2024 ANNUAL REPORT
P O W E R I N G P R O G R E S S
Freeport-McMoRan Inc. (FCX or Freeport) is a leading international metals company with the objective of
being foremost in copper. Headquartered in Phoenix, Arizona, FCX operates large, long-lived, geographically
diverse assets with significant proven and probable mineral reserves of copper, gold and molybdenum. FCX’s
portfolio of assets includes the Grasberg minerals district in Indonesia, one of the world’s largest copper and
gold deposits; and significant operations in North America and South America, including the large-scale
Morenci minerals district in Arizona and the Cerro Verde operation in Peru.
FCX has a strong commitment to safety performance, environmental management and the communities
where it operates. As a founding member of the International Council on Mining and Metals (ICMM), FCX
is committed to implementing ICMM’s Mining Principles, which serve as a best practice framework on
sustainable development for the global mining and metals industry. FCX has also achieved the Copper
Mark, a comprehensive assurance framework designed to demonstrate the copper industry’s responsible
production practices, at all of its copper-producing sites globally.
By supplying responsibly produced copper, FCX is proud to be a positive contributor to the world well beyond
its operational boundaries. Additional information about FCX is available at fcx.com.
NET INCOME
PER SHARE
$1.30
CAPITAL EXPENDITURES
$3.6
BILLION
Excluding PTFI’s new downstream
processing facilities
BILLION
REVENUES
$25.5
OPERATING CASH FLOWS
$7.2
BILLION
2 0 2 4 F I N A N C I A L H I G H L I G H T S
COMMON STOCK DIVIDENDS
PER SHARE
$0.60
$1.1
BILLION
NET DEBT*
Excluding debt for PTFI’s new downstream
processing facilities
* Note: Refer to non-GAAP disclosure on page 58.
4
Powering Progress
6
Letter to Shareholders
8
Operational Overview
16
Mineral Reserves and Mineral Resources
18
Financial Performance
20
Sustainability
22
Board of Directors and Leadership
23
Financial and Operating Information
106 Performance Graph
107 Stockholder Information
T A B L E O F C O N T E N T S
T A B L E O F C O N T E N T S
2024 Annual Report
1
As a leading global copper company, Freeport is
committed to the objective of being foremost in copper
and our global team is “Powering Progress” by providing
copper reliably and responsibly to a growing market.
PT Freeport Indonesia (PTFI) has deployed six new shallow-draft vessels designed to more efficiently transport copper
concentrate from the Grasberg minerals district to its two affiliated smelters in Indonesia. These new vessels are expected to
streamline concentrate delivery to downstream operations for years to come.
MORENCI, ARIZONA
BAGDAD, ARIZONA
SAFFORD/LONE STAR, ARIZONA
SIERRITA, ARIZONA
MIAMI, ARIZONA
GOLD (AU)
COPPER (CU)
MOLYBDENUM (MO)
UPSTREAM
DOWNSTREAM
G L O B A L F O O T P R I N T
EL ABRA, CHILE
HUELVA, SPAIN
Mine, Copper Rod Plant and Smelter
Atlantic Copper Smelter
CERRO VERDE, PERU
Fully Integrated Metals Producer with
Geographically Diverse Operations
D
STOWMARKET, UNITED KINGDOM
Molybdenum Processing
D
FORT MADISON, IOWA
Molybdenum Processing
D
D
Copper Refinery and Rod Mills
EL PASO, TEXAS
D
U
U
U
U
U
U
U
HENDERSON, COLORADO
CLIMAX, COLORADO
U
U
CHINO, NEW MEXICO
TYRONE, NEW MEXICO
U
U
U
D
2
Freeport | Powering Progress
NORTH AMERICA
NORTH AMERICA
SOUTH AMERICA
SOUTH AMERICA
INDONESIA
INDONESIA
CONSOLIDATED TOTALS
CONSOLIDATED TOTALS
Reserves
at 12/31/24
Cu
41.6 billion lbs
Cu
28.4 billion lbs
Cu
27.0 billion lbs
Cu
97.0 billion lbs
Au
0.6 million ozs
Au
22.4 million ozs
Au
23.0 million ozs
Mo 2.5 billion lbs
Mo 0.7 billion lbs
Mo 3.2 billion lbs
2024 Sales
Cu
1.3 billion lbs
Cu
1.2 billion lbs
Cu
1.6 billion lbs
Cu
4.1 billion lbs
Au
1.8 million ozs
Au
1.8 million ozs
Mo 78 million lbs*
Mo 78 million lbs
Freeport’s portfolio includes several
mines that were among the largest copper
producers in the world during 2024.
thousand metric tons
Source: Wood Mackenzie
BY MINE
2024
GRESIK, INDONESIA
Molybdenum Processing
• New Smelter and Precious Metals Refinery
• PT Smelting (Copper Smelter and Refinery)
ROTTERDAM, THE NETHERLANDS
Cerro Verde
Grasberg
D
GRASBERG MINERALS DISTRICT, INDONESIA
U
D
* Includes sales of molybdenum produced at FCX’s North America and South America copper mines. Note: lbs=pounds; ozs=ounces.
1,400
1,200
1,000
800
600
400
200
0
2024 Annual Report
3
4
Freeport | Powering Progress
For over 10,000 years, copper has shaped civilizations and enabled
us to meet the challenges of each era through technological
advancements, improving both health and quality of life.
As we move toward an increasingly connected, electrified and
decarbonized future, copper continues to be a critical metal for a
rapidly changing world.
It’s versatile.
Durable.
Infinitely recyclable.
And is superior at conducting electricity.
From urban development to everyday electronics and data centers,
transportation to grid infrastructure, renewable energy systems to
electric vehicles …
Copper is essential in Powering Progress
P O W E R I N G P R O G R E S S
Copper’s Transformative Role in Human Progress
Cannot be Overstated.
Nearly 70% of the world’s copper is used in
applications that deliver electricity*
* Source: International Copper Association
2024 Annual Report
5
The theme of this year’s annual report, “Powering Progress,”
highlights copper’s increasingly important role in the global
economy. As a leading global copper company, Freeport is
strongly positioned to provide copper to a growing market.
In 2024, Freeport achieved strong operational and financial
results. We met our annual copper sales guidance, and unit
net cash costs slightly exceeded our guidance at the start
of the year. Financially, our revenues, adjusted EBITDA and
operating cash flows exceeded 2023 levels, benefiting from
strong copper and gold prices. Importantly, we advanced
several value-driven initiatives to drive improved operational
performance and future growth.
At Grasberg in Indonesia, our team achieved multiple new
operating records and completed construction of the new
smelter and precious metals refinery. The Cerro Verde team
overcame operating challenges experienced early in the
year, and our team in the United States (U.S.) demonstrated
progress toward achieving greater efficiencies and cost
performance objectives. Our innovative leach initiative
provided approximately 50% more incremental copper than
in 2023, and we have commenced several new projects aimed
to increase scale further under this initiative in the near-term.
A fire in a gas cleaning facility at our new smelter in Gresik,
Indonesia, was a setback that tested our team’s resilience.
Our team responded quickly to develop plans for the
required repairs. The recovery is progressing well and we
are confident in achieving a safe and efficient ramp-up
during 2025.
Global demand for copper grew again in 2024. Because
of its superior conductivity, copper is the metal of choice
when it comes to electrification. New, massive investments
in the power grid, renewable energy generation, technology/
AI infrastructure and transportation are driving increased
demand for copper, with forecasts predicting above-
trend growth for the foreseeable future. In the near-term,
macroeconomic factors including fluctuations in the U.S.
dollar, tariff impacts and trade uncertainties, and slower-than-
expected growth in China have resulted in price volatility.
To benefit from these long-term secular trends, we are
advancing initiatives designed to build value from organic
growth opportunities. Freeport benefits from a large reserve
and resource position with near-term, medium-term and
longer-term embedded growth options. Efforts are being
advanced to leverage innovation to improve efficiencies,
reduce costs and capital intensity, and shorten lead times for
our projects. Our high-potential innovative leach initiative is
a great example of these efforts.
We are also enhancing optionality in our brownfield growth
pipeline to position the business for long-term growth. We
commenced early works at Bagdad in Arizona to derisk the
project, we are conducting a pre-feasibility study at Lone
Star in Arizona, and we are preparing an environmental
impact statement at El Abra in Chile. Collectively, these
projects and our leach innovation initiatives in the Americas
provide us with a pipeline for future growth totaling 1.8 billion
pounds of copper per annum. In Indonesia, we continue to
invest in our underground reserves to sustain Grasberg’s
operations with ongoing development at Kucing Liar and
remain optimistic about the opportunity to extend our
mining rights in this important district to unlock additional
growth options.
Dear Fellow Shareholders
L E T T E R T O S H A R E H O L D E R S
$ in billions
$ in billions
REVENUES
$22.9
2023
2024
$25.5
2024 HIGHLIGHTS
$5.3
2023
2024
$7.2
OPERATING
CASH FLOWS
Freeport | Powering Progress
6
We ended 2024 with significant liquidity and a net debt level
in the $1 billion range, excluding debt associated with PTFI’s
new downstream processing facilities. Following strong
execution of our plans over a multi-year period and a strong
financial profile, we have now achieved investment grade
ratings from all three rating agencies.
During 2024, we were disciplined in executing our
performance-based shareholder payout framework, while
maintaining both our base and variable dividends. Since
reaching our net debt objective in mid-2021, we have
distributed nearly $5 billion through dividends and share
repurchases, which represents approximately 50% of our
excess cash flows under our established financial policy. We
also took advantage of an opportunity to repurchase shares
of Cerro Verde, increasing our ownership in this high-quality
asset to 55%.
Throughout 2024, we made significant strides in improving
several safety metrics, achieving our lowest incident rate in
over a decade. Despite these improvements, we mourn the
loss of two logistics contractors who were fatally injured.
We have an unwavering commitment to strive for continuous
improvement when it comes to the safety of our workforce.
Sustainability remains at the core of what we do. During
2024, we advanced our climate initiatives to support our
commitments in this important area and maintained the
Copper Mark and Molybdenum Mark, as applicable, at all of
our operations. Additionally, we are involved in industry-wide
efforts aimed at enhancing the industry’s image.
We entered 2025 with a clear focus on continued strong
execution of our operating plans, enhancing productivity,
managing costs and capital, and advancing opportunities
for long-term profitable growth. We are confident in our
strategic direction focused on copper and remain committed
to delivering value to our shareholders.
To our global workforce, thank you for your contributions
day in and day out. And to our Board of Directors, thank you
for your advice and counsel. Together, we are “Powering
Progress” by supplying copper to a growing market.
We appreciate your investment in our company.
KATHLEEN L. QUIRK
President and
Chief Executive Officer
March 31, 2025
RICHARD C. ADKERSON
Chairman of the Board
WORLD’S TOP COPPER
PRODUCERS 2024
Source: Wood Mackenzie production ranking on an attributable
basis. On a 100% basis, Freeport, as operator, mined
approximately 8.5% of the world’s copper in 2024.
BY COMPANY
thousand metric tons
Freeport
1,200
1,400
1,600
1,000
800
600
400
200
0
2024 Annual Report
7
Consolidated Operating Results
Consolidated Operating Results
FCX’s global team delivered solid results in 2024, reflecting strong
execution of its operating plans. FCX’s consolidated copper sales
volumes totaled 4.1 billion pounds in 2024 and 2023. Consolidated gold
sales volumes of 1.8 million ounces in 2024 were higher than 1.7 million
ounces in 2023, primarily reflecting the timing of shipments at FCX’s
subsidiary, PTFI.
Looking to the future, FCX is focused on enhancing productivity,
managing costs and capital and on initiatives to build value from
profitable organic growth. FCX benefits from a large mineral reserve
and resource position with near-term, medium-term and longer-term
embedded growth options. Innovation is a major priority as we move
forward to improve efficiencies, reduce costs and capital intensity and
shorten lead times for our projects. Our high-potential innovative leach
initiative is a great example. In 2024, we achieved an approximate 50%
increase in copper production from this initiative and have projects
in motion to target an annual run rate of 300 million pounds per
annum by the end of 2025, 40% higher than we achieved in 2024, with
opportunities for further gains in the future. We are also advancing our
brownfield expansion opportunities at Bagdad, Lone Star and El Abra
to position the company for long-term growth to supply a market with
increased requirements for copper.
FCX believes it is well positioned for the future with high-quality, large-
scale copper assets, attractive organic growth options, a successful
team track record and a strong balance sheet.
O P E R A T I O N A L O V E R V I E W
Consolidated copper sales
BILLION POUNDS
4.1
Average realized copper price
PER POUND
$4.21
Consolidated gold sales
MILLION OUNCES
1.8
Average realized gold price
PER OUNCE
$2,418
2024 HIGHLIGHTS
AMERICAS LEACH INNOVATION INITIATIVES
LOW COST, HIGH VALUE
SCALING THE OPPORTUNITY
million pounds
LONG-TERM PRODUCTION TARGET
~800 million pounds/annum
800
300–400
214
144
50
25%
PHASE 2 IN PROGRESS
Scaling
25%
PHASE 1 COMPLETE
Proving Concept
50%
PHASE 3 BY 2030
Innovation in Progress
Copper production
achieved
Estimated copper
production
2030
2026
2024
2023
2022
8
Freeport | Powering Progress
Converting Bagdad’s truck fleet to a fully autonomous haulage system represents
an industry first in the U.S. Unlike remotely operated vehicles, these driverless
trucks are fully programmed to function independently. The entire mine fleet at
Bagdad is expected to be autonomous by year-end 2025.
2024 was a year of strong operational and financial performance for Freeport.
Copper production of 4.2 billion pounds was similar to 2023.
2024 Annual Report
9
In the U.S., Freeport is the leading producer of copper with a long-standing
franchise dating back to the late 1800s. To offset declining grades, we
are challenging ourselves to leverage innovation to improve efficiencies,
are challenging ourselves to leverage innovation to improve efficiencies,
reduce costs and capital intensity and shorten lead times for our projects.
reduce costs and capital intensity and shorten lead times for our projects.
10
10
Freeport | Powering Progress
Freeport | Powering Progress
North America Operations
FCX U.S. MARKET SHARE FOR COPPER*
O P E R A T I O N A L O V E R V I E W
FCX is a major integrated copper producer in North
America, supplying approximately 35% of the U.S.’ 2024
copper demand, based on data from Wood Mackenzie.
The majority of the copper produced at FCX’s North
America copper mines is processed at our Miami smelter
in Arizona and our El Paso refinery and rod mills in Texas.
These products are sold in the form of continuous cast
copper rod, with the remainder sold in the form of copper
cathode or copper concentrate.
FCX manages seven open-pit copper mines in North
America — Morenci, Bagdad, Safford (including Lone Star),
Sierrita and Miami in Arizona, and Chino and Tyrone in
New Mexico; and two molybdenum mines — Henderson
and Climax in Colorado. Total copper production from
these mines represented nearly 60% of the U.S. copper
production in 2024. Morenci, our largest mine in the
U.S., produces more copper than any copper mine in
North America and ranked among the world’s top fifteen
producing copper mines in 2024.
North America’s consolidated copper sales totaled
1.3 billion pounds in 2024 and 1.4 billion pounds in 2023.
Copper sales from our North America copper mines are
generally based on prevailing COMEX monthly average
copper settlement prices.
For the year 2024, COMEX copper settlement prices
averaged $4.22 per pound (ranging from a low of $3.69
per pound to a high of $5.12 per pound) and closed at
$3.99 per pound on December 31, 2024. Molybdenum
concentrate, gold and silver are also produced by certain
of FCX’s North America copper mines.
FCX has substantial mineral reserves and future
opportunities in the U.S., primarily associated with existing
mining operations. FCX has a potential expansion project
to more than double the concentrator capacity of the
Bagdad operation. FCX is currently converting Bagdad’s
existing haul truck fleet to autonomous to support its
long-range plans. In parallel, FCX is enhancing local
infrastructure projects required under long-range plans
in order to advance the potential construction timeline.
FCX has commenced pre-feasibility studies in the Lone
Star district of Safford to define a potential significant
expansion opportunity. Positive drilling conducted in
recent years indicates a large mineralized district, and
FCX expects to complete its pre-feasibility studies in 2026.
Fully Integrated U.S. Producer
Through its mines and downstream
facilities, Freeport employs over 39,000
workers in the U.S. (including 25,000
contractors). Freeport has made
investments totaling more than $10 billion
in the U.S. over the last several years and
has potential future copper investment
opportunities in Arizona of over $10 billion.
MINE PRODUCTION
MINE PRODUCTION
~1.1 million metric tons
58%
FCX
Other
producers
Other
producers
TOTAL REFINED PRODUCTION
TOTAL REFINED PRODUCTION
~0.9 million metric tons
~70%
FCX
* Source: Wood Mackenzie
2024 Annual Report
11
11
FCX manages two copper mines in South America — Cerro Verde in
Peru and El Abra in Chile. Consolidated sales from these mines totaled
1.2 billion pounds in 2024 and 2023, and copper production from the
Cerro Verde mine ranked among the world’s top ten largest copper
producing mines in 2024. In addition to copper, the Cerro Verde mine
produces molybdenum concentrate and silver.
Copper production from FCX’s South America operations is sold as
copper concentrate or copper cathode. During 2024, FCX’s South
America operations sold 74% of their copper production in concentrate
and 26% as copper cathode.
At the El Abra operations in Chile, FCX has completed substantial
drilling and evaluations to define a large sulfide resource that we
believe would support a potential major mill project similar to the large-
scale concentrator at Cerro Verde. Proceeding with the project could
potentially add incremental FCX consolidated recoverable reserves
totaling approximately 20 billion pounds of copper. The decision of
whether to proceed and timing of the potential project will take into
account overall copper market conditions, required permitting and
other factors.
South America Operations
South America Operations
Atlantic Copper
Our wholly owned Atlantic Copper smelter and
refinery is located in Huelva, Spain. Atlantic
Copper smelts and refines copper concentrate
and markets refined copper and precious
metals in slimes. Atlantic Copper is developing
an e-material recycling project as a result
of the significant and continued growth in
electronic waste material.
1.2
BILLION LBS
2024 consolidated copper sales
28.4
BILLION LBS
Estimated recoverable proven and probable copper
mineral reserves as of December 31, 2024
29%
FCX COPPER RESERVES
IN SOUTH AMERICA
O P E R A T I O N A L O V E R V I E W
2024 HIGHLIGHTS
12
Freeport | Powering Progress
At El Abra in Chile, FCX is preparing data for an environmental impact
statement for a project we believe has potential to add 750 million
pounds of annual copper production.
2024 Annual Report
13
14
Freeport | Powering Progress
PTFI delivered strong volumes of both
copper and gold from its large-scale
underground ore bodies and achieved
multiple operating records in 2024.
The team also successfully completed a
$500 million capital project to install a
copper cleaner circuit (pictured here
at left) to enhance mill performance.
Indonesia Operations
Through its subsidiary, PTFI, FCX operates one of the world’s largest
copper and gold mines at the Grasberg minerals district in Central
Papua, Indonesia. In the Grasberg minerals district, PTFI produces
copper concentrate that contains significant quantities of gold and
silver. In 2024, Grasberg’s copper production ranked second in the
world, and revenues from gold and silver more than offset the operating
costs of the mine.
PTFI currently has three underground operating mines in the Grasberg
minerals district: Grasberg Block Cave, Deep Mill Level Zone (DMLZ)
and Big Gossan. Long-term mine development activities for PTFI’s
Kucing Liar deposit commenced in 2022 and are ongoing. Operations
at Kucing Liar are expected to begin ramp-up prior to 2030, and at
full operating rates annual production from Kucing Liar is expected to
approximate 560 million pounds of copper and 520 thousand ounces of
gold, providing PTFI with sustained long-term, large-scale and low-cost
production. PTFI is conducting additional exploration below our DMLZ
ore body and expects that an extension of our operating rights beyond
2041 will allow for additional long-term development options in this
highly attractive district.
During 2024, PTFI completed construction of its new smelter and
precious metals refinery (PMR) (collectively, PTFI’s new downstream
processing facilities). Once PTFI’s new smelter is fully operational, all
of Grasberg’s copper concentrate is expected to be processed within
Indonesia by either PT Smelting (PTFI’s 66%-owned copper smelter
and refinery in Indonesia) or the new smelter and PMR, and PTFI will be
a fully integrated domestic producer of refined copper and gold.
PTFI’s consolidated sales totaled 1.6 billion pounds of copper and
1.8 million ounces of gold in 2024, and 1.5 billion pounds of copper
and 1.7 million ounces of gold in 2023.
O P E R A T I O N A L O V E R V I E W
* Costs (Credits) are shown net of revenues
from gold, silver and other by-products.
Refer to non-GAAP disclosure on page 58.
2024 HIGHLIGHTS
millions of ounces
GOLD PRODUCTION
23
2.0
24
1.9
22
1.8
21
1.4
20
0.8
billions of pounds
COPPER PRODUCTION
1.7
23
1.8
24
1.6
22
1.3
21
0.8
20
$ per pound of copper
UNIT NET CASH
COSTS (CREDITS)*
23
24
22
21
20
$0.43
$0.19
$0.09
$0.10
$(0.28)
2024 Annual Report
15
PTFI’s new smelter and precious metals refinery
Mineral Reserves
and Mineral Resources
ESTIMATED RECOVERABLE PROVEN AND
PROBABLE MINERAL RESERVES
97.0
BILLION LBS
Estimated recoverable proven and
probable copper mineral reserves
$3.25
PER LB
Copper price used to determine
recoverable reserves
25
YEARS
Implied reserve life for copper,
excluding mineral resources
193
BILLION LBS
Estimated incremental copper
resources on a contained basis
as of December 31, 2024
FCX has significant mineral reserves, mineral resources and future
development opportunities within its portfolio of mining assets. FCX’s
estimated consolidated recoverable proven and probable mineral
reserves from its mines at December 31, 2024, included 97.0 billion
pounds of copper, 23.0 million ounces of gold, 3.16 billion pounds of
molybdenum and 318 million ounces of silver, which were determined
using metal price assumptions of $3.25 per pound for copper, $1,600
per ounce for gold, $12 per pound for molybdenum and $20 per ounce
for silver.
In addition to the estimated consolidated recoverable proven and
probable mineral reserves, FCX’s estimated mineral resources
(including measured, indicated and inferred resources) at December 31,
2024, which were assessed using $3.75 per pound for copper, totaled
193 billion pounds of incremental contained copper. FCX continues
to pursue opportunities to convert this material into mineral reserves,
future production volumes and cash flow.
M I N E R A L R E S E R V E S A N D M I N E R A L R E S O U R C E S
LONG-LIVED
ASSET BASE
CONSOLIDATED COPPER RESERVES BY REGION
97.0 billion pounds as of December 31, 2024
28%
Indonesia
29%
South America
43%
North America
16
16
Freeport | Powering Progress
Freeport’s portfolio of long-lived, geographically diverse
copper assets has an implied reserve life of 25 years,
before considering mineral resources. With embedded
growth options and significant development expertise,
Freeport is well-positioned to pursue projects internally
to grow copper volumes over time.
2024 Annual Report
17
18
Freeport | Powering Progress
Following the strong execution of our plans over a multi-
year period and an attractive financial profile, Freeport
has now achieved investment grade ratings from all
three rating agencies.
$1.3
$1.3
BILLION
VARIABLE
DIVIDEND
$1.9
$1.9
BILLION
SHARE
REPURCHASES
$1.5
$1.5
BILLION
BASE
DIVIDEND
TOTAL
RETURNED
$4.7
$4.7
BILLION
July 1, 2021 to December 31, 2024
SHAREHOLDER RETURNS
FCX remains focused on managing costs efficiently and
continues to advance several important value-enhancing
initiatives. FCX believes the actions it has taken in recent years
to build a solid balance sheet, successfully expand low-cost
operations and maintain flexible organic growth options while
maintaining sufficient liquidity, will allow it to continue to
execute its business plans in a prudent manner during periods
of economic uncertainty while preserving future asset values.
FCX expects to maintain a strong balance sheet and liquidity
position as it focuses on building long-term value in its business,
executing its operating plans safely, responsibly and efficiently,
and prudently managing costs and capital expenditures.
OPERATING CASH FLOWS AND LIQUIDITY
FCX generated consolidated operating cash flows of $7.2 billion
in 2024. At December 31, 2024, FCX had total consolidated
debt of $8.9 billion, consolidated cash and cash equivalents
of $4.7 billion including $0.7 billion of current restricted cash
associated with a portion of PTFI’s export proceeds required
to be temporarily deposited in Indonesia banks for a period of
90 days, and no borrowings and $3.0 billion available under its
revolving credit facility. PTFI had $250 million in borrowings
outstanding under its $1.75 billion revolving credit facility and
Cerro Verde had no borrowings under its $350 million revolving
credit facility.
Based on current sales volume and costs estimates, and
assuming average prices of $4.00 per pound of copper,
$2,700 per ounce of gold and $20.00 per pound of molybdenum,
consolidated operating cash flows are estimated to approximate
$6.2 billion in 2025. The impact of copper price changes during
2025 on operating cash flows would approximate $375 million
for each $0.10 per pound change in the average price of copper.
INVESTING ACTIVITIES
FCX’s capital expenditures, including capitalized interest,
totaled $4.8 billion in 2024, including $2.1 billion for major
mining projects primarily associated with the underground
development activities in the Grasberg minerals district and
$1.2 billion for PTFI’s new downstream processing facilities.
Capital expenditures are expected to approximate $5.0 billion
in 2025 (including $2.8 billion for major mining projects and
$0.6 billion for PTFI’s new downstream processing facilities).
Projected capital expenditures for PTFI’s new downstream
processing facilities exclude capitalized interest, commissioning
and owner’s costs. Projected capital expenditures for major
mining projects include $1.1 billion for planned projects,
primarily associated with underground mine development in
the Grasberg minerals district and expansion projects in North
America, and $1.7 billion for discretionary growth projects,
primarily in the Grasberg minerals district for the development
of Kucing Liar and at the Bagdad mine for tailings infrastructure.
FINANCING TRANSACTIONS
FCX’s net debt repayments totaled $0.5 billion in 2024,
including the repayment of its 4.55% Senior Notes that
matured in November 2024 totaling $730 million, partly offset
by $250 million in borrowings under the PTFI revolving credit
facility that were used to fund capital expenditures for PTFI’s
new downstream processing facilities.
FINANCIAL POLICY
FCX’s financial policy is aligned with its strategic objectives of
maintaining a solid balance sheet, providing cash returns to
shareholders and advancing opportunities for future growth.
The policy includes a base dividend and a performance-based
payout framework, whereby up to 50% of available cash flows
generated after planned capital spending and distributions
to noncontrolling interests would be allocated to shareholder
returns and the balance to debt reduction and investments in
value-enhancing growth projects, subject to FCX maintaining
its net debt at a level not to exceed the net debt target of
$3.0 billion to $4.0 billion (excluding debt for PTFI’s new
downstream processing facilities). FCX’s Board of Directors
(Board) reviews the structure of the performance-based payout
framework at least annually.
Based on current market conditions, the base and variable
dividends on FCX’s common stock are anticipated to total
$0.60 per share for 2025 (including the dividends paid on
February 3, 2025), comprised of a $0.30 per share base dividend
and $0.30 per share variable dividend. The declaration and
payment of dividends (base or variable) is at the discretion
of the Board and will depend on FCX’s financial results, cash
requirements, global economic conditions and other factors
deemed relevant by the Board.
Financial Performance
F I N A N C I A L P E R F O R M A N C E
2024 Annual Report
19
Sustainability
Sustainability
FCX ACCOLADES
S U S T A I N A B I L I T Y
FCX is a leading responsible copper producer — supplying
approximately 8.5% of the world’s mined copper. Copper is essential
to global progress, including in the technologies necessary for
accelerating electrification. FCX recognizes the interdependencies
of growth and sustainability and the importance of managing its
environmental and social impacts. FCX is committed to meeting
growing demand for metals through our sustainability strategy,
Accelerate the Future, Responsibly.
FCX’s sustainability strategy is supported by its social and
environmental commitments which, in alignment with its business
objectives, seek to enhance responsible production practices at its sites
around the world. Fundamental to this work are the health, safety and
well-being of its workforce and host communities where it operates.
FCX seeks to work collaboratively with its stakeholders to maintain
its social license to operate, support shared value creation and to
recognize, respect and promote human rights everywhere it conducts
business. FCX is dedicated to effective environmental management
and stewardship including tailings and water, both of which are key to
ensuring the long-term viability of its business. FCX is also dedicated to
delivering the responsibly produced copper necessary to support the
global energy transition while executing on its climate strategy, which
includes managing and mitigating its greenhouse gas emissions and
other climate-related risks and impacts.
In pursuing its sustainability strategy, FCX aims to align with the highest
standards including the ICMM’s Performance Expectations and the
Copper Mark. FCX has achieved — and is committed to maintaining
— the Copper Mark and Molybdenum Mark, as applicable, at all of its
operating sites globally.
Learn more in FCX’s Annual Report
on Sustainability, available at
fcx.com/sustainability
fcx.com/sustainability.
20
Freeport | Powering Progress
2024 Annual Report
21
FCX is dedicated to responsible production practices, which includes
collaborating with local host communities on public infrastructure
projects. Cerro Verde’s wastewater treatment program supports clean
water for the city of Arequipa, the second-largest city in Peru, including
improving the water quality of the Chili River.
* Effective at the Annual Meeting of Stockholders
on June 11, 2024, Ms. Quirk will assume the
additional role of Chief Executive Officer,
succeeding Mr. Adkerson. Mr. Adkerson will
continue serving as Chairman of the Board.
EXECUTIVE OFFICERS
Richard C. Adkerson
Chairman of the Board
Kathleen L. Quirk
President and Chief Executive Officer
Douglas N. Currault II
Executive Vice President and
General Counsel
Stephen T. “Steve” Higgins
Executive Vice President and
Chief Administrative Officer
Maree E. Robertson
Executive Vice President and
Chief Financial Officer
SENIOR LEADERSHIP
Operations
Mark J. Johnson
President and Chief Operating Officer,
Freeport-McMoRan Indonesia;
Executive Vice President,
PT Freeport Indonesia
Joshua F. “Josh” Olmsted
President and Chief Operating Officer,
Freeport-McMoRan Americas
A. Cory Stevens
President, FM Technical Services
Michael J. “Mike” Kendrick
President, Climax Molybdenum Co.
Javier Targhetta
Chairman of the Board, Atlantic Copper S.L.U.
Senior Vice President (Concentrates), FCX
Clayton A. “Tony” Wenas
President Director,
PT Freeport Indonesia
Administration
Robert R. “Bob” Boyce
Vice President and Treasurer
William E. “Bill” Cobb
Vice President and
Chief Sustainability Officer
Daniel P. “Dan” Kravets
Senior Vice President and
Chief Commercial Officer
Pamela Q. “Pam” Masson
Senior Vice President and
Chief Human Resources Officer
Ellie L. Mikes
Vice President and
Chief Accounting Officer
Bertrand L. “Bert” Odinet, II
Senior Vice President and
Chief Innovation Officer
Internal Auditors
Deloitte & Touche LLP
BOARD OF DIRECTORS
Richard C. Adkerson
Chairman of the Board
Freeport-McMoRan Inc.
Dustan E. McCoy (2)
Lead Independent Director
Freeport-McMoRan Inc.
Retired Chairman and
Chief Executive Officer
Brunswick Corporation
Kathleen L. Quirk
President and Chief Executive Officer
Freeport-McMoRan Inc.
David P. Abney (2)
Retired Chairman and
Chief Executive Officer
United Parcel Service, Inc.
Marcela E. Donadio (1, 3)
Retired Partner and Americas Oil & Gas
Sector Leader
Ernst & Young LLP
Robert W. Dudley (3, 4)
Retired Group Chief Executive
BP, p.l.c.
Hugh Grant (2)
Retired Chairman of the Board,
President and Chief Executive Officer
Monsanto Company
Lydia H. Kennard (3, 4)
President and Chief Executive Officer
KDG Construction Consulting
and Quality Engineering Solutions
Ryan M. Lance (3, 4)
Chairman and Chief Executive Officer
ConocoPhillips
Sara Grootwassink Lewis (1)
Retired Chief Executive Officer
Lewis Corporate Advisors
John J. Stephens (1)
Retired Senior Executive Vice President
and Chief Financial Officer
AT&T Inc.
Frances Fragos Townsend (4)
Founder,
Frances Fragos Townsend, LLC
BOARD COMMITTEES:
(1) Audit Committee
(2) Compensation Committee
(3) Governance Committee
(4) Corporate Responsibility Committee
B O A R D O F D I R E C T O R S A N D L E A D E R S H I P
22
Freeport | Powering Progress
24
Selected Operating Data
26
Management’s Discussion and Analysis
59
Management’s Report on Internal Control
Over Financial Reporting
60
Report of Independent Registered Public
Accounting Firm
61
Report of Independent Registered Public
Accounting Firm
64
Consolidated Statements of Income
65
Consolidated Statements of Comprehensive Income
66
Consolidated Statements of Cash Flows
67
Consolidated Balance Sheets
68
Consolidated Statements of Equity
69
Notes to Consolidated Financial Statements
T A B L E O F C O N T E N T S
F I N A N C I A L A N D O P E R A T I N G I N F O R M A T I O N
2024 Annual Report
23
S E L E C T E D O P E R A T I N G D A T A
24
Freeport | Powering Progress
Years Ended December 31,
2024
2023
2022
2021
2020
CONSOLIDATED MINING
Copper (millions of recoverable pounds)
Production
4,214
4,212
4,210
3,843
3,206
Sales, excluding purchases
4,066
4,086
4,213
3,807
3,202
Average realized price per pound
$
4.21
$
3.85
$
3.90
$
4.33
$
2.95
Gold (thousands of recoverable ounces)
Production
1,880
1,993
1,811
1,381
857
Sales, excluding purchases
1,837
1,713
1,823
1,360
855
Average realized price per ounce
$ 2,418
$ 1,972
$ 1,787
$ 1,796
$ 1,832
Molybdenum (millions of recoverable pounds)
Production
80
82
85
85
76
Sales, excluding purchases
78
81
75
82
80
Average realized price per pound
$ 21.77
$ 24.64
$ 18.71
$ 15.56
$ 10.20
NORTH AMERICA COPPER MINES
Operating Data, Net of Joint Venture Interestsa
Copper (millions of recoverable pounds)
Production
1,246
1,350
1,467
1,460
1,418
Sales, excluding purchases
1,257
1,361
1,469
1,436
1,422
Average realized price per pound
$
4.29
$
3.93
$
4.08
$
4.30
$
2.82
Molybdenum (millions of recoverable pounds)
Production
30
30
29
34
33
100% Operating Data
Leach operations
Leach ore placed in stockpiles (metric tons per day)
609,400
692,000
676,400
665,900
714,300
Average copper ore grade (%)
0.20
0.23
0.29
0.29
0.27
Copper production (millions of recoverable pounds)
842
941
1,019
1,056
1,047
Mill operations
Ore milled (metric tons per day)
311,700
308,500
294,200
269,500
279,700
Average ore grade (%):
Copper
0.30
0.32
0.37
0.38
0.35
Molybdenum
0.02
0.02
0.02
0.03
0.02
Copper recovery rate (%)
83.2
81.8
81.8
81.2
84.1
Copper production (millions of recoverable pounds)
601
633
695
649
647
SOUTH AMERICA OPERATIONS
Copper (millions of recoverable pounds)
Production
1,168
1,202
1,176
1,047
979
Sales
1,177
1,200
1,162
1,055
976
Average realized price per pound
$
4.16
$
3.82
$
3.80
$
4.34
$
3.05
Molybdenum (millions of recoverable pounds)
Production
20
22
23
21
19
Leach operations
Leach ore placed in stockpiles (metric tons per day)
164,300
191,200
163,000
163,900
160,300
Average copper ore grade (%)
0.42
0.35
0.35
0.32
0.35
Copper production (millions of recoverable pounds)
295
317
302
256
241
Mill operations
Ore milled (metric tons per day)
415,500
417,400
409,200
380,300
331,600
Average ore grade (%):
Copper
0.33
0.34
0.32
0.31
0.34
Molybdenum
0.01
0.01
0.01
0.01
0.01
Copper recovery rate (%)
83.6
81.3
85.3
87.3
84.3
Copper production (millions of recoverable pounds)
873
885
874
791
738
a. Amounts are net of Morenci’s joint venture partners’ undivided interest.
S E L E C T E D O P E R A T I N G D A T A
Years Ended December 31,
2024
2023
2022
2021
2020
INDONESIA OPERATIONS
Copper (millions of recoverable pounds)
Production
1,800
1,660
1,567
1,336
809
Sales
1,632
1,525
1,582
1,316
804
Average realized price per pound
$
4.19
$
3.81
$
3.80
$
4.34
$ 3.08
Gold (thousands of recoverable ounces)
Production
1,861
1,978
1,798
1,370
848
Sales
1,817
1,697
1,811
1,349
842
Average realized price per ounce
$ 2,418
$ 1,972
$ 1,787
$ 1,796
$ 1,832
Mill operations
Ore milled (metric tons per day)
208,400
198,300
192,600
151,600
87,700
Average ore grade:
Copper (%)
1.27
1.22
1.19
1.30
1.32
Gold (grams per metric ton)
1.00
1.12
1.05
1.04
1.10
Recovery rates (%):
Copper
88.4
89.7
90.0
89.8
91.9
Gold
76.9
77.9
77.7
77.0
78.1
MOLYBDENUM MINES
Ore milled (metric tons per day)
28,000
27,900
26,100
21,800
20,700
Average molybdenum ore grade (%)
0.16
0.15
0.18
0.19
0.17
Molybdenum production (millions of recoverable pounds)
30
30
33
30
24
2024 Annual Report
25
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
26
Freeport | Powering Progress
In Management’s Discussion and Analysis of Financial Condition
and Results of Operations and Quantitative and Qualitative
Disclosures About Market Risk (MD&A), “we,” “us” and “our” refer
to Freeport-McMoRan Inc. and its consolidated subsidiaries.
The results of operations reported and summarized below include
forward-looking statements that are not guarantees of future
performance and are not necessarily indicative of future operating
results (refer to “Cautionary Statement” below for further discussion).
References to “Notes” are Notes included in our Notes to Consolidated
Financial Statements. Throughout MD&A, all references to income
or losses per share are on a diluted basis.
This section of our Form 10-K discusses the results of operations
for the years 2024 and 2023 and comparisons between these
years. Discussion of the results of operations for the year 2022 and
comparisons between the years 2023 and 2022 are not included in
this Form 10-K and can be found in Items 7. and 7A. “Management’s
Discussion and Analysis of Financial Condition and Results of
Operations and Quantitative and Qualitative Disclosures About
Market Risk” contained in Part II of our Annual Report on Form 10-K
for the fiscal year ended December 31, 2023.
OVERVIEW
We are a leading international metals company with the objective
of being foremost in copper. Headquartered in Phoenix, Arizona,
we operate large, long-lived, geographically diverse assets with
significant proven and probable mineral reserves of copper, gold
and molybdenum. We are one of the world’s largest publicly traded
copper producers. Our portfolio of assets includes the Grasberg
minerals district in Indonesia, one of the world’s largest copper and
gold deposits; and significant operations in North America and
South America, including the large-scale Morenci minerals district
in Arizona and the Cerro Verde operation in Peru.
Our results for 2024 reflect solid execution of our operating
plans and we are committed to enhancing productivity, managing
costs and capital and advancing opportunities for long-term
profitable growth and value creation. We believe the actions we
have taken in recent years to strengthen our balance sheet and
maintain flexible organic growth options will allow us to continue to
execute our business plans, and reliably and responsibly generate
cash flows to pursue value-enhancing organic growth options and
return cash to shareholders.
We believe that we have a high-quality portfolio of long-lived
copper assets positioned to generate long-term value, and we
remain focused on executing our operating and investment plans.
Our underground mining operations at the Grasberg minerals
district in Indonesia continue to perform well, with copper
production increasing in each of the past three years. During 2024,
construction of PT Freeport Indonesia’s (PT-FI) new smelter
and precious metals refinery (PMR) (collectively, PT-FI’s new
downstream processing facilities) in Eastern Java, Indonesia were
completed and as part of start-up activities, PT-FI commenced gold
production from the PMR in December 2024. In October 2024,
during start-up activities of the new smelter, a fire occurred requiring
a temporary suspension of smelting operations to complete repairs.
PT-FI expects repairs to be completed by mid-2025 and ramp-up to
full capacity to be achieved by year-end 2025.
We are progressing initiatives across our North America
and South America operations by incorporating new applications,
technologies and data analytics to our leaching processes.
Incremental copper production from these initiatives totaled 214 million
pounds in 2024, compared with a total of 144 million pounds in 2023.
We have projects underway to apply recent operational enhancements
to our leaching processes on a larger scale and are testing new
innovative technology applications that we believe have the potential
for significant increases in recoverable metal from leach stockpiles
beyond the current run rate.
We believe we benefit from significant copper reserves and
resources with embedded growth options, an experienced team and
exposure to markets with a favorable fundamental outlook.
Net income attributable to common stock totaled $1.9 billion in
2024 and $1.8 billion in 2023. Our results in 2024, compared to 2023,
primarily reflect higher average realized copper and gold prices and
higher gold sales volumes, partly offset by higher operating costs
and higher income attributable to noncontrolling interests primarily
related to higher operating income at PT-FI. Refer to “Consolidated
Results” for discussion of items impacting our consolidated results
for the two years ended December 31, 2024.
At December 31, 2024, we had consolidated debt of $8.9 billion
and consolidated cash and cash equivalents of $3.9 billion, $4.7 billion
including current restricted cash and cash equivalents associated
with a portion of PT-FI’s export proceeds required to be temporarily
deposited in Indonesia banks. Net debt totaled $1.06 billion, excluding
$3.2 billion of debt for PT-FI’s new downstream processing
facilities. Refer to “Net Debt” for reconciliations of consolidated
debt, consolidated cash and cash equivalents and current restricted
cash associated with PT-FI’s export proceeds to net debt.
At December 31, 2024, we had $3.0 billion of availability under our
revolving credit facility, and PT-FI and Cerro Verde had $1.5 billion
and $350 million, respectively, of availability under their revolving
credit facilities. In November 2024, we repaid $0.7 billion in
scheduled senior note maturities using cash on hand and have no
further senior note maturities until 2027. Refer to Note 6 and
“Capital Resources and Liquidity” for further discussion of our debt.
We have significant mineral reserves, mineral resources and
future development opportunities within our portfolio of mining
assets. At December 31, 2024, our estimated consolidated
recoverable proven and probable mineral reserves totaled 97.0 billion
pounds of copper, 23.0 million ounces of gold and 3.16 billion
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
2024 Annual Report
27
pounds of molybdenum. Refer to Note 15 and “Critical Accounting
Estimates—Mineral Reserves” for further discussion.
During 2024, production from our mines totaled 4.2 billion
pounds of copper, 1.9 million ounces of gold and 80 million
pounds of molybdenum. Following is the allocation of our
consolidated copper, gold and molybdenum production in 2024
by geographic location:
Copper
Gold
Molybdenum
North America
29%
1%
75%a
South America
28
—
25
Indonesia
43
99
—
100%
100%
100%
a. Our North America copper mines produced 38% of consolidated molybdenum production, and our
Henderson and Climax molybdenum mines produced 37%.
Copper production from three of our mines (the Morenci mine
in North America, the Cerro Verde mine in Peru and the Grasberg
minerals district in Indonesia) together totaled 77% of our
consolidated copper production in 2024.
