Freeport-McMoRan Inc. (NYSE: FCX) is a leading international mining company with headquarters in Phoenix, Arizona, which operates large, long-lived, geographically diverse assets with significant proven and probable reserves of copper, gold and molybdenum. Freeport-McMoRan is one of the world’s largest publicly traded copper producers.
Formerly known as Freeport-McMoRan Copper & Gold Inc., the company was established in 1988 following the discovery of the Grasberg copper and gold deposit in Papua, Indonesia, when Freeport-McMoRan’s former parent company sold 20 percent of the company in an initial public offering. Following the acquisition of Phelps Dodge in 2007, Freeport-McMoRan transformed into a dynamic industry leader, combining the assets and technical teams of the two firms.
The company’s unique portfolio of mining assets was developed and acquired by several predecessor companies, including Freeport Minerals, Phelps Dodge, Cyprus Minerals, American Metal Company and Climax Molybdenum, among others. These many important milestones make Freeport-McMoRan’s portfolio of assets difficult to replicate today.
Operations and Assets
The company’s near-term focus prioritizes liquidity and balance sheet strength, while preserving long-lived mineral resources, driving organic growth and delivering value to shareholders. In addition, Freeport-McMoRan is currently deploying data analytics initiatives to accentuate operations by adding volume, improving efficiencies and growing margins.
Freeport-McMoRan’s portfolio of assets includes the Grasberg minerals district in Indonesia, one of the world’s largest copper and gold deposits, and significant mining operations in the Americas, including the large-scale Morenci minerals district in North America and the Cerro Verde operation in South America.
During 2019, Freeport-McMoRan advanced three key operating initiatives to build a strong foundation for long-term profitable growth. As the leading responsible copper producer, the company’s core values – safety, respect, integrity, excellence and commitment – underpin the success of these initiatives, which build on the strength of the company’s high-quality portfolio of copper reserves.
Despite current global economic uncertainties, copper remains an essential metal for global growth and for a future with a lower carbon footprint. The company has a proven track record for navigating volatile market conditions that demonstrates its ability to maintain strength during uncertain economic times.
Freeport-McMoRan has significant reserves, resources and future development opportunities within its portfolio of mining assets. As of December 31, 2019, estimated consolidated recoverable proven and probable mineral reserves included 116 billion pounds of copper, 29.6 million ounces of gold, 3.58 billion pounds of molybdenum and 375.4 million ounces of silver.
The Value of Copper
Copper is an extremely versatile metal and a major component in electric vehicles (EVs), being used in electric motors, batteries, inverters, wiring and charging stations. EVs, which consume up to four times the amount of copper in terms of weight compared to vehicles of similar size with internal combustion engines, are expected to be a long-term global demand driver for copper.
Copper’s physical attributes include superior electrical conductivity, corrosion resistance, structural capability and efficient heat transfer. Substitution of competing materials has been modest, because it is difficult to duplicate copper’s unique characteristics.
Copper has been at the center of communications breakthroughs, including high-speed computer applications, satellite technology and even wireless communications. Copper has the best electrical and thermal heat conductivity of any industrial metal and is vital to energy efficiency.
Copper is positioned to be critical for emerging technology for the foreseeable future. Renewable and alternative energy applications, medical science research, and hybrid and electric automobile development are dependent on the metal and often use more copper than do traditional applications.
The current public health crisis is spotlighting the substantial antimicrobial properties of copper, which can reduce and sometimes significantly diminish the transmission of bacteria, viruses and other pathogens. Going forward, copper is expected to be increasingly used for personal health protection in medical facilities and other public spaces.
Freeport-McMoRan plays a critical role in providing the metals necessary for global economic growth, a successful transition to a low-carbon economy and the development of the technologies necessary to improve quality of life for people around the world. Increased demand for responsibly and ethically produced copper drives the company’s ambition to be the leading responsible copper producer.
Freeport-McMoRan has been using the strength of its global supply chain to acquire, purchase, donate and deliver much-needed medical supplies and more to COVID-19 relief efforts as part of its commitment to its local communities. Ventilators and a fully equipped ambulance were donated in Calama, Chile, and a portable oxygen plant and cylinders were provided to the community of Arequipa, Peru. In Indonesia, the company is enabling regional testing and has made several food donations to remote Papuan communities.
In March 2020, Freeport-McMoRan announced suspension of its common stock dividend in response to the global pandemic and an uncertain business environment. The company’s successful execution of revised operating plans is expected to provide increased cash flows and enhanced financial flexibility in 2021 and beyond. The Freeport-McMoRan board of directors plans to review future dividends on an ongoing basis.
Richard C. Adkerson is Vice Chairman, President and Chief Executive Officer of Freeport-McMoRan Inc. Adkerson has served on the Freeport-McMoRan board since 2006. He has been named the ‘Best CEO in Metals and Mining’ by Institutional Investor magazine numerous times. Adkerson is a current member and past Chairman of the International Council on Mining and Metals. Prior to joining Freeport-McMoRan in 1989, he was Partner and Managing Director at Arthur Andersen & Co., where he headed the firm’s worldwide oil and gas industry practice.
Kathleen L. Quirk is the Executive Vice President and Chief Financial Officer of Freeport-McMoRan Inc. Quirk has over 30 years of experience in the Freeport-McMoRan organization and is a senior member of the company’s executive team. She has been instrumental in Freeport-McMoRan’s strategic planning and has responsibility for a broad range of financial and administrative functions. She has been named ‘Best CFO in Metals and Mining’ by Institutional Investor magazine on numerous occasions.
Harry M. “Red” Conger is Freeport-McMoRan’s President and Chief Operating Officer – Americas. He has served as Chief Operating Officer – Americas since July 2015, and as President – Americas since 2007. He was the recipient of the Charles F. Rand Memorial Gold Medal in 2017, recognizing his leadership in safety, change management and production efficiency. In December 2018, he was inducted into the American Mining Hall of Fame.
- Freeport-McMoRan Inc., one of the world’s largest publicly traded copper producers, operates geographically diverse assets with significant proven and probable reserves of copper, gold and molybdenum.
- The company has a unique portfolio of mining assets, which was developed and acquired by several predecessor companies and includes the Grasberg minerals district in Indonesia, one of the world’s largest copper and gold deposits, along with significant mining operations in the Americas, including the large-scale Morenci minerals district in North America and the Cerro Verde operation in South America.
- Freeport-McMoRan has promising opportunities for future development due to significant reserves and resources within its portfolio of mining assets. As of December 31, 2019, estimated consolidated recoverable, proven and probable mineral reserves included 116 billion pounds of copper, 29.6 million ounces of gold, 3.58 billion pounds of molybdenum and 375.4 million ounces of silver.
- The company has been using the strength of its global supply chain to acquire, purchase, donate and deliver much-needed medical supplies and more to COVID-19 relief efforts as part of its commitment to its local communities.