
|
|
63
|
|
|
|
|
—
|
|
|
Net gain on sale of assets
|
|
|
|
|
(39
|
)
|
|
|
|
—
|
|
|
Net (gains) losses on crude oil and natural gas derivative contracts
|
|
|
|
|
(58
|
)
|
|
|
|
120
|
|
|
Net charges for environmental and asset retirement obligations,
including accretion
|
|
|
|
|
109
|
|
|
|
|
97
|
|
|
Payments for environmental and asset retirement obligations
|
|
|
|
|
(81
|
)
|
|
|
|
(96
|
)
|
|
Net gain on early extinguishment of debt
|
|
|
|
|
—
|
|
|
|
|
(5
|
)
|
|
Deferred income taxes
|
|
|
|
|
(1,432
|
)
|
|
|
|
37
|
|
|
Increase in long-term mill and leach stockpiles
|
|
|
|
|
(104
|
)
|
|
|
|
(131
|
)
|
|
Other, net
|
|
|
|
|
104
|
|
|
|
|
77
|
|
|
Changes in working capital and other tax payments, excluding amounts
from acquisitions and dispositions:
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
|
|
|
493
|
|
|
|
|
(243
|
)
|
|
Inventories
|
|
|
|
|
8
|
|
|
|
|
(230
|
)
|
|
Other current assets
|
|
|
|
|
(1
|
)
|
|
|
|
35
|
|
|
Accounts payable and accrued liabilities
|
|
|
|
|
(205
|
)
|
|
|
|
(186
|
)
|
|
Accrued income taxes and changes in other tax payments
|
|
|
|
|
(485
|
)
|
|
|
|
(153
|
)
|
|
Net cash provided by operating activities
|
|
|
|
|
1,786
|
|
|
|
|
2,587
|
|
|
|
|
|
|
|
|
|
|
|
Cash flow from investing activities:
|
|
|
|
|
|
|
|
|
Capital expenditures:
|
|
|
|
|
|
|
|
|
North America copper mines
|
|
|
|
|
(214
|
)
|
|
|
|
(627
|
)
|
|
South America
|
|
|
|
|
(902
|
)
|
|
|
|
(839
|
)
|
|
Indonesia
|
|
|
|
|
(438
|
)
|
|
|
|
(479
|
)
|
|
Africa
|
|
|
|
|
(97
|
)
|
|
|
|
(60
|
)
|
|
Molybdenum mines
|
|
|
|
|
(7
|
)
|
|
|
|
(33
|
)
|
|
U.S. oil and gas operations
|
|
|
|
|
(1,795
|
)
|
|
|
|
(1,484
|
)
|
|
Other
|
|
|
|
|
(75
|
)
|
|
|
|
(40
|
)
|
|
Acquisition of Deepwater Gulf of Mexico interests
|
|
|
|
|
—
|
|
|
|
|
(925
|
)
|
|
Net proceeds from sale of Eagle Ford shale assets
|
|
|
|
|
—
|
|
|
|
|
3,009
|
|
|
Other, net
|
|
|
|
|
136
|
|
|
|
|
(363
|
)
|
|
Net cash used in investing activities
|
|
|
|
|
(3,392
|
)
|
|
|
|
(1,841
|
)
|
|
|
|
|
|
|
|
|
|
|
Cash flow from financing activities:
|
|
|
|
|
|
|
|
|
Proceeds from debt
|
|
|
|
|
4,422
|
|
|
|
|
1,248
|
|
|
Repayments of debt
|
|
|
|
|
(2,360
|
)
|
|
|
|
(1,611
|
)
|
|
Cash dividends and distributions paid:
|
|
|
|
|
|
|
|
|
Common stock
|
|
|
|
|
(380
|
)
|
|
|
|
(653
|
)
|
|
Noncontrolling interests
|
|
|
|
|
(60
|
)
|
|
|
|
(250
|
)
|
|
Stock-based awards net (payments) proceeds, including excess tax
benefit
|
|
|
|
|
(7
|
)
|
|
|
|
3
|
|
|
Debt financing costs and other, net
|
|
|
|
|
(7
|
)
|
|
|
|
(10
|
)
|
|
Net cash provided by (used in) financing activities
|
|
|
|
|
1,608
|
|
|
|
|
(1,273
|
)
|
|
|
|
|
|
|
|
|
|
|
Net increase (decrease) in cash and cash equivalents
|
|
|
|
|
2
|
|
|
|
|
(527
|
)
|
|
Cash and cash equivalents at beginning of year
|
|
|
|
|
464
|
|
|
|
|
1,985
|
|
|
Cash and cash equivalents at end of period
|
|
|
|
$
|
466
|
|
|
|
$
|
1,458
|
|
|
|
|
|
|
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20150723005623/en/
Source: Freeport-McMoRan Inc.