OUTLOOK
Our financial results vary as a result of fluctuations in market prices
primarily for copper, gold and, to a lesser extent, molybdenum,
as well as other factors. World market prices for these commodities
have fluctuated historically and are affected by numerous factors
beyond our control. Refer to “Markets,” and Item 1A. “Risk Factors”
contained in Part I of our annual report on Form 10-K for the year
ended December 31, 2024, for further discussion. Because we
cannot control the prices of our products, the key measures that
management focuses on in operating our business are sales volumes,
unit net cash costs, operating cash flows and capital expenditures.
The forward-looking statements in the below section and
elsewhere in this annual report on Form 10-K are based on current
market conditions, speak only as of the filing date of this annual
report on Form 10-K, are based on several assumptions and are
subject to significant risks and uncertainties. Refer to “Cautionary
Statement” below.
Consolidated Sales Volumes. Following are our projected
consolidated sales volumes for 2025 and actual consolidated sales
volumes for 2024:
2025
2024
(Projected)
(Actual)
Copper (millions of recoverable pounds):
North America copper mines
1,360
1,257
South America mining
1,090
1,177
Indonesia mining
1,550
1,632
Total
4,000
4,066
Gold (thousands of recoverable ounces)
1,625
1,837
Molybdenum (millions of recoverable pounds)
88a
78
a. Includes 53 million pounds from our North America and South America copper mines and 35 million
pounds from our Molybdenum mines.
Projected sales volumes are dependent on operational performance;
Indonesia regulatory approval to export copper concentrate until
repairs and full ramp-up of PT-FI’s new smelter are complete; weather-
related conditions; timing of shipments and other factors. For further
discussion of other important factors that could cause results to
differ materially from projections, refer to Item 1A. “Risk Factors”
contained in Part I of our annual report on Form 10-K for the year ended
December 31, 2024.
Consolidated Unit Net Cash Costs. Consolidated unit net cash
costs (net of by-product credits) for our copper mines are expected
to average $1.60 per pound of copper for the year 2025, based
on achievement of current sales volume estimates (including
estimates for copper concentrate exports from Indonesia) and
cost estimates and assuming average prices of $2,700 per ounce
of gold and $20.00 per pound of molybdenum for the year 2025.
Quarterly unit net cash costs vary with fluctuations in sales
volumes, including the ratio of copper and gold sales within a period,
and realized prices, primarily for gold and molybdenum. The
impact of price changes on consolidated unit net cash costs for the
year 2025 would approximate $0.04 per pound of copper for each
$100 per ounce change in the average price of gold and $0.03
per pound of copper for each $2 per pound change in the average
price of molybdenum.
Consolidated Operating Cash Flows. Our consolidated operating
cash flows vary with sales volumes; prices realized from copper,
gold and molybdenum sales; production costs; income taxes; other
working capital changes; and other factors. Our consolidated
operating cash flows are estimated to approximate $6.2 billion for
the year 2025, based on current sales volume and cost estimates,
and assuming average prices of $4.00 per pound of copper, $2,700
per ounce of gold and $20.00 per pound of molybdenum for
the year 2025. Estimated consolidated operating cash flows in 2025
also reflect a projected income tax provision of $2.6 billion (refer
to “Consolidated Results—Income Taxes” for further discussion of
our projected income tax rate). The impact of price changes
on operating cash flows for the year 2025 would approximate
$375 million for each $0.10 per pound change in the average price
of copper, $140 million for each $100 per ounce change in the
average price of gold and $135 million for each $2 per pound change
in the average price of molybdenum.
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
28
Freeport | Powering Progress
Indonesia operations are generally based on quoted LME monthly
average copper settlement prices. For the year 2024, the LME copper
settlement prices averaged $4.15 per pound (ranging from a low of
$3.67 per pound to a high of $4.92 per pound) and closed at $3.95 per
pound on December 31, 2024. The LME copper settlement prices
averaged $4.07 per pound in January 2025, and closed at $4.25 per
pound on February 13, 2025.
Copper sales from our North America copper mines are generally
based on prevailing COMEX monthly average copper settlement
prices. For the year 2024, COMEX copper settlement prices
averaged $4.22 per pound (ranging from a low of $3.69 per pound to
a high of $5.12 per pound) and closed at $3.99 per pound on
December 31, 2024. COMEX copper settlement prices averaged
$4.25 per pound in January 2025, and closed at $4.77 per pound on
February 13, 2025.
We believe fundamentals for copper are favorable with growing
demand supported by copper’s critical role in the global transition
to renewable power, electric vehicles and other carbon-reduction
initiatives, continued urbanization in developing countries, data
centers and artificial intelligence developments and growing
connectivity globally.
This graph presents London PM gold prices from January 2015
through December 2024. For the year 2024, London PM gold prices
averaged $2,386 per ounce (ranging from a low of $1,985 per ounce
to a high of $2,778 per ounce) and closed at $2,609 per ounce on
December 31, 2024. Interest rate reductions, geopolitical tensions
and strong demand from central banks positively impacted gold
prices during 2024. The London PM gold prices averaged $2,710
per ounce in January 2025, and closed at $2,915 per ounce on
February 13, 2025.
Consolidated Capital Expenditures. Following is a summary
of expected capital expenditures for the year 2025 (in billions):
Major mining projects
$ 2.8a
PT-FI’s new downstream processing facilities
0.6b
Sustaining capital and other
1.6
Total
$ 5.0
a. Includes $1.1 billion for planned projects, primarily associated with underground mine development,
supporting mill and power capital costs and a portion of spending on a new gas-fired combined
cycle facility in the Grasberg minerals district, and expansion projects in North America, and
$1.7 billion for discretionary growth projects, primarily in the Grasberg minerals district for the
development of Kucing Liar and at the Bagdad mine for tailings infrastructure.
b. Excludes capitalized interest, commissioning and owner’s costs. Capital expenditures for PT-FI’s new
downstream processing facilities are expected to be funded with PT-FI’s cash flows from operations
and availability under PT-FI’s revolving credit facility.
We closely monitor market conditions and will adjust our operating
plans, including capital expenditures, to protect our liquidity and
preserve our asset values, as necessary.
MARKETS
Prices for copper, gold and molybdenum are affected by numerous
factors beyond our control and can fluctuate significantly (for
further discussion refer to “Risk Factors” contained in Part I, Item 1A.
of our annual report on Form 10-K for the year ended December 31,
2024). The following graphs present the London Metal Exchange
(LME) copper settlement prices, the London Bullion Market
Association (London) PM gold prices, and the Platts Metals Daily
Molybdenum Dealer Oxide weekly average prices since January 2015.
This graph presents LME copper settlement prices and the combined
reported stocks of copper at the LME, Commodity Exchange Inc.
(COMEX) and the Shanghai Futures Exchange from January 2015
through December 2024. Copper sales from our South America and
LME Copper Prices
Through December 31, 2024
LME Copper Prices
Exchange Stocks
000s of metric tons
Dollars per pound
$5.00
$4.50
$4.00
$3.50
$3.00
$2.50
$2.00
$1.50
$1.00
$0.50
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
1,500
1,200
900
600
300
London Gold Prices
Through December 31, 2024
$3,000
$2,750
$2,500
$2,250
$2,000
$1,750
$1,500
$1,250
$1,000
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
Dollars per ounce
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
2024 Annual Report
29
In preparing our consolidated financial statements, we estimate
the actual amount of income taxes currently payable or receivable
as well as deferred income tax assets and liabilities attributable to
temporary differences between the financial statement carrying
amounts of existing assets and liabilities and their respective tax
bases. Deferred income tax assets and liabilities are measured using
enacted tax rates expected to apply to taxable income in the years
in which these temporary differences are expected to be recovered
or settled. The effect on deferred income tax assets and liabilities
of a change in tax rates or laws is recognized in income in the period
in which such changes are enacted.
Income taxes represent a critical accounting estimate as our
operations are in multiple tax jurisdictions where uncertainties arise
in the application of complex tax regulations and our income tax
returns are subject to examination by tax authorities in those
jurisdictions who may challenge any tax position on these returns.
Some of these tax regimes are defined by contractual agreements
with the local government, while others are defined by general
tax laws and regulations. We and our subsidiaries are subject to
reviews of our income tax filings and other tax payments, and
disputes can arise with the taxing authorities over the interpretation
of our contracts or laws. Uncertainty in a tax position may arise
because tax laws are subject to interpretation. We use significant
judgment to (1) determine whether, based on the technical merits, a
tax position is more likely than not to be sustained upon examination
by taxing authorities and (2) measure the amount of tax benefit that
qualifies for recognition.
A valuation allowance is provided for those deferred income tax
assets for which available information, including positive and
negative evidence, suggests that the related benefits will not be
realized. In determining the amount of the valuation allowance, we
consider carryback opportunities, future reversals of existing taxable
temporary differences, prudent and feasible tax planning strategies
in each jurisdiction, as well as future taxable income exclusive of
reversing temporary differences. If we determine that we will not
realize all or a portion of our deferred income tax assets, we will
increase our valuation allowance. Conversely, if we determine that
we will ultimately be able to realize all or a portion of the related
benefits for which a valuation allowance has been provided, all or a
portion of the related valuation allowance will be reduced. Refer
to Note 9 for further discussion of our valuation allowances.
This graph presents the Platts Metals Daily Molybdenum Dealer
Oxide weekly average prices from January 2015 through
December 2024. For the year 2024, the weekly average prices for
molybdenum averaged $21.30 per pound (ranging from a low of
$19.34 per pound to a high of $23.52 per pound) and was $21.08
per pound on December 31, 2024. Overall global demand for
molybdenum is driven by energy, power generation, aerospace,
defense and construction sectors. We believe fundamentals for
molybdenum are positive with favorable demand drivers and limited
supply. The Platts Metals Daily Molybdenum Dealer Oxide weekly
average price for January 2025 was $20.82 per pound and was
$20.70 per pound on February 13, 2025.
CRITICAL ACCOUNTING ESTIMATES
MD&A is based on our consolidated financial statements, which
have been prepared in conformity with generally accepted
accounting principles (GAAP) in the U.S. The preparation of these
statements requires that we make estimates and assumptions
that affect the reported amounts of assets, liabilities, revenues
and expenses. We base these estimates on historical experience
and on assumptions that we consider reasonable under the
circumstances; however, reported results could differ from those
based on the current estimates under different assumptions or
conditions. The areas requiring the use of management’s estimates
are also discussed in Note 1 under the subheading “Use of
Estimates.” Management has reviewed the following discussion
of its development and selection of critical accounting estimates
with the Audit Committee of our Board of Directors (Board).
Income Taxes. Refer to Note 9, and Item 1A. “Risk Factors”
contained in Part I of our annual report on Form 10-K for the year
ended December 31, 2024, for further discussion of our consolidated
income taxes.
Platts Metals Daily Molybdenum Dealer Oxide Prices
Through December 31, 2024
$40
$35
$30
$25
$20
$15
$10
$5
$0
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
Dollars per pound
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
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Freeport | Powering Progress
depending upon their future economic benefits. The guidance
provided by U.S. GAAP requires that liabilities for contingencies be
recorded when it is probable that obligations have been incurred,
and the cost can be reasonably estimated. At December 31, 2024,
environmental obligations recorded in our consolidated balance
sheet totaled $2.0 billion, which reflect obligations for environmental
liabilities attributed to the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980 or analogous
state programs and for estimated future costs associated with
environmental matters.
Accounting for environmental obligations represents a critical
accounting estimate because (i) changes to environmental laws and
regulations and/or circumstances affecting our operations could
result in significant changes to our estimates, which could have a
significant impact on our results of operations, (ii) we will not incur
most of these costs for a number of years, requiring us to make
estimates over a long period, (iii) calculating the discounted cash
flows for certain of our environmental obligations requires
management to estimate the amounts and timing of projected cash
flows and make long-term assumptions about inflation rates and
(iv) changes in estimates used in determining our environmental
obligations could have a significant impact on our results of operations.
We perform a comprehensive annual review of our environmental
obligations and also review changes in facts and circumstances
associated with these obligations at least quarterly. Judgments and
estimates are based upon currently available facts, existing
technology, presently enacted laws and regulations, remediation
experience, whether we are a potentially responsible party (PRP),
the ability of other PRPs to pay their allocated portions and
take into consideration reasonably possible outcomes. Our cost
estimates can change substantially as additional information
becomes available regarding the nature or extent of site contamination,
updated cost assumptions (including increases and decreases
to cost estimates), changes in the anticipated scope and timing of
remediation activities, the settlement of environmental matters,
required remediation methods and actions by or against
governmental agencies or private parties.
Asset Retirement Obligations. Refer to Notes 1 and 10, and Item 1A.
“Risk Factors” contained in Part I of our annual report on Form 10-K
for the year ended December 31, 2024, for further discussion of
reclamation and closure costs, including a summary of changes in
our asset retirement obligations (AROs) for the three years ended
December 31, 2024.
We record the fair value of our estimated AROs associated
with tangible long-lived assets in the period incurred. Fair value is
measured as the present value of cash flow estimates after
considering inflation and a market risk premium. Our cost estimates
On January 1, 2023, the provisions of the U.S. Inflation Reduction
Act of 2022 (the Act) became applicable to us. The Act includes,
among other provisions, a new Corporate Alternative Minimum Tax
(CAMT) of 15% on the adjusted financial statement income (AFSI)
of corporations with average annual AFSI exceeding $1.0 billion over
a three-year period.
In September 2024, the Internal Revenue Service (IRS) issued
proposed regulations that provide guidance on the application
of the CAMT, which are not final and subject to change. Based on
the proposed guidance released by the IRS, we determined that
the provisions of the Act did not impact our financial results for the
years 2024 or 2023.
In December 2021, the Organisation for Economic Cooperation
and Development (OECD) published a framework for Pillar Two of
the Global Anti-Base Erosion Rules, which was designed to
coordinate participating jurisdictions in updating the international
tax system to ensure that large multinational companies pay a
minimum level of income tax. Recommendations from the OECD
regarding a global minimum income tax and other changes are
being considered and/or implemented in jurisdictions where we
operate. At current metals market prices, we do not expect
enactment of the recommended framework in jurisdictions where
we operate to materially impact our financial results.
We have uncertain tax positions related to income tax assessments
in Peru and Indonesia, including penalties and interest, which
have not been recorded at December 31, 2024. Final taxes paid may
be dependent upon many factors, including negotiations with
taxing authorities. In certain jurisdictions, we pay a portion of the
disputed amount before formally appealing an assessment. Such
payment is recorded as a receivable if we believe the amount is
collectible. Refer to Note 10 for further discussion.
Environmental Obligations. Refer to Notes 1 and 10, and Item 1A.
“Risk Factors” contained in Part I of our annual report on Form
10-K for the year ended December 31, 2024, for further discussion
of environmental obligations, including a summary of changes in
our estimated environmental obligations for the three years ended
December 31, 2024.
Our current and historical operating activities are subject to
various national, state and local environmental laws and
regulations that govern emissions of air pollutants; discharges
of water pollutants; generation, handling, storage, treatment,
transportation and disposal of hazardous substances, hazardous
wastes and other toxic materials; and remediation, restoration
and reclamation of environmental contamination, and compliance
with these laws and regulations requires significant expenditures.
Environmental expenditures are charged to expense or capitalized,
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
2024 Annual Report
31
Estimating the quantity and grade of mineral reserves requires us
to determine the size, shape and depth of our ore bodies by
analyzing geological data, such as samplings of drill holes, tunnels
and other underground workings. In addition to the geology of
our mines, assumptions are required to determine the economic
feasibility of mining these reserves, including estimates of future
commodity prices, the mining methods we use and the related costs
incurred to develop and mine our mineral reserves. Our estimates
of recoverable proven and probable mineral reserves are prepared by
and are the responsibility of our employees. These estimates are
reviewed and verified regularly by independent experts in mining,
geology and reserve determination.
Our estimated recoverable proven and probable mineral reserves
at December 31, 2024, were determined using metal price assumptions
of $3.25 per pound of copper, $1,600 per ounce of gold and $12.00
per pound of molybdenum. The following table summarizes changes
in our estimated consolidated recoverable proven and probable
mineral reserves during 2024:
Copper
Gold
Molybdenum
(billion
(million
(billion
pounds)
ounces)
pounds)
Reserves at December 31, 2023a
104.1
24.5
3.34
Net revisions
(3.0)b
0.4
(0.10)
Production
(4.2)
(1.9)
(0.08)
Reserves at December 31, 2024a,c
97.0
23.0
3.16
a. Includes estimated recoverable metals contained in stockpiles. See below for additional discussion
of recoverable copper in stockpiles.
b. Revisions are primarily the result of higher cost assumptions and updated geologic models.
c. May not foot because of rounding.
As discussed in Note 1, we depreciate our life-of-mine mining and
milling assets and values assigned to proven and probable mineral
reserves using the unit-of-production (UOP) method based on
our estimated recoverable proven and probable mineral reserves.
Because the economic assumptions used to estimate mineral
reserves may change from period to period and additional geological
data is generated during the course of operations, estimates of
mineral reserves may change, which could have a significant impact
on our results of operations, including changes to prospective
depreciation rates and impairments of long-lived asset carrying
values. Based on projected copper sales volumes, if estimated
copper reserves at our mines were 10% higher at December 31,
2024, we estimate that our annual depreciation, depletion and
amortization (DD&A) expense for 2025 would decrease by
approximately $110 million (approximately $43 million to net income
attributable to common stock), and a 10% decrease in copper
reserves would increase DD&A expense by approximately
$137 million (approximately $53 million to net income attributable
to common stock). We perform annual assessments of our
are reflected on a third-party cost basis and comply with our legal
obligation to retire tangible long-lived assets in the period incurred.
These cost estimates may differ from financial assurance cost
estimates for reclamation activities because of a variety of factors,
including obtaining updated cost estimates for reclamation
activities, the timing of reclamation activities, changes in scope
and the exclusion of certain costs not considered reclamation and
closure costs. At December 31, 2024, AROs recorded in our
consolidated balance sheet totaled $3.7 billion.
Generally, ARO activities are specified by regulations or in permits
issued by the relevant governing authority, and management’s
judgment is required to estimate the extent and timing of
expenditures. Accounting for AROs represents a critical accounting
estimate because (i) we will not incur most of these costs for a
number of years, requiring us to make estimates over a long period,
(ii) reclamation and closure laws and regulations could change in
the future, we may commit to taking additional closure actions
and/or circumstances affecting our operations could change,
(iii) the methods used or required to plug and abandon non-producing
oil and gas wellbores, remove platforms, tanks, production
equipment and flow lines, and restore the wellsite could change,
(iv) calculating the fair value of our AROs requires management
to estimate projected cash flows, make long-term assumptions
about inflation rates, determine our credit-adjusted, risk-free
interest rates and determine market risk premiums that are
appropriate for our operations and (v) given the magnitude of our
estimated reclamation, mine closure and wellsite abandonment and
restoration costs, changes in any or all of these estimates could
have a significant impact on our results of operations.
Mineral Reserves. Refer to Note 15, and Items 1. and 2. “Business
and Properties” and Item 1A. “Risk Factors” contained in Part I
of our annual report on Form 10-K for the year ended December 31,
2024, for further information regarding, and risks associated with,
our estimated recoverable proven and probable mineral reserves.
Recoverable proven and probable mineral reserves were
determined from the application of relevant modifying factors to
geological data, in order to establish an operational, economically
viable mine plan, and have been prepared in accordance with
the disclosure requirements of Subpart 1300 of U.S. Securities and
Exchange Commission Regulation S-K. The determination of
mineral reserves represents a critical accounting estimate because
it involves numerous uncertainties with respect to the ultimate
geology of the ore bodies, including quantities, grades and recoveries.
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
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Impairment of Long-Lived Mining Assets. Refer to Note 1, and
Item 1A. “Risk Factors” contained in Part I of our annual report on
Form 10-K for the year ended December 31, 2024, for further
information regarding, and risks associated with, impairment of
long-lived mining assets.
We assess the carrying values of our long-lived mining assets
when events or changes in circumstances indicate that the related
carrying amounts of such assets may not be recoverable. In
evaluating our long-lived mining assets for recoverability, we use
estimates of pre-tax undiscounted future cash flows of our mines.
Estimates of future cash flows are derived from current business
plans, which are developed using near-term metal price forecasts
reflective of the current price environment and management’s
projections for long-term average metal prices. In addition to
near- and long-term metal price assumptions, other key assumptions
include estimates of commodity-based and other input costs;
proven and probable mineral reserves estimates, including the
timing and cost to develop and produce the mineral reserves; value
beyond proven and probable mineral reserve estimates; and the
use of appropriate discount rates in the measurement of fair value.
We believe our estimates and models used to determine fair
value are similar to what a market participant would use. As quoted
market prices are unavailable for our individual mining operations,
fair value is determined through the use of after-tax discounted
estimated future cash flows.
During the two-year period ended December 31, 2024, no material
impairments of our long-lived mining assets were recorded.
In addition to decreases in future metal price assumptions, other
events that could result in future impairment of our long-lived
mining assets include, but are not limited to, decreases in estimated
recoverable proven and probable mineral reserves and any event
that might otherwise have a material adverse effect on mine site
production levels or costs.
existing assets in connection with the review of mine operating
and development plans. If it is determined that assigned asset
lives do not reflect the expected remaining period of benefit, any
change could affect prospective DD&A rates.
As discussed below, we review and evaluate our long-lived
assets for impairment when events or changes in circumstances
indicate that the related carrying amount of such assets may not
be recoverable, and changes to our estimates of recoverable
proven and probable mineral reserves could have an impact on
our assessment of asset recoverability.
Recoverable Copper in Stockpiles. Refer to Note 1 for further
discussion of our accounting policy for recoverable copper in mill
and leach stockpiles, including adjustments to stockpile inventory
volumes, and Item 1A. “Risk Factors” contained in Part I of our
annual report on Form 10-K for the year ended December 31, 2024,
for risks associated with implementation of new technologies
associated with the recovery of copper in leach stockpiles.
We record, as inventory, applicable costs for copper contained
in mill and leach stockpiles that are expected to be processed in
the future based on proven processing technologies. Mill and leach
stockpiles are evaluated periodically to ensure that they are stated
at the lower of weighted-average cost or net realizable value.
Accounting for recoverable copper from mill and leach stockpiles
represents a critical accounting estimate because (i) it is impracticable
to determine copper contained in mill and leach stockpiles by
physical count, thus requiring management to employ reasonable
estimation methods and (ii) recoveries from leach stockpiles can
vary significantly.
At December 31, 2024, estimated consolidated recoverable
copper was 1.4 billion pounds in leach stockpiles (with a carrying
value of $2.2 billion) and 0.3 billion pounds in mill stockpiles
(with a carrying value of $0.4 billion).
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
2024 Annual Report
33
CONSOLIDATED RESULTS
Years Ended December 31,
2024
2023
SUMMARY FINANCIAL DATA (in millions, except per share amounts)
Revenuesa,b
$ 25,455
$ 22,855
Operating incomea,c
$ 6,864
$ 6,225
Net income attributable to common stockb,c
$ 1,889d
$ 1,848e
Diluted net income per share attributable to common stockb,c
$ 1.30d
$ 1.28e
Diluted weighted-average common shares outstanding
1,445
1,443
Operating cash flowsf
$ 7,160
$ 5,279
Capital expenditures
$ 4,808
$ 4,824
At December 31:
Cash and cash equivalents
$ 3,923
$ 4,758
Restricted cash and cash equivalents, currentg
$
888
$ 1,208
Total debt, including current portion
$ 8,948
$ 9,422
a. Refer to Note 14 for a summary of revenues and operating income by operating division.
b. Includes favorable adjustments to prior period provisionally priced concentrate and cathode copper sales totaling $28 million ($9 million to net income attributable to common stock or $0.01 per share) in 2024 and
$183 million ($62 million to net income attributable to common stock or $0.04 per share) in 2023 (refer to Note 12).
c. We defer 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 (reductions) to operating
income totaling $21 million ($(3) million to net income attributable to common stock or less than $0.01 per share) in 2024 and $64 million ($37 million to net income attributable to common stock or $0.03 per share) in 2023.
d. Includes net charges totaling $257 million ($0.18 per share), primarily associated with adjustments to PT-FI’s ARO, oil and gas charges for impairments and abandonment obligations, metals inventory adjustments, net
adjustments to environmental obligations and related litigation reserves and nonrecurring labor-related charges at Cerro Verde, partly offset by net credits associated with historical tax matters at PT-FI and a reduction in
accruals for uncertain U.S. tax positions.
e. Includes net charges totaling $373 million ($0.26 per share), primarily associated with net adjustments to environmental obligations and related litigation reserves, contested tax rulings issued by the Peru Supreme Court,
impairment of oil and gas properties and an accrual for an administrative fine in Indonesia, partly offset by adjustments to PT-FI’s ARO.
f. Working capital and other uses totaled $29 million in 2024 and $880 million in 2023.
g. Includes $0.7 billion at December 31, 2024, and $1.1 billion at December 31, 2023, associated with a portion of PT-FI’s export proceeds required to be temporarily deposited in Indonesia banks for 90 days in accordance
with Indonesia regulations (refer to Notes 10 and 12).
Years Ended December 31,
2024
2023
SUMMARY OPERATING DATA
Copper (millions of recoverable pounds)
Production
4,214
4,212
Sales, excluding purchases
4,066
4,086
Average realized price per pound
$ 4.21
$ 3.85
Site production and delivery costs per pounda
$ 2.49
$ 2.36
Unit net cash costs per pounda
$ 1.56
$ 1.61
Gold (thousands of recoverable ounces)
Production
1,880
1,993
Sales, excluding purchases
1,837
1,713
Average realized price per ounce
$ 2,418
$ 1,972
Molybdenum (millions of recoverable pounds)
Production
80
82
Sales, excluding purchases
78
81
Average realized price per pound
$ 21.77
$24.64
a. Reflects per pound weighted-average production and delivery costs and unit net cash costs (net of by-product credits) for all copper mines, before net noncash and other costs. For reconciliations of the per pound unit
net cash costs by operating division to production and delivery costs applicable to sales reported in our consolidated financial statements, refer to “Product Revenues and Production Costs.”
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
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date of final pricing. Accordingly, in times of rising copper and
gold prices, our revenues benefit from adjustments to the final
pricing of provisionally priced sales pursuant to contracts entered
into in prior periods; in times of falling copper and gold prices, the
opposite occurs.
Consolidated revenues include net favorable (unfavorable)
adjustments to current year provisionally priced copper sales (i.e.,
provisionally priced sales during the years 2024 and 2023) totaling
$89 million for 2024 and $(86) million for 2023. See below for
discussion of adjustments related to prior year provisionally priced
copper sales.
Prior Year Provisionally Priced Copper Sales. Net favorable
adjustments to prior years’ provisionally priced copper sales (i.e.,
provisionally priced copper sales at December 31, 2023 and 2022)
recorded in consolidated revenues totaled $28 million in 2024
and $183 million in 2023. Refer to “Disclosures About Market Risks—
Commodity Price Risk” for further discussion of our provisionally
priced copper sales, and to Note 12 for a summary of total
adjustments to prior period and current period provisionally priced
copper sales.
Atlantic Copper Revenues. Higher Atlantic Copper revenues of
$3.0 billion in 2024, compared with $2.8 billion in 2023, primarily
reflect higher copper prices.
Sales of Purchased Copper. We purchase copper cathode primarily
for processing by our Rod & Refining operations. The volumes of
copper purchases vary depending on cathode production from our
operations and totaled 158 million pounds in 2024 and 103 million
pounds in 2023. Revenues associated with the sale of purchased
copper vary with the volume of copper purchases and changes in
copper prices.
Treatment Charges. Revenues from our concentrate sales are
recorded net of treatment charges (i.e., fees paid to smelters that
are generally negotiated annually), which will vary with the sales
volumes and the price of copper. The decrease in treatment charges
in 2024, compared to 2023, primarily reflects lower copper
concentrate sales volumes in South America.
Export Duties and Royalties. Export duties and royalties are primarily
associated with PT-FI sales. Effective March 29, 2023, PT-FI’s export
duties of 2.5% were eliminated upon verification that construction
progress of its new smelter exceeded 50%, but were reinstated at
a rate of 7.5% in July 2023 under a revised regulation. PT-FI incurred
export duties totaling $457 million in 2024 and $324 million in 2023.
Royalties will vary with the volume of metal sold and the prices
of copper and gold. Refer to Note 11 for discussion of PT-FI’s export
duties and royalties.
Revenues
Consolidated revenues totaled $25.5 billion in 2024 and $22.9 billion
in 2023. Our revenues primarily include the sale of copper concentrate,
copper cathode, copper rod, gold in concentrate and anode
slimes, and molybdenum. Following is a summary of changes in
our consolidated revenues from 2023 to 2024 (in millions):
Consolidated revenues—2023
$ 22,855
Mining operations:
(Lower) higher sales volumes:
Copper
(73)
Gold
316
Molybdenum
(63)
Higher (lower) averaged realized prices:
Copper
1,464
Gold
836
Molybdenum
(225)
Adjustments for prior year provisionally priced copper sales
(155)
Higher Atlantic Copper revenues
207
Higher revenues from sales of purchased copper
277
Lower treatment charges
142
Higher export duties and royalties
(246)
Other, including intercompany eliminations
120
Consolidated revenues—2024
$ 25,455
Sales Volumes. Copper sales volumes in 2024 were slightly lower
than 2023, primarily reflecting lower ore grades and operating
rates in North America, partly offset by higher ore grades and
operating rates in Indonesia. Gold sales volumes were higher
in 2024, compared to 2023, primarily reflecting the timing of
shipments at PT-FI. Refer to “Operations” for further discussion
of sales volumes at our mining operations.
Realized Prices. Our consolidated revenues can vary significantly
as a result of fluctuations in the market prices of copper, gold and
molybdenum. In 2024, our average realized prices, compared with
2023, were 9% higher for copper, 23% higher for gold and 12%
lower for molybdenum.
Certain sales contracts for copper and gold provide final pricing
in a specified future month (generally one to four months from the
shipment date). We record revenues and invoice customers at
the time of shipment based on then-current LME or London PM
prices, which results in an embedded derivative on provisionally
priced sales that are adjusted to fair value through earnings each
period, using the period-end forward prices, until final pricing on
the date of settlement. To the extent final prices are higher or lower
than what was recorded on a provisional basis, an increase or
decrease to revenues is recorded each reporting period until the
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2024 Annual Report
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Depreciation, Depletion and Amortization
Depreciation will vary under the UOP method as a result of changes
in sales volumes and the related UOP rates at our mining operations.
Consolidated DD&A totaled $2.2 billion in 2024 and $2.1 billion in
2023. Our consolidated DD&A is estimated to approximate $2.5 billion
for the year 2025, based on current sales volume estimates. The
increase in 2025, compared to 2024, primarily reflects expected
completion of commissioning activities for PT-FI’s new downstream
processing facilities.
Environmental Obligations and Shutdown Costs
Environmental obligation costs reflect net revisions to our long-
term environmental obligations, which vary from period to period
because of changes to environmental laws and regulations, the
settlement of environmental matters and/or circumstances affecting
our operations that could result in significant changes in our
estimates (refer to “Critical Accounting Estimates—Environmental
Obligations” for further discussion). Shutdown costs include care-
and-maintenance costs and any litigation, remediation or related
expenditures associated with closed facilities or operations.
Net charges for environmental obligations and shutdown costs
totaled $127 million in 2024, including $82 million in net adjustments
to environmental obligations. Net charges totaled $319 million in
2023, including $195 million in net adjustments to environmental
obligations and $65 million associated with an adjustment to the
proposed settlement of talc-related litigation. Refer to Note 10 for
further discussion of environmental obligations and litigation matters.
Interest Expense, Net
Consolidated interest costs (before capitalization) totaled $710 million
in 2024 and $782 million in 2023. The year 2023 included $74 million of
interest charges associated with Cerro Verde’s contested tax rulings
issued by the Peru Supreme Court.
Capitalized interest totaled $391 million in 2024 and $267 million
in 2023. The increase in capitalized interest in 2024, compared
with 2023, resulted from construction and development projects in
process, primarily related to PT-FI’s new downstream processing
facilities. Refer to “Operations” and “Capital Resources and
Liquidity—Investing Activities” for further discussion of current
development projects.
Production and Delivery Costs
Consolidated production and delivery costs totaled $15.6 billion in
2024, compared with $13.6 billion in 2023. Higher production and
delivery costs in 2024 primarily reflect increased costs at PT-FI
associated with higher operating rates and sales volumes, and for
adjustments to its ARO (refer to Note 10 for discussion of Indonesia
reclamation and closure programs). Production and delivery costs
also include oil and gas charges totaling $217 million in 2024
and $70 million in 2023, mostly for impairments and assumed
abandonment obligations from bankruptcies of other companies
(refer to Note 10) and nonrecurring labor-related charges totaling
$97 million in 2024 associated with Cerro Verde’s new collective
labor agreements (CLA). Refer to Note 14 for details of production
and delivery costs by operating segment.
Mining Unit Site Production and Delivery Costs Per Pound. Site
production and delivery costs for our copper mining operations
primarily include labor, energy and other commodity-based inputs,
such as sulfuric acid, steel, reagents, liners, tires and explosives.
Consolidated unit site production and delivery costs (before net
noncash and other costs) for our copper mines averaged
$2.49 per pound of copper in 2024 and $2.36 per pound in 2023.
Refer to “Operations—Unit Net Cash Costs” for further discussion
of unit net cash costs associated with our operating divisions,
and to “Product Revenues and Production Costs” for reconciliations
of per pound costs by operating division to production and
delivery costs applicable to sales reported in our consolidated
financial statements.
Our copper mining operations require significant amounts
of energy, principally diesel, electricity, coal and natural gas, most
of which is obtained from third parties under long-term contracts.
Our take-or-pay contractual obligations for electricity totaled
approximately $0.2 billion at December 31, 2024. We do not have
take-or-pay contractual obligations for other energy commodities.
Energy represented 16% of our copper mine site operating costs
in 2024, including purchases of approximately 270 million gallons
of diesel fuel; approximately 8,550 gigawatt hours of electricity
at our North America and South America copper mining operations
(we generate all of our power at our Indonesia mining operation);
approximately 750 thousand metric tons of coal for our coal power
plant in Indonesia; and approximately 2 million MMBtu (million
British thermal units) of natural gas at certain of our North America
mines. Based on current cost estimates, energy will approximate
16% of our copper mine site operating costs for the year 2025.
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
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Income Taxes
Refer to Note 9, and Item 1A. “Risk Factors” contained in Part I of our
annual report on Form 10-K for the year ended December 31, 2024,
for further discussion of income taxes.
Following is a summary of the approximate amounts used in the
calculation of our consolidated income tax provision for the years
ended December 31 (in millions, except percentages):
Other Income, Net
Other income, net, which totaled $362 million in 2024 and $286 million
in 2023, primarily includes amounts associated with interest
income, currency exchange gains and losses, and mark-to-market
impacts of trust assets used to satisfy financial assurance
obligations for our New Mexico mining operations. The year 2024
also includes a credit of $26 million associated with the reduction
in the accrual to indemnify PT Mineral Industri Indonesia (MIND ID)
from potential losses arising from historical tax disputes, and the
year 2023 also includes a $69 million charge associated with Cerro
Verde’s contested tax rulings issued by the Peru Supreme Court.
Based on achievement of current sales volume and cost
estimates and assuming average prices of $4.00 per pound of
copper, $2,700 per ounce of gold and $20.00 per pound of
molybdenum for the year 2025, we estimate that net income
attributable to noncontrolling interests will approximate $2.3 billion
for the year 2025. The impact of price changes on net income
attributable to noncontrolling interests for the year 2025 would
approximate $0.2 billion for each $0.25 per pound change in
the average price of copper for the year 2025. The actual amount
will depend on many factors, including relative performance of each
business segment, commodity prices, costs and other factors.
OPERATIONS
Responsible Production
Refer to Items 1. and 2. “Business and Properties” and Item 1A.
“Risk Factors” contained in Part I of our annual report on Form 10-K
for the year ended December 31, 2024, for discussion of our
involvement with the International Council on Mining & Metals and
environmental (including climate) and social-related risks.
Assuming achievement of current sales volume and cost estimates
and average prices of $4.00 per pound for copper, $2,700 per ounce
for gold and $20.00 per pound for molybdenum, we estimate our
consolidated effective tax rate for the year 2025 would approximate
40%. Changes in projected sales volumes and average prices
during 2025 would incur tax impacts at estimated effective rates of
39% for Peru, 36% for Indonesia and 0% for the U.S., which excludes
any impacts from the Act.
Net Income Attributable to Noncontrolling Interests
Refer to Note 2 for ownership in our subsidiaries.
Net income attributable to noncontrolling interests, which is
primarily associated with PT-FI, Cerro Verde and El Abra, totaled
$2.5 billion in 2024 and $1.9 billion in 2023. In September 2024,
we increased our ownership interest in Cerro Verde to 55.08%
from 53.56%. Refer to Note 14 for net income attributable
to noncontrolling interests for each of our business segments.
2024
2023
Income Tax
Income Tax
Income
Effective
(Provision)
Income
Effective
(Provision)
(Loss)a
Tax Rate
Benefit
(Loss)a
Tax Rate
Benefit
U.S.b
$ (533)c
7%
$
36c
$ 55
—%d
$
1
South America
1,519
40%
(604)
1,303
40%
(515)
Indonesia
5,754
36%
(2,089)
4,830
37%
(1,771)
Cerro Verde historical tax matters
—
N/A
—
(142)e
N/A
3
PT-FI historical tax matters
16f
N/A
182f
(5)
N/A
(3)
Eliminations and other
151
N/A
(48)
(35)
N/A
15
Consolidated FCX
$ 6,907
37%
$ (2,523)
$6,006
38%
$ (2,270)
a. Represents income before income taxes, equity in affiliated companies’ net earnings and noncontrolling interests.
b. In addition to our North America mining operations, which had operating income of $0.8 billion in 2024 and $1.0 billion in 2023 (refer to Note 14), the U.S. jurisdiction reflects non-operating sites and corporate-level
expenses, which include interest expense associated with our senior notes and general and administrative expenses. The U.S. jurisdiction also includes net revisions to environmental obligation estimates and charges
associated with oil and gas abandonment obligations and impairments.
c. Includes net credits associated with the closure of our 2017 and 2018 U.S. federal income tax exams.
d. Includes a valuation allowance release on prior year unbenefited net operating losses.
e. Reflects net charges associated with contested tax rulings issued by the Peru Supreme Court.
f. Reflects net credits associated with closure of PT-FI’s 2021 corporate income tax audit and resolution of a framework for Indonesia disputed tax matters.
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
2024 Annual Report
37
We demonstrate our responsible production performance
through the Copper Mark, a comprehensive assurance framework
developed specifically for the copper industry, and recently
extended to other metals including molybdenum. To achieve the
Copper Mark, each site is required to complete an independent
external assurance process to assess conformance with various
environmental, social and governance criteria. Awarded sites must
be revalidated every three years. We have achieved, and are
committed to maintaining, the Copper Mark and/or Molybdenum
Mark, as applicable, at all of our operating sites globally.
Technology and Leaching Innovation Initiatives
We are progressing initiatives across our North America and
South America operations by incorporating new applications,
technologies and data analytics to our leaching processes. In late
2023, we achieved our initial incremental annual run rate target
of approximately 200 million pounds of copper. Incremental copper
production from these initiatives totaled 214 million pounds in
2024, compared with a total of 144 million pounds in 2023. We have
projects underway to apply recent operational enhancements to
our leaching processes on a larger scale and are testing new
innovative technology applications that we believe have the potential
for significant increases in recoverable metal from leach stockpiles
beyond the current run rate. Continued success with these
initiatives could contribute to favorable adjustments in recoverable
copper in certain leach stockpiles and positively impact average
unit net cash costs.
In addition to technology-driven leaching initiatives, we are
pursuing opportunities to leverage new technologies and analytic
tools in automation and operating practices with a goal of
improving operating efficiencies, and reducing costs and capital
intensity of our current operations and future development projects.
We believe these technology and leaching initiatives are particularly
important to our North America operations, which have lower
ore grades.
Feasibility and Optimization Studies
We are engaged in various studies associated with potential
future expansion projects primarily at our mining operations. The
costs for these studies are charged to production and delivery
costs as incurred and totaled $155 million in 2024 and $185 million
in 2023. We estimate the costs of these studies will approximate
$240 million for the year 2025, subject to market conditions and
other factors.
North America
We manage seven copper operations in North America—Morenci,
Bagdad, Safford (including Lone Star), Sierrita and Miami in
Arizona, and Chino and Tyrone in New Mexico. We also operate
a copper smelter in Miami, Arizona. All of the North America
operations are wholly owned, except for Morenci. We record our
72% undivided joint venture interest in Morenci using the
proportionate consolidation method.
The North America copper operations include open-pit
mining, sulfide-ore concentrating, leaching and solution extraction/
electrowinning (SX/EW) facilities. A majority of the copper
produced at our North America copper operations is cast into
copper rod by our Rod & Refining segment. The remainder of our
North America copper production is sold as copper cathode or
copper concentrate, a portion of which is shipped to Atlantic Copper
(our wholly owned smelter and refinery in Spain). Molybdenum
concentrate, gold and silver are also produced by certain of our
North America copper operations.
Development Activities. Refer to Item 1A. “Risk Factors” contained
in Part I of our annual report on Form 10-K for the year ended
December 31, 2024, for further discussion of risks associated with
development projects.
We have substantial reserves and future opportunities in the U.S.,
primarily associated with existing mining operations.
We have a potential expansion project to more than double the
concentrator capacity of the Bagdad operation in northwest Arizona.
Bagdad’s reserve life currently exceeds 80 years and supports an
expanded operation. In late 2023, we completed technical and
economic studies, which indicate the opportunity to construct new
concentrating facilities to increase copper production by 200 to
250 million pounds per year at estimated incremental project capital
costs of approximately $3.5 billion. Expanded operations would
provide improved efficiency and reduce unit net cash costs through
economies of scale. Project economics indicate that the expansion
would require an incentive copper price in the range of $3.50 to
$4.00 per pound and approximately three to four years to complete.
The decision of whether to proceed and timing of the potential
expansion will take into account overall copper market conditions,
availability of labor and other factors, including deployment of our
autonomous haul truck fleet conversion expected by year-end
2025 and expanding housing alternatives to support long-range
plans. In parallel, we are enhancing local infrastructure and
advancing activities for expanded tailings infrastructure projects
required under long-range plans in order to advance the potential
construction timeline.
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Our consolidated copper production and sales volumes from
the North America copper mines in 2024 were below 2023 volumes,
primarily reflecting lower ore grades and operating rates, partly
offset by leach recovery initiatives.
North America copper sales are estimated to approximate 1.4 billion
pounds in 2025. Refer to “Outlook” for projected molybdenum
sales volumes.
Unit Net Cash Costs. We believe unit net cash costs per pound of
copper is a measure that provides investors with information about
the cash-generating capacity of our mining operations expressed
on a basis relating to the primary metal product for our respective
operations. We use this measure for the same purpose and for
monitoring operating performance by our mining operations. This
information differs from measures of performance determined in
accordance with U.S. GAAP and should not be considered in isolation
or as a substitute for measures of performance determined in
accordance with U.S. GAAP. This measure is presented by other
metals mining companies, although our measure may not be
comparable to similarly titled measures reported by other companies.
Gross Profit per Pound of Copper and Molybdenum. The following
table summarizes unit net cash costs and gross profit per pound
at our North America copper mines for the two years ended
December 31, 2024. Refer to “Product Revenues and Production
Costs” for an explanation of the “by-product” and “co-product”
methods and a reconciliation of unit net cash costs per pound to
production and delivery costs applicable to sales reported in our
consolidated financial statements.
We have commenced pre-feasibility studies in the Lone Star
district of Safford to define a potential significant expansion
opportunity. Positive drilling conducted in recent years indicates a
large, mineralized district with opportunities to pursue a further
expansion project. We expect to complete these studies in 2026.
The decision of whether to proceed and timing of the potential
expansion will take into account results of technical and economic
studies, overall copper market conditions and other factors.
Operating Data. Following is summary operating data for the
North America copper mines for the years ended December 31:
2024
2023
Operating Data, Net of Joint Venture Interests
Copper (millions of recoverable pounds)
Production
1,246
1,350
Sales, excluding purchases
1,257
1,361
Average realized price per pound
$
4.29
$
3.93
Molybdenum (millions of recoverable pounds)
Productiona
30
30
100% Operating Data
Leach operations
Leach ore placed in stockpiles (metric tons per day)
609,400
692,000
Average copper ore grade (%)
0.20
0.23
Copper production (millions of recoverable pounds)
842
941
Mill operations
Ore milled (metric tons per day)
311,700
308,500
Average ore grade (%):
Copper
0.30
0.32
Molybdenum
0.02
0.02
Copper recovery rate (%)
83.2
81.8
Copper production (millions of recoverable pounds)
601
633
a. Refer to “Consolidated Results” for our consolidated molybdenum sales volumes, which include
sales of molybdenum produced at the North America copper mines.
2024
2023
By-Product
Co-Product Method
By-Product
Co-Product Method
Method
Copper
Molybdenuma
Method
Copper
Molybdenuma
Revenues, excluding adjustments
$ 4.29
$ 4.29
$ 20.13
$ 3.93
$ 3.93
$ 23.38
Site production and delivery, before net noncash
and other costs shown below
3.46
3.10
16.20
3.00
2.65
17.63
By-product credits
(0.48)
—
—
(0.49)
—
—
Treatment charges
0.13
0.12
—
0.12
0.12
—
Unit net cash costs
3.11
3.22
16.20
2.63
2.77
17.63
DD&A
0.34
0.31
1.19
0.30
0.27
1.30
Noncash and other costs, net
0.19b
0.18
0.36
0.18b
0.16
0.77
Total unit costs
3.64
3.71
17.75
3.11
3.20
19.70
Revenue adjustments, primarily for pricing
on prior period open sales
—
—
—
0.01
0.01
—
Gross profit per pound
$ 0.65
$ 0.58
$ 2.38
$ 0.83
$ 0.74
$ 3.68
Copper sales (millions of recoverable pounds)
1,263
1,263
1,367
1,367
Molybdenum sales (millions of recoverable pounds)a
30
30
a. Reflects sales of molybdenum produced by certain of the North America copper mines to our molybdenum sales company at market-based pricing.
b. Includes charges totaling $0.05 per pound of copper in 2024 and $0.08 per pound of copper in 2023 for feasibility and optimization studies. Also, includes charges totaling $0.05 per pound of copper in 2024 and
$0.01 per pound of copper in 2023 for metals inventory adjustments.
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
2024 Annual Report
39
At the El Abra operations in Chile, we have completed substantial
drilling and evaluations to define a large sulfide resource that would
support a potential major mill project similar to the large-scale
concentrator at Cerro Verde. We are preparing data for a potential
submission of an environmental impact statement by year-end
2025, subject to ongoing stakeholder engagement and economic
evaluations. Preliminary estimates, which remain under review,
indicate that the project economics would be supported using an
incentive copper price of less than $4.00 per pound. The decision of
whether to proceed and timing of the potential project will take
into account overall copper market conditions, required permitting
and other factors.
Operating Data. Following is summary consolidated operating
data for our South America operations for the years ended
December 31.
2024
2023
Copper (millions of recoverable pounds)
Production
1,168
1,202
Sales
1,177
1,200
Average realized price per pound
$
4.16
$
3.82
Molybdenum (millions of recoverable pounds)
Productiona
20
22
Leach operations
Leach ore placed in stockpiles (metric tons per day)
164,300
191,200
Average copper ore grade (%)
0.42
0.35
Copper production (millions of recoverable pounds)
295
317
Mill operations
Ore milled (metric tons per day)
415,500
417,400
Average ore grade (%):
Copper
0.33
0.34
Molybdenum
0.01
0.01
Copper recovery rate (%)
83.6
81.3
Copper production (millions of recoverable pounds)
873
885
a. Refer to “Consolidated Results” for our consolidated molybdenum sales volumes, which include sales
of molybdenum produced at Cerro Verde.
Our consolidated copper production and sales volumes from our
South America operations in 2024 were slightly lower than 2023
volumes, primarily reflecting lower operating rates, offset by higher
ore grades.
South America copper sales volumes are expected to approximate
1.1 billion in 2025 as a result of slightly lower expected ore grades.
Refer to “Outlook” for projected molybdenum sales volumes.
Unit Net Cash Costs. We believe unit net cash costs per pound of
copper is a measure that provides investors with information about
the cash-generating capacity of our mining operations expressed
on a basis relating to the primary metal product for our respective
operations. We use this measure for the same purpose and for
monitoring operating performance by our mining operations. This
Our North America copper mines have varying cost structures
because of differences in ore grades and characteristics,
processing costs, by-product credits and other factors. Average
unit net cash costs (net of by-product credits) for the North
America copper mines of $3.11 per pound of copper in 2024 were
higher than average unit net cash costs of $2.63 per pound of
copper in 2023, primarily reflecting lower copper volumes and
higher mining and labor costs.
Because certain assets are depreciated on a straight-line basis,
North America’s average unit depreciation rate may vary with asset
additions and the level of copper production and sales.
Revenue adjustments primarily result from changes in prices on
provisionally priced copper sales recognized in prior periods.
Refer to “Consolidated Results—Revenues” for further discussion
of adjustments to prior period provisionally priced copper sales.
Average unit net cash costs (net of by-product credits) for the
North America copper mines are expected to approximate $3.00 per
pound of copper for the year 2025, based on achievement of
current sales volume and cost estimates and assuming an average
price of $20.00 per pound of molybdenum. North America’s
average unit net cash costs for the year 2025 would change by
approximately $0.05 per pound for each $2 per pound change in
the average price of molybdenum.
SOUTH AMERICA
We manage two copper operations in South America—Cerro Verde
in Peru (in which we own a 55.08% interest) and El Abra in Chile
(in which we own a 51% interest), which are consolidated in our
financial statements.
In September 2024, we purchased 5.3 million shares of Cerro
Verde common stock for $210 million, increasing our ownership
interest in Cerro Verde to 55.08% from 53.56%.
South America operations includes open-pit mining, sulfide-ore
concentrating, leaching and SX/EW facilities. Production from
our South America operations is sold as copper concentrate or
cathode under long-term contracts.
Our South America operations also sell a portion of their
copper concentrate production to Atlantic Copper. In addition to
copper, the Cerro Verde mine produces molybdenum concentrate
and silver.
Development Activities. Refer to Item 1A. “Risk Factors” contained
in Part I of our annual report on Form 10-K for the year ended
December 31, 2024, for further discussion of risks associated with
development projects.
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
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Freeport | Powering Progress
Revenues from Cerro Verde’s copper concentrate sales are
recorded net of treatment charges, which will vary with Cerro Verde’s
sales volumes and the price of copper.
Because certain assets are depreciated on a straight-line basis,
South America’s unit depreciation rate may vary with asset additions
and the level of copper production and sales.
Revenue adjustments primarily result from changes in prices on
provisionally priced copper sales recognized in prior periods.
Refer to “Consolidated Results—Revenues” for further discussion
of adjustments to prior period provisionally priced copper sales.
Average unit net cash costs (net of by-product credits) for South
America operations are expected to approximate $2.50 per pound
of copper for the year 2025, based on achievement of current sales
volume and cost estimates and assuming an average price of
$20.00 per pound of molybdenum.
Indonesia
PT-FI operates one of the world’s largest copper and gold mines at
the Grasberg minerals district in Central Papua, Indonesia. PT-FI
produces copper concentrate that contains significant quantities of
gold and silver. We have a 48.76% ownership interest in PT-FI and
manage its operations. PT-FI’s results are consolidated in our
financial statements. Once the full ramp-up of the new downstream
processing facilities is achieved, PT-FI will be a fully integrated
producer of refined copper and gold.
Concentrate Exports. Current regulations in Indonesia prohibit
exports of copper concentrate as of January 1, 2025. Pursuant to the
terms of its special mining business license (IUPK) regarding force
majeure events, PT-FI has requested approval from the Indonesia
government to permit the export of copper concentrate in 2025 until
the required repairs of its new smelter following the October 2024
fire incident (see below for further discussion) and full ramp-up are
complete. Based on discussions with the Indonesia government,
PT-FI expects to re-commence exports of copper concentrate
during first-quarter 2025, and pursuant to current regulations,
would be required to pay a 7.5% export duty on copper concentrate
exports during 2025.
Refer to Notes 10 and 11 for further discussion of Indonesia
regulatory matters, including its IUPK, export proceeds and
export duties.
Long-Term Mining Rights. Pursuant to regulations issued during
2024, PT-FI is eligible to apply for an extension of its mining rights
beyond 2041, provided certain conditions are met, including
ownership of integrated downstream facilities that have entered the
operational stage; domestic ownership of at least 51% and
agreement with a state-owned enterprise for an additional 10%
information differs from measures of performance determined in
accordance with U.S. GAAP and should not be considered in
isolation or as a substitute for measures of performance determined
in accordance with U.S. GAAP. This measure is presented by
other metals mining companies, although our measure may not be
comparable to similarly titled measures reported by other companies.
Gross Profit per Pound of Copper. The following table summarizes
unit net cash costs and gross profit per pound of copper at our
South America operations for the two years ended December 31,
2024. Unit net cash costs per pound of copper are reflected under
the by-product and co-product methods as the South America
operations also had sales of molybdenum and silver. Refer to
“Product Revenues and Production Costs” for an explanation of the
“by-product” and “co-product” methods and a reconciliation of
unit net cash costs per pound to production and delivery costs
applicable to sales reported in our consolidated financial statements.
2024
2023
By-Product Co-Product By-Product Co-Product
Method
Method
Method
Method
Revenues, excluding
adjustments
$ 4.16
$ 4.16
$ 3.82
$ 3.82
Site production and delivery,
before net noncash and
other costs shown below
2.63
2.43
2.57
2.34
By-product credits
(0.34)
—
(0.39)
—
Treatment charges
0.16
0.16
0.19
0.19
Royalty on metals
0.01
0.01
0.01
0.01
Unit net cash costs
2.46
2.60
2.38
2.54
DD&A
0.38
0.35
0.38
0.35
Noncash and other costs, net
0.08a
0.07
0.08a
0.07
Total unit costs
2.92
3.02
2.84
2.96
Revenue adjustments,
primarily for pricing on
prior period open sales
0.03
0.03
0.06
0.06
Gross profit per pound
$ 1.27
$ 1.17
$ 1.04
$ 0.92
Copper sales (millions of
recoverable pounds)
1,177
1,177
1,200
1,200
a. Includes $0.05 per pound of copper in 2024 and $0.04 per pound of copper in 2023 for feasibility
and optimization studies.
Our South America operations have varying cost structures
because of differences in ore grades and characteristics, processing
costs, by-product credits and other factors. Average unit net
cash costs (net of by-product credits) for South America operations
of $2.46 per pound of copper in 2024 were higher than average
unit net cash costs of $2.38 per pound in 2023, primarily reflecting
charges totaling $97 million ($0.08 per pound of copper) associated
with nonrecurring labor-related charges at Cerro Verde
associated with new multi-year CLAs with its two unions and
lower by-product credits.
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2024 Annual Report
41
represents an incremental cost of $0.4 billion compared to
previously planned investments to refurbish the existing coal units.
Once complete, PT-FI’s dual-fuel power plant and the new gas-
fired combined cycle facility will be fueled by natural gas, supplied
by a floating liquefied natural gas storage and regassification unit.
Downstream Processing Facilities. New Smelter. Construction of
the new greenfield smelter in Eastern Java, Indonesia was completed
during 2024. In October 2024, during start-up activities, a fire
occurred that required a temporary suspension of smelting operations
to complete repairs. Procurement of long-lead items is advanced
and repairs are scheduled to be completed by mid-2025, and
PT-FI expects ramp-up to full capacity to be achieved by year-end
2025. PT-FI expects restoration, repair and replacement costs to
approximate $100 million, which are expected to be mostly offset
through recovery under construction insurance programs.
PMR. As part of start-up activities, PT-FI commenced gold
production at its new PMR in December 2024. The facility has capacity
to refine all precious metals from PT-FI’s new smelter as well
as from PT Smelting, PT-FI’s 66%-owned smelter and refinery in
Gresik, Indonesia.
Refer to “Smelting and Refining” and Note 2 for further discussion
of PT Smelting.
Operating Data. Following is summary consolidated operating data
for Indonesia operations for the years ended December 31.
2024
2023
Operating Data
Copper (millions of recoverable pounds)
Production
1,800
1,660
Sales
1,632
1,525
Average realized price per pound
$
4.19
$
3.81
Gold (thousands of recoverable ounces)
Production
1,861
1,978
Sales
1,817
1,697
Average realized price per ounce
$
2,418
$ 1,972
Ore extracted and milled (metric tons per day):
Grasberg Block Cave underground mine
133,800
117,300
DMLZ underground mine
64,900
75,900
Big Gossan underground mine
8,000
7,900
Other adjustments
1,700
(2,800)
Total
208,400
198,300
Average ore grade:
Copper (%)
1.27
1.22
Gold (grams per metric ton)
1.00
1.12
Recovery rates (%):
Copper
88.4
89.7
Gold
76.9
77.9
Higher consolidated copper and gold sales volumes in 2024,
compared with 2023, primarily reflected higher mining and milling
rates, higher copper ore grades and the timing of shipments.
ownership; and commitments for additional exploration and
increases in refining capacity, each as approved by the Ministry of
Energy and Mineral Resources. Application for extension may be
submitted at any time up to one year prior to the expiration of PT-FI’s
IUPK. PT-FI expects to apply for an extension during 2025, pending
agreement with MIND ID on a purchase and sale agreement for the
transfer in 2041 of an additional 10% interest in PT-FI.
An extension would enable continuity of large-scale operations
for the benefit of all stakeholders and provide growth options
through additional resource development opportunities in the
highly attractive Grasberg minerals district.
Operating and Development Activities. Refer to Item 1A. “Risk
Factors” contained in Part I of our annual report on Form 10-K for
the year ended December 31, 2024, for further discussion of risks
associated with development projects.
Over a multi-year investment period, PT-FI has successfully
commissioned three large-scale underground mines in the
Grasberg minerals district (Grasberg Block Cave, Deep Mill Level
Zone (DMLZ) and Big Gossan). Milling rates for ore from these
underground mines averaged 208,400 metric tons of ore per day
in 2024 and 198,300 metric tons of ore per day in 2023. In
December 2024, PT-FI completed construction of a new copper
cleaner circuit, a mill recovery project to enhance recoveries and
optimize concentrate production, with commissioning underway.
Kucing Liar. Long-term mine development activities are ongoing
for PT-FI’s Kucing Liar deposit in the Grasberg minerals district.
Kucing Liar is expected to produce over 7 billion pounds of copper
and 6 million ounces of gold between 2029 and the end of 2041,
and an extension of PT-FI’s operating rights beyond 2041 would
extend the life of the project. Development activities commenced
in 2022 and are expected to continue over an approximate 10-year
timeframe. Capital investments for Kucing Liar are estimated to
total $4 billion over the next seven to eight years (averaging
approximately $0.5 billion per annum). Approximately $0.6 billion
has been incurred through December 31, 2024. At full operating
rates, annual production from Kucing Liar is expected to
approximate 560 million pounds of copper and 520 thousand
ounces of gold, providing PT-FI with sustained long-term, large-
scale and low-cost production. Kucing Liar will benefit from
substantial shared infrastructure and PT-FI’s experience and
long-term success in block-cave mining.
Natural Gas Facilities. PT-FI plans to transition its existing energy
source from coal to natural gas, which would meaningfully reduce
PT-FI’s Scope 1 greenhouse gas emissions at the Grasberg
minerals district. The majority of PT-FI’s planned investments in a
new gas-fired combined cycle facility are expected to be incurred
over the next three years, at a cost of approximately $1 billion, which
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with information about the cash-generating capacity of our mining
operations expressed on a basis relating to the primary metal
product for our respective operations. We use this measure for the
same purpose and for monitoring operating performance by our
mining operations. This information differs from measures of
performance determined in accordance with U.S. GAAP and should
not be considered in isolation or as a substitute for measures of
performance determined in accordance with U.S. GAAP. This
measure is presented by other metals mining companies, although
our measure may not be comparable to similarly titled measures
reported by other companies.
Gross Profit per Pound of Copper and per Ounce of Gold. The
following table summarizes the unit net cash (credits) costs and
gross profit per pound of copper and per ounce of gold at our
Indonesia mining operations for the two years ended December 31,
2024. Refer to “Product Revenues and Production Costs” for an
explanation of “by-product” and “co-product” methods and a
reconciliation of unit net cash costs per pound to production and
delivery costs applicable to sales reported in our consolidated
financial statements.
PT-FI’s consolidated copper production volumes for 2024
exceeded sales volumes, reflecting an increase in concentrate
inventory held at PT-FI’s new downstream processing facilities
expected to be sold as refined metal in the second half of 2025.
PT-FI’s consolidated copper and gold production volumes for
2023 exceeded sales volumes, reflecting the deferral of sales
recognition related to the PT Smelting tolling arrangement (as
discussed below and in Note 2).
Consolidated sales volumes from PT-FI are expected to
approximate 1.55 billion pounds of copper and 1.6 million ounces
of gold in 2025. PT-FI’s projected sales volumes in 2025 reflect
reduced operating rates associated with two major maintenance
projects in its concentrating facilities. Projected sales volumes are
dependent on operational performance; Indonesia regulatory
approval to export copper concentrate until repairs and full
ramp-up of PT-FI’s new smelter are complete; weather-related
conditions; and other factors detailed in the “Cautionary
Statement” below.
Unit Net Cash (Credits) Costs. We believe unit net cash (credits)
costs per pound of copper is a measure that provides investors
2024
2023
By-Product
Co-Product Method
By-Product
Co-Product Method
Method
Copper
Gold
Method
Copper
Gold
Revenues, excluding adjustments
$ 4.19
$ 4.19
$ 2,418
$ 3.81
$ 3.81
$ 1,972
Site production and delivery, before net noncash
and other costs shown below
1.64
0.98
566
1.62
1.01
522
Gold, silver and other by-product credits
(2.82)
—
—
(2.30)
—
—
Treatment charges
0.35
0.21
120
0.35
0.22
114
Export duties
0.28
0.17
96
0.21
0.13
69
Royalty on metals
0.27
0.16
92
0.22
0.14
71
Unit net cash (credits) costs
(0.28)
1.52
874
0.10
1.50
776
DD&A
0.73
0.44
252
0.68
0.42
218
Noncash and other costs, net
0.22a
0.13
77
0.01b
0.01
5
Total unit costs
0.67
2.09
1,203
0.79
1.93
999
Revenue adjustments, primarily for pricing on
prior period open sales
0.01
0.01
(2)
0.08
0.07
9
PT Smelting intercompany profit
—
—
—
0.07
0.05
24
Gross profit per pound/ounce
$ 3.53
$ 2.11
$ 1,213
$ 3.17
$ 2.00
$ 1,006
Copper sales (millions of recoverable pounds)
1,632
1,632
1,525
1,525
Gold sales (thousands of recoverable ounces)
1,817
1,697
a. Includes charges of $0.09 per pound of copper associated with ARO adjustments, $0.08 per pound of copper for operational readiness and start-up costs associated with PT-FI’s new downstream processing
facilities, $0.02 per pound of copper for amounts capitalized in prior years associated with construction of PT-FI’s new downstream processing facilities and $0.02 per pound of copper for feasibility and
optimization studies.
b. Includes credits of $0.07 per pound of copper associated with ARO adjustments, and charges of $0.04 per pound of copper associated with an administrative fine and $0.02 per pound of copper for feasibility
and optimization studies.
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43
Molybdenum Mines
We operate two wholly owned primary molybdenum operations
in Colorado—the Climax open-pit mine and the Henderson
underground mine. The Climax and Henderson mines produce
high-purity, chemical-grade molybdenum concentrate, which is
typically further processed into value-added molybdenum chemical
products. The majority of the molybdenum concentrate produced
at the Climax and Henderson mines, as well as from our North
America copper mines and South America operations, is processed
at our conversion facilities.
Operating and Development Activities. Production from the
Molybdenum mines totaled 30 million pounds of molybdenum in
both 2024 and 2023. Refer to “Consolidated Results” for our
consolidated molybdenum operating data, which includes sales
of molybdenum produced at our primary molybdenum operations
and from our North America copper mines and South America
operations. Refer to “Outlook” for projected consolidated
molybdenum sales volumes and to “Markets” for a discussion of
molybdenum prices.
Unit Net Cash Costs per Pound of Molybdenum. We believe unit net
cash costs per pound of molybdenum is a measure that provides
investors with information about the cash-generating capacity of our
mining operations expressed on a basis relating to the primary
metal product for our respective operations. We use this measure
for the same purpose and for monitoring operating performance by
our mining operations. This information differs from measures of
performance determined in accordance with U.S. GAAP and should
not be considered in isolation or as a substitute for measures of
performance determined in accordance with U.S. GAAP. This
measure is presented by other metals mining companies, although
our measure may not be comparable to similarly titled measures
reported by other companies.
Average unit net cash costs for our Molybdenum mines of
$17.89 per pound of molybdenum in 2024 were higher than $15.13 per
pound of molybdenum in 2023, primarily reflecting contract labor
transition costs. Average unit net cash costs for the Molybdenum
mines are expected to approximate $15.20 per pound of
molybdenum for the year 2025, based on achievement of current
sales volumes and cost estimates. Refer to “Product Revenues and
Production Costs” for a reconciliation of unit net cash costs per
pound to production and delivery costs applicable to sales reported
in our consolidated financial statements.
A significant portion of PT-FI’s costs are fixed and unit costs vary
depending on volumes and other factors. PT-FI’s unit net cash
credits (including gold, silver and other by-product credits) of
$0.28 per pound of copper in 2024 were favorable compared to the
unit net cash costs (net of gold, silver and other by-product
credits) of $0.10 per pound of copper in 2023, primarily reflecting
higher gold credits and higher copper volumes.
Treatment charges vary with the volume of metals sold and
the price of copper, and royalties vary with the volume of metals
sold and the prices of copper and gold. PT-FI royalties totaled
$433 million in 2024 and $338 million in 2023.
Export duties totaled $457 million in 2024 and $324 million in
2023. Refer to Note 11 for further discussion of PT-FI’s export duties.
Because certain assets are depreciated on a straight-line
basis, PT-FI’s unit depreciation rate may vary with asset additions
and the level of copper volumes and changes in copper and
gold inventory.
Revenue adjustments primarily result from changes in prices on
provisionally priced copper sales recognized in prior periods.
Refer to “Consolidated Results—Revenues” for further discussion
of adjustments to prior period provisionally priced copper sales.
As discussed in Note 2, beginning in 2023, PT-FI’s commercial
arrangement with PT Smelting changed from a copper concentrate
sales agreement to a tolling arrangement and there are no further
sales from PT-FI to PT Smelting. PT Smelting’s intercompany profit
for 2023 represents the change in the deferral of PT-FI’s profit on
prior sales to PT Smelting.
Average unit net cash credits (including gold, silver and other
by-product credits) for PT-FI are expected to approximate $0.27 per
pound of copper for the year 2025, based on achievement of
current sales volumes (including estimates for copper concentrate
exports) and cost estimates and assuming an average price of
$2,700 per ounce of gold. PT-FI’s average unit net cash costs for the
year 2025 would change by approximately $0.09 per pound of copper
for each $100 per ounce change in the average price of gold.
PT-FI’s projected sales volumes and unit net cash costs for the
year 2025 are dependent on operational performance; Indonesia
regulatory approval to export copper concentrate until repairs
and full ramp-up of PT-FI’s new smelter are complete; weather-
related conditions; timing of shipments; and other factors. Refer
to “Cautionary Statement” below, and Item 1A. “Risk Factors”
contained in Part I of our annual report on Form 10-K for the year
ended December 31, 2024, for further discussion of factors
that could cause results to differ materially from projections.
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are less significantly affected by changes in treatment charges
because these operations are largely integrated with our Miami
smelter and El Paso refinery.
We defer recognizing profits on sales from our mining
operations to Atlantic Copper until final sales to third parties
occur. Changes in these deferrals attributable to variability
in intercompany volumes resulted in net additions (reductions)
to operating income totaling $21 million ($(3) million to net income
attributable to common stock) in 2024 and $64 million ($37 million
to net income attributable to common stock) in 2023. Our
net deferred profits on our inventories at Atlantic Copper to be
recognized in future periods’ operating income totaled $181 million
($60 million to net income attributable to common stock) at
December 31, 2024. Quarterly variations in ore grades, the timing of
intercompany shipments and changes in product prices will result
in variability in our net deferred profits and quarterly earnings.
In May 2024, the U.S. Environmental Protection Agency (EPA)
amended its rule establishing standards for hazardous air pollutant
emissions from primary copper smelters. This final rule will impact
our Miami, Arizona smelter operations, which process a significant
portion of the copper concentrate produced by our North America
copper mines. We are evaluating processes and equipment
modifications and the costs involved, which could be significant in
connection with the revised rule requirements. Our appeal of
EPA’s final rule to the Court of Appeals for the District of Columbia
Circuit is suspended, pending resolution of several petitions for
reconsideration to EPA filed by us and other parties. Refer to
“Governmental Regulations—Environmental Matters” in Items 1 and 2.
“Business and Properties” and Item 1A. “Risk Factors” contained
in Part I of our annual report on Form 10-K for the year ended
December 31, 2024, for additional information on new and revised
environmental regulatory requirements that may result in substantial
increased costs for our business.
CAPITAL RESOURCES AND LIQUIDITY
Our consolidated operating cash flows vary with sales volumes;
prices realized from copper, gold and molybdenum sales;
production costs; income taxes; other working capital changes;
and other factors. See “Consolidated Results,” and Item 1A.
“Risk Factors” contained in Part I of our annual report on Form 10-K
for the year ended December 31, 2024, for further discussion of
our energy requirements and related costs.
We remain focused on managing costs efficiently and continue
to advance several important value-enhancing initiatives. We
believe the actions we have taken in recent years to build a solid
balance sheet, successfully expand low-cost operations and
maintain flexible organic growth options while maintaining
sufficient liquidity, will allow us to continue to execute our business
Smelting and Refining
Through our downstream integration, we are able to assure placement
of a significant portion of our copper concentrate production.
PT-FI wholly owns and operates its new downstream facilities in
Eastern Java, Indonesia, and has a 66% ownership interest in
PT Smelting (39.5% prior to June 30, 2024), which is operated by
Mitsubishi Materials Corporation (refer to Note 2 for further
discussion of PT Smelting). We wholly own and operate the Miami
smelter in Arizona, the El Paso refinery in Texas, and Atlantic
Copper smelter and refinery in Huelva, Spain.
During 2024, PT-FI completed construction of its new downstream
processing facilities. In October 2024, during start-up activities
of the new smelter, a fire occurred requiring a temporary suspension
of smelting operations to complete repairs (for further discussion
refer to “Operations—Indonesia—Downstream Processing
Facilities”). The new smelter will smelt and refine copper concentrate
from PT-FI and the PMR, which commenced gold production as
part of start-up activities in December 2024, will process anode
slimes from the new smelter and PT Smelting. Once its new
downstream processing facilities are operational, PT-FI’s
operations will be fully integrated and treatment charges reflecting
the cost of smelting and refining operations will be recorded in
production and delivery costs.
PT-FI recorded charges for operational readiness and start-up
costs associated with the new downstream processing facilities
totaling $133 million in 2024. We estimate that operational
readiness and start-up costs associated with the new downstream
processing facilities will approximate $120 million for the year 2025.
The Miami smelter has been operating for over 100 years and
has been upgraded numerous times during that period to
implement new technologies, improve production and comply with
air quality requirements. Major maintenance turnarounds are
anticipated to occur approximately every three to four years for the
Miami smelter. We performed a major maintenance turnaround for
the Miami smelter during 2021 and the next major maintenance
turnaround is scheduled for mid-year 2025, for which we expect to
incur maintenance charges and idle facility costs of approximately
$85 million.
Atlantic Copper smelts and refines copper concentrate and
markets refined copper and precious metals in slimes. During the
year 2024, Atlantic Copper’s copper concentrate purchases included
30% from our copper mining operations and 70% from third
parties. Atlantic Copper’s treatment charges, which consist of a
base rate per pound of copper and per ounce of gold, are
generally fixed and represent a cost to our mining operations and
income to Atlantic Copper (i.e., higher treatment charges benefit
our Atlantic Copper operations). Our North America copper mines
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2024 Annual Report
45
quarterly variable, performance-based cash dividend), which was
paid on February 3, 2025, to shareholders of record as of January 15,
2025. The declaration and payment of dividends (base or variable)
are at the discretion of our Board and will depend on our financial
results, cash requirements, global economic conditions and other
factors deemed relevant by our Board.
During 2024 we acquired 1.2 million shares of our common stock
for a total cost of $59 million ($50.48 average cost per share)
bringing total purchases under our $5.0 billion share repurchase
program to 49.0 million shares for a cost of $1.9 billion ($38.64 average
cost per share). The timing and amount of share repurchases are
at the discretion of management and will depend on a variety of
factors. The share repurchase program may be modified, increased,
suspended or terminated at any time at the Board’s discretion.
Refer to Item 1A. “Risk Factors” contained in Part I of our annual
report on Form 10-K for the year ended December 31, 2024, and
“Cautionary Statement” below for further discussion.
Cash
Following is a summary of the U.S. and international components of
consolidated cash and cash equivalents available to the parent
company, net of noncontrolling interests’ share and withholding
taxes, at December 31, 2024 (in billions):
Cash at domestic companies
$ 1.5
Cash at international operations
2.4a
Total consolidated cash and cash equivalents
3.9
Noncontrolling interests’ share
(1.1)
Cash, net of noncontrolling interests’ share
2.8
Withholding taxes
(0.1)
Net cash available
$ 2.7
a. Excludes $0.7 billion of current restricted cash associated with a portion of PT-FI’s export proceeds
required to be temporarily deposited in Indonesia banks for 90 days in accordance with a regulation
issued by the Indonesia government (refer to Note 10).
Cash held at our international operations is generally used to support
our foreign operations’ capital expenditures, operating expenses,
debt repayments, working capital or other cash needs. Management
believes that sufficient liquidity is available in the U.S. from cash
balances and availability from our revolving credit facility. We have
not elected to permanently reinvest earnings from our foreign
subsidiaries, and we have recorded deferred tax liabilities for foreign
earnings that are available to be repatriated to the U.S. From time
to time, our foreign subsidiaries distribute earnings to the U.S.
through dividends that are subject to applicable withholding taxes
and noncontrolling interests’ share. See Item 1A. “Risk Factors”
contained in Part I of our annual report on Form 10-K for the year
ended December 31, 2024, for further discussion of our holding
company structure and the potential impact of changes in tax laws.
plans in a prudent manner during periods of economic uncertainty
while preserving substantial future asset values. We closely
monitor market conditions and will adjust our operating plans to
protect liquidity and preserve our asset values, if necessary. We
expect to maintain a strong balance sheet and liquidity position as
we focus on building long-term value in our business, executing
our operating plans safely, responsibly and efficiently, and prudently
managing costs and capital expenditures.
Based on current sales volume, cost and metal price estimates
and planned capital expenditures discussed in “Outlook,” our
available cash and cash equivalents plus our projected consolidated
operating cash flows of $6.2 billion for the year 2025 exceed our
expected consolidated capital expenditures of $5.0 billion. We have
cash on hand and the financial flexibility to fund capital expenditures
and our other cash requirements for the next twelve months,
including noncontrolling interest distributions, income tax payments,
current common stock dividends (base and variable) and any share
or debt repurchases. Planned capital expenditures for major mining
projects over the next few years are primarily associated with
underground mine development in the Grasberg minerals district
and potential expansion projects in North America. At December 31,
2024, we had $3.9 billion of consolidated cash and cash equivalents
($4.7 billion including $0.7 billion of current restricted cash
associated with a portion of PT-FI’s export proceeds required to
be temporarily deposited in Indonesia banks), and FCX, PT-FI
and Cerro Verde have $3.0 billion, $1.5 billion and $350 million,
respectively, available under their revolving credit facilities.
Financial Policy. Our financial policy is aligned with our strategic
objectives of maintaining a solid balance sheet, providing cash
returns to shareholders and advancing opportunities for future
growth. The policy includes a base dividend and a performance-
based payout framework, whereby up to 50% of available cash
flows generated after planned capital spending and distributions to
noncontrolling interest would be allocated to shareholder returns
and the balance to debt reduction and investments in value
enhancing growth projects, subject to us maintaining our net debt
at a level not to exceed the net debt target of $3.0 billion to
$4.0 billion (excluding debt for PT-FI’s new downstream processing
facilities). Our Board reviews the structure of the performance-
based payout framework at least annually.
At December 31, 2024, our net debt, excluding $3.2 billion of debt
for PT-FI’s new downstream processing facilities, totaled $1.06 billion.
Refer to “Net Debt” for further discussion.
On December 18, 2024, our Board declared cash dividends
totaling $0.15 per share on our common stock (including a $0.075
per share quarterly base cash dividend and a $0.075 per share
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
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Financing Activities
Debt Transactions. Net repayments of debt totaled $0.5 billion in
2024, including the repayment of our 4.55% Senior Notes that
matured in November 2024 totaling $730 million, partly offset by
$250 million in borrowings under the PT-FI revolving credit
facility that were used to fund capital expenditures for PT-FI’s
new downstream processing facilities.
Net repayments of debt totaled $1.2 billion in 2023, including the
repayment of our 3.875% Senior Notes that matured in March 2023
totaling $996 million and open-market purchases of senior notes
totaling $221 million.
Cash Dividends on Common Stock. We paid cash dividends on our
common stock totaling $0.9 billion in 2024 and in 2023. The
declaration and payment of dividends (base or variable) is at the
discretion of our Board and will depend on our financial results,
cash requirements, global economic conditions and other factors
deemed relevant by our Board. Refer to Item 1A. “Risk Factors”
contained in Part I of our annual report on Form 10-K for the year
ended December 31, 2024, and “Cautionary Statement” below.
Cash Dividends and Distributions Paid to Noncontrolling Interests.
Cash dividends and distributions paid to noncontrolling interests at our
international operations totaled $1.8 billion (including $1.4 billion
paid to PT-FI’s noncontrolling shareholders) in 2024 and $0.6 billion
(including $0.3 billion paid to PT-FI’s noncontrolling shareholders)
in 2023. Cash dividends and distributions to noncontrolling interests
vary based on the operating results and cash requirements of our
consolidated subsidiaries.
Treasury Stock Purchases. In 2024, we acquired 1.2 million shares
of our common stock for a total cost of $59 million ($50.48 average
cost per share) under the share repurchase program. There were no
shares acquired under the program in 2023. As of February 14,
2025, $3.1 billion remains available under the share repurchase
program. Refer to Note 8 for further discussion.
Contributions from Noncontrolling Interests. We received equity
contributions totaling $50.0 million in 2023 from MIND ID for its
share of capital spending on the underground mine development
projects in the Grasberg minerals district.
Debt
At December 31, 2024, consolidated debt totaled $8.9 billion, with a
weighted-average interest rate of 5.2%. Refer to “Interest Rate Risk”
for further discussion of our fixed- and variable-rate debt.
In November 2024, we repaid $0.7 billion in scheduled senior
note maturities using cash on hand and our next senior note
maturities are in 2027. Our total debt has an average remaining
duration of approximately 10 years.
At December 31, 2024, we had no borrowings and $7 million in
letters of credit issued under our $3.0 billion revolving credit
facility, PT-FI had $250 million in borrowings outstanding under
its $1.75 billion revolving credit facility and Cerro Verde had no
borrowings under its $350 million revolving credit facility. Refer
to Note 6 for further discussion.
Operating Activities
We generated consolidated operating cash flows of $7.2 billion in
2024 and $5.3 billion in 2023. Higher operating cash flows in 2024,
compared with 2023, primarily reflect higher average realized
copper and gold prices and higher gold sales volumes, as well as
working capital changes related to the timing of approval of PT-FI’s
permitted copper concentrate export quota for 2024 and routine
timing related impacts associated with payments to suppliers.
Investing Activities
Capital Expenditures. Capital expenditures, including capitalized
interest, totaled $4.8 billion in 2024 and 2023, including amounts
for major mining projects ($2.1 billion in 2024 and $1.8 billion
in 2023) primarily associated with the underground development
activities in the Grasberg minerals district, and for PT-FI’s new
downstream processing facilities ($1.2 billion in 2024 and $1.7 billion
in 2023).
Refer to “Outlook” for further discussion of projected capital
expenditures for 2025.
Acquisition of Additional Ownership Interest in Cerro Verde. In
September 2024, we purchased 5.3 million shares of Cerro Verde
common stock for a total cost of $210 million, increasing
our ownership interest in Cerro Verde to 55.08% from 53.56%.
Loans to PT Smelting for Expansion. PT-FI made loans to
PT Smelting totaling $28 million in 2024 and $129 million in 2023
to fund PT Smelting’s expansion project. Refer to Note 2 for
further discussion.
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47
prices in the specified future period, which results in price
fluctuations recorded through revenues until the date of settlement.
We record revenues and invoice customers at the time of shipment
based on then-current LME prices, which results in an embedded
derivative on our provisionally priced concentrate and cathode
sales that is adjusted to fair value through earnings each period,
using the period-end forward prices, until final pricing on the date
of settlement. To the extent final prices are higher or lower than
what was recorded on a provisional basis, an increase or decrease to
revenues is recorded each reporting period until the date of final
pricing. Accordingly, in times of rising copper prices, our revenues
benefit from adjustments to the final pricing of provisionally priced
sales pursuant to contracts entered into in prior periods; in times
of falling copper prices, the opposite occurs.
Following are the favorable impacts of net adjustments to the
prior years’ provisionally priced copper sales for the years ended
December 31 (in millions, except per share amounts):
2024
2023
Revenues
$ 28
$ 183
Net income attributable to common stock
$
9
$ 62
Net income per share attributable to common stock
$ 0.01
$ 0.04
At December 31, 2024, we had provisionally priced copper sales at
our copper mining operations totaling 133 million pounds of copper
(net of intercompany sales and noncontrolling interests) recorded
at an average price of $3.96 per pound, subject to final pricing over
the next several months. We estimate that each $0.05 change
in the price realized from the December 31, 2024, provisional price
recorded would have an approximate $12 million effect on 2025
revenues ($4 million to net income attributable to common stock).
The LME copper settlement price closed at $4.25 per pound on
February 13, 2025.
Foreign Currency Exchange Risk
The functional currency for most of our operations is the U.S.
dollar. Substantially all of our revenues and a significant portion of
our costs are denominated in U.S. dollars; however, some costs
and certain asset and liability accounts are denominated in local
currencies, including the Indonesia rupiah, Peruvian sol, Chilean
peso and euro. We recognized foreign currency translation gains
on balances denominated in foreign currencies totaling $17 million
in 2024 and $20 million in 2023. Generally, our operating results
are positively affected when the U.S. dollar strengthens in relation
to those foreign currencies and are adversely affected when the
U.S. dollar weakens in relation to those foreign currencies.
CONTINGENCIES
Environmental Obligations and AROs
Refer to Note 10 and “Critical Accounting Estimates,” and Items 1.
and 2. “Business and Properties” and Item 1A. “Risk Factors”
contained in Part I of our annual report on Form 10-K for the year
ended December 31, 2024, for further information about contingencies
associated with environmental matters and AROs.
For 2025, we expect to incur approximately $0.6 billion of aggregate
environmental capital expenditures and other environmental costs
and $0.2 billion in aggregate ARO expenditures.
Leases
Refer to Note 11, and Item 1A. “Risk Factors” contained in Part I
of our annual report on Form 10-K for the year ended December 31,
2024, for information about lease commitments.
Litigation and Other Contingencies
Refer to Note 10, and Item 1A. “Risk Factors” and Item 3. “Legal
Proceedings” contained in Part I of our annual report on Form 10-K
for the year ended December 31, 2024, for further discussion of
contingencies associated with legal proceedings and other matters,
including tax and Indonesia regulatory matters.
DISCLOSURES ABOUT MARKET RISKS
Commodity Price Risk
Our 2024 consolidated revenues from our copper mining operations
include the sale of copper concentrate, copper cathode, copper
rod, gold, silver, molybdenum and other metals, the sale of
molybdenum in various forms by our molybdenum operations, and
the sale of copper cathode, copper anode and gold in anode
and slimes by Atlantic Copper. Our financial results will vary with
fluctuations in the market prices of the commodities we produce,
primarily copper and gold, and to a lesser extent molybdenum. For
projected sensitivities of our operating cash flow to changes in
commodity prices, refer to “Outlook.” World market prices for these
commodities have fluctuated historically and are affected by
numerous factors beyond our control. Refer to Item 1A. “Risk
Factors” contained in Part I of our annual report on Form 10-K for
the year ended December 31, 2024, for further discussion of
financial risks associated with fluctuations in the market prices of
the commodities we sell.
During 2024, our mined copper was sold 45% in concentrate,
34% as cathode and 21% as rod. All of our copper concentrate
and some cathode sales contracts provide final copper pricing in
a specified future month (generally one to four months from the
shipment date) based primarily on quoted LME monthly average
copper settlement prices. We receive market prices based on
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
48
Freeport | Powering Progress
Following is a summary of estimated annual payments and
the impact of changes in foreign currency rates on our annual
operating costs:
10% Change in
Exchange Rate per $1
Exchange Rate
at December 31,
Estimated Annual Payments
(in millions of U.S. dollars)a
(in millions of
2024
2023
(in local currency)
U.S. dollars)b
Increase
Decrease
Indonesia
Rupiah
16,081
15,339
17.9 trillion
$ 1,113
$ (101)
$ 124
Australian dollar
1.61
1.47
283 million
$ 175
$ (16)
$ 19
South America
Peruvian sol
3.77
3.71
2.1 billion
$ 555
$ (50)
$ 62
Chilean peso
996
877
252 billion
$ 253
$ (23)
$ 28
Spain
Euro
0.96
0.91
164 million
$ 170
$ (15)
$ 19
a. Reflects the estimated impact on annual operating costs assuming a 10% increase or decrease in the exchange rate reported at December 31, 2024.
b. Based on exchange rates at December 31, 2024.
2025
2026
2027
2028
2029
Thereafter
Fair Value
Fixed-rate debt
$ 10
$ 5
$ 1,321
$ 923
$ 477
$ 5,985
$ 8,526
Average interest rate
0.7%
1.7%
5.0%
4.2%
5.2%
5.4%
5.2%
Variable-rate debt
$ 31
$ —
$
—
$ 250
$ —
$
—
$ 281
Average interest rate
3.4%
—%
—%
6.0%
—%
—%
5.7%
Interest Rate Risk
At December 31, 2024, we had total future debt maturities based on
principal amounts of $9.0 billion, of which 97% was fixed-rate debt.
The table below presents average interest rates for our scheduled
maturities of principal for our outstanding debt and the related fair
values at December 31, 2024 (in millions, except percentages):
NEW ACCOUNTING STANDARDS
Refer to Note 1 for discussion of recently issued accounting
standards and their projected impact on our future financial
statements and disclosures.
NET DEBT
We believe that net debt provides investors with information
related to the performance-based payout framework in our financial
policy, which requires us to maintain our net debt at a level not
to exceed the net debt target of $3 billion to $4 billion, excluding
debt for PT-FI’s new downstream processing facilities. We define net
debt as consolidated debt less (i) consolidated cash and cash
equivalents and (ii) current restricted cash associated with PT-FI’s
export proceeds. This information differs from consolidated
debt determined in accordance with U.S. GAAP and should not
be considered in isolation or as a substitute for consolidated
debt determined in accordance with U.S. GAAP. Our net debt,
which may not be comparable to similarly titled measures reported
by other companies, follows (in millions):
As of December 31, 2024
Current portion of debt
$
41
Long-term debt, less current portion
8,907
Consolidated debt
8,948
Less: consolidated cash and cash equivalents
3,923
Less: current restricted cash associated with
PT-FI’s export proceeds
736a
FCX net debt
4,289
Less: debt for PT-FI’s new downstream processing facilities
3,233b
FCX net debt, excluding debt for PT-FI’s new downstream
processing facilities
$1,056
a. In accordance with a regulation issued by the Indonesia government, 30% of PT-FI’s export proceeds
are being temporarily deposited into Indonesia banks for a period of 90 days before withdrawal and
are presented as current restricted cash and cash equivalents in our consolidated balance sheet.
As the 90-day holding period is the only restriction on the cash, we have included such amount in
the calculation of net debt.
b. Represents PT-FI’s senior notes and $250 million of borrowings under PT-FI’s revolving credit facility.
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
2024 Annual Report
49
publications. In the co-product method presentations, shared
costs are allocated to the different products based on their relative
revenue values, which will vary to the extent our metals sales
volumes and realized prices change.
We show revenue adjustments for prior period open sales as
separate line items. Because these adjustments do not result from
current period sales, these amounts have been reflected separately
from revenues on current period sales. Noncash and other costs,
which are removed from site production and delivery costs in the
calculation of unit net cash costs, consist of items such as
ARO accretion and other adjustments, inventory write-offs and
adjustments, stock-based compensation costs, long-lived asset
impairments, idle facility costs, feasibility and optimization study
costs, operational readiness and start-up costs, restructuring
and/or unusual charges. As discussed above, gold, molybdenum
and other metal revenues at copper mines are reflected as credits
against site production and delivery costs in the by-product
method. The following schedules are presentations under both the
by-product and co-product methods together with reconciliations
to amounts reported in our consolidated financial statements.
PRODUCT REVENUES AND PRODUCTION COSTS
Mining Product Revenues and Unit Net Cash Costs (Credits)
We believe unit net cash costs (credits) per pound of copper
and molybdenum are measures intended to provide investors with
information about the cash-generating capacity of our mining
operations expressed on a basis relating to the primary metal
product for the respective operations. We use this measure for
the same purpose and for monitoring operating performance by
our mining operations. This information differs from measures
of performance determined in accordance with U.S. GAAP and
should not be considered in isolation or as a substitute for
measures of performance determined in accordance with U.S. GAAP.
These measures are presented by other metals mining companies,
although our measures may not be comparable to similarly titled
measures reported by other companies.
We present gross profit per pound of copper in the following
tables using both a “by-product” method and a “co-product”
method. We use the by-product method in our presentation of
gross profit per pound of copper because (i) the majority of our
revenues are copper revenues, (ii) we mine ore, which contains
copper, gold, molybdenum and other metals, (iii) it is not possible
to specifically assign all of our costs to revenues from the copper,
gold, molybdenum and other metals we produce, and (iv) it is
the method used by our management and Board to monitor our
operations and to compare mining operations in certain industry
50
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M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
Freeport | Powering Progress
North America Copper Mines Product Revenues, Production Costs and Unit Net Cash Costs
By-Product
Co-Product Method
Year Ended December 31, 2024
Method
Copper
Molybdenuma
Otherb
Total
(In millions)
Revenues
$ 5,417
$ 5,417
$ 608
$ 186
$ 6,211
Site production and delivery, before net noncash and other costs shown below
4,362
3,911
489
152
4,552
By-product credits
(604)
—
—
—
—
Treatment charges
169
161
—
8
169
Net cash costs
3,927
4,072
489
160
4,721
DD&A
439
394
36
9
439
Noncash and other costs, net
235c
222
11
2
235
Total costs
4,601
4,688
536
171
5,395
Gross profit
$
816
$
729
$
72
$ 15
$ 816
Copper sales (millions of recoverable pounds)
1,263
1,263
Molybdenum sales (millions of recoverable pounds)a
30
Gross profit per pound of copper/molybdenum:
Revenues
$ 4.29
$ 4.29
$ 20.13
Site production and delivery, before net noncash and other costs shown below
3.46
3.10
16.20
By-product credits
(0.48)
—
—
Treatment charges
0.13
0.12
—
Unit net cash costs
3.11
3.22
16.20
DD&A
0.34
0.31
1.19
Noncash and other costs, net
0.19c
0.18
0.36
Total unit costs
3.64
3.71
17.75
Gross profit per pound
$ 0.65
$ 0.58
$ 2.38
Reconciliation to Amounts Reported
Production
Revenues
and Delivery
DD&A
(In millions)
Totals presented above
$ 6,211
$ 4,552
$ 439
Treatment charges
(4)
165
—
Noncash and other costs, net
—
235
—
Eliminations and other
33
44
—
North America copper mines
6,240
4,996
439
Other miningd
25,337
16,246
1,744
Corporate, other & eliminations
(6,122)
(5,688)
58
As reported in our consolidated financial statements
$ 25,455
$ 15,554
$ 2,241
a. Reflects sales of molybdenum produced by certain of the North America copper mines to our molybdenum sales company at market-based pricing.
b. Includes gold and silver product revenues and production costs.
c. Includes charges totaling $62 million ($0.05 per pound of copper) for feasibility and optimization studies and $60 million ($0.05 per pound of copper) for metals inventory adjustments.
d. Represents the combined total for our other mining operations as presented in Note 14.
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
2024 Annual Report
51
North America Copper Mines Product Revenues, Production Costs and Unit Net Cash Costs (continued)
By-Product
Co-Product Method
Year Ended December 31, 2023
Method
Copper
Molybdenuma
Otherb
Total
(In millions)
Revenues, excluding adjustments
$ 5,368
$ 5,368
$ 710
$ 171
$ 6,249
Site production and delivery, before net noncash and other costs shown below
4,093
3,621
535
149
4,305
By-product credits
(669)
—
—
—
—
Treatment charges
169
161
—
8
169
Net cash costs
3,593
3,782
535
157
4,474
DD&A
418
371
39
8
418
Noncash and other costs, net
242c
215
24
3
242
Total costs
4,253
4,368
598
168
5,134
Other revenue adjustments, primarily for pricing on prior period open sales
13
13
—
—
13
Gross profit
$ 1,128
$ 1,013
$ 112
$ 3
$ 1,128
Copper sales (millions of recoverable pounds)
1,367
1,367
Molybdenum sales (millions of recoverable pounds)a
30
Gross profit per pound of copper/molybdenum:
Revenues, excluding adjustments
$ 3.93
$ 3.93
$ 23.38
Site production and delivery, before net noncash and other costs shown below
3.00
2.65
17.63
By-product credits
(0.49)
—
—
Treatment charges
0.12
0.12
—
Unit net cash costs
2.63
2.77
17.63
DD&A
0.30
0.27
1.30
Noncash and other costs, net
0.18c
0.16
0.77
Total unit costs
3.11
3.20
19.70
Other revenue adjustments, primarily for pricing on prior period open sales
0.01
0.01
—
Gross profit per pound
$ 0.83
$ 0.74
$ 3.68
Reconciliation to Amounts Reported
Production
Revenues
and Delivery
DD&A
(In millions)
Totals presented above
$ 6,249
$ 4,305
$ 418
Treatment charges
(9)
160
—
Noncash and other costs, net
—
242
—
Other revenue adjustments, primarily for pricing on prior period open sales
13
—
—
Eliminations and other
63
71
—
North America copper mines
6,316
4,778
418
Other miningd
22,791
14,867
1,586
Corporate, other & eliminations
(6,252)
(6,018)
64
As reported in our consolidated financial statements
$ 22,855
$ 13,627
$ 2,068
a. Reflects sales of molybdenum produced by certain of the North America copper mines to our molybdenum sales company at market-based pricing.
b. Includes gold and silver product revenues and production costs.
c. Includes charges totaling $107 million ($0.08 per pound of copper) for feasibility and optimization studies and $11 million ($0.01 per pound of copper) for metals inventory adjustments.
d. Represents the combined total for our other mining operations as presented in Note 14.
52
Freeport | Powering Progress
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
South America Mining Product Revenues, Production Costs and Unit Net Cash Costs
By-Product
Co-Product Method
Year Ended December 31, 2024
Method
Copper
Othera
Total
(In millions)
Revenues, excluding adjustments
$ 4,894
$ 4,894
$ 446
$ 5,340
Site production and delivery, before net noncash and other costs shown below
3,094b
2,865
281
3,146
By-product credits
(394)
—
—
—
Treatment charges
193
193
—
193
Royalty on metals
8
7
1
8
Net cash costs
2,901
3,065
282
3,347
DD&A
446
409
37
446
Noncash and other costs, net
87c
85
2
87
Total costs
3,434
3,559
321
3,880
Other revenue adjustments, primarily for pricing on prior period open sales
32
33
(1)
32
Gross profit
$ 1,492
$ 1,368
$ 124
$ 1,492
Copper sales (millions of recoverable pounds)
1,177
1,177
Gross profit per pound of copper:
Revenues, excluding adjustments
$ 4.16
$ 4.16
Site production and delivery, before net noncash and other costs shown below
2.63b
2.43
By-product credits
(0.34)
—
Treatment charges
0.16
0.16
Royalty on metals
0.01
0.01
Unit net cash costs
2.46
2.60
DD&A
0.38
0.35
Noncash and other costs, net
0.08c
0.07
Total unit costs
2.92
3.02
Other revenue adjustments, primarily for pricing on prior period open sales
0.03
0.03
Gross profit per pound
$ 1.27
$ 1.17
Reconciliation to Amounts Reported
Production
Revenues
and Delivery
DD&A
(In millions)
Totals presented above
$ 5,340
$ 3,146
$ 446
Treatment charges
(193)
—
—
Royalty on metals
(8)
—
—
Noncash and other costs, net
—
87
—
Other revenue adjustments, primarily for pricing on prior period open sales
32
—
—
Eliminations and other
—
(3)
—
South America operations
5,171
3,230
446
Other miningd
26,406
18,012
1,737
Corporate, other & eliminations
(6,122)
(5,688)
58
As reported in our consolidated financial statements
$ 25,455
$ 15,554
$ 2,241
a. Includes silver sales of 3.6 million ounces ($29.35 per ounce average realized price) and sales of molybdenum produced by Cerro Verde to our molybdenum sales company at market-based pricing.
b. Includes $97 million ($0.08 per pound of copper) associated with nonrecurring labor-related charges at Cerro Verde related to the new CLAs with its unions.
c. Includes charges totaling $57 million ($0.05 per pound of copper) for feasibility and optimization studies.
d. Represents the combined total for our other mining operations as presented in Note 14.
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
2024 Annual Report
53
South America Mining Product Revenues, Production Costs and Unit Net Cash Costs (continued)
By-Product
Co-Product Method
Year Ended December 31, 2023
Method
Copper
Othera
Total
(In millions)
Revenues, excluding adjustments
$ 4,583
$ 4,583
$ 526
$ 5,109
Site production and delivery, before net noncash and other costs shown below
3,083
2,810
339
3,149
By-product credits
(463)
—
—
—
Treatment charges
234
234
—
234
Royalty on metals
8
7
1
8
Net cash costs
2,862
3,051
340
3,391
DD&A
459
412
47
459
Noncash and other costs, net
92b
87
5
92
Total costs
3,413
3,550
392
3,942
Other revenue adjustments, primarily for pricing on prior period open sales
71
71
3
74
Gross profit
$ 1,241
$ 1,104
$ 137
$ 1,241
Copper sales (millions of recoverable pounds)
1,200
1,200
Gross profit per pound of copper:
Revenues, excluding adjustments
$
3.82
$
3.82
Site production and delivery, before net noncash and other costs shown below
2.57
2.34
By-product credits
(0.39)
—
Treatment charges
0.19
0.19
Royalty on metals
0.01
0.01
Unit net cash costs
2.38
2.54
DD&A
0.38
0.35
Noncash and other costs, net
0.08b
0.07
Total unit costs
2.84
2.96
Other revenue adjustments, primarily for pricing on prior period open sales
0.06
0.06
Gross profit per pound
$
1.04
$
0.92
Reconciliation to Amounts Reported
Production
Revenues
and Delivery
DD&A
(In millions)
Totals presented above
$ 5,109
$ 3,149
$ 459
Treatment charges
(234)
—
—
Royalty on metals
(8)
—
—
Noncash and other costs, net
—
92
—
Other revenue adjustments, primarily for pricing on prior period open sales
74
—
—
Eliminations and other
—
(2)
—
South America operations
4,941
3,239
459
Other miningc
24,166
16,406
1,545
Corporate, other & eliminations
(6,252)
(6,018)
64
As reported in our consolidated financial statements
$ 22,855
$ 13,627
$ 2,068
a. Includes silver sales of 4.1 million ounces ($23.57 per ounce average realized price) and sales of molybdenum produced by Cerro Verde to our molybdenum sales company at market-based pricing.
b. Includes charges totaling $44 million ($0.04 per pound of copper) for feasibility and optimization studies.
c. Represents the combined total for our other mining operations as presented in Note 14.
54
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M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
Indonesia Mining Product Revenues, Production Costs and Unit Net Cash (Credits) Costs
By-Product
Co-Product Method
Year Ended December 31, 2024
Method
Copper
Gold
Silver & Othera
Total
(In millions)
Revenues, excluding adjustments
$ 6,842
$ 6,842
$ 4,389
$ 218
$ 11,449
Site production and delivery, before net noncash and other costs shown below
2,681
1,602
1,028
51
2,681
Gold, silver and other by-product credits
(4,605)
—
—
—
—
Treatment charges
571
341
219
11
571
Export duties
457
273
175
9
457
Royalty on metals
433
260
167
6
433
Net cash (credits) costs
(463)
2,476
1,589
77
4,142
DD&A
1,193
713
457
23
1,193
Noncash and other costs, net
362b
217
139
6
362
Total costs
1,092
3,406
2,185
106
5,697
Other revenue adjustments, primarily for pricing on prior period open sales
7
7
(1)
(1)
5
Gross profit
$ 5,757
$ 3,443
$ 2,203
$ 111
$ 5,757
Copper sales (millions of recoverable pounds)
1,632
1,632
Gold sales (thousands of recoverable ounces)
1,817
Gross profit per pound of copper/per ounce of gold:
Revenues, excluding adjustments
$ 4.19
$ 4.19
$ 2,418
Site production and delivery, before net noncash and other costs shown below
1.64
0.98
566
Gold, silver and other by-product credits
(2.82)
—
—
Treatment charges
0.35
0.21
120
Export duties
0.28
0.17
96
Royalty on metals
0.27
0.16
92
Unit net cash (credits) costs
(0.28)
1.52
874
DD&A
0.73
0.44
252
Noncash and other costs, net
0.22b
0.13
77
Total unit costs
0.67
2.09
1,203
Other revenue adjustments, primarily for pricing on prior period open sales
0.01
0.01
(2)
Gross profit per pound/ounce
$ 3.53
$ 2.11
$ 1,213
Reconciliation to Amounts Reported
Production
Revenues
and Delivery
DD&A
(In millions)
Totals presented above
$ 11,449
$ 2,681
$ 1,193
Treatment charges
(245)
326c
—
Export duties
(457)
—
—
Royalty on metals
(433)
—
—
Noncash and other costs, net
—
362
—
Other revenue adjustments, primarily for pricing on prior period open sales
5
—
—
Eliminations and other
(1)
(1)
—
Indonesia operations
10,318
3,368
1,193
Other miningd
21,259
17,874
990
Corporate, other & eliminations
(6,122)
(5,688)
58
As reported in our consolidated financial statements
$ 25,455
$ 15,554
$ 2,241
a. Includes silver sales of 6.9 million ounces ($28.52 per ounce average realized price).
b. Includes charges totaling (i) $144 million ($0.09 per pound of copper) associated with ARO adjustments, (ii) $133 million ($0.08 per pound of copper) for operational readiness and start-up costs associated with
the new downstream processing facilities, (iii) $34 million ($0.02 per pound of copper) related to amounts capitalized in prior years associated with the construction of the new downstream processing facilities, and
(iv) $28 million ($0.02 per pound of copper) for feasibility and optimization studies.
c. Represents tolling costs paid to PT Smelting.
d. Represents the combined total for our other mining operations as presented in Note 14.
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
2024 Annual Report
55
Indonesia Mining Product Revenues, Production Costs and Unit Net Cash (Credits) Costs (continued)
By-Product
Co-Product Method
Year Ended December 31, 2023
Method
Copper
Gold
Silver & Othera
Total
(In millions)
Revenues, excluding adjustments
$ 5,801
$ 5,801
$ 3,346
$ 157
$ 9,304
Site production and delivery, before net noncash and other costs shown below
2,467
1,538
887
42
2,467
Gold, silver and other by-product credits
(3,520)
—
—
—
—
Treatment charges
537
335
193
9
537
Export duties
324
202
117
5
324
Royalty on metals
338
212
121
5
338
Net cash costs
146
2,287
1,318
61
3,666
DD&A
1,028
641
370
17
1,028
Noncash and other costs, net
22b
14
8
—
22
Total costs
1,196
2,942
1,696
78
4,716
Other revenue adjustments, primarily for pricing on prior period open sales
114
114
18
(1)
131
PT Smelting intercompany profit
112
70
40
2
112
Gross profit
$ 4,831
$ 3,043
$ 1,708
$ 80
$ 4,831
Copper sales (millions of recoverable pounds)
1,525
1,525
Gold sales (thousands of recoverable ounces)
1,697
Gross profit per pound of copper/per ounce of gold:
Revenues, excluding adjustments
$
3.81
$ 3.81
$ 1,972
Site production and delivery, before net noncash and other costs shown below
1.62
1.01
522
Gold, silver and other by-product credits
(2.30)
—
—
Treatment charges
0.35
0.22
114
Export duties
0.21
0.13
69
Royalty on metals
0.22
0.14
71
Unit net cash costs
0.10
1.50
776
DD&A
0.68
0.42
218
Noncash and other costs, net
0.01b
0.01
5
Total unit costs
0.79
1.93
999
Other revenue adjustments, primarily for pricing on prior period open sales
0.08
0.07
9
PT Smelting intercompany profit
0.07
0.05
24
Gross profit per pound/ounce
$
3.17
$ 2.00
$ 1,006
Reconciliation to Amounts Reported
Production
Revenues
and Delivery
DD&A
(In millions)
Totals presented above
$ 9,304
$ 2,467
$ 1,028
Treatment charges
(336)
201c
—
Export duties
(324)
—
—
Royalty on metals
(338)
—
—
Noncash and other costs, net
—
22
—
Other revenue adjustments, primarily for pricing on prior period open sales
131
—
—
PT Smelting intercompany profit
—
(112)
—
Eliminations and other
—
(8)
—
Indonesia operations
8,437
2,570
1,028
Other miningd
20,670
17,075
976
Corporate, other & eliminations
(6,252)
(6,018)
64
As reported in our consolidated financial statements
$ 22,855
$ 13,627
$ 2,068
a. Includes silver sales of 6.0 million ounces ($23.37 per ounce average realized price).
b. Includes credits of $112 million ($0.07 per pound of copper) associated with ARO adjustments, and charges of $55 million ($0.04 per pound of copper) associated with an administrative fine and $27 million
($0.02 per pound of copper) for feasibility and optimization studies.
c. Represents tolling costs paid to PT Smelting.
d. Represents the combined total for our other mining operations as presented in Note 14.
56
Freeport | Powering Progress
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
Molybdenum Mines Product Revenues, Production Costs and Unit Net Cash Costs
Years Ended December 31,
2024
2023
(In millions)
Revenues, excluding adjustmentsa
$
619
$
702
Site production and delivery, before net noncash and other costs shown below
508
423
Treatment charges and other
27
25
Net cash costs
535
448
DD&A
73
66
Noncash and other costs, net
22
16
Total costs
630
530
Gross (loss) profit
$
(11)
$
172
Molybdenum sales (millions of recoverable pounds)a
30
30
Gross (loss) profit per pound of molybdenum:
Revenues, excluding adjustmentsa
$ 20.66
$ 23.71
Site production and delivery, before net noncash and other costs shown below
16.99
14.28
Treatment charges and other
0.90
0.85
Unit net cash costs
17.89
15.13
DD&A
2.43
2.24
Noncash and other costs, net
0.73
0.55
Total unit costs
21.05
17.92
Gross (loss) profit per pound
$ (0.39)
$ 5.79
Reconciliation to Amounts Reported
Production
Revenues
and Delivery
DD&A
(In millions)
Year Ended December 31, 2024
Totals presented above
$
619
$
508
$
73
Treatment charges and other
(27)
—
—
Noncash and other costs, net
—
22
—
Molybdenum mines
592
530
73
Other miningb
30,985
20,712
2,110
Corporate, other & eliminations
(6,122)
(5,688)
58
As reported in our consolidated financial statements
$ 25,455
$ 15,554
$ 2,241
Year Ended December 31, 2023
Totals presented above
$
702
$
423
$
66
Treatment charges and other
(25)
—
—
Noncash and other costs, net
—
16
—
Molybdenum mines
677
439
66
Other miningb
28,430
19,206
1,938
Corporate, other & eliminations
(6,252)
(6,018)
64
As reported in our consolidated financial statements
$ 22,855
$ 13,627
$ 2,068
a. Reflects sales of the Molybdenum mines’ production to the molybdenum sales company at market-based pricing. On a consolidated basis, realizations are based on the actual contract terms for sales to third parties;
as a result, our consolidated average realized price per pound of molybdenum will differ from the amounts reported in this table.
b. Represents the combined total for our other mining operations as presented in Note 14. Also includes amounts associated with the molybdenum sales company, which includes sales of molybdenum produced by the
Molybdenum mines and by certain of the North America and South America copper mines.
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
2024 Annual Report
57
CAUTIONARY STATEMENT
Our discussion and analysis contains forward-looking statements
in which we discuss our potential future performance, operations
and projects. Forward-looking statements are all statements other
than statements of historical facts, such as plans, projections,
or expectations relating to business outlook, strategy, goals or targets;
global market conditions; ore grades and milling rates; production
and sales volumes; unit net cash costs (credits) and operating costs;
capital expenditures; operating plans (including mine sequencing);
cash flows; liquidity; PT-FI’s commissioning, remediation and full
ramp-up of its new smelter and full production at the PMR;
potential extension of PT-FI’s IUPK beyond 2041; export licenses,
export duties, and export volumes, including PT-FI’s ability to
continue exports of copper concentrate until full ramp-up is
achieved at its new smelter in Indonesia; timing of shipments of
inventoried production; our commitment to deliver responsibly
produced copper and molybdenum, including plans to implement,
validate and maintain validation of our operating sites under
specific frameworks; execution of our energy and climate strategies
and the underlying assumptions and estimated impacts on our
business and stakeholders related thereto; achievement of 2030
climate targets and 2050 net zero aspiration; improvements in
operating procedures and technology innovations and applications;
exploration efforts and results; development and production
activities, rates and costs; future organic growth opportunities; tax
rates; the impact of copper, gold and molybdenum price changes;
the impact of deferred intercompany profits on earnings; mineral
reserve and mineral resource estimates; final resolution of
settlements associated with ongoing legal and environmental
proceedings; debt repurchases; and the ongoing implementation
of our financial policy and future returns to shareholders, including
dividend payments (base or variable) and share repurchases.
The words “anticipates,” “may,” “can,” “plans,” “believes,”
“estimates,” “expects,” “projects,” “targets,” “intends,” “likely,”
“will,” “should,” “could,” “to be,” ”potential,” “assumptions,”
“guidance,” “aspirations,” “future,” “commitments,” “pursues,”
“initiatives,” “objectives,” “opportunities,” “strategy” and any similar
expressions are intended to identify those assertions as forward-
looking statements. The declaration and payment of dividends
(base or variable), and timing and amount of any share repurchases
are at the discretion of our Board and management, respectively,
and are subject to a number of factors, including not exceeding
our net debt target, capital availability, our financial results, cash
requirements, global economic conditions, changes in laws,
contractual restrictions and other factors deemed relevant by our
Board or management, as applicable. Our share repurchase
program may be modified, increased, suspended or terminated at
any time at the Board’s discretion.
We caution readers that forward-looking statements are not
guarantees of future performance and actual results may differ
materially from those anticipated, expected, projected or assumed
in the forward-looking statements. Important factors that can
cause our actual results to differ materially from those anticipated in
the forward-looking statements include, but are not limited to,
supply of and demand for, and prices of the commodities we produce,
primarily copper and gold; PT-FI’s ability to export and sell or
inventory copper concentrates through remediation and full
ramp-up of its new smelter in Indonesia; changes in export duties;
completion of remediation activities and achieving full ramp-up of
the new smelter in Indonesia; full production at the PMR; production
rates; timing of shipments; price and availability of consumables
and components we purchase as well as constraints on supply and
logistics, and transportation services; changes in our cash
requirements, financial position, financing or investment plans;
changes in general market, economic, geopolitical, regulatory
or industry conditions; reductions in liquidity and access to capital;
changes in tax laws and regulations; political and social risks,
including the potential effects of violence in Indonesia, civil unrest in
Peru, and relations with local communities and Indigenous Peoples;
operational risks inherent in mining, with higher inherent risks
in underground mining; mine sequencing; changes in mine plans
or operational modifications, delays, deferrals or cancellations,
including the ability to smelt and refine or inventory; results of
technical, economic or feasibility studies; potential inventory
adjustments; potential impairment of long-lived mining assets;
satisfaction of requirements in accordance with PT-FI’s IUPK to
extend mining rights from 2031 through 2041; process relating to the
extension of PT-FI’s IUPK beyond 2041; cybersecurity risks; any
major public health crisis; labor relations, including labor-related
work stoppages and increased costs; compliance with applicable
environmental, health and safety laws and regulations; weather- and
climate-related risks; environmental risks, including availability of
secure water supplies; impacts, expenses or results from litigation or
investigations; tailings management; our ability to comply with our
responsible production commitments under specific frameworks;
and any changes to such frameworks and other factors described in
more detail in Item 1A. “Risk Factors” contained in Part I of our
annual report on Form 10-K for the year ended December 31, 2024.
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
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Freeport | Powering Progress
Our annual report on Form 10-K for the year ended December 31,
2024, also contains measures such as net debt and unit net cash
costs (credits) per pound of copper and molybdenum, which are not
recognized under U.S. GAAP. Refer to “Operations—Unit Net Cash
Costs (Credits)” for further discussion of unit net cash costs (credits)
associated with our operating divisions, and to “Product Revenues
and Production Costs” for reconciliations of per pound costs by
operating division to production and delivery costs applicable to sales
reported in our consolidated financial statements. Refer to “Net
Debt” for reconciliations of consolidated debt, consolidated cash
and cash equivalents and current restricted cash associated
with PT-FI’s export proceeds to net debt. For forward-looking unit
net cash costs (credits) per pound of copper and molybdenum
measures, we are unable to provide a reconciliation to the most
comparable U.S. GAAP measure without unreasonable effort
because estimating such U.S. GAAP measures and providing a
meaningful reconciliation is extremely difficult and requires a level
of precision that is unavailable for these future periods and the
information needed to reconcile these measures is dependent upon
future events, many of which are outside of our control as
described above. Forward-looking non-U.S. GAAP measures are
estimated consistent with the relevant definitions and assumptions.
Investors are cautioned that many of the assumptions upon
which our forward-looking statements are based are likely to
change after the date the forward-looking statements are made,
including for example commodity prices, which we cannot control,
and production volumes and costs or technological solutions and
innovations, some aspects of which we may not be able to control.
Further, we may make changes to our business plans that could
affect our results. We undertake no obligation to update any
forward-looking statements, which speak only as of the date made,
notwithstanding any changes in our assumptions, changes in
business plans, actual experience or other changes.
Estimates of mineral reserves and mineral resources are subject
to considerable uncertainty. Such estimates are, to a large extent,
based on metal prices for the commodities we produce and
interpretations of geologic data, which may not necessarily be
indicative of future results or quantities ultimately recovered. Our
annual report on Form 10-K for the year ended December 31, 2024,
also includes forward-looking statements regarding mineral
resources not included in proven and probable mineral reserves.
A mineral resource, which includes measured, indicated and
inferred mineral resources, is a concentration or occurrence of
material of economic interest in or on the Earth’s crust in such
form, grade or quality, and quantity that there are reasonable
prospects for economic extraction. Such a deposit cannot qualify
as recoverable proven and probable mineral reserves until
legal and economic feasibility are confirmed based upon a
comprehensive evaluation of development and operating costs,
grades, recoveries and other material modifying factors.
Accordingly, no assurance can be given that the estimated mineral
resources will become proven and probable mineral reserves.
M A N A G E M E N T ’ S R E P O R T O N I N T E R N A L C O N T R O L O V E R F I N A N C I A L R E P O R T I N G
2024 Annual Report
59
Freeport-McMoRan Inc.’s (the Company’s) management is
responsible for establishing and maintaining adequate internal
control over financial reporting. Internal control over financial
reporting is defined in Rule 13a-15(f) or 15d-15(f) under the Securities
Exchange Act of 1934 as a process designed by, or under the
supervision of, the Company’s principal executive and principal
financial officers and effected by the Company’s Board of
Directors, management and other personnel, to provide reasonable
assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in
accordance with generally accepted accounting principles and
includes those policies and procedures that:
• Pertain to the maintenance of records that in reasonable detail
accurately and fairly reflect the transactions and dispositions of
the Company’s assets;
• Provide reasonable assurance that transactions are recorded
as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and
that receipts and expenditures of the Company are being
made only in accordance with authorizations of management
and directors of the Company; and
• Provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use or disposition of
the Company’s assets that could have a material effect on the
financial statements.
Because of its inherent limitations, internal control over financial
reporting may not prevent or detect misstatements. Projections
of any evaluation of effectiveness to future periods are subject
to the risk that controls may become inadequate because of
changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate.
Our management, including our principal executive officer and
principal financial officer, assessed the effectiveness of our
internal control over financial reporting as of the end of the fiscal
year covered by this annual report on Form 10-K. In making this
assessment, our management used the criteria set forth in
Internal Control-Integrated Framework issued by the Committee
of Sponsoring Organizations of the Treadway Commission
(2013 framework) (the COSO criteria). Based on its assessment,
management concluded that, as of December 31, 2024, our
Company’s internal control over financial reporting is effective
based on the COSO criteria.
Ernst & Young LLP, an independent registered public accounting
firm, who audited the Company’s consolidated financial statements
included in this Form 10-K, has issued an attestation report on
the Company’s internal control over financial reporting, which is
included herein.
Kathleen L. Quirk
Maree E. Robertson
President and
Executive Vice President and
Chief Executive Officer
Chief Financial Officer
R E P O R T O F I N D E P E N D E N T R E G I S T E R E D P U B L I C A C C O U N T I N G F I R M
60
Freeport | Powering Progress
To the Board of Directors and Stockholders of
Freeport-McMoRan Inc.
Opinion on Internal Control Over Financial Reporting
We have audited Freeport-McMoRan Inc.’s internal control over
financial reporting as of December 31, 2024, based on criteria
established in Internal Control-Integrated Framework issued by
the Committee of Sponsoring Organizations of the Treadway
Commission (2013 framework) (the COSO criteria). In our opinion,
Freeport-McMoRan Inc. (the Company) maintained, in all material
respects, effective internal control over financial reporting as of
December 31, 2024, based on the COSO criteria.
We also have audited, in accordance with the standards of the
Public Company Accounting Oversight Board (United States)
(PCAOB), the consolidated balance sheets of the Company as of
December 31, 2024 and 2023, the related consolidated statements
of income, comprehensive income, equity and cash flows for each
of the three years in the period ended December 31, 2024, and the
related notes and our report dated February 14, 2025 expressed
an unqualified opinion thereon.
Basis for Opinion
The Company’s management is responsible for maintaining
effective internal control over financial reporting and for its
assessment of the effectiveness of internal control over financial
reporting included in the accompanying Management’s Report
on Internal Control Over Financial Reporting. Our responsibility is
to express an opinion on the Company’s internal control over
financial reporting based on our audit. We are a public accounting
firm registered with the PCAOB and are required to be independent
with respect to the Company in accordance with the U.S. federal
securities laws and the applicable rules and regulations of the
Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of
the PCAOB. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether effective
internal control over financial reporting was maintained in all
material respects.
Our audit included obtaining an understanding of internal control
over financial reporting, assessing the risk that a material weakness
exists, testing and evaluating the design and operating effectiveness
of internal control based on the assessed risk, and performing such
other procedures as we considered necessary in the circumstances.
We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control
Over Financial Reporting
A company’s internal control over financial reporting is a process
designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for
external purposes in accordance with generally accepted
accounting principles. A company’s internal control over financial
reporting includes those policies and procedures that (1) pertain to
the maintenance of records that, in reasonable detail, accurately
and fairly reflect the transactions and dispositions of the assets of
the company; (2) provide reasonable assurance that transactions are
recorded as necessary to permit preparation of financial statements
in accordance with generally accepted accounting principles, and
that receipts and expenditures of the company are being made only
in accordance with authorizations of management and directors
of the company; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use,
or disposition of the company’s assets that could have a material
effect on the financial statements.
Because of its inherent limitations, internal control over financial
reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are
subject to the risk that controls may become inadequate because
of changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate.
ERNST & YOUNG LLP
Phoenix, Arizona
February 14, 2025
R E P O R T O F I N D E P E N D E N T R E G I S T E R E D P U B L I C A C C O U N T I N G F I R M
2024 Annual Report
61
To the Board of Directors and Stockholders of
Freeport-McMoRan Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets
of Freeport-McMoRan Inc. (the Company) as of December 31,
2024 and 2023, the related consolidated statements of income,
comprehensive income, equity and cash flows for each of the three
years in the period ended December 31, 2024, and the related
notes (collectively referred to as the “consolidated financial
statements”). In our opinion, the consolidated financial statements
present fairly, in all material respects, the financial position of
the Company at December 31, 2024 and 2023, and the results of its
operations and its cash flows for each of the three years in the
period ended December 31, 2024, in conformity with U.S. generally
accepted accounting principles.
We also have audited, in accordance with the standards of the
Public Company Accounting Oversight Board (United States)
(PCAOB), the Company’s internal control over financial reporting
as of December 31, 2024, based on criteria established in Internal
Control-Integrated Framework issued by the Committee of
Sponsoring Organizations of the Treadway Commission (2013
framework) and our report dated February 14, 2025 expressed an
unqualified opinion thereon.
Basis for Opinion
These financial statements are the responsibility of the Company’s
management. Our responsibility is to express an opinion on the
Company’s financial statements based on our audits. We are a
public accounting firm registered with the PCAOB and are required
to be independent with respect to the Company in accordance
with the U.S. federal securities laws and the applicable rules and
regulations of the Securities and Exchange Commission and
the PCAOB.
We conducted our audits in accordance with the standards of the
PCAOB. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement, whether due to error
or fraud. Our audits included performing procedures to assess the
risks of material misstatement of the financial statements, whether
due to error or fraud, and performing procedures that respond to
those risks. Such procedures included examining, on a test basis,
evidence regarding the amounts and disclosures in the financial
statements. Our audits also included evaluating the accounting
principles used and significant estimates made by management,
as well as evaluating the overall presentation of the financial
statements. We believe that our audits provide a reasonable basis
for our opinion.
Critical Audit Matters
The critical audit matters communicated below are matters arising
from the current period audit of the consolidated financial
statements that were communicated or required to be communicated
to the audit committee and that: (1) relate to accounts or disclosures
that are material to the consolidated financial statements and
(2) involved our especially challenging, subjective, or complex
judgments. The communication of critical audit matters does not alter
in any way our opinion on the consolidated financial statements,
taken as a whole, and we are not, by communicating the critical
audit matters below, providing separate opinions on the critical audit
matters or on the accounts or disclosures to which they relate.
R E P O R T O F I N D E P E N D E N T R E G I S T E R E D P U B L I C A C C O U N T I N G F I R M
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Tax Contingencies
As discussed in Note 10 to the consolidated financial
statements, the Company operates in multiple tax
jurisdictions, and its income tax returns are subject to
examination by tax authorities in those jurisdictions
who may challenge any tax position on these returns.
Uncertainty in a tax position may arise because tax
laws are subject to interpretation. The Company uses
significant judgment, specifically as it relates to Peru
and Indonesia, to determine whether, based on the
technical merits, a tax position is more likely than not to
be sustained upon examination by taxing authorities.
Auditing management’s tax positions involved
significant auditor judgment, because management’s
tax positions require a high degree of judgment and are
based on interpretations of tax laws and legal rulings.
We obtained an understanding, evaluated the design
and tested the operating effectiveness of controls
over the Company’s accounting process for tax
contingencies. This included testing controls over
management’s review of the technical merits of tax
positions and disputed tax assessments, including
the process to measure the financial statement impact
of these tax matters.
Our audit procedures included, among others,
evaluating the Company’s accounting for these tax
positions by using our knowledge of and experience
with the application of respective tax laws by the
relevant tax authorities, and/or our understanding
of the contractual arrangements with the applicable
government, if the position is governed by a contract.
We analyzed the Company’s assumptions and data
used to determine the tax assessments and tested the
accuracy of the calculations. We involved our tax
professionals located in the respective jurisdictions to
assess the technical merits of the Company’s tax
positions and to evaluate the application of relevant tax
laws in the Company’s recognition determination. We
obtained and assessed the Company’s correspondence
with the relevant tax authorities and, as applicable,
third-party tax or legal opinions or other external
correspondence and analyses. We also evaluated the
adequacy of the Company’s disclosures included in
Notes 9 and 10 in relation to these tax matters.
Environmental Obligations
As discussed in Note 10 to the consolidated financial
statements, the Company is subject to various
national, state and local environmental laws and
regulations that govern the protection of the
environment, including remediation, restoration and
reclamation of environmental contamination.
Liabilities for environmental contingencies are recorded
when it is probable that obligations have been
incurred and the costs can be reasonably estimated.
As of December 31, 2024, the Company’s consolidated
environmental obligations totaled $2.0 billion.
Auditing management’s accounting for environmental
obligations was challenging because significant
judgment is required by the Company to estimate the
future costs to remediate the environmental matters.
Description
of the Matter
How We
Addressed
the Matter in
Our Audit
Description
of the Matter
R E P O R T O F I N D E P E N D E N T R E G I S T E R E D P U B L I C A C C O U N T I N G F I R M
2024 Annual Report
63
The significant judgment was primarily due to the
inherent estimation uncertainty relating to the
amount of future costs. Such uncertainties involve
assumptions regarding the nature and extent of
site contamination, the anticipated costs, scope
and timing of remediation activities and required
remediation methods under presently enacted laws
and regulations, and allocation of costs among
other potentially responsible parties.
We obtained an understanding, evaluated the
design and tested the operating effectiveness
of controls over the Company’s measurement
of the environmental obligations. For example,
we tested controls over management’s review
of the environmental obligations calculations
and management’s assessment to evaluate key
judgments and estimates affecting the
environmental obligations.
To test the Company’s measurement of the
environmental obligations, among other procedures,
we inspected correspondence with regulatory
agencies, including correspondence related to
remediation activities and methods and potentially
responsible parties, obtained external legal counsel
confirmation letters, and inspected environmental
studies. Additionally, we tested the accuracy
and completeness of the underlying data used in
the Company’s analyses and tested the significant
assumptions discussed above. We utilized our
environmental professionals to search for new or
contrary evidence related to the Company’s sites
and to assist in evaluating the estimated future
costs by comparing the estimated future costs to
environmental permits, third party observable
data such as vendor quotes, and to historical costs
incurred for similar activities.
ERNST & YOUNG LLP
We have served as the Company’s auditor since 2002.
Phoenix, Arizona
February 14, 2025
How We
Addressed
the Matter in
Our Audit
C O N S O L I D A T E D S T A T E M E N T S O F I N C O M E
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Freeport | Powering Progress
Years Ended December 31,
2024
2023
2022
(In millions, except per share amounts)
Revenues
$ 25,455
$ 22,855
$ 22,780
Cost of sales:
Production and delivery
15,554
13,627
13,070
Depreciation, depletion and amortization
2,241
2,068
2,019
Total cost of sales
17,795
15,695
15,089
Selling, general and administrative expenses
513
479
420
Exploration and research expenses
156
137
115
Environmental obligations and shutdown costs
127
319
121
Net gain on sales of assets
—
—
(2)
Total costs and expenses
18,591
16,630
15,743
Operating income
6,864
6,225
7,037
Interest expense, net
(319)
(515)
(560)
Net gain on early extinguishment of debt
—
10
31
Other income, net
362
286
207
Income before income taxes and equity in affiliated companies’ net earnings
6,907
6,006
6,715
Provision for income taxes
(2,523)
(2,270)
(2,267)
Equity in affiliated companies’ net earnings
15
15
31
Net income
4,399
3,751
4,479
Net income attributable to noncontrolling interests
(2,510)
(1,903)
(1,011)
Net income attributable to common stockholders
$ 1,889
$ 1,848
$ 3,468
Net income per share attributable to common stockholders:
Basic
$ 1.31
$ 1.28
$ 2.40
Diluted
$ 1.30
$ 1.28
$ 2.39
Weighted-average common shares outstanding:
Basic
1,438
1,434
1,441
Diluted
1,445
1,443
1,451
Dividends declared per share of common stock
$ 0.60
$ 0.60
$ 0.60
The accompanying Notes to Consolidated Financial Statements are an integral part of these consolidated financial statements.
C O N S O L I D A T E D S T A T E M E N T S O F C O M P R E H E N S I V E I N C O M E
2024 Annual Report
65
Years Ended December 31,
2024
2023
2022
(In millions)
Net income
$ 4,399
$ 3,751
$ 4,479
Other comprehensive (loss) income, net of taxes:
Defined benefit plans:
Actuarial (losses) gains arising during the period, net of taxes
(44)
39
62
Prior service costs arising during the period
—
—
(1)
Amortization of unrecognized amounts included in net periodic benefit costs
3
5
8
Foreign exchange losses
(1)
—
(1)
Other comprehensive (loss) income
(42)
44
68
Total comprehensive income
4,357
3,795
4,547
Total comprehensive income attributable to noncontrolling interests
(2,508)
(1,901)
(1,011)
Total comprehensive income attributable to common stockholders
$ 1,849
$ 1,894
$ 3,536
The accompanying Notes to Consolidated Financial Statements are an integral part of these consolidated financial statements.
66
Freeport | Powering Progress
C O N S O L I D A T E D S T A T E M E N T S O F C A S H F L O W S
Years Ended December 31,
2024
2023
2022
(In millions)
Cash flow from operating activities:
Net income
$ 4,399
$ 3,751
$ 4,479
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion and amortization
2,241
2,068
2,019
Net charges for environmental and asset retirement obligations, including accretion
622
295
369
Payments for environmental and asset retirement obligations
(234)
(250)
(274)
Stock-based compensation
109
109
95
Talc-related litigation charges
—
65
—
Net charges for defined pension and postretirement plans
35
62
45
Pension plan contributions
(78)
(75)
(54)
Net gain on early extinguishment of debt
—
(10)
(31)
Deferred income taxes
(76)
182
36
Changes in deferred profit on PT Freeport Indonesia’s sales to PT Smelting
—
(112)
(14)
Charges for social investment programs at PT Freeport Indonesia
103
84
84
Payments for social investment programs at PT Freeport Indonesia
(54)
(44)
(11)
Impairment of oil and gas properties
69
67
—
Other, net
53
(33)
(3)
Changes in working capital and other:
Accounts receivable
460
166
56
Inventories
(638)
(873)
(573)
Other current assets
(41)
(29)
(12)
Accounts payable and accrued liabilities
143
(161)
(73)
Accrued income taxes and timing of other tax payments
47
17
(999)
Net cash provided by operating activities
7,160
5,279
5,139
Cash flow from investing activities:
Capital expenditures:
North America copper mines
(1,033)
(761)
(597)
South America operations
(375)
(368)
(304)
Indonesia operations
(2,908)
(3,411)
(2,381)
Molybdenum mines
(117)
(84)
(33)
Other
(375)
(200)
(154)
Proceeds from sales of assets
19
27
108
Acquisition of additional ownership interest in Cerro Verde
(210)
—
—
Loans to PT Smelting for expansion
(28)
(129)
(65)
Other, net
(1)
(30)
(14)
Net cash used in investing activities
(5,028)
(4,956)
(3,440)
Cash flow from financing activities:
Proceeds from debt
2,251
1,781
5,735
Repayments of debt
(2,731)
(2,980)
(4,515)
Finance lease payments
(41)
(3)
(7)
Cash dividends and distributions paid:
Common stock
(865)
(863)
(866)
Noncontrolling interests
(1,833)
(625)
(840)
Treasury stock purchases
(59)
—
(1,347)
Contributions from noncontrolling interests
—
50
189
Proceeds from exercised stock options
29
47
125
Payments for withholding of employee taxes related to stock-based awards
(35)
(50)
(55)
Debt financing costs
—
(7)
(42)
Net cash used in financing activities
(3,284)
(2,650)
(1,623)
Net (decrease) increase in cash, cash equivalents and restricted cash and cash equivalents
(1,152)
(2,327)
76
Cash, cash equivalents and restricted cash and cash equivalents at beginning of year
6,063
8,390
8,314
Cash, cash equivalents and restricted cash and cash equivalents at end of year
$ 4,911
$ 6,063
$ 8,390
The accompanying Notes to Consolidated Financial Statements are an integral part of these consolidated financial statements.
C O N S O L I D A T E D B A L A N C E S H E E T S
2024 Annual Report
67
December 31,
2024
2023
(In millions, except par value)
ASSETS
Current assets:
Cash and cash equivalents
$ 3,923
$ 4,758
Restricted cash and cash equivalents
888
1,208
Trade accounts receivable
578
1,209
Value added and other tax receivables
564
455
Inventories:
Product
3,038
2,472
Materials and supplies, net
2,382
2,169
Mill and leach stockpiles
1,388
1,419
Other current assets
535
375
Total current assets
13,296
14,065
Property, plant, equipment and mine development costs, net
38,514
35,295
Long-term mill and leach stockpiles
1,225
1,336
Other assets
1,813
1,810
Total assets
$ 54,848
$ 52,506
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable and accrued liabilities
$ 4,057
$ 3,729
Accrued income taxes
859
786
Current portion of environmental and asset retirement obligations
320
316
Dividends payable
219
218
Current portion of debt
41
766
Total current liabilities
5,496
5,815
Long-term debt, less current portion
8,907
8,656
Environmental and asset retirement obligations, less current portion
5,404
4,624
Deferred income taxes
4,376
4,453
Other liabilities
1,887
1,648
Total liabilities
26,070
25,196
Equity:
Stockholders’ equity:
Common stock, par value $0.10, 1,624 shares and 1,619 shares issued, respectively
162
162
Capital in excess of par value
23,797
24,637
Accumulated deficit
(170)
(2,059)
Accumulated other comprehensive loss
(314)
(274)
Common stock held in treasury—187 shares and 184 shares, respectively, at cost
(5,894)
(5,773)
Total stockholders’ equity
17,581
16,693
Noncontrolling interests
11,197
10,617
Total equity
28,778
27,310
Total liabilities and equity
$ 54,848
$ 52,506
The accompanying Notes to Consolidated Financial Statements are an integral part of these consolidated financial statements.
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Stockholders’ Equity
Accumulated
Common Stock
Common Stock
Capital in
Other
Held in Treasury
Total
Number of At Par
Excess of Accumulated Comprehensive Number
Stockholders’ Noncontrolling
Total
Shares
Value
Par Value
Deficit
Loss
of Shares At Cost
Equity
Interests
Equity
(In millions)
Balance at January 1, 2022
1,603
$ 160
$ 25,875 $ (7,375)
$ (388) 146
$ (4,292)
$ 13,980
$ 9,039
$ 23,019
Exercised and issued stock-based awards
10
1
131
—
—
—
—
132
—
132
Stock-based compensation, including the tender of shares
—
—
88
—
—
2
(62)
26
(11)
15
Treasury stock purchases
—
—
—
—
—
35
(1,347)
(1,347)
—
(1,347)
Dividends
—
—
(864)
—
—
—
—
(864)
(820) (1,684)
Contributions from noncontrolling interests
—
—
92
—
—
—
—
92
97
189
Net income attributable to common stockholders
—
—
—
3,468
—
—
—
3,468
—
3,468
Net income attributable to noncontrolling interests
—
—
—
—
—
—
—
—
1,011
1,011
Other comprehensive income
—
—
—
—
68
—
—
68
—
68
Balance at December 31, 2022
1,613
161
25,322
(3,907)
(320) 183
(5,701)
15,555
9,316
24,871
Exercised and issued stock-based awards
6
1
68
—
—
—
—
69
—
69
Stock-based compensation, including the tender of shares
—
—
87
—
—
1
(72)
15
(1)
14
Dividends
—
—
(864)
—
—
—
—
(864)
(625) (1,489)
Contributions from noncontrolling interests
—
—
24
—
—
—
—
24
26
50
Net income attributable to common stockholders
—
—
—
1,848
—
—
—
1,848
—
1,848
Net income attributable to noncontrolling interests
—
—
—
—
—
—
—
—
1,903
1,903
Other comprehensive income (loss)
—
—
—
—
46
—
—
46
(2)
44
Balance at December 31, 2023
1,619
162
24,637
(2,059)
(274) 184
(5,773)
16,693
10,617
27,310
Exercised and issued stock-based awards
5
—
56
—
—
1
—
56
—
56
Stock-based compensation, including the tender of shares
—
—
92
—
—
1
(62)
30
(4)
26
Treasury stock purchases
—
—
—
—
—
1
(59)
(59)
—
(59)
Acquisition of additional ownership interest in Cerro Verde
—
—
(125)
—
—
—
—
(125)
(90)
(215)
Dividends
—
—
(866)
—
—
—
—
(866) (1,833) (2,699)
Change in consolidated subsidiary ownership interests
—
—
3
—
—
—
—
3
(1)
2
Net income attributable to common stockholders
—
—
—
1,889
—
—
—
1,889
—
1,889
Net income attributable to noncontrolling interests
—
—
—
—
—
—
—
—
2,510
2,510
Other comprehensive loss
—
—
—
—
(40)
—
—
(40)
(2)
(42)
Balance at December 31, 2024
1,624
$ 162
$ 23,797
$ (170)
$ (314) 187
$ (5,894)
$ 17,581
$ 11,197
$ 28,778
The accompanying Notes to Consolidated Financial Statements are an integral part of these consolidated financial statements.
C O N S O L I D A T E D S T A T E M E N T S O F E Q U I T Y
NOTE 1. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
Basis of Presentation. The consolidated financial statements of
Freeport-McMoRan Inc. (FCX) include the accounts of those
subsidiaries where it directly or indirectly has more than 50% of
the voting rights and/or has control over the subsidiary. As
of December 31, 2024, the most significant entities that FCX
consolidates include its 48.76%-owned subsidiary PT Freeport
Indonesia (PT-FI) and its wholly owned subsidiary, Freeport
Minerals Corporation (FMC). Refer to Note 2 for further discussion,
including FCX’s conclusion to consolidate PT-FI.
FMC’s unincorporated joint venture at Morenci is reflected
using the proportionate consolidation method (refer to Note 2).
Investments in unconsolidated companies over which FCX has
the ability to exercise significant influence, but does not control,
are accounted for under the equity method and include PT-FI’s
investment in PT Smelting (refer to Note 2). Investments in
unconsolidated companies owned less than 20%, and for which
FCX does not exercise significant influence, are recorded at
(i) fair value for those that have a readily determinable fair value or
(ii) cost, less any impairment, for those that do not have a readily
determinable fair value. All significant intercompany transactions
have been eliminated. Dollar amounts in tables are stated in
millions, except per share amounts.
Business Segments. FCX has organized its mining operations into
four primary divisions—North America copper mines, South
America operations, Indonesia operations and Molybdenum mines,
and operating segments that meet certain thresholds are reportable
segments. FCX’s reportable segments include the Morenci and
Cerro Verde copper mines, the integrated Indonesia operations
(including the Grasberg minerals district and PT-FI’s new smelter
and precious metals refinery (PMR)—collectively—PT-FI’s new
downstream processing facilities), the Rod & Refining operations
and Atlantic Copper Smelting & Refining (Atlantic Copper, S.L.U.
(Atlantic Copper)). Refer to Note 14 for further discussion.
Use of Estimates. The preparation of FCX’s financial statements
in conformity with accounting principles generally accepted in
the United States (U.S.) requires management to make estimates
and assumptions that affect the amounts reported in these
financial statements and accompanying notes. The more significant
areas requiring the use of management estimates include mineral
reserve estimation; asset lives for depreciation, depletion
and amortization; environmental obligations; asset retirement
obligations (AROs); estimates of recoverable copper in mill and
leach stockpiles; deferred taxes and valuation allowances; reserves
for contingencies and litigation; asset impairment, including
estimates used to derive future cash flows associated with those
assets; pension benefits; and valuation of derivative instruments.
Actual results could differ from those estimates.
Functional Currency. The functional currency for the majority of
FCX’s foreign operations is the U.S. dollar. For foreign subsidiaries
whose functional currency is the U.S. dollar, monetary assets and
liabilities denominated in the local currency are translated at current
exchange rates, and non-monetary assets and liabilities, such as
inventories, property, plant, equipment and mine development costs,
are translated at historical exchange rates. Gains and losses
resulting from translation of such account balances are included in
other income, net, as are gains and losses from foreign currency
transactions. Foreign currency net gains totaled $17 million in 2024,
$20 million in 2023 and $9 million in 2022.
Cash and Cash Equivalents. Highly liquid investments purchased
with maturities of three months or less are considered cash equivalents.
Restricted Cash and Cash Equivalents. Restricted cash and cash
equivalents are classified as a current or long-term asset based on
the timing and nature of when or how the cash is expected to be
used or when the restrictions are expected to lapse. FCX’s restricted
cash and cash equivalents are primarily related to a portion of
PT-FI’s export proceeds required to be temporarily deposited in
Indonesia banks for 90 days in accordance with Indonesia regulations,
assurance bonds to support PT-FI’s commitment for smelter
development in Indonesia, and guarantees and commitments for
certain mine closure obligations. Refer to Notes 10 and 12 for
further information.
Inventories. Inventories include product, materials and supplies,
and mill and leach stockpiles. Inventories are stated at the lower of
weighted-average cost or net realizable value (NRV).
Product. Product inventories represent copper, gold, and
molybdenum products in various salable forms that are valued
based on the weighted-average cost of source material plus
applicable conversion costs at our processing facilities. Product
inventories include labor and benefits, supplies, energy, depreciation,
depletion, amortization, site overhead costs and other necessary
costs associated with the extraction and processing of ore,
such as mining, milling, smelting, leaching, solution extraction and
electrowinning (SX/EW), refining, roasting and chemical
processing. Product inventories exclude corporate general and
administrative costs.
N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
2024 Annual Report
69
Materials and Supplies, Net. Materials and supplies inventory of
$2.4 billion at December 31, 2024, and $2.2 billion at December 31,
2023, is net of obsolescence reserves totaling $54 million
at December 31, 2024, and $41 million at December 31, 2023.
Mill and Leach Stockpiles. Mill and leach stockpiles are work-in-
process inventories for FCX’s mining operations. Estimated
metals in stockpiles not expected to be recovered within the next
12 months are classified as long-term. Mill and leach stockpiles
contain ore that has been extracted from an ore body and is
available for metal recovery. Mill stockpiles contain sulfide ores,
and recovery of metal is through milling, concentrating and
smelting and refining or, alternatively, by concentrate leaching.
Leach stockpiles contain oxide ores and certain secondary sulfide
ores and recovery of metal is through exposure to acidic solutions
that dissolve contained copper and deliver it in solution to
extraction processing facilities (i.e., SX/EW). The recorded cost
of mill and leach stockpiles includes mining and haulage costs
incurred to deliver ore to stockpiles, depreciation, depletion,
amortization and site overhead costs. Material is removed from the
stockpiles at a weighted-average cost per pound. Each mine site
maintains one work-in-process balance on a weighted-average
cost basis for each process (i.e., leach, mill or concentrate leach)
regardless of the number of stockpile systems at that site.
Because it is impracticable to determine copper contained in
mill and leach stockpiles by physical count, reasonable estimation
methods are employed. The quantity of material delivered to mill
and leach stockpiles is based on surveyed volumes of mined
material and daily production records. Sampling and assaying of
blasthole cuttings determine the estimated copper grade of the
material delivered to mill and leach stockpiles.
Expected copper recoveries for mill stockpiles are determined
by metallurgical testing. The recoverable copper in mill stockpiles,
once entered into the production process, can be produced into
copper concentrate almost immediately.
Expected copper recoveries for leach stockpiles are determined
using small-scale laboratory tests, small- to large-scale column
testing (which simulates the production process), historical trends
and other factors, including mineralogy of the ore and rock type.
Total copper recovery in leach stockpiles can vary significantly
from a low percentage to more than 80% depending on several
variables, including processing methodology, processing variables,
mineralogy and particle size of the rock. For newly placed material
on active stockpiles, as much as 80% of the total copper recovery
may occur during the first year, and the remaining copper may be
recovered over many years.
Process rates and copper recoveries for mill and leach stockpiles
are monitored regularly, and recovery estimates are adjusted
annually based on new information and as related technology and
processing methods change. Recovery adjustments will typically
result in a future impact to the value of the material removed from
the stockpiles at a revised weighted-average cost per pound of
recoverable copper. For example, an increase in recovery rates
increases recoverable copper in the leach stockpiles resulting in
a lower weighted-average cost per pound of recoverable copper
and a decrease in recovery rates decreases recoverable copper
in the leach stockpiles and results in a higher weighted-average
cost per pound of recoverable copper.
Based on an annual review of mill and leach stockpiles, FCX
increased its estimated consolidated recoverable copper in certain
leach stockpiles, net of joint venture interests, by 164 million pounds
in 2024 and 73 million pounds in 2023. These revised estimates did
not have a material impact on the weighted-average cost per pound
of recoverable copper or FCX’s consolidated site production and
delivery costs in 2024 or 2023.
Property, Plant, Equipment and Mine Development Costs. Property,
plant, equipment and mine development costs are carried at cost.
Mineral exploration costs, as well as drilling and other costs incurred
for the purpose of converting mineral resources to proven and
probable mineral reserves or identifying new mineral resources at
development or production stage properties, are charged to expense
as incurred. Development costs are capitalized beginning after
proven and probable mineral reserves have been established.
Development costs include costs incurred resulting from mine
pre-production activities undertaken to gain access to proven and
probable mineral reserves, including shafts, adits, drifts, ramps,
permanent excavations, infrastructure and removal of overburden.
For underground mines certain costs related to panel development,
such as undercutting and drawpoint development, are also
capitalized as mine development costs until production reaches
sustained design capacity for the mine. After reaching design
capacity, the underground mine transitions to the production
phase and panel development costs are allocated to inventory and
included as a component of production and delivery costs.
Additionally, interest expense allocable to the cost of developing
mines and to constructing new facilities is capitalized until assets
are ready for their intended use.
Expenditures for replacements and improvements are capitalized.
Costs related to periodic scheduled maintenance (i.e., turnarounds)
are charged to expense as incurred. Depreciation for mining and
milling life-of-mine assets, infrastructure and other common costs is
determined using the unit-of-production (UOP) method based on
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N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
total estimated recoverable proven and probable copper reserves
(for primary copper mines) and proven and probable molybdenum
reserves (for primary molybdenum mines). Development costs
and acquisition costs for proven and probable mineral reserves
that relate to a specific ore body are depreciated using the UOP
method based on estimated recoverable proven and probable
mineral reserves for the ore body benefited. Depreciation, depletion
and amortization using the UOP method is recorded upon
extraction of the recoverable copper or molybdenum from the ore
body or production of finished goods (as applicable), at which time
it is allocated to inventory cost and then included as a component
of production and delivery costs. Other assets are depreciated on a
straight-line basis over estimated useful lives for the related assets
of up to 50 years for buildings and 3 to 50 years for machinery and
equipment, and mobile equipment.
Included in property, plant, equipment and mine development
costs is value beyond proven and probable mineral reserves (VBPP),
primarily resulting from FCX’s acquisition of FMC. The concept of
VBPP may be interpreted differently by different mining companies.
FCX’s VBPP is attributable to (i) measured and indicated mineral
resources that FCX believes could be brought into production with
the establishment or modification of required permits and should
market conditions and technical assessments warrant, (ii) inferred
mineral resources and (iii) exploration potential.
Carrying amounts assigned to VBPP are not charged to expense
until the VBPP becomes associated with additional proven and
probable mineral reserves and the reserves are produced or the
VBPP is determined to be impaired. Additions to proven and
probable mineral reserves for properties with VBPP will carry with
them the value assigned to VBPP at the date acquired, less any
impairment amounts. Refer to Note 3 for further discussion.
Impairment of Long-Lived Mining Assets. FCX assesses the
carrying values of its long-lived mining assets for impairment
when events or changes in circumstances indicate that the related
carrying amounts of such assets may not be recoverable. In
evaluating long-lived mining assets for recoverability, estimates of
pre-tax undiscounted future cash flows of FCX’s individual mines
are used. An impairment is considered to exist if total estimated
undiscounted future cash flows are less than the carrying amount
of the asset. Once it is determined that an impairment exists,
an impairment loss is measured as the amount by which the asset
carrying value exceeds its fair value. The estimated undiscounted
cash flows used to assess recoverability of long-lived assets and
to measure the fair value of FCX’s mining operations are derived
from current business plans, which are developed using near-term
price forecasts reflective of the current price environment and
management’s projections for long-term average metal prices. In
addition to near- and long-term metal price assumptions, other
key assumptions include estimates of commodity-based and other
input costs; proven and probable mineral reserves estimates,
including the timing and cost to develop and produce the reserves;
VBPP estimates; and the use of appropriate discount rates in
the measurement of fair value. FCX believes its estimates and
models used to determine fair value are similar to what a market
participant would use. As quoted market prices are unavailable
for FCX’s individual mining operations, fair value is determined through
the use of after-tax discounted estimated future cash flows (i.e.,
Level 3 measurement).
Deferred Mining Costs. Stripping costs (i.e., the costs of removing
overburden and waste material to access mineral deposits) incurred
during the production phase of an open-pit mine are considered
variable production costs and are included as a component of
inventory produced during the period in which stripping costs are
incurred. Major development expenditures, including stripping costs
to prepare unique and identifiable areas outside the current mining
area for future production that are considered to be pre-production
mine development, are capitalized and amortized using the UOP
method based on estimated recoverable proven and probable
mineral reserves for the ore body benefited. However, where a
second or subsequent pit or major expansion is considered to
be a continuation of existing mining activities, stripping costs are
accounted for as a current production cost and a component of
the associated inventory.
Environmental Obligations. Environmental expenditures are
charged to expense or capitalized, depending upon their future
economic benefits. Accruals for such expenditures are recorded
when it is probable that obligations have been incurred and the
costs can be reasonably estimated. Environmental obligations
attributed to the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980 (CERCLA) or analogous
state programs are considered probable when a claim is asserted,
or is probable of assertion, and FCX, or any of its subsidiaries, have
been associated with the site. Other environmental remediation
obligations are considered probable based on specific facts and
circumstances. FCX’s estimates of these costs are based on
an evaluation of various factors, including currently available facts,
existing technology, presently enacted laws and regulations,
remediation experience, whether or not FCX is a potentially responsible
party (PRP) and the ability of other PRPs to pay their allocated
portions. With the exception of those obligations assumed in the
acquisition of FMC that were initially recorded at estimated fair
N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
2024 Annual Report
71
values (refer to Note 10 for further discussion), environmental
obligations are recorded on an undiscounted basis. Where the
available information is sufficient to estimate the amount of the
obligation, that estimate has been used. Where the information
is only sufficient to establish a range of probable liability and no
point within the range is more likely than any other, the lower end
of the range has been used. Possible recoveries of some of these
costs from other parties are not recognized in the consolidated
financial statements until they become probable. Legal costs
associated with environmental remediation (such as fees to third-
party legal firms for work relating to determining the extent and
type of remedial actions and the allocation of costs among PRPs)
are included as part of the estimated obligation.
Environmental obligations assumed in the 2007 acquisition
of FMC, which were initially recorded at fair value and estimated on
a discounted basis, are accreted to full value over time through
charges to interest expense. Adjustments arising from changes in
amounts and timing of estimated costs and settlements may
result in increases and decreases in these obligations and are
calculated in the same manner as they were initially estimated.
Unless these adjustments qualify for capitalization, changes in
environmental obligations are charged to operating income when
they occur.
FCX performs a comprehensive review of its environmental
obligations annually and also reviews changes in facts and
circumstances associated with these obligations at least quarterly.
Asset Retirement Obligations. FCX records the fair value of
estimated AROs associated with tangible long-lived assets in the
period incurred. AROs associated with long-lived assets are those
for which there is a legal obligation to settle under existing or
enacted law, statute, written or oral contract or by legal construction.
These obligations, which are initially estimated based on discounted
cash flow estimates, are accreted to full value over time through
charges to production and delivery costs. In addition, asset
retirement costs (ARCs) are capitalized as part of the related asset’s
carrying value and are depreciated over the asset’s useful life.
For mining operations, reclamation costs for disturbances are
recognized as an ARO and as a related ARC in the period of the
disturbance and depreciated primarily on a UOP basis. FCX’s
AROs for mining operations consist primarily of costs associated
with mine reclamation and closure activities. These activities,
which are site specific, generally include costs for earthwork,
revegetation, water treatment and demolition.
For non-operating properties and operating mines whose
reclamation-related assets have been fully depreciated, changes to
the ARO are recorded in production and delivery costs.
At least annually, FCX reviews its ARO estimates for changes in
the projected timing of certain reclamation and closure/restoration
costs, changes in cost estimates and additional AROs incurred
during the period. Refer to Note 10 for further discussion.
Revenue Recognition. FCX recognizes revenue for its products
upon transfer of control in an amount that reflects the consideration
it expects to receive in exchange for those products. Transfer of
control is in accordance with the terms of customer contracts, which
is generally upon shipment or delivery of the product. While payment
terms vary by contract, terms generally include payment to be
made within 30 days, but not longer than 60 days. Certain of FCX’s
concentrate and cathode sales contracts also provide for provisional
pricing, which is accounted for as an embedded derivative (refer to
Note 12 for further discussion). For provisionally priced sales, 90% to
100% of the provisional invoice amount is collected upon shipment
or within 20 days, and final balances are settled in a contractually
specified future month (generally one to four months from the
shipment date) based on quoted monthly average copper settlement
prices on the London Metal Exchange (LME) or the Commodity
Exchange Inc. (COMEX), and quoted monthly average London
Bullion Market Association (London) PM gold prices.
FCX’s product revenues are also recorded net of treatment
charges, royalties and export duties. Moreover, because a portion of
the metals contained in copper concentrate is unrecoverable as a
result of the smelting process, FCX’s revenues from concentrate
sales are also recorded net of allowances based on the quantity and
value of these unrecoverable metals. These allowances are a
negotiated term of FCX’s contracts and vary by customer. Treatment
and refining charges represent payments or price adjustments to
smelters and refiners that are generally fixed. Refer to Note 14 for a
summary of revenue by product type.
Gold sales are priced according to individual contract terms,
generally the average London PM gold price for a specified month
near the month of shipment.
The majority of FCX’s molybdenum sales are priced based on the
Platts Metals Daily Molybdenum Dealer Oxide weekly average price,
plus conversion premiums for products that undergo additional
processing, such as ferromolybdenum and molybdenum chemical
products, for the month prior to the month of shipment.
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N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
Stock-Based Compensation. Compensation costs for share-based
payments to employees are measured at fair value and charged
to expense over the requisite service period for awards that are
expected to vest. The fair value of stock options is determined
using the Black-Scholes-Merton option valuation model. The fair
value for stock-settled restricted stock units (RSUs) is based on
FCX’s stock price on the date of grant. Shares of common stock are
issued at the vesting date for stock-settled RSUs. The fair value
of performance share units (PSUs) are determined using FCX’s
stock price and a Monte-Carlo simulation model. The fair value for
liability-classified awards (i.e., cash-settled RSUs) is remeasured
each reporting period using FCX’s stock price. FCX has elected to
recognize compensation costs for stock option awards that vest
over several years on a straight-line basis over the vesting period,
and for RSUs using the graded-vesting method over the vesting
period. Refer to Note 8 for further discussion.
Earnings Per Share. FCX calculates its basic net income per share
of common stock under the two-class method and calculates
its diluted net income per share of common stock using the more
dilutive of the two-class method or the treasury-stock method.
Basic net income per share of common stock was computed by
dividing net income attributable to common stockholders (after
deducting undistributed dividends and earnings allocated to
participating securities) by the weighted-average shares of common
stock outstanding during the year. Diluted net income per share
of common stock was calculated by including the basic weighted-
average shares of common stock outstanding adjusted for the
effects of all potential dilutive shares of common stock, unless their
effect would be antidilutive.
Reconciliations of net income and weighted-average shares of
common stock outstanding for purposes of calculating basic and
diluted net income per share for the years ended December 31 follow:
N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
2024 Annual Report
73
2024
2023
2022
Net income
$ 4,399
$ 3,751
$ 4,479
Net income attributable to noncontrolling interests
(2,510)
(1,903)
(1,011)
Undistributed dividends and earnings allocated to participating securities
(6)
(6)
(7)
Net income attributable to common stockholders
$ 1,883
$ 1,842
$ 3,461
(shares in millions)
Basic weighted-average shares of common stock outstanding
1,438
1,434
1,441
Add shares issuable upon exercise or vesting of dilutive stock options, PSUs and RSUs
7
9
10
Diluted weighted-average shares of common stock outstanding
1,445
1,443
1,451
Net income per share attributable to common stockholders:
Basic
$ 1.31
$ 1.28
$ 2.40
Diluted
$ 1.30
$ 1.28
$ 2.39
Outstanding stock options with exercise prices greater than the
average market price of FCX’s common stock during the year are
excluded from the computation of diluted net income per share
of common stock. Excluded shares of common stock associated
with outstanding stock options totaled less than 1 million shares
in 2024 and 2023 and 1 million shares in 2022.
Global Intangible Low-Taxed Income (GILTI). FCX has elected to
treat taxes due on future U.S. inclusions in taxable income related
to GILTI as a current period expense when incurred.
New Accounting Standards. FCX did not adopt any new accounting
standards in 2024 that had a material impact on its consolidated
financial statements.
Segment Reporting. In November 2023, the Financial Accounting
Standards Board (FASB) issued an accounting standards update
(ASU) related to segment reporting that requires disclosure of
significant segment expenses that are regularly provided to the
chief operating decision maker (CODM) and included within each
reported measure of segment profit or loss, the title and position
of the CODM, and an explanation of how the CODM uses the
reported measure(s) of segment profit or loss in assessing
segment performance and deciding how to allocate resources.
This ASU is effective for FCX’s consolidated financial statements
for the year ended December 31, 2024, and subsequent interim
consolidated financial statements, and did not materially impact
FCX’s segment reporting as presented within Note 14.
Income Taxes. In December 2023, the FASB issued an ASU
requiring enhancements to disclosures related to income taxes,
including the rate reconciliation and information on income
taxes paid. This ASU is effective for FCX’s consolidated financial
statements for the year ended December 31, 2025.
Disaggregation of Expenses. In November 2024, the FASB
issued an ASU requiring entities to provide disaggregated
disclosures of specified categories of expenses that are included
in relevant line items on the face of the income statement,
including: purchases of inventory, employee compensation,
depreciation, intangible asset amortization and depletion. This
ASU is effective for FCX’s consolidated financial statements
for the year ended December 31, 2027, and subsequent interim
consolidated financial statements.
Subsequent Events. FCX evaluated events after December 31, 2024,
and through the date the consolidated financial statements
were issued, and determined any events or transactions occurring
during this period that would require recognition or disclosure are
appropriately addressed in these consolidated financial statements.
NOTE 2. OWNERSHIP IN SUBSIDIARIES
AND JOINT VENTURES
Ownership in Subsidiaries. FCX owns 100% of FMC. FMC produces
copper and molybdenum from mines in North America and
South America. At December 31, 2024, FMC’s operating mines in
North America were Morenci, Bagdad, Safford (including Lone Star),
Sierrita and Miami located in Arizona; Tyrone and Chino located
in New Mexico; and Henderson and Climax located in Colorado.
FMC has a 72% interest in Morenci (refer to “Joint Ventures.
Sumitomo and SMM Morenci, Inc.”) and owns 100% of the other
North America mines. At December 31, 2024, operating mines in
South America were Cerro Verde (55.08% owned—refer to
“Cerro Verde” below) located in Peru and El Abra (51% owned)
located in Chile. At December 31, 2024, FMC’s net assets totaled
$17.4 billion and its accumulated deficit totaled $13.5 billion. FCX
had no loans to FMC outstanding at December 31, 2024 and 2023.
FCX owns 48.76% of PT-FI (refer to “PT-FI Divestment” below).
At December 31, 2024, PT-FI’s net assets totaled $16.6 billion and its
retained earnings totaled $12.1 billion. FCX had no loans to PT-FI
outstanding at December 31, 2024 and 2023.
FCX owns 100% of Atlantic Copper (FCX’s smelting and
refining unit in Spain). At December 31, 2024, Atlantic Copper’s
net assets totaled $132 million and its accumulated deficit totaled
$407 million. FCX had loans to Atlantic Copper outstanding
totaling $644 million at December 31, 2024, and $611 million at
December 31, 2023.
Cerro Verde. In September 2024, FCX purchased 5.3 million
shares of Cerro Verde common stock for a total cost of $210 million,
increasing FCX’s ownership interest in Cerro Verde to 55.08%
from 53.56%. As a result of the transaction, the carrying value of
Cerro Verde’s noncontrolling interest was reduced by $90 million,
with $125 million recorded to capital in excess of par value,
including a $5 million deferred tax impact.
PT-FI Divestment. On December 21, 2018, FCX completed the
transaction with the Indonesia government regarding PT-FI’s
long-term mining rights and share ownership (the 2018 Transaction).
Pursuant to the divestment agreement and related documents,
PT Mineral Industri Indonesia (MIND ID), an Indonesia state-owned
enterprise, acquired all of Rio Tinto plc’s (Rio Tinto) interests
associated with its joint venture with PT-FI (the former Rio Tinto
Joint Venture) and 100% of FCX’s interests in PT Indonesia Papua
Metal Dan Mineral (PTI).
In connection with the 2018 Transaction, PT-FI acquired all of the
common stock of PT Rio Tinto Indonesia that held the former
Rio Tinto Joint Venture interest. After the 2018 Transaction, MIND
ID’s (26.24%) and PTI’s (25.00%) collective share ownership of
PT-FI totals 51.24% and FCX’s share ownership totals 48.76%. The
arrangements provide for FCX and the other pre-transaction
PT-FI shareholders (i.e., MIND ID) to retain the economics of the
revenue and cost sharing arrangements under the former Rio Tinto
Joint Venture. As a result, FCX’s economic interest, including
the attribution of net income or loss and dividends paid, in PT-FI
approximated 81% through 2022 and is 48.76% in 2023 and
thereafter (see “Attribution of PT-FI Net Income or Loss” below).
FCX, PT-FI, PTI and MIND ID entered into a shareholders
agreement (the PT-FI Shareholders Agreement), which includes
provisions related to the governance and management of PT-FI.
FCX considered the terms of the PT-FI Shareholders Agreement and
related governance structure, including whether MIND ID has
substantive participating rights, and concluded that FCX has retained
control and would continue to consolidate PT-FI in its financial
statements following the 2018 Transaction. Among other terms, the
governance arrangements under the PT-FI Shareholders Agreement
transfers control over the management of PT-FI’s mining operations
to an operating committee, which is controlled by FCX. Additionally,
as discussed above, the existing PT-FI shareholders retained the
economics of the revenue and cost sharing arrangements under the
former Rio Tinto Joint Venture, so that FCX’s economic interest in
the project through 2041 will not be significantly affected by the 2018
Transaction. FCX believes its conclusion to continue to consolidate
PT-FI in its financial statements is in accordance with the U.S.
Securities and Exchange Commission (SEC) Regulation S-X, Rule
3A-02 (a), which provides for situations in which consolidation of an
entity, notwithstanding the lack of majority ownership, is necessary
to present fairly the financial position and results of operations of the
registrant, because of the existence of a parent-subsidiary
relationship by means other than recorded ownership of voting stock.
Attribution of PT-FI Net Income or Loss. FCX concluded that
the attribution of PT-FI’s net income or loss from December 21, 2018
(the date of the divestment transaction), through December 31, 2022
(the Initial Period), should be based on FCX’s and MIND ID’s
economic interest, as previously discussed. PT-FI’s cumulative net
income during the Initial Period totaled $6.0 billion, of which
$4.9 billion was attributed to FCX.
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Beginning January 1, 2023, the attribution of PT-FI’s net income
or loss is based on equity ownership percentages (48.76% for
FCX, 26.24% for MIND ID and 25.00% for PTI), except for net
income in 2023 associated with the sale of approximately 190,000
ounces of gold because PT-FI did not achieve the Gold Target (as
defined in the PT-FI Shareholders Agreement), and net income in
2024 associated with the closure of its 2021 corporate income tax
audit and resolution of the framework for Indonesia disputed tax
matters (refer to Note 9), which were attributed approximately
81% to FCX. For all of its other partially owned consolidated
subsidiaries, FCX attributes net income or loss based on equity
ownership percentages.
Joint Ventures.
Sumitomo and SMM Morenci, Inc. FMC owns a 72% undivided interest
in Morenci via an unincorporated joint venture. The remaining
28% is owned by Sumitomo (15%) and SMM Morenci, Inc. (13%).
Each partner takes in kind its share of Morenci’s production.
FMC purchased 15 million pounds during 2024 and 46 million pounds
during 2023 of Morenci’s copper cathode from Sumitomo and
SMM Morenci, Inc. at market prices for $63 million and $177 million,
respectively. FMC had receivables from Sumitomo and SMM
Morenci, Inc. totaling $23 million at December 31, 2024, and $17 million
at December 31, 2023.
PT Smelting. PT Smelting is an Indonesia company that owns a
copper smelter and refinery in Gresik, Indonesia. In 1996, PT-FI
entered into a joint venture and shareholder agreement with
Mitsubishi Materials Corporation (MMC) to jointly construct the
PT Smelting facilities. PT Smelting commenced operations in 1999.
In December 2023, PT Smelting completed the expansion of its
capacity by 30% to process approximately 1.3 million metric tons of
copper concentrate per year. The project was funded by PT-FI
with loans totaling $254 million that converted to equity effective
June 30, 2024, increasing PT-FI’s common stock ownership in
PT Smelting to 66% from 39.5%. MMC owns the remaining 34% of
PT Smelting’s outstanding common stock and serves as the
operator of the facilities.
FCX has determined that PT Smelting is a variable interest entity,
however, as mutual consent of both PT-FI and MMC is required
to make the decisions that most significantly impact the economic
performance of PT Smelting, PT-FI is not the primary beneficiary.
As PT-FI has the ability to exercise significant influence over
PT Smelting, PT-FI is continuing to account for its investment in
PT Smelting under the equity method (refer to Note 4).
PT-FI’s maximum exposure to loss is its investment in PT Smelting
(refer to Note 4). PT-FI’s equity in PT Smelting’s earnings totaled
$8 million in 2024, $10 million in 2023 and $24 million in 2022.
Beginning January 1, 2023, PT-FI’s commercial arrangement
with PT Smelting changed from a copper concentrate sales
agreement to a tolling arrangement. Under this arrangement, PT-FI
pays PT Smelting a tolling fee to smelt and refine its copper
concentrate and PT-FI retains title to all products for sale to third
parties (i.e., there are no further sales from PT-FI to PT Smelting).
PT-FI recorded tolling-related charges of $326 million in 2024 and
$183 million in 2023.
NOTE 3. PROPERTY, PLANT, EQUIPMENT
AND MINE DEVELOPMENT COSTS, NET
The components of net property, plant, equipment and mine
development costs follow:
December 31,
2024
2023
Proven and probable mineral reserves
$ 7,159
$ 7,160
VBPP
358
359
Mine development and other
12,828
12,265
Buildings and infrastructure
10,667
10,165
Machinery and equipment
16,337
15,246
Mobile equipment
5,597
4,986
Construction in progress
9,364
6,945
Oil and gas properties
27,485
27,441
Total
89,795
84,567
Accumulated depreciation, depletion and amortizationa
(51,281)
(49,272)
Property, plant, equipment and mine
development costs, net
$ 38,514
$ 35,295
a. Includes accumulated amortization for oil and gas properties of $27.4 billion at December 31, 2024
and 2023.
FCX recorded $1.6 billion for VBPP in connection with its 2007
acquisition of FMC (excluding $0.6 billion associated with mining
operations that were subsequently sold) and transferred $0.8 billion
to proven and probable mineral reserves through 2024 (approximately
$1 million in both 2024 and 2023). Cumulative impairments of
and adjustments to VBPP total $0.5 billion, which were primarily
recorded in 2008.
Capitalized interest, which primarily related to FCX’s mining
operations’ capital projects, including the construction and
development of PT-FI’s new downstream processing facilities, totaled
$391 million in 2024, $267 million in 2023 and $150 million in 2022.
During the three-year period ended December 31, 2024, no material
impairments of FCX’s long-lived mining assets were recorded.
N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
2024 Annual Report
75
NOTE 4. OTHER ASSETS
The components of other assets follow:
December 31,
2024
2023
Intangible assetsa
$ 428
$ 422
Legally restricted trust assetsb
217
212
Disputed tax assessments:c
Cerro Verde
275
274
PT-FI
10
10
Investments:
PT Smeltingd
354
123
Fixed income, equity securities and other
102
84
Restricted time depositse
100
97
Cloud computing arrangements
151
76
Long-term receivable for taxesf
43
70
Long-term employee receivables
24
26
Prepaid rent and deposits
9
39
Loans to PT Smelting for expansiond
—
233
Contingent consideration associated with sales of assetsg
—
38
Other
100
106
Total other assets
$1,813
$ 1,810
a. Indefinite-lived intangible assets totaled $214 million at December 31, 2024 and 2023. Definite-lived
intangible assets totaled $214 million at December 31, 2024, and $208 million at December 31, 2023,
which were net of accumulated amortization totaling $46 million and $43 million, respectively.
b. Reflects amounts held in trusts for AROs related to properties in New Mexico (refer to Note 10).
c. Refer to Note 10.
d. Refer to Note 2.
e. Relates to PT-FI’s regulatory commitments (refer to Notes 10 and 12).
f. Includes tax overpayments and refunds not expected to be realized within the next 12 months.
g. Refer to Note 13.
NOTE 5. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
The components of accounts payable and accrued liabilities follow:
December 31,
2024
2023
Accounts payable
$ 2,789
$ 2,466
Salaries, wages and other compensation
361
343
Accrued interesta
135
146
Pension, postretirement, postemployment and
other employee benefitsb
128
129
Leasesb,c
98
84
Deferred revenue
91
161
Accrued taxes, other than income taxes
81
88
Community development programs
75
58
PT-FI administrative fined
59
55
PT-FI contingenciese
49
67
MIND ID indemnificationf
49
—
Litigation accruals
34
51
Other
108
81
Total accounts payable and accrued liabilities
$ 4,057
$ 3,729
a. Third-party interest paid, net of capitalized interest, was $206 million in 2024, $419 million in 2023
and $417 million in 2022.
b. Refer to Note 7 for long-term portion.
c. Refer to Note 11.
d. Refer to Note 10.
e. Primarily reflects Indonesia tax matters. Refer to Note 10.
f. Refer to Note 11. At December 31, 2023, the MIND ID indemnification balance was included in other
long-term liabilities (refer to Note 7).
NOTE 6. DEBT
FCX’s debt at December 31, 2024, is net of reductions of $58 million
($67 million at December 31, 2023) for unamortized net
discounts and unamortized debt issuance costs. The components
of debt follow:
December 31,
2024
2023
Revolving credit facilities:
FCX
$
—
$
—
PT-FI
250
—
Cerro Verde
—
—
Senior notes and debentures:
Issued by FCX:
4.55% Senior Notes due 2024
—
730
5.00% Senior Notes due 2027
449
448
4.125% Senior Notes due 2028
484
483
4.375% Senior Notes due 2028
431
430
5.25% Senior Notes due 2029
469
468
4.25% Senior Notes due 2030
447
446
4.625% Senior Notes due 2030
589
588
5.40% Senior Notes due 2034
724
723
5.450% Senior Notes due 2043
1,688
1,689
Issued by PT-FI:
4.763% Senior Notes due 2027
747
746
5.315% Senior Notes due 2032
1,491
1,490
6.200% Senior Notes due 2052
745
744
Issued by FMC:
7 ⅛% Debentures due 2027
115
115
9 1/2% Senior Notes due 2031
119
121
6 1/8% Senior Notes due 2034
119
118
Other
81
83
Total debt
8,948
9,422
Less current portion of debt
(41)
(766)
Long-term debt
$8,907
$ 8,656
Revolving Credit Facilities.
FCX. FCX and PT-FI have a $3.0 billion, unsecured revolving credit
facility that matures in October 2027. Under the terms of the
revolving credit facility, FCX may obtain loans and issue letters of
credit in an aggregate amount of up to $3.0 billion, with a $1.5 billion
sublimit on the issuance of letters of credit and a $500 million
limit on PT-FI’s borrowing capacity. At December 31, 2024, there
were no borrowings and $7 million in letters of credit issued under
FCX’s revolving credit facility. Interest on loans made under the
revolving credit facility may, at the option of FCX or PT-FI, be
determined based on the Secured Overnight Financing Rate (SOFR)
plus a spread to be determined by reference to a grid based on
FCX’s credit rating.
The revolving credit facility contains customary affirmative
covenants and representations, and also contains various negative
covenants that, among other things and subject to certain
exceptions, restrict the ability of FCX’s subsidiaries that are not
borrowers or guarantors to incur additional indebtedness
(including guarantee obligations) and the ability of FCX or FCX’s
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subsidiaries to: create liens on assets; enter into sale and leaseback
transactions; engage in mergers, liquidations and dissolutions;
and sell assets. In addition, the revolving credit facility contains a
total leverage ratio financial covenant.
PT-FI. At December 31, 2024, PT-FI had $250 million in borrowings
outstanding under its $1.75 billion senior unsecured revolving credit
facility that matures in November 2028. PT-FI’s revolving credit
facility is available for its general corporate purposes, including to
fund PT-FI’s projects related to its new downstream processing
facilities. Interest on loans made under PT-FI’s revolving credit facility
are determined based on the SOFR plus a margin.
PT-FI’s revolving credit facility contains customary affirmative
covenants and representations and also contains standard
negative covenants that, among other things, restrict, subject to
certain exceptions, the ability of PT-FI to incur additional
indebtedness; create liens on assets; enter into sale and leaseback
transactions; sell assets; and modify or amend the shareholders
agreement or related governance structure. The credit facility
also contains financial covenants governing maximum total
leverage and minimum interest expense coverage and other
covenants addressing certain environmental and social
compliance requirements.
Cerro Verde. At December 31, 2024, Cerro Verde had no
borrowings outstanding under its $350 million senior unsecured
revolving credit facility that matures in May 2027. Cerro Verde’s
revolving credit facility contains customary representations and
affirmative and negative covenants.
At December 31, 2024, FCX, PT-FI and Cerro Verde were in
compliance with their respective credit facility’s covenants.
Senior Notes.
FCX. In November 2024, FCX repaid $0.7 billion for the balance of
its maturing 4.55% Senior Notes.
In 2023, FCX purchased $0.2 billion aggregate principal amount
of its senior notes in open-market transactions for a total cost
of $0.2 billion and recorded gains on early extinguishment of debt
of $10 million. In 2022, FCX purchased $1.1 billion aggregate
principal amount of its senior notes in open market transactions for
a total cost of $1.0 billion and recorded gains on early extinguishment
of debt of $44 million. FCX has not purchased senior notes in
open-market transactions since July 2023.
The senior notes listed below are redeemable in whole or in
part, at the option of FCX, at specified redemption prices prior to
the dates stated below and beginning on the dates stated below
at 100% of principal.
Debt Instrument
Date
5.00% Senior Notes due 2027
September 1, 2025
4.125% Senior Notes due 2028
March 1, 2026
4.375% Senior Notes due 2028
August 1, 2026
5.25% Senior Notes due 2029
September 1, 2027
The senior notes listed below are redeemable in whole or in part,
at the option of FCX, at a make-whole redemption price prior to the
dates stated below, at specified redemption prices beginning on the
dates stated below, and at 100% of principal two years before maturity.
Debt Instrument
Date
4.25% Senior Notes due 2030
March 1, 2025
4.625% Senior Notes due 2030
August 1, 2025
The senior notes listed below are redeemable in whole or in part,
at the option of FCX, at a make-whole redemption price prior to the
dates stated below and beginning on the dates stated below at
100% of principal.
Debt Instrument
Date
5.40% Senior Notes due 2034
May 14, 2034
5.450% Senior Notes due 2043
September 15, 2042
FCX’s senior notes contain limitations on liens and rank equally
with FCX’s other existing and future unsecured and unsubordinated
indebtedness.
PT-FI. In April 2022, PT-FI completed the sale of $3.0 billion
aggregate principal amount of unsecured senior notes, consisting
of $750 million of 4.763% Senior Notes due 2027, $1.5 billion of
5.315% Senior Notes due 2032 and $750 million of 6.200% Senior
Notes due 2052. PT-FI used $0.6 billion of the net proceeds to
repay the borrowings under its term loan and recorded a loss on
early extinguishment of debt of $10 million in 2022. PT-FI
used the remaining net proceeds to finance its downstream
processing facilities.
The senior notes listed below are redeemable in whole or in part,
at the option of PT-FI, at a make-whole redemption price prior to
the dates stated below and beginning on the dates stated below at
100% of principal.
Debt Instrument
Date
4.763% Senior Notes due 2027
March 14, 2027
5.315% Senior Notes due 2032
January 14, 2032
6.200% Senior Notes due 2052
October 14, 2051
Maturities. Maturities of debt instruments based on the principal
amounts outstanding at December 31, 2024, total $41 million in
2025, $5 million in 2026, $1.3 billion in 2027, $1.2 billion in 2028,
$477 million in 2029 and $6.0 billion thereafter.
N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
2024 Annual Report
77
NOTE 7. OTHER LIABILITIES, INCLUDING
EMPLOYEE BENEFITS
The components of other liabilities follow:
December 31,
2024
2023
Leasesa
$ 692
$ 347
Pension, postretirement, postemployment and
other employment benefitsb
689
704
Litigation accruals
163
163
Provision for tax positions
136
174
Social investment programs
111
79
Indemnification of MIND IDa
—
75
Other
96
106
Total other liabilities
$1,887
$ 1,648
a. Refer to Note 5 for current portion and Note 11 for further discussion.
b. Refer to Note 5 for current portion.
Pension Plans. Following is a discussion of FCX’s pension plans.
FMC Plans. FMC has U.S. trusteed, non-contributory pension
plans covering some U.S. employees and some employees of its
international subsidiaries hired before 2007. The applicable FMC
plan design determines the manner in which benefits are
calculated for any particular group of employees. Benefits are
calculated based on final average monthly compensation and years
of service or based on a fixed amount for each year of service.
Non-bargained FMC employees hired after December 31, 2006, are
not eligible to participate in the FMC U.S. pension plan. Effective
September 1, 2020, the FMC Retirement Plan, the largest FMC
plan, was amended such that participants no longer accrue any
additional benefits.
FCX’s funding policy for these plans provides that contributions
to pension trusts shall be at least equal to the minimum funding
requirements of the Employee Retirement Income Security Act of
1974, as amended, for U.S. plans; or, in the case of international
plans, the minimum legal requirements that may be applicable in
the various countries. Additional contributions also may be made
from time to time.
FCX’s primary investment objectives for the FMC plan assets
held in a master trust (Master Trust) are to maintain funds sufficient
to pay all benefit and expense obligations when due, minimize
the volatility of the plan’s funded status to the extent practical,
and to maintain prudent levels of risk consistent with the plan’s
investment policy. The FMC plan assets are invested in a risk-
mitigating portfolio, which is allocated among multiple fixed
income managers. The current target allocation of the portfolio is
long-duration credit (50%); long-duration U.S. government/credit
(20%); core fixed income (22%); long-term U.S. Treasury Separate
Trading of Registered Interest and Principal Securities (7%); and
cash equivalents (1%).
The expected rate of return on plan assets is evaluated at least
annually, taking into consideration asset allocation, historical and
expected future performance on the types of assets held in
the Master Trust, and the current economic environment. Based
on these factors, FCX expects the pension assets will earn an
average of 5.20% per annum beginning January 1, 2025, which is
based on the target asset allocation and long-term capital market
return expectations.
For estimation purposes, FCX assumes the long-term asset mix
for these plans generally will be consistent with the current mix.
Changes in the asset mix could impact the amount of recorded
pension costs, the funded status of the plans and the need for future
cash contributions. A lower-than-expected return on assets also
would decrease plan assets and increase the amount of recorded
pension costs in future years. When calculating the expected return
on plan assets, FCX uses the market value of assets.
Among the assumptions used to estimate the pension benefit
obligation is a discount rate used to calculate the present value of
expected future benefit payments for service to date. The discount
rate assumption for FCX’s U.S. plans is designed to reflect yields
on high-quality, fixed-income investments for a given duration. The
determination of the discount rate for these plans is based on
expected future benefit payments together with the Mercer Yield
Curve—Above Mean. The Mercer Yield Curve—Above Mean is
constructed from the bonds in the Mercer Pension Discount Curve
that have a yield higher than the regression mean yield curve. The
Mercer Yield Curve—Above Mean consists of spot (i.e., zero coupon)
interest rates at one-half-year increments for each of the next
30 years and is developed based on pricing and yield information
for high-quality corporate bonds. Changes in the discount rate
are reflected in FCX’s benefit obligation and, therefore, in future
pension costs.
SERP Plan. FCX has an unfunded Supplemental Executive
Retirement Plan (SERP) for its Chairman of the Board. The SERP
provides for retirement benefits payable in the form of a joint and
survivor annuity, life annuity or an equivalent lump sum. The
participant has elected to receive an equivalent lump sum payment.
The payment will equal a percentage of the participant’s highest
average compensation for any consecutive three-year period during
the five years immediately preceding the completion of 25 years
of credited service. The SERP benefit will be reduced by the value
of all benefits from current and former retirement plans (qualified
and nonqualified) sponsored by FCX, by FM Services Company,
FCX’s wholly owned subsidiary, or by any predecessor employer
(including FCX’s former parent company), except for benefits
produced by accounts funded exclusively by deductions from the
participant’s pay.
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PT-FI Plan. PT-FI has a defined benefit pension plan denominated
in Indonesia rupiah covering substantially all of its Indonesia
national employees. PT-FI funds the plan and invests the assets in
accordance with Indonesia pension guidelines. The pension
obligation was valued at an exchange rate of 16,081 rupiah to one
U.S. dollar on December 31, 2024, and 15,339 rupiah to one
U.S. dollar on December 31, 2023. Indonesia labor laws require
that companies provide a minimum severance to employees
upon employment termination based on the reason for termination
and the employee’s years of service. PT-FI’s pension benefit
obligation includes benefits determined in accordance with this
law. PT-FI’s expected rate of return on plan assets is evaluated at
least annually, taking into consideration its long-range estimated
return for the plan based on the asset mix. Based on these factors,
PT-FI expects its pension assets will earn an average of 7% per
annum beginning January 1, 2025. The discount rate assumption
for PT-FI’s plan is based on the Indonesia Government Security
Yield Curve. Changes in the discount rate are reflected in PT-FI’s
benefit obligation and, therefore, in future pension costs.
Plan Information. FCX uses a measurement date of December 31
for its plans. Information for qualified and non-qualified plans
where the projected benefit obligations and the accumulated
benefit obligations exceed the fair value of plan assets follows:
December 31,
2024
2023
Projected and accumulated benefit obligation
$ 1,734
$ 1,828
Fair value of plan assets
1,379
1,475
Information on the qualified and non-qualified FCX (FMC and
SERP plans) and PT-FI plans as of December 31 follows:
FCX
PT-FI
2024
2023
2024
2023
Change in benefit obligation:
Benefit obligation at
beginning of year
$ 1,880
$ 1,884
$ 221
$ 215
Service cost
16
15
12
11
Interest cost
93
98
14
14
Actuarial (gains) losses
(76)
15
(3)
3
Foreign exchange losses (gains)
—
1
(11)
4
Benefits and administrative
expenses paid
(133)
(133)
(23)
(27)
Other
—
—
3
1
Benefit obligation at end of year
1,780
1,880
213
221
Change in plan assets:
Fair value of plan assets at
beginning of year
1,537
1,483
203
205
Actual return on plan assets
(31)
121
1
11
Employer contributionsa
63
65
14
9
Foreign exchange gains (losses)
—
1
(10)
4
Benefits and administrative
expenses paid
(133)
(133)
(23)
(26)
Fair value of plan assets at
end of year
1,436
1,537
185
203
Funded status
$ (344)
$ (343)
$ (28)
$ (18)
Accumulated benefit obligation
$1,780
$ 1,878
$ 165
$ 182
Weighted-average assumptions used
to determine benefit obligations:
Discount rate
5.67% 5.15%
7.00%
6.75%
Rate of compensation increase
N/A
N/A
4.00%
4.00%
Balance sheet classification of
funded status:
Other assets
$
11
$
9
$ —
$ —
Accounts payable and accrued
liabilities
(3)
(3)
—
—
Other liabilities
(352)
(349)
(28)
(18)
Total
$ (344)
$ (343)
$ (28)
$ (18)
a. Employer contributions for 2025 are currently expected to approximate $64 million for the FCX plans
and $11 million for the PT-FI plan (based on a December 31, 2024, exchange rate of 16,081 Indonesia
rupiah to one U.S. dollar).
The actuarial gain of $76 million in 2024 and loss of $15 million in
2023 for the FCX pension plans primarily resulted from the changes
in the discount rates, which were 5.67% at December 31, 2024,
5.15% at December 31, 2023, and 5.41% at December 31, 2022.
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79
The weighted-average assumptions used to determine net periodic
benefit cost and the components of net periodic benefit cost
for FCX’s pension plans for the years ended December 31 follow:
2024
2023
2022
Weighted-average assumptions:a
Discount rate
5.15%
5.41%
2.85%
Expected return on plan assets
5.75%
5.00%
3.00%
Service cost
$ 16
$ 15
$ 15
Interest cost
93
98
71
Expected return on plan assets
(86)
(72)
(62)
Amortization of net actuarial losses
13
15
15
Net periodic benefit cost
$ 36
$ 56
$ 39
a. The assumptions shown relate only to the FMC Retirement Plan.
The weighted-average assumptions used to determine net periodic
benefit cost and the components of net periodic benefit cost
for PT-FI’s pension plan for the years ended December 31 follow:
2024
2023
2022
Weighted-average assumptions:
Discount rate
6.75%
7.00%
6.50%
Expected return on plan assets
7.00%
7.00%
7.00%
Rate of compensation increase
4.00%
4.00%
4.00%
Service cost
$ 12
$ 11
$ 12
Interest cost
14
14
14
Expected return on plan assets
(13)
(14)
(15)
Amortization of prior service cost
—
2
1
Amortization of net actuarial gains
(1)
(1)
(1)
Special termination benefit
—
1
2
Net periodic benefit cost
$ 12
$ 13
$ 13
The service cost component of net periodic benefit cost is included
in operating income, and the other components are included
in other income, net in the consolidated statements of income.
Included in accumulated other comprehensive loss are the
following amounts that have not been recognized in net periodic
pension cost as of December 31:
2024
2023
After Taxes and
After Taxes and
Before Noncontrolling
Before Noncontrolling
Taxes
Interests
Taxes
Interests
Net actuarial losses
$ 421
$ 289
$ 382
$ 257
Prior service costs
(4)
(4)
(1)
(2)
$ 417
$ 285
$ 381
$ 255
Plan assets are classified within a fair value hierarchy that
prioritizes the inputs to valuation techniques used to measure fair
value. The hierarchy gives the highest priority to unadjusted quoted
prices in active markets for identical assets or liabilities (Level 1),
then to prices derived using significant observable inputs
(Level 2) and the lowest priority to prices derived using significant
unobservable inputs (Level 3).
A summary of the fair value for pension plan assets, including
those measured at net asset value (NAV) as a practical expedient,
associated with the FCX plans follows:
Fair Value at December 31, 2024
Total
NAV
Level 1 Level 2 Level 3
Commingled/collective funds:
Fixed income securities
$ 395
$ 395
$ —
$
—
$ —
Short-term investments
37
37
—
—
—
Fixed income:
Corporate bonds
624
—
—
624
—
Government bonds
238
—
—
238
—
Private equity investments
68
68
—
—
—
Other investments
57
—
1
56
—
Total investments
1,419
$ 500
$ 1
$ 918
$ —
Cash and receivables
20
Payables
(3)
Total pension plan net assets
$ 1,436
Fair Value at December 31, 2023
Total
NAV
Level 1 Level 2 Level 3
Commingled/collective funds:
Fixed income securities
$ 417
$ 417
$ —
$
—
$ —
Short-term investments
24
24
—
—
—
Fixed income:
Corporate bonds
677
—
—
677
—
Government bonds
276
—
—
276
—
Private equity investments
67
67
—
—
—
Other investments
63
—
1
62
—
Total investments
1,524
$ 508
$ 1
$ 1,015
$ —
Cash and receivables
17
Payables
(4)
Total pension plan net assets
$ 1,537
Following is a description of the pension plan asset categories
included in the above tables and the valuation techniques used to
measure fair value. There have been no changes to the techniques
used to measure fair value.
Commingled/collective funds are managed by several fund
managers and are valued at the NAV per unit of the fund. For most
of these funds, the majority of the underlying assets are actively
traded securities. These funds primarily require up to a two-business-
day notice for redemptions.
Fixed income investments include corporate and government
bonds held directly by the Master Trust. Fixed income securities
are valued using a bid-evaluation price or a mid-evaluation price
and, as such, are classified within Level 2 of the fair value hierarchy.
A bid-evaluation price is an estimated price at which a dealer
would pay for a security. A mid-evaluation price is the average of
the estimated price at which a dealer would sell a security and the
estimated price at which a dealer would pay for a security. These
evaluations are based on quoted prices, if available, or models that
use observable inputs.
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Private equity investments are valued at NAV using information
from general partners and have inherent restrictions on
redemptions that may affect the ability to sell the investments at
their NAV in the near term.
A summary of the fair value hierarchy for pension plan assets
associated with the PT-FI plan follows:
Fair Value at December 31, 2024
Total
Level 1 Level 2
Level 3
Government bonds
$ 96
$ 96
$ —
$ —
Common stocks
53
53
—
—
Mutual funds
12
12
—
—
Total investments
161
$ 161
$ —
$ —
Cash and receivablesa
24
Total pension plan net assets
$ 185
Fair Value at December 31, 2023
Total
Level 1 Level 2
Level 3
Government bonds
$ 102
$ 102
$ —
$ —
Common stocks
67
67
—
—
Mutual funds
12
12
—
—
Total investments
181
$ 181
$ —
$ —
Cash and receivablesa
22
Total pension plan net assets
$ 203
a. Cash consists primarily of short-term time deposits.
Following is a description of the valuation techniques used for
pension plan assets measured at fair value associated with the
PT-FI plan. There have been no changes to the techniques used to
measure fair value.
Government bonds, common stocks and mutual funds are
valued at the closing price reported on the active market on which
the individual securities are traded and, as such, are classified
within Level 1 of the fair value hierarchy.
The techniques described above may produce a fair value
calculation that may not be indicative of NRV or reflective of
future fair values. Furthermore, while FCX believes its valuation
techniques are appropriate and consistent with those used
by other market participants, the use of different techniques or
assumptions to determine the fair value of certain financial
instruments could result in a different fair value measurement at
the reporting date.
The expected benefit payments for FCX’s and PT-FI’s pension
plans follow:
FCX
PT-FIa
2025
$ 126
$
14
2026
190
27
2027
129
29
2028
129
31
2029
129
28
2030 through 2034
633
133
a. Based on a December 31, 2024, exchange rate of 16,081 Indonesia rupiah to one U.S. dollar.
Postretirement and Other Benefits. FCX also provides postretirement
medical and life insurance benefits for certain U.S. employees
and, in some cases, employees of certain international subsidiaries.
These postretirement benefits vary among plans, and many plans
require contributions from retirees. The expected cost of providing
such postretirement benefits is accrued during the years employees
render service.
The benefit obligation (funded status) for the postretirement
medical and life insurance benefit plans consisted of a current portion
of $5 million (included in accounts payable and accrued liabilities)
and a long-term portion of $31 million (included in other liabilities) at
December 31, 2024, and a current portion of $5 million and a long-
term portion of $34 million at December 31, 2023.
FCX has a number of postemployment plans covering severance,
long-term disability income, continuation of health and life insurance
coverage for disabled employees or other welfare benefits. The
accumulated postemployment benefit obligation consisted of a current
portion of $7 million (included in accounts payable and accrued
liabilities) and a long-term portion of $43 million (included in other
liabilities) at December 31, 2024, and a current portion of $7 million
and a long-term portion of $46 million at December 31, 2023.
FCX also sponsors a retirement savings plan for most of its U.S.
employees. The plan allows employees to contribute a portion of
their income in accordance with specified guidelines. The savings
plan is a qualified 401(k) plan for all U.S. salaried and non-bargained
hourly employees. Participants exercise control and direct the
investment of their contributions and account balances among
various investment options under the plan. FCX contributes to the
plan and matches a percentage of employee contributions up to
certain limits. For employees whose eligible compensation exceeds
certain levels, FCX provides a nonqualified unfunded defined
contribution plan, which had a liability balance of $69 million at
December 31, 2024, and $62 million at December 31, 2023, all of
which was included in other liabilities.
The costs charged to operations for the employee savings
plan totaled $131 million in 2024, $119 million in 2023 and $101 million
in 2022. FCX has other employee benefit plans, certain of which
are related to FCX’s financial results, which are recognized in
operating costs.
NOTE 8. STOCKHOLDERS’ EQUITY
AND STOCK-BASED COMPENSATION
FCX’s authorized shares of capital stock consists of 3.0 billion shares
of common stock and 50 million shares of preferred stock.
Financial Policy. FCX’s financial policy, which was adopted by
its Board of Directors (Board) in 2021, includes a base dividend and
a performance-based payout framework, whereby up to 50% of
available cash flows generated after planned capital spending and
N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
2024 Annual Report
81
distributions to noncontrolling interests is allocated to shareholder
returns and the balance to debt reduction and investments in value
enhancing growth projects, subject to FCX maintaining its net debt at
a level not to exceed the net debt target of $3.0 billion to $4.0 billion
(excluding net project debt for PT-FI’s new downstream processing
facilities). The Board reviews the structure of the performance-
based payout framework at least annually.
Under its $5.0 billion share repurchase program, FCX has
acquired a total of 49.0 million shares of common stock for a cost
of $1.9 billion ($38.64 average cost per share), including 1.2 million
shares of its common stock for a total cost of $59 million in
2024 and 35.1 million shares of its common stock for a total cost
of $1.3 billion in 2022 (no purchases were made in 2023). As of
February 14, 2025, FCX has $3.1 billion available for repurchases
under the program.
On December 18, 2024, FCX declared quarterly cash dividends
totaling $0.15 per share on its common stock (including a $0.075
per share base dividend and $0.075 per share variable dividend),
which were paid on February 3, 2025, to common stockholders
of record as of January 15, 2025.
The declaration and payment of dividends (base or variable)
and timing and amount of any share repurchases are at the
discretion of FCX’s Board and management, respectively, and are
subject to a number of factors, including not exceeding FCX’s
net debt target, capital availability, FCX’s financial results, cash
requirements, global economic conditions, changes in laws,
contractual restrictions and other factors deemed relevant by
FCX’s Board or management, as applicable. FCX’s share
repurchase program may be modified, increased, suspended or
terminated at any time at the Board’s discretion.
Accumulated Other Comprehensive Loss. A summary of changes in
the balances of each component of accumulated other comprehensive
loss, net of tax, follows:
Defined
Translation
Benefit Plans Adjustment
Total
Balance at January 1, 2022
$ (398)
$ 10
$ (388)
Amounts arising during the perioda,b
61
—
61
Amounts reclassifiedc
7
—
7
Balance at December 31, 2022
(330)
10
(320)
Amounts arising during the perioda,b
41
—
41
Amounts reclassifiedc
5
—
5
Balance at December 31, 2023
(284)
10
(274)
Amounts arising during the perioda,b
(44)
—
(44)
Amounts reclassifiedc
4
—
4
Balance at December 31, 2024
$ (324)
$ 10
$ (314)
a. Includes net actuarial gains (loss), net of noncontrolling interest, totaling $59 million for 2022,
$38 million for 2023 and $(46) million for 2024.
b. Includes tax benefits totaling $2 million for 2022, 2023 and 2024.
c. Includes amortization primarily related to actuarial losses, net of taxes of less than $1 million for
2022, 2023 and 2024.
Stock Award Plans. FCX currently has awards outstanding under
various stock-based compensation plans. The stockholder-
approved 2016 Stock Incentive Plan (the 2016 Plan) provides for the
issuance of stock options, stock appreciation rights, restricted
stock, RSUs, PSUs and other stock-based awards for up to 72 million
common shares. As of December 31, 2024, 15.0 million shares
were available for grant under the 2016 Plan, and no shares were
available under other plans.
Stock-Based Compensation Cost. Compensation cost charged
against earnings for stock-based awards for the years ended
December 31 follows:
2024
2023
2022
Selling, general and administrative expenses
$ 65
$ 64
$ 57
Production and delivery
44
45
38
Total stock-based compensation
109
109
95
Tax benefit and noncontrolling interests’ sharea
(4)
(5)
(4)
Impact on net income
$105
$ 104
$ 91
a. Charges in the U.S. are not expected to generate a future tax benefit.
Stock Options. Stock options granted under the plans generally
expire 10 years after the date of grant and vest in one-third annual
increments beginning one year from the date of grant. The award
agreements provide that participants will receive the following
year’s vesting upon retirement. Therefore, on the date of grant,
FCX accelerates one year of amortization for retirement-eligible
employees. The award agreements also provide for accelerated
vesting upon certain qualifying terminations of employment
within one year following a change of control. FCX has not granted
stock options since 2021.
A summary of stock options outstanding as of December 31,
2024, and activity during the year ended December 31, 2024, follows:
Weighted-
Weighted-
Average
Average
Remaining Aggregate
Number of
Exercise Price
Contractual
Intrinsic
Options
Per Share
Term (years)
Value
Balance at January 1
8,749,933
$ 15.63
Exercised
(3,140,886)
18.13
Balance at December 31
5,609,047
14.22
4.1
$134
Vested and exercisable at
December 31
5,609,047
14.22
4.1
$134
The total intrinsic value of options exercised was $95 million
during 2024, $52 million during 2023 and $148 million during 2022.
The total fair value of options vested was less than $1 million
during 2024, $3 million during 2023 and $23 million during 2022.
Stock-Settled PSUs and RSUs. Since 2014, FCX’s executive
officers received annual grants of PSUs that vest after a three-year
performance period. The total grant date target shares related to
the PSU grants were 0.4 million for each of 2024, 2023 and 2022,
of which the executive officers will earn (i) between 0% and 200%
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N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
of the target shares based on achievement of financial metrics and
(ii) may be increased or decreased up to 25% of the target shares
based on FCX’s total shareholder return compared to the total
shareholder return of a peer group. PSU awards for FCX’s executive
officers who are retirement-eligible are non-forfeitable. As such,
FCX charges the estimated fair value of the non-forfeitable PSU
awards to expense at the time the financial and operational metrics
are established, which is typically grant date. The fair value of PSU
awards for FCX’s executive officers who are not retirement-eligible
are charged to expense over the performance period.
FCX grants RSUs that vest over a period of three years or at the
end of three years to certain employees. Some award agreements
allow for participants to receive the following year’s vesting upon
retirement. Therefore, on the date of grant of these RSU awards,
FCX accelerates one year of amortization for retirement-eligible
employees. FCX also grants RSUs to its directors, which vest on
the first anniversary of the date of grant. The fair value of the RSUs
is amortized over the vesting period or the period until the
director becomes retirement eligible, whichever is shorter. Upon a
director’s retirement, all of their unvested RSUs immediately vest.
For retirement-eligible directors, the fair value of RSUs is recognized
in earnings on the date of grant.
The award agreements provide for accelerated vesting of all
RSUs held by directors if there is a change of control (as defined in
the award agreements) and for accelerated vesting of all RSUs held
by employees if they experience a qualifying termination within one
year following a change of control. Dividends attributable to RSUs
and PSUs accrue and are paid if the awards vest. A summary of
outstanding stock-settled RSUs and PSUs as of December 31, 2024,
and activity during the year ended December 31, 2024, follows:
Weighted-
Average
Grant-Date
Aggregate
Number of
Fair Value
Intrinsic
Awards
Per Award
Value
Balance at January 1
5,699,575
$37.23
Granted
2,262,830
39.46
Vested
(2,224,239)
34.37
Forfeited
(15,082)
41.00
Balance at December 31
5,723,084
39.21
$218
The total fair value of stock-settled RSUs and PSUs granted was
$92 million during 2024, $93 million during 2023 and $83 million
during 2022. The total intrinsic value of stock-settled RSUs and
PSUs vested was $84 million during 2024, $136 million during 2023
and $138 million during 2022. As of December 31, 2024, FCX had
$27 million of total unrecognized compensation cost related to
unvested stock-settled RSUs and PSUs expected to be recognized
over approximately 1.1 years.
Cash-Settled RSUs. Cash-settled RSUs are similar to stock-
settled RSUs but are settled in cash rather than in shares of
common stock. These cash-settled RSUs generally vest over three
years of service. Some award agreements allow for participants to
receive the following year’s vesting upon retirement. Therefore, on
the date of grant of these cash-settled RSU awards, FCX accelerates
one year of amortization for retirement-eligible employees. The
cash-settled RSUs are classified as liability awards, and the fair
value of these awards is remeasured each reporting period until the
vesting dates. The award agreements for cash-settled RSUs
provide for accelerated vesting upon certain qualifying terminations
of employment within one year following a change of control.
Dividends attributable to cash-settled RSUs accrue and are paid if
the awards vest. A summary of outstanding cash-settled RSUs as of
December 31, 2024, and activity during the year ended December 31,
2024, follows:
Weighted-
Average
Grant-Date
Aggregate
Number of
Fair Value
Intrinsic
Awards
Per Award
Value
Balance at January 1
858,741
$ 40.23
Granted
626,050
39.58
Vested
(398,727)
38.19
Forfeited
(22,578)
40.72
Balance at December 31
1,063,486
40.60
$ 40
The total grant-date fair value of cash-settled RSUs was $25 million
during 2024, $24 million during 2023 and $15 million during 2022.
The intrinsic value of cash-settled RSUs vested was $15 million
during 2024, $20 million during 2023 and $26 million during 2022.
The accrued liability associated with cash-settled RSUs consisted
of a current portion of $22 million (included in accounts payable
and accrued liabilities) and a long-term portion of $8 million
(included in other liabilities) at December 31, 2024, and a current
portion of $19 million and a long-term portion of $7 million at
December 31, 2023.
Other Information. The following table includes amounts related
to exercises of stock options and vesting of RSUs and PSUs during
the years ended December 31:
2024
2023
2022
FCX shares tendered or withheld to
pay the exercise price and/or the
statutory withholding taxesa
1,505,675
1,633,519
1,511,072
Cash received from stock option
exercises
$
29
$
47
$
125
Actual tax benefit realized for tax
deductions
$
5
$
4
$
13
Amounts FCX paid for employee taxes
$
35
$
50
$
55
a. Under terms of the related plans, upon exercise of stock options, vesting of stock-settled RSUs and
payout of PSUs, employees may tender or have withheld FCX shares to pay the exercise price and/or
required withholding taxes.
N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
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NOTE 9. INCOME TAXES
Geographic sources of (losses) income before income taxes and
equity in affiliated companies’ net earnings for the years ended
December 31 follow:
2024
2023
2022
U.S.
$ (547)
$
68
$ 840
Foreign
7,454
5,938
5,875
Total
$ 6,907
$ 6,006
$ 6,715
Income taxes are provided on the earnings of FCX’s material
foreign subsidiaries under the assumption that these earnings will
be distributed. FCX has not provided deferred income taxes for
other differences between the book and tax carrying amounts of
its investments in material foreign subsidiaries as FCX considers its
ownership positions to be permanent in duration, and quantification
of the related deferred tax liability is not practicable.
FCX’s provision for income taxes for the years ended
December 31 follows:
2024
2023
2022
Current income taxes:
Federal
$
36
$
5
$
—
State
(1)
(6)
1
Foreign
(2,635)
(2,087)
(2,232)
Total current
(2,600)
(2,088)
(2,231)
Deferred income taxes:
Federal
1
(50)
(149)
State
(1)
(3)
(6)
Foreign
74
(320)
(144)
Total deferred
74
(373)
(299)
Adjustments
—
6
1
Operating loss carryforwards
3
185
262
Provision for income taxes
$ (2,523)
$(2,270)
$ (2,267)
A reconciliation of the U.S. federal statutory tax rate to FCX’s
effective income tax rate for the years ended December 31 follows:
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N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
2024
2023
2022
Amount
%
Amount
%
Amount
%
U.S. federal statutory tax rate
$(1,450)
(21)%
$ (1,261)
(21)%
$ (1,410)
(21)%
Foreign tax credit expiration/ limitationa
(1,053)
(15)
(289)
(5)
(50)
(1)
Valuation allowancea
898
13
119
2
65
—
Withholding and other impacts on foreign earnings
(753)
(11)
(615)
(10)
(673)
(10)
Effect of foreign rates different than the U.S. federal statutory rate
(373)
(6)
(313)
(5)
(314)
(5)
PT-FI historical tax disputesb
185
2
—
—
(8)
—
Percentage depletion
123
2
183
3
189
3
State income taxes
(52)
(1)
3
—
(41)
—
Non-deductible permanent differences
(41)
—
(68)
(1)
(29)
—
Uncertain tax positions
5
—
(28)
(1)
(17)
—
Other items, net
(12)
—
(1)
—
21
—
Provision for income taxes
$(2,523)
(37)%
$ (2,270)
(38)%
$ (2,267)
(34)%
a. Refer to “Valuation Allowances” below.
b. Refer to “Indonesia Tax Matters” below.
FCX paid federal, state and foreign income taxes totaling $2.8 billion
in 2024, $2.1 billion in 2023 and $3.1 billion in 2022. FCX received
refunds of federal, state and foreign income taxes totaling
$248 million in 2024, less than $1 million in 2023 and $46 million
in 2022.
The components of deferred taxes follow:
December 31,
2024
2023
Deferred tax assets:
Net operating losses
$ 1,814
$ 1,761
Accrued expenses
1,657
1,390
Foreign tax credits
184
1,228
Employee benefit plans
76
78
Other
214
215
Deferred tax assets
3,945
4,672
Valuation allowances
(2,984)
(3,894)
Net deferred tax assets
961
778
Deferred tax liabilities:
Property, plant, equipment and
mine development costs
(4,193)
(4,118)
Undistributed earnings
(981)
(911)
Other
(155)
(195)
Total deferred tax liabilities
(5,329)
(5,224)
Net deferred tax liabilities
$ (4,368)
$ (4,446)
Tax Attributes. At December 31, 2024, FCX had (i) U.S. foreign tax
credits of $0.2 billion that will expire between 2025 and 2034,
(ii) U.S. federal net operating losses (NOLs) of $6.0 billion, of which
$0.7 billion can be carried forward indefinitely, with the remainder
primarily expiring between 2036 and 2037, (iii) U.S. state NOLs of
$10.6 billion, of which $3.5 billion can be carried forward indefinitely,
with the remainder primarily expiring between 2025 and 2044,
and (iv) Atlantic Copper NOLs of $0.5 billion that can be carried
forward indefinitely.
Valuation Allowances. On the basis of available information at
December 31, 2024, including positive and negative evidence,
FCX has provided valuation allowances for certain of its deferred
tax assets where it believes it is more-likely-than-not that
some portion or all of such assets will not be realized. Valuation
allowances totaled $3.0 billion at December 31, 2024, and
covered all of FCX’s U.S. foreign tax credits and U.S. federal NOLs,
substantially all of its U.S. state and foreign NOLs, as well as
a portion of its U.S. federal, state and foreign deferred tax assets.
The valuation allowance related to FCX’s U.S. foreign tax credits
totaled $0.2 billion at December 31, 2024. FCX has operations in tax
jurisdictions where statutory income taxes and withholding taxes are
in excess of the U.S. federal income tax rate. Valuation allowances
are recognized on foreign tax credits for which no benefit is expected
to be realized.
The valuation allowance related to FCX’s U.S. federal, state and
foreign NOLs totaled $1.8 billion and other deferred tax assets
totaled $1.0 billion at December 31, 2024. NOLs and deferred tax
assets represent future deductions for which a benefit will only be
realized to the extent these deductions offset future income. FCX
develops an estimate of which future tax deductions will be realized
and recognizes a valuation allowance to the extent these deductions
are not expected to be realized in future periods.
Valuation allowances will continue to be carried on U.S. foreign
tax credits, U.S. federal, state and foreign NOLs and U.S. federal,
state and foreign deferred tax assets, until such time that (i) FCX
generates taxable income against which any of the assets, credits or
NOLs can be used, (ii) forecasts of future income provide sufficient
positive evidence to support reversal of the valuation allowances
or (iii) FCX identifies a prudent and feasible means of securing the
benefit of the assets, credits or NOLs that can be implemented.
The $0.9 billion net decrease in the valuation allowances during
2024 is primarily related to a decrease for expirations of U.S. foreign
tax credits.
U.S. Inflation Reduction Act of 2022. The provisions of the U.S.
Inflation Reduction Act of 2022 (the Act) became applicable to
FCX on January 1, 2023. The Act includes, among other provisions,
a new Corporate Alternative Minimum Tax (CAMT) of 15% on the
adjusted financial statement income (AFSI) of corporations with
average annual AFSI exceeding $1.0 billion over a three-year period.
In September 2024, the Internal Revenue Service (IRS) issued
proposed regulations that provide guidance on the application
of CAMT, which are not final and subject to change. Based on the
proposed guidance released by the IRS, FCX determined that
the provisions of the Act did not impact its financial results for
the years 2024 or 2023.
Pillar Two of the Global Anti-Base Erosion Rules. In 2021, the
Organisation for Economic Co-operation and Development (OECD)
published a framework for Pillar Two of the Global Anti-Base
Erosion Rules, which was designed to coordinate participating
jurisdictions in updating the international tax system to ensure that
large multinational companies pay a minimum level of income
tax. Recommendations from the OECD regarding a global minimum
income tax and other changes are being considered and/or
implemented in jurisdictions where FCX operates. At current metals
market prices, FCX does not expect enactment of the recommended
framework in jurisdictions where it operates to materially impact
its financial results.
Indonesia Tax Matters. During 2024, in conjunction with closure
of PT-FI’s 2021 corporate income tax audit and resolution of
Indonesia disputed tax matters, PT-FI recorded credits to net income
of $215 million, including $199 million to provision for income taxes,
$8 million to production and delivery and $8 million to interest
expense, net.
N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
2024 Annual Report
85
Peru Tax Matters. Cerro Verde’s current mining stability
agreement subjects it to a stable income tax rate of 32% through
the expiration of the agreement on December 31, 2028. The
enacted tax rate on dividend distributions, which is not stabilized
by the agreement, is 5%.
Chile Tax Matters. Under the US-Chilean Tax Treaty, which
became effective in 2024, FCX’s share of income from El Abra is
subject to an income tax rate of 35%.
Effective January 1, 2024, mining royalty taxes in Chile consist of
two main components: (i) profitability-based mining royalty rates
on a sliding scale of 8% to 26% (depending on a defined operational
margin) and (ii) an additional ad valorem royalty tax based on
1% of sales.
Uncertain Tax Positions. Tax positions reflected in the consolidated
financial statements are, based on their technical merits, more-
likely-than-not to be sustained upon examination by taxing
authorities or have otherwise been effectively settled. Such tax
positions reflect the largest amount of benefit, determined on
a cumulative probability basis, that is more-likely-than-not to be
realized upon settlement with the applicable taxing authority with
full knowledge of all relevant information. FCX’s policy associated
with uncertain tax positions is to record accrued interest in
interest expense and accrued penalties in other income, net, rather
than in the provision for income taxes.
A summary of the activities associated with FCX’s reserve for
unrecognized tax benefits for the years ended December 31 follows.
2024
2023
2022
Balance at beginning of year
$ 720
$ 810
$ 808
Additions:
Prior year tax positions
13
27
26
Current year tax positions
10
28
25
Decreases:
Prior year tax positions
(54)
(13)
(12)
Settlements with taxing authorities
(492)
(132)
(37)
Lapse of statute of limitations
(36)
—
—
Balance at end of year
$ 161
$ 720
$ 810
The total amount of accrued interest and penalties associated
with unrecognized tax benefits was $264 million at December 31,
2024, primarily relating to unrecognized tax benefits associated
with royalties and the timing of advance payments, $536 million at
December 31, 2023, and $551 million at December 31, 2022.
Amounts include unpaid items on the consolidated balance sheet
of $26 million at December 31, 2024, $33 million at December 31,
2023, and $36 million at December 31, 2022. Benefits (charges) for
interest and penalties related to unrecognized tax benefits totaled
$8 million in 2024, $(153) million in 2023 and $(7) million in 2022.
The reserve for unrecognized tax benefits of $161 million at
December 31, 2024, included $153 million ($52 million net of
income tax benefits and valuation allowances) that, if recognized,
would reduce FCX’s provision for income taxes. Changes in the
reserve for unrecognized tax benefits associated with current and
prior-year tax positions were primarily related to uncertainties
associated with FCX’s tax treatment of cost recovery methods,
various non-deductible costs, and royalties and other mining
taxes. There continues to be uncertainty related to the timing of
settlements with taxing authorities, but if additional settlements
are agreed upon during the year 2025, FCX could experience a change
in its reserve for unrecognized tax benefits.
FCX or its subsidiaries file income tax returns in the U.S. federal
jurisdiction and various state and foreign jurisdictions. The tax years
for FCX’s major tax jurisdictions that remain subject to examination
are as follows:
Jurisdiction
Years Subject to Examination
Additional Open Years
U.S. Federal
—
2021-2024
Indonesia
2017, 2020
2022-2024
Peru
2020-2021
2017-2019, 2022-2024
Chile
2023
2021-2022, 2024
NOTE 10. CONTINGENCIES
Environmental. FCX’s operations are subject to various environmental
laws and regulations that govern the generation, storage, treatment,
transportation and disposal of hazardous substances; solid waste
disposal; air emissions; wastewater discharges; remediation,
restoration and reclamation of environmental contamination, including
mine closures and reclamation; protection of endangered and
threatened species and designation of critical habitats; and other
related matters. FCX subsidiaries that operate in the U.S. also are
subject to potential liabilities arising under CERCLA and similar
state laws that impose responsibility on current and previous
owners and operators of a facility for the remediation of hazardous
substances released from the facility into the environment,
including damages to natural resources, in some cases irrespective
of when the damage to the environment occurred or who caused
it. Remediation liability also extends to persons who arranged for the
disposal of hazardous substances or transported the hazardous
substances to a disposal site selected by the transporter. These
liabilities are often shared on a joint and several basis, meaning that
each responsible party is fully responsible for the remediation if
some or all of the other historical owners or operators no longer
exist, do not have the financial ability to respond or cannot be found.
As a result, because of FCX’s acquisition of FMC, many of the
subsidiary companies FCX now owns are responsible for a wide variety
of environmental remediation projects throughout the U.S., and
FCX expects to spend substantial sums annually for many years to
address those remediation issues. Certain FCX subsidiaries have
been advised by the U.S. Environmental Protection Agency (EPA),
the Department of the Interior, the Department of Agriculture and
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various state agencies that, under CERCLA or similar state laws
and regulations, they may be liable for costs of responding to
environmental conditions at a number of sites that have been or
are being investigated to determine whether releases of hazardous
substances have occurred and, if so, to develop and implement
remedial actions to address environmental concerns. FCX is also
subject to claims where the release of hazardous substances is
alleged to have caused natural resource damages (NRD) and to
litigation by individuals allegedly exposed to hazardous substances.
As of December 31, 2024, FCX had more than 80 active
remediation projects, including NRD claims, in 20 U.S. states.
The largest obligations discussed below account for approximately
85% of the total balance at December 31, 2024.
A summary of changes in FCX’s estimated environmental
obligations for the years ended December 31 follows:
2024
2023
2022
Balance at beginning of year
$ 1,939
$ 1,740
$ 1,664
Accretion expensea
131
119
110
Net additionsb
82
195
43
Spending
(112)
(115)
(77)
Balance at end of year
2,040
1,939
1,740
Less current portion
(131)
(131)
(125)
Long-term portion
$ 1,909
$ 1,808
$ 1,615
a. Represents accretion of the fair value of environmental obligations assumed in the acquisition of
FMC, which were determined on a discounted cash flow basis.
b. Primarily reflects revisions for changes in the anticipated scope and timing of projects. See further
discussion below.
Estimated future environmental cash payments (on an undiscounted
and de-escalated basis) total $4.4 billion, including $131 million
in 2025, $111 million in 2026, $122 million in 2027, $112 million in
2028, $77 million in 2029 and $3.8 billion thereafter. The amount
and timing of these estimated payments will change as a result
of changes in regulatory requirements, changes in scope and timing
of remediation activities, the settlement of environmental matters
and as actual spending occurs.
At December 31, 2024, FCX’s environmental obligations totaled
$2.0 billion, including $1.9 billion recorded on a discounted basis
for those obligations assumed in the FMC acquisition at fair value.
FCX estimates it is reasonably possible that these obligations
could range between $3.9 billion and $5.1 billion on an undiscounted
and de-escalated basis.
At December 31, 2024, the most significant environmental
obligations were associated with the Pinal Creek site in Arizona;
the Newtown Creek site in New York City; historical smelter sites
principally located in Arizona, Indiana, Kansas, Missouri, New
Jersey, Oklahoma and Pennsylvania; and uranium mining sites in
the western U.S. The recorded environmental obligations for these
sites totaled $1.7 billion at December 31, 2024. FCX may also be
subject to litigation brought by private parties, regulators and
local governmental authorities related to these historical sites.
A discussion of these sites follows.
Pinal Creek. The Pinal Creek site was listed under the Arizona
Department of Environmental Quality’s (ADEQ) Water Quality
Assurance Revolving Fund program in 1989 for contamination in the
shallow alluvial aquifers within the Pinal Creek drainage near
Miami, Arizona. Since that time, environmental remediation has been
performed by members of the Pinal Creek Group, consisting of
Freeport-McMoRan Miami Inc. (Miami), an indirect wholly owned
subsidiary of FCX, and two other companies. Pursuant to a 2010
settlement agreement, Miami agreed to take full responsibility for
future groundwater remediation at the Pinal Creek site, with limited
exceptions. Remediation work consisting of groundwater extraction
and treatment plus source control capping is expected to continue
for many years. During 2023, FCX recorded adjustments to the
Pinal Creek environmental obligation totaling $61 million associated
with a refined engineering scope and cost estimate for work to be
completed within the next several years. FCX’s environmental
liability balance for this site was $517 million at December 31, 2024.
Newtown Creek. From the 1930s until 1964, Phelps Dodge
Refining Corporation (PDRC), an indirect wholly owned subsidiary of
FCX, operated a copper smelter, and from the 1930s until 1984, a
copper refinery, on the banks of Newtown Creek (the creek), which
is a 3.5-mile-long waterway that forms part of the boundary
between Brooklyn and Queens in New York City. Heavy industrial
uses on and around the creek and discharges from the City of
New York’s sewer system over more than a century resulted in
significant environmental contamination of the waterway. In 2010,
EPA designated the creek as a Superfund site and identified
PDRC, four other companies and the City of New York as potentially
responsible parties (PRPs). The following year, PDRC and the four
other companies (the Newtown Creek Group, NCG) and the City of
New York entered an Administrative Order on Consent to perform
a remedial investigation/feasibility study (RI/FS) to assess the nature
and extent of environmental contamination in the creek and identify
remedial options. EPA approved the final RI report in April 2023.
The NCG’s FS work is ongoing. EPA currently expects to approve the
final FS report by April 2028, although this timeframe may be further
extended. EPA is also considering performing the FS evaluation and
remedy selection by creek segment. At the agency’s request, the
NCG prepared a focused feasibility study (FFS) for an early action
remediation project focusing on the East Branch tributary of the
creek. EPA approved the FFS report and, in January 2025, the agency
issued a record of decision selecting an interim remedy for the
East Branch. EPA has identified 30 PRPs for the site, including the
NCG members and New York City, and invited all PRPs to participate
in performing the East Branch remedial design. During 2023,
FCX recorded adjustments to Newtown Creek environmental
N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
2024 Annual Report
87
obligations totaling $64 million based on updated cost estimates
from the draft early action FFS and no further adjustment was
considered necessary based on the issuance of the 2025 record of
decision. FCX’s environmental liability balance for this site was
$452 million at December 31, 2024. The scope and design of the
site remedy (or remedies), final costs of the site investigation and
remediation, and allocation of costs among PRPs are uncertain
and subject to change. Changes to the overall cost of this remedial
obligation and the portion ultimately allocated to PDRC could be
material to FCX.
Historical Smelter Sites. FCX subsidiaries and their predecessors
at various times owned or operated copper, zinc and lead smelters or
refineries in states including Arizona, Indiana, Kansas, Missouri,
New Jersey, Oklahoma and Pennsylvania. For some of these former
processing sites, certain FCX subsidiaries have been advised by EPA
or state agencies that they may be liable for costs of investigating
and, if appropriate, remediating environmental conditions associated
with these former processing facilities. At other sites, certain FCX
subsidiaries have entered into state voluntary remediation programs
to investigate and, if appropriate, remediate on-site and off-site
conditions associated with the facilities. The historical processing
sites are in various stages of assessment and remediation. At some
of these sites, disputes with local residents and elected officials
regarding alleged health effects or the effectiveness of remediation
efforts have resulted in litigation of various types, and similar
litigation at other sites is possible.
From 1920 until 1986, United States Metals Refining Company
(USMR), an indirect wholly owned subsidiary of FCX, owned and
operated a copper smelter and refinery in the Borough of Carteret,
New Jersey. Since the early 1980s, the site has been the subject
of environmental investigation and remediation, under the direction
and supervision of the New Jersey Department of Environmental
Protection (NJDEP). On-site contamination is in the later stages of
remediation. In 2012, after receiving a request from NJDEP, USMR
also began investigating and remediating off-site properties,
which is ongoing. As a result of off-site soil sampling in public and
private areas near the former Carteret smelter, FCX established
an environmental obligation for known and potential off-site
environmental remediation; that work has been essentially completed
at the end of 2024. Assessments of sediments in the adjacent
Arthur Kill and possible remedial actions could result in additional
adjustments to the related environmental obligation in future periods.
In January 2024, the EPA released guidance lowering the
recommended screening levels for investigating lead-contaminated
soils from 400 to 200 parts per million (ppm) or 100 ppm where
there are other sources of lead exposure (such as lead-based paint
that is common in older homes). Screening levels can be used
to establish cleanup levels by some agencies and more stringent
cleanup levels often lead to higher costs through exponential volume
increases due to resulting expanded project footprints. In January
2025, EPA published its final toxicological assessment for inorganic
arsenic, which may be used to calculate cleanup levels at state and
federal remediation sites and may lead to regulatory guidance,
rulemaking and other regulatory activities. FCX is working with state
agencies to understand possible ramifications of this guidance on
its projects. This EPA guidance and future changes to EPA’s lead and
arsenic cleanup levels could result in increases to FCX’s environmental
obligations for ongoing residential property cleanup projects near
former smelter sites.
FCX’s environmental liability balance for historical smelter sites,
including in the Borough of Carteret, New Jersey, was $266 million at
December 31, 2024.
Uranium Mining Sites. During a period between 1940 and the
early 1980s, certain FCX subsidiaries and their predecessors were
involved in uranium exploration and mining in the western U.S.,
primarily on federal and tribal lands in the Four Corners region
of the Southwest. Similar exploration and mining activities by other
companies have also caused environmental impacts warranting
remediation.
In 2017, the Department of Justice, EPA, Navajo Nation, and two
FCX subsidiaries reached an agreement regarding the financial
contribution of the U.S. Government and the FCX subsidiaries and
the scope of the environmental investigation and remediation work
for 94 former uranium mining sites on tribal lands. Under the terms
of the Consent Decree executed in May 2017, and approved by the
U.S. District Court for the District of Arizona, the U.S. contributed
$335 million into a trust fund to cover the government’s initial share
of the costs, and FCX’s subsidiaries are proceeding with the
environmental investigation and remediation work at the 94 sites.
The program is expected to take more than 20 years to complete.
The Consent Decree excluded 23 former uranium mine sites at
which an FCX subsidiary may also be potentially liable, but for which
the U.S. recovered funds as part of a larger bankruptcy settlement
with Tronox. In 2021, EPA informed an FCX subsidiary as well
as two other federal entities that it does not expect to have funds
sufficient to remediate all of the sites covered by the Tronox
bankruptcy settlement. Based on information from EPA, it is currently
considered unlikely that EPA will deplete the Tronox settlement
funds in the near term.
FCX is also conducting site surveys of historical uranium mining
claims associated with FCX subsidiaries on non-tribal federal lands
in the Four Corners region. Under a memorandum of understanding
with the U.S. Bureau of Land Management (BLM), site surveys are
being performed on approximately 15,000 mining claims, ranging from
undisturbed claims to claims with mining features. Based on these
surveys, BLM has issued no further action determinations for certain
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undisturbed claims. A similar agreement is in place with the U.S.
Forest Service for mine features on U.S. Forest Service land. Either
BLM or the U.S. Forest Service may request additional assessment
or remediation activities for other claims with mining features.
FCX will update this obligation when it has a sufficient number of
remedy decisions from the BLM or the U.S. Forest Service to
support a reasonably certain range of outcomes. FCX expects it
will take several years to complete this work.
FCX’s environmental liability balance for the uranium mining
sites was $473 million at December 31, 2024.
AROs. FCX’s ARO estimates are reflected on a third-party cost
basis and are based on FCX’s legal obligation to retire tangible,
long-lived assets. A summary of changes in FCX’s AROs for the years
ended December 31 follows:
2024
2023
2022
Balance at beginning of year
$ 3,001
$ 3,043
$ 2,716
Liabilities incurred
16
18
9
Revisions to cash flow estimates
and settlements, net
635a
54
381a
Accretion expense
154
20b
134
Spending
(122)
(134)
(197)
Balance at end of year
3,684
3,001
3,043
Less current portion
(189)
(185)
(195)
Long-term portion
$ 3,495
$ 2,816
$ 2,848
a. Primarily reflects adjustments for oil and gas properties, Sierrita, PT-FI, Climax and Henderson for
the year 2024, and PT-FI, Morenci and Bagdad for the year 2022. See further discussion below.
b. Includes a $112 million adjustment at PT-FI to correct certain inputs in the historical PT-FI ARO model.
ARO costs may increase or decrease significantly in the future as a
result of changes in regulations, changes in engineering designs
and technology, permit modifications or updates, changes in mine
plans, settlements, inflation or other factors and as reclamation
(concurrent with mining operations or post mining) spending
occurs. ARO activities and expenditures for mining operations
generally are made over an extended period of time commencing
near the end of the mine life; however, certain reclamation
activities may be accelerated if legally required or if determined to
be economically beneficial. For ARO activities and expenditures for
oil and gas operations, the methods used or required to plug and
abandon non-producing oil and gas wellbores; remove platforms,
tanks, production equipment and flow lines; and restore wellsites
could change over time.
Financial Assurance. New Mexico, Arizona, Colorado and other
states, as well as U.S. regulations governing mine operations
on federal land, require financial assurance to be provided for the
estimated costs of mine reclamation and closure, including
groundwater quality protection programs. FCX has satisfied
financial assurance requirements by using a variety of mechanisms,
primarily involving parent company performance guarantees
and financial capability demonstrations, but also trust funds, surety
bonds, letters of credit and other collateral. The applicable
regulations specify financial strength tests that are designed to
confirm a company’s or guarantor’s financial capability to fund
estimated reclamation and closure costs. The amount of financial
assurance FCX subsidiaries are required to provide will vary with
changes in laws, regulations, reclamation and closure requirements,
and cost estimates. At December 31, 2024, FCX’s financial assurance
obligations associated with these U.S. mine closure and
reclamation/restoration costs totaled $2.0 billion, of which
$1.2 billion was in the form of guarantees issued by FCX and FMC.
At December 31, 2024, FCX had trust assets totaling $0.2 billion
(included in other assets), which are legally restricted to be used to
satisfy its financial assurance obligations for its mining properties
in New Mexico. In addition, FCX subsidiaries have financial
assurance obligations for their oil and gas properties associated
with plugging and abandoning wells and facilities totaling $0.7 billion.
Where oil and gas guarantees associated with the Bureau of
Ocean Energy Management do not include a stated cap, the
amounts reflect management’s estimates of the potential exposure.
New Mexico Environmental and Reclamation Programs. FCX’s
New Mexico operations are regulated under the New Mexico Water
Quality Act and regulations adopted by the Water Quality Control
Commission. In connection with discharge permits, the New Mexico
Environment Department (NMED) has required each of these
operations to submit closure plans for NMED’s approval. The closure
plans must include measures to assure meeting applicable
groundwater quality standards following the closure of discharging
facilities and to abate groundwater or surface water contamination
to meet applicable standards. FCX’s New Mexico operations also are
subject to regulation under the 1993 New Mexico Mining Act (the
Mining Act) and the related rules that are administered by the
Mining and Minerals Division of the New Mexico Energy, Minerals
and Natural Resources Department. Under the Mining Act, mines
are required to obtain approval of reclamation plans. The agencies
approved updates to the closure plan and financial assurance
instruments and completed a permit renewal for Chino in 2020 and
Tyrone in 2021. At December 31, 2024, FCX had accrued reclamation
and closure costs of $553 million for its New Mexico operations.
Additional accruals may be required based on the state’s periodic
review of FCX’s updated closure plans and any resulting permit
conditions, and the amount of those accruals could be material.
Arizona Environmental and Reclamation Programs. FCX’s Arizona
operations are subject to regulatory oversight by the ADEQ.
ADEQ has adopted regulations for its aquifer protection permit
(APP) program that require permits for, among other things, certain
facilities, activities and structures used for mining, leaching,
concentrating and smelting, and require compliance with aquifer
water quality standards during operations and closure. An
application for an APP requires a proposed closure strategy that
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will meet applicable groundwater protection requirements following
cessation of operations and an estimate of the implementation
cost, with a more detailed closure plan required at the time operations
cease. A permit applicant must demonstrate its financial ability to
meet the closure costs approved by ADEQ. Closure costs for
facilities covered by APPs are required to be updated every six
years and financial assurance mechanisms are required to be
updated every two years. During 2022, the Morenci and Bagdad
mines increased their AROs by $118 million and $65 million,
respectively, associated with their updated closure strategies and
plans for stockpiles and tailings impoundments that were submitted
to ADEQ for approval. In accordance with FCX’s commitment to
the Global Industry Standard on Tailings Management (the Tailings
Standard), in 2024 Sierrita revised its closure plan and cost
estimates resulting in a $157 million increase in its AROs. FCX will
continue evaluating and, as necessary, updating its closure plans
and closure cost estimates at other Arizona sites, and any such
updates may also result in increased costs that could be significant.
Portions of Arizona mining facilities that operated after January 1,
1986, also are subject to the Arizona Mined Land Reclamation Act
(AMLRA). AMLRA requires reclamation to achieve stability and
safety consistent with post-mining land use objectives specified in
a reclamation plan. Reclamation plans must be approved by the
Arizona State Mine Inspector (ASMI) and must include an estimate
of the cost to perform the reclamation measures specified in the
plan along with financial assurance. In 2023, the ASMI requested
updates to reclamation cost estimates and associated financial
assurance for FCX’s Arizona mine sites, and in 2024, FCX submitted
updated closure scopes of work and associated costs for Miami,
Bagdad and Morenci. FCX will continue to evaluate options
for future reclamation and closure activities at its operating and
non-operating sites, which are likely to result in adjustments to
FCX’s AROs, and those adjustments could be material.
At December 31, 2024, FCX had accrued reclamation and
closure costs of $837 million for its Arizona operations and facilities.
Colorado Reclamation Programs. FCX’s Colorado operations
are regulated by the Colorado Mined Land Reclamation Act
(Reclamation Act) and regulations promulgated thereunder, which
are consistent with the Tailings Standard. Under the Reclamation
Act, mines are required to obtain approval of plans for reclamation
of lands affected by mining operations to be performed during
mining or upon cessation of mining operations. In 2024, both
Henderson and Climax updated cost estimates associated with
reclamation plans under the Reclamation Act and recorded a
total increase of $162 million to their related AROs.
In 2019, Colorado enacted legislation that requires proof of an
end date for water treatment as a condition of permit authorizations
for new mining operations and expansions beyond current
permit authorizations. While this requirement does not apply to
existing operations, it may lead to changes in long-term water
management requirements at Climax and Henderson operations and
their related AROs.
As of December 31, 2024, FCX had accrued reclamation and
closure costs of $351 million for its Colorado operations.
Chile Reclamation and Closure Programs. El Abra is subject to
regulation under the Mine Closure Law administered by the National
Geology and Mining Service. In 2020, El Abra received approval of
its updated closure plan and cost estimates, and in compliance with
the requirement for five-year updates, El Abra expects to submit an
updated plan with closure cost estimates in 2025. At December 31,
2024, FCX had accrued reclamation and closure costs of $105 million
for its El Abra operation.
Peru Reclamation and Closure Programs. Cerro Verde is subject to
regulation under the Mine Closure Law administered by the Peru
Ministry of Energy and Mines (MINEM). Under the closure regulations,
mines must submit a closure plan that includes the reclamation
methods, closure cost estimates, methods of control and verification,
closure and post-closure plans, and financial assurance. In
compliance with the requirement for five-year updates, Cerro Verde
submitted its updated closure plan and cost estimates and received
approval from MINEM in December 2023. At December 31, 2024, FCX
had accrued reclamation and closure costs of $230 million for its
Cerro Verde operation.
Indonesia Reclamation and Closure Programs. The ultimate
amount of reclamation and closure costs to be incurred at PT-FI’s
operations will be determined based on applicable laws and
regulations and PT-FI’s assessment of appropriate remedial activities
under the circumstances, after consultation with governmental
authorities, affected local residents and other affected parties and
cannot currently be projected with precision. Some reclamation
costs will be incurred during mining activities, while the remaining
reclamation costs will be incurred after the end of mining activities,
which are currently estimated to continue through 2041. In 2022,
PT-FI recorded net increases to its ARO totaling $99 million related
to higher estimated costs associated with West Wanagon slope
stabilization remediation and increased reclamation activities and
increased costs. In 2024, PT-FI recorded net increases to its ARO
totaling $122 million primarily for revised reclamation plans for the
Grasberg open pit area and adjustments resulting from a review
and update of the PT-FI ARO model. At December 31, 2024, FCX
had accrued reclamation and closure costs of $1.0 billion for its
PT-FI operations.
Indonesia government regulations issued in 2010 require a
company to provide a mine closure guarantee in the form of a time
deposit placed in a state-owned bank in Indonesia. At December 31,
2024, PT-FI had restricted time deposits totaling $100 million for
mine closure included in other assets.
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Oil and Gas Properties. Substantially all of Freeport McMoRan
Oil & Gas LLC’s (FM O&G’s), FCX’s subsidiary that holds its remaining
oil and gas operations, oil and gas leases require that, upon
termination of economic production, the working interest owners
plug and abandon non-producing wellbores, remove equipment
and facilities from leased acreage, and restore land in accordance
with applicable local, state and federal laws. Following several
sales transactions, FM O&G’s remaining operating areas primarily
include offshore California and the Gulf of Mexico (GOM, also
referred to as Gulf of America). FM O&G recorded increases to its
ARO totaling $163 million in 2024 and $91 million in 2023. As of
December 31, 2024, FM O&G AROs cover approximately 180 wells
and 150 platforms and other structures and it had accrued
reclamation and closure costs of $538 million.
FM O&G’s ARO adjustments for 2024 include $116 million
associated with assumed oil and gas abandonment obligations
resulting from bankruptcies of other companies and were charged
to production and delivery costs. FM O&G, as a predecessor-in-
interest in oil and natural gas leases, is in the chain of title with
unrelated third parties either directly or by virtue of divestiture of
certain oil and natural gas assets previously owned and assigned
by its subsidiaries. Certain counterparties in these divestiture
transactions or third parties in existing leases have filed for
bankruptcy protection or undergone associated reorganizations
and have not performed the required abandonment obligations.
Accordingly, regulations or federal laws require that other working
interest owners, including FM O&G, assume such obligations.
Litigation. In addition to the pending legal proceedings discussed
below and above under “Environmental,” FCX is involved
periodically in ordinary routine litigation incidental to its business,
some of which may result in adverse judgments, settlements, fines,
penalties, injunctions or other relief. SEC regulations require FCX
to disclose environmental proceedings involving a governmental
authority if management reasonably believes that such proceedings
may result in monetary sanctions above a stated threshold.
Pursuant to the SEC regulations, FCX uses a threshold of $1 million
for purposes of determining whether disclosure of any such
environmental proceedings is required. Management does not
believe, based on currently available information, that the outcome
of any current pending legal proceeding will have a material
adverse effect on FCX’s financial condition, although individual or
cumulative outcomes could be material to FCX’s operating results
for a particular period, depending on the nature and magnitude of
the outcome and the operating results for the period.
Asbestos and Talc Claims. Since approximately 1990, various
FCX affiliates have been named as defendants in a large number of
lawsuits alleging personal injury from exposure to asbestos or
talc allegedly contained in industrial products such as electrical
wire and cable, raw materials such as paint and joint compounds,
talc-based lubricants used in rubber manufacturing or from asbestos
contained in buildings and facilities located at properties owned
or operated by affiliates of FCX. Many of these suits involve a large
number of codefendants. Based on litigation results to date and
facts currently known, FCX believes that the amounts of any such
losses, individually or in the aggregate, are not material to its
consolidated financial statements. There can be no assurance that
future developments will not alter this conclusion.
There has been a significant increase in the number of cases
alleging the presence of asbestos contamination in talc-based
cosmetic and personal care products and in cases alleging exposure
to talc products that are not alleged to be contaminated with
asbestos. The primary targets have been the producers of those
products, but defendants in many of these cases also include talc
miners. Cyprus Amax Minerals Company (CAMC), an indirect
wholly owned subsidiary of FCX, and Cyprus Mines Corporation
(Cyprus Mines), a wholly owned subsidiary of CAMC, are among
those targets. Cyprus Mines was engaged in talc mining and
processing from 1964 until 1992 when it exited its talc business by
conveying it to a third party in two related transactions. Those
transactions involved (1) a transfer by Cyprus Mines of the assets of
its talc business to a newly formed subsidiary that assumed all
pre-sale and post-sale talc liabilities, subject to limited reservations,
and (2) a sale of the stock of that subsidiary to the third party.
In 2011, the third party sold that subsidiary to Imerys Talc America
(Imerys), an affiliate of Imerys S.A.
In accordance with the terms of the 1992 transactions and
subsequent agreements, Cyprus Mines has contractual indemnification
rights, subject to limited reservations, against Imerys, which
historically acknowledged those indemnification obligations and
took responsibility for all talc lawsuits against Cyprus Mines
and CAMC tendered to it. However, in February 2019, Imerys filed for
Chapter 11 bankruptcy protection, which triggered an immediate
automatic stay under the federal bankruptcy code prohibiting any
party from continuing or initiating litigation or asserting new
claims against Imerys. As a result, Imerys stopped defending the talc
lawsuits against Cyprus Mines and CAMC.
In January 2021, Imerys filed the form of a global settlement
agreement to be entered into by CAMC, Cyprus Mines, FCX, Imerys
and the other debtors, tort claimants’ committee and future claims
representative in the Imerys bankruptcy. In accordance with the
global settlement, among other things, (1) CAMC agreed to contribute
a total of $130 million in cash to a settlement trust in seven annual
installments, which will be guaranteed by FCX, and (2) CAMC and
Cyprus Mines and their affiliates will contribute to the settlement
trust all rights that they have to the proceeds of certain legacy
insurance policies as well as indemnity rights they have against
Johnson & Johnson. In accordance with the settlement, Cyprus Mines
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commenced its bankruptcy process in February 2021, with all talc
lawsuits against CAMC, Cyprus Mines and FCX being stayed.
The claimants failed to approve the Imerys bankruptcy plan in
2021, which resulted in a lengthy mediation process among the
interested parties.
Mediation resulted in CAMC agreeing to contribute an additional
$65 million over seven years to the claimant trust for a total
contribution of $195 million. The claimants in both the Imerys and
Cyprus Mines bankruptcy cases approved the global settlement
in January 2025, which now remains subject to bankruptcy court
approvals in both cases. There can be no assurance that the
global settlement will be approved and successfully implemented.
At December 31, 2024, FCX had a litigation reserve of $195 million
associated with the proposed settlement.
Tax Matters. FCX’s operations are in multiple jurisdictions where
uncertainties arise in the application of complex tax regulations.
Some of these tax regimes are defined by contractual agreements
with the local government, while others are defined by general
tax laws and regulations. FCX and its subsidiaries are subject to
reviews of its income tax filings and other tax payments, and
disputes can arise with the taxing authorities over the interpretation
of its contracts or laws. The final taxes paid may be dependent
upon many factors, including negotiations with taxing authorities.
In certain jurisdictions, FCX pays a portion of the disputed amount
before formally appealing an assessment. Such payment is
recorded as a receivable if FCX believes the amount is collectible.
Peru Tax Matters. Cerro Verde has received assessments from
the National Superintendency of Customs and Administration
(SUNAT) for additional taxes, penalties and interest related to
various audit exceptions for income and other taxes. Cerro Verde
has filed or will file objections to the assessments because it
believes it has properly determined and paid its taxes. A summary
of these assessments follows:
Tax
Penalties and
Tax Year
Assessment
Interest
Total
2003 to 2008
$ 32
$ 112
$ 144
2009
9
30
39
2010
8
69
77
2011 and 2012
5
36
41
2013
8
26
34
2014 to 2022
88
40
128
$ 150
$ 313
$ 463
As of December 31, 2024, Cerro Verde had paid $454 million of
disputed tax assessments. A reserve has been applied against
these payments totaling $179 million, resulting in a net receivable
of $275 million (included in other assets), which Cerro Verde
believes is collectible.
Cerro Verde’s income tax assessments, penalties and interest
included in the table above totaled $397 million at December 31, 2024,
of which $245 million has not been charged to expense.
Indonesia Tax Matters. PT-FI has received assessments from
the Indonesia tax authorities for additional taxes and interest related
to various audit exceptions for income and other taxes. PT-FI
has filed objections to the assessments because it believes it has
properly determined and paid its taxes. A summary of these
assessments follows:
Tax
Penalties and
Tax Year
Assessment
Interest
Total
2005
$ 61
$ 29
$ 90
2007
45
21
66
2013 and 2017
7
4
11
$ 113
$ 54
$ 167
As of December 31, 2024, PT-FI has paid $10 million on these
disputed tax assessments (included in other assets), which PT-FI
believes is collectible. The disputed tax assessments above
include pending cases at the Indonesia Supreme Court related to
withholding taxes for employees and other service providers for
the years 2005 and 2007, which total $41 million (included in
accounts payable and accrued liabilities) as of December 31, 2024.
PT-FI’s income tax assessments, penalties and interest included
in the table above totaled $121 million at December 31, 2024, of which
$117 million has not been charged to expense.
Indonesia Regulatory Matters.
Export Licenses. Current regulations in Indonesia prohibit exports
of copper concentrate as of January 1, 2025. Pursuant to the terms
of its special mining business license (IUPK) regarding force majeure
events, PT-FI has requested approval from the Indonesia government
to permit the export of copper concentrate in 2025 until the
required repairs to its new smelter following the October 2024 fire
incident and full ramp-up are complete.
Long-Term Mining Rights. Pursuant to regulations issued during
2024, PT-FI is eligible to apply for an extension of its mining rights
beyond 2041, provided certain conditions are met, including
ownership of integrated downstream facilities that have entered the
operational stage; domestic ownership of at least 51% and
agreement with a state-owned enterprise for an additional 10%
ownership; and commitments for additional exploration and
increases in refining capacity, each as approved by the Ministry of
Energy and Mineral Resources (MEMR). Application for extension
may be submitted at any time up to one year prior to the expiration
of PT-FI’s IUPK.
Administrative Fines. In June 2021, the MEMR, issued a ministerial
decree for the calculation of an administrative fine for lack of smelter
development in light of the COVID-19 pandemic, and in 2021, PT-FI
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recorded charges totaling $16 million for a potential settlement of
the administrative fine. In January 2022, the Indonesia government
submitted a new estimate of the administrative fine totaling
$57 million, and in March 2022, PT-FI paid the administrative fine
and recorded an additional charge of $41 million.
In May 2023, the MEMR issued a new decree prescribing a
revised formula for administrative fines for delays in construction of
smelting and refining facilities, taking into account allowances for
certain delays associated with the COVID-19 pandemic as verified
by a third-party. In mid-July 2023, PT-FI submitted its third-party
verified calculation, which resulted in an accrual for a potential
administrative fine of $55 million based on the formula prescribed
by the decree related to the period from August 2020 through
January 2022. In December 2024, the Indonesia government
assessed PT-FI a $59 million administrative fine for delays in
development of the new downstream processing facilities related
to the period from August 2020 through January 2022. As a result,
PT-FI increased its accrual by $4 million at December 31, 2024.
Smelter Assurance. The May 2023 decree issued by MEMR also
required assurance in the form of an escrow account, which can
be withdrawn if smelter development progress is at least 90% on
June 10, 2024. During 2023, PT-FI deposited $10 million in a joint
account with the Indonesia government while it continued to
discuss the applicability of the May 2023 decree. At December 31,
2024, development of PT-FI’s new downstream processing facilities
was complete; as such, PT-FI does not believe additional deposits
are necessary. Refer to Note 12 for discussion of PT-FI’s assurance
bonds to support its commitment for smelter development
in Indonesia.
Export Proceeds. In accordance with a regulation issued by the
Indonesia government in 2023, 30% of PT-FI’s gross export
proceeds are being temporarily deposited into Indonesia banks for
a period of 90 days before withdrawal. At December 31, 2024, FCX
had $0.7 billion in current restricted cash and cash equivalents
deposited in Indonesia banks in accordance with this regulation.
The Indonesia government is considering changes to this
regulation, which could increase the amount and length of the
requirement, but also allow withdrawals from the balances to fund
business requirements. The details of the modifications have not
been finalized.
Letters of Credit, Bank Guarantees and Surety Bonds. Letters of
credit and bank guarantees totaled $638 million at December 31,
2024, primarily associated with reclamation and AROs, and copper
concentrate shipments from PT-FI to Atlantic Copper as required
by Indonesia regulations. In addition, FCX had surety bonds
totaling $504 million at December 31, 2024, primarily associated
with environmental obligations and AROs.
Insurance. FCX purchases a variety of insurance products to
mitigate potential losses, which typically have specified deductible
amounts or self-insured retentions and policy limits. FCX generally
is self-insured for U.S. workers’ compensation but purchases
excess insurance up to statutory limits. An actuarial analysis is
performed twice a year on the various casualty insurance programs
covering FCX’s U.S.-based mining operations, including workers’
compensation, to estimate expected losses. At December 31, 2024,
FCX’s liability for expected losses under these insurance programs
totaled $54 million, which consisted of a current portion of $14 million
(included in accounts payable and accrued liabilities) and
a long-term portion of $40 million (included in other liabilities). In
addition, FCX has receivables of $18 million (a current portion
of $9 million included in other accounts receivable and a long-term
portion of $9 million included in other assets) for expected claims
associated with these losses to be filed with insurance carriers.
NOTE 11. COMMITMENTS AND GUARANTEES
Leases. The components of FCX’s leases presented in the
consolidated balance sheets as of December 31 follow:
2024
2023
Lease right-of-use assets (included in property, plant,
equipment and mine development costs, net)
$ 853
$ 448
Short-term lease liabilities (included in accounts
payable and accrued liabilities)
$ 98
$ 84
Long-term lease liabilities (included in other liabilities)
692
347
Total lease liabilitiesa
$790
$ 431
a. Includes finance leases associated with PT-FI’s new downstream processing facilities, including
for an oxygen plant ($217 million at December 31, 2024), shallow draft vessels ($119 million at
December 31, 2024), land ($95 million at December 31, 2024, and $130 million at December 31, 2023)
and wharf ($90 million at December 31, 2024, and $93 million at December 31, 2023).
Operating lease costs, primarily included in production and
delivery expense in the consolidated statements of income, for the
years ended December 31 follow:
2024
2023
2022
Operating leases
$ 44
$ 48
$ 46
Variable and short-term leases
146a
126a
84
Total operating lease costs
$190
$ 174
$ 130
a. Includes $50 million in 2024 and $30 million in 2023 related to a variable lease component of PT-FI’s
tolling arrangement with PT Smelting. Refer to Note 2 for additional discussion of PT-FI’s commercial
arrangement with PT Smelting.
Total finance lease costs, including both depreciation and interest,
were $24 million in 2024 and $6 million in 2023 and 2022.
FCX acquired right-of-use assets through lease arrangements of
$482 million in 2024, $167 million in 2023 and $76 million in 2022.
FCX payments included in operating cash flows for its lease
liabilities totaled $61 million in 2024 and 2023 and $41 million in 2022.
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FCX payments included in financing cash flows for its lease
liabilities totaled $41 million in 2024, $3 million in 2023 and $7 million
in 2022. As of December 31, 2024, the weighted-average discount
rate used to determine the lease liabilities was 4.9% (4.7% as
of December 31, 2023) and the weighted-average remaining lease
term was 15.0 years (13.1 years as of December 31, 2023).
The future minimum payments for leases presented in the
consolidated balance sheet at December 31, 2024, follow:
2025
$ 131
2026
96
2027
81
2028
67
2029
113
Thereafter
612
Total payments
1,100
Less amount representing interest
(310)
Present value of net minimum lease payments
790
Less current portion
(98)
Long-term portion
$ 692
Contractual Obligations. At December 31, 2024, based on applicable
prices on that date, FCX has unconditional purchase obligations
(including take-or-pay contracts with terms less than one year) of
$3.7 billion, primarily comprising the procurement of copper
concentrate ($3.1 billion), electricity ($0.2 billion) and transportation
services ($0.2 billion). Some of FCX’s unconditional purchase
obligations are settled based on the prevailing market rate for the
service or commodity purchased. In some cases, the amount
of the actual obligation may change over time because of market
conditions. Obligations for copper concentrate provide for
deliveries of specified volumes to Atlantic Copper at market-based
prices. Transportation obligations are primarily associated with
contracted ocean freight agreements for our South America and
Indonesia operations. Electricity obligations are primarily for
long-term power purchase agreements in North America and
contractual minimum demand at the South America mines.
FCX’s unconditional purchase obligations total $1.8 billion in
2025, $1.1 billion in 2026, $0.4 billion in 2027, $0.2 billion in 2028,
$0.1 billion in 2029 and $0.1 billion thereafter. During the three-year
period ended December 31, 2024, FCX fulfilled its minimum
contractual purchase obligations.
IUPK—Indonesia. In December 2018, FCX completed the 2018
Transaction with the Indonesia government regarding PT-FI’s
long-term mining rights and share ownership. Concurrent with the
closing of the 2018 Transaction, the Indonesia government granted
PT-FI an IUPK to replace its former contract of work. Under the
terms of the IUPK, PT-FI was granted an extension of mining rights
through 2031, with rights to extend mining rights through 2041,
subject to PT-FI completing the development of additional smelting
and refining capacity in Indonesia and fulfilling its defined fiscal
obligations to the Indonesia government. The IUPK, and related
documentation, contains legal and fiscal terms and is legally
enforceable through 2041, assuming the additional extension is
received. In addition, FCX, as a foreign investor, has rights to resolve
investment disputes with the Indonesia government through
international arbitration.
The key fiscal terms set forth in the IUPK include a 25% corporate
income tax rate, a 10% profits tax on net income, and royalty rates
of 4% for copper, 3.75% for gold and 3.25% for silver. PT-FI’s
royalties charged against revenues totaled $433 million in 2024,
$338 million in 2023 and $357 million in 2022.
Dividend distributions from PT-FI to FCX totaled $1.5 billion in
2024, $0.4 billion in 2023 and $2.5 billion in 2022, and are subject to
a 10% withholding tax.
Export Duties. The IUPK required PT-FI to pay export duties of 5%,
declining to 2.5% when smelter development progress exceeded
30% and eliminated when development progress for additional
smelting and refining capacity in Indonesia exceeded 50%. In
December 2022, PT-FI received approval, based on construction
progress achieved, for a reduction in export duties from 5% to 2.5%,
which was effective immediately. In March 2023, the Indonesia
government further verified that construction progress of the new
smelter exceeded 50% and PT-FI’s export duties were eliminated
effective March 29, 2023.
In July 2023, the Ministry of Finance issued a revised regulation on
duties for various exported products, including copper concentrates.
Under the revised regulation PT-FI was assessed export duties for
copper concentrates at 7.5% in the second half of 2023 (totaling
$307 million). For 2024, the revised regulation assessed export
duties for copper concentrates at 10% for companies with smelter
progress of 70% to 90% and at 7.5% for companies with smelter
progress exceeding 90%. As of December 31, 2023, construction
progress of PT-FI’s smelter projects exceeded 90%; however, PT-FI
was subject to the 10% export duty during 2024 until it received a
revised concentrate export license. In July 2024, PT-FI was granted
copper concentrate and anode slimes export licenses, which were
valid through December 2024, subjecting PT-FI to a 7.5% export
duty. PT-FI’s export duties totaled $457 million in 2024, $324 million
in 2023 and $307 million in 2022.
Indemnification. The PT-FI divestment agreement, discussed in
Note 2, provides that FCX will indemnify MIND ID and PTI from any
losses (reduced by receipts) arising from any tax disputes of PT-FI
disclosed to MIND ID in a Jakarta, Indonesia, tax court letter limited
to PTI’s respective percentage share at the time the loss is finally
incurred. Any net obligations arising from any tax settlement would
be paid on December 21, 2025. FCX had accrued $49 million as of
December 31, 2024, (included in accounts payable in the
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consolidated balance sheets) and $75 million as of December 31,
2023, (included in other long-term liabilities in the consolidated
balance sheets) related to this indemnification.
Cobalt Business. In September 2021, FCX’s 56%-owned subsidiary,
Koboltti Chemicals Holdings Limited (KCHL), completed the sale
of its remaining cobalt business based in Kokkola, Finland (Freeport
Cobalt) to Jervois Global Limited (Jervois) for $208 million (before
post-closing adjustments), consisting of cash consideration of
$173 million and 7% of Jervois common stock (valued at $35 million
at the time of closing). In 2022, KCHL sold these shares for
$60 million. In addition, KCHL has the right to receive contingent
consideration through 2026 of up to $40 million based on the
future performance of Freeport Cobalt. Any gain related to the
contingent consideration will be recognized when received.
Following this transaction, FCX no longer has cobalt operations.
Community Development Programs. FCX has adopted policies
that govern its working and engagement relationships with the
communities where it operates. These policies are designed to
guide FCX’s practices and programs in a manner that respects and
promotes basic human rights and the culture of the local people
impacted by FCX’s operations. FCX continues to make significant
expenditures on community development, education, health,
training and cultural programs.
PT-FI provides funding and technical assistance to support
various community development and empowerment programs in
areas such as health, education, economic development and
local infrastructure. In 1996, PT-FI established a social investment
fund with the aim of contributing to social and economic
development in the Mimika Regency. In 2019, a new foundation,
the Amungme and Kamoro Community Empowerment Foundation
(Yayasan Pemberdayaan Masyarakat Amungme dan Kamoro,
or YPMAK) was established, and in 2020, PT-FI appointed YPMAK
to assist in distributing a significant portion of PT-FI’s funding
to support the development and empowerment of the local
Indigenous Papuan people. YPMAK is governed by a Board of
Governors consisting of seven representatives of Indigenous
Kamoro-Amungme, PT-FI and Mind ID.
In addition, since 2001, PT-FI has voluntarily established and
contributed to land rights trust funds administered by Amungme and
Kamoro representatives that focus on socioeconomic initiatives,
human rights and environmental issues.
PT-FI is committed to the continued funding of YPMAK programs
and the land rights trust funds, as well as for other local-community
development initiatives through the end of PT-FI’s IUPK in support
of public health, education, local economic development and
empowerment. PT-FI recorded charges to production and delivery
costs totaling $141 million in 2024 and $123 million in both 2023
and 2022 for social and economic development programs.
Guarantees. FCX provides certain financial guarantees (including
indirect guarantees of the indebtedness of others) and indemnities.
Prior to its acquisition by FCX, FMC and its subsidiaries have,
as part of merger, acquisition, divestiture and other transactions,
from time to time, indemnified certain sellers, buyers or other parties
related to the transaction from and against certain liabilities
associated with conditions in existence (or claims associated with
actions taken) prior to the closing date of the transaction. As part of
these transactions, FMC indemnified the counterparty from and
against certain excluded or retained liabilities existing at the time
of sale that would otherwise have been transferred to the party
at closing. These indemnity provisions generally now require FCX to
indemnify the party against certain liabilities that may arise in the
future from the pre-closing activities of FMC for assets sold or
purchased. The indemnity classifications include environmental, tax
and certain operating liabilities, claims or litigation existing at
closing and various excluded liabilities or obligations. Most of these
indemnity obligations arise from transactions that closed many
years ago, and given the nature of these indemnity obligations, it is
not possible to estimate the maximum potential exposure. Except as
described in the following sentence, FCX does not consider any of
such obligations as having a probable likelihood of payment that is
reasonably estimable, and accordingly, has not recorded any
obligations associated with these indemnities. With respect to FCX’s
environmental indemnity obligations, any expected costs from these
guarantees are accrued when potential environmental obligations
are considered by management to be probable and the costs can be
reasonably estimated.
NOTE 12. FINANCIAL INSTRUMENTS
FCX does not purchase, hold or sell derivative financial instruments
unless there is an existing asset or obligation, or it anticipates a
future activity that is likely to occur and will result in exposure to
market risks, which FCX intends to offset or mitigate. FCX does not
enter into any derivative financial instruments for speculative
purposes, but has entered into derivative financial instruments in
limited instances to achieve specific objectives. These objectives
principally relate to managing risks associated with commodity price
changes, foreign currency exchange rates and interest rates.
Commodity Contracts. From time to time, FCX has entered into
derivative contracts to hedge the market risk associated with
fluctuations in the prices of commodities it purchases and sells.
Derivative financial instruments used by FCX to manage its risks do
not contain credit risk-related contingent provisions.
A discussion of FCX’s derivative contracts and programs follows.
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Derivatives Designated as Hedging Instruments—
Fair Value Hedges
Copper Futures and Swap Contracts. Some of FCX’s U.S. copper
rod and cathode customers request a fixed market price instead of
the COMEX average copper price in the month of shipment. FCX
hedges this price exposure in a manner that allows it to receive the
COMEX average price in the month of shipment while the
customers pay the fixed price they requested. FCX accomplishes
this by entering into copper futures or swap contracts. Hedging
gains or losses from these copper futures and swap contracts are
recorded in revenues. FCX did not have any significant gains or
losses resulting from hedge ineffectiveness during the three years
ended December 31, 2024. At December 31, 2024, FCX held
copper futures and swap contracts that qualified for hedge
accounting for 109 million pounds at an average contract price of
$4.31 per pound, with maturities through November 2026.
Summary of (Losses) Gains. A summary of realized and unrealized
(losses) gains recognized in revenues for derivative financial
instruments related to commodity contracts that are designated
and qualify as fair value hedge transactions, including on the
related hedged item for the years ended December 31 follows:
2024
2023
2022
Copper futures and swap contracts:
Unrealized (losses) gains:
Derivative financial instruments
$(32)
$ 3
$ (11)
Hedged item—firm sales commitments
32
(3)
11
Realized gains (losses):
Matured derivative financial instruments
29
(4)
(63)
Derivatives Not Designated as Hedging Instruments
Embedded Derivatives. Certain FCX sales contracts provide for
provisional pricing primarily based on the LME copper price or the
COMEX copper price and the London gold price at the time of
shipment as specified in the contract. FCX receives market prices
based on prices in the specified future month, which results in
price fluctuations recorded in revenues until the date of settlement.
FCX records revenues and invoices customers at the time of
shipment based on then-current LME or COMEX copper prices
and the London gold price as specified in the contracts, which
results in an embedded derivative (i.e., a pricing mechanism that is
finalized after the time of delivery) that is required to be bifurcated
from the host contract. The host contract is the sale of the metals
contained in the concentrate, cathode or anode slimes at the
then-current LME copper, COMEX copper or London gold prices.
FCX applies the normal purchases and normal sales scope exception
in accordance with derivatives and hedge accounting guidance to
the host contract in its concentrate, cathode and anode slime sales
agreements since these contracts do not allow for net settlement
and always result in physical delivery. The embedded derivative does
not qualify for hedge accounting and is adjusted to fair value
through earnings each period, using the period-end LME or COMEX
copper forward prices and the adjusted London gold price, until
the date of final pricing. Similarly, FCX purchases copper under
contracts that provide for provisional pricing. Mark-to-market price
fluctuations from these embedded derivatives are recorded
through the settlement date and are reflected in revenues for sales
contracts and in inventory for purchase contracts.
A summary of FCX’s embedded derivatives at December 31,
2024, follows:
Average Price
Open
Per Unit
Maturities
Positions Contract Market
Through
Embedded derivatives in provisional
sales contracts:
Copper (millions of pounds)
282
$ 4.16
$ 3.96
May 2025
Gold (thousands of ounces)
125
2,646
2,625
February 2025
Embedded derivatives in provisional
purchase contracts:
Copper (millions of pounds)
74
4.09
3.96
March 2025
Copper Forward Contracts. Atlantic Copper enters into copper
forward contracts designed to hedge its copper price risk
whenever its physical purchases and sales pricing periods do not
match. These economic hedge transactions are intended to hedge
against changes in copper prices, with the mark-to-market
hedging gains or losses recorded in production and delivery costs.
At December 31, 2024, Atlantic Copper held net copper forward
sales contracts for 85 million pounds at an average contract price
of $4.06 per pound, with maturities through February 2025.
Summary of Gains (Losses). A summary of the realized and
unrealized gains (losses) recognized in operating income for
commodity contracts that do not qualify as hedge transactions,
including embedded derivatives, for the years ended December 31
follows:
2024
2023
2022
Embedded derivatives in provisional
sales contracts:a
Copper
$ 117
$ 97
$ (479)
Gold and other metals
169
55
(12)
Copper forward contractsb
1
(6)
37
a. Amounts recorded in revenues.
b. Amounts recorded in cost of sales as production and delivery costs.
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Unsettled Derivative Financial Instruments
A summary of the fair values of unsettled commodity derivative
financial instruments follows:
December 31,
2024
2023
Commodity Derivative Assets:
Derivatives designated as hedging instruments:
Copper futures and swap contracts
$ —
$ 4
Derivatives not designated as hedging instruments:
Embedded derivatives in provisional sales/
purchase contracts
10
76
Copper forward contracts
10
—
Total derivative assets
$ 20
$ 80
Commodity Derivative Liabilities:
Derivatives designated as hedging instruments:
Copper futures and swap contracts
$ 28
$ —
Derivatives not designated as hedging instruments:
Embedded derivatives in provisional sales/
purchase contracts
60
23
Copper forward contracts
1
1
Total derivative liabilities
$ 89
$ 24
FCX’s commodity contracts have netting arrangements with
counterparties with which the right of offset exists, and it is FCX’s
policy to generally offset balances by contract on its balance
sheet. FCX’s embedded derivatives on provisional sales/purchase
contracts are netted with the corresponding outstanding receivable/
payable balances.
A summary of these net unsettled commodity contracts in
the balance sheet follows (there were no offsetting amounts at
December 31, 2024 and 2023):
Assets
Liabilities
December 31,
2024
2023
2024
2023
Amounts presented in balance sheet:
Commodity contracts:
Embedded derivatives in provisional
sales/purchase contracts
$10
$ 76
$ 60
$ 23
Copper derivatives
10
4
29
1
$ 20
$ 80
$ 89
$ 24
Balance sheet classification:
Trade accounts receivable
$ —
$ 76
$ 53
$ 2
Other current assets
10
4
—
—
Accounts payable and accrued liabilities
10
—
35
22
Other liabilities
—
—
1
—
$ 20
$ 80
$ 89
$ 24
Credit Risk. FCX is exposed to credit loss when financial institutions
with which it has entered into derivative transactions (commodity,
foreign exchange and interest rate swaps) are unable to pay.
To minimize the risk of such losses, FCX uses counterparties that
meet certain credit requirements and periodically reviews the
creditworthiness of these counterparties. As of December 31, 2024,
the maximum amount of credit exposure associated with derivative
transactions was $20 million.
Other Financial Instruments. Other financial instruments include
cash, cash equivalents, restricted cash and cash equivalents,
accounts receivable, investment securities, legally restricted trust
assets, accounts payable and accrued liabilities, accrued income
taxes, dividends payable and debt. The carrying value for these
financial instruments classified as current assets or liabilities
approximates fair value because of their short-term nature and
generally negligible credit losses (refer to Note 13 for the fair values
of investment securities, legally restricted funds and debt).
Cash, Cash Equivalents and Restricted Cash and Cash Equivalents.
The following table provides a reconciliation of total cash, cash
equivalents and restricted cash and cash equivalents presented in
the consolidated statements of cash flows:
December 31,
2024
2023
Balance sheet components:
Cash and cash equivalentsa
$ 3,923
$ 4,758
Restricted cash and cash equivalents, currentb
888
1,208
Restricted cash and cash equivalents,
long-term—included in other assets
100
97
Total cash, cash equivalents and restricted cash
and cash equivalents presented in the
consolidated statements of cash flows
$ 4,911
$ 6,063
a. Includes (i) time deposits of $0.1 billion at December 31, 2024, and $0.3 billion at December 31, 2023,
and (ii) cash designated for PT-FI’s new downstream processing facilities totaling $0.2 billion at
December 31, 2023.
b. Includes (i) $0.7 billion at December 31, 2024, and $1.1 billion at December 31, 2023, associated with
30% of PT-FI’s export proceeds required to be temporarily deposited in Indonesia banks for 90 days
in accordance with a regulation issued by the Indonesia government and (ii) $0.1 billion at
December 31, 2024 and 2023, in assurance bonds to support PT-FI’s commitment for its new
downstream processing facilities.
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NOTE 13. FAIR VALUE MEASUREMENT
Fair value accounting guidance includes a hierarchy that prioritizes
the inputs to valuation techniques used to measure fair value.
The hierarchy gives the highest priority to unadjusted quoted prices
in active markets for identical assets or liabilities (Level 1) and
the lowest priority to unobservable inputs (Level 3). FCX did not
have any significant transfers in or out of Level 3 for 2024.
FCX’s financial instruments are recorded on the consolidated
balance sheets at fair value except for contingent consideration
associated with the sale of the Deepwater GOM oil and gas properties
(which was recorded under the loss recovery approach) and debt.
A summary of the carrying amount and fair value of FCX’s financial
instruments (including those measured at NAV as a practical
expedient), other than cash and cash equivalents, restricted cash
and cash equivalents, accounts receivable, accounts payable
and accrued liabilities, accrued income taxes and dividends payable
(refer to Note 12), follows:
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At December 31, 2024
Carrying
Fair Value
Amount
Total
NAV
Level 1
Level 2
Level 3
Assets
Investment securities:a,b
U.S. core fixed income fund
$
27
$
27
$ 27
$ —
$
—
$ —
Equity securities
9
9
—
9
—
—
Total
36
36
27
9
—
—
Legally restricted funds:a
U.S. core fixed income fund
66
66
66
—
—
—
Government mortgage-backed securities
54
54
—
—
54
—
Government bonds and notes
34
34
—
—
34
—
Corporate bonds
31
31
—
—
31
—
Money market funds
19
19
—
19
—
—
Asset-backed securities
12
12
—
—
12
—
Collateralized mortgage-backed securities
1
1
—
—
1
—
Total
217
217
66
19
132
—
Derivatives:c
Embedded derivatives in provisional sales/purchase contracts
in a gross asset position
10
10
—
—
10
—
Copper forward contracts
10
10
—
4
6
—
Total
20
20
—
4
16
—
Contingent consideration for the sale of the
Deepwater GOM oil and gas propertiesa
3
3
—
—
—
3
Liabilities
Derivatives:c
Embedded derivatives in provisional sales/purchase contracts
in a gross liability position
60
60
—
—
60
—
Copper futures and swap contracts
28
28
—
17
11
—
Copper forward contracts
1
1
—
1
—
—
Total
89
89
—
18
71
—
Long-term debt, including current portiond
8,948
8,807
—
—
8,807
—
At December 31, 2023
Carrying
Fair Value
Amount
Total
NAV
Level 1
Level 2
Level 3
Assets
Investment securities:a,b
U.S. core fixed income fund
$
27
$
27
$ 27
$ —
$
—
$ —
Equity securities
6
6
—
6
—
—
Total
33
33
27
6
—
—
Legally restricted funds:a
U.S. core fixed income fund
65
65
65
—
—
—
Government mortgage-backed securities
51
51
—
—
51
—
Government bonds and notes
37
37
—
—
37
—
Corporate bonds
29
29
—
—
29
—
Money market funds
17
17
—
17
—
—
Asset-backed securities
12
12
—
—
12
—
Collateralized mortgage-backed securities
1
1
—
—
1
—
Total
212
212
65
17
130
—
Derivatives:c
Embedded derivatives in provisional sales/purchase contracts
in a gross asset position
76
76
—
—
76
—
Copper futures and swap contracts
4
4
—
3
1
—
Total
80
80
—
3
77
—
Contingent consideration for the sale of the
Deepwater GOM oil and gas propertiesa
50
42
—
—
—
42
Liabilities
Derivatives:c
Embedded derivatives in provisional sales/purchase contracts
in a gross liability position
23
23
—
—
23
—
Copper forward contracts
1
1
—
1
—
—
Total
24
24
—
1
23
—
Long-term debt, including current portiond
9,422
9,364
—
—
9,364
—
a. Current portion included in other current assets and long-term portion included in other assets.
b. Excludes amounts included in restricted cash and cash equivalents and other assets (which approximated fair value), primarily associated with (i) PT-FI’s export proceeds ($0.7 billion at December 31, 2024, and
$1.1 billion at December 31, 2023), (ii) assurance bonds to support PT-FI’s commitment for new downstream processing facilities ($0.1 billion at December 31, 2024 and 2023) and (iii) PT-FI’s mine closure and reclamation
guarantees ($0.1 billion at December 31, 2024 and 2023).
c. Refer to Note 12 for further discussion and balance sheet classifications.
d. Recorded at cost except for debt assumed in acquisitions, which are recorded at fair value at the respective acquisition dates.
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Valuation Techniques. The U.S. core fixed income fund is valued at
NAV. The fund strategy seeks total return consisting of income
and capital appreciation primarily by investing in a broad range of
investment-grade debt securities, including U.S. government
obligations, corporate bonds, mortgage-backed securities, asset-
backed securities and money market instruments. There are no
restrictions on redemptions (which are usually within one business
day of notice).
Equity securities are valued at the closing price reported on
the active market on which the individual securities are traded and,
as such, are classified within Level 1 of the fair value hierarchy.
Fixed income securities (government securities, corporate bonds,
asset-backed securities and collateralized mortgage-backed
securities) are valued using a bid-evaluation price or a mid-evaluation
price. These evaluations are based on quoted prices, if available, or
models that use observable inputs and, as such, are classified within
Level 2 of the fair value hierarchy.
Money market funds are classified within Level 1 of the fair value
hierarchy because they are valued using quoted market prices in
active markets.
FCX’s embedded derivatives on provisional copper concentrate,
copper cathode and gold purchases and sales are valued using quoted
monthly LME or COMEX copper forward prices and the adjusted
London gold prices at each reporting date based on the month of
maturity (refer to Note 12 for further discussion); however, FCX’s
contracts themselves are not traded on an exchange. As a result,
these derivatives are classified within Level 2 of the fair value hierarchy.
FCX’s derivative financial instruments for copper futures and
swap contracts and copper forward contracts that are traded on
the respective exchanges are classified within Level 1 of the fair
value hierarchy because they are valued using quoted monthly
COMEX or LME prices at each reporting date based on the month
of maturity (refer to Note 12 for further discussion). Certain of
these contracts are traded on the over-the-counter market and are
classified within Level 2 of the fair value hierarchy based on
COMEX and LME forward prices.
In December 2016, FCX’s sale of its Deepwater GOM oil and gas
properties included up to $150 million in contingent consideration
(to be received over time) that was recorded at the total amount
under the loss recovery approach. The fair value of this contingent
consideration was calculated based on a discounted cash flow
model using inputs that include third-party estimates for reserves,
production rates and production timing, and discount rates.
Because significant inputs are not observable in the market, the
contingent consideration is classified within Level 3 of the fair
value hierarchy. In third-quarter 2024, FCX determined that only
$4 million of the remaining balance was collectible and recorded
a net impairment of $32 million (consisting of a $42 million
impairment to the contingent consideration receivable and an
offsetting reduction of $10 million to the related overriding royalty
interest payable).
Long-term debt, including current portion, is primarily valued
using available market quotes and, as such, is classified within
Level 2 of the fair value hierarchy.
The techniques described above may produce a fair value
that may not be indicative of NRV or reflective of future fair values.
Furthermore, while FCX believes its valuation techniques are
appropriate and consistent with other market participants, the use
of different techniques or assumptions to determine fair value
of certain financial instruments could result in a different fair value
measurement at the reporting date. There have been no changes
in the techniques used at December 31, 2024, as compared to those
techniques used at December 31, 2023.
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NOTE 14. BUSINESS SEGMENT INFORMATION
Product Revenues. FCX’s revenues attributable to the products it
sold for the years ended December 31 follow:
2024
2023
2022
Copper:
Cathode
$ 8,316
$ 6,629
$ 5,134
Concentrate
6,726
7,127
9,650
Rod and other refined copper products
3,851
3,659
3,699
Purchased coppera
693
416
481
Gold
4,446
3,472
3,397
Molybdenum
1,801
2,006
1,416
Silver and other
631
585
688
Adjustments to revenues:
Royalty expenseb
(442)
(346)
(366)
Treatment charges
(396)
(538)
(503)
PT-FI export dutiesc
(457)
(307)
(325)
Revenues from contracts with customers
25,169
22,703
23,271
Embedded derivativesd
286
152
(491)
Total consolidated revenues
$ 25,455
$22,855
$ 22,780
a. FCX purchases copper cathode primarily for processing by its Rod & Refining operations.
b. Reflects royalties on sales from PT-FI and Cerro Verde that will vary with the volume of metal sold
and prices.
c. Refer to Note 11 for further discussion of PT-FI export duties. Amounts include credits (charges) of
$17 million in 2023 and $(18) million in 2022 associated with adjustments to prior-period export duties.
d. Refer to Note 12 for discussion of embedded derivatives related to FCX’s provisionally priced
concentrate and cathode sales contracts.
Geographic Area. Information concerning financial data by geographic
area follows:
December 31,
2024
2023
Long-lived assets:a
Indonesia
$22,580
$ 20,602
U.S.
10,468
9,386
Peru
6,452
6,563
Chile
1,120
1,105
Other
496
355
Total
$41,116
$ 38,011
a. Excludes deferred tax assets and intangible assets.
Years Ended December 31,
2024
2023
2022
Revenues:a
U.S.
$ 7,806
$ 7,264
$ 7,339
Japan
5,930
3,431
2,462
Switzerland
4,251
3,971
2,740
Singapore
1,116
1,178
1,492
Indonesia
1,108
767
3,026
Spain
1,052
1,251
1,174
China
743
1,081
929
Germany
500
714
632
Chile
451
428
383
France
306
226
177
Philippines
283
396
249
India
273
354
330
Egypt
239
229
149
South Korea
203
267
302
United Kingdom
115
171
355
Other
1,079
1,127
1,041
Total
$ 25,455
$ 22,855
$ 22,780
a. Revenues are attributed to countries based on the location of the customer.
Major Customers and Affiliated Companies. Sales to MMC, PT-FI’s joint
venture partner in PT Smelting, were 17% of FCX’s consolidated
revenues in 2024 and totaled $4.4 billion in 2024, $2.0 billion in
2023 and $0.6 billion in 2022. Sales to PT Smelting were 13% of FCX’s
consolidated revenues in 2022 and totaled $3.0 billion in 2022.
Sales to PT Smelting totaled $27 million in 2023 (reflecting
adjustments to prior period provisionally priced concentrate sales).
MMC and PT Smelting are the only customers that accounted for
10% or more of FCX’s annual consolidated revenues during the three
years ended December 31, 2024.
Consolidated revenues include sales to the noncontrolling interest
owners of FCX’s South America mining operations and Morenci’s
joint venture partners totaling $1.6 billion in 2024, $1.4 billion in 2023
and $1.7 billion in 2022.
Labor Matters. As of December 31, 2024, approximately 28% of
FCX’s global labor force was covered by collective labor agreements
(CLAs), none of which will expire during 2025.
Business Segments. FCX has organized its mining operations
into four primary divisions—North America copper mines, South
America operations, Indonesia operations and Molybdenum
mines, and operating segments that meet certain thresholds are
reportable segments. Separately disclosed in the following tables
are FCX’s reportable segments, which include the Morenci and
Cerro Verde copper mines, the Indonesia operations (including
the Grasberg minerals district and PT-FI’s new downstream
processing facilities), the Rod & Refining operations and Atlantic
Copper Smelting & Refining.
FCX’s Chief Executive Officer is identified as its CODM under
business segment reporting guidance. Operating income (loss) is
the financial measure of profit or loss used by the CODM to review
segment results, and the significant segment expenses reviewed
by the CODM are consistent with the operating expense line items
presented in FCX’s consolidated statements of income. The
CODM uses operating income (loss) to assess segment performance
against forecasted results and to allocate resources, including
capital investment in mining operations and potential expansions.
The 2023 and 2022 tables have been adjusted to conform with
the current year presentation, primarily for the combination of the
Grasberg minerals district and PT-FI’s new downstream processing
facilities. PT-FI’s new downstream processing facilities will
exclusively receive concentrate from the Grasberg minerals district,
which reflects PT-FI’s integrated and dependent operations
within Indonesia (i.e., Indonesia operations). The PMR will receive
anode slimes from the smelter and from PT Smelting. FCX’s
CODM makes executive management decisions, including resource
allocation and mine planning, for the Indonesia operations as a
single business segment.
Intersegment sales between FCX’s business segments are based
on terms similar to arm’s-length transactions with third parties at the
time of the sale. Intersegment sales may not be reflective of the
actual prices ultimately realized because of a variety of factors,
including additional processing, the timing of sales to unaffiliated
customers and transportation premiums.
FCX defers recognizing profits on intercompany sales to Atlantic
Copper until final sales to third parties occur. Until December 31, 2022,
FCX also deferred recognizing 39.5% of PT-FI’s sales to PT Smelting,
until final sales to third parties occurred. Beginning in 2023,
PT-FI’s commercial arrangement with PT Smelting changed to a
tolling arrangement and there were no further sales from PT-FI
to PT Smelting during 2023 and 2024. Quarterly variations in ore
grades, the timing of intercompany shipments and changes in
product prices result in variability in FCX’s net deferred profits and
quarterly earnings.
FCX allocates certain operating costs, expenses and capital
expenditures to its operating divisions and individual segments.
However, not all costs and expenses applicable to an operation are
allocated. U.S. federal and state income taxes are recorded and
managed at the corporate level (included in Corporate, Other &
Eliminations), whereas foreign income taxes are recorded and
managed at the applicable country level. In addition, some selling,
general and administrative costs are not allocated to the operating
divisions or individual reportable segments. Accordingly, the
following segment information reflects management determinations
that may not be indicative of what the actual financial performance
of each operating division or reportable segment would be if it was
an independent entity.
North America Copper Mines. FCX operates seven open-pit copper
mines in North America—Morenci, Safford (including Lone Star),
Bagdad, Sierrita and Miami in Arizona, and Chino and Tyrone in
New Mexico. The North America copper mines include open-pit
mining, sulfide-ore concentrating, leaching and SX/EW operations.
A majority of the copper produced at the North America copper
mines is cast into copper rod by FCX’s Rod & Refining segment. In
addition to copper, certain of FCX’s North America copper mines
also produce molybdenum concentrate, gold and silver.
The Morenci open-pit mine, located in southeastern Arizona,
produces copper cathode and copper concentrate. In addition to
copper, the Morenci mine also produces molybdenum concentrate.
During 2024, the Morenci mine produced 41% of FCX’s North
America copper and 12% of FCX’s consolidated copper production.
South America Operations. South America operations includes
two operating copper mines—Cerro Verde in Peru and El Abra
in Chile. These operations include open-pit mining, sulfide-ore
concentrating, leaching and SX/EW operations.
N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
2024 Annual Report
101
The Cerro Verde open-pit copper mine, located near Arequipa,
Peru, produces copper cathode and copper concentrate. In
addition to copper, the Cerro Verde mine also produces
molybdenum concentrate and silver. During 2024, the Cerro Verde
mine produced 81% of FCX’s South America copper and 23% of
FCX’s consolidated copper production.
Indonesia Operations. Indonesia operations include PT-FI’s
Grasberg minerals district that produces copper concentrate that
contains significant quantities of gold and silver, and PT-FI’s
new downstream processing facilities. During 2024, PT-FI’s Grasberg
minerals district produced 43% of FCX’s consolidated copper
production and 99% of FCX’s consolidated gold production.
Molybdenum Mines. Molybdenum mines include the wholly
owned Henderson underground mine and Climax open-pit mine,
both in Colorado. The Henderson and Climax mines produce
high-purity, chemical-grade molybdenum concentrate, which is
typically further processed into value-added molybdenum
chemical products.
Rod & Refining. The Rod & Refining segment consists of copper
conversion facilities located in North America, and includes a
refinery and two rod mills, which are combined in accordance with
segment reporting aggregation guidance. These operations process
copper produced at FCX’s North America copper mines and
purchased copper into copper cathode and rod. At times these
operations refine copper and produce copper rod for customers
on a toll basis. Toll arrangements require the tolling customer to
deliver appropriate copper-bearing material to FCX’s facilities for
processing into a product that is returned to the customer, who
pays FCX for processing its material into the specified products.
Atlantic Copper Smelting & Refining. Atlantic Copper smelts and
refines copper concentrate and markets refined copper and
precious metals in slimes. During 2024, Atlantic Copper purchased
2% of its concentrate requirements from FCX’s North America
copper mines, 15% from FCX’s South America operations and 13%
from FCX’s Indonesia operations, with the remainder purchased
from unaffiliated third parties.
Corporate, Other & Eliminations. Corporate, Other & Eliminations
consists of FCX’s other mining, oil and gas operations and other
corporate and elimination items, which include the Miami smelter,
molybdenum conversion facilities in the U.S. and Europe, certain
non-operating copper mines in North America (Ajo, Bisbee and
Tohono in Arizona) and other mining support entities.
102
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N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
FINANCIAL INFORMATION BY BUSINESS SEGMENT
North America Copper Mines
South America Operations
Atlantic
Copper
Corporate,
Cerro
Indonesia
Molybdenum
Rod &
Smelting
Other &
FCX
Morenci
Other
Total
Verde
Other
Total
Operations
Mines
Refining
& Refining
Eliminations
Total
Year Ended December 31, 2024
Revenues:
Unaffiliated customers
$ 101
$
79
$ 180
$ 3,618
$ 915
$ 4,533
$ 9,774
$
—
$ 6,196
$ 3,009
$ 1,763a
$ 25,455
Intersegment
2,246
3,814
6,060
638
—
638
544
592
43
8
(7,885)
—
Production and delivery
1,826
3,170
4,996
2,529b
701
3,230
3,368c
530
6,206
2,912
(5,688)d
15,554e
Depreciation, depletion and amortization
187
252
439
380
66
446
1,193
73
4
28
58
2,241
Selling, general and administrative expenses
2
2
4
8
—
8
127
—
—
28
346
513
Exploration and research expenses
17
27
44
12
4
16
8
—
—
—
88
156
Environmental obligations and shutdown costs
—
—
—
—
—
—
—
—
—
—
127
127
Operating income (loss)
315
442
757
1,327
144
1,471
5,622
(11)
29
49
(1,053)
6,864
Interest expense, net
—
1
1
21
—
21
28
—
—
36
233
319
Other (expense) income, net
(1)
2
1
42
24
66
136
—
(1)
13
147
362
Provision for (benefit from) income taxes
—
—
—
542
62
604
1,907f
—
—
(11)
23
2,523
Equity in affiliated companies’ net earnings
—
—
—
—
—
—
7
—
—
—
8
15
Net income attributable to noncontrolling interests
—
—
—
412g
67
479
2,022h
—
—
—
9
2,510
Net income attributable to common stockholders
1,889
Total assets at December 31, 2024
3,228
6,766
9,994
8,096
2,060
10,156
27,309
2,018
202
1,705
3,464
54,848
Capital expenditures
184
849
1,033
293
82
375
2,908
117
35
142
198
4,808
N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
2024 Annual Report
103
FINANCIAL INFORMATION BY BUSINESS SEGMENT (continued)
North America Copper Mines
South America Operations
Atlantic
Copper
Corporate,
Cerro
Indonesia
Molybdenum
Rod &
Smelting
Other &
FCX
Morenci
Other
Total
Verde
Other
Total
Operations
Mines
Refining
& Refining
Eliminations
Total
Year Ended December 31, 2023
Revenues:
Unaffiliated customers
$
91
$ 152
$ 243
$ 3,330
$ 824
$ 4,154
$ 7,816i
$
—
$ 5,886
$ 2,791
$ 1,965a
$ 22,855
Intersegment
2,328
3,745
6,073
787
—
787
621
677
40
19
(8,217)
—
Production and delivery
1,730
3,048
4,778
2,529
710
3,239
2,570c
439
5,901
2,718
(6,018)d
13,627e
Depreciation, depletion and amortization
175
243
418
395
64
459
1,028
66
5
28
64
2,068
Selling, general and administrative expenses
2
2
4
9
—
9
129
—
—
28
309
479
Exploration and research expenses
11
39
50
10
4
14
2
—
—
—
71
137
Environmental obligations and shutdown costs
(1)
28
27
—
—
—
—
—
—
—
292j
319
Operating income (loss)
502
537
1,039
1,174
46
1,220
4,708
172
20
36
(970)
6,225
Interest expense, net
—
1
1
77k
—
77
35
—
—
31
371
515
Net gain on early extinguishment of debt
—
—
—
—
—
—
—
—
—
—
10
10
Other (expense) income, net
(5)
3
(2)
(13)k
11
(2)
122
(1)
(2)
(8)
179
286
Provision for (benefit from) income taxes
—
—
—
495
17
512
1,774
—
—
—
(16)
2,270
Equity in affiliated companies’ net earnings
—
—
—
—
—
—
10
—
—
—
5
15
Net income (loss) attributable to noncontrolling interests
—
—
—
300g
36
336
1,614h
—
—
—
(47)
1,903
Net income attributable to common stockholders
1,848
Total assets at December 31, 2023
3,195
5,996
9,191
8,120
1,930
10,050
25,548
1,782
172
1,326
4,437
52,506
Capital expenditures
232
529
761
271
97
368
3,324
84
13
64
210
4,824
North America Copper Mines
South America Operations
Atlantic
Copper
Corporate,
Cerro
Indonesia
Molybdenum
Rod &
Smelting
Other &
FCX
Morenci
Other
Total
Verde
Other
Total
Operations
Mines
Refining
& Refining
Eliminations
Total
Year Ended December 31, 2022
Revenues:
Unaffiliated customers
$ 175
$ 253
$ 428
$ 3,444
$ 768
$ 4,212
$ 8,028i
$
—
$ 6,281
$ 2,439
$ 1,392a
$ 22,780
Intersegment
2,514
3,768
6,282
506
—
506
398
565
31
4
(7,786)
—
Production and delivery
1,550
2,827
4,377
2,369
705
3,074
2,686c
359
6,330
2,452l
(6,208)d
13,070e
Depreciation, depletion and amortization
177
233
410
357
51
408
1,025
74
5
27
70
2,019
Selling, general and administrative expenses
2
3
5
8
—
8
117
—
—
25
265
420
Exploration and research expenses
2
45
47
5
4
9
—
3
—
—
56
115
Environmental obligations and shutdown costs
(5)
1
(4)
—
—
—
—
—
—
—
125
121
Net gain on sales of assets
—
—
—
—
—
—
—
—
—
—
(2)
(2)
Operating income (loss)
963
912
1,875
1,211
8
1,219
4,598
129
(23)
(61)
(700)
7,037
Interest expense, net
1
1
2
15
—
15
38
—
—
15
490
560
Net (loss) gain on early extinguishment of debt
—
—
—
—
—
—
(11)
—
—
—
42
31
Other (expense) income, net
(2)
(30)
(32)
13
4
17
120
—
(1)
13
90
207
Provision for (benefit from) income taxes
—
—
—
461
(8)
453
1,820
—
—
(1)
(5)
2,267
Equity in affiliated companies’ net earnings
—
—
—
—
—
—
24
—
—
—
7
31
Net income attributable to noncontrolling interests
—
—
—
372g
35
407
592h
—
—
—
12
1,011
Net income attributable to common stockholders
3,468
Total assets at December 31, 2022
3,052
5,552
8,604
8,398
1,873
10,271
22,727
1,697
183
1,262
6,349
51,093
Capital expenditures
263
334
597
164
140
304
2,382
33
9
76
68
3,469
a. Includes revenues from FCX’s molybdenum sales company, which includes sales of molybdenum produced by the Molybdenum mines and by certain of the North America and South America copper mines.
b. Includes nonrecurring labor-related charges totaling $97 million associated with Cerro Verde’s new CLAs with its two unions.
c. Includes charges for administrative fines of $4 million in 2024, $55 million in 2023 and $41 million in 2022. Also includes charges (credits) totaling $144 million in 2024, $(112) million in 2023 and $116 million in 2022
associated with ARO adjustments. Refer to Note 10 for further discussion.
d. Includes oil and gas charges totaling $217 million in 2024, $70 million in 2023 and $6 million in 2022 related to asset impairments and adjustments to AROs, including assumed abandonment obligations resulting
from bankruptcies of other companies.
e. Includes metals inventory adjustments of $91 million in 2024, $14 million in 2023 and $29 million in 2022.
f. Includes a net benefit to income taxes totaling $182 million associated with the closure of PT-FI’s 2021 corporate income tax audit and resolution of the framework for Indonesia disputed tax matters. Refer to Note 9
for further discussion.
g. Beginning in September 2024, FCX’s interest in Cerro Verde is 55.08%, and prior to September 2024 was 53.56%.
h. Beginning January 1, 2023, FCX’s economic and ownership interest in PT-FI is 48.76% except for net income associated with the settlement of historical tax matters in 2024 and approximately 190 thousand ounces of
gold sales in 2023, which were attributed based on the economic interests prior to January 1, 2023 (i.e., approximate 81% to FCX and 19% to MIND ID). Refer to Note 2 for further discussion.
i. Includes sales to PT Smelting totaling $27 million in 2023 (reflecting adjustments to prior period provisionally priced concentrate sales), and $3.0 billion in 2022.
j. Includes a charge of $65 million associated with an adjustment to the proposed settlement of talc-related litigation.
k. Interest expense, net includes $74 million of charges associated with contested tax rulings issued by the Peru Supreme Court, partly offset by a $13 million credit for the settlement of interest on Cerro Verde’s historical
profit sharing liability. Other (expense) income, net includes a charge of $69 million associated with contested tax rulings issued by the Peru Supreme Court.
l. Includes maintenance charges and idle facility costs associated with a major maintenance turnaround at Atlantic Copper totaling $41 million.
NOTE 15. SUPPLEMENTARY MINERAL RESERVE
INFORMATION (UNAUDITED)
Recoverable proven and probable mineral reserves as of
December 31, 2024, have been prepared using industry accepted
practice and conform to the disclosure requirements under
Subpart 1300 of SEC Regulation S-K. FCX’s proven and probable
mineral reserves may not be comparable to similar information
regarding mineral reserves disclosed in accordance with the
guidance in other countries. Proven and probable mineral reserves
were determined by the use of mapping, drilling, sampling,
assaying and evaluation methods generally applied in the mining
industry. Mineral reserves, as used in the reserve data presented
here, mean an estimate of tonnage and grade of measured and
indicated mineral resources that, in the opinion of the qualified
person, can be the basis of an economically viable project. Proven
mineral reserves are the economically mineable part of a
measured mineral resource. To classify an estimate as a proven
mineral reserve, the qualified person must possess a high degree
of confidence of tonnage, grade and quality. Probable mineral
reserves are the economically mineable part of an indicated or, in
some cases, a measured mineral resource. The qualified person’s
level of confidence will be lower in determining a probable mineral
reserve than it would be in determining a proven mineral reserve.
To classify an estimate as a probable mineral reserve, the qualified
person’s confidence must still be sufficient to demonstrate that
extraction is economically viable considering reasonable investment
and market assumptions.
FCX’s mineral reserve estimates are based on the latest available
geological and geotechnical studies. FCX conducts ongoing
studies of its ore bodies to evaluate economic values and to manage
risk. FCX revises its mine plans and estimates of proven and
probable mineral reserves as required in accordance with the
latest available studies.
Estimated recoverable proven and probable mineral reserves at
December 31, 2024, were determined using metals price assumptions
of $3.25 per pound for copper, $1,600 per ounce for gold and
$12.00 per pound for molybdenum. For the three-year period ended
December 31, 2024, LME copper settlement prices averaged
$4.00 per pound, London PM gold prices averaged $2,044 per ounce
and the weekly average price for molybdenum quoted by Platts
Metals Daily averaged $21.41 per pound.
The recoverable proven and probable mineral reserves presented
in the table below represent the estimated metal quantities from
which FCX expects to be paid after application of estimated
metallurgical recoveries and smelter recoveries, where applicable.
Estimated Recoverable Proven and Probable
Mineral Reserves at December 31, 2024
Coppera
Gold
Molybdenum
(billion pounds)
(million ounces)
(billion pounds)
North America
41.6
0.6
2.51
South America
28.4
—
0.66
Indonesiab
27.0
22.4
—
Consolidated basisc
97.0
23.0
3.16
Net equity interestb,d
70.2
11.5
2.87
Note: Totals may not foot because of rounding.
a. Estimated consolidated recoverable copper reserves included 1.4 billion pounds in leach stockpiles
and 0.3 billion pounds in mill stockpiles.
b. Estimated recoverable proven and probable mineral reserves from Indonesia reflect estimates
of minerals that can be recovered through 2041. As a result, PT-FI’s current long-term mine
plan and planned operations are based on the assumption that PT-FI will abide by the terms and
conditions of the IUPK and will be granted the 10-year extension from 2031 through 2041 (refer to
Note 11 for discussion of PT-FI’s IUPK). As a result, PT-FI will not mine all of these mineral reserves
during the initial term of the IUPK. Prior to the end of 2031, PT-FI expects to mine 40% of its
recoverable proven and probable mineral reserves at December 31, 2024, representing 45% of FCX’s
net equity share of recoverable copper reserves and 44% of FCX’s net equity share of recoverable
gold reserves in Indonesia.
c. Consolidated mineral reserves represent estimated metal quantities after reduction for joint venture
partner interests at the Morenci mine in North America (refer to Note 2 for further discussion).
Excluded from the table above were FCX’s estimated recoverable proven and probable mineral
reserves of 318 million ounces of silver, which were determined using $20 per ounce.
d. Net equity interest mineral reserves represent estimated consolidated metal quantities further
reduced for noncontrolling interest ownership (refer to Note 2 for further discussion of FCX’s
ownership in subsidiaries). Excluded from the table above were FCX’s estimated recoverable proven
and probable mineral reserves of 213 million ounces of silver.
104
Freeport | Powering Progress
N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
Estimated Recoverable Proven and Probable Mineral Reserves
at December 31, 2024
Orea
Average Ore Grade
Recoverable Proven and
(million metric tons)
Per Metric Tona
Probable Mineral Reservesb
Copper
Gold
Molybdenum
FCX’s
FCX’s
100%
Copper
Gold
Molybdenum
(billion
(million
(billion
Interest
Interest
Basis
(%)
(grams)
(%)
pounds)
ounces)
pounds)
North America
Production stage:
Morenci
72%
2,739
3,804
0.21
—
—c
11.1
—
0.17
Sierrita
100%
2,206
2,206
0.23
—c
0.03
9.4
0.1
0.96
Bagdad
100%
2,430
2,430
0.35
—c
0.02
15.8
0.2
0.86
Safford, including Lone Star
100%
746
746
0.43
—
—
5.1
—
—
Chino, including Cobre
100%
370
370
0.45
0.04
—
3.0
0.4
—
Climax
100%
141
141
—
—
0.15
—
—
0.42
Henderson
100%
44
44
—
—
0.16
—
—
0.14
Tyrone
100%
69
69
0.19
—
—
0.3
—
—
Miami
100%
—
—
—
—
—
0.1
—
—
South America
Production stage:
Cerro Verde
55.08%
2,145
3,894
0.34
—
0.01
25.2
—
0.66
El Abra
51%
312
611
0.43
—
—
3.1
—
—
Indonesiad
Production stage:
Grasberg Block Cave
48.76%
351
719
0.99
0.66
—
13.4
10.3
—
Deep Mill Level Zone
48.76%
159
326
0.74
0.60
—
4.4
4.9
—
Big Gossan
48.76%
23
48
2.23
0.95
—
2.2
1.0
—
Development stage:
Kucing Liar
48.76%
180
369
1.10
0.94
—
7.1
6.2
—
Total 100% basis
15,779
100.1
23.0
3.21
Consolidated basise
14,714
97.0
23.0
3.16
FCX’s net equity interestf
11,916
70.2
11.5
2.87
Note: Totals may not foot because of rounding.
a. Excludes material contained in stockpiles.
b. Includes estimated recoverable metals contained in stockpiles.
c. Amounts not shown because of rounding.
d. Estimated recoverable proven and probable mineral reserves from Indonesia reflect estimates of minerals that can be recovered through 2041. Refer to Note 11 for discussion of PT-FI’s IUPK.
e. Consolidated mineral reserves represent estimated metal quantities after reduction for Morenci’s joint venture partner interests (refer to Note 2 for further discussion).
f. Net equity interest mineral reserves represent estimated consolidated metal quantities further reduced for noncontrolling interest ownership (refer to Note 2 for further discussion of FCX’s ownership in subsidiaries).
N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
2024 Annual Report
105
Comparison of 5 Year Cumulative Total Return
Among Freeport-McMoRan Inc., the S&P 500 Stock Index and the S&P Metals and Mining Select Industry Index
Freeport-McMoRan Inc.
$ 100.00
$ 199.07
$ 321.27
$ 297.71
$ 338.39
$ 306.60
S&P 500 Stock Index
100.00
118.40
152.39
124.79
157.59
197.02
S&P Metals and Mining Select Industry Index
100.00
116.44
157.75
178.99
218.23
208.99
2019
2020
2021
2022
2023
2024
December 31,
S&P Total Market Index that are classified in the metals and
mining sub-industry. This comparison assumes $100 invested on
December 31, 2019, in (i) Freeport-McMoRan Inc. common stock,
(ii) the S&P 500 Stock Index and (iii) the S&P Metals and Mining
Select Industry Index (with the reinvestment of all dividends).
The following graph compares the change in the cumulative total
stockholder return on our common stock with the cumulative
total return of the S&P 500 Stock Index and the S&P Metals and
Mining Select Industry Index from 2020 through 2024. The S&P
Metals and Mining Select Industry Index comprises stocks in the
12/31/24
12/31/23
12/31/22
12/31/21
12/31/20
12/31/19
106
Freeport | Powering Progress
P E R F O R M A N C E G R A P H
$400
$350
$300
$250
$200
$150
$100
$50
$0
INVESTOR INQUIRIES
The Investor Relations Department is pleased to receive any
inquiries about the company. Our Annual Report on Form
10-K filed with the U.S. Securities and Exchange Commission
(SEC), which includes certifications of our Chief Executive
Officer and Chief Financial Officer, is available on our website.
Additionally, copies will be furnished, without charge, to any
stockholder of the company entitled to vote at the annual
meeting, upon written request. The Investor Relations
Department can be contacted as follows:
Freeport-McMoRan Inc.
Investor Relations Department
333 North Central Avenue
Phoenix, AZ 85004
Telephone 602.366.8400
fcx.com
TRANSFER AGENT
Questions about lost certificates, lost or missing dividend
checks, or notifications of change of address should be
directed to our transfer agent, registrar and dividend
disbursement agent:
Computershare
150 Royall Street, Suite 101
Canton, MA 02021
Telephone 800.953.2493
https://www-us.computershare.com/investor/contact
NOTICE OF ANNUAL MEETING
The annual meeting of stockholders will be held June 11, 2025.
Notice of the annual meeting will be sent to stockholders
of record as of the close of business on April 14, 2025. In
accordance with SEC rules, we will report the voting results of
our annual meeting on a Form 8-K, which will be available on
our website (fcx.com).
FCX COMMON STOCK
FCX’s common stock trades on the New York Stock Exchange
(NYSE) under the symbol “FCX.” As of March 15, 2025, the
number of holders of record of FCX’s common stock was 9,053.
NYSE composite tape common share price ranges during
2024 and 2023 were:
COMMON STOCK DIVIDENDS
FCX currently pays a cash dividend on its common stock at
an annual rate of $0.30 per share. Under FCX’s performance-
based payout framework, the Board approved a variable
cash dividend on common stock for 2024 and 2023 totaling
$0.30 per share per annum. The combined annual rate of
the base dividend and the variable dividend totaled
$0.60 per share in 2024 and 2023.
Based on current market conditions, the base and variable
dividends on FCX’s common stock are anticipated to total
$0.60 per share for 2025 (including the dividends paid on
February 3, 2025), comprised of a $0.30 per share base
dividend and $0.30 per share variable dividend.
FCX BENEFICIAL OWNERS
The beneficial owners of more than five percent of our
outstanding common stock as of December 31, 2024, included
The Vanguard Group (8.3%), BlackRock, Inc. (7.7%) and
Capital Research Global Investors (5.8%).
2024
Amount per Share
Record Date
Payment Date
Base
Variable
First Quarter
$0.075
$0.075
Jan. 12, 2024
Feb. 1, 2024
Second Quarter
$0.075
$0.075
April 15, 2024
May 1, 2024
Third Quarter
$0.075
$0.075
July 15, 2024
Aug. 1, 2024
Fourth Quarter
$0.075
$0.075
Oct. 15, 2024
Nov. 1, 2024
2023
Amount per Share
Record Date
Payment Date
Base
Variable
First Quarter
$0.075
$0.075
Jan. 13, 2023
Feb. 1, 2023
Second Quarter
$0.075
$0.075
April 14, 2023
May 1, 2023
Third Quarter
$0.075
$0.075
July 14, 2023
Aug. 1, 2023
Fourth Quarter
$0.075
$0.075
Oct. 13, 2023
Nov. 1, 2023
2024
2023
High
Low
High
Low
First Quarter
$47.19
$36.26
$46.73
$34.88
Second Quarter
$55.24
$46.57
$43.46
$33.05
Third Quarter
$52.61
$39.08
$44.70
$36.04
Fourth Quarter
$51.45
$37.67
$43.42
$32.83
S T O C K H O L D E R I N F O R M A T I O N
2024 Annual Report 107
FCX.COM
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